(1) Showstead v. Holzman
(2) Andrade vs. Town of Mashpee (and New Seabury Corporation)
(3) Angel Valle v. William Pietrantonio
(4) The Chelmsford Planning Board v. Elad General Contractors
(5) United National Insurance Company vs. David Parish
(6) Debral Realty v. Marlborough Cooperative Bank
(7) Philip Asack v. Board of Appeals of Westwood
Offer to Purchase – buyer’s Default – Deposit
Where (1) a defendant backed out of a real estate transaction after executing an offer to purchase the plaintiff’s land and (2) the plaintiff now seeks to recover his actual damages, the complaint must be dismissed because the liquidated damages provision in the offer form limits the plaintiff’s recovery to retention of the defendant’s initial $5,000.00 deposit.
“The issue on this motion to dismiss is what is the seller’s remedy where the defendant-buyer defaulted on or before the agreed extended date for paying the second deposit and signing of the purchase and sale agreement. The seller’s complaint alleges that he is entitled to recover his actual damages and that he is not limited to just keeping the original $5,000.00 deposit that the buyer paid with the offer to purchase. As a matter of law this claim cannot be sustained. . .
“. . .Even if the parties had reached an oral agreement on all the terms of the purchase and sale agreement, the expected second deposit never became part of the liquidated damages because the buyer defaulted on or before the July 8 due date for the second deposit. The seller is limited by the liquidated damages clauses to the $5,000.00 deposit because that was the only deposit that had been ‘made’ at the time of the buyer’s default.
“In this case the escrow agent properly paid the $5,000.00 to the seller following the buyer’s default. As a matter of law, the seller cannot recover on his claim for additional damages. Liquidated damages clauses such as these are enforceable under Massachusetts law. . . .The seller is not entitled to a second look to see if his actual damages turn out to be more than the agreed-upon liquidated damages. . .”
Showstead v. Holzman (Lawyers Weekly No. 12-115-04)(Hely, J.)(Norfolk Superior Court) Attorney for the defendant Eugene S. Summers of Summers & Summers .
At most of the real estate closings I attend, one of the most important decisions the buyer must make is whether or not to purchase Owners Title Insurance. After all, hasnt the bank attorney examined the title? Anyway, we wouldnt be closing if there was a title problem, would we? The answer to the first question is yes, the title was examined. The answer to the second question is no, we havent found a title problem, so we are closing. But, it seems that what we anticipate seldom occurs; while what we least expected, generally happens (Disraeli). The very important point to remember is that some title problems may not be researchable and/or recorded at the time you close. The seed of a title problem may lie beneath the surface, only to sprout up after your closing, and reach back to a time which preceded your closing with tendrils to entangle and result in a cloud on your title. This cloud may very well defeat your ownership in the home you thought you owned. A complex title scenario unfolded over some very valuable land in Mashpee, Cape Cod. The land court case of Andrade vs. Town of Mashpee (and New Seabury Corporation) is a true story, but stranger than fiction.
MGL ch. 60 states that any person (or his heirs) having an interest in land taken or sold for nonpayment of taxes may redeem (the land) by paying the amount of the tax title account of the land being redeemed, at any time prior to the filing of a petition for foreclosure. In plain English, this means that Alexanders heirs could get the property back by paying back taxes. What a shock for the present owner (New Seabury Corporation) which had paid a hefty sum to purchase the property.
Since no owner of the property had filed a petition to foreclose all rights of redemption, Alexanders heirs (whoever they may be) had the right to redeem the title to the property by paying the property taxes from the date of the first tax deed (1931) up through the date of decision. New Seabury loses! Alexanders heirs own the land provided they pay back taxes.
The laws of property ownership are convoluted, and sometimes, full of surprises. What a shock to New Seabury to discover they did not own the property. Hopefully they purchased Owners Title Insurance at the time they acquired the property.
Our system of laws has roots in the old English common law, which in turn has roots and expressions in Latin, much of which originated with the Ancient Romans. We've all heard the expression 'Caveat Emptor'- let the buyer beware. 'Cave Cane' is another old expression which has not found its way in to everyday speech. Translated, it means Beware of Dog. A dog to beware of formed the basis for the case of Angel Valle v. William Pietrantonio.
What's friendship worth anyway when big money may be involved? This ain't about money. Well, we didn't believe Mo Vaughn and we certainly don't believe Angel's mother. As you may have guessed dog bite plus homeowner's insurance equals litigation.
Massachusetts has a dog bite statute which makes the homeowner strictly liable to the non- trespasser who gets bit by a misbehaving pooch. The home/dog owner has a defense if the victim is a trespasser or was in some way antagonizing the dog. In this case, William claimed that Angel was a trespasser and that he had been instructed to always call ahead if he planned to visit. Of course Angel had no recollection of the warning, in fact he testified he was a constant visitor at the home and had never been advised to call ahead. Angel cited the 1900 case of Riley v. Harris, which stated "it has been held that entry upon (another's property) at usual and reasonable hours, and in a customary manner, for any and all common purposes of life, can not be regarded as a trespass."
Angel wins, Angel recovers damages. He was not a trespasser and was not teasing the dog.
Homeowners/Dog Owners - Make sure your homeowners insurance covers your dog. Some breeds are excluded.
In 1910, President Teddy Roosevelt stated "Every man holds his property subject to the general right of the community to regulate its use to whatever degree the public welfare may require it." Everyone of us has an impact on the quality of our environment. The zealous overbuilding of vacant land diminishes everyone's quality of life. As the globe's population gallups upwards, faster and faster, our precious open space is constantly challenged. Zoning laws are an attempt to balance the rights of the landowner with the environmental interests of the community. In the matter of The Chelmsford Planning Board vs. Elad General Contractors, the interests of the developer clashed with the Zoning Code of the Town of Chelmsford.
The Court pointed out that "no person has a legal right to a variance and they (variances) are to be granted sparingly." Variances may be granted only when all the statutory requirements are satisfied. Briefly, the statute requires the following:
The Superior Court overruled the Zoning Board's three lot approval. Although Elad might earn more money with three lots, it was not a "hardship" to deny his request. Failing to demonstrate a hardship was fatal to the three lot proposal.
The requirements of each and every city and town zoning codes are strictly enforced and only in compelling cases are variances granted and upheld by the court. After all why try to add to overcrowding. Let's give nature a chance, she knows her business better than we do.
Although we may try to "put the blame on mame," sometimes we have no one to blame but ourselves. In the Superior Court case of United National Insurance Company vs. David Parish, James Sarantiskis, the victim of an assault and battery tried to blame the property owner for injuries caused by his attackers.
Although it was proven that (1) the property was poorly illuminated, (2) there were no security measures in place for protection of persons lawfully on the premises, (3) the property was located in a dangerous high crime area, the court considered only whether the policy was written to cover the injury suffered.
The court stated that even though Parish's property management might be construed as negligent, his insurance policy did not cover injuries resulting from an assault and battery. Here was a case of negligence with no insurance coverage. As against the insurance company, Sarantikis loses, he'll have to chase Parish in order to collect his $130,000.00 judgment.
Maybe Sarantikis should have been more careful about who, where and when he chose to visit. Believe it or not, sometimes our injuries are the direct result of our own thoughtless behavior, you can't always "put blame on mame."
Never play cards with a man called "Doc". Never eat at any place called "moms". Never get too close to a sleeping lion just because he isn't roaring. In the Massachusetts Appeals Court case of Debral Realty v. Marlborough Cooperative Bank, the sleeping lion was a mortgage "dragnet clause" that roared surprisingly loud.
The court reviewed the Hastings Street mortgage, more specifically, the "dragnet clause" which stated that the Hastings Street mortgage covered not only Hastings Street, but "all other indebtedness". Clearly the West Main Street mortgage was "other indebtedness".
Debral loses. The failure to pay the West Main Street note triggered the "dragnet clause" in the Hastings Street mortgage. Even though the Hastings Street payments were up to date, the bank could foreclose.
Debral was a second mortgage lender and experienced in the world of mortgages and foreclosure. It is surprising that they would overlook the Hastings mortgage "dragnet clause". That oversight resulted in the loss of a valuable property (Hastings Street) and the cost of a Superior Court trial and an Appeals Court argument. The "dragnet clause" is a sleeping lion, but watch out if it wakes up.
"All things come round to him who will but wait". In 1863, when Longfellow included this bit of philosophy in Tales of the Wayside Inn there was no such thing as a Zoning Code. In 1863, if you owned a lot of land, you had a perfect right to build on it - a house, a building, a barn, etc. But, with the 20th century came zoning, which controlled what you could build, where, and what size. The case of Philip Asack v. Board of Appeals of Westwood demonstrated that in the world of zoning, all things (don't) come round to him who waits too long.
Email Summers & Summers at email@example.com
Copyright © 2000-2007 Summers & Summers. All rights reserved.
This site developed and hosted by the Social Law Library of Boston, Massachusetts.