Bronstein v. Prudential Ins. Co. of America

• Decision Date: 05 January 1984
• Citation: 390 Mass. 701,459 N.E.2d 772
• Parties: Frank BRONSTEIN et al. v. The PRUDENTIAL INSURANCE COMPANY OF AMERICA et al. (and a consolidated case 1 ).
• Court: United States State Supreme Judicial Court of Massachusetts Supreme Court

Page 772

459 N.E.2d 772

390 Mass. 701

Frank BRONSTEIN et al. v. The PRUDENTIAL INSURANCE COMPANY OF AMERICA et al. (and a consolidated case ¹).

Supreme Judicial Court of Massachusetts Suffolk.

Argued Oct. 6, 1983.

Decided Jan. 5, 1984.

Douglas G. Moxham, Boston (Judith Gail Dein and Herbert W. Vaughan, Boston, with him), for The Prudential Ins. Co. of America and others.

Saul A. Schapiro, Boston, for Frank Bronstein and others.

Before HENNESSEY, C.J., and LIACOS, ABRAMS, NOLAN and LYNCH, JJ.

NOLAN, Justice.

A judge of the United States District Court for the District of Massachusetts has certified two questions to this court pursuant to S.J.C. Rule 1:03, as amended, 382 Mass. 700 (1981). These questions concern the construction of G.L. c. 121A, § 18D, inserted by St.1975, c. 827, § 19, which regulates condominium conversion for the purpose of urban redevelopment in Massachusetts. The two questions pose issues of first impression. The facts which we set forth are taken from the order of certification which also contains the questions to be answered.

The plaintiffs in the consolidated class actions are tenants who reside in three rental apartment buildings owned by The Prudential Insurance Company of America (Prudential). These apartment buildings are located at the Prudential Center in Boston and they are called The Gloucester, The Boylston, and The Fairfield. The tenants are attempting to prevent Prudential from pursuing its plans to convert these apartment buildings to cooperative housing.

In 1962, the Boston Redevelopment Authority (BRA) and the mayor of Boston approved Prudential's application for the construction of the Prudential Center as part of an urban redevelopment project under G.L. c. 121A. In the proposal, Prudential reserved a future option to construct residential units within the project area. In 1965, the mayor and the BRA approved Prudential's plans to build three residential rental apartment buildings.

On April 12, 1982, Prudential proposed the creation of three cooperative corporations to which it would convey the three residential units. This proposal has yet to be approved by the BRA. In spite of the lack of approval, Prudential proceeded to act in accordance with its "resident conversion program."

First, Prudential notified all tenants of its plans to convert the three residential apartment buildings to cooperative ownership. Second, on various occasions Prudential outlined the three options available to each tenant. These options were purchase, relocation with a relocation allowance or continued occupancy for one year with a waiver of the relocation allowance. Finally, Prudential formally notified the tenants that their tenancies would be terminated upon the expiration of their current leases.

As a result of Prudential's actions, a class action was commenced in the Boston Housing Court seeking declaratory and injunctive relief against Prudential's proposed conversion, and against any steps, including the termination of leases, in furtherance of the Prudential proposal. The case was removed to the United States District Court for the District of Massachusetts.

Shortly after commencement of this action, Prudential notified those tenants not subject to rent control of an increase in rent. A separate action was initiated alleging that the rental increases were part of an illegal attempt to drive out the tenants in order to further Prudential's conversion plans. ²

Question One. Question one asks: "Does the provision of Massachusetts General Laws Chapter 121A, Section 18D, that states, 'No units of rental housing constructed as part of an approved project under this chapter may be converted to condominiums pursuant to this section,' (emphasis supplied) apply as well to conversion of rental housing to cooperatives ?" We answer this question in the negative.

The tenants argue that the statute should be read to include both condominiums and cooperatives. First, they assert that as a matter of linguistic analysis, modern condominiums and cooperatives are included within the use of the term "condominium." Through an oversimplified description of the general characteristics pertaining to each, ³ the tenants suggest that a condominium and a cooperative are the same for purposes of the statute. Alternatively, they contend that no substantive difference exists between cooperatives and condominiums for purposes of G.L. c. 121A, because, regardless of which method is chosen, the conversion must serve an identifiable public purpose. They argue that Prudential's conversion plan does not satisfy this criterion and therefore cannot be allowed.

These arguments misconstrue the basic tenets of statutory construction. The statutory language, when clear and unambiguous, must be given its ordinary meaning. Hashimi v. Kalil, 388 Mass. 607, 610, 446 N.E.2d 1387 (1983). When the use of the ordinary meaning of a term yields a workable result, there is no need to resort to extrinsic aids such as legislative history. Id. Moreover, the statutory language is the principal source of insight into legislative purpose. Hoffman v. Howmedica, Inc., 373 Mass. 32, 37, 364 N.E.2d 1215 (1977).

A housing "cooperative" connotes a multidwelling complex in which each owner acquires an interest in the entire complex and a proprietary lease to his own apartment. Black's Law Dictionary 302 (5th ed. 1979). A "condominium," on the other hand, describes "a single real property parcel with all the unit owners having a right in common to use the common elements, with separate ownership confined to the individual units." Black's Law Dictionary 267 (5th ed. 1979). A condominium therefore is a statutory creation, G.L. c. 183A, separate and distinct from a cooperative, G.L. c. 157, § 3A. This is clear from § 18D itself which specifies that the provisions of G.L. c. 183A, shall govern unless otherwise indicated. It is equally clear that G.L. c. 183A, does not govern cooperatives. The fact that each is governed by separate legislative enactments fortifies the conclusion that the word "condominium" does not include within its meaning the term "cooperative."

The tenants discuss at great length the evolution of G.L. c. 121A. As originally adopted, it was an attempt to eliminate substandard living conditions in urban areas by utilizing private capital to revitalize decaying urban areas. St.1945, c. 654, §§ 1 and 3. Although the legislature amended G.L. c. 121A in 1960 to include the construction of commercial, industrial, institutional, recreational or governmental buildings (St.1960, c. 652, § 1), the fundamental underpinning of the statute remained the same, i.e., that such projects be undertaken for a public purpose. See Opinion of the Justices, 341 Mass. 760, 776-777, 168 N.E.2d 858 (1960).

While we agree with the tenants' summary of the legislative history, we do not agree that we should include cooperatives within the ambit of G.L. c. 121A, § 18D, because Prudential's proposed conversion may not fulfil a public purpose. The tenants believe that the conversion cannot fulfil a public purpose because Prudential's plans arise from profit seeking motives. We conclude that the argument concerning the lack of public purpose should be directed to the BRA. The Legislature has provided specific standards by which the BRA is to determine whether a particular proposal will fulfil a public use and benefit. St.1960, c. 652, § 13. "Our inquiry is limited to ascertaining compliance with those standards." Boston Edison Co. v. Boston Redevelopment Auth., 374 Mass. 37, 62, 371 N.E.2d 728 (1977). Since the actual proposal is still pending before the BRA, our inquiry on this matter would be premature. The scope of judicial review of the BRA's actions includes correcting errors of law and applying the substantial evidence test to factual findings on public use and benefit, among other things. Id. at 46-48, 371 N.E.2d 728. See St.1960, c. 652, § 13. However, we do not have the authority initially to determine what constitutes a public purpose. Moreover, on review, we need not be concerned with the motives of the applicants under G.L. c. 121A. The purpose of the applicants in proposing the conversion is wholly irrelevant, if a project will eliminate substandard or decadent conditions.

Secondly, we find that when the word "condominium" is given its ordinary meaning within the statute, it yields a workable result. Therefore, even assuming that the tenants' policy arguments are directed to the correct forum, we need not resort to extrinsic aids such as legislative history. Hashimi v. Kalil, 388 Mass. 607, 610, 446 N.E.2d 1387 (1983). The precatory language of § 18D characterizes the creation of condominiums as an "additional means of development of property for the purposes of eliminating blighted, open, decadent or substandard conditions in certain areas." The Legislature could not have intended the inclusion of cooperatives as an "additional means of development," because cooperative ownership has been an accepted method of development pursuant to G.L. c. 121A, § 3, since the statute's enactment in 1945.

Furthermore, the terminology ⁴ used in § 18D specifically relates to condominium ownership and comports with the terminology used in G.L. c. 183A, which governs condominium ownership. This terminology is not easily transferable to the separate and distinct statutory creature, the housing cooperative. G.L. c. 157, § 3A. See Kostick v. Dupree, 10 Mass.App. 929, 412 N.E.2d 1275 (1980) (appropriate terminology includes "cooperative apartment" and "cooperative housing corporation"). For these reasons we decline to imply that the legislative policy requires that we include the term "cooperative" within G.L. c. 121A, § 18D. "[W]e have no right to conjecture what the Legislature would have enacted if they had foreseen the occurrence of a case like this; much less can we read into the statute a provision which the Legislature did not see fit to...