Skip to main content


Reset A A Font size: Print

Appeals Court of Massachusetts.



Decided: April 21, 2021

By the Court (Milkey, Kinder & Sacks, JJ.1)


Cygilant, Inc. (“Cygilant”) leased commercial space at an office park in Acton. Approximately two years before its lease term ended, Cygilant decided it would be better served by an office in Boston, and attempted to abandon the premises in Acton. The landlord, 31-43 Nagog Park, LLC (“Nagog”), declared Cygilant in breach of the lease, and sought damages. Years of litigation followed. On summary judgment, a Superior Court judge (motion judge) ruled that Cygilant had indeed defaulted on the lease. That left damages as the main issue for trial, which was a bench trial in which the parties waived detailed findings of fact and conclusions of law.

The bulk of Nagog's claimed damages arose under a lease provision that entitled it to contractual damages in the form of “accelerated rent.” In effect, Nagog immediately was entitled to recover the net present value of all of the rent still owed by Cygilant, minus an offset for value of the remaining leasehold (set as the net present value of the fair rental value of the premises over the remaining lease term). Throughout most of the litigation, Nagog refused to acknowledge the offset. Shortly before trial, it took the position that the value of the offset was zero.

Ultimately, the trial judge, apparently rejecting Nagog's proof of its accelerated-rent damages, awarded nothing for accelerated rent.2 The judge did award Nagog approximately $18,000 in other contractual damages, and well over $200,000 in attorney's fees and costs, pursuant to the lease. Both sides appealed.

In its appeal, Nagog argues that the trial judge erred by failing to award it accelerated-rent damages. In its cross appeal, Cygilant argues that the motion judge erred in ruling that it breached the lease as a matter of law, and that the trial judge erred in awarding Nagog such a large amount of attorney's fees despite the small damages award. We affirm the judgment in its entirety.

Background. We briefly summarize the history of this dispute, reserving certain details for future discussion.

Cygilant is in the business of providing digital security services. In 2005, it leased premises located in an office park at 31-43 Nagog Park in Acton, Massachusetts to establish an office. Nagog did not yet own the building.

The lease was extended and the leased premises expanded several times. By the beginning of 2015, Cygilant was leasing approximately 10,000 square feet (the “premises”) at a monthly base rent of seventeen dollars per square foot. The rent was set to increase annually until the lease terminated in September 2017. The latest lease amendment provided Cygilant the option to pay a fee and terminate early. That option expired on May 31, 2014. Any other early surrender of the premises required the landlord's agreement.

In late 2014, Nagog bought the building from National Development. Around the same time, Cygilant decided to move the office to Boston. Cygilant hired an agent who made some unsuccessful attempts to sublet the premises.

Within a few months after Cygilant informed Nagog of the planned move, relations between the parties broke down. In April of 2015, Cygilant vacated the premises. Shortly thereafter, Richard D. Vetstein, then counsel for Cygilant, sent Nagog a letter (“the Vetstein letter”) notifying Nagog that Cygilant had vacated the premises and indicating that Cygilant intended to stop paying rent at the end of May. The letter also purported to exercise the early-termination option (notwithstanding the fact that that option expressly had expired) and declared that Cygilant had surrendered the premises. Nine days later, Nagog responded with a letter, termed a “Notice of Default,” terminating the lease and demanding that Cygilant pay contract damages of around $450,000.

In May of 2015, Cygilant brought an action to have its and Nagog's rights and remedies judicially declared; as the motion judge put it, Cygilant “beat[ ] its landlord to the courthouse,” Nagog brought counterclaims, and the litigation thereafter dragged on for years. In the meantime, beginning in fall of 2016, Nagog successfully relet portions of the premises to new tenants who eventually occupied the entire premises. Nagog earned approximately $65,000 net of costs from reletting the premises through the end of Cygilant's lease term. The new tenants paid a nominal base rent of $16.50-16.75 per square foot, although Nagog made certain lease concessions, such as months of free rent.

In March of 2018, Nagog won a ruling at summary judgment that Cygilant's abandonment of the premises amounted to a default. Well over a year later, Nagog and Cygilant tried the case. Pursuant to Superior Court Rule 20(2)(h), Nagog and Cygilant waived detailed findings of fact and rulings of law. See Motsis v. Min's Supermarket, Inc., 96 Mass. App. Ct. 371, 379 n.20 (2019).

After trial, the trial judge awarded Nagog $18,772.81 in past-due rent, utilities, and re-letting costs, but zero dollars in accelerated-rent damages. Pursuant to another lease provision, the judge also awarded Nagog $231,791.56 in attorney's fees and costs. Finally, she awarded Cygilant a $47,984.50 credit for its remaining security deposit. This cross appeal followed.

Discussion. The cross appeals implicate various questions of jurisdiction, liability, damages, and fees. We take the issues in that order.

1. The status of the cross appeal. At the point that Cygilant attempted to file its “principal and response brief,” this court notified Cygilant that it had not paid a separate docketing fee, and that the cross appeal therefore had not been docketed. See Mass. R. A. P. 10 (a) (1) (A), as appearing in 481 Mass. 1618 (2019). Cygilant then moved to docket its cross appeal late, but a single justice of this court denied it leave to do so. It appears undisputed that the failure to pay the docketing fee was a simple oversight on Cygilant's part, and that Cygilant's error has not materially delayed the litigation or otherwise prejudiced Nagog. See Mailer v. Mailer, 387 Mass. 401, 406 (1982). Cygilant asks that we overrule the single justice or otherwise reach the cross appeal under Mass. R. A. P. 3 (a), as appearing in 481 Mass. 1603 (2019).

We pass over this issue. Regardless of whether Cygilant's cross appeal is properly before us, none of Cygilant's appellate arguments succeed. Cf. Matter of M.S., 99 Mass. App. Ct. 247, 250 (2021).

2. Default. Nagog was only entitled to terminate the lease and pursue damages if Cygilant in fact defaulted on the lease. On Nagog's motion for summary judgement, the motion judge concluded that Cygilant had defaulted on the lease as a matter of law based on Cygilant's attempted early surrender of the premises.

Now, on appeal, Cygilant presents only one reason that its conduct in abandoning the premises and sending the Vetstein letter did not result in a default.3 Specifically, Cygilant contends that if its conduct amounted to a default, Nagog was obliged to give Cygilant notice and an opportunity to cure.4 However, the motion judge already observed in a memorandum on Cygilant's motion for reconsideration that “Cygilant did not raise this argument in its extensive summary judgment papers.” This argument is therefore waived. Carey v. New England Organ Bank, 446 Mass. 270, 285 (2006), quoting Century Fire & Marine Ins. Corp. v. Bank of New England-Bristol Cty., N.A., 405 Mass. 420, 421 n.2 (1989) (“An issue not raised or argued below may not be argued for the first time on appeal”).

3. Accelerated-rent damages. Nagog appeals the trial judge's decision to award zero dollars in accelerated-rent damages. The applicable standard of review is a significant hurdle in Nagog's path. Because the parties waived jury trial, detailed findings of fact, and detailed conclusions of law, we must uphold the trial judge's decision if “anywhere in the evidence, from whatever source derived, any combination of circumstances could be found from which a reasonable inference could be drawn in favor of” that decision. Motsis, 96 Mass. App. Ct. at 380.5

Nagog terminated the lease and sought accelerated-rent damages under section 17(a) of the lease. That provision required Cygilant to pay “accelerated rent,” or as the lease puts it, “(A) the [present value of the] total Rent that Tenant would have been required to pay for the remainder of the Term ․ minus (B) the then present fair rental value of the Premises for such period [(“fair-value offset”)] ․” (emphasis added). In other words, Nagog was immediately entitled to the present value of what Cygilant owed for the remaining lease term, minus an offset for the present value of what Nagog could fairly be expected to recoup by reletting the premises.

Section 17(a) contrasts with an alternate remedial provision built into the lease: section 17(b). Under section 17(b), Nagog could reclaim the premises without terminating the lease, and then recover damages in the amount of rent owed in the future, “diminished by any net sums thereafter received by Landlord through reletting the Premises during such period.” Thus, where section 17(a) entitled Cygilant to an immediate offset based on the fair value of the premises, regardless of Nagog's mitigation efforts, section 17(b) entitled Cygilant to an eventual offset based on the success of the landlord's mitigation efforts.6 Nagog never invoked section 17(b) prior to filing suit or in the trial court. In fact, in the 2015 notice-of-default letter, Nagog explicitly disclaimed reliance on section 17(b).7

Because Nagog sought accelerated-rent damages under section 17(a), the fair-value offset was a key component of Nagog's affirmative case for damages. Nagog, therefore, had to prove the value of the fair value offset “with reasonable certainty,” as with any component of any damages calculation. See, e.g., Coady v. Wellfleet Marine Corp., 62 Mass. App. Ct. 237, 245 (2004), quoting Agoos Leather Cos. v. American & Foreign Ins. Co., 342 Mass. 603, 608 (1961). Cf. UGI Sunbury LLC v. A Permanent Easement for 1.7575 Acres, 949 F.3d 825, 829, 830, 833-836 (3d Cir. 2020) (vacating and remanding damages award for diminution in value of land where landowner plaintiffs had provided reliable evidence of land value before injury, but not after injury). The fact that the fair value offset inured to Cygilant's benefit rather than Nagog's does not shift the burden to Cygilant. In fact, Nagog's counsel conceded more than once at trial that Nagog had the burden on this issue. It follows that if Nagog failed to prove the value of the offset with reasonable certainty, Nagog failed to show its entitlement to accelerated-rent damages.

Nonetheless, throughout most of this dispute, Nagog's strategy with respect to the fair-value offset was to avoid the subject. For one example, in the 2015 notice-of-default letter, Nagog demanded that Cygilant pay around $430,000 in accelerated rent based solely on the value of the remaining rent due under the lease. For another, much later, Nagog disclosed that Rory Walsh, the real estate agent who had relet the premises, would testify as an expert witness with respect to his efforts to relet the property. Neither Walsh's expert report nor the disclosure addressed the fair-value offset at all, beyond stating, in one sentence, that Nagog “should have reasonably anticipated that it [Nagog] would not receive rent for the period of time that coincided with the actual time it took to lease the space.”

As the trial date approached, Cygilant pressed the point, among others, that Nagog had failed to disclose in discovery what its theory was about how much the fair-value offset was worth. This led to a pair of eve-of-trial depositions in which Nagog sought to plug this potential evidentiary hole. Those depositions largely underscored the problems with Nagog's strategy. One witness testified that he had understood the fair-value offset to be valueless as far back as 2015, and had instructed the other witness accordingly. The other witness testified that he had received no such instruction.

Then came trial. Although Nagog sought to have its expert, Walsh, testify to the fair-value offset, the judge excluded such testimony as beyond Walsh's report provided in discovery. As a result, Nagog essentially was left to argue at trial, based on the testimony of one of its other witnesses, that the fair value offset had no value. Nothing required the trial judge to credit that unreasonable position. Indeed, the witness's testimony on this point was undercut by deposition testimony, and it was arguably contradicted by Nagog's undisputed ability to relet the premises at a slight discount from the per-square-foot rate that Cygilant had paid. In these circumstances, the trial judge readily could have decided that there was not adequate evidence of the fair-value offset's value. And, unable to determine a value for the offset, the trial judge could not fix any particular accelerated-rent damages award.

Nagog nonetheless argues that we can reverse for a variety of reasons. Those reasons are variations on the theme that because the lease said that Nagog was entitled to accelerated-rent damages in the event of a default, once it was determined that Cygilant defaulted, Nagog must be entitled to at least some accelerated-rent damages. However, Nagog cannot sidestep its burden of proof by reiterating Cygilant's liability. The lease did not entitle Nagog to damages; it entitled Nagog to the opportunity to prove that the fair-value offset did not completely offset the net present value of Cygilant's remaining rental payments. Cf. NPS, LLC, 451 Mass. at 423. As described, Nagog put forward little credible evidence on one of the two variables in this formula. Nagog received the opportunity it was entitled to, and simply failed to prove its case.8

To be clear, we acknowledge that there was some evidence to suggest that Nagog in fact suffered some amount of accelerated-rent damages. The evidence suggested that the rental market had softened somewhat, and that the fair-value offset therefore was less than the present value of the rent that Cygilant owed under the lease. Nonetheless, the burden was on Nagog to prove its damages, and especially given the applicable standard of review, we discern no error in the trial judge's decision.

4. Attorney's fees. i. Nagog's fees accrued in the trial court. Section 17(d) of the lease entitles Nagog to recover reasonable expenses, including court costs and attorneys’ fees, incurred in enforcing its rights following Cygilant's default. Pursuant to that provision, Nagog won over $230,000 in fees following trial. Cygilant appeals from that fee award on the grounds that the award is unreasonably disproportionate to the damages Nagog won below. See, e.g., Killeen v. Westban Hotel Venture, LP, 69 Mass. App. Ct. 784, 792 (2007). We affirm.

The trial judge “typically ‘is in the best position to determine how much time was reasonably spent on a case, and the fair value of the attorney's services.’ ” Killeen, 69 Mass. App. Ct. at 790, quoting Fontaine v. Ebtec Corp., 415 Mass. 309, 324 (1993). Thus, we generally review a fee award for abuse of discretion. T. Butera Auburn, LLC v. Williams, 83 Mass. App. Ct. 496, 503 (2013).

However, “[t]o evaluate a fee award, we must have some indication of the court's thought processes and how [the court] structured the award.” T. Butera Auburn, LLC, 83 Mass. App. Ct. at 504, quoting Massachusetts Eye & Ear Infirmary v. QLT Phototherapeutics, Inc., 552 F.3d 47, 74 (1st Cir. 2009). And, when they waived detailed findings, “[t]he parties ․ waive[d] all arguments ․ on appeal that require or depend upon the existence of detailed written findings of fact.” Motsis, 96 Mass. App. Ct. at 379 n.20, quoting Rule 20(8)(b) of the Rules of the Superior Court. Thus, it is doubtful that we can, let alone should, conclude that the trial judge abused her discretion.9

Mindful of that difficulty, we note three facts. First, Nagog did not pursue an award of attorney's fees for trial preparation or the five days spent at trial. Thus, Nagog already recovered less than it might have been entitled to. Second, the trial judge heard (and, we may assume, credited) expert testimony that the case was efficiently staffed by an experienced litigator who charged a below-market rate, and that some percentage of the fees were a natural byproduct of the five-year pendency of the case and the thoroughness of the litigators on both sides. Third, in focusing on Nagog's limited success pursuing its affirmative claims, Cygilant ignores the fact that through much of the litigation, Nagog was also defending against the lease-related claims that Cygilant itself had brought. Under these circumstances, we conclude that Cygilant has not demonstrated that the trial judge abused her discretion in crafting the fee award.10

ii. Nagog's fees accrued on appeal. Nagog requests that we award it appellate costs and attorney's fees. Pursuant to the lease, Nagog is entitled to recover reasonable expenses incurred in enforcing its rights, and such clauses may apply on appeal as well as at trial. Karaa v. Kuk Yim, 86 Mass. App. Ct. 714, 725-726 (2014). Nagog therefore is entitled to recover fees for successfully defending against Cygilant's cross appeal. Nagog is not entitled to fees for the time it spent pursuing its own fruitless appeal.

iii. Cygilant's fees accrued on appeal. Cygilant requests appellate costs and fees on the grounds that Nagog's appeal was frivolous and intended to cause delay. See G. L. c. 211A, § 15; Mass. R. A. P. 25, as appearing in 481 Mass. 1654 (2019). Although we agree that aspects of Nagog's appeal verged on the frivolous, we nonetheless conclude that “[i]nappropriate argument and unsubstantiated statements [have not] infect[ed] [Nagog's] appeal so pervasively as to make it frivolous.” Avery v. Steele, 414 Mass. 450 (1993). We also decline Cygilant's request that we bar Nagog from recovering postjudgment interest through the period of this appeal.

Conclusion. We affirm the judgment.11 Nagog may file its application for partial appellate attorney's fees and costs within fourteen days of the date of this decision, in accordance with Fabre v. Walton, 441 Mass. 9, 10-11 (2004). Cygilant shall then have fourteen days within which to respond.

So ordered.



2.   Nagog also sought, and did not win, common-law damages. Nagog does not challenge that aspect of the decision on appeal.

3.   Cygilant also argues at length that the motion judge erroneously granted summary judgment because he misunderstood another portion of the lease concerning the security deposit, and therefore thought Cygilant had failed to pay April 2015 rent. However, the summary judgment decision does not appear to rest in any significant way on the motion judge's interpretation of the security-deposit provision. Instead, it rests mainly on Cygilant's abandonment of the premises and the Vetstein letter. The motion judge drove the point home in a subsequent memorandum addressing Cygilant's motion for reconsideration, in which he wrote that his “ruling that [Cygilant] breached the lease as a matter of law was limited to one action by [Cygilant], namely its surrender of the premises without obtaining written permission from its landlord as required by the lease.”

4.   Cygilant seems to argue on appeal that the Vetstein letter merely was meant to stake out a negotiating position. However, the appellate record on this issue is inadequate for our review. In particular, Cygilant cites its statement of material facts and deposition testimony contained in the summary judgment appendix, but neither is to be found in any of the parties’ three appendices (the record appendix, supplemental appendix, and appellee appendix). See Chokel v. Genzyme Corp., 449 Mass. 272, 279 (2007) (“When a party fails to include a document in the record appendix, an appellate court is not required to look beyond that appendix to consider the missing document”).

5.   Nagog argues that our review is de novo, because questions of law are involved. This argument assumes the conclusion that Nagog would like us to draw. However, given that the parties waived detailed findings of fact and conclusions of law, we cannot conclude that the trial judge's decision rested on any particular legal (or factual) ground unless there is no other way to understand the decision.

6.   In contrast to damages potentially available under section 17(b), accelerated-rent damages under section 17(a) can be calculated immediately. Thus, section 17(a) in theory could have helped Nagog and Cygilant wrap up their relationship promptly and obviated disputes about Nagog's mitigation efforts. Cf. NPS, LLC. v. Minihane, 451 Mass. 417, 423 (2008), quoting Kelly v. Marx, 428 Mass. 877, 881 (1999) (“When parties agree in advance to a [formula] that represents a reasonable estimate of potential damages, they exchange the opportunity to determine actual damages after a breach, including possible mitigation, for the ‘peace of mind and certainty of result’ afforded by a liquidated damages clause”).

7.   On appeal, for the first time, Nagog argues that the trial judge should have offset Cygilant's remaining rental payments by the amount that Nagog actually received for reletting the premises. We disagree, because this is the remedy Nagog would be entitled to under section 17(b).To escape this straightforward conclusion, Nagog points to provisions in the lease that arguably permit it to pursue remedies under section 17(a) and section 17(b) simultaneously. Regardless of whether Nagog could have invoked section 17(b) in the alternative, the fact remains that it did not. We see no reason to think that the lease terms vitiate ordinary waiver principles. See, e.g., Carey, 446 Mass. at 285, quoting Century Fire & Marine Ins. Corp. 405 Mass. at 421 n.2.

8.   Nagog expends considerable effort arguing that the judge erred in excluding certain testimony by one witness with respect to the value of Cygilant's outstanding payments. Especially where that witness changed his damages calculation following a deposition that was meant to rectify Nagog's previous evasiveness on the subject of damages, the judge did not abuse her discretion in excluding the new calculation. In any event, the issue appears to be moot, because we do not see how it would affect the outcome of this case. Nagog was able to introduce other evidence showing what Nagog contended Cygilant owed, and the central problem with Nagog's affirmative case was the fair-value offset.

9.   This obstacle distinguishes this case from the cases Cygilant primarily relies on. See TAL Fin. Corp. v. CSC Consulting, Inc., 446 Mass. 422, 428 (2006); Killeen, 69 Mass. App. Ct. at 785 n.1, 787.

10.   We note the possibility that the judge, having rejected Nagog's proof of accelerated damages despite evidence suggesting that Nagog may have suffered some such damages, might have been lenient in assessing Nagog's claim for attorney's fees in an effort to supply “rough justice.” Because we can sustain the attorney's fees award on other grounds, we need not consider the propriety of such an effort.

11.   To the extent that any other arguments, such as Cygilant's contention that the Vetstein letter was not “unequivocal” with regard to whether Cygilant was surrendering the premises, have not been explicitly addressed, “they ‘have not been overlooked. We find nothing in them that requires discussion.’ ” Commonwealth v. Brown, 479 Mass. 163, 168 n.3, (2018), quoting Commonwealth v. Domanski, 332 Mass. 66, 78 (1954).

Was this helpful?

Thank you. Your response has been sent.

Copied to clipboard