Wilion v. Emigrant Mortgage Co., Inc., MICV2015-06127-H

CourtSuperior Court of Massachusetts
PartiesHarold Wilion v. Emigrant Mortgage Company, Inc. No. 134854
Docket NumberMICV2015-06127-H
Decision Date26 September 2016

Harold Wilion

Emigrant Mortgage Company, Inc.

No. 134854

No. MICV2015-06127-H

Superior Court of Massachusetts, Middlesex

September 26, 2016


Peter B. Krupp, Justice

After plaintiff Harold Wilion purchased certain residential property at 1643 Cambridge Street in Cambridge (" the property") from defendant Emigrant Mortgage Company, Inc. (" Emigrant") at a foreclosure sale, the Supreme Judicial Court found Emigrant's foreclosure invalid because Emigrant had failed to comply with the notice of default provisions in the mortgage. Pinti v. Emigrant Mortgage Co., Inc. (" Pinti "), 472 Mass. 226, 231-44, 33 N.E.3d 1213 (2015). This action followed. Plaintiff seeks to recover his costs and associated damages in connection with his purchase of the property, which Emigrant, it turned out, did not have the lawful right to convey. Before me are cross motions for summary judgment. After hearing, and consideration of the parties' post-hearing submissions, [1] the plaintiff's motion is ALLOWED and defendant's cross motion is DENIED.


In 2008, Linda Pinti and Lesley Phillips (together, " Pinti") owned the property. In March 2008, Pinti gave Emigrant a mortgage on the property in exchange for a loan. Pinti defaulted on the loan in December 2009 and Emigrant initiated foreclosure proceedings. On August 9, 2012, Emigrant held a foreclosure sale of the property. Plaintiff was the highest bidder. See generally Pinti, 472 Mass. at 227-29.

On August 9, 2012, plaintiff and Emigrant executed a Memorandum of Sale (" the MOS") for the property and plaintiff paid an initial $5, 000 deposit. At argument, the parties agreed the MOS was drafted by Emigrant. The MOS defined Emigrant as " the Bank" and plaintiff as " Buyer." As is relevant to this case, Section 6 of the MOS provides:

In the event the Bank for any reason cannot convey title to the Property as stipulated, the deposit, and if applicable, the balance of the purchase price, shall be refunded and all rights hereunder shall cease, and the Buyer shall have no recourse against the Bank, or its employees, agents and representatives, whether at law or in equity; provided, however, that Buyer shall have the election to accept such title as the Bank can deliver to the Property in its then condition and to pay therefore the purchase price without deduction, in which event the Bank shall convey such title. In the event of such election by Buyer, the Bank shall have no duty or obligation to remove any cloud or defect in title
The Bank reserves the right to cancel this Memorandum in the event that . . . (d) as a result of claims asserted by third parties against the Bank or against the Property the Bank determines that it is not in the best interest of the Bank and/or the mortgagor(s) to convey the Property to Buyer. In the event of such cancellation by the Bank, the deposit, and, if applicable the balance of the purchase price, shall be refunded and all rights hereunder shall cease, and the Buyer shall have no recourse against the Bank, its employees, agents attorneys or representatives, whether at law or in equity (Emphasis added).

On September 10, 2012, Emigrant conveyed the property to plaintiff for the purchase price of $260, 000. Pinti, 472 Mass. at 229.

After plaintiff purchased the property, Pinti remained at the property. Plaintiff filed a summary process action for possession. In defense, Pinti challenged the validity of Emigrant's foreclosure sale. In October 2013, the Superior Court upheld the foreclosure process and entered judgment in favor of plaintiff [31 Mass.L.Rptr. 528]. Pinti appealed. In a decision dated July 17, 2015, a divided Supreme Judicial Court reversed, finding that Emigrant failed strictly to comply with the notice of default provision in the mortgage and therefore that the foreclosure sale was void. Pinti, 472 Mass. at 227, 232-42.

Finding himself divested of title to the property by the decision in Pinti, plaintiff sought to recover his damages from Emigrant.[2] On September 25, 2015, plaintiff's counsel sent a letter to Emigrant's counsel demanding that Emigrant pay plaintiff the then-fair market value of the property, which he contended had appreciated considerably beyond the $260, 000 purchase price, plus his out-of-pocket expenses incurred as a result of Emigrant's invalid foreclosure of the property. When the parties were unable to reach an agreement, on September 30, 2015, plaintiff's counsel demanded at least " that Emigrant refund the purchase price immediately, without any conditions and without any party releasing rights, claims or defenses." According to plaintiff's counsel, plaintiff " is in desperate need of his funds that are being wrongly held by Emigrant." In response, on October 2, 2015, Emigrant's counsel requested plaintiff's address in order " to cut the check." Plaintiff's counsel responded on the same day by providing plaintiff's address, directing Emigrant to send the check directly to plaintiff, and wrote: " To avoid any later confusion, I should again [s]ay that the receipt of this payment is without prejudice and without waiver of any rights or defenses of any party." [3]

Emigrant sent plaintiff a check dated October 5, 2015 for $260, 000 with a cover letter dated October 8, 2015.[4] The cover letter stated:

Emigrant is returning Mr. Wilion's purchase funds in accordance with the terms of the Memorandum of Sale executed by Mr. Wilion on August 9, 2012. Pursuant to the terms of the Memorandum of Sale, the return of these monies constitutes full satisfaction of any obligations Emigrant may have had to Mr. Wilion, and he has no further recourse against [Emigrant].

Plaintiff cashed the check on October 14, 2015.

Two weeks later, plaintiff filed this action. Plaintiff brings claims for negligence, negligent misrepresentation, breach of contract and breach of warranty. Based on a largely stipulated record, [5] the parties each move for summary judgment. Emigrant argues the language of the MOS applies, it properly invoked the termination clause, and the MOS caps plaintiff's potential recovery at the purchase price. Plaintiff contends the MOS does not apply to this situation. Emigrant also argues plaintiff's claims are barred by principles of accord and satisfaction and equitable estoppel. I address each argument in turn.


I. The Summary Judgment Standard

Summary judgment is granted when there are no genuine issues of material fact and the moving party is entitled to judgment as a matter of law. Mass.R.Civ.P. 56(c); Cassesso v. Commissioner of Corr., 390 Mass. 419, 422, 456 N.E.2d 1123 (1983); Community Nat'l Bank v. Dawes, 369 Mass. 550, 553, 340 N.E.2d 877 (1976). Each moving party must demonstrate the absence of a triable issue on its claim, and that the summary judgment record entitles it to judgment as a matter of law. Flesner v. Technical Commc'ns Corp., 410 Mass. 805, 808-09, 575 N.E.2d 1107 (1991); Pederson v. Time, Inc., 404 Mass. 14, 16-17, 532 N.E.2d 1211 (1989); see Kourouvacilis v. General Motors Corp., 410 Mass. 706, 716, 575 N.E.2d...

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