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-459
ANDREW C. STRANBERG
vs.
THE COOPERATIVE BANK.
MEMORANDUM AND ORDER PURSUANT TO RULE 23.0
The plaintiff, Andrew Stranberg, appeals from a decision of
a judge of the Superior Court granting summary judgment in favor
of the defendant, The Cooperative Bank (bank). We affirm.
Background. On July 31, 2018, Stranberg, through an entity
owned by him, entered into a purchase and sale agreement to buy
a commercial building for $6.15 million with a closing date set
for August 31. Various amendments to the agreement (through
September 17) reduced the price to $5.95 million and extended
the closing to October 3. Seeking financing for the purchase,
Stranberg contacted the bank on September 12, and the following
day spoke to two of its employees, Miguel Rosado and Nancy Reid. The next day, September 14, Stranberg signed a loan term
sheet prepared by the bank. The term sheet cautioned, "[t]he
actual terms and conditions under which the Bank would be
willing to lend are subject to the completion of all due
diligence required by the Bank including, but not limited to,
credit approval, collateral evaluation, a review of all legal
documentation, and any other criteria or conditions as
determined by the Bank at its sole discretion." The term sheet
further cautioned "that this is not a commitment but strictly a
proposal," that the loan "request will be reviewed and
analyzed," and that "[i]f approved, the Bank will issue a formal
commitment letter."
Due diligence began once Stranberg submitted his commercial
loan application and personal financial statement on September
17 and continued with repeated communication with Stranberg
through October 2. On September 27, the bank completed an
internal loan presentation report that raised serious questions
about the loan. After reviewing financial data, Rosado
determined that the loan as presented would have "no chance" of
approval by the bank's loan committee without changes being
made, and he decided that he would not "sign off" on the
proposal as a loan officer. On September 28, Rosado contacted
Stranberg and proposed new terms, and Stranberg agreed.
2 According to Stranberg, before and after September 28, Rosado,
Reid, and a third bank employee repeatedly assured him that the
bank would provide financing "as long as the appraisal and
environmental report . . . were satisfactory." Stranberg signed
a revised term sheet on October 1 containing the same cautionary
language as the prior term sheet. That same day, the loan
committee met and expressed concerns with the loan. On October
2, the bank decided to decline the loan, and Rosado informed
Stranberg of the bank's decision.
After arranging alternative financing through investors,
Stranberg ultimately purchased the property, but he incurred
additional costs and lost a substantial ownership interest in
the property. He filed a complaint for damages against the bank
in the Superior Court and alleged equitable estoppel and unfair
and deceptive conduct in violation of G. L. c. 93A. A judge
entered summary judgment in favor of the bank.
Discussion. We apply de novo review to summary judgment to
"determine whether, viewing the evidence in the light most
favorable to the nonmoving party, all material facts have been
established and the moving party is entitled to judgment as a
matter of law." Galenski v. Erving, 471 Mass. 305, 307 (2015).
1. Equitable estoppel. Stranberg contends that summary
judgment should not have entered on his equitable estoppel claim
3 because he reasonably relied to his detriment on the bank
employees' representations that the bank would provide financing
if the appraisal and the environmental report were satisfactory.
"An essential element under the promissory estoppel theory is
that there be an unambiguous promise and that the party to whom
the promise was made reasonably relied on the representation."
Rhode Island Hosp. Trust Nat'l. Bank v. Varadian, 419 Mass. 841,
848 (1995). "[A]n action based on reliance is equivalent to a
contract action, and the party bringing such an action must
prove all the necessary elements of a contract other than
consideration." Id. at 850. We conclude that the
representations by the bank employees did not constitute an
unambiguous promise, and Stranberg did not reasonably rely on
those representations.
Assurances by bank employees that financing would be
available "as long as the appraisal and environmental report
. . . were satisfactory" did not amount to a promise in a
contractual sense. These assurances were made while the bank
and Stranberg continued to discuss the terms of this
multimillion-dollar loan and before the bank had made its
decision after completing due diligence. When these assurances
were made at various (unspecified) times, Stranberg and the bank
logically "contemplated a written agreement that would govern
4 the intricacies" of the loan. Varadian, 419 Mass. at 850.
"Particularly in the context of a complex commercial
transaction, we have had occasion to caution against the
transformation of general expressions of intent, when
significant details remain to be resolved, into legally binding
agreements." Pappas Indus. Parks, Inc. v. Psarros, 24 Mass.
App. Ct. 596, 599 (1987). This is a case of "imperfect
negotiations which did not give rise to an enforceable promise."
Id.
We also discern no reasonable reliance by Stranberg for
several reasons. First, the inchoate nature of the negotiations
between Stranberg and the bank rendered any reliance
unreasonable. See Varadian, 419 Mass. at 850; Psarros, 24 Mass.
App. Ct. at 599. This conclusion is buttressed by the fact that
Stranberg had substantial business experience. See Varadian,
supra (in the absence of promise in "contractual sense" reliance
by "experienced businessmen" would be unreasonable); Psarros,
supra (without "presumed agreement" reliance by "businessman"
would be unreasonable). Second, the term sheets expressly
cautioned against relying on any suggestion that the bank
promised to approve the loan and noted the following: due
diligence would be required, the bank maintained discretion in
its review, the bank disclaimed any commitment to approve the
5 loan, the term sheet constituted a proposal, the loan request
required further review and analysis, and a formal commitment
letter would issue "[i]f approved." Third, the bank's request
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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-459
ANDREW C. STRANBERG
vs.
THE COOPERATIVE BANK.
MEMORANDUM AND ORDER PURSUANT TO RULE 23.0
The plaintiff, Andrew Stranberg, appeals from a decision of
a judge of the Superior Court granting summary judgment in favor
of the defendant, The Cooperative Bank (bank). We affirm.
Background. On July 31, 2018, Stranberg, through an entity
owned by him, entered into a purchase and sale agreement to buy
a commercial building for $6.15 million with a closing date set
for August 31. Various amendments to the agreement (through
September 17) reduced the price to $5.95 million and extended
the closing to October 3. Seeking financing for the purchase,
Stranberg contacted the bank on September 12, and the following
day spoke to two of its employees, Miguel Rosado and Nancy Reid. The next day, September 14, Stranberg signed a loan term
sheet prepared by the bank. The term sheet cautioned, "[t]he
actual terms and conditions under which the Bank would be
willing to lend are subject to the completion of all due
diligence required by the Bank including, but not limited to,
credit approval, collateral evaluation, a review of all legal
documentation, and any other criteria or conditions as
determined by the Bank at its sole discretion." The term sheet
further cautioned "that this is not a commitment but strictly a
proposal," that the loan "request will be reviewed and
analyzed," and that "[i]f approved, the Bank will issue a formal
commitment letter."
Due diligence began once Stranberg submitted his commercial
loan application and personal financial statement on September
17 and continued with repeated communication with Stranberg
through October 2. On September 27, the bank completed an
internal loan presentation report that raised serious questions
about the loan. After reviewing financial data, Rosado
determined that the loan as presented would have "no chance" of
approval by the bank's loan committee without changes being
made, and he decided that he would not "sign off" on the
proposal as a loan officer. On September 28, Rosado contacted
Stranberg and proposed new terms, and Stranberg agreed.
2 According to Stranberg, before and after September 28, Rosado,
Reid, and a third bank employee repeatedly assured him that the
bank would provide financing "as long as the appraisal and
environmental report . . . were satisfactory." Stranberg signed
a revised term sheet on October 1 containing the same cautionary
language as the prior term sheet. That same day, the loan
committee met and expressed concerns with the loan. On October
2, the bank decided to decline the loan, and Rosado informed
Stranberg of the bank's decision.
After arranging alternative financing through investors,
Stranberg ultimately purchased the property, but he incurred
additional costs and lost a substantial ownership interest in
the property. He filed a complaint for damages against the bank
in the Superior Court and alleged equitable estoppel and unfair
and deceptive conduct in violation of G. L. c. 93A. A judge
entered summary judgment in favor of the bank.
Discussion. We apply de novo review to summary judgment to
"determine whether, viewing the evidence in the light most
favorable to the nonmoving party, all material facts have been
established and the moving party is entitled to judgment as a
matter of law." Galenski v. Erving, 471 Mass. 305, 307 (2015).
1. Equitable estoppel. Stranberg contends that summary
judgment should not have entered on his equitable estoppel claim
3 because he reasonably relied to his detriment on the bank
employees' representations that the bank would provide financing
if the appraisal and the environmental report were satisfactory.
"An essential element under the promissory estoppel theory is
that there be an unambiguous promise and that the party to whom
the promise was made reasonably relied on the representation."
Rhode Island Hosp. Trust Nat'l. Bank v. Varadian, 419 Mass. 841,
848 (1995). "[A]n action based on reliance is equivalent to a
contract action, and the party bringing such an action must
prove all the necessary elements of a contract other than
consideration." Id. at 850. We conclude that the
representations by the bank employees did not constitute an
unambiguous promise, and Stranberg did not reasonably rely on
those representations.
Assurances by bank employees that financing would be
available "as long as the appraisal and environmental report
. . . were satisfactory" did not amount to a promise in a
contractual sense. These assurances were made while the bank
and Stranberg continued to discuss the terms of this
multimillion-dollar loan and before the bank had made its
decision after completing due diligence. When these assurances
were made at various (unspecified) times, Stranberg and the bank
logically "contemplated a written agreement that would govern
4 the intricacies" of the loan. Varadian, 419 Mass. at 850.
"Particularly in the context of a complex commercial
transaction, we have had occasion to caution against the
transformation of general expressions of intent, when
significant details remain to be resolved, into legally binding
agreements." Pappas Indus. Parks, Inc. v. Psarros, 24 Mass.
App. Ct. 596, 599 (1987). This is a case of "imperfect
negotiations which did not give rise to an enforceable promise."
Id.
We also discern no reasonable reliance by Stranberg for
several reasons. First, the inchoate nature of the negotiations
between Stranberg and the bank rendered any reliance
unreasonable. See Varadian, 419 Mass. at 850; Psarros, 24 Mass.
App. Ct. at 599. This conclusion is buttressed by the fact that
Stranberg had substantial business experience. See Varadian,
supra (in the absence of promise in "contractual sense" reliance
by "experienced businessmen" would be unreasonable); Psarros,
supra (without "presumed agreement" reliance by "businessman"
would be unreasonable). Second, the term sheets expressly
cautioned against relying on any suggestion that the bank
promised to approve the loan and noted the following: due
diligence would be required, the bank maintained discretion in
its review, the bank disclaimed any commitment to approve the
5 loan, the term sheet constituted a proposal, the loan request
required further review and analysis, and a formal commitment
letter would issue "[i]f approved." Third, the bank's request
for information beyond the appraisal and environmental review
and the agreed-upon changes made to the term sheets indicates
that loan approval was far from certain, and any reliance by
Stranberg in the face of such uncertainty was unreasonable.
2. Unfair or deceptive acts or practices. General Laws
c. 93A, § 2 (a), prohibits "[u]nfair or deceptive acts or
practices." When considering a c. 93A claim, "[a]lthough
whether a particular set of acts, in their factual setting, is
unfair or deceptive is a question of fact . . . the boundaries
of what may qualify for consideration as a c. 93A violation is a
question of law" (citation omitted). Milliken & Co. v. Duro
Textiles, LLC, 451 Mass. 547, 563 (2008). Stranberg bases his
claim on the previously discussed representations of the bank
employees as well as the bank's failure to disclose its internal
decision-making process. He contends that through this conduct,
the bank "strung him along" in the loan process and caused him
to forgo other financing opportunities. We disagree.
While "stringing along" that induces detrimental reliance
may, in some circumstances, constitute a c. 93A violation, see
Greenstein v. Flatley, 19 Mass. App. Ct. 351, 356 (1985),
6 statements by bank employees here were made in the context of
preliminary discussions, which the parties expected to be
finalized, if at all, in loan documentation. There is nothing
"immoral, unethical, oppressive, or unscrupulous -- and
therefore not unfair or deceptive -- to break off incomplete and
imperfect negotiations of a commercial agreement." Psarros, 24
Mass. App. Ct. at 600. See, e.g., Lambert v. Fleet Nat'l Bank,
449 Mass. 119, 127 (2007) (bank's statements that it would renew
loan were "made in the context of preliminary negotiations" and
were neither unfair nor deceptive). Also, as previously
discussed, we discern no reasonable reliance, "an essential
element" in cases involving stringing along prey, Psarros, 24
Mass. App. Ct. at 599, and Stranberg has not articulated how the
bank -- in the business of lending money -- would have achieved
a "more advantageous deal" by keeping him on a string but
ultimately declining to loan him money. Flatley, 19 Mass. App.
Ct. at 354. Finally, Stranberg points to no authority, and we
are unaware of any, that requires a bank to disclose its
internal decision-making process to a potential borrower in a
commercial loan transaction. Contrary to Stranberg's
contention, the record indicates that the bank actually
disclosed an overall process for loan approval: due diligence
included, but was not limited to, "credit approval, collateral
7 evaluation, a review of all legal documentation, and any other
criteria or conditions as determined by the Bank at its sole
discretion." Following due diligence and the exercise of
business judgment, the loan application followed this general
process, but in the end did not appeal to the bank. "Every deal
that goes sour does not give rise to a c. 93A claim." Psarros,
24 Mass. App. Ct. at 600.
Judgment affirmed.
By the Court (Meade, Hodgens & Toone, JJ.1),
Clerk
Entered: June 27, 2025.
1 The panelists are listed in order of seniority.