Wasserman v. Agnastopoulos

• Decision Date: 30 October 1986
• Citation: 22 Mass.App.Ct. 672,497 N.E.2d 19
• Parties: Peter WASSERMAN v. Irene AGNASTOPOULOS.
• Court: Appeals Court of Massachusetts

Page 19

497 N.E.2d 19

22 Mass.App.Ct. 672

Peter WASSERMAN v. Irene AGNASTOPOULOS.

Appeals Court of Massachusetts,

Middlesex.

Argued April 9, 1985.

Decided Aug. 28, 1986.

Further Appellate Review Denied Oct. 30, 1986.

John M. Connolly (W. Arthur Garrity, III, Boston, with him), for plaintiff.

George P. Butler, III, Cambridge, for defendant.

Before ARMSTRONG, KAPLAN and KASS, JJ.

ARMSTRONG, Justice.

Peter Wasserman, who brought this action for eviction and rent arrearages, appeals from a judgment entered against him in the amount of $52,300 plus attorney's fees on the defendant's counterclaim. The case was tried to a judge sitting without a jury, who made careful findings which, as slightly amplified by reference to the supporting evidence, we recount.

In 1977 the defendant, Irene Agnastopoulos, ¹ with the assistance of her father and sister, started a restaurant, Porter Square Seafood, on Massachusetts Avenue in Cambridge. The Agnastopouloses obtained the restaurant premises on a ten-year lease, ² at a fixed $1,400 per month rental, from the trustees of "Leonard Trust," the controlling force behind which was one Max Wasserman, the father of the plaintiff. ³ The person who acted as rent collector and manager of the property was one Michael Coyne, who was one of the three trustees of the Leonard Trust.

From 1977 until it closed on February 29, 1980, the restaurant operated at a loss. On occasion the rent was not paid on time. A letter would arrive, on Leonard Trust stationery, signed by Michael Coyne, trustee, threatening eviction. Such letters were sent on February 15, 1979, April 17, 1979, and January 9, 1980. While sometimes late, the rent was always paid (at least through January of 1980). The rent checks were made out to Leonard Trust. They would come back with the endorsement, "For deposit only. Leonard Trust."

In the closing months of 1979, the Agnastopouloses were ready to call it quits, and Irene asked a broker to look for a buyer for the business. In December she delivered the rent check in person to the Leonard Trust office. Max Wasserman was there (Coyne was away), and she spoke to him about her problems. He told her that if she found a prospective buyer she should "send him up" to the office. In late December a broker produced a prospect named Kek Cheng Chang, who was interested in buying the business from Irene Agnastopoulos and converting it to a Chinese restaurant. Seeing that Chang was a serious prospect, Irene put him in touch with the Leonard Trust people in late December or early January. In early January Irene's father suffered a heart attack and was thereafter incapacitated from working in the restaurant, doubtless firming her resolve to complete a sale if possible. She and Chang were in tentative agreement on the sale, awaiting the lease arrangements with Leonard Trust to be worked out.

On February 22, 1980, Irene was told both by Chang and by Michael Coyne that a lease arrangement had been worked out agreeable to both parties. On the same date Michael Coyne sent a copy of the proposed lease to Chang's attorney. It was a ten-year lease and provided for the rental of $1,400 per month during the first seven years (the remaining seven years of the Agnastopoulos lease) and $1,600 per month in the final three years. The attorney was to have his client sign the lease and return it to Michael Coyne with a check for $4,200 (one month's rent and two months' security deposit). "Upon receipt," the cover letter said, "a signed executed copy by the LESSOR will be returned to you or your clients as directed." The cover letter was on Leonard Trust stationery. It was signed, "The Leonard Trust, by Michael J. Coyne, trustee." The lessor named in the lease was "The Leonard Trust."

A week later, on February 29, 1980, Chang and the Agnastopouloses signed a purchase and sale agreement for the business and all of its equipment and furnishings. The purchase price was $40,000. The Agnastopouloses were responsible for paying all debts of the business. The passing of papers was to be at the end of March, but Irene agreed to close down the business immediately so that Chang could remodel the premises during March, in anticipation of an April opening of the Chinese restaurant. The agreement was made contingent on the signing of a ten-year lease of the restaurant premises satisfactory to Chang. Damages were to be liquidated at $2,000 (paid February 29, as a deposit) in the event Chang should default. In reliance on this agreement, Porter Square Seafood closed its doors for the last time on February 29, 1980. The contemplated sale to Chang, however, was about to be derailed.

Unbeknownst to Chang and the Agnastopouloses, almost a year before, on March 15, 1979, Michael Coyne, acting as trustee of the Leonard Trust, ⁴ at the behest of Max Wasserman and his wife (see n. 3, supra ), had executed a deed transferring the restaurant premises to the plaintiff Peter Wasserman. The transfer was part of a large property settlement apparently worked out in the aftermath of the decision in Wasserman v. Wasserman, 7 Mass.App.Ct. 167, 386 N.E.2d 783 (1979). ⁵ The memorandum of settlement called for the deed to be executed immediately and for Peter to manage the property, "subject to the terms of the leases." It also provided that the rental payments were to be collected by Max and expenses paid by him up to August 15, 1980, at which time Peter would take over the full management responsibility and would in his own name collect all rents. It further stated that Peter was to have a "right of veto over new tenants, to be exercised reasonably." The deed transferring the property had not been recorded. This was intentional, although the reason is not explained on the record before us. (The deed was not actually recorded until some time in 1981.)

On March 1, 1980, Peter returned from a vacation and learned of Michael Coyne's dealings with Chang and the Agnastopouloses. He was angry with Coyne for having allowed matters to proceed so far without consulting him. His plans for the property, he said, called for a French restaurant or possibly Italian--not Chinese. Peter dispatched three letters on March 10 (to Irene and her father at home and at the restaurant, and to Chang's attorney) asserting his ownership of the building and the necessity for any lease arrangement to be approved by him. He told Irene of his aversion to Chinese restaurants based on a previous experience. Nevertheless, he arranged for Chang to meet with him. Peter sought agreement on several points as to which the landlord had some say under the existing leases (the Agnastopoulos lease and the proposed Chang lease), such as garbage disposal and cooking exhaust controls. He also made demands that would require renegotiation, such as a substantially higher rental ($1,400 per month for three years, $1,900 for the next three, and $2,500 for the final four), exterior sign control by the landlord, and possibly the purchase of a liquor license held by Peter for $30,000. Chang came away from the meeting convinced that Peter did not like him and that they would find it difficult to reach an agreement. A letter from Peter to Chang's attorney on May 24, 1980, indicates a breakdown of negotiations (although it ostensibly leaves the door open to further talks). Invoking the condition in the purchase and sale agreement, Chang sought and received his $2,000 deposit back from Irene Agnastopoulos.

Irene made no attempt thereafter to reopen the restaurant. She had many debts, and she claimed to be unable to invest the capital necessary to begin again. A restaurant owner Peter found offered to buy Irene's kitchen equipment for $5,000. She rejected the offer. A refrigeration company which was her principal creditor repossessed all her equipment and perhaps furnishings; she testified that that discharged her ($6,500) debt. The record does not disclose with any certainty whether anything of value remained on the premises.

Chang apparently sued Peter Wasserman, but so far as the record indicates nothing came of it. The premises remained vacant, and Irene paid no further rent. In July Peter's attorney sent Irene a notice to quit. In August suit was brought in Peter's name to recover the premises and to collect back rent to December, 1979. Irene surrendered possession without protest; she asserted that she had paid the rent through March, 1980 (counting her security deposit), and denied liability for rent thereafter. The judge accepted that and ordered judgment for Irene on Peter's claim. On the counterclaim by Irene against Peter, the judge computed Irene's actual loss as follows: the purchase price negotiated with Chang, $40,000, less the broker's commission and indebtedness on equipment which was to have been included in the sale: $5,000 and $8,850 respectively, for a net loss of $26,150. On a theory of recovery under G.L. c. 93A, § 11, he awarded double damages, or $52,300, plus attorney's fees and expenses of $10,000 and $1,082.29 respectively.

On the view we take, it will be unnecessary to discuss much of what has been argued in this well-briefed case. We agree with the judge that the actions of Peter Wasserman constituted a violation of the standard of conduct set out in G.L. c. 93A, § 2(a ). We need not focus directly on the ground relied upon by the judge. We are satisfied on the findings that Peter's actions were unfair and overbearing to Irene, who had justifiably placed reliance on the actions of a person, Coyne, who Peter had allowed her to think had authority to act with respect to the lease.

The Agnastopouloses, prior to negotiations with Chang, had had only one indication of Peter's involvement. In late December, after Irene had talked to Max about selling the business, a letter arrived addressed to Irene's father, signed "Peter Wasserman, Manager." The letter stated that Peter agreed to allow the father to terminate the lease as of July 1, 1980, earlier...