Opinion
C.A. PM-2013-0350 PM-2013-5001
12-21-2020
NICHOLAS E. CAMBIO, Trustee, The Nichola E. Cambio, Roney A. Malafronte, and Vincent Cambio Trust, Petitioners v. COMMERCE PARK REALTY, LLC; COMMERCE PARK PROPERTIES, LLC; COMMERCE PARK COMMONS, LLC; COMMERCE PARK ASSOCIATES 4, LLC; and CATAPULT REALTY, LLC, Respondents MATTHEW J. MCGOWAN, as and only as Receiver for Commerce Park Realty, LLC, Commerce Park Properties, LLC, Commerce Park Commons, LLC, Commerce Park Associates 4, LLC, and Catapult Realty, LLC, Petitioners v. COMMERCE PARK MANAGEMENT, LLC, Respondent
Petitioners Brian LaPlante, Esq. Richard G. Riendeau, Esq. Michael J. Jacobs, Esq. RFP Defendants: HR2-A Corp. as General Partner of HR2-A Limited Partnership; HR4-A Corp., as General Partner of HR4-A Limited Partnership; MR4A-JV Corp., as General Partner of MR4A-JV Limited Partnership; Realty Financial Partners • Robert D. Wieck, Esq. D'Ambra Construction Company Inc. • William M. Russo, Esq. • David M. D'Agostino, Esq. • Nicholas Gorham, Esq. Vellano Bros. Inc. • Joseph J. Reale, Jr., Esq. 670 & 720 Coventry LLC • Burns & Levinson LLP • Richard Lumley, Esq. Benderson 85-1 Trust • Michael J. Lepizzera, Jr., Esq. • John A. Pagliarini, Jr., Esq. Ferguson Enterprises Inc. • Martin K. DeMagistris, Esq. Holland and Knight LLP • Brian J. Lamoureaux, Esq. • Matthew C. Reeber, Esq. Home Depot U.S.A., Inc. • Jeffrey S. Brenner, Esq. LR2-A Limited Partnership; LR4-A Limited Partnership; Realty Financial Partners • Preston W. Halperin, Esq. Linda Malafronte; Robin Pelleccione • Scott F. Bielecki, Esq. Potomac Realty Capital LLC • William J. Delaney, Esq. Daniel Palmier • Joseph V. Cavanagh III, Esq. RI Heritage Inn of West Greenwich LLC • Ronald K. Markoff, Esq. Roadepot, LLC • Zachary Berk, Esq. W. Mark Russo • John A. Dorsey, Jr., Esq. The Highlands at Hopkins Hill Condominium Association, Inc.; • Frank A. Lombardi, Esq. • Frederick C. Casavant, Esq. • Mary Joy A. Spencer, Esq. Village Green Condominium Association, Inc. • Frank A. Lombardi, Esq. • Dennis J. Roberts II, Esq. WIP Grandeville Apartments, LLC • Frank A. Lombardi, Esq. • Mary Joy A. Spencer, Esq. • Christine A. Murphy, Esq. The Washington Trust Company • Gardner H. Palmer, Esq. Wal-Mart Real Estate Business Trust; Wal-Mart Stores East, LP • Richard J. Land, Esq. RECEIVER • Matthew J. McGowan, Esq. • Elizabeth Lonardo, Esq., • R. Thomas Dunn, Esq. Commerce Park Management, LLC • William J. Delaney, Esq. INTERESTED PARTY: 670 & 720 Coventry LLC • Burns & Levinson LLP • Richard Lumley, Esq. Nicholas E. Cambio; CKLP, Inc.; Commercial Park Associates 2, LLC; Universal Truck & Equipment Leasing, Inc. • Richard G. Riendeau, Esq. Home Depot U.S.A., Inc. • Jeffrey S. Brenner, Esq., Realty Financial Partners • Robert D. Wieck, Esq. W. Mark Russo • John A. Dorsey, Jr., Esq.
Petitioners Brian LaPlante, Esq. Richard G. Riendeau, Esq. Michael J. Jacobs, Esq.
RFP Defendants: HR2-A Corp. as General Partner of HR2-A Limited Partnership; HR4-A Corp., as General Partner of HR4-A Limited Partnership; MR4A-JV Corp., as General Partner of MR4A-JV Limited Partnership; Realty Financial Partners • Robert D. Wieck, Esq. D'Ambra Construction Company Inc. • William M. Russo, Esq. • David M. D'Agostino, Esq. • Nicholas Gorham, Esq. Vellano Bros. Inc. • Joseph J. Reale, Jr., Esq.
670 & 720 Coventry LLC • Burns & Levinson LLP • Richard Lumley, Esq. Benderson 85-1 Trust • Michael J. Lepizzera, Jr., Esq. • John A. Pagliarini, Jr., Esq. Ferguson Enterprises Inc. • Martin K. DeMagistris, Esq. Holland and Knight LLP • Brian J. Lamoureaux, Esq. • Matthew C. Reeber, Esq. Home Depot U.S.A., Inc. • Jeffrey S. Brenner, Esq.
LR2-A Limited Partnership; LR4-A Limited Partnership; Realty Financial Partners • Preston W. Halperin, Esq. Linda Malafronte; Robin Pelleccione • Scott F. Bielecki, Esq. Potomac Realty Capital LLC • William J. Delaney, Esq. Daniel Palmier • Joseph V. Cavanagh III, Esq.
RI Heritage Inn of West Greenwich LLC • Ronald K. Markoff, Esq. Roadepot, LLC • Zachary Berk, Esq. W. Mark Russo • John A. Dorsey, Jr., Esq.
The Highlands at Hopkins Hill Condominium Association, Inc.; • Frank A. Lombardi, Esq. • Frederick C. Casavant, Esq. • Mary Joy A. Spencer, Esq.
Village Green Condominium Association, Inc. • Frank A. Lombardi, Esq. • Dennis J. Roberts II, Esq.
WIP Grandeville Apartments, LLC • Frank A. Lombardi, Esq. • Mary Joy A. Spencer, Esq. • Christine A. Murphy, Esq.
The Washington Trust Company • Gardner H. Palmer, Esq.
Wal-Mart Real Estate Business Trust; Wal-Mart Stores East, LP • Richard J. Land, Esq.
RECEIVER • Matthew J. McGowan, Esq. • Elizabeth Lonardo, Esq., • R. Thomas Dunn, Esq.
Commerce Park Management, LLC • William J. Delaney, Esq.
INTERESTED PARTY: 670 & 720 Coventry LLC • Burns & Levinson LLP • Richard Lumley, Esq.
Nicholas E. Cambio; CKLP, Inc.; Commercial Park Associates 2, LLC; Universal Truck & Equipment Leasing, Inc. • Richard G. Riendeau, Esq. Home Depot U.S.A., Inc. • Jeffrey S. Brenner, Esq., Realty Financial Partners • Robert D. Wieck, Esq. W. Mark Russo • John A. Dorsey, Jr., Esq.
DECISION
TAFT-CARTER, J.
Before this Court for decision are three motions: (1) HR2-A Corp. as General Partner of HR2-A Limited Partnership; HR4-A Corp., as General Partner of HR4-A Limited Partnership; MR4A-JV Corp., as General Partner of MR4A-JV Limited Partnership; and Realty Financial Partners' (RFP Defendants) Motion to Stay Pending Appeal; (2) Petitioner Nicholas E. Cambio's (Cambio), Trustee of the Nicholas E. Cambio, Roney A. Malafronte, and Vincent A. Cambio Trust, Cross-Motion for Stay Pending Cross-Appeal; and (3) the Receiver, Matthew J. McGowan's (Receiver), as Receiver for Commerce Park Realty, LLC, Commerce Park Properties, LLC, Commerce Park Commons, LLC, Commerce Park Associates 4, LLC, and Catapult Realty, LLC, Motion to Dismiss Cambio Parties' Appeal. The Receiver objected to both motions to stay and Cambio objected to the Receiver's motion to dismiss. The two motions to stay were heard remotely via WebEx on October 28, 2020. The motion to dismiss Cambio's appeal was heard remotely via WebEx on December 1, 2020. As common facts surround these three motions, the Court issues one decision for the purposes of judicial economy. This Court exercises jurisdiction pursuant to Article I, Rules 8(a) and 11(f) of the Supreme Court Rules of Appellate Procedure.
An additional motion and objection were heard on October 28, 2020. That motion-the RFP Defendants' Motion for Order Requiring Return of Fees-will be addressed in a separate decision by this Court.
I. Facts and Travel
The RFP Defendants move pursuant to Article I, Rule 8(a) of the Supreme Court Rules of Appellate Procedure and ask this Court to issue a stay pending appeal of the "Order Granting Receiver's Motion to Sell Property Free and Clear of Liens and Encumbrances (Approximately Two-Acre Parcel To Be Subdivided Out of West Greenwich Plat 1, Lot 4-3)" (West Greenwich Order) entered in this action on August 31, 2020 granting the Receiver's April 29, 2020 Motion to Sell Property Free and Clear of Liens and Encumbrances (April Motion). (RFP Defs.' Mot. to Stay Pending Appeal (RFP Defs.' Mot. to Stay) at 1-2.) The Order follows a Decision issued by this Court on July 27, 2020. Id. at 2. The West Greenwich Order authorized the sale of a two-acre parcel to be carved out of a 6.93-acre parcel of land.
Cambio has requested a stay of two orders, both issued on August 31, 2020. (Cambio's Cross-Mot. to Stay Pending Cross-Appeal (Cambio's Cross-Mot. to Stay) at 2.) The first order is the West Greenwich Order and the second order is the "Consent Order Regarding Water Project And Sale Of 29 Lots Within The Highlands" (29 Units Order) which finalized the 2018 provisional approval of the sale of 29 "land only units" in the Highlands at Hopkins Hill Condominium. The Receiver moved to dismiss only Cambio's appeal of the 29 Units Order.
A. The West Greenwich Order
The Centre of New England (CNE) is a development complex that contains various developed and undeveloped properties owned by the Receivership Entities. See Cambio v. Commerce Park Realty, LLC, Nos. PM-2013-0350, PM-2013-5001, 2020 WL 4456543, at *2 (R.I. Super. July 27, 2020) [the July 27 Decision]. The Receiver initially filed a Motion to Sell Property Free and Clear of Liens on November 26, 2019. Id. at *3. Then, on April 29, 2020, the Receiver filed an amended Motion along with a Notice of Hearing and Invitation for Competing Bids. Id. This Court held hearings on June 3 and June 24, 2020 for the April Motion. (West Greenwich Order at 2.) In between these hearings, on June 17, 2020, the Receiver filed a supplemental Motion addressing specific inquiries of the Court from the first hearing. July 27 Decision, 2020 WL 4456543, at *3.
In the July 27 Decision, this Court granted the Receiver's April Motion allowing the Receiver to sell the two acres "free and clear of all interests, claims, liens and encumbrances." Id. at *4. Additionally, this Court found that "[t]he terms of the Receiver's proposed sale to the Buyer, including the price, proposed subdivision, and Liquor Store Covenant, are reasonable and in the best interests of the estate." Id. Specifically, this Court was "satisfied that the Receiver exercised his business judgment in concluding that he could not sell the Primary Parcel." Id. at *3. The Primary Parcel encompassed 6.93 acres. The two-acre parcel was carved out of the Primary Parcel for the sale. This Court reasoned that the Receiver was "reasonable in concluding that sale of the larger parcel [was] not feasible" because "the Receiver 'engaged in substantial marketing efforts' to advertise and sell the entire Primary Parcel to no avail" and "engaged the experienced commercial brokerage firm" to try and market and sell undeveloped property at the CNE, including having the Primary Parcel listed on the brokerage firm's website for eight months. Id. at *3.
This Court then entered the West Greenwich Order on August 31, 2020. The Order stated that "[f]or the reasons expressed in the [July 27 Decision], the Court finds that the Receiver's proposed sale of the Property is commercially reasonable and in the best interests of the receivership estate[.]" (West Greenwich Order ¶ 5.)
B. The 29 Lots Order
On August 2, 2018, this Court entered an order entitled "Order Provisionally Granting Receiver's Motion to Sell Property Free and Clear of Liens, Claims and Encumbrances (29 Vacant Lots in Highlands)" (Provisional Granting Order). The Provisional Granting Order's approval of the sale of 29 lots was
"subject to the Receiver reaching an agreement with the Highlands at Hopkins Hill Condominium Association (the "Association") as to the claims and interests of the Association or, failing that, the Court ordering an appropriate amount from the proceeds paid at the closing on the sale of this court-approved sale being set aside in respect to the claims of the Association." (Provisional Granting Order ¶ 1.)
The Provisional Granting Order further required that "a second order from the Court, referencing this Order," be entered "ordering and directing that such condition has and shall be deemed to have been fully satisfied." Id.
On August 31, 2020, this Court entered the 29 Units Order, in which the Court stated that "the Association and the Receiver" agreed to "work towards finalizing a further resolution that will settle and resolve all of their remaining respective claims and issues related to the Highlands." (29 Units Order ¶ L.) The 29 Units Order set out various items that the parties further agreed to, such as directing a certain amount of money be given to the Association upon "the closing on the Receiver's sale of the 29 Lots." Id. ¶ 7.
The RFP Defendants filed a Notice of Appeal on September 18, 2020 followed by a Motion to Stay on September 23, 2020. In that Notice of Appeal, the RFP Defendants stated that they were appealing the "8/31/2020 (Order re Approx. Two-Acre to be Subdivided)." On October 8, 2020, Cambio filed his Notice of Appeal, in which it was stated that the appeal was from the "8/31/2020 (Orders re Sale of 29 Lots and 2 Acre Lot)." Also typed on the form was the following: "NOTE: Cross-Appeal from 9/18/2020 Notice of Appeal." Cambio brought his Cross-Motion to Stay on October 19, 2020.
Additionally, "the Receiver's Deed conveying the 29 vacant lots. . . to the buyer of such lots was signed and delivered on October 8, 2020, and was received in the land evidence records of the Town of Coventry, Rhode Island the next morning, October 9, 2020." (Suppl. to Receiver's Obj. to Cambio's Cross-Mot. to Stay at 2.)
II. Standards of Review
A. Motion to Dismiss Pending Appeal
Article I, Rule 11(f) of the Supreme Court Rules of Appellate Procedure provides the following, in pertinent part:
"From the time of the filing of notice of appeal, the Supreme Court and trial courts shall have concurrent jurisdiction to supervise the course of said appeal and to promulgate orders of dismissal of appeal for failure to comply with these rules, either upon motion of a party or upon the court's own motion."
The Supreme Court has "exclusive jurisdiction to supervise the further course of such appeal and enter such orders as may be appropriate, including orders of dismissal for failure to comply with these rules" once the appeal has been docketed in the Supreme Court. Sup. Ct. Rules App. Proc. Art. I, Rule 11(f). As of the date of this Decision, Cambio's appeal of the 29 Units Order has not been docketed in the Supreme Court.
B. Motion to Stay Pending Appeal
Article I, Rule 8(a) of the Supreme Court Rules of Appellate Procedure models the Federal Rule. Therefore the Rhode Island Supreme Court will look to federal cases "for guidance with respect to the decision whether to grant a stay." Town of North Kingstown v. International Association of Firefighters, Local 1651, AFL-CIO, 65 A.3d 480, 481 (R.I. 2013) (mem.). The Rhode Island Supreme Court has held that a stay will not be issued
"unless the moving party makes a 'strong showing' that (1) it will prevail on the merits of its appeal; (2) it will suffer irreparable harm if the stay is not granted; (3) no substantial harm will come to other interested parties; and (4) a stay will not harm the public interest." Id. (quoting Narragansett Electric Co. v. Harsch, 367 A.2d 195, 197 (R.I. 1976)).
These four factors should be considered. However, "'[they] are not prerequisites that must be met, but are interrelated considerations that must be balanced together.'" Id. (quoting Service Employees International Union Local 1 v. Husted, 698 F.3d 341, 343 (6th Cir. 2012)). Further,
"'[t]he sine qua non [of the stay pending appeal standard] is whether the [movants] are likely to succeed on the merits.' In essence the issuance of a stay depends on 'whether the harm caused [movant] without the [stay], in light of the [movant's] likelihood of eventual success on the merits, outweighs the harm the [stay] will cause [the non-moving party].'" Acevedo-García v. Vera-Monroig, 296 F.3d 13, 16-17 (1st Cir. 2002) (internal citations omitted) (alternations in original).
III. Analysis
A. Receiver's Motion to Dismiss Cambio's Appeal
The Receiver argues that the Cambio appeal of the 29 Units Order should be dismissed because (1) the appeal is moot due to the sale of the 29 lots closing and (2) the notice of this appeal was untimely. With respect to the mootness argument, the Receiver asserts that the appeal is moot because the sale of the subject property in the 29 Units Order has closed. The Receiver contends that the sale of real property during the pendency of an appeal concerning its deposition renders the appeal moot. (Receiver's Obj. to Cambio's Cross-Mot. to Stay at 5.) Additionally, the Receiver "refutes" Cambio's "suggestion" that the Receiver acted inappropriately by closing on the sale while Cambio was seeking an appeal. (Receiver's Mot. Dismiss Cambio's Appeal at 4.) The Receiver asserts that the Deed was "signed and delivered" to the buyer on October 8, 2020 and recorded the next morning. Id. at 4. Furthermore, it is unreasonable for Cambio to suggest that the Receiver was on notice and acted inappropriately when he filed his notice of appeal on October 8, 2020. This Court agrees with the Receiver's position that notice "could not have been received by the Receiver or anyone else sometime thereafter, following it being served." Id. at 5.
The Receiver also asserts that Cambio appears to be manipulating the appeal of the 29 Units Order as an "indirect means to challenge and effectively seek to 'appeal'" the previous Provisional Granting Order. (Receiver's Obj. to Cambio's Cross-Mot. to Stay at 4-5.) The Receiver contends that it is the Provisional Granting Order that actually authorized the Receiver to sell the 29 lots, and because no party ever filed an appeal of that Order, Cambio cannot attempt to use the 29 Units Order to "challenge indirectly the right of the Receiver to sell the 29 Lots." Id.
Second, the Receiver argues that Cambio failed to file his Notice of Appeal within the mandatory twenty-day deadline. (Receiver's Mot. Dismiss Cambio's Appeal at 5.) The Receiver asserts that the 29 Units Order was entered on August 31, 2020, and Cambio's Notice of Appeal was not filed until October 8, 2020. Id. at 6. Further, the Receiver contends that Cambio is attempting to "ride the coattails" of the RFP Defendants' Notice of Appeal filed on September 18, 2020. Id. at 7. The Receiver reasons that because the RFP Defendants did not appeal the 29 Units Order, Cambio cannot file a cross-appeal from that Notice of Appeal. Id. The RFP Defendants' Notice of Appeal states that the appealable issue is the West Greenwich Order (authorizing the sale of the two-acre parcel). Id. at 7-8. The Receiver argues that the provision in Article I, Rule 4 of the Supreme Court Rules of Appellate Procedure that allows for a party to file a cross-appeal within twenty days of receiving a notice of appeal from another party to the action, does not pertain to the Cambio's purported "cross-appeal" because no other party has appealed from the 29 Units Order. Id. at 8. The Receiver argues that the provision in Article I, Rule 4 of the Supreme Court Rules of Appellate Procedure-which allows for a party to file a cross-appeal within twenty days of receiving a notice of appeal from another party to the action-does not pertain to the Cambio's purported "cross-appeal" in this case because no other party has appealed from the 29 Units Order. Id. at 8. The Receiver argues that to allow Cambio to appeal the 29 Units Order based on the RFP Defendants' notice of appeal would "wreak havoc." Id. Cambio's interpretation of Rule 4 is "illogical and unreasonable (and will undercut the finality, predictability, and reliability of sale orders[).]" Id.
In response, Cambio argues that the Receiver's mootness argument is "baseless" because under G.L. 1956 § 9-24-7, Cambio has a statutory right to appeal the 29 Units Order, as this Court still has the ability to stay the distribution of the sale proceeds. (Cambio's Obj. to Receiver's Mot. Dismiss Cambio's Appeal at 7.) Additionally, Cambio argues that his Notice of Appeal was in fact timely under the Supreme Court Rules of Appellate Procedure. In support, Cambio cites to the Rhode Island Supreme Court's decision in Miller v. Metropolitan Property and Casualty Insurance Co., 88 A.3d 1157 (R.I. 2014), and a number of federal cases for the proposition that a cross-appeal can be from "any" order so long as it is brought within twenty days of an adverse parties' notice of appeal and the cross-appeal is not limited to an order from which the original appeal was taken. Id. at 5. Finally, Cambio disputes the Receiver's contention that Cambio is attempting to appeal the earlier Provisional Granting Order rather than the 29 Units Order. Cambio argues that the Provisional Granting Order was subject to the satisfaction of conditions precedent, including the requirement that the Court obtain a "second order," and thus, the Provisional Granting Order only became final, and therefore appealable, at the entry of the 29 Units Order. Id. at 7.
Pursuant to Article I, Rule 4(a) of the Supreme Court Rules of Appellate Procedure, the period allowed for filing a notice of appeal is twenty days following "the date of the entry of the judgment, order, or decree appealed from[.]" "'It is well settled that the time specified in Rule 4(a) is mandatory, and that once the prescribed time has passed there can be no review by way of appeal.'" Pawtucket Redevelopment Agency v. Brown, 106 A.3d 893, 899 (R.I. 2014) (quoting Iozzi v. City of Cranston, 52 A.3d 585, 588 (R.I. 2012)) (internal quotations omitted); see also id. at 900 (stating that Rule 3(a) of the Supreme Court Rules of Appellate Procedure, which requires that a notice of appeal be filed, "makes clear that a failure to file a timely notice of appeal renders any purported appeal invalid").
Further, Rule 4(a) states, in pertinent part, that
"If a timely notice of appeal is filed by a party, any other party may file a notice of appeal within twenty (20) days of the date on which the first notice of appeal was filed, . . . or within the time otherwise prescribed by this subsection, whichever period last expires."
This rule has been interpreted to mean that once a notice of appeal has been filed, the deadline essentially resets and "the rule should be interpreted to provide a twenty-day appeal period after the first timely notice of appeal from an adverse party." Miller, 88 A.3d at 1161 (emphasis in original).
Further, the Rhode Island Supreme Court has noted that "the introductory language of this Court's Rules of Appellate Procedure states that the rules are to be construed so as to 'promote the just, speedy and inexpensive determination of every matter[.]" Id. In Miller, the plaintiff had filed a notice of appeal on a certain order. The defendant then filed a notice of appeal of a decision and a different order (within the proper twenty-day deadline from entry of the decision and order), and the plaintiff then filed a cross-appeal from the same Decision that the defendant appealed from within twenty days of defendant's notice of appeal. Id. at 1159. The Court concluded that it would be an "unjust, illogical, and indeed absurd result" to interpret Rule 4(a) to mean that the plaintiff had to file the cross-appeal within twenty days of plaintiff's first notice of appeal and not within twenty days of the defendant's notice of appeal. Id. at 1162.
Here, the RFP Defendants, in their Notice of Appeal filed on September 18, 2020, indicated that they were only appealing the West Greenwich Order as their notice stated in the box labeled "Date of Judgment or Order Appealed From" the "8/31/2020 (Order re Approx. Two-Acre to be Subdivided." Cambio, on October 8, 2020, filed his Notice of Appeal and indicated that it was a "Cross-Appeal" from the September 18, 2020 Notice of Appeal. Cambio additionally stated in the "Date of Judgment or Order Appealed From" box that he was appealing from the "8/31/2020 (Orders re Sale of 29 Lots and 2 Acre Lot.)." While Cambio's "cross-appeal" of the West Greenwich Order was timely because it was within twenty days of the RFP Defendants' Notice of Appeal, his appeal of the 29 Units Order is untimely because his Notice of Appeal was not filed within twenty days of August 31, 2020, the date this Court entered the 29 Units Order. See Sup. Ct. Rules of App. Proc. Art. I, Rule 4(a).
Cambio points to Federal Circuit Court of Appeals cases to support his argument that a cross-appeal can be from any judgment or order. According to Cambio, it is therefore not required that the particular judgment or order be "from which the original appeal was taken." (Cambio's Obj. to Receiver's Mot. to Dismiss Cambio Appeal at 5.) However, this Court cannot agree with Cambio's proposed interpretation of Rule 4(a). For example, the Tenth Circuit Court of Appeals in Woodruff v. Covington, 389 F.3d 1117 (10th Cir. 2004) held that where two parties filed notices of appeal of separate orders, the second notice of Appeal was timely under the Federal Rule because it was within fourteen days of the first timely notice of appeal. Woodruff, 389 F.3d at 1121. However, in that case, the Tenth Circuit stated that it was using a "broad interpretation" of the rule. Id. This Court is required to read and construe Rule 4(a) to "'promote the just, speedy and inexpensive determination'" of this matter. Miller, 88 A.3d at 1161 (quoting Greensleeves, Inc. v. Smiley, 942 A.2d 284, 291 n.12 (R.I. 2007)).
In Miller, the Rhode Island Supreme Court stated that the purpose of Rule 4(a) is "'to allow all parties an opportunity to see and respond to the actions of their adversaries.'" Id. (quoting Lee v. Coahoma County, Mississippi, 937 F.2d 220, 223 (5th Cir. 1991)). Here, Cambio is not responding to an adversary by appealing the 29 Units Order, as no party before him has appealed that Order. Although Cambio characterizes his appeal of both orders as a "cross-appeal," the only proper cross-appeal would be from the West Greenwich Order and not the 29 Units Order. What Cambio is attempting to accomplish is appeal two separate and distinct orders under the guise of a cross-appeal. If allowed, the time limitation governing appeals as set forth in the Rules would have no meaning.
Further, in Miller, the Supreme Court stated that "[a]lthough the twenty-day appeal period is jurisdictional and may not be waived absent a finding of excusable neglect … we are constrained to conclude that a literal interpretation of Rule 4(a) in this context would lead to an unjust, illogical, and indeed absurd, result." Id. at 1162 (internal citation omitted). In the context of that case, the literal interpretation was an "unjust" result because, in a literal reading, "one party could foreclose another from filing a cross-appeal simply by waiting until the final day of the second appeal period to file his notice of appeal." Id. However, here, the "context" and the facts of the case are different from those in Miller. In the context of this case, which involves long and complex receivership proceedings, allowing Cambio to appeal from both the West Greenwich Order and the 29 Units Order would lead to "an unjust, illogical, and indeed absurd, result." See id. Specifically, as the Receiver has pointed out, allowing Cambio to bring an appeal of the 29 Units Order would allow for a party to bring an appeal on essentially anything with respect to any court order or judgment, no matter how long ago it occurred, so long as that party filed the unrelated notice of "cross-appeal" within twenty days of an adverse party's filing of notice of appeal in the case. This Court concurs with the Receiver that allowing for such an interpretation would "wreak havoc." A strict reading of the mandatory timing rules requires this Court to conclude that Cambio's Notice of Appeal is untimely.
Therefore, based on the strict and "mandatory" timing rules provided in Rule 4(a), Cambio's appeal from the 29 Units Order is dismissed because the Notice of Appeal was filed on October 8, 2020, well after twenty days from the entry of the August 31, 2020 29 Units Order. Cambio's cross-appeal from the West Greenwich Order, however, was timely because it was within twenty days of the RFP Defendants' September 18, 2020 Notice of Appeal. This Court will grant the Receiver's Motion to Dismiss Cambio's Appeal from the 29 Units Order as untimely. See Pawtucket Redevelopment Agency, 106 A.3d at 899 ("[O]nce the prescribed time has passed there can be no review by way of appeal.").
It is noted that the Receiver did put forth multiple arguments as to why the sale of the 29 lots render Cambio's Appeal of the 29 Units Order moot. The Receiver was providing his mootness arguments as one reason why his Motion to Dismiss should be granted. The untimely Notice of Appeal is another "avenue" in which this Court is taking to grant the Motion to Dismiss and, because the case law is clear that the timing requirements in Rule 4(a) are mandatory, this Court does not need to also engage in an analysis of whether the appeal is moot.
B. RFP Defendants' Motion to Stay Pending Appeal
As to their Motion to Stay Pending Appeal of the West Greenwich Order, the RFP Defendants argue that "on balance" the four factors that must be considered weigh in favor of the RFP Defendants. (RFP Defs.' Mot. to Stay at 3.) Specifically, the RFP Defendants argue: (1) they are likely to succeed on appeal because the record and documents in the case "indicate that Receiver's marketing efforts do not qualify as 'substantial' despite the Court's classification of them as such [in the July 27 Decision]"; (2) they will suffer irreparable harm if the stay is not granted because, if the subject real estate is sold prior to resolution of their appeal, the appeal will become moot; (3) no substantial harm will come to other interested parties if the stay is granted because the subject real estate can be sold quickly following the resolution of the appeal of the Order and the appeal of the June 2019 Decision, explained infra, by this Court ruling their liens usurious and void; and (4) there is no harm to public interest if a stay is granted because the "instant matter is between the Receiver and RFP Defendants. There is no public interest involved." Id. at 5-7.
In his objection, the Receiver disagrees that the RFP Defendants can satisfy the four prongs required. (Receiver's Obj. to RFP Defs.' Mot. to Stay at 8.) Specifically, the Receiver argues: (1) the RFP Defendants failed to make a "strong showing" that they would be successful on appeal because they only offered "a recap of the filings made in connection with the proposed sale" and stated "their overall general disagreement with the Court's ruling"; (2) the RFP Defendants have failed to show that they will be irreparably harmed because the RFP Defendants do not have any collateral in the assets of the receivership entities (because this Court previously found their loans to be usurious), so the RFP Defendants "cannot be harmed when the Receiver liquidates receivership property"; (3) "substantial harm" will come to the Receiver and other creditors because, if the stay is granted, "the sale of the Property may well be lost" as "[t]he reality of the COVID-19 pandemic is that the future of the commercial real estate market is uncertain and it will not serve the best interests of creditors by letting this sale slip away"; and (4) the stay will have an impact on the public's interest because the creditors are part of the public. Id. at 8-10.
In International Association of Firefighters, supra, the Rhode Island Supreme Court granted the Town of North Kingstown's motion to stay a trial court order pending the appeal of the trial court's issuance of an injunction. International Association of Firefighters, 65 A.3d at 481. The Supreme Court held that the town had made a "strong showing" that it would likely prevail on the merits of its appeal because "[a]t [that] stage," the Supreme Court deemed the issuance of the injunction improper "for several important reasons." Id. at 481-82. Those three reasons were: (1) neither party requested the issuance of the injunction; (2) the issuance was in direct contravention of "well-settled precedent"; and (3) the injunction was "ordered absent the requisite findings and without notice to the town, as required" by the Superior Court Rules of Civil Procedure. Id. at 482.
After determining there was a strong showing of success on the merits, the Court balanced the three factors and briefly addressed each one. Id. at 482-83. The Court pointed out that the remaining factors were "more equivocal"; however, the Court relied on the First Circuit's language in Acevedo-García and stated that "the issuance of [the] stay depends on whether the harm caused [to the town] without the [stay], in light of the [town's] likelihood of eventual success on the merits, outweighs the harm the [stay] will cause [the union]." Id. at 482 (quoting Acevedo-García, 296 F.3d at 16-17) (internal quotations omitted) (alternations in original).
In construing the second factor, the Court stated that "because the town has demonstrated a strong showing of success on appeal, it need not make as strong a showing of irreparable harm." Id. Thus, the Court concluded that the town "adequately demonstrated" that it would suffer irreparable harm without the stay because it was "doubtful at best" that the town would be able to recover certain funds that were affected by the injunction. Id. at 482-83.
In the third factor analysis, the Court decided that the non-moving party would not suffer substantial harm because the town demonstrated that granting the stay would "essentially [maintain] . . . the status quo between the parties." Id. at 483. Finally, the Court concluded that granting the stay would not harm the public despite the fact that the trial court had found that the town enacted an ordinance that violated the town charter because questions surrounding the trial court's finding were on appeal. Id.
Here, as for their likelihood of success on appeal, the RFP Defendants' argues that the process surrounding the sale involving the West Greenwich Order was defective. The Receiver did not engage in "substantial" marketing efforts; rather, the Receiver chose the Buyer prior to the filing of the initial Motion to Sell the property in November, and "never wavered . . . his focus" from that Buyer. (RFP Defs.' Mot. to Stay at 5.) To support this, the RFP Defendants point to the record and argue that the Receiver failed to adequately describe the property in his initial Motion to Sell in November, and when he filed the amended April Motion, that Motion also had "slightly different terms" looking to sell the "very same presumptive 2-acre parcel of land." Id. at 4. Thus, the RFP Defendants conclude that, if the property was not properly described, there is no way that the proposed sale was subject to competing bids because an entity would not bid on a non-definitive parcel of land. Id. at 5.
As the Receiver points out, the RFP Defendants have demonstrated that they would be successful on appeal. Specifically, the Receiver argues, they have not pointed to any case law or authority that shows that this Court did something incorrectly that would cause a reversal of the West Greenwich Order. (Receiver's Obj. to RFP Defs.' Mot. to Stay at 7-8.)
When reviewing a motion to sell, the Court will consider the "sale price, appreciated value, amount of advertising, and the nature of the assets." Tobias M. Lederberg, Esq., An Overview of Rhode Island Receiverships: Theory and Practice, R.I.B.J. at 9-11 (Feb. 1997). In the July 27 Decision, this Court stated that it considered "the sale price, advertisement, nature of the Property, the P&S Agreement, and the Receiver's supplemental materials," and concluded that the sale was commercially reasonable. July 27 Decision, 2020 WL 4456543, at *4. The RFP Defendants do not point to anything in particular that demonstrates a "strong showing" that the Court erred in such a way that would cause the Order to be reversed. The facts in the case at bar are distinguishable from those presented in International Association of Firefighters. The Supreme Court concluded that there was a "strong showing" that the town would be successful on appeal. International Association of Firefighters, 65 A.3d at 482.
This Court must still "balance" the additional three factors, while keeping in mind the standard of "whether the harm caused [movant] without the [stay], in light of the [movant's] likelihood of eventual success on the merits, outweighs the harm the [stay] will cause [the non-moving party]." Acevedo-García, 296 F.3d at 17. Unlike International Association of Firefighters, the RFP Defendants have not demonstrated a "strong showing" that they are likely to succeed on appeal. Thus, in order to be successful on their Motion to Stay, the RFP Defendants are required to demonstrate that they would have "strong" showings of the other factors to balance all factors in their favor. C.f. International Association of Firefighters, 65 A.3d at 482 ("[B]ecause the town has demonstrated a strong showing of success on appeal, it need not make as strong a showing of irreparable harm.").
There is no indication that the RFP Defendants will suffer irreparable harm if the stay is denied. The RFP Defendants state that, if the subject real estate is sold, their appeal would be mooted. See Cortellesso v. Zanni, 694 A.2d 751, 752 (R.I. 1997) (appeal mooted upon sale of property at center of dispute). They further argue that the harm that will come from the mooted appeal will be the "RFP Defendants' ability to control the disposition of what it asserts is and remains RFP collateral." (RFP Defs.' Mot. to Stay at 6.) The posture of this case dictates a different result because this Court ruled that the RFP Defendants violated G.L. 1956 §§ 6-26-2(a) and 6-26-2(e) (the Usury Statute). Commerce Park Realty, LLC v. HR2-A Corp., PB-2011-1922, 2019 WL 2579853, at *38 (R.I. Super. June 19, 2019) [the June 2019 Decision]. Pursuant to § 6-26-4(a), "[e]very contract made in violation of any of the provisions of § 6-26-2, and every mortgage, pledge, deposit, or assignment made or given as security for the performance of the contract, shall be usurious and void." Thus, the RFP Defendants possess no collateral.
Further, even weighing the other two factors in favor of the RFP Defendants, the "sine qua non" of their Motion to Stay-the RFP Defendants' likelihood of success on appeal-is still missing. Thus, it does not appear that the harm caused to the RFP Defendants, "in light of the [the RFP Defendants'] likelihood of eventual success on the merits," outweighs the harm the stay will cause to the Receiver. See International Association of Firefighters, 65 A.3d at 482. Rather, it is unclear whether the Receiver would be able to find a new buyer quickly or lose their current buyer. Therefore, this Court denies the RFP Defendants' Motion to Stay Pending Appeal.
C. Cambio's Cross-Motion to Stay Pending Cross-Appeal
The Court will next address Cambio's Motion to Stay Pending Appeal of the West Greenwich Order. Cambio indicated in his Motion to Stay that he was incorporating the "Standard" and "Argument" Sections of the RFP Defendants' Motion to Stay.
Cambio does not provide much additional information or argument in this Motion to Stay. The Court finds a void with respect to the proof of the factors. His focus throughout the Motion to Stay targeted the 29 Units Order. Cambio does however argue a "lack of justification to sell off assets in a custodial receivership concerns not only the 29 units, but also the 'crown jewel' of the acreage in West Greenwich, as reflected in the attached Memorandum submitted by the RFP Defendants." (Cambio's Cross-Mot. to Stay at 6.)
Cambio has maintained that this receivership proceeding is a "custodial receivership" rather than a "liquidating receivership." Cambio's reasoning is based on his conclusion that this receivership's purpose is to "hold and preserve property in dispute." Id. at 3. This position is neither grounded in reality nor the case law. As the Supreme Court in Levine v. Bess Eaton Donut Flour Co., 705 A.2d 980, 983 (R.I. 1998) stated,
"the appointment of a nonliquidating receiver in such situations is not only appropriate but can also constitute a welcome lifeline to shareholders and other affected parties when no other relief appears to be adequate, when it is likely to benefit most if not all interested parties by allowing the corporation to continue to operate, or when it will help to protect the interests of the shareholders by preserving company assets from being dissipated if they are in imminent danger of further loss or waste." Levine, 705 A.2d at 983.
Cambio has failed to point out that the "such situations" the Court was referring to were "extraordinary situations," where there is an existence of allegations such as fraud or gross misconduct. Id. ("The appointment of a nonliquidating receiver for an ongoing, solvent corporation is an extraordinary remedy that should be reserved for extraordinary situations."). Cambio has not alleged fraud or gross misconduct. Further, this multi-year litigation includes volumes of filings, of which none have concluded that the current proceeding is a "custodial receivership." (Receiver's Obj. to Cambio's Cross-Mot. to Stay at 7.) In fact, "two permanent receivership appointment orders unequivocally" grant the Receiver the right to sell property of the receivership entities. Id. Moreover, "the numerous court filings, hearings, and orders" expressly authorize "the Receiver to sell property of the receivership entities," all of which are indications of a liquidating receivership. Id.
Thus, Cambio has not demonstrated a "strong showing" that he is likely to be successful on appeal of the West Greenwich Order. See International Association of Firefighters, 65 A.3d at 482 (where the town demonstrated a "strong showing" that it would be successful on appeal because the trial court's actions were in clear contravention of case law and rules). Further, Cambio fails to provide any argument as to the other three factors. Focusing the inquiry on "whether the harm caused [to Cambio] without the [stay], in light of [Cambio's] likelihood of eventual success on the merits, outweighs the harm the [stay] will cause [Receiver]," this Court denies Cambio's Motion. See Acevedo-García, 296 F.3d at 17.
Cambio argues that the irreparable harm occurs because the parties would not "have a full and fair opportunity to be heard on their pending appeals[.]" (Cambio's Cross-Mot. to Stay at 7.) Cambio further states that the interested parties will not be harmed because they have "already waited nearly eight years without having received any payment." Id. at 3. Cambio lacks the sine qua non likelihood of success on appeal. Thus, without a strong showing of the other three factors, this Court denies Cambio's Cross-Motion to Stay Pending Cross-Appeal. See International Association of Firefighters, 65 A.3d at 482; see also Acevedo-García, 296 F.3d at 16-17.
IV Conclusion
Therefore, for the reasons stated above, this Court grants the Receiver's Motion to Dismiss Cambio's Appeal and denies both the RFP Defendants' Motion to Stay Pending Appeal and Cambio's Cross-Motion to Stay Pending Cross-Appeal. Counsel shall submit an order consistent with this Decision.