Town of Norwood v. Adams-Russell Co., Inc.

• Decision Date: 11 February 1988
• Docket Number: ADAMS-RUSSELL
• Parties: TOWN OF NORWOOD et al. 1 v.CO., INC.
• Court: United States State Supreme Judicial Court of Massachusetts Supreme Court

Page 253

519 N.E.2d 253

401 Mass. 677

TOWN OF NORWOOD et al. ¹ v. ADAMS-RUSSELL CO., INC.

Supreme Judicial Court of Massachusetts Norfolk.

Argued Nov. 3, 1987.

Decided Feb. 11, 1988.

James C. Heigham (Stephen R. Latham, Boston, with him), for defendant.

Bruce A. Singal (Philip Sussler, Boston, with him), for plaintiff.

Before HENNESSEY, C.J., and LIACOS, NOLAN, LYNCH and O'CONNOR, JJ.

LIACOS, Justice.

The defendant, Adams-Russell Co., Inc. (Adams-Russell), the company licensed to provide cable television services to the town of Norwood (town), instituted a rate increase for its "Expanded 52" tier of cable service, effective September 1, 1985. The town and its board of selectmen (board) brought suit seeking to prevent, or, thereafter, roll back, the rate increase. ² The complaint alleged breach of the "rate freeze" provision of the license (count 1) and violation of G.L. c. 93A (1986 ed.) (count 2). The plaintiffs moved for summary judgment on both counts of the complaint. The parties filed affidavits and briefs, and a hearing was held on the motion. Summary judgment was granted as to count 1, pursuant to Mass.R.Civ.P. 54(b), 365 Mass. 820 (1974). The judge deferred ruling on count 2 and on the relief to be granted on the judgment for count 1. Adams-Russell appealed the partial summary judgment, and we transferred this case from the Appeals Court on our own motion. ³ We affirm the entry of partial summary judgment.

In 1980, the board began seeking a company to provide cable television services to the town. A number of companies, including Adams-Russell, responded to the town's advertisements by submitting proposals. The board reviewed the proposals and chose Adams-Russell. A provisional license was issued to Adams-Russell on September 22, 1981; a final license was issued on July 27, 1982.

The final license contained a schedule of rates. The rates varied depending on the type of service chosen by a subscriber. For example, the "Basic 20" service, which provided reception of signals from local stations as well as from two "Super Stations" (WTBS from Atlanta, Georgia, and WOR from New York City), was scheduled in the final license to cost $4.50 a month. The "Expanded 52" service (later known as "Supercable" service), which provided the "Basic 20" service and service from additional stations such as Music Television (MTV), Sports Network (ESPN), and Cable News Network (CNN), was scheduled in the final license to cost $7.50 a month. The final license also contained a two-year rate freeze provision. Section 31(e) of the final license stated: "Rate Freeze: The Licensee agrees that it will not change the schedule of monthly rates for all cable and Pay TV services for at least twenty-four (24) months after the cable system is initially fully constructed and energized. When this construction is complete, Licensee shall request certification of complete construction from the Issuing Authority or its Designee which shall be granted promptly upon submission by the Licensee to the Issuing Authority or its Designee a map of the Town of Norwood showing that construction of plant has passed all residences in the Town of Norwood existing, as of the date of the Final License, and has been fully activated...."

Adams-Russell began construction of the system in the fall of 1982. As of September 1, 1983, all public rights of way in the town had been wired. However, cable television service was not available to residents in some large, privately owned apartment complexes until some time after May, 1985. The systems manager of Adams-Russell in Norwood, Jay Somers, asserted that uncooperative landlords, and other factors beyond Adams-Russell's control, caused the delays in providing service to those areas.

In May, 1984, in accordance with the rate freeze provision of the license (§ 31[e] ), Adams-Russell certified to the town that "[a]erial construction was completed by September 1[, 1983,] and underground construction was completed by December 31[, 1983]." Adams-Russell requested a "Certification of Complete Construction" and indicated that it would supply a map of completed construction. The map was never supplied, and a "Certification of Complete Construction" was never issued.

The "institutional loop," a "network [providing] two-way interconnection between all schools, private institutions, municipal buildings, houses of worship, and doctors' offices located along the institutional network" was to be constructed as a part of the cable system. As of February, 1985, a number of schools and houses of worship were still not connected to the loop.

On July 25, 1985, Adams-Russell wrote to the board announcing its intention to raise rates for the "Supercable Tier" from $7.50 a month to $14.50 a month, effective September 1, 1985. The cost of the "Basic 20" service remained at $4.50 a month. This litigation followed.

Breach of the rate freeze provision. Adams-Russell argues that summary judgment should not have been entered on count 1 because there exist genuine disputes of material fact as to whether Adams-Russell complied with the rate freeze provision. Specifically, Adams-Russell contends that there are disputes over when "the cable system [was] initially fully constructed and energized," whether the "institutional loop" was a part of the cable system required to be "initially fully constructed and energized," and whether factors beyond Adams-Russell's control caused the delay in completing the cable system.

Rule 56(c) of the Massachusetts Rules of Civil Procedure, 365 Mass. 824 (1974), provides that a judge shall grant a motion for summary judgment "if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." "[A]ll doubt as to the existence of a genuine issue of material fact must be resolved against the party moving for summary judgment." Attorney Gen. v. Bailey, 386 Mass. 367, 371, 436 N.E.2d 139, cert. denied, 459 U.S. 970, 103 S.Ct. 301, 74 L.Ed.2d 282 (1982), quoting Gross v. Southern Ry., 414 F.2d 292, 297 (5th Cir.1969). "[T]he moving party must affirmatively show that there is no real issue of fact." Hub Assocs. v. Goode, 357 Mass. 449, 451, 258 N.E.2d 733 (1970). Applying the above principles to the facts in this case, our inquiry focuses on whether the judge erred in determining that the town affirmatively demonstrated that there was no factual dispute as to its contention that the "cable system" was not "initially fully constructed and energized" as of September 1, 1983, two years before the rate increase went into effect.

Section 1(d) of the final license defines the "Cable System" as: "[A] facility which receives and amplifies the signals broadcast by one or more television stations and redistributes such signals through Residential and Institutional systems to subscribing members of the public for a fixed or periodic fee, employing wires, amplifiers, cables and/or optical fibers passing along, over, under, across and upon streets, ways, lanes, alleys, parkways, bridges, highways and other public places, including property over which the Town has an easement of right-of-way and including facilities which in addition to providing such reception, amplification and redistribution, are also used to originate and distribute programs or other material to such subscribers; and in particular, the cable system to be constructed and operated in the Town of Norwood in accordance with the terms and conditions of this license" (emphasis supplied).

Adams-Russell, in its request for certification of complete construction, admitted that the underground construction of the cable system was not completed until December, 1983. Adams-Russell does not refute that fact but argues that all of the public rights of way in Norwood were wired and ready for service by September 1, 1983. The rate freeze provision requires a two-year moratorium on rate increases after the "cable system" is "initially fully constructed and energized." The cable system is not defined in the license as being limited to aerial construction along public rights of way, but includes "wires, amplifiers, cables and/or optical fibers passing ... under ... streets, ways, lanes, alleys, parkways, bridges, highways and other public places" (emphasis supplied).

In addition, the town demonstrated that there was no factual dispute that the institutional loop was not "initially fully constructed and energized" by September 1, 1983. Adams-Russell argues that the rate freeze provision does not require that the institutional loop be completed because the rate freeze applies only to residential rates, and the institutional loop is a separate closed-circuit, two-way television communication system that is provided without charge. In contrast, the definition in the final license of the "Cable System" includes "a facility which receives and amplifies ... and redistributes [the] signals through Residential and Institutional systems." Clearly, the institutional loop is a part of the cable system and, as such, must have been completed by September 1, 1983, in order for the rate increase not to have violated the rate freeze provision.

Adams-Russell contends that factual disputes exist regarding whether the town caused the delays in the completion of the cable system. Adams-Russell points to delays in the town's director of public works' issuance of underground work permits and delays in "make ready" work needed on poles for the aerial system. The rate freeze provision unconditionally states that Adams-Russell will not raise rates for two years after the system is "initially fully constructed and energized." This is in marked contrast to the conditional language in other sections of the license. For example, § 7 of the final license, dealing with the commencement of service,...