Pappas Indus. Parks, Inc. v. Psarros

• Decision Date: 01 October 1987
• Parties: PAPPAS INDUSTRIAL PARKS, INC. v. Athena PSARROS et al. 1
• Court: Appeals Court of Massachusetts

Page 621

511 N.E.2d 621

24 Mass.App.Ct. 596

PAPPAS INDUSTRIAL PARKS, INC. v. Athena PSARROS et al. ¹

Appeals Court of Massachusetts Suffolk.

Argued April 7, 1987.

Decided Aug. 7, 1987.

Further Appellate Review Denied Oct. 1, 1987.

Evan T. Lawson (Laura W. Morgan, Boston, with him), for plaintiff.

Joyce G. Perocchi, Boston, for defendants.

Before BROWN, DREBEN, and KASS, JJ.

KASS, Justice.

For purposes of deciding the appeal, we must assume that Athena and John Psarros made an oral promise to sell to Pappas Industrial Parks, Inc. ("Pappas"), real estate at 57 Fargo Street, South Boston. Pappas argues that, the Statute of Frauds notwithstanding, ² it is entitled to performance because it reasonably relied to its detriment on the oral promise, and that the Psarroses are estopped to deny that promise. We conclude that the case is one of imperfect negotiations which did not give rise to an enforceable promise, and that judgment was rightly entered for the defendants, the Psarroses. A claim under G.L. c. 93A (counsel seem to regard the inclusion of such a claim in a complaint as almost obligatory) falls with the primary contract claim.

The case was disposed of in the Superior Court on a motion for summary judgment. That is why we take it as a fact in favor of the party resisting the motion that the Psarroses made an oral promise to sell the locus to Pappas, a fact which the pleadings otherwise place in dispute. The material undisputed facts developed in the pleadings, affidavits, and depositions are as follows:

Pappas owned land and buildings at Summer and D Streets in South Boston which it proposed to make over into office space. If Pappas could find a nearby location for parking, it would be possible to concentrate more office space on the primary site which Pappas already owned. The Psarros property was located to the rear of the Pappas site, at the southeasterly corner of Fargo and D Streets, and was suitable to the purpose. Negotiations ensued. In their earliest stages there was conversation about a sale for $500,000, but the transaction soon took the shape of a tax-free exchange of real estate. This required finding a site whose location and other attributes would enable the Psarroses to carry on the parcel delivery business which they conducted under the name, Olympic Delivery Services, Inc. ("Olympic").

No site which the Psarroses would accept in exchange for their land was ever agreed upon. Pappas, however, proceeded with its project on the basis of the underlying oral promise to sell. It designed, and claims to have commenced construction of, the project incorporating the Psarros site as the location for required parking. Pappas permitted Olympic temporarily to occupy space in property Pappas owned at 647 Summer Street. Finally, Pappas terminated a lease with a tenant at still another property it owned, 370 West First Street, South Boston, to make available a location at which Olympic could carry on its business.

It is the purpose of the Statute of Frauds to suppress fraud, i.e., cooked up claims of agreement, sometimes fathered by wish, sometimes imagined in the light of subsequent events, and sometimes simply conjured up. See Elias v. George Sahely & Co., 1983 A.C. 646, 655. Lest fraud be perpetrated, caution is in order when courts raise the bar of the ancient statute. Occasionally, however, there is a configuration of facts which greatly diminishes the risk of fraud and when, to the contrary, there is risk of inequity if effect is not given to an unwritten agreement. Such is the case if a "party seeking enforcement, in reasonable reliance on the contract and on the continuing assent of the party against whom enforcement is sought, has so changed his position that injustice can be avoided only by specific performance enforcement." Restatement (Second) of Contracts § 129 (1981). The principle was applied and discussed in Hickey v. Green, 14 Mass.App.Ct. 671, 673-674 & n. 6, 442 N.E.2d 37 (1982).

Frequently, when the principle has been applied, there has been a pattern of conduct by one side which has dangled the other side on a string. So, for example, in Cellucci v. Sun Oil Co., 2 Mass.App.Ct. 722, 725-728, 320 N.E.2d 919 (1974), Id., 368 Mass. 811, 331 N.E.2d 813 (1975), the plaintiff was repeatedly assured that a deal had been made--indeed, that he was bound by it--and only a bureaucratic formality was still to be attended to. In Loranger Constr. Corp. v. E.F. Hauserman Co., 6 Mass.App.Ct. 152, 154-159, 374 N.E.2d 306, Id., 376 Mass. 757, 759-761, 384 N.E.2d 176 (1978), a supplier of moveable metal partitions left uncorrected for more than two months a price given to a contractor for purposes of enabling the latter to make a bid on a general contract. In Greenstein v. Flatley, 19 Mass.App.Ct. 351, 352-354, 474 N.E.2d 1130 (1985), a landlord submitted a lease to a prospective tenant and then, through acts and representations, strung the tenant along for more than four months before repudiating the lease which he had submitted. ³ For what may be the classic case of "stringing along," see Hoffman v. Red Owl Stores, Inc., 26 Wis.2d 683, 133 N.W.2d 267 (1965).

An essential element in the cases adverted to was that the party to whom, through word or act, representations had been made reasonably relied on those representations. That is the element missing in the instant case...