Sawyer v. Shorter

• Decision Date: 19 April 2011
• Docket Number: 10-P-1255
• Parties: SAMUEL G. SAWYER, JR. v. RYAN SHORTER.
• Court: United States State Supreme Judicial Court of Massachusetts Supreme Court

SAMUEL G. SAWYER, JR.

v. RYAN SHORTER.

10-P-1255

Supreme Judicial Court of Massachusetts

Entered: April 19, 2011.

NOTICE: Decisions issued by the Appeals Court pursuant to its rule 1:28 are primarily addressed to the parties and, therefore, may not fully address the facts of the case or the panel's decisional rationale. Moreover, rule 1:28 decisions are not circulated to the entire court and, therefore, represent only the views of the panel that decided the case. A summary decision pursuant to rule 1:28, issued after February 25, 2008, may be cited for its persuasive value but, because of the limitations noted above, not as binding precedent.

COMMONWEALTH OF MASSACHUSETTS APPEALS COURT

MEMORANDUM AND ORDER PURSUANT TO RULE 1:28

The plaintiff, Samuel G. Sawyer, Jr., appeals following the entry of summary judgment in favor of the defendant, Ryan Shorter. On appeal, the plaintiff argues that the motion judge erred in interpreting the amount of his liquidated damages under the provisions of a purchase and sale agreement. We affirm the judgment of the Superior Court.

Background. The following facts are undisputed. In August, 2008, the defendant (buyer) submitted a written offer to purchase real estate located at 108 Hunnewell Avenue in Newton to the plaintiff (seller). With the offer to purchase, the buyer also submitted a $1,000 deposit. Shortly thereafter, on September 15, 2008, the parties executed a purchase and sale agreement (agreement), with the buyer agreeing to purchase the property for $900,000.

The agreement between the parties contained several provisions addressing that it was to be a short sale of the property. A short sale is one in which the potential sale proceeds of the property fall short of the balance owed by the seller to the mortgagee. For this reason, successful short sales are contingent on the agreement of the lender to release the mortgage lien for less than the total amount due under the promissary note. See generally Short Sales, Deeds-in-lieu & Receiverships at 11-27 (MCLE 2010). The agreement between the parties addressed this contingency, providing that $44,000 was 'to be paid upon approval of [the] short sale by [the] current mortgagee, ' in addition to the $1,000 deposit that was paid with the offer to purchase. The agreement further provided, however, that if the buyer breached the agreement, 'all deposits made hereunder by the buyer shall be retained by the seller as liquidated damages which shall be the seller's sole and exclusive remedy at law or in equity. Until such time as the buyer tenders the additional deposit of $44,000, liquidated damages shall be limited to $1,000.' Under the agreement, the seller was allowed to continue to market the property until the buyer paid the second deposit. The record indicates that these additional provisions were negotiated and agreed upon by the parties' attorneys.

On December 11, 2008, the seller's attorney contacted the buyer's attorney by telephone, and informed him that he had received verbal approval from the mortgagee for the short sale. Later the same day, the buyer's attorney responded by faxing a letter of termination on the part of his client, noting that the seller was entitled to keep the $1,000 in liquidated damages.

Shortly thereafter, on December 24, 2008, the seller filed a complaint in the Superior Court alleging that he was owed $45,000 under the agreement because, following notice of approval, the buyer was required to pay him the second deposit of $44,000. On cross motions for...