Stephen & Gregory Realty Co. v. Pytko

8 Mass. L. Rptr. 592
CourtMassachusetts Superior Court
DecidedJune 26, 1998
DocketNo. 980308B
StatusPublished

This text of 8 Mass. L. Rptr. 592 (Stephen & Gregory Realty Co. v. Pytko) 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
Stephen & Gregory Realty Co. v. Pytko, 8 Mass. L. Rptr. 592 (Mass. Ct. App. 1998).

Opinion

Fremont-Smith, J.

This matter arises out of an alleged default on obligations due under a note payable to the plaintiffs. The defendant, Nadeen Pytko (“Wife”) is presently moving to dismiss for failure to state claims upon which relief can be granted and for lack of subject matter jurisdiction due to a pending action in probate court. For the following reasons, the defendant’s motion to dismiss counts 2 and 8 is ALLOWED and defendant’s motion to dismiss counts 3 through 7 is DENIED.

BACKGROUND

The plaintiff Stephen and Gregory Realty, Inc. (“Business”) is a corporation which engages in the purchase and sale of real estate; manages and leases property; and constructs, repairs and maintains property. The plaintiff Paul P. Pytko (“Father”) is the President and a shareholder of the Business as well as the father of the defendant Paul F. Pytko.

The defendant Paul F. Pytko (“Husband”) is the Vice President of the Business and the only other shareholder of the company. Over a period of seven years, Wife performed bookkeeping and clerical services for the company.

The defendant Husband and Wife are parties in a divorce action presently pending in Worcester Probate and Family Court. In the fall of 1997, the Probate Court issued a temporary order restraining the Husband from transferring or conveying any marital assets, including restraining the Husband’s 50% stock interest in the Business.

On February 11, 1998, Father, on behalf of the Business, filed this action alleging multiple claims against Husband and Wife. The complaint alleged that the Husband defaulted on obligations to make certain payments under a note in the amount of $51,000 to the Father in his capacity as an officer of the Business. The complaint further alleges that payments under the note are secured by the Husband’s 50% stock ownership interest in the Business. The Father seeks by this action to compel the Husband to transfer his 50% ownership interest back to the Father based upon the default, and seeks damages for alleged deceptive behavior engaged in by the defendant Wife, misappropriation of corporate records and interference with the plaintiffs’ contractual relations.

The Wife moves to dismiss the action, arguing that the counts fail to state claims for which relief can be granted and are subject to dismissal for lack of subject matter jurisdiction. The wife also contends that the case presents repetitive issues already pending in probate court.

DISCUSSION

A.Standard of Review

When evaluating the sufficiency of a complaint pursuant to Mass.R.Civ.P. 12(b)(6), the court must determine whether the complaint states a claim upon which relief can be granted. The court must take the allegations of the complaint, as well as any inferences which can be drawn from those allegations in the plaintiffs favor, as true. The complaint should not be dismissed for failure to state a claim unless it appears beyond doubt that the plaintiff can prove no set of facts in support of its claim which would entitle it to relief. Nader v. Citron, 372 Mass. 96, 98 (1977), quoting Conley v. Gibson, 355 U.S. 41, 45-46 (1957); Whitinsville Plaza, Inc. v. Kotseas, 378 Mass. 85, 89 (1979).

B.Allegations of Breach of Probate Court Stipulations

Count II of the plaintiffs’ complaint alleges breach of a probate court stipulation and agreement. The defendant has moved to dismiss this count based upon lack of standing, lack of subject matter jurisdiction and failure to state a claim upon which relief can be granted. Upon defendant’s motion, the plaintiffs have agreed to dismiss this count in light of the probate court’s jurisdiction over the matter.

C.Viability of Claims Alleging Conversion and Misappropriation

Count II of the complaint alleges conversion and misappropriation of corporate assets against the Wife. The defendant is moving to dismiss this count, contending that she has delivered computer printouts and a corporate records prior to and subsequent to the preliminary injunction hearing, rendering the issue moot.

In its opposition, the plaintiffs maintain that the Wife still has possession of the 1997 corporate diary, the corporate seal, financing reports and deposit slips for December 1997. In its consideration of a motion to dismiss, the court must view the facts in a light most favorable to the plaintiff. Nader v. Citron, supra, 372 Mass. at 98. Taking the allegations alleged by the plaintiffs as true, the court is satisfied that the plaintiffs have stated claims for conversion and misappropriation against the Wife for which relief may be possible. Accordingly, dismissal of this count is inappropriate.

D.Sufficiency of Count Alleging Intentional Interference with Contractual Relations

The defendant Wife moves to dismiss count VII on the ground that the tort of intentional interference with contractual relations requires a showing that a defendant impinged upon plaintiffs’ existing or contractual relationship with a third party. The defendant contends that the plaintiffs’ present claim is devoid of third-party involvement and therefore should be dismissed for failure to state facts upon which relief can be granted.

[594]*594In its opposition, the plaintiffs maintain that the defendant interfered with the plaintiffs’ contractual obligations to its tenants. The plaintiffs state that the defendant refused to surrender corporate records pertaining to the plaintiffs’ leases with sixteen tenants, rendering the plaintiffs unable to fulfill its contractual obligations to the tenants.

“To establish intentional interference with contractual or business relations, the plaintiff must show: 1) the existence of a contract or a business relationship which contemplated economic benefit; 2) the defendant’s knowledge of the contractual or business relationship; 3) the defendant’s intentional interference with the contract or business relationship for an improper purpose or by improper means; and 4) damages.” Swanset Development Corp. v. Taunton, 423 Mass. 390, 397 (1996); United Truck Leasing Corp. v. Geltman, 406 Mass. 811, 812, 815-17 (1990).

The court is satisfied that the plaintiffs have pled sufficient facts to proceed with a claim for intentional interference with contractual relations in light of allegations of intentional disruption of the relationships between the plaintiffs and their tenants.

E. Allegations of Unfair and Deceptive Practices

The defendant Wife moves this court to dismiss count VIII alleging violations of G.L.c 93A on the basis that claims arising under G.L.c. 93A do not apply in situations involving employers and employees. In support of her contention, the defendant relies upon Hoffman v. Optima Systems, Inc., 683 F.Supp. 865 (D.Mass. 1988), which held that c. 93A claims are barred even if an employer/employee dispute occurs in the context of business dealings between the parties. Id. at 871. The Massachusetts Appeals Court has also dealt with the same issue in Newton v. Moffie, 13 Mass.App.Ct. 462 (1982), in which a c. 93A violation was alleged in a private transaction between individual members of the same partnership. Id. at 462. The court held that the transaction was not actionable under c. 93A where the transaction only affected the parties themselves and did not affect other businessmen or the interests of the public. Id.

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Related

Conley v. Gibson
355 U.S. 41 (Supreme Court, 1957)
Whitinsville Plaza, Inc. v. Kotseas
390 N.E.2d 243 (Massachusetts Supreme Judicial Court, 1979)
Lantner v. Carson
373 N.E.2d 973 (Massachusetts Supreme Judicial Court, 1978)
DuMont v. Godbey
415 N.E.2d 188 (Massachusetts Supreme Judicial Court, 1981)
Newton v. Moffie
434 N.E.2d 656 (Massachusetts Appeals Court, 1982)
Wood v. Wood
342 N.E.2d 712 (Massachusetts Supreme Judicial Court, 1976)
United Truck Leasing Corp. v. Geltman
551 N.E.2d 20 (Massachusetts Supreme Judicial Court, 1990)
Nader v. Citron
360 N.E.2d 870 (Massachusetts Supreme Judicial Court, 1977)
Hoffman v. Optima Systems, Inc.
683 F. Supp. 865 (D. Massachusetts, 1988)
Swanset Development Corp. v. City of Taunton
423 Mass. 390 (Massachusetts Supreme Judicial Court, 1996)

Cite This Page — Counsel Stack

Bluebook (online)
8 Mass. L. Rptr. 592, Counsel Stack Legal Research, https://law.counselstack.com/opinion/stephen-gregory-realty-co-v-pytko-masssuperct-1998.