BEARBONES INC v. GIAN (2019)

MEMORANDUM AND ORDER PURSUANT TO RULE 1:28

The plaintiffs, including a condominium unit owner, brought an action for damages against the condominium association, but the plaintiffs anticipated that the association would be unable to satisfy any resulting judgment. The plaintiffs therefore also named the owner of the other units as a defendant, in order to recover from him, under G. L. c. 183A, § 13, the unsatisfied portion of any judgment. A Superior Court judge agreed with the defendant unit owner that the suit against him was improper and allowed his motion for summary judgment. After the claims against the association were dismissed, the plaintiffs appealed. We conclude that the case is moot with regard to the defendant unit owner; in all other respects, the judgment is affirmed.

Background. The plaintiffs are a bakery and the owner of the commercial condominium unit in which the bakery operated. When a burst water pipe damaged the premises and bakery equipment, the plaintiffs filed this action against the bakery's insurer,⁴ the manager of the condominium association, and the trustee of the trust that owned the other four condominium units. For clarity, we refer hereinafter to the latter two defendants as the association and the owner of the other units, respectively.⁵

The complaint alleged that the association's failure to maintain the common area caused the pipe to burst, making the association -- which is the “organization of unit owners” as defined in G. L. c. 183A, § 1 -- a proper defendant under G. L. c. 183A, § 13. The complaint further alleged that the association lacked insurance or other assets that could be used to satisfy any judgment the plaintiffs might obtain against it, and thus the complaint asserted a right to recover from the owner of the other units under § 13.

The owner of the other units moved for summary judgment, arguing that under § 13, he could not be sued unless and until the plaintiffs both (1) obtained a judgment against the association and (2) were unable to obtain payment of the judgment by executing on the association's common funds and property. Section 13 provides:

“All claims involving the common areas and facilities shall be brought against the organization of unit owners, and all attachments and executions related to such claims shall be made only against common funds or property held by the organization of unit owners and not against the common areas and facilities themselves other than the leasehold of any lease included therein. After such common funds and property have been exhausted, individual unit owners shall be liable for the balance due, if any, provided, however, that the amount for which a unit owner is liable shall be limited to a sum equal to the amount of his percentage interest in the common areas and facilities times the balance due.”

A judge allowed the summary judgment motion, but did not direct the entry of a separate final judgment for the owner of the other units under Mass. R. Civ. P. 54 (b), 365 Mass. 820 (1974), leaving him as a party to the case.⁶ On the day that trial was set to begin on the plaintiffs' claims against the association, the plaintiffs informed the trial judge that they were unable to produce any witness to testify to their damages and therefore did not wish to go forward with the trial. Accordingly, the judge dismissed the case with prejudice for lack of prosecution.⁷

Discussion. On appeal, the plaintiffs challenge only the allowance of summary judgment for the owner of the other units; they have waived any challenge to the dismissal of their claims against the association. As the owner of the other units argues, that choice renders this appeal moot as to him.

Because he can be liable to the plaintiffs under G. L. c. 183A, § 13, only if the association is also liable on the plaintiffs' claims, and because on appeal the plaintiffs press no argument that could lead to the association being found liable on those claims, the owner of the other units now cannot be liable to the plaintiffs on those claims. Thus it makes no practical difference to the plaintiffs whether they were entitled to name the owner of the other units as a defendant in the first place. Revival of the plaintiffs' claims against him would accomplish nothing of substance. “Litigation ordinarily is considered moot when the party claiming to be aggrieved ceases to have a personal stake in its outcome” (quotation omitted). Aquacultural Research Corp. v. Austin, 88 Mass. App. Ct. 631, 633 (2015).

Conclusion. Because the claims against the owner of the other units are moot, so much of the judgment that dismisses the claims against him with prejudice is vacated, and a new judgment shall enter dismissing the claims against him, not on the merits, but because the claims have become moot. See id. at 634-635. In all other respects the judgment is affirmed.⁸

So ordered.

vacated in part; affirmed in part

FOOTNOTES

4.   The plaintiffs later voluntarily dismissed their claim against the insurer; we do not discuss it further.

5.   Although the plaintiff Amaral Enterprises LLC is also a unit owner, none of the parties argues that its status as such should affect our analysis under G. L. c. 183A, § 13. Thus our references to the plaintiffs include Amaral Enterprises LLC; our references to unit owners do not. Also, that the same individual, Charles J. Gian, is a defendant in two separate capacities does not affect our analysis.

6.   The judge noted, however, that “pre judgment security is required due to [the] particular facts of this case.” The judge thus approved attachments of $ 250,000 against each of the owner's four units. Another judge later dissolved those attachments, reasoning that the owner had been dismissed from the case and so there was no basis for attachments against his units. On appeal, the parties make no arguments as to the propriety of either order.

7.   The caption of the final judgment did not list all of the defendants, but it expressly dismissed the plaintiffs' complaint with prejudice. Because no judgment pursuant to rule 54 (b) had previously entered as to the owner of the other units, the final judgment effectively dismissed those claims on the merits, with prejudice, as well. As discussed infra, because the claims against him have become moot, our disposition makes a distinction between those claims and the claims against the association.

8.   The association's request for appellate attorney's fees and double costs is denied.