266 RIVER STREET REDEVELOPMENT, LLC v. PAUL H. MARTIN, Trustee, & Another.

• Court: Massachusetts Appeals Court
• Decided: December 24, 2024
• Docket: 24-P-0094
• Status: Unpublished

Opinion

NOTICE: Summary decisions issued by the Appeals Court pursuant to M.A.C. Rule 23.0, as appearing in 97 Mass. App. Ct. 1017 (2020) (formerly known as 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 23.0 or 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).

COMMONWEALTH OF MASSACHUSETTS

APPEALS COURT

24-P-94

266 RIVER STREET REDEVELOPMENT, LLC

vs.

PAUL H. MARTIN, trustee,1 & another.2

MEMORANDUM AND ORDER PURSUANT TO RULE 23.0

The plaintiff filed a verified complaint seeking specific

performance of an option to purchase agreement (agreement)

related to a commercial property in Haverhill (property).

Contemporaneously, the plaintiff filed a motion for endorsement

of a memorandum of lis pendens. The defendants opposed the

motion and filed a special motion to dismiss the complaint under

G. L. c. 185, § 15 (c). After a combined hearing on the

motions, a Superior Court judge denied the defendants' special

motion to dismiss and allowed the plaintiff's motion for a

1Of the 266 River Street Realty Trust under declaration of trust dated January 25, 2001 (Realty Trust).

2 Denise J. Martin, as trustee of the Realty Trust. memorandum of lis pendens. The defendants moved for

reconsideration under Superior Court Rule 9D (2023), which the

judge denied. The defendants then filed this interlocutory

appeal, see G. L. c. 184, § 15 (d), arguing that the judge

should have dismissed the action as frivolous and should have

reconsidered his decision based on new evidence. We affirm.

Background. The following facts, taken from the

plaintiff's complaint and the defendants' counterclaim,3 appear

to be undisputed, at least for purposes of this appeal.

The agreement, executed on August 24, 2020, granted the

plaintiff an option to purchase the property from the defendants

for a price of $1,650,000, with a deposit of $200,000 due

immediately and to be placed in escrow. To exercise the option,

the plaintiff was required to send to the defendants "by

certified mail, return receipt requested, on or before December

15, 2022," a written notice containing specified language. The

agreement provided that, upon the defendants' receipt of such

notice, the parties would execute a purchase and sale agreement

3 The defendants did not submit any affidavits or documents in support of their special motion to dismiss, nor did the plaintiff in support of its opposition. Cf. Ferguson v. Maxim, 96 Mass. App. Ct. 385, 390 (2019) ("a special motion to dismiss under § 15 (c) requires the motion judge to consider alleged facts beyond the plaintiff's initial pleading").

2 (P&S) within three business days. The term of the agreement ran

from August 24, 2020, to January 31, 2023.

On October 21, 2021, the parties executed an amendment to

the agreement (amendment). The amendment extended the option to

purchase period by six months, requiring the plaintiff to mail

written notice of its exercise of the option by June 15, 2023.

The amendment provided that "[a]ll other aspects of the

[agreement] will remain intact."

The plaintiff did not provide the defendants with a written

notice exercising the option by June 15, 2023. Nonetheless, as

the June 15, 2023 date approached, the parties exchanged

correspondence suggesting that they expected to close on the

sale.4 On June 2, 2023, the defendants' counsel sent counsel for

the plaintiff's lender a draft deed for the property and stated

that work was continuing on the title issues to prepare "what

4 Meanwhile, during the years following execution of the agreement, the plaintiff took significant steps toward its planned redevelopment of the property, including creating plans, applying for historic tax credits, conducting meetings with local stakeholders, and performing walkthroughs of the property with architects and other contractors. During one of the plaintiff's onsite visits in March 2023, defendant Paul Martin stated he would not be able to remove his furniture from the property by June 15, 2023; the plaintiff then agreed to allow him to occupy two floors of the property through the end of the year in exchange for rent and payment of expenses. According to the complaint, by this time, the parties were referring to June 15, 2023, as the "closing date."

3 needs to be recorded by closing." On June 6 and 8, the

defendants' counsel and lender's counsel exchanged additional

correspondence referring to the title issues that needed to be

resolved before the closing. Then on June 14, the defendants'

counsel emailed the lender's counsel, asking if the closing was

going to occur the next day. The lender's counsel replied that

the plaintiff might need a couple of extra days to finalize

funding, to which the defendants' counsel replied, "Ok, keep me

posted." On June 19 the defendants' counsel followed up with an

email asking, "[W]here we are at [sic] with this closing" and

"Do you know when we might be able to close?" The lender's

counsel replied the same day that the plaintiff was still

waiting on some funding.

On July 14, 2023, with the closing not having occurred, the

defendants' counsel informed the lender's counsel that the

transaction was "out of contract" and demanded that the $200,000

deposit in escrow be released to her clients. The plaintiff

filed this suit in response, claiming breach of contract, breach

of the covenant of good faith and fair dealing, and unjust

enrichment, and seeking specific performance, damages, and

declaratory relief. The defendants counterclaimed for a

4 declaratory judgment, seeking disbursement of the $200,000

deposit.5

Discussion. 1. Special motion to dismiss. General Laws

c. 184, § 15 (c), "contains a mechanism for expedited removal of

an unjustified lis pendens, including dismissal of frivolous

claims supporting an approved lis pendens." Wolfe v. Gormally,

440 Mass. 699, 705 (2004). To prevail on a special motion to

dismiss under this statute, the defendant must show, by a

preponderance of the evidence, "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." G. L. c. 184,

§ 15 (c). See Ferguson v. Maxim, 96 Mass. App. Ct. 385, 390

(2019). On appellate review we examine "the same factors

properly considered by the judge in the trial court in the first

instance." Galipault v. Wash Rock Invs., LLC, 65 Mass. App. Ct.

73, 82 (2005). The judge's "conclusions of law are subject to

broad review," and we may draw our own conclusions from the

documentary evidence in the record. Id.6

5 The defendants brought additional counterclaims, but the parties later stipulated to their dismissal.

6 The parties agree that our overarching standard of review is for abuse of discretion. But neither has addressed the

5 The defendants principally contend that the action is

frivolous because the plaintiff never sent written notice that

it was exercising its option to purchase in the manner required

by the agreement and, as a result, has no enforceable rights

under the agreement. The judge rejected this argument on the

ground that there is a genuine factual dispute whether the

defendants waived the written-notice requirement through their

conduct. Because of this factual dispute, the judge reasoned,

the record as presented does not establish that the plaintiff's

claims are devoid of any factual or legal support. We agree.

Waiver of a contractual provision "may occur by an express

and affirmative act, or may be inferred by a party's conduct."

KACT, Inc. v. Rubin, 62 Mass. App. Ct. 689, 695 (2004). Where

the "waiver is not explicit, it must be premised on 'clear,

decisive and unequivocal conduct.'" Id., quoting Glynn v.

Gloucester, 9 Mass. App. Ct. 454, 462 (1980). This is a

question of fact. See KACT, Inc., supra.

Supreme Judicial Court's recent decision in Bristol Asphalt Co. v. Rochester Bituminous Prods., Inc., 493 Mass. 539, 560 (2024), which held that de novo review applies to rulings on special motions to dismiss under the anti-SLAPP statute, G. L. c. 231, § 59H. The special motion to dismiss mechanism under the anti- SLAPP statute is similar to that under G. L. c. 184, § 15 (c). See Ferguson, 96 Mass. App. Ct. at 390. In any event, whether our review is de novo or for abuse of discretion, we would not disturb the judge's decision to deny the special motion to dismiss.

6 Here, the plaintiff's claim of waiver by conduct is not

devoid of any reasonable factual or legal support. The parties'

correspondence as described above suggests that they were

preparing for a closing on June 15, 2023 -- the amended deadline

for the plaintiff to send written notice that it was exercising

the option -- even though the plaintiff had not by that point

sent any such notice. There is nothing in the record reflecting

that the defendants ever raised an issue regarding notice. To

the contrary, the day before the June 15 option deadline, the

defendants' counsel appeared to acquiesce to lender's counsel's

request to extend the closing date, and, a few days after the

deadline had passed, the defendants' counsel asked when the

closing would occur, raising no assertion that the plaintiff had

failed to effectively exercise the option.

On this record we agree with the judge that there is at

least reasonable factual support for the plaintiff's position on

waiver. The judge was thus correct to deny the special motion

to dismiss. See Ferguson, 96 Mass. App. Ct. at 394-395 (rulings

that "depend[] on the resolution of disputed facts . . . should

not be made in deciding a special motion to dismiss"). See also

McCarthy v. Tobin, 429 Mass. 84, 88-89 (1999) (seller waived

deadline for execution of purchase and sale agreement through

words and conduct, including by failing to object to passage of

7 deadline and by suggesting to buyer that extension of deadline

was acceptable). In so concluding, we express no view on the

merits of the plaintiff's position. Rather, the more limited

question raised by this appeal is whether the defendants have

shown that the plaintiff's position is "devoid of any reasonable

factual support" or "any arguable basis in law." G. L. c. 184,

§ 15 (c). The defendants have not met this high burden. Cf.

Bristol Asphalt Co. v. Rochester Bituminous Prods., Inc., 493

Mass. 539, 560 (2024) (proving in anti-SLAPP context that

"petitioning is 'devoid' of any reasonable factual support or

any arguable basis in law is a difficult task").

The defendants also argue that the action is frivolous

because the deadline to exercise the option was an essential

term of the agreement and so any oral agreement to extend the

deadline is barred by the Statute of Frauds. We are not

persuaded. To begin with, it is not clear to us that the

plaintiff is even claiming that the parties had an oral

agreement to extend the deadline. The only mention in the

complaint of an oral agreement relates to extending the closing

date, not the deadline for exercising the option. Furthermore,

to the extent the plaintiff is raising such a claim, whether the

option deadline was essential to the agreement is a question of

fact, see Situation Mgmt. Sys. v. Malouf, Inc., 430 Mass. 875,

8 879 (2000), which should not be resolved on a special motion to

dismiss. See Ferguson, 96 Mass. App. Ct. at 394-395. The

defendants have not shown that the option deadline was essential

as a matter of law, to the extent they are raising such an

argument. See Rex Lumber Co. v. Acton Block Co., 29 Mass. App.

Ct. 510, 515 (1990) (rule that "amendments to a contract that is

within the Statute of Frauds are themselves within the Statute

of Frauds" is subject to exception for "oral agreement[s] to

extend the time for performance").7

We likewise are unpersuaded by the defendants' contention

that the judge should have dismissed the complaint because it

failed to state expressly that the plaintiff did not send

written notice of its exercise of the option. General Laws

c. 184, § 15 (b), provides that a party seeking a memorandum of

lis pendens "shall commence the underlying proceeding by means

of a verified complaint" with a certification "that no material

facts have been omitted therefrom." "A party's failure to

include all material facts may result in the dismissal of that

party's claims where the omitted facts establish that those

claims are devoid of reasonable factual support or arguable

7 As the judge observed, there is also an "equitable qualification" to the Statute of Frauds. Hurtubise v. McPherson, 80 Mass. App. Ct. 186, 188-189 (2011). Whether equitable qualification might apply here depends on questions of fact, which cannot be resolved at this stage of the proceedings.

9 basis in law." McMann v. McGowan, 71 Mass. App. Ct. 513, 519-

520 (2008). Here, the judge concluded that the omission was not

material because the complaint acknowledges that the agreement

required the plaintiff to provide written notice; nowhere does

the complaint state that the plaintiff complied with this

requirement; and so "[t]he import" of the complaint, "read as a

whole, is that the plaintiff did not provide the requisite

written notice." We concur with the judge's assessment.

2. Motion for reconsideration. Finally, the defendants

argue that the judge should have reconsidered his decision based

on new evidence -- namely, the agreement, the amendment, and the

draft P&S, copies of which the defendants attached to their

motion to reconsider. New evidence in this context means

"evidence that could not be discovered through the exercise of

due diligence before the original motion was filed." Superior

Court Rule 9D (2023). There is no reason why the defendants

could not have attached these documents to their special motion

to dismiss. Moreover, the material provisions of the documents

were set out in the pleadings and considered by the judge in

denying the special motion to dismiss. The judge was thus

within his discretion to summarily deny the motion to

reconsider. See Audubon Hill S. Condominium Ass'n v. Community

10 Ass'n Underwriters of Am., Inc., 82 Mass. App. Ct. 461, 469-470

(2012).

Conclusion. The order dated October 31, 2023, denying the

defendants' special motion to dismiss and allowing the

plaintiff's motion for endorsement of a memorandum of lis

pendens is affirmed. The order dated November 27, 2023, denying

the defendants' motion for reconsideration is affirmed.

So ordered.

By the Court (Sacks, Shin & Hershfang, JJ.8),

Clerk

Entered: December 24, 2024.

8 The panelists are listed in order of seniority.