DISCOVER REALTY CORPORATION v. David, 98-P-357.
| Decision Date | 11 April 2000 |
| Docket Number | No. 98-P-357.,98-P-357. |
| Citation | 49 Mass. App. Ct. 535,731 NE 2d 79 |
| Parties | DISCOVER REALTY CORPORATION v. STEPHEN T. DAVID, trustee. |
| Court | Appeals Court of Massachusetts |
Present: BROWN, GREENBERG, & GELINAS, JJ.
Gregory M. Doyle for the plaintiff.
Barry S. Scheer for the defendant.
The only issue properly before us concerns the propriety of the judge's conclusion that the seller's conduct did not rise to the level of a G. L. c. 93A violation.2
On February 25, 1995, the seller (David) granted to the broker (Discover) an exclusive right to sell Lot 1 on Sampson Circle (also known as Sprague Street) in Dedham.3 At the time, a paper street known as Hemlock Street abutted Lot 1 along its entire back length. When the seller entered into the listing agreement with the broker, he represented that he had obtained releases from the three abutting property owners of their rights in Hemlock Street. In fact, this representation was false. Of the three abutters to Hemlock Street, only two had agreed to release their rights and the seller was "in the process of obtaining" the third release.4 In marketing the property, the broker relied upon this false representation.
On April 21, 1995, the broker produced the DeChristofaros, buyers who were ready, willing, and able to purchase Lot 1 at a price (the full asking price) and terms agreeable to the seller.5 On the same day, the seller and the DeChristofaros entered into a purchase and sale agreement in which the seller agreed to pay the broker a commission of $11,250, which was five percent of the sales price.
In paragraph 43 of the purchase and sale agreement, the seller, who was an experienced real estate attorney, warranted and represented that "releases have been received from any abutters having rights in [Hemlock] street and that ... any releases have been recorded with the Norfolk County Registry of Deeds."
The seller, who did not have the three releases "in hand," subsequently ignored a number of requests from the DeChristofaros' attorney to produce copies of the documents allegedly recorded at the registry of deeds. Unable to perform, the seller defaulted and returned the DeChristofaros' deposit. The seller refused to pay the broker's commission for procuring the DeChristofaros. In the fall of 1995, the broker sold Lot 1 to different buyers and received a "proportional commission" for its role in co-brokering the sale.6
Based upon these subsidiary findings, the judge found that the seller had engaged in "wrongful conduct" by misrepresenting the status of the three releases to the broker at the time the listing agreement was executed and at the time the purchase and sale agreement was entered into, and that that misrepresentation had prevented the closing of the DeChristoforo sale. Therefore, she concluded, the broker came within the exception to the Tristram's Landing rule (Tristram's Landing, Inc. v. Wait, 367 Mass. 622, 627 [1975]
) requiring that a sale be actually consummated for a commission to be due, and was entitled to the commission specified in the listing agreement. See Hillis v. Lake, 421 Mass. 537, 545-546 (1995) ().7
The judge went on, however, to conclude that the seller's misrepresentation, upon which the broker's c. 93A claim was premised, did not descend to the level of an unfair and deceptive act or practice within the meaning of G. L. c. 93A, § 2(a), because she found that the elusive third release was unnecessary to sell Lot 1 as a marketable title.8 The findings, as they now stand on the record before us, are sketchy and ambivalent and do not support that result.
First, the judge's c. 93A analysis is devoid of any reference to or acknowledgment of her earlier findings concerning the seller's "false representation" of fact, his "wrongful conduct," and the broker's reliance upon the seller's misrepresentation in marketing the property and inducing the DeChristofaros to enter the purchase and sales agreement. Those subsidiary findings conflict with the judge's conclusion that the seller's conduct was not unfair or deceptive. Compare VMark Software, Inc. v. EMC Corp., 37 Mass. App. Ct. 610, 616-619 (1994).
Second, the judge's finding that the third release was "not necessary in order to sell Lot 1 with clean title," if read as a finding that the seller's false representation was immaterial, does not comport with her earlier finding that the same misrepresentation prevented the DeChristofaro sale from closing, thereby entitling the broker to a commission. To the extent that the language is read as a finding that the broker suffered no detriment from the seller's misrepresentation, that conclusion is contradicted by her earlier ruling and finding that the broker was entitled to a full commission of $11,250 with respect to the DeChristofaro transaction.9
The reasons the judge concluded that the seller's misrepresentation did not constitute a c. 93A violation were ultimately left unexplained in her decision. Compare Heller Financial v. Insurance Co. of N. America, 410 Mass. 400, 409 (1991); Shawmut Community Bank, N.A. v. Zagami, 30 Mass. App. Ct. 371, 375-377 (1991), S.C., 411 Mass. 807 (1992). We appreciate that "not every unlawful act is automatically an unfair (or deceptive) one under G. L. c. 93A." Mechanics Natl. Bank v. Killeen, 377 Mass. 100, 109 (1979). Levings v. Forbes & Wallace, Inc., 8 Mass. App. Ct. 498, 504 (1979). However, if...
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