Colony of Wellfleet, Inc. v. Harris

883 N.E.2d 1235, 71 Mass. App. Ct. 522, 2008 Mass. App. LEXIS 384
CourtMassachusetts Appeals Court
DecidedApril 7, 2008
DocketNo. 07-P-287
StatusPublished
Cited by16 cases

This text of 883 N.E.2d 1235 (Colony of Wellfleet, Inc. v. Harris) is published on Counsel Stack Legal Research, covering Massachusetts Appeals Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Colony of Wellfleet, Inc. v. Harris, 883 N.E.2d 1235, 71 Mass. App. Ct. 522, 2008 Mass. App. LEXIS 384 (Mass. Ct. App. 2008).

Opinion

Cypher, J.

The Colony of Wellfleet, Inc. (the Colony), appeals from a judgment of the Land Court denying the Colony’s request that the court expunge a 1978 deed transferring title to a cottage and the land upon which it is located (lot 49) to Edith Keyes Harris. The Colony argues that the Land Court judge (1) had a duty under G. L. c. 185, § 114, to expunge an errone[523]*523pus registration of a deed in fee where the transferee was not a purchaser in good faith; (2) committed an error of law in ruling that the Colony ratified the 1978 deed in 1983; and (3) erred in finding the Colony guilty of loches. We affirm.

Background. A judge in the Land Court found the following facts, which we accept unless they are clearly erroneous. Mass. R.Civ.P. 52(a), as amended, 423 Mass. 1402 (1996). A finding is clearly erroneous when “although there is evidence to support it, the reviewing court on the entire evidence is left with the definite and firm conviction that a mistake has been committed.” Demoulas v. Demoulas Super Mkts., Inc., 424 Mass. 501, 509 (1997), quoting from Building Inspector of Lancaster v. Sanderson, 372 Mass. 157, 160 (1977).

On November 22, 1963, the Colony purchased registered land from the Mayo Hill Colony, Inc. The land housed nine cottages which were rented seasonally. At the time of the purchase, Loris Stefani (Loris) was the sole shareholder of the Colony, although he operated the cottage colony with Eleanor Stefani (Eleanor).2

The Colony was often subject to financial problems. As a result, it fell behind on mortgage payments and foreclosure proceedings were commenced. On October 30, 1970, Loris transferred certain real estate and stock to his sons, Marco and Paul Stefani, and to Attorney Charles E. Frazier, Jr., as part of a refinancing to avoid foreclosure. This transaction provided that upon payment of the existing mortgages, title to lot 17 and the stock of the Colony would be returned to Loris. The plan further provided for lot F-10 to be subdivided, with authority for the lots to be sold. On December 9, 1971, a judge of the Land Court approved a partial subdivision plan of lot F-10, resulting in the creation of lots 39 to 52. On September 30, 1972, the Colony’s stockholders and officers voted (the vote) to authorize Frazier to sell the lots for a period of five years from that date. In accordance with his authority as granted by the vote, Frazier sold six lots between October 21, 1972, and December 1, 1975, [524]*524one of which was the sale of lot 40 to Harris on April 30, 1975.3

On November 1, 1976, Loris commenced actions in Superior Court (the suit) against his sons and Frazier to recover his stock and lot 17. Loris died on January 26, 1978, and William E. Crowell, Jr., the executor of his estate, was substituted as the plaintiff in the suit. Upon his death, Loris left all of his interest in the Colony to Eleanor.

In the summer of 1978, Harris spoke to Eleanor regarding the purchase of cottage 10B, which stands on lot 49. Eleanor told Harris that there could be no sale of the cottage due to the outstanding court case. After Harris’s conversation with Eleanor, Harris approached Frazier and his attorney, Sidney Dockser, and was told that lot 49 was for sale at a price of $40,000.

On August 18, 1978, the Colony and Harris signed a purchase agreement for the sale of lot 49 for the sum of $40,000. Eleanor learned of the sale of lot 49 shortly after the purchase and sale agreement was signed. Lot 49 was conveyed to Harris by deed dated October 7, 1978. The proceeds from the sale were used to pay operating costs of the Colony.

Dockser represented Boris’s estate and Eleanor in the suit. In 1978, Dockser advised Eleanor that the sale of lot 49 to Harris was final. As the suit continued, Eleanor hired new counsel, Judith Bowman and Paul Counihan, both of whom were retained during the summer of 1979. Many times during the suit and after the trial in 1979, Eleanor asked Bowman and Counihan if there was anything she could do regarding lot 49, which she asserted Harris had “stolen.” Based on those conversations, Eleanor concluded that the sale of lot 49 was final.

On October 22, 1979, a Superior Court judge decided in favor of Boris’s estate, and ordered that the stock in the Colony and lot 17 be held in trust for the benefit of Boris’s estate. The ownership of lot 49 was not raised in the suit.

In 1983, a dispute arose between the Colony and Harris over the ownership of lot 49. Eleanor hired Bowman as her counsel, and was again advised that the sale of lot 49 to Harris was final. This dispute never resulted in a court action, and was not otherwise resolved.

[525]*525Frazier died before this current Land Court action was initiated. Harris was ninety-nine years old when this action was initiated, and died before trial.

The Land Court case. The Colony argued before the Land Court that Frazier lacked corporate authority to execute the deed to Harris and, as a result, the transfer certificate was issued in error and should be subject to the provisions of G. L. c. 185, § 114. Harris argued that Frazier and Dockser told Harris that they had the authority to sell lot 49 and that Frazier was acting with apparent authority when he executed the deed.

The trial judge first noted that the vote authorizing Frazier to sell the lots expired on September 30, 1977; therefore the deed, which was dated October 7, 1978, was not valid because Frazier did not have actual authority to sell lot 49. Frazier’s express authority to sell the lots owned by the Colony was limited by the fact that Frazier was only empowered to sell the lots for a duration of five years. Once that five-year window had closed, Frazier Tacked actual authority to sell any of the lots owned by the Colony.

Having concluded that Frazier did not have actual authority to sell lot 49, the trial judge addressed the issue of apparent authority and found that Harris could not have held a reasonable belief that Frazier had authority to execute the deed. Harris had spoken with Eleanor about the possibility of purchasing one of the units on lot 49, and had been informed that no land could be sold due to the dispute as to the ownership of the Colony, the subject of a pending action in Superior Court. The trial judge concluded that without a reasonable belief on the part of Harris that Frazier had the authority to sell lot 49, the doctrine of apparent authority did not apply.

The trial judge determined that the Colony qualified as a “person in interest” under G. L. c. 185, § 114, and as such was permitted to bring a petition in the Land Court to correct the error of the recorder in issuing the transfer certificate for the deed despite Frazier’s lack of corporate authority to continue to sell lots on behalf of the Colony.

The trial judge found that Harris was not protected from the provisions of § 114 because she was not a “purchaser in good [526]*526faith.”4 As such, the trial judge concluded that the Land Court was authorized to cancel the certificate.5

The Land Court judge concluded that the October 7, 1978, deed to Harris was executed by Frazier after his authority under the 1972 vote had expired, and as such, the provisions of G. L. c. 185, § 114, apply.

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Bluebook (online)
883 N.E.2d 1235, 71 Mass. App. Ct. 522, 2008 Mass. App. LEXIS 384, Counsel Stack Legal Research, https://law.counselstack.com/opinion/colony-of-wellfleet-inc-v-harris-massappct-2008.