Opinion
19-P-1026
06-01-2020
ORANMORE ENTERPRISES, LLC v. MOAWED PROPERTIES, LLC.
NOTICE: Summary decisions issued by the Appeals Court pursuant to its rule 1:28, as amended by 73 Mass. App. Ct. 1001 (2009), are primarily directed to the parties and, therefore, may not fully address the facts of the case or the panel's decisional rationale. Moreover, such 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. See Chace v. Curran, 71 Mass. App. Ct. 258, 260 n.4 (2008).
MEMORANDUM AND ORDER PURSUANT TO RULE 1:28
The plaintiff filed a complaint in the Land Court seeking specific performance of a purchase and sale agreement and approval of a memorandum of lis pendens. A judge allowed the defendant's special motion to dismiss under G. L. c. 184, § 15 (c), finding the complaint to be frivolous, and the plaintiff appeals. We affirm.
"A memorandum of lis pendens is a notice on the record title of real estate that reflects the pendency of any action that 'affects the title to real property or the use and occupation thereof.'" McMann v. McGowan, 71 Mass. App. Ct. 513, 519 (2008), quoting Wolfe v. Gormally, 440 Mass. 699, 700 (2004).
Background. The relevant facts are undisputed. On January 10, 2017, the parties entered into a purchase and sale agreement for property that the defendant owns in South Boston. The agreed purchase price was $15,000,000, but the plaintiff's deposit was only $300,000. As the judge observed, "[i]n effect, this gave [the plaintiff] an option on the property -- taking it completely off the market during an extremely active time for the sale of such properties -- for relatively short money."
The plaintiff planned to build a multi-story complex on the property but first needed zoning variances from the Boston zoning board of appeals (ZBA). The purchase and sale agreement set the closing date accordingly. Specifically, paragraph 8 of the purchase and sale agreement provides:
"[The] deed is to be delivered at 10:00 A.M. on or before the earlier of (a) the fifth business day following the date of expiration of the 20 day appeal period for persons objecting to zoning approvals granted for [b]uyer's development project (such development project as presented to the [ZBA] being referred to herein as the '[p]roject') by the ZBA, or (b) July 1, 2018 (the '[o]utside [c]losing date'). Notwithstanding the foregoing, if the [p]roject has not been rejected by a vote of the ZBA and [b]uyer is still actively pursuing approval of the [p]roject then [b]uyer may extend the [o]utside [c]losing [d]ate to December 31, 2018 by giving [s]eller written notice of such extension. Buyer shall give [s]eller at least five days prior written notice of the actual closing date . . . and place (being the office of [b]uyer's attorney or lender's attorney). There shall be no further extensions except by an agreement signed and delivered by both parties."Paragraph 8 further provides that "[i]t is agreed that time is of the essence of this agreement."
The ZBA gave the plaintiff zoning approval on November 28, 2017, and issued a written decision on May 11, 2018. No person appealed within the twenty-day appeal period, which expired on May 31, 2018. The fifth business day after expiration of the appeal period was June 8, 2018, but the plaintiff failed to come forward with the remainder of the purchase price by that date. Instead, on May 30, 2018, the plaintiff sent the defendant a letter stating that it was "invoking its right to extend the '[o]utside [c]losing date' to December 31, 2018." By return letter the defendant objected to the extension on the basis that the purchase and sale agreement required the closing to occur on June 8.
All relevant communications, on both sides, were sent through counsel.
On June 7, 2018, the defendant e-mailed the plaintiff, attaching the deed and stating that the defendant "expects per the [purchase and sale agreement] to close . . . at 10 A.M. tomorrow, and is ready, willing and able to do so." The plaintiff refused to close, however, reiterating that it had exercised its right to extend until December 31. The defendant then offered to extend for one week to June 15, "without either party in any manner waiving or releasing any positions as to the proper interpretation of the [purchase and sale agreement] and its closing date." The plaintiff did not agree, and no closing occurred on June 15.
On June 27, 2018, the defendant sent notice to the plaintiff that it was terminating the purchase and sale agreement given the plaintiff's failure to close by June 8. The plaintiff filed this suit in response, seeking endorsement of a memorandum of lis pendens and claiming that the purchase and sale agreement gave it the right to extend the closing to December 31, 2018. On the defendant's motion, the judge dismissed the complaint pursuant to G. L. c. 184, § 15 (c), concluding that the claims lacked any reasonable factual support or any arguable basis in law. The judge also awarded the defendant $36,922.50 in attorney's fees pursuant to the same statute.
Discussion. General Laws c. 184, § 15 (c), provides that "[a] party may . . . file a special motion to dismiss . . . if that party believes that the action or claim supporting the memorandum of lis pendens is frivolous." Such a motion "shall be granted if the court finds that the action or claim is frivolous because (1) it is devoid of any reasonable factual support; or (2) it is devoid of any arguable basis in law; or (3) the action or claim is subject to dismissal based on a valid legal defense such as the statute of frauds." Id. We review the allowance of a special motion to dismiss for error of law or abuse of discretion. See Galipault v. Wash Rock Invs., LLC, 65 Mass. App. Ct. 73, 82 (2005).
The judge correctly rejected the plaintiff's interpretation of the purchase and sale agreement as contrary to the agreement's plain language. Paragraph 8 is unambiguous: it provides that the closing had to occur "on or before the earlier of" the date triggered by ZBA approval or "July 1, 2018 ('the [o]utside [c]losing date')." It is undisputed that the date triggered by ZBA approval was June 8, 2018. Thus, under the plain language of paragraph 8, June 8, 2018, was the closing deadline, as it was the "earlier of" the two dates specified.
The plaintiff is not aided by the "[n]otwithstanding" provision of paragraph 8. That provision allowed the plaintiff to "extend the [o]utside [c]losing [d]ate to December 31, 2018 [emphasis added]," if the ZBA had not yet rejected the project and the plaintiff was still pursuing approval. But once the ZBA approved the project, June 8, 2018, became the closing deadline, rendering the outside closing date, and any purported extension thereof, inconsequential. The plaintiff's suggestion otherwise is contrary to the unambiguous language of the "[n]otwithstanding" provision and renders the ZBA-based deadline meaningless. See Lexington Ins. Co. v. All Regions Chem. Labs, Inc., 419 Mass. 712, 713 (1995) ("A contract should be construed in such a way that no word or phrase is made meaningless by interpreting another word or phrase . . ."). We agree with the judge that the plaintiff's interpretation is not even arguable and, therefore, is frivolous.
We also see no merit to the plaintiff's argument that the judge erred by failing to consider whether the defendant breached the implied covenant of good faith and fair dealing. The plaintiff argues in particular that the defendant "engaged in a bait and switch" by postponing the June 8 closing to June 15, "only to ignore that subsequent closing date before declaring a default." But even putting aside that the plaintiff raised no such claim in its complaint, the plaintiff has not shown that the defendant "[did] anything that [had] the effect of destroying or injuring the right of the [plaintiff] to the fruits of the contract." T.W. Nickerson, Inc. v. Fleet Nat'l Bank, 456 Mass. 562, 570 (2010), quoting Anthony's Pier Four, Inc. v. HBC Assoc., 411 Mass. 451, 471-472 (1991). When it became apparent that the plaintiff did not intend to close on June 8, the defendant offered to extend to June 15 while expressly reserving its rights "as to the proper interpretation of the [purchase and sale agreement] and its closing date." The plaintiff did not agree, however, holding firm to its position that the agreement authorized an extension to December 31.
Given that the plaintiff did not agree to the defendant's offer, for this reason alone there is no basis for its assertion that the defendant violated the covenant of good faith and fair dealing by failing to do more to effectuate a closing on June 15. See T.W. Nickerson, supra at 573 ("inaction could only amount to a lack of good faith if [the party] had a duty to act"). Furthermore, even if the plaintiff could be understood to have agreed, it took no steps to protect itself by attempting to close on June 15. The plaintiff provides no authority or reasoning to support its insistence before us that the defendant alone was required to take such steps. We note in this regard that the purchase and sale agreement puts the obligation on the plaintiff to give the defendant "at least five days prior written notice of the actual closing date . . . and place."
Finally, the plaintiff challenges the fee award, asserting, with little explanation, that it was excessive. The judge's decision reflects, however, that he carefully assessed the fee application, including the reasonableness of the hourly rates claimed and the appropriateness of individual time entries, and he ultimately awarded less than half the amount requested. We discern no abuse of the judge's discretion. See Fontaine v. Ebtec Corp., 415 Mass. 309, 324 (1993).
We agree with the defendant that this appeal was frivolous. The defendant may therefore file an application for appellate fees and costs, together with supporting materials, within fourteen days of the date of this order. See Fabre v. Walton, 441 Mass. 9, 10-11 (2004). The plaintiff shall have fourteen days to respond.
To the extent we have not specifically addressed any of the plaintiff's arguments, we have considered them and found them to be without merit. See Commonwealth v. Domanski, 332 Mass. 66, 78 (1954).
Judgment affirmed.
By the Court (Rubin, Maldonado & Shin, JJ.),
The panelists are listed in order of seniority.
/s/
Clerk Entered: June 1, 2020.