Kherlop v. Domos

28 Mass. L. Rptr. 254
CourtMassachusetts Superior Court
DecidedJanuary 24, 2011
DocketNo. 083342
StatusPublished

This text of 28 Mass. L. Rptr. 254 (Kherlop v. Domos) 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
Kherlop v. Domos, 28 Mass. L. Rptr. 254 (Mass. Ct. App. 2011).

Opinion

Billings, Thomas P., J.

The plaintiff (“Kherlop”), a designer-builder, prepared plans and undertook the construction (through subcontractors) of an addition to the defendants’ (the “Domoses’ ”) Belmont home. Concerned about what they were seeing, the Domoses terminated Kherlop on August 1, 2007, and ordered him and his subcontractors off the site. He brought this action, seeking damages for breach of contract. The Domoses counterclaimed, asserting counts for breach of contract, negligence, and violation of Chapter 93A, among others.

The case was tried to a juiy in my session on November 15-23,2010. With the parties’ concurrence, I submitted the Chapter 93A claim to the jury, reserving to myself only the question of whether, should the jury And a willful or knowing violation, the damages would be doubled, trebled, or something in between.

In response to special questions, the jury found that Kherlop had, before August 1, 2007, materially breached the contract, such that the Domoses were justified in terminating the contract on that date; this spelled the end of his contract claim. On the counterclaims, the jury found Kherlop liable for breach of contract, with damages of $172,350; in negligence, with damages of $202,308; and for violations of Chapter 93A, with damages of $15,000. On the 93A claim, the juiy determined that Kherlop had not “lowballed” the contract, but that his work had materially deviated from the plans and/or specifications and also violated the building laws of the Commonwealth (see G.L.c. 142A,§17),and that the violations were willful and/or knowing. Finally, the juiy specified that the total compensatoiy damages on all claims, without duplication, were $217,308.

At a further hearing on December 8, 2010, counsel were heard on four remaining issues;

1. Multiple damages: What amount of damages is to be multiplied, and whether multiplier should be 200% or 300%.
2. Attorneys Fees: The amount of reasonable attorneys fees to which the Domoses are entitled on account of the disposition of their claim under Chapter 93A. (On this issue, the fee affidavit of the Domoses’ counsel was filed and served just prior to the hearing, and lacked itemized billing statements. I provided additional time for counsel to provide the itemized statements, and for Kherlop’s counsel to respond. I have since received and reviewed these additional submissions.
3. Expert Fees: James Jozokos, an architect retained by the Domoses for the design work needed to perform corrective work and finish the project, was designated by the Domoses as both a fact and an expert witness, and was subpoenaed by Kherlop as a fact witness. Kherlop, the plaintiff, called Jozokos as part of his case; the Domoses’ counsel deferred cross examination at that time, but recalled Jozokos as part of their case, and elicited both fact and opinion testimony at that time, on which Kherlop’s counsel cross-examined. Jozokos spent some time in the courtroom waiting for Kherlop’s counsel to call him, for which he has billed the Domoses at his customaiy hourly rate, totaling $1,350, which the Domoses contend Kherlop should pay.
4. Interest Accrual Date: The Domoses seek to have the interest on so much of the damage award as represents the recoveiy on their contract claim figured from August 1, 2007, the date of breach.

I have since received further submissions on the Domoses’ claim for attorneys fees and costs.

The following are my rulings on these four issues, and the reasons therefor.

I. Multiple Damages.

To the juiy’s damage award of $217,308 will be added the sum of $30,000. This represents a trebling of the $15,000 award on the Chapter 93A claim.

The Domoses have urged that whatever multiplier is applied should pertain to the entire $217,308 awarded by the jury on all claims. They point to the following language in c. 93A, §9:

For the purposes of this chapter, the amount of actual damages to be multiplied by the court shall be the amount of the judgment on all claims arising out of the same and underlying transaction or occurrence, regardless of the existence or nonexistence of insurance coverage available in payment of the claim.

This sentence was added to the statute by St. 1989, c. 580, §1. As is usual in Massachusetts,1 the official legislative history behind the amendment is uninformative as to legislative intent. According to the unofficial account of the amendment’s proponent, however, its purpose was to legislatively overrule a line of cases that had limited multiple damages, in cases charging an insurance company with bad faith in refusing to settle an claim on which liability was reasonably clear, to damages representing loss of use of the money (i.e., [256]*256lost interest).2 Hailey, New Incentive for Insurers to Settle Claims Reasonably and Promptly, 34 BostonBarJ. 16, 18 (Sept./Oct. 1990).

Such intent is not, at least to this reader, obvious from the legislative language. Later cases interpreting the amendment—some citing Mr. Haley’s article— have, however, accepted that this earlier caselaw (see fn. 2) was “the ‘mischief the amendment was manifestly intended to correct.” See, e.g., Yeagle v. Aetna Cas. & Sur. Co., 42 Mass.App.Ct. 650, 653-54 & nn.3 & 4 (1997); Cohen v. Liberty Mut. Ins. Co., 41 Mass.App.Ct. 748, 754 (1996).

I am unaware of any cases interpreting the operative sentence outside the insurance bad faith context. It is one thing to rely on informed commentaiy for the proposition that the amendment was meant to remedy a particular “mischief,” even if the language does not clearly say so. It is another to ignore the statute’s language, which is considerably broader. I do not read the 1989 amendment as necessarily restricted to insurance bad faith cases (although this is a natural application of it; see below). The issue before me, then, is whether, on the evidence received at trial and with proper respect for the jury’s probable intent, the entirety of the Domos project should be considered a single “transaction or occurrence” for multiplication purposes, or whether the Court should confine its multiplication to the damages resulting from conduct that the jury found violated Chapter 93A.

The Chapter 93A claim was presented under three theories: (1) that Kherlop “lowballed” the contract price in the hope of recouping additional profit in “extras” for work that should have been anticipated and included in the original price,3 (2) that he “deviat[ed] from or disregard(ed) plans or specifications in [a] material respect without the consent of the owner,” and (3) that he “violat[ed] . . . the building laws of the commonwealth.”4

In instructing the jury, I forewent (with both counsel’s agreement) any extended and general exposition of what constitutes “unfair or deceptive” conduct, and focused on these three discrete issues. The jury found for the Domoses on the second and third theories and awarded $15,000 in damages, which they then specified was separate and apart from any damage resulting from breach of contract or negligence (the former being more than subsumed in the latter).5 This finding, and respect for the jury’s apparent intent ais a vis what was to be multiplied,6

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Bluebook (online)
28 Mass. L. Rptr. 254, Counsel Stack Legal Research, https://law.counselstack.com/opinion/kherlop-v-domos-masssuperct-2011.