RFF FAMILY PARTNERSHIP LP v. SHOPS AT SAUGUS LLC (2026)

MEMORANDUM AND ORDER PURSUANT TO RULE 23.0

The plaintiffs, RFF Family Partnership, LP (RFF), and Saugus Developer, LLC (Developer), brought claims in the Superior Court against the town of Saugus (town) alleging that the town committed a regulatory taking of RFF's property by forcing an abutter, Shops at Saugus, LLC (Shops), as a condition of zoning relief, to enter into a restrictive covenant (mitigation covenant or covenant) by which Shops agreed to never grant any third party access to or egress from the property currently owned by RFF. The plaintiffs sought damages and a declaratory judgment that the mitigation covenant was unenforceable, unconstitutional, and void.

The judge allowed the town's motion for summary judgment and entered judgment declaring that the mitigation covenant granted by Shops to Saugus was lawful, valid, and enforceable, and dismissing the remainder of the plaintiffs’ complaint with prejudice. The plaintiffs appealed from that judgment. Subsequently they moved for reconsideration in the Superior Court, which the judge denied. The plaintiffs appealed again, and the two appeals were consolidated by this court. We affirm.

Background. We recite the facts in the light most favorable to the plaintiffs, the party opposing summary judgment, reserving some facts for later discussion. See Bulwer v. Mount Auburn Hosp., 473 Mass. 672, 680 (2016).

In August 2006, Shops purchased approximately fourteen acres of land in Saugus (Shops property) with the intent to construct a large shopping center. The Shops property had access to Route 1 and abutted twenty-two acres of vacant land to the south (RFF property) owned by Link Development LLC (Link).

The record shows that the RFF property benefitted from two collections of easements. First, a series of contiguous easements (DCR easements) permitted access to Route 1 through the northwest corner of its property. The plaintiffs’ own traffic expert testified at his deposition that there was an existing, permitted driveway through those easements. The issue with the DCR access easements, according to the traffic expert, was that their geometry could not safely accommodate a two-lane driveway sufficient to support a residential development with more than ten units or a commercial use compliant with State Highway Access Permit and Massachusetts Department of Transportation design standards. The plaintiffs’ traffic expert testified that the DCR easements could support unfettered access to the RFF property if RFF were to secure permission from an abutting gasoline station for their driveway to encroach on the abutters’ frontage.

Second, the RFF property benefitted from the rights to a paper street and deeded right of way known as Diamond Street at the easterly or rear portion of the property, with rights continuing along David Drive, a private way, up to the terminus at Eric Drive. However, access to the RFF property via this route (Diamond Street easement) would require the plaintiffs to improve the paper way, and more significantly, to acquire access rights to Eric Drive.

Counsel for Shops, Richard Magnan, filed a petition with the town in March 2006 to rezone a portion of the Shops property from “single family residential” and “business-neighborhood” to “high rise business and industrial.” Magnan's deposition testimony shows that he held public meetings to gather feedback about the proposed rezoning, and he made sure not to go to a final vote until Shops could craft a proposal reasonably certain to satisfy all the town meeting members’ concerns. Some town meeting members expressed their desire for Shops to disallow nightclubs on its property, to implement a larger buffer zone between Shops’ commercial area and the residential neighborhood behind it, and to limit access between Shops and abutting properties because “if all of the traffic [to Route 1] came out of this one [Shops] property, it would create a safety hazard.” Magnan testified that “a dialogue about these concerns ․ [led] to the covenant as a condition of the proposed rezoning.” Magnan drafted a mitigation covenant that addressed all of these concerns.⁴ He sent the draft to the town's counsel, John Vasapolli, without discussing it.

Less than two weeks before the town meeting vote on Shops’ proposal, Magnan submitted a letter to town meeting members outlining the restrictions in the mitigation covenant and informing them that the covenant would be recorded “subject to a favorable vote.”⁵ It is reasonable to infer that town meeting members, when they voted on Shops’ rezoning proposal, understood that they were also voting on whether the restrictions on Shops property in the mitigation covenant would go into effect, including the prevention of future access between the Shops property and the RFF property.

Vasapolli testified in his deposition that although he believed the rezoning would not have passed the town meeting vote without the mitigation covenant, “it was very much voluntary on the part of the developer.” Magnan executed the covenant in November 2006 on the same day the town meeting voted to approve. The covenant was recorded in Shops’ chain of title in May 2007.

RFF purchased the RFF property for $2.5 million in March 2010 at a foreclosure sale after Link defaulted on a loan from RFF, and RFF took title in June 2011. It is undisputed that RFF received the DCR easements and Diamond Street easements through its acquisition of the RFF property. In April 2018, RFF entered into a joint venture agreement with Developer to develop the RFF property into a multi-family residential community and by which Developer was given an option to purchase the property. In December 2019, the plaintiffs reached a land swap agreement with Shops by which RFF would grant a small triangular parcel to Shops from RFF's property and pay Shops $275,000 in return for a perpetual, unrestricted easement granting access to Route 1 through the Shops property.

The plaintiffs and Shops executed that agreement in January 2020. In March 2021, RFF submitted to the Massachusetts Housing Finance Agency (MassHousing) a project eligibility application for a proposed G. L. c. 40B (chapter 40B) project on a sixteen-acre portion of the RFF property. The application proposed to achieve site control via the Shops easement. MassHousing issued a standard request for comments to the town, and the town responded with a letter (no access letter) in May 2021 representing that the “the proposed access arrangement is strictly barred by a recorded Mitigation Covenant entered into between ․ [Shops] and [the town] in 2006” and “the proposed development site is landlocked” such that “the applicant has no colorable claim to access rights ․ and thus lacks site control.” The plaintiffs maintain that they were unaware of the mitigation covenant until after submitting their chapter 40B proposal.

Discussion. 1. Standard of review. We review the grant of summary judgment de novo to determine whether, “viewing the evidence in the light most favorable to the nonmoving party, there is no material issue of fact in dispute and the moving party is entitled to judgment as a matter of law” (quotation and citation omitted). Huang v. Ma, 491 Mass. 235, 239 (2023). We review the denial of a motion for reconsideration for an abuse of discretion. Blake v. Hometown Am. Communities, Inc., 486 Mass. 268, 278 (2020).⁶

2. Regulatory takings claims. The plaintiffs argue that the town's “imposition and acceptance of the mitigation covenant is sufficient government action to support a regulatory taking” for which the plaintiffs are constitutionally entitled to compensation. They contend that the town “extracted concession” from Shops by conditioning rezoning approval on Shops granting the restrictions in the mitigation covenant, and then sought to enforce the covenant, which “render[ed] [RFF's] [p]roperty valueless to RFF” by precluding RFF's chapter 40B development and depriving RFF of its access easement.⁷

A government regulation “goes too far” and becomes a “taking,” entitling a plaintiff to compensation under the Fifth and Fourteenth Amendments and Article 10 of the Massachusetts Declaration of Rights, in any case “where government requires an owner to suffer a permanent physical invasion of her property” or where it “completely deprive[s] an owner of all economically beneficial us[e] of her property” (quotation and citation omitted). Gove v. Zoning Bd. of Appeals of Chatham, 444 Mass. 754, 762 (2005). See Fitchburg Gas & Elec. Light Co. v. Department of Pub. Utils., 467 Mass. 768, 775-776 (2014). Such regulatory actions are known as “per se” takings. Id. at 776. “Outside these two relatively narrow categories ․ regulatory takings challenges are governed by the standards set forth in [Penn Cent. Transp. Co. v. New York City, 438 U.S. 104 (1978)]” (Penn Central) (citation omitted). Gove, 444 Mass. at 761-762. Under Penn Central, supra at 124, courts consider and balance three factors: “the economic impact of the regulation, its interference with reasonable investment-backed expectations, and the character of the government action.” FBT Everett Realty, LLC v. Massachusetts Gaming Comm'n, 489 Mass. 702, 708 (2022) (FBT), quoting Cedar Point Nursery v. Hassid, 594 U.S. 139, 140 (2021).

Here, the plaintiffs asserted claims for regulatory taking under both a per se theory of total deprivation of economically beneficial use and the Penn Central balancing factors. We discuss these claims in turn and conclude that the judge properly entered summary judgment for the town on both.⁸

a. Per se taking. The plaintiffs’ expert appraisal of the RFF property valued the property as of December 2023 at $15.5 million, assuming its highest and best use that it could be approved for chapter 40B development with a 300-unit, multi-family property. The expert who prepared that report opined that “if there was no way to access the site, there would be no value” (emphasis added), but he did not independently assess site access. This opinion is the only evidence the plaintiffs presented to establish the property's purported worthlessness. The record, however, shows that the RFF property was not inaccessible.

There is no dispute that RFF received the DCR easements when it purchased the RFF property and there was a permitted, existing driveway through the easements creating access to Route 1. Although the present state of access may not have allowed the plaintiffs to develop the property for its most profitable uses, the plaintiffs have introduced no evidence to suggest that the existing DCR easements and permitted driveway were unable to accommodate any economically beneficial use of the property. See Palazzolo v. Rhode Island, 533 U.S. 606, 630-631 (2001) (no per se regulatory taking where eighteen-acre property appraised for $3,150,000 had been limited by regulation to use as single residence with $200,000 in development value). See also W.R. Grace & Co.-Conn. v. City Council of Cambridge, 56 Mass. App. Ct. 559, 574 (2002) (Grace) (“It is not impermissible that governmental action precludes the most beneficial use of given property”). Accordingly, the plaintiffs have no reasonable expectation of proving that their property is “economically idle,” Palazzolo, supra at 631, quoting Lucas v. South Carolina Coastal Council, 505 U.S. 1003, 1019 (1992), and the town was entitled to summary judgment on the per se takings claim. See Kourouvacilis v. General Motors Corp., 410 Mass. 706, 716 (1991).

b. Penn Central taking. i. Economic impact. “The extent of the diminution in value caused by a challenged regulation -- the ‘economic impact’ of the regulation -- is a relevant factor in the regulatory takings analysis” (citation omitted). FBT, 489 Mass. at 713.

In addition to the deficiency in the plaintiffs’ evidence of economic impact discussed supra, the plaintiffs’ theory runs into trouble with causation. “[F]or there to be a taking, the owner must satisfy the burden of showing that there has been a negative economic impact as a direct consequence of the government's action.” Grace, 56 Mass. App. Ct. at 573. There is no taking where the diminution in value is the “product of the owner's own activities or decisions,” id., or of a ‘third party's action ․ [unless] ‘the government's influence over the third party was coercive rather than merely persuasive.’ ” FBT, 489 Mass. at 713-714, quoting A & D Auto Sales, Inc. v. United States, 748 F.3d 1142, 1154 (Fed. Cir. 2014).

The plaintiffs’ claims focus exclusively on the Shops easement, but, as we have discussed supra, the record shows that two other potential access routes are material to whether the RFF property was “landlocked”: the DCR easements and the Diamond Street easement.⁹ Not unlike the Shops easement desired by RFF, each of these existing easements would have required RFF to acquire further access rights or permission from certain neighbors to utilize these easements to the extent necessary to support a large commercial or residential development as RFF desired. With these easements, the record shows that the RFF property had substantial value. The town's appraisal expert estimated the value of the sixteen-acre portion of the RFF property, as of July 2024, as $7.54 million assuming only access via the Diamond Street easement, and $9 million with the additional Shops easement.¹⁰

Whereas the plaintiffs claim that the mitigation covenant “landlocked” their property, in fact its practical effect was only to prevent the plaintiffs from bargaining with one of its neighbors, Shops, for access rights. Furthermore, the record is devoid of any evidence to suggest that the plaintiffs attempted to secure access rights to perfect the DCR or Diamond Street easements, let alone that the town coerced the owners of those rights not to sell to the plaintiffs. Absent such evidence, the plaintiffs cannot meet their burden to show that the negative economic impact on the plaintiffs’ property is a “direct consequence” of the town's actions as opposed to the product of private economic activity or the plaintiffs’ choice to focus on the Shops easement as the RFF property's sole source of access. Grace, 56 Mass. App. Ct. at 573.

Another important mitigating consideration in our attribution of negative economic impact to the town is that Shops voluntarily engaged in the rezoning petition and offered the restrictions in the mitigation covenant “in its economic self-interest.” Grace, 56 Mass. App. Ct. at 574. Feedback from town meeting members may have “provided the bait” for Shops to propose the restrictions, “but [Shops] decided to bite.” A & D Auto Sales, Inc., 748 F.3d at 1155, quoting B & G Enters., Ltd. v. United States, 220 F.3d 1318, 1325 (Fed. Cir. 2000).¹¹

We conclude that the first Penn Central factor weighs strongly against the plaintiffs.

ii. Reasonable investment-backed expectations. “A property owner's investment-backed expectations must be reasonable and predicated on existing conditions.” Leonard v. Town of Brimfield, 423 Mass. 152, 155 (1996), citing Ruckelshaus v. Monsanto Co., 467 U.S. 986, 1005 (1984).

Here, RFF commissioned an appraisal of the RFF property in 2009 that described access via the DCR easements and Diamond Street easement. The appraisal opined that developing the Diamond Street easement could provide sufficient access for a single-family development on the rear half of the property, noted “uncertainty and extra level of difficulty in obtaining Route 1 access to the property as well as the [property's] frontage deficiency,” and emphasized that a “proposed land swap [with the abutter] is necessary to gain legal street frontage along Route 1 and improved access from the Route 1 side” sufficient to support “any major development.” Accordingly, prior to RFF's foreclosure purchase of the RFF property in March 2010 for $2.5 million, it had ample notice of the property's obstacles to access and opportunity to investigate the feasibility of the solutions proposed by the 2009 appraisal. Additionally, at that time RFF had not engaged with Shops about acquiring an access easement, and it could not have had a reasonable expectation of obtaining those rights. See Monsanto Co., 467 U.S. at 1005 (“reasonable investment-backed expectation” must be more than a “unilateral expectation or an abstract need” [citation omitted]); General Hosp. Corp. v. Massachusetts Bay Transp. Auth., 423 Mass. 759, 767 (1996) (“Access to a public way is a right of ownership appurtenant to land abutting a public way”). Similarly, there was no agreement by which Link would acquire access rights from Shops prior to RFF's loaning $1.4 million to Link in 2007, and as such the mitigation covenant could not have interfered with RFF's reasonable expectations for that investment.

The plaintiffs also alleged that, after purchasing the Shops easement in January 2020, they invested $475,000 in design, engineering, and permitting. These investments could not support reasonable expectations. The agreement between the plaintiffs and Shops provided that the plaintiffs “shall, at their sole cost and expense, but with the reasonable cooperation of the Shops, obtain and/or modify all permits and approvals previously obtained by Shops in connection with its construction of its shopping center, including ․ the Mitigation Covenant recorded in the Essex South Registry of Deeds in Book 26806, Page 380.” It is undisputed that the plaintiffs executed the agreement with Shops on December 31, 2019, but that no agent, attorney, or representative of the plaintiffs investigated or inquired about the mitigation covenant or any other permit or approval listed in that provision. The mitigation covenant could not interfere with the plaintiffs’ new investment-backed expectations in light of the “well-established and widely recognized principle that offerees have a duty to read the terms of a contract to which they assent.”¹² Good v. Uber Techs., Inc., 494 Mass. 116, 141 (2024).

We conclude that the second Penn Central factor also weighs heavily against the finding of a regulatory taking.

iii. Character of the government action.

“The character of the government action is an important factor because the guiding aim of the regulatory taking inquiry is to ‘identify regulatory actions that are functionally equivalent to the classic taking in which government directly appropriates private property,’ for which compensation is required, and to distinguish such actions from exercises of the police power aimed at protecting ‘public health, public safety, and public morals,’ where compensation is not due” (citations omitted).

FBT, 489 Mass. at 714.

On the one hand, it is arguable that the covenant “unfairly singles out the owner” of the RFF property because no other property is burdened by the mitigation covenants besides Shops, which exchanged its burdens for the benefit of rezoning. See Giovanella v. Conservation Comm'n of Ashland, 447 Mass. 720, 735 (2006).

On the other hand, each of the restrictions in the covenant reflects a facially legitimate concern within the ordinary purview of the town's police power: regulating alcohol consumption, controlling development density (landscaped buffer zone), and improving traffic safety. Such government regulations “limited to mitigating harms or nuisances ․ typically do not require compensation.” Giovanella, 447 Mass. at 735. Moreover, only one of the four restrictions in the covenant affected the RFF property. Viewing the evidence in the light most favorable to the plaintiffs, we accept that the approval of Shops’ rezoning proposal was effectively conditioned on its grant of the mitigation covenant. Even so, “[t]he practice of conditioning otherwise valid zoning enactments on agreements reached between municipalities and landowners that include limitations on the use of their land or other forms of mitigation for the adverse impacts of its development is a commonly accepted tool of modern land use planning.” Durand v. IDC Bellingham, LLC, 440 Mass. 45, 55 (2003). Therefore, the Shops rezoning amendment and the mitigation covenant on which it was conditioned carry a “strong presumption of validity,” id. at 50-51, which the plaintiffs have not rebutted.

On balance, we conclude that the town's role in imposing the mitigation covenant more closely resembles an exercise of police power than a direct appropriation of the RFF property, and this factor also weighs against the finding of a regulatory taking. See FBT, 489 Mass. at 714.

iv. Conclusion under Penn Central. Having determined that all three Penn Central factors weigh against the plaintiffs, we conclude that when viewing the facts in the light most favorable to the plaintiffs, there are no genuine issues of material fact to support the claim that the town effected a regulatory taking of the RFF property under the Penn Central test. Accordingly, the town was entitled to summary judgment on that claim.

3. Declaratory judgment. The plaintiffs argue that the town's acceptance of the mitigation covenant or of the property interest it purported to grant the town required formal acceptance through a town meeting vote, and that the judge therefore erred in declaring the mitigation covenant “lawful, valid and enforceable” where he found that there was no evidence of such formal acceptance.¹³ This argument was raised for the first time in the plaintiffs’ motion for reconsideration.

A motion for reconsideration is not the appropriate place to bring new legal theories that could have been raised prior to the disputed decision, and a judge accordingly has broad discretion not to consider them. See Commissioner of Revenue v. Comcast Corp., 453 Mass. 293, 312 (2009). Here, the plaintiffs could have raised the argument that the mitigation covenant was void or ineffective due to a lack of formal acceptance by the town in their opposition to the town's motion for summary judgment -- although such a theory appears to be incompatible with the premise of their regulatory takings claims that the mitigation covenant “landlocked” the RFF property. They waited to do so until more than three months after the dismissal of their complaint when they sought reconsideration. Accordingly, we conclude that the judge acted within his discretion in determining that the plaintiffs’ motion for reconsideration merely sought “a second bite at the apple” and properly declined to reconsider his prior decision based on the plaintiffs’ new argument (citation omitted). See Blake, 486 Mass. at 278. For purposes of our review of the entry of summary judgment, we therefore treat the argument as waived. See Comcast Corp., 453 Mass. at 312 (argument raised for first time in motion for reconsideration and which motion judge in proper exercise of discretion declines to consider is waived on appeal).

The plaintiffs also contend that because no party requested a declaration that the mitigation covenant was valid and enforceable, the judge's entry of summary judgment “sua sponte on [that] issue [and later refusal to reconsider his decision] ․ violates due process and resulted in prejudice to RFF by depriving it of the opportunity to present any legal or factual argument on the issue.” We disagree.

The declaratory judgment act, G. L. c. 231A, authorizes the Superior Court to make “binding declarations of right, duty, status and other legal relations” when the plaintiff “demonstrate[s] the existence of an actual controversy, as well as the requisite legal standing to secure its resolution” (quotation and citation omitted). Kligler v. Attorney General, 491 Mass. 38, 44 (2022). Where a plaintiff meets those threshold requirements for a declaratory judgment, “the judge must declare the rights of the parties, even when relief is denied, and even on motions for summary judgment” (citations omitted). Molly A. v. Commissioner of Dep't of Mental Retardation, 69 Mass. App. Ct. 267, 288-289 (2007). Accord Buffalo-Water 1, LLC v. Fidelity Real Estate Co., 481 Mass. 13, 20 (2018) (when dismissing complaint seeking declaratory relief for failure to state a claim, judge may make explicit declaration “that the plaintiff is not entitled to the declaratory relief sought based on the allegations in the complaint” or leaving declaration implicit in dismissal).

In this case, there is no dispute on appeal that the complaint presented an actual controversy whether the mitigation covenant effected a regulatory taking, nor that the plaintiffs had standing to seek the resolution of that controversy.¹⁴ Part of the alleged controversy related to the enforceability of the mitigation covenant and specifically to the town's assertion within the no access letter that the plaintiffs’ chapter 40B proposal was “strictly barred” by the covenant. This assertion was premised on the covenant's validity and enforceability. Although the town did not counterclaim for declaratory relief, it repeatedly argued that its involvement in the mitigation covenant was a valid exercise of town authority and the covenant itself was a valid agreement.

As such, any comprehensive declaratory resolution of the rights implicated in the controversy needed to address the validity and enforceability of the mitigation covenant. See G. L. c. 231A, § 9 (purpose of declaratory judgment act is “to remove, and to afford relief from, uncertainty and insecurity with respect to rights․”); Molly A., 69 Mass. App. Ct. at 288-289. Based on our review of the record and the arguments that were properly before the Superior Court, we agree with the judge that the town was entitled to a declaratory judgment that the mitigation covenant is lawful, valid, and enforceable.¹⁵

Judgment affirmed.

Order denying motion for reconsideration affirmed.

By the Court (Desmond, Tan & Wood, JJ.16)

FOOTNOTES

4.   The mitigation covenant provided, in pertinent part, that Shops “agrees that it shall not grant access to or egress from Lot A-34,” the property presently owned by RFF, “to or from [Shops’] Property to any third party.” Shops also agreed to limit access from its own property to Route 1, to maintain a landscaped buffer area on part of its property, and to exclude uses requiring alcohol licenses after 1 A.M. Modification of the covenant required signed approval from Shops and by two-thirds vote of the town meeting, and the covenant was enforceable by the town against Shops.

5.   The covenant provided that it would automatically become null and void if the town meeting did not adopt Shops’ rezoning article.

6.   The plaintiffs argue, citing Shapiro v. City of Worcester, 464 Mass. 261, 266 (2013), that our review of the denial of the motion for reconsideration of summary judgment is de novo. See id. (“Orders on motions ․ for reconsideration of motions for summary judgment are legal conclusions that this court reviews de novo”). As discussed infra, the judge exercised his discretion in finding that that plaintiffs had waived a claim raised for the first time in the motion for reconsideration and that there were no new circumstances that would justify revisiting the grant of summary judgment, and our review is limited to the propriety of that decision. See Commissioner of Revenue v. Comcast Corp., 453 Mass. 293, 312 (2009) (“It was well within the judge's discretion not to consider the [plaintiffs’] new argument on the motion for reconsideration”); Audubon Hill S. Condo Ass'n v. Community Ass'n Underwriters of Am., 82 Mass. App. Ct. 461, 470 (2012) (“a motion for reconsideration calls upon the discretion of the motion judge”).

7.   Because we conclude that there was no taking, we need not decide, for purposes of our review on summary judgment, whether the town's sending of the no access letter was a “final decision” by the town sufficient to ripen the plaintiffs’ takings claims for adjudication.

8.   However, we reach this conclusion for different reasons than the judge. See Gabbidon v. King, 414 Mass. 685, 686 (“It is well established that, on appeal, we may consider any ground apparent on the record that supports the result reached in the lower court”).

9.   These easements predated the recording of the mitigation covenant.

10.   The plaintiffs do not dispute the valuation assuming access via Diamond Street, but they have raised a genuine dispute regarding the report's claim that the plaintiffs already had possessed that right of access.

11.   We are cognizant that the town enjoys the right to enforce the mitigation covenant and that the covenant's effectiveness was conditioned on the town meeting's rezoning approval. See, e.g., Dimare Fresh, Inc. v. United States, 808 F.3d 1301, 1306-1307 (Fed. Cir. 2015) (taking may occur even where government action has no “legal effect” on property interest because “government action may impact property in myriad ways and what is important is the nature or substance of the government's action, as opposed to the precise form it may take”).

12.   The plaintiffs’ allegations that Shops “rushed” them to sign the agreement -- by emailing that “[i]t is imperative that these documents be finalized ASAP ․ kindly forward them ․ at your earliest convenience,” and “repeatedly calling” to get the documents signed -- are insufficient to negate this duty.

13.   The plaintiffs point to the judge's finding that “[t]here is no evidence that Town Meeting or any Town board ever voted to require a covenant barring [easements] across Shops’ Property.”

14.   The town does not press on appeal its previous argument that the plaintiffs lacked standing to assert a takings claim.

15.   We deny the town's request for attorney's fees.