Aronson v. Brookline Rent Control Bd.

• Decision Date: 26 June 1985
• Citation: 477 N.E.2d 182,19 Mass.App.Ct. 700
• Parties: Leonard J. ARONSON 1 v. BROOKLINE RENT CONTROL BOARD.
• Court: Appeals Court of Massachusetts

Page 182

477 N.E.2d 182

19 Mass.App.Ct. 700

Leonard J. ARONSON ¹ v. BROOKLINE RENT CONTROL BOARD.

Appeals Court of Massachusetts,

Norfolk.

Argued Jan. 8, 1985.

Decided April 24, 1985.

Further Appellate Review Denied

June 26, 1985.

Anita E. Cohen, Cambridge (Leslie H. Rudnick, Boston, with her), for plaintiff.

Roger R. Lipson, Brookline, for defendant.

Before GREANEY, C.J., and KAPLAN and WARNER, JJ.

KAPLAN, Justice.

We hold, affirming a judgment of the Superior Court, that the Brookline rent control board (board) may reopen its adjudicatory proceedings, which had resulted in decisions permitting the plaintiff Aronson to sell his housing units as condominiums, in order to determine whether he procured those decisions by misrepresentation or fraud.

By force of a by-law of the town of Brookline, authorized by St.1970, c. 843, ² the board is empowered to regulate the removal of housing units from rental housing use for the purpose of condominium conversion. The effect of the provisions of town by-law 38 (see §§ 3[h] and 9A) and of the board's regulation 29 was, at the times here relevant, to condition such removal upon the owner's securing, as applicable, either a "removal permit" or an "exemption." With enumerated exceptions, ³ permits were granted in the exercise of the board's discretion, of which it is only necessary to say, for the purposes of the present case, that a preference was allowed (and generally accorded) to a purchaser who lived in the same building in a unit other than that which was the subject of the sale. ⁴ An exemption was available where the purchaser was an "existing tenant" (as defined) of the unit to be sold. ⁵

At dates between July, 1982, and April, 1983, the board granted the plaintiff Aronson, as owner, a permit with respect to one unit at 1080 Beacon Street, and exemptions covering eleven other units in the same building. It appears that the board made these decisions entirely, or at least in material part, on the basis of submissions by the plaintiff consisting of his testifying on oath and producing purchase and sale agreements.

By May 31, 1983, the board, evidently aided by a staff investigation, had come to suspect that there might have been misrepresentation or fraud in the plaintiff's submissions on which it had acted; and on that date it voted to reopen the removal hearings on all twelve units "in order to determine," as it stated in its notice to the plaintiff and others, "whether the subject units were, in fact, sold to existing tenants." By a board subpoena of June 23, 1983, the plaintiff was directed to appear on June 27 to give evidence on this matter ⁶ and produce various documents. The hearing was continued at the plaintiff's request to July 11.

On July 6, 1983, the plaintiff commenced the present action seeking, in substance, a declaration and an injunction forbidding the board to reopen its proceedings. After the board filed its answer, the plaintiff moved for summary judgment on the pleadings. The judge denied the motion; and, upon the pleadings with their annexed exhibits, and after "trial" consisting of statements and arguments of counsel which supplied some additional material, the judge made findings, rulings, and an order for judgment. The essential facts, as outlined above, may be drawn from the findings with some references to the record. Judgment entered on January 18, 1984, "grant[ing] authority" to the board (more properly, confirming the board's authority) "to re-open its 'removal hearings' with respect to the housing units ... for the sole purpose of determining whether or not fraud or misrepresentation was perpetrated upon the board in the granting of removal permits or exemptions...." This judgment is here on review, and, with it, a previous protective order in the action allowing the board's motion to strike the plaintiff's interrogatories. ⁷

1. While the plaintiff challenges the "jurisdiction" of the board to reopen its hearings, there is a more immediate question of the authority of the Superior Court to entertain the present action. By St.1970, c. 843, § 4, the State Administrative Procedure Act, G.L. c. 30A, is made applicable to the board "as if said rent board were an agency of the commonwealth," including expressly "those provisions relating to judicial review of an agency order." By § 14 of c. 30 A, as inserted by St.1973, c. 1114, § 3, it is "any person ... aggrieved by a final decision of any agency in an adjudicatory proceeding" who "shall be entitled to a judicial review thereof." But there has been no final agency decision in these adjudicatory proceedings; it is the purpose of the action to interdict such a decision. This would seem to deprive the plaintiff of "standing" to maintain the action or, otherwise stated, to oust the Superior Court. See Duato v. Commissioner of Pub. Welfare, 359 Mass. 635, 637-638, 270 N.E.2d 782 (1971); Group Ins. Commn. v. Labor Relations Commn., 381 Mass. 199, 202 & n. 3, 408 N.E.2d 851 (1980); Boston Edison Co. v. Brookline Realty & Inv. Corp., 10 Mass.App. 63, 66, 405 N.E.2d 995 (1980).

Nevertheless, within cautious limits, an original action may lie to test whether an agency has exceeded its powers or "jurisdiction" or is aiming to do so, and to this extent the "final decision" or "exhaustion" principle may be pushed aside. Caution is indeed called for, as the history of administrative law shows, because attacks, mounted ostensibly under the banner of "jurisdiction," have on occasion been used to delay, if not to abort, legitimate agency undertakings. Decisions in this Commonwealth have allowed the rather anomalous original action in some situations where there was a credible claim that an agency was going beyond its bounds, the question appeared to be a general one whose settlement might be of value to many in addition to the immediate parties, and the case involved no or little fact finding (as where it reduced to statutory interpretation on agreed facts). See Massachusetts Bay Transp. Authy. v. Labor Relations Commn., 356 Mass. 563, 564-565, 254 N.E.2d 404 (1970); East Chop Tennis Club v. Massachusetts Commn. against Discrimination, 364 Mass. 444, 450-452, 305 N.E.2d 507 (1973), and cases cited; Lahey Clinic Foundation, Inc. v. Health Facilities Appeals Bd., 376 Mass. 359, 369, 380 N.E.2d 675 (1978). Cf. Murphy v. Administrator of the Div. of Personnel Admn., 377 Mass. 217, 220-222, 386 N.E.2d 211 (1979). Although we have misgivings whether the present claim can be ranked as credible, we cannot say that the judge committed error in entertaining the action.

2. There is no express provision for reconsideration of a board decision in the statute, by-law, or regulation, nor is there any provision on this matter in c. 30A. ⁸ Yet, where the board by statute, by-law, and its own regulation has expansive regulatory responsibility over a subject, with considerable leeway regarding substance and procedure, ⁹ and where, moreover, it deals on an adjudicatory basis with many ex parte applications requiring prompt action, the possibilities of misprisions are so obvious that a power to take corrective steps after decision would seem necessary and therefore implicit; and especially so, for instances where fraud or other overreaching is suspected. ¹⁰

To be sharply distinguished are questions of agency power to reconsider an adjudicatory decision in order to apply fresh judgment or an altered substantive policy to an otherwise closed proceeding. Such are the cases on which the plaintiff seeks to rely. ¹¹ We deal here with a supposed imposition on the board that would result in a tainted decision.

It is not in the least astonishing that courts have found many times that a power to reopen proceedings on grounds of fraud is inherent in the administrative process and needs no specific authorization by statute or regulation. See Baggett Transp. Co. v. United States, 206 F.Supp. 835, 842 (N.D.Ala.1962); Redding v. County Commrs. for Prince George's County, 263 Md. 94, 111, 282 A.2d 136 (1971); Anchor Cas. Co. v. Bongards Co-op. Creamery Assn., 253 Minn. 101, 104-107, 91 N.W.2d 122 (1958); Hall v. Seattle, 24 Wash.App. 357, 361-363, 602 P.2d 366 (1979). ¹² Other decisions look to some authorization for the reopening of final agency action, but tend to make an exception for fraud or to read vague, liberal grants of adjudicatory power to include inferentially the authority to reopen on account of error. See Kephart v. Wilson, 219 F.Supp. 801, 823-828 (W.D.Tex.1963), aff'd on other grounds, 350 F.2d 669 (5th Cir.1965); Modine Mfg. Co. v. Pollution Control Bd., 40 Ill.App.3d 498, 501, 351 N.E.2d 875 (1976). ¹³ Professor Davis appears to assume that the absence of express authorization for reopening administrative proceedings does not preclude it; on that basis he has identified the factors that agencies ought to consider in deciding in given situations whether they should, upon reopening, undo earlier decisions. Two of the factors mentioned are of interest also on the anterior question of the power to reopen: "the degree of care or haste in making the earlier decision, and the general equities of each problem." Davis, Administrative Law Text § 18.09, at 370 (3d ed. 1972). ¹⁴ As noted, under the practice indicated by the present record, the board, possibly for reasons of expedition, acted altogether or mainly on the faith of the presentation made by the owner, without--so far as appears--any serious independent check. That argues for a right to take a backward look, and the equities in cases of fraud argue to the same conclusion. ¹⁵ We add, as a final consideration, that if courts with their elaborate formal procedures require an avenue for "relief from judgment or order," among other reasons for "fraud ..., misrepresentation, or other misconduct of an adverse party" (see Mass.R.Civ.P. 60[b], 365 Mass. 828 [1974] ), administrative agencies with their generally looser, less stringent procedures need such...