Opinion
No. 15–P–1478.
09-22-2016
Joao C. BETTENCOURT & others v. TRUSTEES OF the SASSAQUIN VILLAGE CONDOMINIUM TRUST & another.
MEMORANDUM AND ORDER PURSUANT TO RULE 1:28
The plaintiffs, Joao C. Bettencourt, Daniel R. Luisi, Jr., and Nelson P. Torres, own condominiums in the Sassaquin Village Condominium complex (Sassaquin Village) in New Bedford. They filed a complaint against the trustees of the Sassaquin Village Condominium Trust (trustees) for breach of fiduciary duty based on the trustees' general mismanagement of Sassaquin Village. The plaintiffs' complaint included claims against another unit owner, Maryjane Cummings (who is also one of the trustees), alleging trespass and nuisance due to second-hand smoke entering the common areas of the complex. A Superior Court judge allowed the defendants' motions to dismiss the complaint pursuant to Mass.R.Civ.P. 12(b)(6), 365 Mass. 755 (1974), and judgment entered in favor of the defendants. This appeal ensued.
The individual trustees are Maryjane Cummings, Robert L. Carroll, and Nancy Cronan.
As to the trustees, the plaintiffs also sought specific performance and a declaratory judgment as to the validity of the trustees' actions, and alleged negligent infliction of emotional distress and negligence.
We note that after the defendants filed their motions to dismiss and a hearing on those motions was held, the plaintiffs filed a motion to amend the complaint, but no action was taken on that motion.
Facts. “The complaint alleges the following facts, which we accept, together with any favorable inferences reasonably drawn therefrom, as true for the purposes of this appeal.” Eigerman v. Putnam Invs., Inc., 450 Mass. 281, 282 (2007). The plaintiffs each own and reside in separate units in Sassaquin Village, a twelve-unit condominium complex. The trustees, who also each own and reside in separate units, were elected by a majority of the unit owners to serve on the governing body of Sassaquin Village.
The only facts we consider in deciding a motion to dismiss are those drawn from factual allegations set forth in the complaint or within attached exhibits. Eigerman, supra at 285 n. 6. Here, in addition to the complaint, we consider the exhibits appended to the complaint, which include the declaration of trust and the incorporated by-laws.
In May, 2014, without holding a general vote on the matter, the trustees executed a contract with a paving company to add a top coat of asphalt to the Sassaquin Village parking lot. The work also included the paving of a section of an adjacent lot owned by a separate entity. The trustees levied a special assessment of $950 on each unit to pay for the project. The plaintiffs initially refused to pay, claiming that they were entitled to vote on the contract. The trustees then put a lien on each plaintiff's property and commenced enforcement actions in the District Court. Ultimately, the assessments were paid.
In counts four and five of the complaint, the plaintiffs allege that the assessment for the cost of the pavement project was levied in violation of the Sassaquin Village by-laws (by-laws). In counts one, two, three, and six, the plaintiffs allege that the trustees refused to produce trust documents on request as required by the by-laws, improperly assessed certain fees on various occasions, failed to hold meetings, and improperly installed surveillance cameras that monitor the residents rather than provide security. In counts nine and ten, the plaintiffs allege negligent infliction of emotional distress by the trustees and that the trustees' negligence resulted in damages to the plaintiffs.
As to the claims against Cummings individually, the plaintiffs allege in counts eleven and twelve that Cummings smokes inside her unit, which results in second-hand smoke and the smell of smoke lingering in the common areas. The plaintiffs contend that the second-hand smoke is a health hazard and interferes with the use and enjoyment of their property.
Discussion. “We review the allowance of a motion to dismiss de novo.” Curtis v. Herb Chambers I–95, Inc., 458 Mass. 674, 676 (2011).
1. The trustees' motion to dismiss. The trustees moved to dismiss counts one through ten of the complaint on the ground that the plaintiffs lacked standing to bring derivative claims on behalf of Sassaquin Village because they did not obtain, as the by-laws require, approval for the lawsuit from eighty percent of the unit owners. The by-law at issue states that unit owners may not bring a lawsuit “as to any course of action involving the common areas or facilities or arising out of the enforcement of the [b]ylaws, [r]ules and [r]egulations, and [m]aster [d]eed, and this [t]rust” without first obtaining the consent of “not less than eighty percent” of unit owners (consent requirement). The trustees also argued that they owed no fiduciary duties to the individual unit owners but only to “the condominium trust.”
It is undisputed that the plaintiffs did not obtain consent from eighty percent of the unit owners to bring this lawsuit. They contend, however, that they are entitled to bring suit because the consent requirement is unconscionable and void as against public policy. Although our review is de novo, we agree with the reasoning of the motion judge who, in a written memorandum of decision, concluded that the consent requirement is valid and the plaintiffs' failure to comply with it mandates dismissal of their derivative claims.
First, as the motion judge noted, the plaintiffs concede that they knowingly and voluntarily agreed to the consent requirement when they purchased their units. Second, like the motion judge, we discern no basis for concluding that the provision is unconscionable. “To prove that the terms of a contract are unconscionable, a plaintiff must show both substantive unconscionability (that the terms are oppressive to one party) and procedural unconscionability (that the circumstances surrounding the formation of the contract show that the aggrieved party had no meaningful choice and was subject to unfair surprise).” Machado v. System4 LLC, 471 Mass. 204, 218 (2015), quoting from Storie v. Household Intl., Inc., U.S. Dist. Ct., No. 03–40268 (D.Mass. Sept. 22, 2005).
Other than asserting that it is mathematically impossible to obtain the consent of eighty percent of the unit owners, the plaintiffs have not identified any aspect of the consent requirement that is substantively or procedurally unfair. As we have noted, the plaintiffs were aware of the consent requirement when they bought their respective units. In addition, nothing in the consent requirement precludes the plaintiffs from persuading other unit owners and one or more of the trustees to consent to a lawsuit. Moreover, because the consent requirement applies to all unit owners, including the trustees, it is not “one-sided” as the plaintiffs claim. Having concluded that the consent requirement is not unconscionable, it follows that it does not offend public policy.
The gist of the plaintiffs' argument is that because the trustees comprise twenty-five percent of the unit owners, the unit owners are incapable of seeking relief in court for any of the trustees' conduct as long as the trustees refuse to consent to any lawsuit against them.
The plaintiffs' argument that the consent requirement violates art. 11 of the Massachusetts Declaration of Rights because it effectively curtails the plaintiffs' right to seek redress from the courts also fails, if only because constitutional rights may be waived by contract. See Chase Commercial Corp.v. Owen, 32 Mass.App.Ct. 248, 251–252 (1992) (“The right to a jury trial may ... be waived by contract”). See also Spence v. Reeder, 382 Mass. 398, 411 (1981) (listing examples of constitutional rights that may be waived).
Article 11 of the Declaration of Rights states: “Every subject of the [C]ommonwealth ought to find a certain remedy, by having recourse to the laws, for all injuries or wrongs which he may receive in his person, property, or character. He ought to obtain right and justice freely, and without being obliged to purchase it; completely, and without any denial; promptly, and without delay; conformably to the laws.”
We further conclude, as did the motion judge, that the trustees do not owe a fiduciary duty to any individual unit owner. See Office One Inc. v. Lopez, 437 Mass. 113, 125 (2002) (“[A]s a matter of law, members of a governing board of a condominium association in the capacity of the trustees here, owe no fiduciary duty to individual condominium unit owners”).
Our analysis differs from that of the motion judge with respect to the plaintiffs' assertion that they may, without regard to their standing to bring a derivative claim on behalf of Sassaquin Village, seek a judicial determination of the validity of the assessment and fees levied against them. We agree that under Blood v. Edgar's Inc ., 36 Mass.App.Ct. 402 (1994), the plaintiffs have the right to bring a lawsuit to challenge whether certain fees and the assessment for the cost of the paving job were properly levied within the powers granted to the trustees by the by-laws and the declaration of trust. In Blood, we held that “aggrieved unit owners should timely pay—under protest—the common expense assessment. Thereafter, a judicial determination of the legality of the assessment, and suitable reimbursement, may be sought.” Id. at 406. The plaintiffs have alleged sufficient facts in their complaint to show that they have followed the procedure outlined in Blood and, therefore, if the plaintiffs' allegations that they have paid the assessments and fees under protest are taken as true, they have stated a claim upon which relief can be granted. Accordingly, counts two, four, and five should not have been dismissed.
2. Cummings's motion to dismiss. In dismissing counts eleven and twelve, the motion judge ruled that the plaintiffs lack standing to bring their trespass and nuisance claims against Cummings individually because the only alleged harm is to the common areas of Sassaquin Village, not to the plaintiffs' private property. The motion judge determined that the by-laws require that an action against a unit owner for trespass or nuisance with respect to the common areas must be brought by the trustees. Our de novo review leads us to the same conclusion. See Berish v. Bornstein, 437 Mass. 252, 263 (2002), citing G.L. c. 183A, § 10(b)(4) (“[C]ondominium unit owners cede the management and control of the common areas to the organization of unit owners, which is the only party that may bring litigation relating to the common areas of the condominium development on their behalf”).
3. Cummings's request for appellate attorney's fees. Cummings claims that she is entitled to her appellate attorney's fees because the plaintiffs' appeal as to her individually is frivolous within the meaning of Mass.R.A.P. 25, as appearing in 376 Mass. 949 (1979). We agree. Accordingly, Cummings may file her application for appellate attorney's fees with supporting documentation within fourteen days of the date of the rescript. See Fabre v. Walton, 441 Mass. 9, 10–11 (2004). The plaintiffs then will have fourteen days thereafter to respond.
4. Conclusion. So much of the judgment that dismisses counts two, four, and five is reversed, and the case is remanded to Superior Court for further proceedings on those counts. In all other respects, the judgment is affirmed.