Bickford's Family Restaurants, Inc. v. Waltham Ventures, LLC.

NOTICE: Summary decisions issued by the Appeals Court pursuant to M.A.C. Rule
23.0, as appearing in 97 Mass. App. Ct. 1017 (2020) (formerly known as rule 1:28,
as amended by 73 Mass. App. Ct. 1001 [2009]), are primarily directed to the parties
and, therefore, may not fully address the facts of the case or the panel's
decisional rationale. Moreover, such decisions are not circulated to the entire
court and, therefore, represent only the views of the panel that decided the case.
A summary decision pursuant to rule 23.0 or rule 1:28 issued after February 25,
2008, may be cited for its persuasive value but, because of the limitations noted
above, not as binding precedent. See Chace v. Curran, 71 Mass. App. Ct. 258, 260
n.4 (2008).

§§ COMMONWEALTH OF MASSACHUSETTS

APPEALS COURT

22-P-6

BICKFORD'S FAMILY RESTAURANTS, INC.

vs.

WALTHAM VENTURES, LLC.

MEMORANDUM AND ORDER PURSUANT TO RULE 23.0

This case arises from a real estate contract dispute. The

plaintiff, Bickford's Family Restaurants, Inc., which operated a

restaurant in Waltham, assigned the purchase option in its

commercial lease1 to the defendant, Waltham Ventures, LLC. In

addition to other consideration, the defendant agreed to a

deferred payment2 in the amount of $200,000, less credits,

subject to conditions discussed infra. Three years later, after

an inquiry by the plaintiff regarding status of the deferred

payment, the defendant stated its belief that, per the terms of

the parties' written agreement (contract), it did not owe the

1 The original lease was between the plaintiff and an entity
named DPS Waltham Development, LLC, which is not a party to this
appeal.
2 The deferred payment was, at times, referred to as a "kicker"

payment.
deferred payment because it had refinanced a loan secured by the

property without netting any funds in excess of the payoff

balance. The plaintiff sued, seeking enforcement of the

deferred payment clause and damages under G. L. c. 93A. A

Superior Court judge granted summary judgment in favor of the

plaintiff on the breach of contract claim and permitted the

c. 93A claim to proceed to trial. After a bench trial, a

different Superior Court judge found for the defendant on the

c. 93A claim and ordered the plaintiff to pay fees and costs.

Both parties cross-appealed. Discerning no error, we affirm.

Discussion. 1. Summary judgment. On appeal, the

defendant argues that the motion judge should not have granted

summary judgment to the plaintiff as to the breach of contract

claim because (1) the language of the contract unambiguously

supported the defendant's position and (2) summary judgment was

inappropriate insofar as the judge had concluded that certain

provisions of the contract conflict. We are not persuaded.

"Our review of a motion judge's decision on summary

judgment is de novo, because we examine the same record and

decide the same questions of law." G4S Tech. LLC v.

Massachusetts Tech. Park Corp., 479 Mass. 721, 730 (2018),

quoting Kiribati Seafood Co. v. Dechert LLP, 478 Mass. 111, 116

(2017). "The standard of review of a grant of summary judgment

is whether, viewing the evidence in the light most favorable to

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the nonmoving party, all material facts have been established

and the moving party is entitled to judgment as a matter of

law." G4S Tech. LLC, supra, quoting Casseus v. Eastern Bus Co.,

478 Mass. 786, 792 (2018).

"A contract is a promise or a set of promises for the

breach of which the law gives a remedy, or the performance of

which the law in some way recognizes as a duty." Sea Breeze

Estates, LLC v. Jarema, 94 Mass. App. Ct. 210, 215 (2018),

quoting I & R Mechanical, Inc. v. Hazelton Mfg. Co., 62 Mass.

App. Ct. 452, 454 (2004). "When contract language is

unambiguous, it must be construed according to its plain

meaning." Balles v. Babcock Power Inc., 476 Mass. 565, 571

(2017). "To determine whether the language at issue is

ambiguous, we look both to the contested language and to the

text of the contract as a whole." Id. at 572.

Here, we agree with the motion judge that the language of

paragraph 22 of the contract unambiguously supports summary

judgment in the plaintiff's favor. Paragraph 22 of the contract

states in full:

"Upon the earlier of (a) the third anniversary of the
Closing, or (b) the occurrence of a Capital Transaction,
Buyer shall pay Seller the Deferred Payment in the amount
of Two Hundred Thousand Dollars ($200,000.00), less credits
due to Buyer for (x) one-half (1/2) of the first six Non-
refundable Option Payments made hereunder, and (y) any
payments made by Buyer on account of Seller's failure to
perform its obligations hereunder, including the Lease. As
used herein, the term "Capital Transaction" shall mean the

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Buyer's sale of all, or substantially all of its interest
in the Property, either directly or [through] a transfer of
a membership interest in Buyer or a financing transaction
resulting in the recording of a mortgage or other security
instrument against the Property after completion of the
initial construction of the Project[], where such financing
transaction pays Buyer a net amount of $1,000,000.00 or
more over the payoff balance of the existing mortgage. If
the net amount received by Buyer is less th[a]n
$1,000,000.00 then the Deferred Payment amount required to
be paid at the time of the financing transaction shall be
reduced proportionately by the ratio of net amount received
by Buyer divided by $1,000,000. This obligation shall
survive the closing."

The plain language of this paragraph indicates that, given

the parties' agreement that no sale of the property has occurred

and that three years have passed since the defendant closed on

the property, the defendant must show, at a minimum, a genuine

issue of material fact regarding whether a new mortgage or

security had been recorded against the property in order to

avoid summary judgment on the claim of breach of contract. See

Sea Breeze Estates, LLC, 94 Mass. App. Ct. at 215. It has

failed to do so. See id. at 216-218 (summary judgment

appropriate where party fails to show genuine issue of material

fact regarding contract terms).

Paragraph 22 defines a "capital transaction" as, inter

alia, "a financing transaction resulting in the recording of a

mortgage or other security instrument." The undisputed record

reflects that the defendant's April 10, 2014 agreement with RBS

Citizens, N.A., titled "Amendment to Construction Mortgage,

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Assignment of Leases and Security Agreement and Other Loan

Documents," was an amendment of the existing mortgage between

those parties, rather than a new mortgage. Indeed, the

defendant concedes as much in its brief. Because the amendment

did not result in the recording of a new mortgage or other

security instrument, it was not a capital transaction as defined

by paragraph 22. Therefore, the defendant's failure to generate

any additional funds through the refinancing and amendment of

its existing mortgage did not eliminate its obligation to make

the deferred payment.

The defendant further argues that summary judgment was

improper because the judge concluded that certain provisions of

paragraph 22 in the contract conflict and there was a factual

dispute as to the evidence necessary to harmonize that conflict.

We are not convinced. See G4S Tech. LLC, 479 Mass. at 730.

Assuming without deciding that any conflict in the plain meaning

of the contract language exists, such a conflict only deals with

the extent to which the payment would be reduced in the event

that a capital transaction occurred.3 The plain language of the

contract, however, shows that a capital transaction did not

occur, meaning that any reduction of payment in the event of

such an occurrence is immaterial to the grant or denial of a

3 The defendant has not explicitly identified any other conflict
in its brief before this panel.

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motion for summary judgment. See Balles, 476 Mass. at 571. See

also G4S Tech. LLC, 479 Mass. at 730.

2. Chapter 93A. On cross appeal, the plaintiff argues

that the trial judge's findings do not support his decision to

award judgment to the defendant on the c. 93A claim. We

disagree.

"General Laws c. 93A, § 11, prohibits unfair or deceptive

acts or practices among those engaged in trade or commerce."

Diamond Crystal Brands, Inc. v. Backleaf, LLC, 60 Mass. App. Ct.

502, 506-507 (2004), citing Anthony's Pier Four, Inc. v. HBC

Assocs., 411 Mass 451, 474 (1991). "Not every breach of

contract constitutes a violation of G. L. c. 93A, but a knowing

violation of contractual obligations for the purpose of securing

unwarranted benefits does" (citation omitted). Diamond Crystal

Brands, Inc., supra at 507. "Courts must consider whether the

nature, purpose, and effect of the challenged conduct is

coercive or extortionate." Id., citing Massachusetts Employers

Ins. Exch. v. Propac-Mass, Inc., 420 Mass. 39, 42-43 (1995).

"The standard of review is well established. The findings

of fact of the judge are accepted unless they are clearly

erroneous. We review the judge's legal conclusions de novo"

(citation omitted). T.W. Nickerson, Inc. v. Fleet Nat'l Bank,

456 Mass. 562, 569 (2010). "In an action alleging violations of

G. L. c. 93A, 'whether a particular set of acts, in their

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factual setting, is unfair or deceptive is a question of fact.'"

H1 Lincoln, Inc. v. South Washington St., LLC, 489 Mass. 1, 13-

14 (2022), quoting Casavant v. Norwegian Cruise Line Ltd., 460

Mass. 500, 503 (2011). "But whether conduct found to be unfair

or deceptive 'rises to the level of a chapter 93A violation is a

question of law.'" H1 Lincoln, Inc., supra at 14, quoting Baker

v. Goldman, Sachs & Co., 771 F.3d 37, 49 (1st Cir. 2014).

Here, the plaintiff does not contest the trial judge's

findings of fact. Instead, it argues that the facts found by

the judge require a finding that the defendant's actions

constituted a violation of c. 93A. We disagree. Admittedly,

the trial judge was highly condemnatory of the defendant's

conduct. He stated, among other things, that the defendant's

manager had made "a significant error in understanding the

contract," that the manager's position on the dispute was

"extremely weak," that "[h]is interpretation of the contract was

baseless," that his signing the contract while "not

understanding a key provision" was "unreasonable" and that

"[h]is refusal to pay was also unreasonable." The judge further

found that "[t]hese unreasonable positions were adopted after

[the manager] realized his error [in misunderstanding the

agreement]." However, the trial judge explicitly rejected the

plaintiff's request for findings that the manager's actions were

"extortionate in intent and effect" and that the defendant

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"simply did not want to pay [the plaintiff] and came up with an

excuse to justify avoiding its contractual obligations."

Furthermore, the judge found that the manager's "understanding

of the contractual agreement was that he would not have to pay a

'kicker' or bonus to the plaintiff if it took him longer than

three years to make a big profit," and that the manager "entered

into a written contract contrary to what he thought he was

agreeing to."

Taken together, these findings show that, while

unreasonable, the defendant's behavior was the result of an

honest disagreement about the terms of the contractual

obligations. However incompetent, the defendant's conduct was

nothing more than the product of genuine misunderstanding as to

the meaning and effect of paragraph 22. Without more, we cannot

conclude that the defendant's conduct constituted a violation of

c. 93A. See Diamond Crystal Brands, Inc., 60 Mass. App. Ct. at

507.

3. Fees. Declining to reverse the trial judge's ruling

with respect to the c. 93A claim, we further decline to vacate

the attorney's fees awarded to the defendant for costs incurred

in its defense of the plaintiff's c. 93A claim. Under paragraph

26 (d) of the contract, the "prevailing party" in any litigation

arising under the agreement "shall be awarded its costs

including reasonable attorney's fees." The defendant is the

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"prevailing party" as to the c. 93A claim.4,5 See Northern

Assocs. v. Kiley, 57 Mass. App. Ct. 874, 880-881 (2003), quoting

Bardon Trimount, Inc. v. Guyott, 49 Mass. App Ct. 764, 778-780

(2000) ("litigant in whose favor judgment enters is 'prevailing

party'"). We decline to award attorney's fees to either party

for costs associated with this appeal.

Judgment affirmed.

By the Court (Neyman,
Desmond & Grant, JJ.6),

Clerk

Entered: May 24, 2023.

4 We are unpersuaded by the plaintiff's argument that it is the
prevailing party because it succeeded on the "ultimate issue" of
the breach of contract claim. The underlying suit consisted of
two separate claims, breach of contract and violation of c. 93A,
and the defendant prevailed on the latter claim. See Northern
Assocs., 57 Mass. App. Ct. at 880-881.
5 We likewise reject the plaintiff's argument that the judge

erred in finding that the c. 93A claim "arose from the terms of
the agreement." Where the plaintiff's complaint alleged that
the defendant violated c. 93A by, inter alia, "refusing to
tender the deferred payment," "ignoring the plain meaning of
Paragraph 22 of the Assignment," and ultimately "engag[ing] in
conduct in disregard of known contractual arrangements," we
conclude that the c. 93A claim constitutes "any litigation
arising under the terms of this Agreement" pursuant to paragraph
26 (d). Contrast Hannon v. Original Gunite Aquatech Pools,
Inc., 385 Mass. 813, 828 (1982) (contract provision entitled
prevailing party to attorney's fees "in an action brought to
determine or enforce rights under the contract").
6 The panelists are listed in order of seniority.

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