Ravosa v. Zais, 94-P-1527

• Decision Date: 02 May 1996
• Docket Number: No. 94-P-1527,94-P-1527
• Citation: 40 Mass.App.Ct. 47,661 N.E.2d 111
• Parties: Anthony William RAVOSA v. Neil ZAIS, individually and as trustee. 1
• Court: Appeals Court of Massachusetts

Page 111

661 N.E.2d 111

40 Mass.App.Ct. 47

Anthony William RAVOSA v. Neil ZAIS, individually and as trustee. ¹ No. 94-P-1527.

Appeals Court of Massachusetts Suffolk.

Argued Dec. 7, 1995.

Decided Feb. 15, 1996.

Further Appellate Review Denied May 2, 1996.

CIVIL ACTION commenced in the Superior Court Department on March 24, 1989; John C. Cratsley, J.

Dustin F. Hecker, Boston, for plaintiff.

Fredric L. Ellis, Boston, for defendant.

Before ARMSTRONG, PERRETTA and FLANNERY, JJ.

FLANNERY, Justice.

The plaintiff, Anthony William Ravosa, commenced this Superior Court action against the defendant, Neil Zais, on counts of breach of fiduciary duty as a broker, misrepresentation, breach of contract, and a violation of G.L. c. 93A, §§ 2 and 11. In answer to special questions, a jury found that there was a contract between the parties regarding the purchase, sale, and broker's commission for the Walker Building located at 1228-1242 Main Street in the city of Springfield (locus), that Zais committed a breach of the contract, that his conduct constituted misrepresentation, and that he had agreed to act as a broker for, and had been in breach of his fiduciary duty to, Ravosa. As to each of the common law counts, the jury found that the amount of Ravosa's damages was $680,000. The trial judge allowed Zais's motion for judgment notwithstanding the verdict, and Ravosa has appealed. We affirm.

Our review is to determine "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.' " Freeman v. Planning Bd. of W. Boylston, 419 Mass. 548, 550, 646 N.E.2d 139 (1995), quoting from Raunela v. Hertz Corp., 361 Mass. 341, 343, 280 N.E.2d 179 (1972). With this standard in mind, the jury could have found the following facts.

Since the early 1960s, Ravosa, an attorney, has purchased real estate in the Springfield area, including residential and commercial properties and many of the historic and other buildings surrounding the Springfield courthouses. As of the time of trial, Zais had had over thirty years' experience in real estate and had held a real estate broker's license for approximately twenty years.

During the period from 1980 to 1985, Ravosa planned to develop Court Square in Springfield by accumulating all of the nationally registered historic buildings there, including the locus, and tying them into the Springfield civic center, of which he was chairman of the board from 1978 to 1983. At that time, the locus was owned by Sophie Freedman, a party to an ongoing dispute with Ravosa. Ravosa had made numerous unsuccessful attempts to purchase the locus from Mrs. Freedman through the use of various individuals as straws, and Mrs. Freedman had indicated on several occasions that she would not sell the locus to him.

In late 1984 or early 1985, Ravosa met Zais, whom he knew to be a licensed real estate broker, at the Bar Association, a downtown Springfield restaurant, which Ravosa owned. Zais told Ravosa that he was a broker and stated, "I will get you the building. Don't worry about it, I'll get you the building." In an ensuing discussion, Zais said that he wanted a commission of $25,000, and it was agreed that how Zais was to acquire the building was left up to him. At a meeting in Ravosa's office a few days later, Zais said that he was going to see Mrs. Freedman and attempt to purchase the locus, and reiterated that the "deal" with Ravosa was for $25,000. ² It was agreed that Ravosa could reject the deal if the price was too high. Through early 1986, Zais continued to assure Ravosa that Zais would get the locus, and that his "commission" would be $25,000. ³

In March, 1986, Zais, as trustee of Red Brick Realty Trust, purchased the locus from Mrs. Freedman for $535,000. In early April of 1986, Ravosa learned of Zais's purchase of the locus at that price. Ravosa called Zais to discuss a purchase and sale agreement for the locus in accordance with their oral agreement, and Zais told him, "That's an old deal. It's gone by the boards. We have a new deal. If you want the real estate, you're going to have to pay for it, because I have a buyer sitting in the wings for it". On or about April 8 or 9, 1986, Zais told Ravosa that he wanted $990,000 and that Ravosa had to close the deal by Friday, April 11, or Zais was going to give it to somebody else.

On April 11, 1986, after discussing the matter with his attorney, negotiating with Zais's attorney over two or three days, and reviewing and revising various proposals, Ravosa signed a purchase and sale agreement and made a deposit of $49,000. He decided to do so because he "needed" the locus and he thought it would be better to go forward and own the building, and litigate later. ⁴ The purchase and sale agreement contained a clause providing that the agreement "sets forth the entire agreement between the parties hereto." On June 30, 1986, pursuant to the written agreement, Ravosa purchased the locus from Zais in Zais's capacity as trustee of Red Brick Realty Trust for $990,000.

By complaint filed on March 24, 1989, Ravosa commenced this action. Zais raised the Statute of Frauds as an affirmative defense. In allowing Zais's motion for judgment notwithstanding the verdict, the trial judge concluded that the Statute of Frauds barred Ravosa's common law claims. ⁵ The judge also found, as matter of law, that there was no fraud in the inducement of the written purchase and sale agreement, and no duress.

1. The nature of the oral contract and the applicability of the Statute of Frauds. It is settled law that "[a]n agreement to purchase land and then to convey it in whole or in part to another is 'a contract for the sale of lands, tenements or hereditaments, or of any interest in or concerning them,' G.L. c. 259, § 1; and it is none the less within this statute that the purchaser is, or is alleged to be, an agent for that other." McDonald v. Conway, 254 Mass. 429, 432, 150 N.E. 200 (1926). See Nessralla v. Peck, 403 Mass. 757, 532 N.E.2d 685 (1989). "[N]o implied or constructive trust arises merely because the defendant has agreed orally to buy land as the plaintiff's agent and then has repudiated the obligation and kept the land for himself." Salter v. Beal, 321 Mass. 105, 108, 71 N.E.2d 872 (1947), quoting from Cann v. Barry, 293 Mass. 313, 316, 199 N.E. 905 (1936). See Broomfield v. Kosow, 349 Mass. 749, 758 n. 1, 212 N.E.2d 556 (1965). It is equally true, however, that "where, by the conduct of the parties, the full relation of principal and broker has come into existence, including the carrying on of a negotiation between seller and buyer, there has come into existence with it a confidential and fiduciary relation which gives rise to a constructive trust in favor of the principal in property which the broker has acquired for himself in violation of his duty to his principal." Berenson v. Nirenstein, 326 Mass. 285, 289, 93 N.E.2d 610 (1950).

Based upon plaintiff Ravosa's own testimony, the essence of the oral agreement between the parties was that Zais agreed to purchase the locus from Mrs. Freedman and, after having done so and if acceptable to Ravosa, to sell it to Ravosa for $25,000 more than Zais paid for it. There was no evidence more favorable to Ravosa than this testimony, and thus he is bound by it. See Jacquot v. Wm. Filene's Sons Co., 337 Mass. 312, 316, 149 N.E.2d 635 (1958); Gaynor v. Laverdure, 362 Mass. 828, 841, 291 N.E.2d 617 (1973). See also Liacos, Massachusetts Evidence § 2.11, at 58 (6th ed. 1994). On that testimony, there was no issue of fact for the jury. We agree with the judge's conclusion, as matter of law, that Ravosa's testimony established that the parties' agreement was one to purchase land and that, notwithstanding Ravosa's conclusory statements to the contrary, there was no evidence that the parties had entered into a brokerage contract, ⁶ see DiBurro v. Bonasia, 321 Mass. 12, 13-15, 71 N.E.2d 401 (1947), or that any fiduciary obligations arose on the part of Zais. ⁷ Cases on which Ravosa relies are, therefore, inapposite. See Kinchla v. Welsh, 8 Mass.App.Ct. 367, 370, 394 N.E.2d 978 (1979); MacGregor v. Labute, 14 Mass.App.Ct. 203, 206-207, 437 N.E.2d 574 (1982); Dowd v. Iantosca, 27 Mass.App.Ct. 325, 331-332, 334, 538 N.E.2d 33 (1989).

Ravosa correctly asserts that "[a] plaintiff's detrimental reliance on ... an oral agreement to convey property may estop the defendant from pleading the Statute of Frauds." Nessralla v. Peck, 403 Mass. at 761, 532 N.E.2d 685. Ravosa claims that Zais, by repeatedly and falsely stating his intention to sell the locus to Ravosa for a profit of $25,000, induced Ravosa to refrain from attempting to obtain the locus through any other means (at the lower price sought by Mrs. Freedman, we assume), and that Ravosa relied on Zais's statements to his detriment. ⁸ We disagree. The evidence at trial was that, despite numerous attempts over several years, Ravosa had had no success in acquiring the locus from Mrs. Freedman directly or through straws. He did not identify at trial any other straw or real estate broker upon whom he would have relied to acquire the locus; indeed, he testified that he did not have any others. "Such illusory 'reliance' on an oral agreement to convey property does not rise to a level which estops the defendant from pleading the Statute of Frauds." Id. at 762, 532 N.E.2d 685.

2. Misrepresentation. Apart from the misrepresentations regarding the oral contract, Ravosa argues that Zais, during negotiations of the parties' written agreement, made material misrepresentations to Ravosa concerning the existence of another buyer and the area of the building for purposes of inducing him to execute that agreement.

The elements of the tort of misrepresentation are familiar. The plaintiff must show "a false statement of a material fact made to induce the plaintiff to act,...