Gross v. Prudential Insurance Co. of America, Inc.

718 N.E.2d 383, 48 Mass. App. Ct. 115
CourtMassachusetts Appeals Court
DecidedOctober 21, 1999
DocketNo. 98-P-1015
StatusPublished
Cited by46 cases

This text of 718 N.E.2d 383 (Gross v. Prudential Insurance Co. of America, Inc.) 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
Gross v. Prudential Insurance Co. of America, Inc., 718 N.E.2d 383, 48 Mass. App. Ct. 115 (Mass. Ct. App. 1999).

Opinion

Beck, J.

The plaintiffs are tenants in one of three residential apartment buildings constructed in the mid-1960’s as part of the Prudential Center on Boylston Street in Boston. The defendant, Prudential Insurance Company of America, is the owner and developer of the Prudential Center and the plaintiffs’ landlord. [116]*116When the voters of the Commonwealth elected to repeal rent control in 1994, the defendant notified the plaintiffs of a gradual rent increase. In response, the plaintiffs filed suit claiming that, because the defendant had received a public subsidy in the form of tax exemptions to build the Prudential Center, their apartments were “publicly subsidized” and therefore the law abolishing rent control did not apply to them. The plaintiffs also claimed that the rent increase was a breach of an agreement with the defendant to maintain the “rental status” of their apartments. A Superior Court judge rejected these arguments and granted summary judgment to the defendant. We affirm.

1. Factual and statutory background. We set out the broad principles governing the construction of the Prudential Center and the course of rent control legislation, reserving certain details for the discussion. In March, 1962, the defendant entered into a contract with the city of Boston (Boston) to “finance, construct, maintain and manage a redevelopment project, known as the Prudential Center complex, in the Back Bay area of Boston .... in accordance with the provisions and purposes of G. L. c. 121A.” Prudential Ins. Co. of America v. Boston, 369 Mass. 542, 543 (1976). Chapter 121A was enacted in 1945 to encourage privately financed projects to redevelop “blighted open, decadent or sub-standard areas” in order to provide “decent, safe and sanitary buildings for residential, commercial, industrial, institutional, recreational, or governmental purposes.” G. L. c. 121A, § 2. To encourage the necessary private investment, “the statute provides that a project undertaken by a qualified applicant, such as an insurance company, is exempt from State and local taxation, including betterments and special assessments, for a period of forty years.” Prudential Ins. Co. of America v. Boston, supra. In place of taxes, the defendant made annual payments to the city as set out in agreements with the city and consistent with G. L. c. 121A, § 10. See Prudential Ins. Co. of America v. Boston, supra at 543-544. The defendant’s original proposal “reserved a future option to construct residential units within the project area. In 1965, the mayor and the BRA [Boston Redevelopment Authority] approved [the defendant’s] plans to build [the] three residential rental apartment buildings” at issue here. Bronstein v. Prudential Ins. Co. of America, 390 Mass. 701, 702 (1984).

In 1970, the Legislature enacted an enabling statute authorizing certain cities and towns to institute rent control by setting [117]*117maximum rents for controlled rental units. St. 1970, c. 842, § 3. According to the preamble, the purpose of this legislation was “to alleviate the severe shortage of rental housing,” specifically the “substantial and increasing shortage of rental housing accommodations for families of low and moderate income.” St. 1970, c. 842, § 1. Boston accepted the provisions of the rent control act effective January 1, 1973. Prudential Ins. Co. of America v. Boston, 369 Mass. at 544. The rent control law applied to the apartments in the Prudential Center. Id. at 550.

In 1989, as part of its plan for a major redevelopment of the Prudential Center, the defendant petitioned the BRA to terminate the Prudential Center’s designation as a 121A project. To address the concerns of the tenants, the BRA required that the defendant agree to maintain the “rental status” of the apartments under G. L. c. 121A until August 31, 2001, the expiration of the original 121A project period. In exchange for this commitment, the Prudential Apartments Association, a tenants’ organization, testified in support of the defendant’s redevelopment plan at the required hearing before the BRA on December 14, 1989. On August 2, 1991, the defendant “executed” a one-page document entitled “AGREEMENT AS TO RENTAL STATUS OF RESIDENTIAL PROJECT — PRUDENTIAL CENTER APARTMENT BUILDINGS.”

At the election of November 8, 1994, the voters of the Commonwealth enacted the Massachusetts Rent Control Prohibition Act by initiative petition pursuant to art. 48 of the Amendments to the Constitution of the Commonwealth. St. 1994, § 368. See G. L. c. 40P.2 The purpose of the act was “to establish a uniform statewide policy that broadly prohibits any regulatory scheme based upon or implementing rent control.” G. L. c. 40P, § 2. The statute’s definition of the rent control arrangements to be eliminated excluded “the regulation of, or agreements affecting, publicly owned housing, publicly subsidized housing, federally assisted housing, or mobile homes.” G. L. c. 40P, § 3(c).

Shortly after the passage of the initiative petition, the Legislature enacted a “limited transitional statute .... providing] for certain rights and procedures in order to bring about the orderly termination of rent control.” Zuker v. Clerk-[118]*118Magistrate of the Brookline Div. of the Dist. Ct. Dept. of the Trial Ct., 423 Mass. 856, 859 (1996). See St. 1994, c. 282. This law specifically identified the Boston rent control ordinance, among others, as having been repealed. St. 1994, c. 282, § 3(e). It also specified, as relevant here, that “the provisions of this act [shall not] be deemed to limit the operation and enforceability of agreements . . . entered into by landlords in connection with the procuring of any subsidy or other form of financial assistance from a governmental agency.” Ibid.

In August, 1995, the defendant notified the plaintiffs of a proposed rent increase. The plaintiffs responded by filing a complaint on December 15, 1995, seeking a declaratory judgment that, because of the tax relief provided to the defendant under G. L. c. 121A, their apartments are “publicly subsidized housing” and therefore not within the definition of the rent control program abolished by G. L. c. 40P, § 3(c). Two years later, the parties filed cross motions for summary judgment. The plaintiffs also filed a late motion to amend their complaint by adding a contract count. A Superior Court judge allowed the plaintiffs’ motion to amend, denied their motion for summary judgment, and allowed the defendant’s motion for summary judgment.

The judge found that G. L. c. 40P, § 3(c), reflected the Legislature’s “intent that the prohibition on rent control would not affect the administration of rent restrictions in other subsidized housing programs.” He distinguished between the statutory structure and purposes associated with c. 121A and the rent control statutes and determined that the Prudential Center apartments were not publicly subsidized housing and therefore were not exempt from the law abolishing rent control. As to the contract claim, the judge found that the phrase “rental status” was not ambiguous and only “memorialized [the parties’] intent to maintain the apartments as rental units until August 31, 2001, as opposed to converting the rental units to condominium or cooperative units.” Accordingly, he also rejected the plaintiffs’ contract claim.

2. Discussion, (a) Standard of review.

Free access — add to your briefcase to read the full text and ask questions with AI

Related

Cole v. Lewis
111 N.E.3d 304 (Massachusetts Appeals Court, 2018)
Wilder Companies, Ltd. v. California Pizza Kitchen, Inc.
32 Mass. L. Rptr. 505 (Massachusetts Superior Court, 2015)
Verrill Farms, LLC v. Farm Family Casualty Insurance Co.
18 N.E.3d 1125 (Massachusetts Appeals Court, 2014)
Zurich American Insurance v. Watts Regulator Co.
860 F. Supp. 2d 78 (D. Massachusetts, 2012)
Crespo v. Cynosure, Inc.
25 Mass. L. Rptr. 390 (Massachusetts Superior Court, 2008)
Fore L Realty Trust v. McManus
884 N.E.2d 994 (Massachusetts Appeals Court, 2008)
AVX Corp. v. Cabot Corp.
23 Mass. L. Rptr. 428 (Massachusetts Superior Court, 2007)
Carr v. Entercom Boston, LLC
23 Mass. L. Rptr. 138 (Massachusetts Superior Court, 2007)
First Massachusetts Bank v. Florian
22 Mass. L. Rptr. 548 (Massachusetts Superior Court, 2007)
Realty v. McManus
2006 Mass. App. Div. 130 (Mass. Dist. Ct., App. Div., 2006)
American Commercial Finance Corp. v. Seneca Insurance
850 N.E.2d 1114 (Massachusetts Appeals Court, 2006)
Graham ex rel. Wile Family Trust v. Copperbeech Partnership Ltd.
20 Mass. L. Rptr. 345 (Massachusetts Superior Court, 2005)
Hoppe v. CMGI, Inc.
20 Mass. L. Rptr. 207 (Massachusetts Superior Court, 2005)
Meredith & Grew, Inc. v. Worcester Lincoln, LLC
831 N.E.2d 940 (Massachusetts Appeals Court, 2005)
BPR Group Ltd. Partnership v. Bendetson
18 Mass. L. Rptr. 593 (Massachusetts Superior Court, 2005)
Martha's Vineyard Land Bank Commission v. Board of Assessors
814 N.E.2d 1147 (Massachusetts Appeals Court, 2004)
PDC-El Paso Meriden, LLC v. Alstom Power, Inc.
18 Mass. L. Rptr. 14 (Massachusetts Superior Court, 2004)
Massachusetts Port Authority v. Ace Property & Casualty Insurance
17 Mass. L. Rptr. 589 (Massachusetts Superior Court, 2004)

Cite This Page — Counsel Stack

Bluebook (online)
718 N.E.2d 383, 48 Mass. App. Ct. 115, Counsel Stack Legal Research, https://law.counselstack.com/opinion/gross-v-prudential-insurance-co-of-america-inc-massappct-1999.