Opinion
19-P-1397
09-25-2020
FIRST HYANNIS REALTY LLC v. THE STOP & SHOP SUPERMARKET COMPANY, LLC, & others.
NOTICE: Summary decisions issued by the Appeals Court pursuant to M.A.C. Rule 23.0, as appearing in 97 Mass. App. Ct. 1017 (2020) (formerly known as rule 1:28, as amended by 73 Mass. App. Ct. 1001 [2009]), are primarily directed to the parties and, therefore, may not fully address the facts of the case or the panel's decisional rationale. Moreover, such decisions are not circulated to the entire court and, therefore, represent only the views of the panel that decided the case. A summary decision pursuant to rule 23.0 or rule 1:28 issued after February 25, 2008, may be cited for its persuasive value but, because of the limitations noted above, not as binding precedent. See Chace v. Curran, 71 Mass. App. Ct. 258, 260 n.4 (2008).
MEMORANDUM AND ORDER PURSUANT TO RULE 23.0
This appeal arises out of sales of adjacent parcels of land by defendant Cape Cod Aggregates Corporation (CCA) to two competing developers in 2004 and 2006. On one side of the road, plaintiff First Hyannis Realty LLC (First Hyannis), sought to develop land for a BJ's Wholesale Club (BJ's) and a second retailer. On the other side of the road, defendants Atlantis Iyanough Realty LLC (Atlantis), and The Stop & Shop Supermarket Company, LLC (Stop & Shop), sought to develop land for a Stop & Shop. Following a dispute over the location of the entranceway to the BJ's parking lot and, subsequently, several unsuccessful lawsuits brought by Atlantis and Stop & Shop challenging First Hyannis's development plans, First Hyannis brought this lawsuit in 2015 alleging that the defendants engaged in a scheme, dating back to 2006, to deprive First Hyannis of its development opportunities. Because we conclude that the statutes of limitations had run on First Hyannis's claims by 2015, or that those claims otherwise fail as a matter of law, we affirm the judgment.
Background. The background of this case dates back to 1996, when CCA agreed to sell land north of Attucks Lane to First Hyannis's predecessor in interest; First Hyannis intended to construct a BJ's and a second retail building thereon. In 2001, while the sale was still pending, CCA and First Hyannis executed two agreements (collectively, 2001 agreements), the interpretation of which the parties have fiercely contested. The first was a development agreement (development agreement) wherein First Hyannis agreed, in separate paragraphs, to permit a reconfiguration of the BJ's entranceway and to permit a new roadway to be constructed on the land. In the paragraph regarding the new roadway, CCA agreed to compensate First Hyannis for any land delineated for the new roadway by providing replacement land. CCA and First Hyannis also executed a second agreement in which CCA agreed (1) to return $50,000 that First Hyannis had already paid to extend the closing date a first time and (2) to waive another $50,000 payment that First Hyannis would owe for extending the closing date a second time. The sale finally closed on April 13, 2004.
We have taken the facts from the parties' undisputed statement of facts and have supplemented those facts, where necessary, by other evidence in the summary judgment record construed in the light most favorable to the nonmoving party, First Hyannis. See Premier Capital, LLC v. KMZ, Inc., 464 Mass. 467, 474-475 (2013).
As there are no issues in this appeal regarding the distinction between First Hyannis and its predecessor in interest, we refer to both as First Hyannis for ease of reference.
The reconfigured entranceway and the new roadway would not have affected First Hyannis's plans for the BJ's but would have affected the size and location of the second retail building.
When the sale closed, First Hyannis commenced construction on the BJ's, but the size and location of the second retail building, as well as whether CCA would construct the new roadway, were still undetermined. CCA and First Hyannis thus executed an amended development agreement (amended development agreement) in which they agreed as follows: "With respect to paragraphs 1 and 2 of the [d]evelopment [a]greement, within one (1) year from the date hereof, First Hyannis may provide to CCA a sketch plan of where it intends to locate an additional building . . . . CCA shall have thirty (30) days from the date of delivery . . . to determine whether to approve the [p]lan." First Hyannis did not send CCA a sketch plan of where it intended to locate the second retail building until 2006, after the one-year period in the amended development agreement had elapsed. Because CCA never exercised the option to construct the new roadway, the sketch plan showed the BJ's entranceway in its original location, did not show the new roadway on the land, and thus also did not show any replacement land. CCA objected by letter, stating that the BJ's entranceway was too far to the east.
What First Hyannis did not know, at least initially, was that (1) CCA was meanwhile negotiating the sale of land south of Attucks Lane to Atlantis for Stop & Shop, which needed the BJ's entranceway positioned in a certain location to align with Stop & Shop's proposed entranceway, and (2) CCA objected to First Hyannis's sketch plan at the request of Atlantis and Stop & Shop. As stated in a March 7, 2006 e-mail (2006 e-mail) from Atlantis's counsel to CCA, "[I]f [First Hyannis's] proposal threatens the [Stop & Shop] development, Stop & Shop may not fund acquisitions. [Stop & Shop] suggests that [First Hyannis] must be persuaded that [First Hyannis] will not achieve [its] project if [it] prevents fruition of the [Stop & Shop] project." Atlantis's counsel attached a draft letter that CCA could send to First Hyannis, stating that the BJ's entranceway was too far to the east, which was substantially the same letter that CCA did send to First Hyannis objecting to the sketch plan.
On June 2, 2006, the sale of land from CCA to Atlantis closed, and CCA also assigned its interest in the development agreement, as amended, to Atlantis. Atlantis and Stop & Shop then took the position that the 2001 agreements between CCA and First Hyannis involved two different deals: (1) a deal to move the BJ's entranceway in exchange for returning and waiving First Hyannis's $50,000 payments to extend the closing date and (2) a deal whereby CCA could opt to build a new roadway on the land that CCA was selling to First Hyannis in exchange for providing replacement land. First Hyannis took the position that the entranceway and the new roadway were connected deals, that the consideration for both was the replacement land, and that First Hyannis thus had no obligation to move the entranceway since CCA never exercised the option to construct the new roadway. Over the next several years, while the parties attempted to resolve this dispute, First Hyannis learned that Stop & Shop needed the BJ's entranceway positioned in a certain location and that CCA was supporting Atlantis and Stop & Shop's interpretation of the 2001 agreements.
While First Hyannis was not immediately made aware of the assignment, Atlantis informed First Hyannis of the assignment no later than July 25, 2008, when Atlantis's counsel sent a letter to First Hyannis stating, "As you know, we represent Atlantis[,] . . . assignee of [CCA] of that certain [d]evelopment [a]greement . . . as amended by [the amended development agreement]."
According to First Hyannis, it agreed to move the BJ's entranceway to align with the new roadway; if CCA did not exercise the option to construct the new roadway, First Hyannis had no obligation to move the BJ's entranceway.
Because the parties were unable to resolve their dispute, Atlantis brought a lawsuit on March 9, 2009, in Barnstable Superior Court (Barnstable Superior Court action) seeking money damages and an order compelling First Hyannis to move the BJ's entranceway to align with Stop & Shop's entranceway. The Barnstable Superior Court action survived cross motions for summary judgment, with the motion judge concluding that the 2001 agreements were ambiguous. The motion judge relied, among other things, on the fact that the entranceway and the new roadway were addressed in separate paragraphs of the development agreement. The first day of trial, which commenced on October 15, 2012, Atlantis produced for the first time the 2006 e-mail in which Atlantis's counsel asked CCA to persuade First Hyannis to move the BJ's entranceway. At the conclusion of the trial, the jury returned a verdict for First Hyannis.
The Barnstable Superior Court action was first filed in the Land Court but then transferred to the Barnstable Superior Court.
Atlantis unsuccessfully argued that the 2006 e-mail was protected by the attorney-client privilege.
On July 25, 2012, Stop & Shop brought a companion case alleging that the 2001 agreements required First Hyannis to move the BJ's entranceway and sought to have the companion case consolidated with the Barnstable Superior Court action. The motion to consolidate was denied, and Stop & Shop's complaint was dismissed following the jury verdict in the Barnstable Superior Court action.
Meanwhile, while the Barnstable Superior Court action was ongoing, the Cape Cod Commission approved an application by First Hyannis to expand the size of the BJ's, which by then had been constructed, and Atlantis appealed that approval to the Land Court on October 18, 2011 (Land Court action). Atlantis alleged that the expansion uniquely impacted it as an abutter due to "increased traffic and congestion, decreased safety, substantial impairment of access[,] and diminution of property value." Following a two-day bench trial, the trial judge issued a twenty-four page decision addressing Atlantis's arguments and affirming the Cape Cod Commission's decision to approve First Hyannis's application.
Discussion. In this lawsuit, First Hyannis alleged that the defendants engaged in a decade-long scheme to deprive First Hyannis of its development opportunities. The alleged scheme among the defendants was the basis for First Hyannis's claim for tortious interference with contractual relations against Atlantis and Stop & Shop, as well as First Hyannis's claims for civil conspiracy and violation of G. L. c. 93A against all of the defendants. The primary issue on appeal is whether the statutes of limitations that apply to those claims had run by the time First Atlantis filed its complaint on October 9, 2015.
1. Statutes of limitations. The statute of limitations on tortious interference and civil conspiracy claims is three years, see G. L. c. 260, § 2A, and the statute of limitations for G. L. c. 93A claims is four years, see G. L. c. 260, § 5A. First Hyannis argues that it believed it was negotiating with the defendants over the interpretation of the 2001 agreements in good faith until it received the 2006 e-mail on October 15, 2012, that it could not have known of the defendants' alleged scheme before then, and that all of its claims were thus timely brought on October 9, 2015. The defendants argue that First Hyannis should have known that the defendants were working together to compel First Hyannis to move the BJ's entranceway no later than March 9, 2009, when Atlantis filed the Barnstable Superior Court action, and that all of First Hyannis's claims were thus untimely brought on October 9, 2015.
Both statutes of limitations began to run when First Hyannis knew or should have known that it had sustained appreciable harm. See Schwartz v. Travelers Indem. Co., 50 Mass. App. Ct. 672, 678 (2001). "What a plaintiff knew or should have known is a question of fact that is often unsuited for summary judgment. However, when the facts regarding discovery of harm are undisputed, the question may be decided as a matter of law" (quotation and citations omitted). Khatchatourian v. Encompass Ins. Co. of Mass., 78 Mass. App. Ct. 53, 57 (2010).
Contrary to First Hyannis's arguments, and as we explain more fully below, the defendants did not conceal that they were working together to compel First Hyannis to move the BJ's entranceway. There is thus no basis for us to conclude that the statutes of limitations did not begin to run until First Hyannis had actual knowledge of the harm. See Crocker v. Townsend Oil Co., 464 Mass. 1, 8-9 (2012).
First Hyannis should have known of the alleged scheme, and that the alleged scheme was preventing First Hyannis from proceeding with its development plans, no later than late 2008 or early 2009. By then, First Hyannis knew that Stop & Shop needed the BJ's entranceway positioned in a certain location to align with Stop & Shop's proposed entranceway and that CCA was helping Atlantis and Stop & Shop by, among other things, (1) disproving First Hyannis's sketch plan, (2) assigning CCA's rights under the development agreement to Atlantis, and (3) supporting Atlantis and Stop & Shop's interpretation of the 2001 agreements. In these circumstances, First Hyannis knew or should have known that CCA, Atlantis, and Stop & Shop were working together to compel First Hyannis to move the BJ's entranceway. If there was any doubt, the principal of First Hyannis testified at his deposition that he realized in late 2008 or early 2009 that CCA had changed its "story" to align with Atlantis and Stop & Shop's interpretation of the 2001 agreements. The 2006 e-mail thus simply confirmed what First Hyannis already knew or should have known.
We are unpersuaded by First Hyannis's argument that there was no appreciable harm until it prevailed in the prior lawsuits. First Hyannis alleged damages from the inability to develop its land dating back to 2006. While First Hyannis may not have known the full extent of the harm until it prevailed in the prior lawsuits, the statutes of limitations nonetheless began to run as soon as First Hyannis knew or should have known that it had sustained some appreciable harm. See, e.g., Frankston v. Denniston, 74 Mass. App. Ct. 366, 374 (2009).
The principal of First Hyannis, Morris Tarkinow, testified that he had this realization after a conversation with the principal of CCA, Samuel Lorusso, in which Tarkinow asked Lorusso what he was doing and Lorusso responded, "Gotta do what I gotta do."
First Hyannis argues that our inquiry should not end here, however, because the defendants continued to engage in injurious acts within four years of First Hyannis's October 9, 2015 complaint and that First Hyannis thus has a viable G. L. c. 93A claim. First Hyannis points to the Land Court action and Stop & Shop's companion case to the Barnstable Superior Court action (Barnstable Superior Court companion case), see note 9, supra. In addressing this argument, we will assume that the defendants intended to block First Hyannis's development plans and sought to accomplish that goal by filing all of the prior lawsuits. The defendants were nonetheless "justified" in doing so if they filed the prior lawsuits in "good faith effort[s] to assert legally protected rights." G.S. Enters., Inc. v. Falmouth Marine, Inc., 410 Mass. 262, 273 (1991) (addressing tortious interference claim but later concluding that same logic applied to c. 93A claim). See Rental Prop. Mgt. Servs. v. Hatcher, 479 Mass. 542, 552 n.9 (2018).
First Hyannis also argues that this conduct, which occurred within the limitations period, "rew[ound] the limitations period so that untimely acts . . . [could] be pursued as well" under the continuing violation doctrine. Because First Hyannis did not raise this issue below, it is waived. See, e.g., Weiler v. PortfolioScope, Inc., 469 Mass. 75, 86 (2014).
We turn to the two lawsuits that were filed within the statute of limitations. In the Land Court action, Atlantis asserted its legally protected right as an abutter to raise traffic concerns. While Atlantis did not prevail, there is nothing in the twenty-four page decision addressing Atlantis's arguments -- or anything else in the record -- from which we could infer that Atlantis's arguments were frivolous. In the Barnstable Superior Court companion case, Stop & Shop raised the same issue regarding the interpretation of the 2001 agreements -- agreements that a motion judge had already concluded were ambiguous -- that First Hyannis and Atlantis were then litigating in the Barnstable Superior Court action. As soon as First Hyannis prevailed in the Barnstable Superior Court action, the Barnstable Superior Court companion case was dismissed. In these circumstances, we conclude that neither the filing of the Land Court action nor the filing of the Barnstable Superior Court companion case may serve as the basis for a G. L. c. 93A claim as a matter of law. Contrast G.S. Enters., Inc., 410 Mass. at 273-275, 277.
G.S. Enterprises, Inc. (GSEI), brought tortious interference and G. L. c. 93A claims against Falmouth Marine, Inc. (FMI), based on FMI's prior unsuccessful lawsuit to enforce a contract. See G.S. Enters., Inc., 410 Mass. at 263-267. GSEI's claims survived summary judgment where there was evidence that FMI never had a good faith belief that a binding contract existed. See id. at 273-275, 277.
2. Motion to amend. Separately, First Hyannis argues that it should have been allowed to amend its complaint to add claims for abuse of process and malicious prosecution against Atlantis and Stop & Shop. We review the denial of First Hyannis's motion for leave to amend for abuse of discretion, and we discern none. See Minkina v. Frankl, 86 Mass. App. Ct. 282, 293-294 (2014). First Hyannis filed its motion for leave to amend on December 3, 2018, over three years after filing its complaint and after the parties had engaged in substantial discovery. At that time, the Atlantis and Stop & Shop were working on their motion for summary judgment, which was filed the following month. First Hyannis's delay in raising its abuse of process and malicious prosecution claims would have prejudiced Atlantis and Stop & Shop, which had already spent years directing their discovery and summary judgment efforts at First Hyannis's tortious interference, civil conspiracy, and G. L. c. 93A claims. In these circumstances, we see no abuse of discretion in the denial of First Hyannis's motion for leave to amend its complaint. See id.,
First Hyannis's motion for leave to amend sought only to add a claim for abuse of process; First Hyannis later suggested adding a claim for malicious prosecution in a reply memorandum.
Based on how we have decided this appeal, we need not address First Hyannis's arguments regarding its motion to compel discovery.
CCA's request for an award of appellate attorney's fees is denied, as First Hyannis's appeal is not frivolous. See Mass. R. A. P. 25, as appearing in 481 Mass. 1654 (2019).
Judgment affirmed.
By the Court (Meade, Kinder & Hand, JJ.),
The panelists are listed in order of seniority.
/s/
Clerk Entered: September 25, 2020.