Opinion
10-P-407
08-03-2011
JOHN MCGEOGHEAN & another v. TIMOTHY MCGEOGHEAN & others.
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
We address each of the defendants' arguments in this complicated case in turn.
The trial judge found that John McGeoghean was entitled to quantum meruit damages in compensation for his actions in reliance on the promise of his mother, the decedent, Sarah McGeoghean, to give him the property at 144 Smith Place and her stake in McGeoghean Construction, Inc. We disagree that the judge impermissibly remade the dispositions in the will in making this finding. As the defendants point out, a promise to include a bequest in a will is not enforceable under the Statute of Frauds. G. L. c. 259, § 5A. The judge appears to have concluded that Sarah's promise was not specific about whether it would be an inter vivos gift or a bequest. Nonetheless, even if we treat the promise as one to include a bequest, quantum meruit is an available remedy in these circumstances, and therefore does not amount to a remaking of the disposition of the property in Sarah's will if the court properly found that John rendered valuable services in reasonable reliance on Sarah's oral promise. See Slawsby v. Slawsby, 33 Mass. App. Ct. 465, 466-467 (1992).
The judge below stated that he could have ordered specific performance and transferred the land directly to John, presumably under a theory of promissory estoppel, relying upon case law involving the inter vivos conveyance of real property. See Hickey v. Green, 14 Mass. App. Ct. 671, 672- 677 (1982). Because the judge ultimately awarded quantum meruit damages, we need not address the question whether a court may order specific performance of a promise to make a bequest of land.
The defendants argue that there was clear error in the judge's factual finding that Sarah promised to give John the Smith Place property and her sixty-percent interest in McGeoghean Construction, Inc. This argument is without merit. In addition to John's testimony, there is testimony of Sarah's brother, Hugh Devlin, that she had told him that John 'had' the Smith Place property. Although Devlin understood this to mean that John already owned the Smith Place property, it nonetheless supports John's assertion that Sarah had promised the property to John. The finding that it was so promised is thus not against the weight of the evidence. Since it is not clearly erroneous, we are without power to overturn it. See Starr v. Fordham, 420 Mass. 178, 182 (1995).
The defendants next argue that John is estopped from arguing promissory estoppel because of the 'Vaughan' affidavit filed by Sarah in John's divorce action. See Vaughan vs. Vaughan, Supreme Judicial Court, No. 91-485 (Nov. 25, 1991). The affidavit stated:
'I, Sarah P. McGeoghean, an individual residing at 20 Saville Street, Cambridge, Massachusetts declare under oath the following:Given the judge's finding that Sarah's promise was not necessarily one to bequeath the property to John, something not contradictory to the statement in Sarah's affidavit, there was no error in failure to find John judicially estopped. Even were we to read the judge's opinion, however, to find that John was promised a bequest, there would be no error in the judge's decision not to apply the doctrine of judicial estoppel. The application of that doctrine is committed to the sound discretion of the trial judge. See A.H. v. M.P., 447 Mass. 828, 845-46 (2006). Here, where the statements in the affidavit appear to be true, we would see no abuse of discretion in the trial judge's determination not to apply judicial estoppel.
'1. My total current net worth is $1.5 million.
'2. On January 25, 2001, I executed estate planning instruments for the benefit of my five (5) children, John, Kevin, Terrence, Timothy, and Maureen Fahey. These instruments included a pour over will and two inter-vivos revocable trusts (individually a 'Trust'). Under the terms of my will, cash bequests will be made to each of my sons, John and Kevin. The cash bequest to my son John will be outright. The bequest to my son Kevin will be made to a Trust, which will provide income and principal to him during his lifetime. Upon his death, the remaining balance of the Trust will be payable to his children. After the payment of any debts, administration expenses, and taxes, the balance of my property disposed under my will shall be made to a Trust for the benefit of my children Terrence, Timothy, and Maureen. At the time of my death, if any of them shall not be living his or her share will be payable to their issue.
'3. The estate planning instruments referred to above have not been amended since their creation on January 25, 2001.'
Judicial estoppel was raised in a February, 2005, motion for summary judgment, and we therefore treat this claim of error as preserved. The defendants also raise an unclean hands argument on the basis of the Vaughan affidavit. Even if this argument was raised below, it would fail for the same reasons as the judicial estoppel argument. See Fales v. Glass, 9 Mass. App. Ct. 570, 575 (1980)(stating that the decision to deny relief based on unclean hands is 'committed to the broad discretion of the [trial] judge').
The defendants argue further that the payments made by John as rent were made to his detriment, and therefore are recoverable, only to the extent that they were above fair rental value. Even putting aside the fact that the defendants failed to establish fair rental value at trial, the full value of these payments represented a detriment to John. The judge found that John was promised that if he made these payments he would be given the property and Sarah's interest in the business. In reliance on that promise, the court found that he made these payments. Furthermore, it is clear that what he was promised included the value of these payments, which ultimately purchased the very equity he was promised in the property. Where the quantum meruit damages were calculated by determining the amount necessary to avoid an injustice, they thus necessarily include the full value of the payments made by John.
The defendants next contend that John did not have standing to contest the ownership of Smith Place. In March, 2004, Sarah transferred her interest in Smith Place to the 144 Smith Place Real Estate Trust of which Timothy McGeoghean was the sole trustee. This transfer, if allowed to stand, would have taken the Smith Place property out of the estate from which John could otherwise have received quantum meruit damages or specific performance. Because of this, John had an interest in determining the ownership of the property and therefore had standing to challenge the transfer.
Moreover, the defendants' challenge to the judge's finding of undue influence with regards to the transfer of Smith Place to the trust is without merit. Undue influence requires 'that an (1) unnatural disposition has been made (2) by a person susceptible to undue influence to the advantage of someone (3) with an opportunity to exercise undue influence and (4) who in fact has used that opportunity to procure the contested disposition through improper means.' Tetrault v. Mahoney, Hawkes & Goldings, 425 Mass. 456, 464 (1997), quoting from Heinrich v. Silvernail, 23 Mass. App. Ct. 218, 223 (1986). The judge below found that Sarah was close to incapacitated and near death at the time of the transfer to the trust and that the transfer was unnatural because it was contrary to her promises to convey the property to John. His findings of fact were not clearly erroneous, and his conclusions of law were supported by those findings. Moreover, this transfer was to Timothy and Maureen's advantage because Timothy gained control of the property and, as stated above, the property was no longer available to satisfy John's claims against the estate, but instead was distributed evenly to the heirs.
Both the judgment voiding the transfer of the Smith Place property to the 144 Smith Place Real Estate Trust and the dismissal of the summary process action by 144 Smith Place LLC, to which Timothy subsequently transferred the property, follow from the judge's finding of undue influence.
The defendants are also incorrect that the calculation of damages was in error. If Sarah's estate could retain the benefit derived from John's payments after Sarah's death in terms of equity and payment of the other carrying costs of the property, the estate would be unjustly enriched. Moreover, the value of the property promised can be considered in determining the value of the services rendered. See Northrop v. Brigham, 63 Mass. App. Ct. 362, 367-369 (2005). In these circumstances, it was not error to find that John is entitled to the full value of all payments made toward the carrying costs of the property. The defendants also argue that the trial judge should not have included the $133,000 in salary payments to Sarah over fourteen years as part of the quantum meruit damages. We cannot say that the judge's finding that these payments were made in reliance on Sarah's promise was clearly erroneous.
As to the defendants' diversion of corporate opportunity claim, we understand the judge's statement that the claim had to be 'dismissed' because it was unproven to mean he was entering judgment after trial, not dismissing the case on the pleadings. Given the evidence in the record, particularly John's testimony that he consulted his mother about his business plans, the defendants cannot demonstrate that they were entitled as matter of law to judgment on this claim.
Finally, with respect to John and Kevin McGeoghean's cross appeal we see no error in allowing the August, 2004, will. The judge made detailed findings of fact distinguishing the circumstances of the signing of that will from the circumstances of the transfer of the Smith Place property, which, again, the court held was due to undue influence. There is no inconsistency in these conclusions, and each is supported by the evidence.
In sum, the judge made detailed findings of fact and conclusions of law and did a good and thorough job of resolving this complicated case. The amended judgment dated December 11, 2009, is affirmed in all respects.
So ordered.
By the Court (Kafker, Vuono & Rubin, JJ.),