Opinion
No. 12–P–2.
2012-11-21
Patricia MAVRIDES & another v. KK ASSOCIATES, INC., & others.
By the Court (MEADE, SIKORA & WOLOHOJIAN, JJ.).
MEMORANDUM AND ORDER PURSUANT TO RULE 1:28
After a jury-waived trial, a Superior Court judge held Salon Aristophani, Inc. (Salon Aristophani), vicariously liable for the acts of Patricia Mavrides (collectively, the plaintiffs), concluding that Mavrides acted as Salon Aristophani's agent when she brought and pursued a frivolous lawsuit against the defendants.
On appeal, the plaintiffs argue that (a) the judge erred in finding that Mavrides was acting as Salon Aristophani's agent when she brought and pursued the groundless suit,
The issues in this appeal relate to the defendants' abuse of process counterclaim.
(b) the award of damages was not reasonable, and (c) the judge abused his discretion when he awarded treble damages. For the reasons that follow, we affirm. Standard of review. We accept the trial judge's findings as true unless they are clearly erroneous. J.A. Sullivan Corp. v. Commonwealth, 397 Mass. 789, 792 (1986) (applying Mass.R.Civ.P. 52[a], as amended, 423 Mass. 1402 [1996] ). A finding is clearly erroneous only if our review of the entire record leaves us “with the definite and firm conviction that a mistake has been committed.” Ibid., quoting from United States v. United States Gypsum Co., 333 U.S. 364, 395 (1948). We also examine the judge's findings and rulings “to make sure that the conclusions are not inconsistent with legal standards.” Ibid.
Mavrides stipulated to individual liability for both the abuse of process and G.L. c. 93A claims.
Salon Aristophani's vicarious liability. A principal may be held vicariously liable for an agent's tortious acts if the acts were committed within the scope of the agency relationship. See Worcester Ins. Co. v. Fells Acres Day Sch., Inc., 408 Mass. 393, 404 (1990). Proof of the existence of an agency relationship is ordinarily a question of fact. Stern v. Lieberman, 307 Mass. 77, 80–81 (1940). An agency relationship “results from the manifestation of consent by one person to another that the other shall act on his behalf and subject to his control.” Kirkpatrick v. Boston Mut. Life Ins. Co., 393 Mass. 640, 645 (1985), quoting from Restatement (Second) of Agency § 1 (1958). In the context of a closely held corporation, such as here, the corporation may be liable for an agent's actions if the agent has “general control of the ordinary business of the corporation” and the “ostensible authority” to take those actions. Hartford v. Massachusetts Bowling Alleys, Inc., 229 Mass. 30, 32–33 (1918).
There was abundant evidence before the judge to support his determination that Mavrides brought and pursued the lawsuit as Salon Aristophani's agent. Among other things, the record demonstrated that (1) Mavrides was the president and majority (fifty-one percent) shareholder of Salon Aristophani, Mavrides's husband owned forty-seven percent of the corporation, and only two other shareholders owned the remaining two percent interest in the corporation
; (2) Mavrides signed both the original and amended verified complaints as president of Salon Aristophani
Mavrides testified that she was president of Salon Aristophani, that she and her husband owned the majority of the salon's shares, and that two other shareholders owned less than five percent.
; (3) Mavrides brought the lawsuit to protect the assets of Salon Aristophani
Mavrides identified herself in both verified complaints as “president/owner, Salon Aristophani Corporation d/b/a the Embellish Salon.” Furthermore, Mavrides acknowledged at trial that she brought suit to pursue Salon Aristophani's claims against the defendants.
; (4) Mavrides funded the lawsuit with money from Salon Aristophani
Mavrides testified that she filed suit against the defendants to protect the assets of Salon Aristophani. Kimberly Kett testified that Mavrides negotiated on Salon Aristophani's behalf to purchase Kett's salon and, following the purchase, that Mavrides asked Kett to convey that salon's earnings via checks made out to Salon Aristophani. Although Mavrides repeatedly sought to distinguish between Salon Aristophani and the salon she purchased from Kett, it was the judge's prerogative not to credit Mavrides's testimony that she believed that “Salon Aristophani” and “Salon Aristophani d/b/a Embellish” were two separate businesses. See, e.g., McNamee v. Jenkins, 52 Mass.App.Ct. 503, 506 (2001) (credibility questions are for trier of fact).
; and (5) Mavrides acknowledged in a separate United States Bankruptcy Court action that she brought the lawsuit, in part, on behalf of Salon Aristophani. When viewed in its totality, the evidence amply supported the judge's finding that Mavrides had general, ostensible authority to conduct Salon Aristophani's business and to bring the lawsuit on its behalf.
Mavrides admitted at trial that funding for the lawsuit came from Salon Aristophani.
Defendants' actual damages. The plaintiffs argue that the judge's assessment of damages (in the form of attorney's fees and costs) was unreasonable. This argument is waived. The plaintiffs did not dispute the reasonableness of the fees and costs incurred by the defendants in defending against the lawsuit. They did not examine any witnesses at trial regarding the amount of fees and costs expended, nor did they in any other manner alert the trial judge that they disputed the reasonableness of the defendants' fees and costs. The argument cannot be raised for the first time on appeal. See Century Fire & Marine Ins. Corp. v. Bank of New England–Bristol County, N.A., 405 Mass. 420, 421 n. 2 (1989) (issue not raised or argued below cannot be argued for first time on appeal).
Even were we to consider the merits of their argument, the plaintiffs would fare no better. The judge considered the nature of the case, the issues, the time and labor spent, and the results obtained, see Berman v. Linnane, 434 Mass. 301, 303 (2001), and his assessment was reasonable.
Treble damages. Lastly, the plaintiffs argue that the judge erred in trebling damages pursuant to G.L. c. 93A, § 11. In essence, they argue that because their claims survived summary judgment, their continued pursuit of them was not so egregious as to warrant treble damages. We review the judge's award for abuse of discretion, see Hug v. Gargano & Assocs., P.C., 76 Mass.App.Ct. 520, 528–529 (2010), and discern none here. The judge found that Mavrides knew or should have known that there was no factual or legal basis for her claims against the defendants, and that she had made serious factual misrepresentations to various judges throughout the proceedings upon which they had relied, including the false assertion that Connolly had executed a noncompete agreement. The judge found Mavrides's litigation conduct to be “egregious” and “reprehensible,” and found that she had “wrongfully obtained [an] injunction [so as] to misappropriate the power of this court to strangle a potential competitor in its infancy.” Apart from conclusory assertions, the plaintiffs have offered nothing to undercut this view of their conduct, and the judge's decision to award treble damages was well within his discretion given his factual findings.
Judgment affirmed.