Amerada Hess Corp. v. Garabedian

• Decision Date: 13 August 1993
• Citation: 416 Mass. 149,617 N.E.2d 630
• Parties: AMERADA HESS CORPORATION v. Mitchell GARABEDIAN. 1 AMERADA HESS CORP. v. GARABEDIAN.
• Court: United States State Supreme Judicial Court of Massachusetts Supreme Court

Page 630

617 N.E.2d 630

416 Mass. 149

AMERADA HESS CORPORATION v. Mitchell GARABEDIAN. ¹

AMERADA HESS CORP. v. GARABEDIAN.

Supreme Judicial Court of Massachusetts Hampden.

Argued April 5, 1993.

Decided Aug. 13, 1993.

William H. Gordon, Boston, for defendant.

Kevin C. Maynard, Springfield (Francis D. Dibble, Jr., with him) for plaintiff.

Before LIACOS, C.J., and WILKINS, LYNCH, O'CONNOR and GREANEY, JJ.

O'CONNOR, Justice.

The plaintiff corporation (Amerada) seeks specific performance of an agreement to sell real estate following its exercise of an option to purchase contained in a written lease of which it is successor lessee and the defendant (Garabedian), as trustee of Vestt Realty Trust, is successor lessor. In response to Amerada's complaint, Garabedian first filed a motion to dismiss for improper venue or, in the alternative, to remove the action to Essex County. After that motion was denied, Garabedian filed an answer to the complaint and a counterclaim containing eight counts. The counterclaim made numerous allegations, including allegations of the release or threats of release of oil or hazardous material onto the leased premises, violation of the lease requirement that the tenant comply with the law and authorized government directives, and unfair retaliation by Amerada for Garabedian's attempts to fulfil his obligations under G.L. c. 21E (1992 ed.). Garabedian then filed a motion "to assign action to proper track designation, or in the alternative, extend the time to conduct discovery by fourteen months." That motion was denied.

Thereafter, Amerada moved for summary judgment as to its claim seeking specific performance and as to the several claims made by Garabedian in the counterclaim. A judge allowed Amerada's motion and ordered Garabedian, in his individual capacity and as a trustee of Vestt Realty Trust "to deliver or cause to be delivered to [Amerada] ... (a) a complete abstract of title or other evidence of title satisfactory to [Amerada] of the premises ... (b) an up-to-date survey ... of the said premises ... and upon tender by [Amerada] of the purchase price of $174,000.00 within thirty (30) days thereafter; (c) a good and sufficient warranty deed...." The judge "further ordered and adjudged that summary judgment be entered on the counterclaim for [Amerada], dismissing the counterclaim in the entirety." Garabedian filed a motion for relief from judgment pursuant to Mass.R.Civ.P. 60(b), 365 Mass. 828 (1974), and that motion was denied. Garabedian appealed from the denial of his several motions and the allowance of Amerada's motion for summary judgment. We transferred the case to this court on our own initiative. We affirm.

We discuss the challenged rulings in the order in which they were made, the first ruling being the denial of Garabedian's motion to dismiss or transfer due to improper venue. The action was commenced in the Superior Court in Hampden County, which is the county where Amerada maintained its usual place of business. Garabedian mistakenly characterizes this action as a local action based on "privity of estate," the proper venue of which is the county where the real property is located. However, the plaintiff seeks an order of specific performance under a contract, and therefore, for purposes of venue, the action is transitory, not local. "An action based on fraud, trust, or contract is transitory, although lands not within the jurisdiction of the court may be affected by the decree. Within this principle are suits for specific performance of contracts, even though the subject of the contract is real property." First Fed. Sav. & Loan Ass'n v. Merrimack Valley Nat'l Bank, 5 Mass.App.Ct. 320, 323, 362 N.E.2d 939 (1977) quoting 1 Moore's Federal Practice § 0.142 [2.1], at 1367 (2d ed. 1976). As a transitory action, the action was properly brought in Hampden County where the plaintiff maintained its usual place of business, pursuant to the general venue provisions of G.L. c. 223, § 8 (1992 ed.).

The second ruling from which Garabedian appeals is the denial of his motion to assign the case to a different track designation or extend the period allowed for discovery by fourteen months. That motion was filed ten months after the complaint was filed, and requested that the track designation be changed from a fast (F) track case to an average (A) track case. The judge acted within his discretion in denying the motion and, in addition, no unfair prejudice has been shown.

Based on the pleadings, a deposition of Garabedian, and answers to interrogatories of both parties, the judge who ruled on Amerada's summary judgment motion concluded that the following facts appeared to be undisputed. We quote from the judge's memorandum of decision. "The premises that are the subject of this controversy consist of a parcel of land with the buildings and other improvements thereon located at 490 Broadway (Route 28) in the City of Methuen." On May 12, 1965, the then owner of the premises, E & W Realty, Inc., leased the premises to Hess Oil and Chemical Corporation for use as a gasoline service station. The term of the lease was to begin [ninety] days after the lessor delivered certain licenses and permits to the lessee and was to run for a period of [twenty] years, but the tenant was given two options to renew the lease for two additional periods of [five] years each by the giving of appropriate notices at least [sixty] days prior to the expiration of the then current term. The plaintiff is a successor in interest to Hess Oil and Chemical Corporation as a result of a merger between that corporation and Amerada Petroleum Corporation in 1969.

"Article 28 of the lease provides as follows:

'Lessor hereby grants to Tenant the exclusive right, at Tenant's option to purchase the demised premises, together with all structures, improvements, and equipment thereon, free and clear of all liens, and encumbrances (including leases which were not on the premises at the date of this lease), at any time during the original or renewal term of this lease for one hundred and seventy-four thousand ($174,000) dollars, or to make such purchase on the same terms and at the same price as any bona fide offer for said premises received by Lessor and which offer Lessor desires to accept. Upon receipt of a bona fide offer, and each time any such offer is received, Lessor shall immediately notify Tenant in writing of the full details of such offer, including the name and address of the offeror, whereupon tenant shall have thirty (30) days after receipt of such offer in which to elect to exercise Tenant's prior right to purchase, by written notice to Lessor. No sale of or transfer of title to said premises shall be binding on Tenant unless and until the foregoing requirements are fully complied with. If tenant elects to exercise its standing right to purchase, or its prior right to purchase pursuant to any such bona fide offer, it is agreed that the terms and conditions set forth in the last paragraph hereof shall govern such purchase. Such option shall be pre-emptive and continuing, and shall be binding upon Lessor, Lessor's heirs, devisees, legal representatives, successors and assigns.' (Emphasis supplied).

"Article 28 then goes on to provide the procedure that is to be followed by the parties upon receipt by the Lessor of a Tenant's notice of election to exercise the option.

"Article 23 of the lease provides as follows:

'The failure of the Lessor or Tenant to insist upon strict performance of any of the covenants or conditions of this lease or to exercise any...