LOHEAC v. ALDEBORGH (2021)

MEMORANDUM AND ORDER PURSUANT TO RULE 23.0

The plaintiffs appeal from so much of a Superior Court judgment that dismissed under Mass. R. Civ. P. 12 (b) (6), 365 Mass. 754 (1974), count VII of their complaint, alleging a violation of G. L. c. 93A, § 11. As an initial matter, contrary to the argument of the defendants, the notice of appeal in this case was timely filed. Following the entry of judgment, the plaintiffs filed a motion for reconsideration, or, in the alternative, to alter or amend the judgment, pursuant to Mass. R. Civ. P. 59 (e) and 60 (b), 365 Mass. 827-828 (1974), which was served on the defendants within ten days of the judgment. The notice of appeal from the judgment, therefore, was not due until that motion was disposed of and had to be filed within thirty days of that date. Mass. R. A. P. 4 (a) (2) (C), as appearing in 481 Mass. 1607 (2019). That motion was denied on October 24, 2019, and the plaintiffs filed the notice of appeal within thirty days of that date.⁴

Turning to the merits, in an appeal challenging the allowance of a motion to dismiss under Rule 12 (b) (6), we must accept all allegations in the complaint as true and draw all reasonable inferences therefrom in the light most favorable to the non-moving party, here the plaintiffs. See Curtis v. Herb Chambers I-95, Inc., 458 Mass. 674, 676 (2011). Our review of a dismissal under Rule 12 (b) (6) is de novo. Id.

The complaint alleged that the plaintiff, Loheac, engaged the services of the defendant, Aldeborgh, managing broker and realtor for the defendant, Homes on Martha's Vineyard, LLC, to act as her exclusive buyer's broker with respect to the purchase of a vacation rental investment property in the general area of Edgartown. Aldeborgh is licensed by the Commonwealth of Massachusetts Board of Registration of Real Estate Brokers and Salespersons as a broker and a salesperson. He is alleged to have held himself out as a licensed broker, and represented that he possessed the requisite knowledge, training, and experience to help Loheac in selecting and purchasing an investment property.

After viewing a furnished property (the property), Loheac made a written offer for its purchase. Loheac, Aldeborgh, and the seller's broker discussed when viewing the property whether the furniture then in the house would be included in the sale.

The offer was rejected as too low, but Aldeborgh continued to negotiate with the seller's broker on behalf of Loheac. The complaint alleged that Loheac told Aldeborgh that she would increase the price of the offer, but that she wanted the furniture in the house included as part of the sale. She communicated clearly to Aldeborgh that the inclusion of the furniture was an important element of the purchase because she wanted the property to be immediately available for use by guests and/or paying renters.

Aldeborgh knew of the terms Loheac sought and knew that the inclusion of the furniture was an essential part of Loheac's willingness to purchase the property. That the inclusion of the furniture was an essential, material part of the purchase of the property was discussed between Loheac and Aldeborgh on several occasions during the negotiations.

The complaint alleged upon information and belief that on Saturday, April 22, 2017, the negotiations concluded with an agreement to increase the purchase price to $2,125,000 and to include in the sale the furnishings that had been in the home when it was viewed as part of the sale. The two brokers agreed that Aldeborgh would write up the offer based on the agreed terms.

On that date, Loheac received a call from Aldeborgh confirming the terms of the agreement, including the inclusion of the furniture. Loheac more than once during the conversation asked Aldeborgh to confirm that the furniture was included because of its materiality to her decision to purchase, and Aldeborgh confirmed it. Aldeborgh also told Loheac that he would fill out the contract to purchase based on the agreement and that he would email it to her.

That day, he emailed a “contract to purchase” to Loheac, but in it he failed to include the term that the furniture would be included. The contract to purchase required the payment of a $1,000 deposit at the time of signing. Loheac signed the contract to purchase sent to her by Aldeborgh, Aldeborgh transmitted it the broker for the seller, and that broker in turn transmitted it to the sellers, who accepted it. The contract required the signing of a purchase and sale agreement seventeen days later.

As the date for signing the purchase and sale agreement neared, Loheac discovered through counsel that in the terms of the purchase and sale agreement, the sellers would not include the furniture along with the house. The sellers' position was that the contract to purchase did not include that as a term, and therefore, they would not include it in the purchase and sale agreement.

Despite this, on May 8, 2017, Loheac decided to execute the purchase and sale agreement. On June 7, 2017, Loheac, through her counsel, filed a certificate of organization for LTA, LLC with the Secretary of the Commonwealth, listing Loheac as a resident agent and person authorized to execute documents on behalf of the LLC. According to its certificate of organization, the business of LTA, LLC is “to engage in the investment in, and ownership and development of, real estate.” On June 30, 2017, Loheac purchased the property for the $2,125,000 price contained in the contract to purchase and had LTA, LLC take title to the property. At closing, the house did not contain the original furniture that had been in the house at the time of the viewing.

Eventually, Loheac and LTA, LLC brought this action alleging fraudulent inducement, negligent misrepresentation, negligence, breach of fiduciary duty, breach of contract, breach of covenant of good faith and fair dealing, and violation of G. L. c. 93A. The judge dismissed only count VII, the 93A count, on the merits.⁵ She explained, “the plaintiff was aware that furniture was not included before she signed the Purchase and Sale Agreement. She then chose to purchase the property.”

The plaintiffs allege three unfair or deceptive acts by the defendants: (a) misrepresenting to Loheac the sellers' intentions regarding the property, (b) misrepresenting to Loheac the contents of the contract to purchase (and thus failing to disclose that the contract to purchase did not contain all of the terms Loheac had made clear to Aldeborgh), and (c) failing to follow Loheac's explicit instructions regarding the contents of the contract to purchase. Even if the actions of the defendants were merely negligent, something on which we express no opinion, if the plaintiffs were injured by this alleged conduct, it would be a jury question whether the defendants had engaged in an unfair or deceptive act or practice under the statute. See Marram v. Kobrick Offshore Fund, Ltd., 442 Mass. 43, 62 (2004) (“a negligent misrepresentation may be so extreme or egregious as to constitute a violation of G. L. c. 93A, § 11”). The judge did not rule otherwise, ruling only that as a matter of law, no injury flowed from the defendants' alleged acts because the plaintiff Loheac could have refused to consummate the purchase.

This, however, was error. The allegation is that for the purchase price, Loheac could have obtained the house with the relevant furnishings, but that because of the alleged unfair or deceptive acts by the defendants, she was able to obtain only the house. If the case is proven, this would be a cognizable injury. Nor would declining to purchase the house without the furniture have, as the judge seemed to imply, eliminated this cause of action. Without speculating about what the total damages might have been had an unfair or deceptive practice of the defendants led her to lose the purchase of the house entirely, at the very least, as the defendants seem to recognize, she could still have claimed as damages the $1,000 deposit she put down upon signing the contract to purchase.⁶ ,⁷

Accordingly, we vacate the judgment dismissing count VII of the plaintiffs' complaint on the merits, and remand the case for entry of a new judgment dismissing all counts of the plaintiffs' complaint without prejudice to refiling in the District Court.⁸

So ordered.

Vacated and remanded.

FOOTNOTES

4.   In the defendants' brief, counsel also argues that the dismissal should be affirmed on the independent ground that no demand letter was sent prior to commencement of this action. As counsel conceded at oral argument, however, such a letter is required only in cases brought under G. L. c. 93A, § 9, and this is a claim under G. L. c. 93A, § 11.

5.   The judge concluded that the damages sought for the plaintiffs' other counts failed to meet the jurisdictional amount for the Superior Court. See G. L. c. 212, § 3. She dismissed them without prejudice in order to allow the plaintiffs to refile their claims in the District Court. The plaintiffs have not appealed this aspect of her decision.

6.   We express no opinion whether the plaintiffs had a duty to mitigate their damages, nor whether, as the defendants suggest, not going through with the sale would have served to do so, or in what amount, all questions that are not before us.

7.   The defendants' request for attorney's fees and costs is denied.

8.   As the plaintiffs have not appealed from the portions of the judgment dismissing without prejudice the other counts of the complaint on jurisdictional grounds with instructions that they may be refiled in the District Court, we remand with instructions that the Superior Court treat count VII in the same manner, dismissing it without prejudice so that it may be refiled in the District Court.