Trustees of Stigmatine Fathers, Inc. v. Secretary of Administration and Finance

• Decision Date: 14 January 1976
• Citation: 341 N.E.2d 662,369 Mass. 562
• Parties: The TRUSTEES OF the STIGMATINE FATHERS, INC. v. SECRETARY OF ADMINISTRATION AND FINANCE et al.
• Court: United States State Supreme Judicial Court of Massachusetts Supreme Court

Page 662

341 N.E.2d 662

369 Mass. 562

The TRUSTEES OF the STIGMATINE FATHERS, INC.

v. SECRETARY OF ADMINISTRATION AND FINANCE et al.

Supreme Judicial Court of Massachusetts, Middlesex.

Argued Dec. 4, 1975.

Decided Jan. 14, 1976.

Edward J. Barshak, Sp. Asst. Atty. Gen. (Peter L. Puciloski, Boston, with him), for defendants.

Kenneth H. Zimble, Boston (Joel Z. Eigerman, Boston, with him), for plaintiff.

Before REARDON, BRAUCHER, HENNESSEY, KAPLAN and WILKINS, JJ.

BRAUCHER, Justice.

In 1971 the Board of Trustees of State Colleges (Board) agreed to purchase the plaintiff's land and buildings for $4,200,000. The Secretary of Administration and Finance (Secretary) refused to make funds available for the purchase, and we affirm a judgment declaring that the contract is valid and that neither the Governor nor the Secretary is authorized to decline, as matter of discretion, to allot the necessary funds. We hold: (1) No abuse of discretion is shown in the denial of the Secretary's motion under Mass.R.Civ.P. 60(b)(6), 365 Mass. --- (1974), for relief from the judgment appealed from. (2) The Secretary is precluded by a prior decree from asserting alleged deficiencies in the appraisal of the property. (3) The appraisal conducted by the Secretary satisfied the requirement imposed by St.1971, c. 976, § 2B.

The contract in question was executed on July 29, 1971, subject to the enactment of a capital outlay bill including an item for the appropriation of sufficient funds and to the meeting of 'all conditions contained in such item.' By St.1971, c. 976, the Legislature appropriated sufficient funds, but § 2B ¹ forbade payment for land or land with buildings thereon 'until at least one independent appraisal of the value thereof has been made by a qualified disinterested appraiser.' The Secretary appointed an appraiser, and in May, 1973, he submitted a report that the value of the property was $4,340,000. The report was impounded and withheld from the plaintiff until after the plaintiff sued the Board. In August, 1973, the Secretary announced publicly that the Commonwealth would not purchase the plaintiff's property because 'he had concluded that the site was inappropriate' for the Massachusetts College of Art.

The plaintiff then demanded performance of the agreement and sued the Board, which was represented by an assistant attorney general. A final decree was entered by consent on November 20, 1973, declaring that the 1971 agreement was valid and binding and of full force and effect and that all of its conditions, 'including those provisions relating to acts of appropriation and any requirement for appraisal thereunder,' had been fulfilled. The Secretary nevertheless refused to allot the appropriated funds.

The plaintiff thereupon brought the present action. In his answer the Secretary admitted that, at the request of the Board and with the Secretary's approval, an independent appraisal was conducted, and that the value set forth in the appraisal was $4,340,000. The case was submitted to a judge of the Superior Court on a statement of agreed facts. The judge considered three defenses asserted by the Secretary, but did not consider any issue as to the sufficiency of the appraisal. He ruled that the Secretary was bound by the prior decree against the Board, and was estopped from raising any issue as to the validity of the agreement, and that neither the Governor nor the Secretary was authorized to decline, as matter of discretion, to allot the funds necessary to carry out the contract in accordance with its terms. He ordered the entry of a judgment so declaring.

The Attorney General declined to prosecute an appeal on behalf of the Secretary, and the time for appeal was extended until after our decision in SECRETARY OF ADMINISTRATION & FIN. V. ATTORNEY GEN., --- MASS. ---, 326 N.E.2D 334 (1975)^A, upholding the Attorney General's power so to decline. A successor Attorney General then allowed the Secretary to proceed with the appeal and appointed a special assistant attorney general to pursue it. By motion under Mass.R.Civ.P. 60(b)(6), the Secretary in July, 1975, sought relief from the judgment, asserting for the first time that the appraisal report was unacceptable on its face as a fulfillment of the condition contained in St.1971, c. 976, § 2B. He now appeals both from the judgment and from the denial of his motion for relief from it. His sole substantive contention is that the appraisal is insufficient.

1. Abuse of discretion. The appeal from the judgment does not bring to us any issue with respect to the appraisal, since no such issue was presented in the Superior Court. An issue cannot be raised for the first time before this court. Milton v. Civil Serv. Comm'n, --- Mass. ---, ---, ^b 312 N.E.2d 188 (1974).

A motion under Rule 60 is addressed to the judge's discretion, and no clear abuse of discretion in denying the Secretary's motion is shown. SCHULZ V. BLACK, --- MASS. ---, 336 N.E.2D 853 (1975)^C. Farmers Co-operative Elevator Ass'n Non-Stock of Big Springs, Neb. v. Strand, 382 F.2d 224, 232 (8th Cir.), cert. denied, 389 U.S. 1014, 88 S.Ct. 589, 19 L.Ed.2d 659 (1967). The issue sought to be asserted was plainly an afterthought. The Secretary had been contesting the purchase for more than two years on a variety of grounds, all now abandoned, without raising the point. He had failed to disclose the appraisal to the plaintiff; when it was disclosed, the Board, represented by an assistant attorney general, had consented to a decree that it satisfied the statute. The Secretary's answer admitted the appraisal, and no issue was raised with respect to it until a year after trial.

The Secretary contends that the judge did not exercise his discretion in denying the motion, but erroneously ruled as matter of law that the point was concluded by the prior decree. The transcript of the hearing on the motion does not show this, but it does not clearly show the contrary. Rather than remand for clarification, delaying final disposition still further, we therefore turn to the effect of the prior decree.

2. Issue preclusion. The judge ruled that the Secretary was bound by the decree against the Board, and the Attorney General thought the ends of government would not be advanced by an appeal. See Secretary of Administration & fin. v. Attorney Gen., --- Mass. ---, --- - ---, ^d 326 N.E.2d 334 (1975), where we characterized the judge's opinion as 'well reasoned.' We now decide that it was also correct.

We recognize that it would be an unwarranted fiction to treat all the branches of State government as a single unit for all purposes. Our books as full of cases of litigation between governmental agencies. But governmental agencies, like other litigants, are subject to 'the wholesome principle which allows every litigant one opportunity to try his case on the merits, but limits him, in the interest of the public, to one such opportunity.' Home Owners Fed. Sav. & Loan Ass'n v. Northwestern Fire & Marine Ins. Co., 354 Mass. 448, 455, 238 N.E.2d 55, 58 (1968), quoting from Jenkins v. Atlantic Coast Line R.R., 89 S.C. 408, 71 S.E. 1013 (1910). 'The crucial point is whether or not in the earlier litigation' the representative of the Commonwealth 'had authority to represent its interests in a final adjudication of the issue in controversy.' Sunshine Anthracite Coal Co. v. Adkins, 310 U.S. 381, 402--403, 60 S.Ct. 907, 917, 84 L.Ed. 1263 (1940).

There is no doubt that the Board was a proper party defendant in the plaintiff's first suit, and the Commonwealth was not an indispensable party. G & M Enployment Serv. Inc. v. Commonwealth, 358 Mass. 430, 433--434, 265 N.E.2d 476 (1970), appeal dismissed sub nom. G. & M Employment Serv. Inc. v. Department of Labor & Indus., 402 U.S. 968, 91 S.Ct. 1662, 29 L.Ed.2d 133 (1971). The Board could not by its own action foreclose the question of its authority to bind the Commonwealth. But it was represented by the Attorney General. G.L. c. 12, § 3. He is empowered 'to set a unified and consistent legal policy for the Commonwealth.' Secretary of Administration & Fin. v. Attorney Gen., --- Mass. ---, ---, ^e 326 N.E.2d 334, 339 (1975). The decree was no less conclusive because it was entered by consent. Nantucket Express Lines, Inc. v. Wood's Hole, Martha's Vineyard & Nantucket S.S. Authority, 350 Mass. 173, 176, 213 N.E.2d 862, cert. denied, 384 U.S. 952, 86 S.Ct. 1573, 16 L.Ed.2d 549 (1966).

This problem has recently been reconsidered in the Restatement (Second) of Judgments § 80, comments e, f (Tent. Draft No. 2, 1975). The reporter's note to those comments includes the following, with abundant citation of authority: 'A central issue is whether relief can be obtained against the government but, in avoidance of the sovereign immunity doctrine, through the device of a suit against an official. . . . When an action may be maintained through this device, the official concerned participates in his capacity as such, with preclusive effects on the government and the official's successors.'

3. Sufficiency of the appraisal. What we have said is sufficient to dispose of this case. But the possibility remains that relief might be sought from the decree in the plaintiff's suit against the Board. The parties have fully argued the question whether the appraisal satisfied the requirement imposed by St.1971, c. 976, § 2B. We think we should finally lay it to rest.

The statute required an 'independent appraisal . . . by a qualified disinterested appraiser.' No contention is made that the appraisal was not 'independent' or that the appraiser was not 'qualified' and 'disinterested.' The contention is rather that the appraisal was so irrational as to be no appraisal at all. The implication as to that the agreement may call for payment of a vastly inflated price for the property.

The Secretary attacks the appraisal on three distinct grounds: (1) The land was zoned 'Open Space,' but the appraiser proceeded on the...