Opinion
11-P-916
04-11-2012
KATHLEEN A. BROWN, individually and as executrix, v. DAVID L. MARONE.
NOTICE: Decisions issued by the Appeals Court pursuant to its rule 1:28 are primarily addressed to the parties and, therefore, may not fully address the facts of the case or the panel's decisional rationale. Moreover, rule 1:28 decisions are not circulated to the entire court and, therefore, represent only the views of the panel that decided the case. A summary decision pursuant to rule 1:28, issued after February 25, 2008, may be cited for its persuasive value but, because of the limitations noted above, not as binding precedent.
MEMORANDUM AND ORDER PURSUANT TO RULE 1:28
The defendant, David L. Marone, appeals from the denial of his motion for judgment notwithstanding the verdict after a Superior Court jury awarded the plaintiff, Kathleen Brown, $100,000 plus interest. We affirm.
Procedural background. The plaintiff filed a complaint on March 24, 2010, seeking, under several equitable theories, $100,000 of insurance proceeds. Following trial in December, 2010, the jury found, under a promissory estoppel claim, that the plaintiff 'relied on a promise made by [Marone] to her damage'; that Marone, under an unjust enrichment claim, was 'unjustly enriched to the detriment of the plaintiff'; that Marone 'breach[ed] his fiduciary duty to the plaintiff'; and 'exercised undue influence over the plaintiff.' The jury awarded the plaintiff damages of $100,000.
The plaintiff alleged in her complaint that Dennis and Marone had a verbal contract to change designation of beneficiaries in August, 2007. The jury rejected the plaintiff's claim of a contract between the plaintiff and Marone. However, the jury found that there was a contract between Dennis and Marone, but that Marone did not breach it. The parties do not dispute the disposition of these contract claims in this appeal.
Discussion. We consider Marone's challenge to the denial of his motion for judgment notwithstanding the verdict under the well known standard of review for such motions. We determine whether 'anywhere in the evidence, from whatever source derived, any combination of circumstances could be found from which a reasonable inference could be drawn in favor of the plaintiff.' Doe v. Senechal, 66 Mass. App. Ct. 68, 76 (2006), quoting from Raunela v. Hertz Corp., 361 Mass. 341, 343 (1972).
1. The promissory estoppel claim. The plaintiff asserted in her verified complaint that she relied on representations of Marone that he would turn over to her any proceeds he received from Dennis's life insurance. 'Circumstances that may give rise to an estoppel are (1) a representation intended to induce reliance on the part of a person to whom the representation is made; (2) an act or omission by that person in reasonable reliance on the representation; and (3) detriment as a consequence of the act or omission.' Bongaards v. Millen, 440 Mass. 10, 15 (2003). 'Reduced to basic terms, promissory estoppel ' consists simply of a promise that becomes enforceable because of the promisee's reasonable and detrimental reliance.' Rooney v. Paul D. Osborne Desk Co., 38 Mass. App. Ct. 82, 83 (1995).' Suominen v. Goodman Industrial Equities Mgmt. Group, LLC, 78 Mass. App. Ct. 723, 731 (2011) (Suominen).
From our review of the trial record we determine that the jury could have found the following evidence.
Much of the testimony of the plaintiff involved objected-to hearsay, which the judge restricted as state of mind evidence and repeatedly instructed the jury accordingly.
In 2005, after consulting a self-employed insurance broker, Lisa Van, Dennis and Marone, who were business partners, decided to change from universal life to term insurance policies. The policies of each partner had a death benefit of $200,000. Dennis and Marone each named his respective spouse as a one-half beneficiary and the other partner as a one-half beneficiary. After being diagnosed with brain cancer, Dennis began to withdraw from the business in July, 2007, to qualify for social security disability income benefits. He asked Marone to remove him as a beneficiary of his (Marone's) insurance policy. Marone amended his policy through Lisa Van in September, 2007, naming his wife as primary beneficiary. Because Van expected policies of this kind to mirror each other in most instances, she asked Marone about Dennis, and understood he would be contacting her later. Dennis did not initiate any change in his policy before he died.
The plaintiff long had been aware that Dennis and Marone had 'key man' policies. She was not aware of the change in 2005 to term insurance, but after Dennis's cancer diagnosis in 2007, he gave her a folder to hold which, he stated, contained an insurance policy as well as a memorandum he described as his agreement to withdraw from the business. While the plaintiff put the folder in a drawer without reading the contents, she understood she was to receive $200,000 when Dennis died.
After Dennis died, the plaintiff learned from the insurance company that she was not the sole beneficiary, but a one-half beneficiary with Marone. After contacting Marone, she understood that Dennis should have amended his policy to mirror his, but had not. After another telephone conversation with Marone, she understood that if he received the death benefit as beneficiary under Dennis's policy he would transfer to her the $100,000 proceeds as a gift.
The plaintiff consulted Lisa Van and discussed the option of taking action in court. At that time the plaintiff understood that if she wanted to contest the disbursement to Marone she should not sign the forms and could file a court action. Facing dire financial circumstances resulting from Dennis's illness, she did not want to risk a delay in obtaining the proceeds. She decided to rely on Marone's assurances and seek disbursement of their respective beneficiary shares. After Van obtained Marone's signature, the plaintiff forwarded forms to the insurer requesting disbursement of the proceeds.
Marone asked that the $100,308.90 he received be held in escrow. He sought advice from an accountant and tax preparer, who proposed a two-payment gift plan which would avoid gift taxes. However, Marone never initiated any payment.
From this evidence the jury could infer that Marone's agreement to collect the proceeds and give them to the plaintiff constituted a promise that reasonably induced 'forbearance of a substantial character.' Cannon v. Cannon, 69 Mass. App. Ct. 414, 422 (2007). The plaintiff refrained from taking legal action against the insurer or Marone. Such forbearance may constitute legal detriment without the need to demonstrate its ultimate viability. Suominen, 78 Mass. App. Ct. at 733-734 n.12. See Stevens v. Nagel, 64 Mass. App. Ct. 136, 138 (2005).
2. The unjust enrichment claim. The equitable remedy of unjust enrichment is defined as 'retention of money or property of another against the fundamental principles of justice or equity and good conscience.' Taylor Woodrow Blitman Constr. Corp. v. Southfield Gardens Co., 534 F.Supp. 340, 347 (D. Mass. 1982), quoted in Santagate v. Tower, 64 Mass. App. Ct. 324, 329 (2005), and cases cited. 'A person who is unjustly enriched at the expense of another is subject to liability in restitution.' Restatement (Third) of Restitution and Unjust Enrichment § 1 (2011). There was sufficient evidence that Marone retained the insurance proceeds after he received them, and the jury could infer that he was unjustly enriched to the plaintiff's detriment by retaining them.
3. The breach of fiduciary duty claim. Partners owe one another the duties of 'utmost good faith and loyalty.' Cardullo v. Landau, 329 Mass. 5, 8 (1952). 'As a fiduciary, a partner must consider his or her partner['s] welfare, and refrain from acting for purely private gain.' Meehan v. Shaughnessy, 404 Mass. 419, 434 (1989). When Dennis withdrew from the partnership, Marone removed Dennis as a beneficiary of his policy, and agreed to pay the premiums on Dennis's policy. Dennis neither asked for nor received any other benefit from the partnership. In the circumstances where Marone was aware that Dennis failed to change his policy to mirror his, the jury reasonably could infer that Marone breached his fiduciary duty as a partner in claiming a share of the death benefit proceeds of Dennis's policy.
4. The undue influence claim. There is insufficient evidence to support the jury's verdict that Marone exercised undue influence over the plaintiff. No evidence appears that he did not cooperate in obtaining payment from the insurer or that he exploited her financial situation. His later refusal to transfer the proceeds is actionable under other theories. In any event, because '[a] plaintiff may seek recovery under multiple counts but may not recover cumulative, duplicate damages from those counts,' Fox v. F & J Gattozzi Corp., 41 Mass. App. Ct. 581, 588 (1996), the loss of this claim does not affect the judgment.
5. Stock transfer. Marone asserts that the judge neglected to rule on his counterclaim seeking an order that the plaintiff transfer Dennis's outstanding stock in Foreign Cars of Reading. There is no indication that this issue was raised and acted upon during the trial and no record concerning this issue has been submitted in this appeal. Without such a record we decline to consider it.
6. Other issues. There are other contentions of Marone in his brief at pages 38 to 49 which we have not overlooked, but do not address because there is 'nothing in them that requires discussion.' Department of Rev. v. Ryan R., 62 Mass. App. Ct. 380, 389 (2004), quoting from Commonwealth v. Domanski, 332 Mass. 66, 78 (1954). See also Mass.R.A.P. 16(a)(4), as amended, 367 Mass. 921 (1975).
6. Attorney's fees and costs. We deny Marone's request for costs, and allow the plaintiff's request for attorney's fees and costs for defending this appeal, pursuant to Yorke Mgmt. v. Castro, 406 Mass. 17, 19 (1989). Within fourteen days following the date of the issuance of this decision, the plaintiff shall file with this court and serve a motion for the determination of the attorney's fees and costs incurred in defending this appeal, supported by a detailed affidavit, in accordance with the procedure specified in Fabre v. Walton, 441 Mass. 9, 10-11 (2004). Within fourteen days thereafter, Marone may file with this court and serve on the plaintiff an opposition.
Not disputed in this appeal is the propriety of the trial judge's denial of the plaintiff's request for attorney's fees, or his award of costs of $843.15.
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Judgment affirmed.
Order denying motion for judgment notwithstanding the verdict affirmed.
By the Court (Cypher, Katzmann & Grainger, JJ.),