Madan v. Royal Indem. Co.

• Decision Date: 18 January 1989
• Docket Number: No. 87-268,87-268
• Citation: 532 N.E.2d 1214,26 Mass.App.Ct. 756
• Parties: Anil MADAN v. ROYAL INDEMNITY COMPANY
• Court: Appeals Court of Massachusetts

Page 1214

532 N.E.2d 1214

26 Mass.App.Ct. 756

Anil MADAN v. ROYAL INDEMNITY COMPANY

No. 87-268.

Appeals Court of Massachusetts Suffolk.

Argued Jan. 13, 1988.

Decided Jan. 18, 1989.

Nathaniel M. Gorton, Michael K. Barron, Boston, with him, for defendant.

Jeffrey B. Storer, Boston, for plaintiff.

Before DREBEN, KASS and SMITH, JJ.

SMITH, Justice.

Anil Madan, the plaintiff, an attorney, filed a complaint in the Superior Court, claiming that the defendant, Royal Indemnity Company, had committed a breach of an agreement to lease certain premises to him. ¹ He also claimed, among other things, that the defendant had engaged in an unfair or deceptive act or practice, in violation of G.L. c. 93A, §§ 2(a ) and 11. The complaint sought specific performance and damages, both for the breaking of the agreement and for the alleged c. 93A violation. In its answer, the defendant denied that there was any agreement and also pleaded the Statute of Frauds. It also denied any violation of c. 93A. In addition, it filed a counterclaim for damages claiming that the plaintiff had unreasonably caused the filing of a notice of lis pendens on its property.

The plaintiff waived his claim for specific performance and the complaint, including the c. 93A action, was tried before a judge sitting with a jury. ² At the close of the plaintiff's case, the defendant moved for a directed verdict on that part of the complaint alleging that it had committed a breach of an agreement to lease. The defendant claimed, among other things, that the plaintiff had failed to produce any writing sufficient to satisfy the Statute of Frauds. The judge agreed with the defendant that a sufficient writing had not been introduced in evidence but denied the motion, ruling that the plaintiff had produced sufficient evidence for the jury to consider whether the defendant was estopped from claiming the Statute of Frauds as a defense. ³

At the conclusion of the trial, the judge submitted special questions to the jury. Mass.R.Civ.P. 49(a), 365 Mass. 812 (1974). The questions were divided into three groups, reflecting the pleadings and evidence in the case: (1) the agreement to lease claim, (2) the unfair or deceptive acts claim, and (3) the counterclaim. In their response to the questions, the jury found that (1) the parties had made an agreement to lease office space but that the plaintiff had not "avoided" the defense of the Statute of Frauds, (2) the defendant had committed unfair or deceptive acts, but had not done so in a wilful or knowing manner, and (3) the plaintiff had unreasonably filed a notice of lis pendens but that the defendant had not suffered any damages. The jury awarded $300,000 to the plaintiff because of the violation of c. 93A by the defendant.

After the verdicts were entered the parties filed various motions. The judge denied the defendant's motions for judgment notwithstanding the verdicts and for a new trial. However, because of the jury's finding that the plaintiff had not avoided the Statute of Frauds, the judge ordered judgment to enter for the defendant on the claim that it committed a breach of an agreement to lease office space. The judge allowed the plaintiff's motion for entry of judgment notwithstanding the verdict as to the defendant's counterclaim but denied the plaintiff's motions (1) to reopen the evidence on the c. 93A claim to introduce the plaintiffs' demand letter, (2) for an additur to the actual damages, and (3) for judgment in his favor on his claim that the defendant's conduct was wilful and knowing. The judge awarded to the plaintiff $56,367.20 in attorney's fees. On appeal, the defendant claims that the judge erred in (1) denying its posttrial motions, (2) granting judgment for the plaintiff on the defendant's counterclaim, and (3) awarding of attorney's fees in the amount of $56,367.20 pursuant to c. 93A, § 11. The plaintiff in a cross appeal, claims that the judge erred in denying his posttrial motions.

I. The Defendant's Issues.

A. Denial of the motion for judgment notwithstanding the verdict. The defendant claims that the evidence did not warrant a finding that the defendant's conduct amounted to a violation of c. 93A and, therefore, the judge erred in denying its motion for a judgment notwithstanding the verdict.

In reviewing the denial of a motion for judgment notwithstanding the verdict, the standard is "whether 'anywhere in the evidence, from whatever source derived, any combination of circumstances could be found from which a reasonable inference could be drawn in favor of the plaintiff.' " Poirier v. Plymouth, 374 Mass. 206, 212, 372 N.E.2d 212 (1978), quoting from Raunela v. Hertz Corp., 361 Mass. 341, 343, 280 N.E.2d 179 (1972). O'Shaughnessy v. Besse, 7 Mass.App.Ct. 727, 729, 389 N.E.2d 1049 (1979). ⁴ "In applying this standard, we examine the evidence in the light most favorable to the plaintiff." Forlano v. Hughes, 393 Mass. 502, 504, 471 N.E.2d 1315 (1984).

We summarize the evidence. In 1975, the plaintiff and his wife established a law practice in Boston. By 1980, the firm had grown and, consequently, the plaintiff started to look for more space. At that time the defendant had vacant space on the fifth floor at 25 New Chardon Street, space it had leased since 1966. The defendant hired one Boyle, a real estate broker, to find a subtenant and designated Brian Higgins, the administrative manager of its Boston office, to coordinate the effort to sublease the premises.

Boyle placed an advertisement in Massachusetts Lawyers Weekly that announced that "[a]pproximately 8,500 square feet of prime, useable space in a first-class building" was available for lease. The advertisement also stated that "[e]ight year lease available, $9.50 per sq. foot as is. Owner will improve to suit and factor improvements into rent over 8 year period...."

The plaintiff saw the advertisement on July 14, 1980. On July 16, he and his wife met with Boyle and Higgins and visited the premises. Upon their inspection, it was obvious to them that substantial renovations were needed in order to make the space suitable for a law firm. The plaintiff asked Higgins if the defendant would pay for the renovation costs but Higgins refused and stated that the costs would be factored into the rent. The plaintiff and his wife left and stated that they would get back to Boyle if they were interested.

The plaintiff and his wife visited the property again on July 28. While there they went over the details of the defendant's offer with Boyle and Higgins. The details of the offer were as follows: the plaintiff would lease from the defendant between 7500 and 8000 square feet and the term would be to the end of the defendant's lease; the rent would be $9.50 per square foot (including utilities but with escalation for taxes); the defendant would pay for a space designer to be chosen by the plaintiff and amortize the design and construction costs over the eight-year period; and the boilerplate of the plaintiff's lease would be the same as that of the defendant's lease, which was a standard one.

Later the same day, Boyle telephoned the plaintiff to press him to take the space. The plaintiff told Boyle that, "We have a deal. I will take the space." Boyle asked for a letter which the plaintiff sent to Higgins. In the letter, the plaintiff wrote that the square foot rental price and the eight-year term were acceptable to him. He also acknowledged his understanding that the defendant would "amortize" the cost of the improvements to the premises over the eight-year term of the lease. ⁵ After he wrote the letter, the plaintiff stopped looking for new quarters, and Boyle thereafter did not show the space to anyone else.

The plaintiff proceeded to engage one Bennett to design and prepare the construction documents for the renovations to the space. After he had prepared a preliminary plan he gave it to the plaintiff who, in turn, gave it to Higgins to forward to New York for the defendant's approval. Later Bennett produced a revised preliminary plan and Higgins informed him that the defendant had approved the plan and that Bennett should go ahead and prepare construction drawings.

On October 17, 1980, Boyle, at Higgins's request, telephoned the plaintiff and told him that the defendant wanted to know how much "up-front" money the plaintiff would pay toward the construction costs. The plaintiff stated that the payment of "up-front" money was not part of the agreement and refused to advance any money toward the costs of the improvements.

The preparation of the final construction plans and estimate were delayed because of lack of cooperation by the defendant's landlord. Frustrated, the plaintiff complained to Higgins and Boyle that no progress was being made and that his law firm was cramped in its quarters. On February 3, 1981, the plaintiff met with Higgins and Boyle and asked them if they were trying to "wreck" the deal. They both reassured him that they still had a deal and that they would take care of the landlord.

Bennett submitted the final architectural and engineering plans to Higgins who sent them to the defendant. The renovation project was then put out to bid. Shortly after a bid of $122,636 (not including carpeting) was received by the defendant, Boyle telephoned the plaintiff and again asked him how much money he would advance toward the construction costs. The plaintiff responded again that "up-front" money was not part of their agreement. Boyle then informed him that the defendant intended to charge interest on the construction cost reimbursements. The plaintiff protested that such interest charges also were not part of the agreement.

As a result of these developments, the plaintiff met with representatives of the defendant on April 30 to discuss the situation. He was informed by them that the defendant did not consider that the parties had an agreement but rather that the parties were still in the negotiating stage. The...