Sanguinetti v. Nantucket Const. Co., Inc.

• Court: Appeals Court of Massachusetts
• Writing for the Court: Before HALE; HALE
• Citation: 361 N.E.2d 954,5 Mass.App.Ct. 227
• Decision Date: 14 April 1977
• Parties: Lucille SANGUINETTI, trustee, et al. v. NANTUCKET CONSTRUCTION COMPANY, INC., et al. 1

Page 954

361 N.E.2d 954 5 Mass.App.Ct. 227 Lucille SANGUINETTI, trustee, et al.
v.
NANTUCKET CONSTRUCTION COMPANY, INC., et al. ¹ Appeals Court of Massachusetts, Nantucket. Argued Feb. 15, 1977.
Decided April 14, 1977.

Page 955

John D. Dwyer, Boston, for plaintiffs.

Edward T. Bigham, Jr., Waltham, and Francis J. O'Rourke, Boston, for defendants.

Before HALE, C.J., and GOODMAN and ARMSTRONG, JJ.

Page 956

HALE, Chief Justice.

In this action Lucille Sanguinetti, as successor trustee of Windswept Realty Trust, and Grace M. Henry, as executrix of the will of Roy E. Sanguinetti, sought a judgment pursuant to G.L. c. 231A declaring (1) [5 Mass.App.Ct. 228] the former to be the owner of certain realty and (2) that the estate of Roy E. Sanguinetti is not subject to any claim of the defendants. After a trial a judge of probate entered an order for judgment under which the executrix was directed to convey that realty to the defendants, subject to certain reimbursements. The plaintiffs have appealed from that order. As no judgment was entered pursuant to that order, the case is not properly before us, but inasmuch as all of the issues have been argued and it is highly unlikely that a judgment at variance with that order would have been entered, we have chosen to deal with the issues raised by this 'appeal,' (see Nantucket Land Council, Inc. v. Planning Bd. of Nantucket, --- Mass.App. ---, --- - --- ^a, --- N.E.2d --- (1977)) and we have determined that there was no error.

We have before us the judge's 'Statement of Proceedings,' 'Findings of Fact,' 'Conclusions of Law' and 'Order for Judgment.' We also have designated portions of the transcript and the exhibits. In these circumstances in reviewing the trial judge's ultimate conclusions, which are drawn from his subsidiary findings of fact, it is our duty to draw our own inferences and reach our own conclusions. Jones v. Gingras, --- Mass.App. ---, --- ^b, 331 N.E.2d 819 (1975). Blakeley v. Pilgrim Packing Co., --- Mass.App. ---, --- ^c, 340 N.E.2d 511 (1976). We may make our own findings of fact where the jury made none. Bartevian v. Cullen, --- Mass. ---, --- n. 1 ^d, 343 N.E.2d 851 (1976). Taylor v. Lassell, --- Mass.App. ---, --- ^e, 353 N.E.2d 677 (1976). However, his findings shall not be set aside unless clearly erroneous, and due regard will be given to the opportunity of the trial judge to judge the credibility of the witnesses. Marlow v. New Bedford, --- Mass. ---, ---, ^f, 340 N.E.2d 494 (1976). Zuckerman v. Blakeley, --- Mass.App. ---, --- ^g, 338 N.E.2d 836 (1975). Mass.R.Civ.P. 52(a), 365 Mass. 816 (1974). The standard we employ to determine whether a finding is clearly erroneous is 'when although there is evidence to support it, the reviewing court is left with a definite and firm conviction that a mistake has been committed.' United States v. United States Gypsum Co., 333 U.S. 364, 395, 68 S.Ct. 525, 542, 92 L.Ed. 746 (1948). See Building Inspector of Lancaster [5 Mass.App.Ct. 229] v. Sanderson, --- Mass. ---, --- - --- ^h, 360 N.E.2d 1051 (1977); Sher v. Malden Taxi, Inc., --- Mass.App. ---, --- ⁱ, 349 N.E.2d 366 (1976).

We summarize portions of the detailed and extensive findings of the judge supplemented by our own. Nantucket Construction Company, Inc. (NCC), a road construction firm, was formed in 1946 by the defendant Rounsville, a Mrs. Ellen Ring (the mother-in-law of Sanguinetti), and one Ashley. Mrs. Ring later remarried and became Mrs. Winters. Ashley died in 1950, and NCC purchased the Ashley stock from his estate, leaving Rounsville and Mrs. Winters each as owner of one half of the outstanding capital stock of NCC. The corporate officers were Rounsville as president, Winters as clerk, and Sanguinetti as treasurer, with all three as directors. Sanguinetti was also the corporation's attorney.

In 1946 Rounsville and two partners, Williams and Killen, formed Windswept Cranberries, Inc., which purchased the property that is the subject of this action for $48,000.

Page 957

A mortgage securing the payment of $22,500 was given to Williams. The property (locus) is located in the Polpis section of Nantucket and contains about 510 acres of land, the title to which had been registered.

In 1950 title to the locus was transferred to Williams because of the inability of Windswept Cranberries, Inc., to meet the mortgage payments due to unprofitable cranberry operations. Williams died in 1954. His wife and a Connecticut bank became the executors and trustees under his will. Rounsville decided to buy the locus for NCC and operate the cranberry business as a sideline. In 1955, a lease-purchase agreement was negotiated by Rounsville with one Shepherd, the attorney for the Williams estate. The draft of the agreement, in form between the estate and Rounsville, was submitted to Sanguinetti. It provided for a $50,000 purchase price, payable in annual installments, with NCC paying Williams $1,000 as a deposit. The agreement was signed in Sanguinetti's law office and was kept by him. NCC thereupon commenced maintenance and operation of the cranberry bogs. It made some of the payments required under the agreement and paid [5 Mass.App.Ct. 230] the real estate taxes as well. The corporation expended large sums of money from its funds in maintaining and operating the cranberry bogs but met with little success in the operation.

In 1961 Mr. Shepherd, who had married the former Mrs. Williams and was acting as her attorney in her capacity as the sole trustee of the Williams estate (the bank having resigned as cotrustee), contacted Rounsville and offered to sell the locus for a cash price of $30,000 as a compromise figure to resolve a problem arising out of NCC's delinquency under the 1955 agreement. Rounsville told Sanguinetti of the offer and of his desire to purchase the locus because of its value, and Sanguinetti advised him that the locus should be purchased. Purchase arrangements were subsequently completed in Sanguinetti's office by Shepherd, Rounsville and Sanguinetti, with the last acting as attorney for Rounsville. Sanguinetti drew up a handwritten memorandum of agreement which was initialed by the parties. On December 22, 1961, Rounsville sent NCC's check for $6,000 to Shepherd and promised to pay the balance of $24,000 by February 28, 1962. Sanguinetti advised Rounsville that for tax purposes the $6,000 payment should be listed on NCC's books as interest.

Rousville asked Sanguinetti to arrange for a bank loan for the purchase money. Sanguinetti, who was a trustee and a conveyancer for and general counsel of Nantucket Institution for Savings, indicated that in view of his influence there would be no problem in obtaining a mortgage for Rounsville. Subsequently Sanguinetti informed Rounsville that the bank had agreed to a loan of $18,000 (60% of the sales price), which left $6,000 more to be raised. In obtaining the $18,000 mortgage loan Sanguinetti had submitted an application in his own name. Subsequently that application was altered by a bank employee who added the words, 'as trustee for Lee Holmes and Shedden Sanguinetti.' No trust instrument was given to the bank. (There was no evidence before the judge as to who authorized the addition of the quoted language.)

Rounsville had planned to use the proceeds from the [5 Mass.App.Ct. 231] cranberry harvest to pay the balance of $6,000, but those proceeds proved to be insufficient. Rounsville requested Sanguinetti's help in raising the $6,000, and Sanguinetti told Rounsville, 'Don't worry about it. I'll take care of it.' Later Sanguinetti informed Rounsville that he had raised the additional $6,000 by a stock collateral loan with the bank. hxes to the locus was prepared by Sanguinetti and sent to the Shepherds for signing. The deed was signed by Mrs. Shepherd as trustee, and Mr. Shepherd returned it to Sanguinetti. Mr. Shepherd did not note the name of the grantee in the deed, but both he and his wife at all times considered Rounsville to be the buyer. The deed was approved for registration by the Land Court in the name of Roy E. Sanguinetti, individually, without

Page 958

any other designation. ² The mortgage and promissory note for $18,000 were prepared by Sanguinetti. The note stated that the maker was Roy E. Sanguinetti under a declaration of trust dated March 1, 1962, but did not name the beneficiaries of the trust. The mortgage given to the bank, however, named as mortgagor 'Roy E. Sanguinetti, trustee for Lee Holmes, et al.'

On March 19 Sanguinetti registered the deed and the mortgage. The grantee in the deed and in transfer certificate of title No. 4666 filed with the registry district of Nantucket County in registration book 23 at page 106 appeared as 'Roy E. Sanguinetti, of . . . Trustee under Declaration of Trust dated March 1, 1962, with full power to sell, mortgage and convey the same . . ..' The registry cash book had entries showing the payment of registration fees for each of those instruments. There was no entry for [5 Mass.App.Ct. 232] the registration of a trust instrument on either the March 19, 1962, daily sheet or in the index in the registry, and there was no entry of a registration fee for a trust instrument in the cash book on that date. There was no statement in the deed indicating that the trust instrument referred to had previously been registered or that it was to be registered simultaneously with the deed.

The judge found that a signed copy of a declaration of trust dated March 1, 1962, known as the Windswept Realty Trust, in which Roy E. Sanguinetti was named as trustee for the benefit of Lee Holmes and others...