Shamrock Realty Co. v. O'Brien

21 Mass. L. Rptr. 25
CourtMassachusetts Superior Court
DecidedMarch 30, 2006
DocketNo. 024097
StatusPublished

This text of 21 Mass. L. Rptr. 25 (Shamrock Realty Co. v. O'Brien) 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
Shamrock Realty Co. v. O'Brien, 21 Mass. L. Rptr. 25 (Mass. Ct. App. 2006).

Opinion

Connolly, Thomas E., J.

In this case the plaintiff, Shamrock Realty Company, Inc. (“Shamrock”) seeks to enforce a personal guarantee agreement dated April 27, 1993, and signed by the defendant, David O’Brien (“O’Brien”). On July 1, 2004 this court (Connolly, J.) allowed Shamrock’s Motion for Summary Judgment. Now before the court is O’Brien’s October 6, 2004 Motion for Reconsideration of that order. Also still before the court is O’Brien’s Cross Motion for Summary Judgment which was filed on September 24, 2003. For the reasons stated below, this court’s July 1, 2004 order granting Shamrock summary judgment is VACATED and upon reconsideration said motion is DENIED. O’Brien’s Motion for Reconsideration and Cross Motion for Summary Judgment are ALLOWED.

BACKGROUND

Joseph X. O’Brien, Jr., the late owner of Starboard Tack Limited (“Starboard”), died in 1990. At the time of his death, Joseph X. O’Brien was obligated to Newport Federal Savings Bank (“Newport Bank”) on two outstanding notes which were secured, in part, by mortgages on the real property of Starboard. Joseph X. O’Brien died intestate and ownership of Starboard passed to his parents who, in turn, conveyed it to Joseph’s brother, the defendant David O’Brien, and to Joseph’s sister, Damien O’Brien.

At least one of the notes went into default in early 1993 and Newport Bank scheduled foreclosure. On March 31, 1993, Starboard entered into an agreement with John Gullison (“Gullison”) and Shamrock, an entity wholly owned and controlled by Gullison. The agreement indicated that “Gullison and Starboard Tack are interested in making an agreement to their mutual advantage, which would include the avoidance of the cost of [Starboard’s] filing of a bankruptcy petition.” In this agreement, Gullison and/or Shamrock basically agreed to provide money to Starboard to purchase at a foreclosure auction the Starboard properties that secured the Newport Bank notes.

On April 1, 1993, GFT Investment Company (a “lending” company also wholly owned and controlled by John Gullison) purchased from Newport Bank the notes and mortgages. GFT in turn sold the property to Starboard for the sum of $150,000 pursuant to a foreclosure sale. At that time, Starboard executed a promissory note in favor of Shamrock in the principal amount of $240,000.

On April 27, 1993 David O’Brien and his sister Damien O’Brien signed a personal guarantee of the $240,000 note. At the time he signed the guarantee agreement David O’Brien was living in Massachusetts. David O’Brien signed the document in Massachusetts and returned it to Rhode Island via fax and mail. Paragraph 12 of the personal guarantee agreement states:

IN THE EVENT THAT LENDER BRINGS ANY ACTION OR PROCEEDING IN CONNECTION HEREWITH IN ANY COURT OF RECORD OF THE STATE OF RHODE ISLAND, OR ANY UNITED STATES DISTRICT COURT LOCATED IN SAID STATE, GUARANTOR HEREBY IRREVOCABLY CONSENTS TO AND CONFERS PERSONAL JURISDICTION OF SUCH COURT OVER GUARANTOR BY SUCH COURT. (Capitalization in original.)

[26]*26This is the only section in the personal guarantee agreement that addresses jurisdiction or choice of law.

On or about October 27, 1993, the Shamrock note went into default. In March of 1994, the real estate, personal property, fixtures and liquor license of Starboard were foreclosed on. Plaintiff claimed a deficiency balance.

This case was commenced on September 17, 2002 in Suffolk Superior Court. Damien O’Brien, David O’Brien’s sister, was also a party defendant, but was dismissed as a defendant due to plaintiffs failure to make timely service of process on her. Both parties filed motions for summary judgment. A hearing on these motions was held on December 16, 2003. On July 1, 2004 the court (Connolly, J.) granted summary judgment in favor of Shamrock’s through a handwritten endorsement of Shamrock’s motion.

DISCUSSION

Superior Court Rule 9D governs motions for reconsideration. The deciding judge has the authority and discretion to reconsider the motion. Although a judge should not lightly undo his own work or the work of another judge, the power to reconsider an issue remains in the court until final judgment. Riley v. Presnell, 409 Mass. 239, 242 (1991), citing Peterson v. Hopson, 306 Mass. 597, 601 (1940); Barbosa v. Hopper Feeds, Inc., 404 Mass. 610, 622 (1989). In the present case, separate and final judgment has not entered, no damages have been assessed, and this court has the authority to reconsider its earlier motion.

This case, although long on the facts, presents a fairly simple issue. There is no issue as to whether Massachusetts and/or Rhode Island have jurisdiction over this lawsuit. In both states there is jurisdiction for this lawsuit to be brought. The only issue here is choice of law, i.e., which state’s statute of limitations should apply to this case. There is no dispute that the plaintiff waited at least 8 years from the date on which the cause of action accrued to bring this suit. Massachusetts has a six-year statute of limitation for actions brought on contract. G.L.c. 260, §2.1 Rhode Island has a ten-year statute of limitations on contract actions not under seal. R.I. Gen. Laws §9-l-13(a). Thus if the Massachusetts statute of limitations applies to this case, the action is barred by that statute.

When the court first considered this case and granted Shamrock’s motion for summary judgment it relied on representations of plaintiffs counsel and reached a conclusion which given further review of the facts and law was clearly erroneous. First, in its original decision, the court assumed that the guarantee agreement contained a choice of law provision that provided for Rhode Island law. This is not the case. The guarantee agreement contains only a paragraph in which the guarantor consents to personal jurisdiction in Rhode Island. The agreement does not specify which state’s law the guarantee agreement is to be governed by. Although the underlying note does provide that the note is to be governed by the laws of Rhode Island, the guarantee agreement is a separate and distinct contract. See Hurley v. Merowitz, 55 Mass.App.Ct. 920, 920 (2002). The note and the guarantee do not involve the same parties and the terms that the note imposes upon Starboard cannot be imputed against O’Brien.

Secondly, contrary to the plaintiffs argument, there is no evidence that the guarantee agreement was executed in Rhode Island. In fact, all the evidence in the summary judgment record indicates that O’Brien, while residing in Massachusetts, signed the guarantee in Massachusetts and returned it to Shamrock via fax and post. In addition to O’Brien’s affidavit, a memo initialed by Shamrock’s president, John Gullison, supports this conclusion when it states, “In terms of David’s signature for purposes of the guarantee, I would suggest that tomorrow Damien obtain a fax signature from David and provide the original by Monday by Federal Express.” This memo supports the inference that David O’Brien was living outside of Rhode Island at the time.

Given that the guarantee agreement contains no choice of law provisions and was executed in Massachusetts, there is no reason to apply the Rhode Island statute of limitations. The choice of law provisions in the separate and distinct note are not controlling in this case.

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Related

Barbosa v. HOPPER FEEDS. INC.
537 N.E.2d 99 (Massachusetts Supreme Judicial Court, 1989)
Riley v. Presnell
565 N.E.2d 780 (Massachusetts Supreme Judicial Court, 1991)
Peterson v. Hopson
29 N.E.2d 140 (Massachusetts Supreme Judicial Court, 1940)
New England Telephone & Telegraph Co. v. Gourdeau Construction Co.
647 N.E.2d 42 (Massachusetts Supreme Judicial Court, 1995)
Hurley v. Merowitz
774 N.E.2d 1168 (Massachusetts Appeals Court, 2002)

Cite This Page — Counsel Stack

Bluebook (online)
21 Mass. L. Rptr. 25, Counsel Stack Legal Research, https://law.counselstack.com/opinion/shamrock-realty-co-v-obrien-masssuperct-2006.