Opinion
20-P-676
08-24-2021
William W. THOMAS v. Eric S. MEDEIROS & others.
MEMORANDUM AND ORDER PURSUANT TO RULE 23.0
The plaintiff, William Thomas, appeals from a judgment in favor of the defendants entered by a Land Court judge following a bench trial. That judgment turned on the judge's determination that the seemingly expansive nature of a 1955 deed was based on a mutual mistake, and the parties to that deed never intended it to transfer ownership of the parcels in question. The defendants, Eric Medeiros, Jeffrey Medeiros, and the estate of Ernest A. Medeiros, cross-appeal from an order of the trial judge denying in part their motion to alter and amend the judgment. Discerning no error in the judge's finding that there was a mutual mistake between the parties to the 1955 deed, but concluding that the judge should have declared that the defendants hold good record title to lot 14, we modify the judgment.
1. Mistake. a. Standard of review. "It is well established that on appeal, we are bound by the trial judge's findings of fact, including all reasonable inferences, that are supported by the evidence." Goddard v. Goucher, 89 Mass. App. Ct. 41, 44 (2016). "These findings may not be set aside unless clearly erroneous." I&R Mechanical, Inc. v. Hazelton Mfg. Co., 62 Mass. App. Ct. 452, 456 (2004). "The judge's legal conclusions are reviewed de novo." Youghal, LLC v. Entwistle, 484 Mass. 1019, 1019-1020 (2020), quoting Anastos v. Sable, 443 Mass. 146, 149 (2004).
b. Extrinsic evidence. "If the language of a written instrument does not reflect the true intent of both parties, the mutual mistake is reformable." Caron v. Horace Mann Ins. Co., 466 Mass. 218, 222 (2013), quoting Polaroid Corp. v. Travelers Indem. Co., 414 Mass. 747, 756 (1993). "The mistake must either be mutual ... or be made by one party and known to the other party." Caron, supra, quoting Polaroid Corp., supra. Additionally, the mistake "must relate to an essential element of the agreement." Caron, supra, quoting LaFleur v. C.C. Pierce Co., 398 Mass. 254, 257-258 (1986).
In proving mistake, "[t]he parol evidence rule does not bar extrinsic proof of intent." Polaroid Corp., 414 Mass. at 756. See Mickelson v. Barnet, 390 Mass. 786, 792 (1984) ("The parol evidence rule is no bar to the consideration of extrinsic evidence of intent when mistake is alleged"); McGovern v. McGovern, 77 Mass. App. Ct. 688, 700 (2010) (considering extrinsic evidence in holding there was mutual mistake). Thus, here, the trial judge properly considered extrinsic evidence in determining whether there was a mutual mistake between the parties to the 1955 deed.
c. Waiver. Under Mass. R. Civ. P. 9 (b), 365 Mass. 751 (1974), "[i]n all averments of fraud, mistake, duress or undue influence, the circumstances constituting fraud, mistake, duress or undue influence shall be stated with particularity." See Equipment & Sys. for Indus. v. Northmeadows Constr. Co., 59 Mass. App. Ct. 931, 932 (2003) (" rule 9 [b] heightens the pleading requirements placed on plaintiffs who allege fraud and deceit"). Nonetheless, "[w]hen issues not raised by the pleadings are tried by express or implied consent of the parties, they shall be treated in all respects as if they had been raised in the pleadings." Mass. R. Civ. P. 15 (b), 365 Mass. 761 (1974). We look to whether the adverse party is "warned adequately by the complaint [or counterclaim] of the acts which the plaintiff [or defendant] claims were fraudulent [or the particular circumstances comprising the mistake] so that [the adverse party can] prepare [his or her] defense." Lazzaro v. Holladay, 15 Mass. App. Ct. 108, 110 (1983). See Go-Best Assets Ltd. v. Citizens Bank of Mass., 79 Mass. App. Ct. 473, 489 (2011), rev'd on other grounds, 463 Mass. 50 (2012) ("The primary purpose of rule 9 [b] is to place the defendant in a fraud case on notice of the specific acts that are alleged to have been fraudulent"); Bly-Magee v. California, 236 F.3d 1014, 1019 (9th Cir. 2001), quoting Neubronner v. Milken, 6 F.3d 666, 672 (9th Cir. 1993) ("To comply with Rule 9 [b], allegations of fraud must be ‘specific enough to give defendants notice of the particular misconduct which is alleged to constitute the fraud charged so that they can defend against the charge and not just deny that they have done anything wrong’ ").
Furthermore, even where evidence is objected to on this ground, a judge shall allow the issue to be introduced into the case "when the presentation of the merits of the action will be subserved thereby and the objecting party fails to satisfy the court that the admission of such evidence would prejudice him in maintaining his action or defense upon the merits." Mass. R. Civ. P. 15 (b). See Shafir v. Steele, 431 Mass. 365, 368 n.7 (2000) (where defendant did not object to claim not explicitly mentioned in complaint, but where "the nature of the plaintiff's complaint was evident in her counsel's opening argument," nor did he "argue[ ] prejudice," claim properly considered).
Although the defendants’ primary position was that the deeds were ambiguous, the plaintiff was on notice that the defendants took the alternative position that there was a mutual mistake between Carrie Luce and William and Meredyth Thomas (the plaintiff's parents), the parties to the 1955 deed, because there was a significant amount of evidence bearing on that mistake presented by the defendants at trial. The case was tried on the theory of mutual mistake, as pointed out by the judge at the end of the trial when discussing posttrial memoranda with counsel. The judge stated, "certainly there's been discussion about mistake, but I don't know that anyone has ... provided me with a law of mistake. I'm pretty familiar with it, but that, based on this record, may be an issue. So I suggest that on top of the ... issues with ambiguity of language and adverse possession and that stuff that's already been discussed, so I just wanted to flag that for you." Indeed, the plaintiff's posttrial memorandum fully addressed mistake, albeit including the argument that he makes on appeal that it was not pleaded with particularity. Because the issue of mutual mistake was "tried by ... implied consent of the parties, [it] shall be treated in all respects as if [it] had been raised in the pleadings." Mass. R. Civ. P. 15 (b). See Trapp v. Roden, 473 Mass. 210, 220 (2015).
The plaintiff's trial counsel had an opportunity to cross-examine the defendants’ mother about Carrie Luce's "mistake," of which he took full advantage.
This argument was purely procedural; the plaintiff raised no claim of prejudice or suggestion that he would have proceeded differently if the claim had been made with particularity in the pleadings.
d. Merits. "The mutual mistake doctrine exists to effectuate the agreement intended by the parties to a contract where the contract language fails to capture that agreement." Caron, 466 Mass. at 223. "Central to this doctrine is the fundamental underpinning that the parties had reached an agreement on a point which they intended to enshrine in the written contract but which, for some reason, was mistakenly omitted from that written contract."Id. "Clear and convincing proof of the mistake is required to reform a deed due to mutual mistake." McGovern, 77 Mass. App. Ct. at 700.
Although the plaintiff argues that the judge lacked the authority to reform the deed on a finding of mistake, the judge did not reform the deed, but instead ruled that the property is "held in a constructive trust for the benefit of Carrie [Luce]’s heirs." Nonetheless, the judge had the authority to either reform the deed or hold the land in a constructive trust once she found that there was a mutual mistake, considering that the plaintiff's parents were parties to the 1955 deed and there is no indication in the record that the plaintiff was a bona fide purchaser. See Cavadi v. DeYeso, 458 Mass. 615, 627 (2011) (constructive trust may be "implied by law as a result of mistake, violation of a fiduciary duty, or unjust enrichment"); Buk Lhu v. Dignoti, 431 Mass. 292, 294 (2000) ("It is well established that legal instruments, including deeds, may be reformed on the ground of mutual mistake," but may not be reformed against bona fide purchaser on ground of mutual mistake).
Here, the evidence supported the judge's finding that the parties to the 1955 deed, Carrie Luce and the plaintiff's parents, did not intend to include lots 30 and 45 (collectively, the subject property) in the land covered by the deed, despite language in the deed that, read literally, would include them. The 1955 deed stated that Carrie Luce was "conveying to these grantees all of my right, title and interest in and to any and all land situated in said Town of West Tisbury which I own or have any interest in." The mother of Eric and Jeffrey Medeiros testified that when she went to Carrie Luce's apartment with her husband in 1964 after being notified by the bank that there was a problem with their deed, Carrie Luce said there was "a mistake." According to the mother, Carrie Luce told them "that she never owned the woodlands. She said that the property in Lamberts Cove was totally separate from the woodlands." Subsequently, that same year, Carrie Luce signed a quitclaim deed conveying her interest in the subject property to Ernest A. and Margaret Medeiros (Eric and Jeffrey Medeiros's parents). Similarly, in his deposition testimony, Ernest A. Medeiros stated that Carrie Luce told him, "I don't have any interest in the land, Mr. Medeiros. If you'd like I'll make things easier for you, I'll sign a release."
The parties stipulated that the Medeiros family adversely possessed lot 14.
Further, the plaintiff's parents never objected to the Medeiros family's use of the land until the late 1970s, despite Ernest S. Medeiros's being deeded the land by Mary F. Luce in 1944 and the Medeiros family's active use of the land. It was not until the 1970s that the plaintiff allegedly attempted to pay taxes on the subject property. Even so, the judge did not credit the plaintiff's assertions that he paid taxes on some of the subject property for a period of time, and credited Eric Medeiros's testimony that he had been paying taxes on lots 30 and 45 since 1992. These circumstances support the conclusion that neither the plaintiff's parents nor Carrie Luce believed that she had deeded them the subject property. See Buk Lhu v. Dignoti, 431 Mass. 292, 298 (2000), quoting Burke v. McLaughlin, 246 Mass. 533, 540-541 (1923) (reforming deeds proper remedy where "all parties believed [defendant] owned [disputed area] ... and [giving area to plaintiff based on incorrect metes and bounds description in deeds] would allow [plaintiff] ‘to reap the harvest of a bargain [it] never intended to make’ "); Green v. Cappy Homes Co., 354 Mass. 35, 37-38 (1968) ("The mutual mistake can be seen in the subsequent conduct of the corporation in seeding the plaintiffs’ land thirty-five feet out from the house and in the Iollis’ failure over two years to object to the plaintiffs’ activity on that strip.... The corporation and the Iollis understood the language of the deed but both misapprehended the actual boundaries").
The Medeiros family built their home on lot 14 in 1964, used lots 30 and 45 to collect firewood, and occasionally allowed others to camp, hunt, park their cars, and pick berries on the land.
It bears notice that the plaintiff lived on Martha's Vineyard at least part of the year from 1956.
It is of no matter that the tax valuation for the land in 1955 was $2,665, and that the plaintiff's parents paid $4,000 to $4,500 for it, as the tax valuation does not necessarily reflect the actual value of the property. See General Elec. Co. v. Assessors of Lynn, 393 Mass. 591, 599 (1984) ("By holding that the assessment is entitled to a presumption of validity, we are only restating that the taxpayer bears the burden of persuasion of every material fact necessary to prove that its property has been overvalued" [emphasis added]). "[F]air cash value cannot be proven with mathematical certainty." Id. at 607. "The market value of real estate generally ‘[can]not be proved with mathematical certainty and must ultimately rest in the realm of opinion, estimate and judgment.’ " Id. at 608, quoting Assessors of Quincy v. Boston Consol. Gas Co., 309 Mass. 60, 72 (1941).
As we affirm the judge's decision on the grounds of mutual mistake, we need not address the judicial estoppel issue, although the plaintiff's failure to list the subject property in his 2013 filing for bankruptcy where he was instructed to list "all real property in which [he] has any legal, equitable, or future interest" is some additional evidence that he did not believe that his family owned the property.
2. Cross appeal. We review an order allowing or denying a "motion to alter or amend for an abuse of discretion." Quarterman v. Springfield, 91 Mass. App. Ct. 254, 260 (2017). We will find an abuse of discretion only where a "judge made ‘a clear error of judgment in weighing’ the factors relevant to the decision, such that the decision falls outside the range of reasonable alternatives." Hoegen v. Hoegen, 89 Mass. App. Ct. 6, 9 (2016), quoting L.L. v. Commonwealth, 470 Mass. 169, 185 n.27 (2014).
The defendants challenge only the trial judge's refusal to declare that they are record title holders of lot 14, which they obtained by (if nothing else) adverse possession. The judge denied this relief on the ground that "record title to Lot 14 was not tried and because the ownership of Lot 14 was not a separate count of the ... counterclaim." In fact, the defendants did request this declaration as count 1 of their counterclaim.
Furthermore, the evidence at trial demonstrated that the defendants have good record title to lot 14. " ‘[G]ood and clear record title’ [is] defined as ‘a title which on the record itself can be again sold as free from obvious defects, and substantial doubts.’ " King v. Stephens, 9 Mass. App. Ct. 919, 920 (1980), quoting O'Meara v. Gleason, 246 Mass. 136, 138 (1923). The evidence at trial demonstrates that Carrie Luce transferred all of her interest in any land that she owned in West Tisbury by the 1964 deed to Ernest A. and Margaret Medeiros. Both the deed doing so and testimony regarding the circumstances of that deed were placed in evidence. The substantial claim that the plaintiff had to lot 14 was extinguished by his stipulating to the defendants’ adverse possession of the lot. Accordingly, the judge erred in not declaring that the defendants have good record title to lot 14. This declaration, of course, will be binding only on the parties to the lawsuit and those in privity with those parties. See Paull v. Kelly, 62 Mass. App. Ct. 673, 676 n.8 (2004).
3. Conclusion. For the reasons set out above, we modify the judgment on count 1 of the counterclaim to provide that the defendants hold record title to lot 14. As so modified, the judgment is affirmed.
So ordered.
affirmed as modified