Opinion
17-P-1506
09-26-2019
Kent W. PECOY v. Glenn R. HANSON & another (and a consolidated case ).
MEMORANDUM AND ORDER PURSUANT TO RULE 1:28
This action arises from a failed partnership created to purchase and renovate distressed properties. The property at the center of the parties' dispute is a large residential complex located in Hoover, Alabama, known as Riverchase Landing (property). The primary claims and counterclaims, which alleged breach of contract, breach of the covenant of good faith and fair dealing, and tortious interference with a business relationship, were brought in two separate actions by Kent W. Pecoy and UC Riverchase, LLC (UCR), against Glenn R. Hanson and Colony Hills Capital, LLC (Colony Hills). Hanson and Colony Hills also brought a third-party action against UCR. The actions were consolidated for trial in the Superior Court. A jury returned verdicts in favor of Pecoy and UCR and awarded damages on their claims. Thereafter, the trial judge entered judgment in favor of Pecoy and UCR, and awarded them attorney's fees and costs. On appeal, Hanson and Colony Hills contend that the judge erred by (1) denying their motion for a directed verdict on Pecoy's contract claims; (2) denying their motion for a new trial based on the theory that Pecoy's contract damages were not supported by the evidence; (3) admitting in evidence the transcript of a special meeting of investors under the business records exception to the hearsay rule; (4) awarding attorney's fees against Hanson individually; and (5) awarding excessive attorney's fees to UCR.
Another defendant, Krista Hanson, was dismissed from the case on the eve of trial.
Neither Hanson nor Colony Hills appeals from the judgment in favor of UCR. As we discuss later, Hanson claims that UCR does not have a judgment against him.
Background. We summarize the relevant facts, reserving certain details for our discussion of the issues. In 2008, Hanson and Pecoy created Colony Hills for the purpose of purchasing and then developing distressed residential properties. In 2011, Hanson and Pecoy, through Colony Hills, acquired the property. The property was in foreclosure and appeared to be a good investment. The financing for the acquisition was provided by Colony Hills Capital Residential Fund One, LLC (CHCRF1), a single-purpose entity formed by Colony Hills to raise investment funds, and by UCR, an entity created by UC Funds, a private investment company. On October 6, 2011, Colony Hills, along with its funding sources, CHCRF1 and UCR, entered into an agreement creating Riverchase Holding, LLC (Riverchase), to take title to the property at closing (LLC agreement). Pursuant to the LLC agreement, Colony Hills was designated as the manager of Riverchase, Pecoy was appointed the manager's representative, and CHCRF1 and UCR were designated as investor members. Under the LLC agreement, Pecoy and Colony Hills were responsible for the operation and maintenance of the property. However, UCR retained certain rights relative to the oversight of the property, including the right to approve or veto any change or appointment of property managers. UCR also had the right to terminate and remove Pecoy and Colony Hills from their positions upon any breach of the LLC agreement. In addition, Hanson and Pecoy personally guaranteed Colony Hills's and CHCRF1's performance under the LLC agreement.
Initially, there were three managing members of Colony Hills, but the third individual is not a party in this case.
The property was later sold in October 2015 at a significant profit.
At the same time as the acquisition of the property was moving forward, increasing acrimony led Pecoy and Hanson to end their partnership in Colony Hills. Eventually, the parties agreed that Pecoy would transfer his ownership interest in Colony Hills to Hanson in exchange for an agreement making Pecoy the property manager in charge of Riverchase for which he would collect a monthly property management fee. This agreement was memorialized in two documents executed together on October 24, 2011: an "assignment of LLC interests" (assignment) and a "services agreement" (collectively, agreement). At trial, Pecoy testified that he believed the agreement was premised on the understanding that he would recoup the value of his transferred interest in Colony Hills after receiving monthly property management fees for five years. In his testimony, Hanson acknowledged that Pecoy would recoup his investment if the property were held for five years, but stated that he did not "guarantee an income stream for those management fees for five years." The extent of the parties' obligations under the agreement was hotly contested at trial.
Over the ensuing two years, the relationship between Pecoy and Hanson further deteriorated -- as did Hanson's relationship with UCR -- resulting in a flurry of lawsuits filed in late 2013 in both Alabama and Massachusetts. These lawsuits asserted a variety of claims, counterclaims, cross claims, and third-party claims involving Pecoy and UCR, acting independently, and Hanson and Colony Hills (and other interested parties). Most of the disputes centered on the management of Riverchase and the obligations of the various parties under the LLC agreement. Each side accused the other of wrongdoing and intentional interference with the management of the property. Ultimately, the lawsuit initiated by Hanson and Colony Hills in Alabama was dismissed, and two other actions, filed separately by Pecoy and UCR against Hanson and Colony Hills in the Superior Court, were consolidated for trial, which took place in May 2016. The consolidated action also included the counterclaims and third-party claims brought by Hanson and Colony Hills against Pecoy and UCR.
The claims ultimately put to the jury were for breach of contract, breach of the implied covenant of good faith and fair dealing, and tortious interference with an advantageous relationship -- each claim brought separately by Pecoy and UCR against Hanson and Colony Hills, and as counterclaims by Hanson and Colony Hills against Pecoy and UCR. The parties submitted a special verdict form and special questions to the jury. The jury returned verdicts in favor of Pecoy and UCR, and against Hanson and Colony Hills, on all three claims and awarded damages. In their responses in the special verdict form, which concerned the claims between Pecoy, Hanson, and Colony Hills, the jury specifically found that Hanson and Colony Hills had "breached the agreement with Kent Pecoy" and had "breached [their] duty of good faith and fair dealing in the agreement with Kent Pecoy." The jury further found that Hanson interfered with Pecoy's advantageous relationship with Colony Hills, Riverchase, "and/or [UCR] by use of improper means and/or motive," and that the conduct of "[Hanson] and/or [Colony Hills] ... in breaching the agreement was either grossly negligent and/or willful misconduct." The jury also found that Pecoy had not breached the agreement or the implied covenant of good faith and fair dealing with respect to the agreement. The "agreement" to which the special verdict form referred is the assignment and the services agreement executed together on October 24, 2011. The jury answered similar questions about the conduct of UCR, Hanson, and Colony Hills with respect to the LLC agreement. The following judgments were entered, all of which included prejudgment interest and costs: for Pecoy against Colony Hills in the amount of $238,854.41; for Pecoy against Hanson in the amount of $323,840.51; and for UCR against Colony Hills in the amount of $102,434.52. Upon petitions for attorney's fees, Pecoy was awarded fees in the amount of $237,605, and UCR in the amount of $441,086.50.
Other claims and interested parties were dismissed at various points during and after the trial.
UCR's special questions form identified the defendants in each question as Colony Hills "and/or" Hanson.
See our discussion of Hanson's claim that UCR does not have a judgment against him, infra.
Discussion. 1. Denial of the motion for directed verdict on Pecoy's contract claims. Hanson argues that he was entitled to a directed verdict because Pecoy failed to prove he (Hanson) was a party to the agreement. Hanson and Colony Hills both argue that the judge erred in denying their motion for a directed verdict because the evidence was insufficient "to prove actionable promises of a five-year term and [a] personal guarantee [of that term] by Colony Hills or Hanson." Both defendants also argue that Pecoy willfully and materially breached the agreement first and, therefore, Pecoy is barred from recovering damages, and that both Hanson and Colony Hills were discharged from their obligations under the agreement.
We review a denial of a motion for directed verdict to determine "whether the evidence, construed against the [moving parties], justifies a verdict against [them]." Vita v. Berman, DeValerio & Pease, LLP, 81 Mass. App. Ct. 748, 754, 967 N.E.2d 1142 (2012), quoting McCarthy v. City of Waltham, 76 Mass. App. Ct. 554, 560, 924 N.E.2d 316 (2010). "Our duty in this regard is to evaluate whether anywhere in the evidence, from whatever source derived, any combination of circumstances could be found from which a reasonable inference could be made in favor of the [nonmovant]" (quotation and citation omitted). O'Brien v. Pearson, 449 Mass. 377, 383, 868 N.E.2d 118 (2007). We have conducted a careful review of the record and agree with the judge that the evidence presented to the jury was sufficient to warrant denial of the defendants' motion for a directed verdict.
a. Hanson's claim that he was not a party to the agreement. Pecoy's breach of contract claims are based on the agreement (assignment and services agreement executed together on October 24, 2011). Pecoy testified that he and Hanson fashioned a "unitary transaction" whereby Pecoy assigned his interest in Colony Hills to Hanson in exchange for collecting a monthly property or asset management fee as the property manager in charge of Riverchase. The attorney who drafted the services agreement and the assignment testified that the documents memorialized "one transaction ... two sides of the [same] coin."
When two contracts are sufficiently interrelated and interlocking that they constitute one transaction, they may be construed together. See Chelsea Indus., Inc. v. Florence, 358 Mass. 50, 55, 260 N.E.2d 732 (1970) (construing as part of one transaction shareholders' agreement to sell stock to corporate buyer and subsequent employment agreement between one shareholder and corporate buyer). See also Chase Commercial Corp. v. Owen, 32 Mass. App. Ct. 248, 250-251, 588 N.E.2d 705 (1992) (agreements that were executed at same time and which are in essence part of one transaction must be read together to effectuate intention of parties).
Hanson claims, as he did at trial, that he signed the services agreement in his capacity as manager of Colony Hills and that he only personally guaranteed one aspect of that agreement regarding the accuracy of Colony Hills's liabilities as of the date the agreement was signed. However, Pecoy's version of the events, including his understanding of the transaction, and the evidence surrounding the execution of the assignment and the services agreement provided factual support for a reasonable inference that Hanson and Pecoy intended to complete a unitary transaction and that Hanson was a party to the agreement.
b. The existence of a five-year term. The defendants argue that Pecoy failed to provide sufficient evidence that there was an enforceable promise of a five-year term implicit in the agreement. But the defendants never challenged the sufficiency of such evidence in their motion for a directed verdict. As a result, the defendants have waived this claim. See Carey v. New England Organ Bank, 446 Mass. 270, 285, 843 N.E.2d 1070 (2006).
The defendants' argument that the five-year term amounts to an invalid oral amendment to the agreement, which is barred by the parole evidence rule and the Statute of Frauds, also is waived based on the defendants' failure to object to testimony regarding the five-year term and their failure to raise this ground in their motion for a directed verdict.
c. The alleged breaches of contract. Pecoy accused Hanson and Colony Hills of breaching the agreement through specific acts that he claims restricted and interfered in his duties as the manager's representative of Riverchase. The primary allegation centered on Hanson's clandestine efforts to replace the on-site property manager at the property. Hanson and Colony Hills argue, however, that Pecoy breached the agreement first and that he admitted doing so at trial when he acknowledged that he paid himself a construction management fee (which the agreement prohibited) and refused to provide information requested by Colony Hills regarding the management of Riverchase (which the agreement required Pecoy to do). Hanson and Colony Hills further argue that these alleged admissions constitute undisputed evidence of a material breach and, therefore, the judge erred in permitting the jury to consider the issue. See EventMonitor, Inc. v. Leness, 473 Mass. 540, 546, 44 N.E.3d 848 (2016) (whether party has committed material breach is ordinarily question of fact, but if evidence is undisputed, it is question of law).
There was substantial evidence presented to the jury in support of Pecoy's claim. That evidence showed that Hanson misappropriated investment funds during and after the purchase of the property, interfered with the operation of Greystar, the on-site property management company, sought to replace Greystar without securing the requisite permission from UCR, attempted to replace Pecoy as the manager's representative of Riverchase, and broke into the offices of the property in the middle of the night to take physical possession of it. Pecoy claimed these acts were orchestrated to take over the management of the property and led to UCR's exercising its right under the LLC agreement to take control of the property, which, in turn resulted in Pecoy's termination as the manager of Riverchase and the cessation of his management fees.
Here, however, the question whether Pecoy was the first party to breach the agreement was disputed. At trial, Pecoy provided alternative explanations for the specific conduct on which Hanson and Colony Hills rely as evidence of a breach. For example, Pecoy claimed that the taking of a construction management fee was either allowed or not governed by the agreement. With regard to the claim that he failed to provide information to Colony Hills, he claimed that he did so and was not contractually obligated to do more than he did. Given these factual disputes, the question whether Pecoy had breached the agreement first and, if so, whether that breach was material was properly submitted to the jury. Accordingly, the judge did not err in denying the defendants' motion for a directed verdict on this ground.
2. Denial of the defendants' motion for a new trial. Hanson and Colony Hills maintain that their motion for a new trial, in which they challenged the jury's award of damages to Pecoy, was erroneously denied. They contend that the award was excessive and not supported by the evidence. The motion was denied in a margin endorsement.
We review the denial of a motion for a new trial for abuse of discretion. "Unless the damages awarded were greatly disproportionate to the injury proven or represented a miscarriage of justice, an appellate court will not find an abuse of discretion in the judge's refusal to grant a new trial." doCanto v. Ametek, Inc., 367 Mass. 776, 787, 328 N.E.2d 873 (1975). We discern no abuse of discretion.
The jury awarded Pecoy contract damages of $241,600 against Hanson, and $178,400 against Colony Hills, for a total award of $420,000. While we cannot discern with certainty how the jury determined this award, it is consistent with Pecoy's testimony that the total value of his original investment in Colony Hills was $550,000, and that he received property management fees in the amount of $130,000. The jury reasonably could have subtracted the $130,000 earned in fees from the amount of Pecoy's original investment to arrive at $420,000, the exact amount of the award.
The defendants advance a new theory on appeal. They claim that because Pecoy agreed to the sale of the property three years after he entered into the agreement, the damages award should be reduced by approximately $192,000. This argument was not raised in the defendants' motion for a new trial. Thus, we deem this argument waived. See Reckis v. Johnson & Johnson, 471 Mass. 272, 300, 28 N.E.3d 445 (2015).
Thus, the damages award is not "greatly disproportionate to the injury proven" or "a miscarriage of justice." doCanto, 367 Mass. at 787, 328 N.E.2d 873. Moreover, because the judge "saw the witnesses and heard them testify, he was ‘in a far better position than we are to determine the reasonableness of the jury award.’ " Thayer v. Pittsburgh-Corning Corp., 45 Mass. App. Ct. 435, 443, 703 N.E.2d 221 (1998), quoting doCanto, supra at 788, 328 N.E.2d 873. We do not substitute our judgment for that of the judge in these circumstances.
3. The admissibility of the transcript of the special meeting. Hanson and Colony Hills contend that the jury's verdict should be reversed because the judge erroneously admitted in evidence a transcript of a special meeting of the investors of CHCRF1 under the business records exception to the rule against hearsay. The meeting was called by Pecoy for the purpose of bringing "the investors up to speed with what was going on, and to take a special vote to determine who was going to control [CHCRF1]." The meeting was held on December 13, 2013, and lasted approximately three hours. Both Hanson and Pecoy spoke and answered questions from the investors. At the conclusion of the meeting, the investors elected Pecoy and another individual to manage CHCRF1. Hanson was not reelected. A transcript, prepared by a registered court reporter, was admitted over Hanson's and Colony Hills's objection, as a business record of CHCRF1.
Counsel for UCR also argued that because the transcript contains statements of opposing parties, it was admissible. See Mass. G. Evid. § 801(d)(2) (2018). However, the judge did not admit the transcript on this ground. In any event, while the transcript does contain some statements by Hanson (the party opponent), much of the transcript consisted of hearsay.
"Under the business records exception to the hearsay rule, a document is admissible as a business record if the judge finds that it was (1) made in good faith; (2) made in the regular course of business; (3) made before the action began; and (4) the regular course of business to make the record at or about the time of the transaction or occurrences recorded." Beal Bank, SSB v. Eurich, 444 Mass. 813, 815, 831 N.E.2d 909 (2005).
Hanson argues that several of the conditions necessary to make the transcript admissible as a business record were not met. In particular, he points to the fact that the transcript was not created before the action began. Rather, it was created three months after the action commenced. Hanson further argues that he was prejudiced because the transcript portrayed him in a bad light, and counsel for Pecoy impermissibly capitalized on this fact when he suggested to the jury that they take the same course of action against Hanson as the investors took. We agree with the defendants that the transcript was not admissible as a business record, if only because it was created after the law suit was filed. We also agree that counsel's remark was ill advised. Nevertheless, a new trial is not required.
Hanson does not object to the admission of the transcript on the grounds of its accuracy or reliability.
At the outset, we note that the statements contained in the transcript were equally disparaging of both Hanson and Pecoy, and were the subject of cross-examination. In addition, the statements were substantially corroborative of the parties' testimony at trial. In fact, Pecoy's testimony about the meeting was sufficiently repetitive of the transcript that Hanson's attorney objected, stating at sidebar that "[t]he jury has the transcript, so it's just in evidence questions about what was said or not said ... it's just walking us down into the matters that aren't in dispute anymore." Moreover, although we agree that the transcript reflects a lack of confidence among the investors toward Hanson, we note that Hanson testified at length during the trial, allowing substantial opportunity for the jury to reach their own conclusions about his credibility. In particular we note that Hanson was extensively cross-examined about the meeting without objection. Nor was there an objection to the remarks made by Pecoy's counsel in his closing. Thus, although the transcript of the special meeting was not admissible under the business records exception, "[w]e are satisfied ‘with substantial confidence that the error would not have made a material difference.’ " Mason v. Coleman, 447 Mass. 177, 188, 850 N.E.2d 513 (2006), quoting DeJesus v. Yogel, 404 Mass. 44, 49, 533 N.E.2d 1318 (1989).
Relying on Gishen v. Dura Corp., 362 Mass. 177, 182, 285 N.E.2d 117 (1972), Pecoy and UCR claim that this statement reflects a concession by Hanson's attorney that the transcript is admissible. Our reading of the record does not support this argument.
4. The awards of attorney's fees. Following the return of the jury's verdict, both Pecoy and UCR filed motions seeking attorney's fees against Hanson and Colony Hills. Pecoy's request was based on the indemnification provision of the services agreement, which provided for the recovery of attorney's fees if the underlying claim resulted from gross negligence or willful misconduct. UCR's request rested on a provision of the LLC agreement, which permitted an award of attorney's fees to the prevailing party in any litigation arising from the LLC agreement. The motions were allowed with some modifications without a hearing in a handwritten margin endorsement. We review an award of attorney's fees for abuse of discretion; the judge's decision will be reversed only if it is clearly erroneous. Beninati v. Borghi, 90 Mass. App. Ct. 556, 567-568, 61 N.E.3d 476 (2016).
The relevant provision of the services agreement provided:
"Each party, at its expense, shall defend, indemnify and hold harmless the other party, including in the case of the Company, its managers, members, officers and employees, from all suits, claims, damages, losses and expenses, including reasonable attorneys' fees, in whole or in part arising out of or resulting from its gross negligence or willful misconduct and that of any one engaged by it in the performance of this Agreement. Such obligation shall not be construed to negate or abridge any other obligation of indemnification which would otherwise exist. A party shall give the other prompt notice of any claim, threatened or made, or suit instituted against it, which could result in a claim for indemnification hereunder, provided, however, that lack of such notice shall not be a waiver of the right to indemnification under this Agreement, unless the party from which indemnification is sought can demonstrate that it was materially prejudiced by such lack of notice."
The LLC agreement provided in relevant part:
"To the fullest extent permitted by law, in the event of any litigation, arbitration, or other dispute arising as a result of or by reason of this Agreement, the prevailing party in any such litigation, arbitration or other dispute shall be entitled to, in addition to any other damages permitted pursuant to this Agreement and assessed in such action, its reasonable attorneys' fees, and all other costs and expenses incurred in connection with settling or resolving such dispute."
a. Pecoy. We turn first to the award of attorney's fees to Pecoy. Hanson claims that he is not liable for the payment of Pecoy's attorney's fees because the indemnification clause on which Pecoy relies is not a fee-shifting provision. He further asserts that even if the indemnification provision can be construed as a fee-shifting provision, it does not bind him because he is not a party to the agreement. We need only address the first argument.
We note that Colony Hills does not make this argument. In fact, Colony Hills has not advanced any argument opposing the award of attorney's fees to Pecoy.
"The American rule dictates that in the absence of a fee-shifting statute or court rule, a successful party is not allowed to recover its attorney's fees and expenses." Hermanson v. Szafarowicz, 457 Mass. 39, 51, 927 N.E.2d 982 (2010). "There is no statute or court rule that would provide for the awarding of attorney's fees in this case. The parties, however, may construct their agreement to provide for the payment of attorney's fees through clear and unambiguous language." K.G.M. Custom Homes, Inc. v. Prosky, 468 Mass. 247, 258, 10 N.E.3d 117 (2014). We conclude that the indemnification clause does not clearly and unambiguously contemplate the awarding of fees incurred as a result of litigation arising from a breach of contract committed by one party to the agreement. Among other things, the provision is entitled "Indemnification" and includes the phrase "defend, indemnify and hold harmless," language that is customary in third-party indemnification provisions rather than in fee-shifting provisions between parties. Therefore, Hanson is not liable for the payment of attorney's fees to Pecoy and we vacate the award of attorney's fees as to him.
b. UCR. Hanson argues that UCR is not entitled to recover attorney's fees from him (1) because UCR does not have a judgment against him, and (2) because he was not a party to the LLC agreement, he is not liable for the payment of attorney's fees. He also asserts that the amount of the award is excessive. Colony Hills joins Hanson's challenge to the amount of the award. We address each argument in turn.
A judgment was entered on the docket in UCR's case on August 17, 2016. The judgment identified the plaintiff as UCR and the defendant as Colony Hills. Although Hanson was a named defendant in that case, his name did not appear on the judgment. UCR argues that the omission of Hanson's name is merely a clerical error that, presumably, could be corrected under Mass. R. Civ. P. 60 (a), as appearing in 365 Mass. 828 (1974). That may be so, and as UCR argues, it is not unreasonable to conclude that UCR will secure a judgment against Hanson. However, in the absence of an entry on the docket reflecting a judgment against Hanson, we are not in a position to affirm the award of attorney's fees as to him.
Rule 60 (a) provides in relevant part:
"Clerical Mistakes. Clerical mistakes in judgments, orders or other parts of the record and errors therein arising from oversight or omission may be corrected by the court at any time of its own initiative or on the motion of any party and after such notice, if any, as the court orders. During the pendency of an appeal, such mistakes may be so corrected before the appeal is docketed in the appellate court, and thereafter while the appeal is pending may be so corrected with leave of the appellate court."
We note that a judgment against Hanson would be consistent with the prior proceedings in the case. In fact, Hanson (and Colony Hills) filed a motion for a new trial from the judgment entered in favor of UCR.
Hanson's second argument, that UCR cannot recover attorney's fees from him because he was not a party to the LLC agreement, is raised for the first time on appeal. Consequently, this argument is waived. See McLaughlin v. American States Ins. Co., 90 Mass. App. Ct. 22, 33 n.17, 55 N.E.3d 1007 (2016) (argument concerning recovery of attorney's fees that is raised for first time on appeal is waived).
Hanson did not argue that the LLC agreement did not contain a fee-shifting provision in his opposition to UCR's motion for attorney's fees. Thus, to the extent he raises it on appeal, it is waived.
Next, Hanson and Colony Hills challenge the award of fees to UCR as excessive. They argue that the award erroneously included attorney's fees associated with UCR's litigation of claims against Krista Hanson despite the fact that UCR voluntarily dismissed those claims just prior to the beginning of the trial. See note 3, supra. Thus, they claim, Krista Hanson was not a prevailing party, and it was therefore improper for the judge to award UCR any fees it incurred in connection with the case against her. The judge rejected this argument. Although we do not have the benefit of the judge's analysis, we can infer that he either determined UCR was the prevailing party or that the litigation was so interrelated that it would not be possible to subtract expenses incurred with respect to Krista Hanson from the overall expenses of the litigation. The record does not disclose the reasons for the dismissal of the case against Krista Hanson, but as UCR notes in its brief, it prevailed in the third-party action originally brought by Hanson, Colony Hills, and Krista Hanson. In addition, our review of the billing records shows the difficulty of separating legal work provided exclusively with respect to claims against Krista Hanson; and, to the extent there is any, it is minimal. Accordingly, we discern no abuse of discretion with respect to this award.
The defendants also object to fees incurred for use of multiple lawyers in multiple States for discovery, and multiple lawyers from Boston who traveled to Springfield to try the case. With respect to these concerns, we similarly discern no abuse of the judge's broad discretion. The judge "is in the best position to determine how much time was reasonably spent on a case, and the fair value of the attorney's services." Beninati, 90 Mass. App. Ct. at 568, 61 N.E.3d 476, quoting Fontaine v. Ebtec Corp., 415 Mass. 309, 324, 613 N.E.2d 881 (1993). "A fair market rate for time reasonably spent preparing and litigating a case is the basic measure of a reasonable attorney's fee." Fontaine, supra at 326, 613 N.E.2d 881. Here, the judge reviewed the billing records submitted by UCR, including how many attorneys were involved and their hourly rates, and, after reducing UCR's request by about $90,000, awarded UCR $441,086.50.
UCR explains these charges as being necessary because there were witnesses to be deposed and documents to be reviewed in several States, causing UCR to retain local counsel to conduct discovery.
Finally, Hanson and Colony Hills argue that the award was disproportionate to UCR's damages award of $77,000, which, with interest and costs, totaled $102,434.52. However, a fee award that is disproportionate to the damages awarded may be warranted when the amount of time expended is reasonably due to the necessities and complexity of the litigation. See A.C. Vaccaro, Inc. v. Vaccaro, 80 Mass. App. Ct. 635, 643-644, 955 N.E.2d 299 (2011) (attorney's fee award was not "excessive by reason of its disproportionality" to total amount of damages because trial court proceedings "encompassed extensive discovery and motion practice, and a five-day jury trial"). Here, some disproportion between the verdict and the fee award is warranted in light of a ten-day jury trial, where there were multiple actions involving multiple parties, including counterclaims and third-party claims against which UCR had to defend itself.
Conclusion. As to Pecoy, the judgments are affirmed and the award of attorney's fees against Hanson is vacated. As to UCR, the judgment is affirmed, as is the award of attorney's fees against Colony Hills; the award of attorney's fees against Hanson is vacated subject to reinstatement if and when a judgment is entered against Hanson.
Pecoy's request for appellate attorney's fees is denied.
So ordered.
affirmed