63 Mass.App.Ct. 229 (2005), 03-P-950, WHTR Real Estate Ltd. Partnership v. Venture Distributing, Inc.

Docket Nº:03-P-950
Citation:63 Mass.App.Ct. 229, 825 N.E.2d 105
Party Name:WHTR REAL ESTATE LIMITED PARTNERSHIP [ 1] v. VENTURE DISTRIBUTING, INC., [ 2] & another. [ 3]
Case Date:April 12, 2005
Court:Appeals Court of Massachusetts

Page 229

63 Mass.App.Ct. 229 (2005)

825 N.E.2d 105

WHTR REAL ESTATE LIMITED PARTNERSHIP 1

v.

VENTURE DISTRIBUTING, INC., 2 & another. 3

No. 03-P-950

Appeals Court of Massachusetts, Essex.

April 12, 2005

Heard: October 15, 2004.

Civil action commenced in the Superior Court Department on April 18, 1997. The case was heard by Barbara J. Rouse, J., and a motion for attorney's fees and costs was also heard by her.

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Richard C. Pedone (Victor G. Milione with him) for the plaintiff.

Kevin F. Moloney (Roger T. Manwaring with him) for the defendants.

Perretta, Doerfer, & Mills, JJ.

MILLS, J.

After a jury-waived trial, a Superior Court judge made findings and ruled that the defendant tenant, Venture Distributing, Inc. (the tenant), had breached its commercial lease with the plaintiff landlord, WHTR Real Estate Limited Partnership (the landlord), by failing to pay rent. The judge ordered judgment in favor of the landlord in the amount of $281,669.03, and awarded attorney's fees, in the amount of $140,000, and costs of $7,500 to the landlord. The tenant's two counterclaims, alleging that the landlord had breached the lease by unreasonably withholding consent to a sublease with a potential subtenant and that the landlord had scuttled negotiations between the tenant and potential subtenant, in violation of G.L. c. 93A, were dismissed. 4 Both parties appeal. The tenant argues that the judge applied an incorrect legal standard in her rulings, improperly struck evidence that had been admitted de bene, and made erroneous subsidiary findings of fact. The landlord claims that the judge abused her discretion by failing to award the full sum of attorney's fees that the landlord had requested. We affirm.

1. Background.

The judge made thirty-five paragraphs of careful findings, narrating the six-week course of dealing among the landlord, tenant, and a potential subtenant. The tenant leased commercial space in Woburn (the Woburn space) from the landlord. To cut costs the tenant decided to relocate and hired a broker (Levine) to find a subtenant. Levine contacted USCO Distribution Services, Inc. (USCO), which was seeking to lease new space and, on or about March 15, 1996, sent a letter of intent for a sublease of the Woburn space between the tenant and USCO, "as is." USCO did not accept the tenant's offer. Instead, it made a counteroffer, with added conditions, on March 19, 1996.

The tenant did not respond to USCO's March 19, 1996,

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counteroffer. On March 22, 1996, the tenant's lawyer (Bennett), without addressing the conditions in the counterproposal, prepared a draft sublease and forwarded it to USCO's in-house counsel. That lease was never forwarded to USCO's executive officer (Sauder), who had primary responsibility for finding the needed new space. Also on March 22, 1996, the tenant's executive officer (Gack), without discussing with USCO its counterproposal or the proposed sublease, forwarded a copy of that sublease to the landlord with the notation: "Please examine sublease and sign consent if agreeable. Have you made any progress on 21E study? Please call me if I can be of any help." 5

Shortly thereafter, the landlord requested that Gack furnish a financial statement on USCO, as well as other information. In response, Gack obtained a Dunn & Bradstreet report, but did not forward it to the landlord until April 12, 1996. Other information requests from the landlord to the tenant went unanswered. Throughout the time that the tenant was negotiating with USCO, USCO was actively negotiating for other space, from a different owner, in Chelmsford (the Chelmsford space). Those negotiations included a rapid and active exchange of multiple documents and drafts.

On March 26, 1996, USCO conducted a "walk-through" of the Woburn space, and thereafter USCO's Sauder prepared a list of seventeen items that "need repair/testing prior to [USCO] signing a lease." The list was sent to the tenant's broker the next day, but the tenant did not receive it until April 11, 1996. USCO and the tenant never reached agreement with respect to the listed items or several other items identified in the documents exchanged between them.

Beginning in early April, the pace of negotiations between USCO and the Chelmsford owner picked up, and on April 15, 1996, USCO's broker informed USCO's counsel that USCO's counterproposal to the Chelmsford owner had been accepted. On April 29, 1996, USCO entered into a lease for the Chelmsford space.

Other aspects of the negotiations and communications between the landlord and tenant are narrated by the judge in her

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findings. Responses by the tenant to information and document requests from the landlord with respect to the proposed subtenancy were slow or nonexistent. The tenant was less than diligent in its attention to detail. The tenant never completely addressed the counterproposal items enumerated by USCO to the tenant on March 19, and the sublease prepared by the tenant was done without the necessary consultation with USCO or the landlord, or attention to other items noted by USCO as conditions to a sublease. A sublease proposed by USCO and sent to the landlord on April 17, 1996, contained several unresolved issues.

A sublease...

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