EIC Development, LLC v. Mystic Valley Development Commission

16 Mass. L. Rptr. 138
CourtMassachusetts Superior Court
DecidedMarch 26, 2003
DocketNo. 014535
StatusPublished

This text of 16 Mass. L. Rptr. 138 (EIC Development, LLC v. Mystic Valley Development Commission) is published on Counsel Stack Legal Research, covering Massachusetts Superior Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
EIC Development, LLC v. Mystic Valley Development Commission, 16 Mass. L. Rptr. 138 (Mass. Ct. App. 2003).

Opinion

Gants, J.

The plaintiff, EIC Development, LLC (“EIC”), owns roughly 167,500 square feet of industrial condominium space within the Everett Industrial Condominiums at 69 Norman Street in Everett (“the Premises”).1 Through its Second Amended Complaint, EIC has brought a variety of claims against the defendants, all essentially alleging that the defendants are unreasonably thwarting EIC’s efforts to develop the Premises so that the defendant Mystic Valley Development Commission (“MVDC”) can obtain the property through sale or eminent domain on the cheap. The defendants have moved to dismiss all of EIC’s claims except Counts One, Two, Three, and Seven against the MVDC. After hearing and for the reasons stated below, the defendants’ motion to dismiss is allowed in part and denied in part.

THE ALLEGATIONS IN THE COMPLAINT

When evaluating the sufficiency of a complaint pursuant to Mass.RCiv.P. 12(b)(6), the court must accept as true the factual allegations of the complaint and all reasonable inferences favorable to the plaintiffs which can be drawn from those allegations. Fairneny v. Savogran, 422 Mass. 469, 470 (1996); Eyal v. Helen Broadcasting Corp., 411 Mass. 426, 429 (1991). The issue is whether the facts alleged, generously construed in favor of the plaintiffs, state a valid legal claim that would warrant relief on any theory of law. Whitinsville Plaza, Inc. v. Kotseas, 378 Mass. 85, 89 (1979). Therefore, the facts described below simply reflect the allegations in the Second Amended Complaint, generously construed in favor of EIC, and should not be seen as findings by the Court.

On August 9, 1996, the Massachusetts Legislature established the MVDC pursuant to Section 11 of Chapter 294 of the Acts of 1996 (“the Enabling Act”) for the purpose of developing “an industrial and office park through the collaboration of government at all levels, public and private institutions of higher education, and private enterprise; which park may include, among other activities, facilities for the carrying on of research and development and production of innovative and advanced communication technologies.” Enabling Act, §11(a). To assist in the development of this industrial and office park, commonly known as “Tele-Com City,” the MVDC was also authorized to eliminate and prevent “the spread of decadent or blighted open areas included within the project area.” Id. Among the actions the MVDC was authorized to take to eliminate urban blight within the project area were “the restoration and renewal of portions of such area by a program of voluntary repair and rehabilitation of buildings or other improvements or by the acquisition by gift, purchase or eminent domain of land and improvements thereon . . .” Id.

TeleCom City is to be built on roughly 200 acres of land in three citiesEverett, Malden, and Medford. The EIC Premises is located in Everett, within the planned area that is to become TeleCom City. EIC entered into a Purchase and Sale Agreement to acquire the EIC Premises in March 1997 (eighteen months after the enactment of the Enabling Act) from the Somerset Savings Bank, but did not close on its purchase until June 30, 1999.

Under the original Master Plan for TeleCom City, adopted by the MVDC and approved by all three cities, the EIC Premises were slated to be taken by eminent domain and demolished. The MVDC retained an appraiser to determine the fair market value of the EIC Premises and, in December 1997, informed EIC that it valued the property at $3 million. Rather than let the eminent domain proceedings take its course, EIC entered into negotiations in February 1998 to sell the Premises to the MVDC and reached an agreement with MVDC’s staff to sell the Premises for $3.6 million. In March 1998, EIC entered into a non-binding Letter of Understanding reflecting the agreement it had reached with MVDC’s staff, but this Letter of Understanding required the approval of the MVDC Board of Directors in order to become effective. Under the Enabling Act, however, any action by the MVDC that [140]*140applies to one of the three cities within TeleCom City may be vetoed by the mayor of that city, and the City Council of that city has no power to override that veto. Enabling Act at §ll(d)(5)(i). The defendant Mayor of the City of Everett, David Ragucci (“Mayor Ragucci”), threatened to exercise his veto over this sale, so the MVDC Board refused to approve the Letter of Understanding at its meeting in April 1998. At that meeting, Mayor Ragucci, in his dual capacities as Chairman of the MVDC and Mayor of the City of Everett, tabled the proposal to approve the Letter of Understanding, stating that the price was “too high,” and that the MVDC should wait to see if EIC obtained the financing it needed to close on the Purchase and Sale Agreement it had earlier entered into regarding the Premises.

As of April 1998, the EIC had a marketing agreement with the Somerset Savings Bank, who still owned the Premises, to market the Premises for lease by new tenants and to negotiate with existing tenants, and EIC had designated an agent to conduct the marketing and negotiations. EIC’s agent entered into discussions with the Massachusetts Water Resources Authority (“MWRA”) to lease the Premises to the MWRA for a new vehicle maintenance facility. In April 1998, the MWRA notified EIC’s agent that the Premises was one of four sites being considered for its new vehicle maintenance facility, but the MWRA removed the Premises from consideration after Mayor Ragucci sent a letter to the MWRA on May 22, 1998 recommending that it not lease the Premises for this purpose.

In May 1998, EIC entered into discussions with W.K. MacNamara Company (“MacNamara”) regarding its interest in leasing space within the Premises for a construction material recycling facility. However, these discussions led nowhere after Mayor Ragucci told a MacNamara representative that he would not allow any permits to issue from the City of Everett for the EIC Premises because he wanted to “starve EIC out.”

In June 1998, ReHarvest, LLC (“ReHarvest”), a business that recycled surplus food product into animal feed, executed a lease for space in the Premises. ReHarvest’s proposed use of the Premises was allowed as a matter of right under the City of Everett Zoning Ordinance at the time it entered into its lease. In June 1998, Mayor Ragucci told EIC and ReHarvest that he would not support the proposed use of the Premises by ReHarvest and would oppose any use of the Premises that was not contemplated under the MVDC Master Plan. Nonetheless, in November 1998, ReH-arvest obtained a building permit from the City of Everett to commence improvements to the Premises that it planned to occupy.

By March 1999, the City of Everett had enacted a Site Plan Review Ordinance that regulated, among other things, the internal use of vacant space within the EIC Premises. When ReHarvest applied for a new building permit to continue its internal improvements to the Premises, the permit was denied. ReHarvest was told that its planned use of the Premises was now subj ect to the Site Plan Review Ordinance and that site plan approval was now needed for the intended use.

In July 1999, the City of Everett voted to revise its Zoning Ordinances to create a Telecommunications Overlay District, which had the effect of eliminating most industrial uses within the portion of the City of Everett that was part of the TeleCom City Master Plan Area, including the EIC Premises. In September 1999, the City of Everett Planning Board refused to approve ReHarvest’s site plan.

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Bluebook (online)
16 Mass. L. Rptr. 138, Counsel Stack Legal Research, https://law.counselstack.com/opinion/eic-development-llc-v-mystic-valley-development-commission-masssuperct-2003.