COMMONWEALTH OF MASSACHUSETTS
SUFFOLK, ss. SUPERIOR COURT
CA No. 15-3649-BLS1
JANE E. TAYLOR, Trustee and Beneficiary of the Jane E. Taylor GST Exempt Trust and the Jane E. Taylor Non-Exempt Trust Derivatively on behalf of COOLIDGE PROPERTIES, LLC and STEARNWOOD PROPERTIES, LLC
JAMES M. MOSKOW, and others
MEMORANDUM OF DECISION AND ORDER ON
DEFENDANTS’ MOTION FOR ATTORNEYS’ FEES, COSTS, AND EXPENSES
This case is before the court on the defendants’ motion for attorneys’ fees, costs, and expenses under G.L. c. 231, § 6F and G.L. c. 156C, § 57. It follows the court’s order dismissing the case, under M.R.Civ.P 56, because it was clear, on the undisputed facts, that the case was filed well after the expiration of the three year statute of limitations governing claims for breach of fiduciary duty. The untimeliness of this action is explained in two prior decisions: (1) the summary judgment decision entered on June 10, 2016 and (2) an earlier decision, entered on February 5, 2016, in which the court dismissed the plaintiff’s complaint with leave to replead, if the plaintiff could address the shortcomings in her complaint after adequate investigation and in good faith.
As described in greater detail in the two prior decisions, this litigation is, in essence, a dispute between Jane Taylor and her brother James Moskow. The parties’ grandfather acquired two apartment buildings in Brookline which were owned, during the period relevant to this case,
by two limited liability companies: Coolidge Properties, LLC and Stearnwood Properties, LLC (the LLCs). Taylor and Moscow came to own interests in these LLCs, over time, both directly and through trusts. Moscow, for some period, was the manager of the LLCs. As expressly permitted by their operating agreements, the LLCs contracted with companies that Moscow owned to provide property management and leasing services. Taylor has, apparently for many years, believed that Moscow’s companies were paid too much for services that they provided to the LLCs; although, the complaints and amended complaints filed in this case never actually allege the basis for Taylor’s belief that payments to Moscow’s companies were not at market rates.
As noted in the prior decisions, this case represents the fourth time that Taylor has sued Moscow over these payments. The prior three cases were filed in Federal Court. All were dismissed because Taylor was suing individually for claims that could only be asserted derivatively on behalf of the LLCs. When the Federal Court litigation was unsuccessful, she filed this case on July 6, 2015; in it she purports to assert her claims derivatively on behalf of the LLCs.
The defendants moved to dismiss on a variety of grounds. Oral argument on that motion was convened on February 3, 2016. At that argument, the court reviewed with Taylor’s counsel many of the apparent shortcomings in her derivative complaint; among them was the fact that the payments from the LLCs to her brother’s companies, which are the subject of her complaint, were made between January, 2009 and November, 2011. Moreover, emails and correspondence between Taylor’s accountant and Moscow, and then Taylor’s attorney and Moscow’s attorney, in December, 2011 and January, 2012, appeared to make clear that Taylor’s concern with the amount of the payments was already very much at issue at that time. These emails and
correspondence demonstrate that Moscow sent bookkeeping ledgers for the LLCs to the accountant in 2011, and Taylor’s attorney (who was then the partner of Taylor’s present counsel of record) was already then aggressively alleging that the LLCs had overpaid for services and demanding more documents. The court expressed its doubt that Taylor’s action was timely filed. It, nonetheless, allowed Taylor to replead, but only if she could, in good faith, allege facts that would support a finding that the cause of action accrued after July 6, 2012.1
Thereafter, Taylor, through her counsel, filed two more amended complaints and an affidavit purportedly addressing the timeliness issue; however none of them contained any factual allegations that, when viewed in the light most favorable to Taylor, could support a finding that her cause of action accrued after January, 2012, if not months earlier. There were also two more hearings at which Taylor’s attorney, in effect, acknowledge that it appeared that the case was untimely, but asked for more time to review documents and speak with his client. The court granted these requests, but repeatedly expressed its concerns regarding Taylor’s good faith in pursuing claims which clearly appeared to be time barred and the time and expense to which Moscow was being put. It warned that filing documents that lacked any factual foundation could lead to sanctions.
Finally, the court dismissed Taylor’s claims. Because the court referenced emails and correspondence to and from Taylor’s lawyer and accountant in December, 2011 and January, 2012, in its decision, the court treated the motion to dismiss as a motion for summary judgment. It issued its memorandum of decision and order on June 10, 2016.
1 The court also expressed its concern that Taylor’s accountants and lawyers had the LLCs’ financial records since late 2011, and there was no evidence that anyone had reviewed them to determine whether the amounts paid her brother’s companies were in excess of the amounts that would have been paid to unrelated parties for management and leasing services.
Although not necessary for the resolution of this motion, the court notes that in August, 2016, represented by new counsel, Taylor moved for leave to file an appeal of the court’s judgment of dismissal more than thirty days after judgment entered. That motion was denied. Taylor then sought relief in the Appeals Court under Mass.R.App.P 14(b), and that was denied, as was a motion for reconsideration of the denial. Taylor has apparently appealed the denial of her Rule 14(b) motion.
This case is a paradigm example of the type of litigation that G.L. c. 231, § 6F was intended to address. The court finds that Taylor’s efforts to continue this action in the face of correspondence and emails between her accountant and lawyer and Moscow (and his attorney), the authenticity of which cannot be challenged, which (a) addressed exactly the same issues as those raised in this litigation, and (b) were exchanged three and one half years before this case was filed, “were wholly insubstantial, frivolous and not advanced in good faith.” See Hahn v. Planning Board of Stoughton, 403 Mass. 332, 337 (1988) (Examples of an absence of good faith are claims that were “interposed for any improper purpose, such as to harass or to cause unnecessary delay or needless increase in the cost of litigation.”)
Moscow notes that, including the Federal Court litigation and counting amended complaints, Taylor has filed eight complaints against Moscow, none of which has survived a motion to dismiss. He asks to recover all of his attorneys’ fees and expenses incurred in connection with this litigation. The court finds that request overbroad.
The Federal Court litigation was never dismissed on its merits, but rather because Taylor was asserting claims in her own name that could only be asserted by the LLCs. It is true that Taylor’s initial Superior Court complaint seemed to assert that it was a breach of fiduciary duty
for Moscow to cause the LLCs to contract with companies affiliated with him, although related party contracts of this kind were expressly permitted by their operating agreements. Nonetheless, inferentially, the complaint also alleged that the fees paid were excessive. Although, it may well be that Taylor had no reasoned basis for believing that, the court clearly cannot make such a finding on the record before it. It dismissed Taylor’s complaint because it was manifestly untimely. The court does not find that filing a complaint six months after the expiry of the period of limitations constitutes a basis to award fees under § 6F.
However, at the February 5, 2016 hearing on the motion to dismiss, the court directed Taylor’s counsel to the fact that the LLC’s payments to the Moscow companies had ended more than three and a half years before this complaint was filed. It appeared that the amount of the payments were already the subject of heated exchanges with Taylor’s accountants and lawyers in December, 2011, and counsel’s former partner appeared already to have the LLCs financial records at that time. In its written decision allowing the motion to dismiss, the first grounds for dismissal (among several others) set out in the decision was the statute of limitations. While granting leave to replead, the court cautioned counsel that Taylor should only file an amended complaint after careful investigation, and if facts supporting a delay in the accrual date of the claim for breach of fiduciary duty could be alleged in good faith. It is clear that Taylor continued to file amended complaints and affidavits seeking to prolong this litigation without any good faith basis for doing so.
Accordingly, all of the attorneys’ fees incurred by Moscow after February 5, 2016, to the date judgment entered dismissing this case, may be recovered. And, the court finds that the time expended and hourly rates shown on the billing records submitted in support of this motion were
reasonable. The court awards $ 45,153.50 to Moscow for fees and expenses incurred for this period.
The court also holds that Moscow may recover the fees and expenses incurred in preparing this § 6F motion. The court finds that the reasoning of Stratos v. Department of Pub. Welfare, 387 Mass. 312, 325 (1982), in which the SJC awarded fees incurred in moving for an award of attorneys’ fee under 42 U.S.C. § 1988, is equally applicable to motions filed under § 6F. See also Haddad v. Wal-Mart Stores, Inc. (No. 2), 455 Mass 1024 (2010) ( Under G.L. c. 151B, § 9, plaintiff was entitled to an award of “reasonable attorney’s fees for work required in order to recover her attorney’s fees.”) The court finds that $ 5,345.00, which does not include hours spent at the hearing on the § 6F motion or in preparing a supplemental memorandum requested by the court, is reasonable.2
Taylor argues that even if a § 6F award were otherwise appropriate, under the circumstances presented by this case, it should be denied as untimely. A final judgment dismissing this case was entered on June 14, 2016 and this § 6F motion was not filed, under Rule 9A, until December 28, 2016, although, it appears that the motion was served on Taylor’s attorney on November 30, 2016.
In Powell v. Stevens, 92 Mass. App. Ct. 87, 92 n.7 (2007), the Appeals Court observed: “[6F] contemplates a separate evidentiary hearing held promptly after the relevant finding, order, verdict, ruling, or judgment, as is inferable from the language of the statute, which, although not requiring the motion to be made within a particular time, does require the judge to state specific facts and reasons on which any finding that the claims were wholly insubstantial, frivolous, and
2 In his motion, Moscow also requested fees incurred in addressing Taylor’s efforts to obtain leave to file a late appeal in the Appeals Court. At oral argument, Moscow’s attorneys acknowledged that such fees could only be awarded by the Appeals Court and withdrew that part of the motion.
not advance in good faith is based. . . . [T]he necessary time for such a hearing procedure comes immediately after the primary event of a verdict, ruling, or order. At that moment, the total circumstances of the case are full and fresh in the mind of the judge. The hearing can proceed efficiently and in continuity with the underlying proceeding. The judge can enter the required findings promptly.” In this case, Moscow waited approximately five months to bring his § 6F motion. In general, this delay appears longer than necessary and not in keeping with the teaching of Powell. However, under the circumstances presented by this case, the delay has neither prejudiced Taylor nor burdened the court. The court will therefore not deny the motion as untimely.
No evidentiary hearing was necessary to rule on this § 6F motion. The evidence establishing that the statute of limitations had run well before the case was filed was documentary: the emails and correspondence generated between December, 2011 and January, 2012, described above. For her part, Taylor provided no countervailing evidence supporting any theory delaying the date on which the claim of breach of fiduciary duty accrued. The court also remembered its admonitions to Taylor’s lawyer about the consequences of prolonging the case without a good faith, factual basis to do so. The court’s memory was aided by Moscow submitting transcripts of the hearings concerning this issue. Finally, during the period August through November, 2016, Moscow was engaged in responding to Taylor’s unsuccessful efforts to obtain leave to file an untimely appeal from this court’s judgment dismissing her case.3
3 Having awarded fees under G.L. c. 231, § 6F, the court has not considered Moscow’s arguments that he is also entitled to fees under G.L. 156C, § 57.
For the foregoing reasons, Defendants’ motion for an award of attorney’s fees, costs and expenses under G.L. c. 231, § 6F is ALLOWED in the amount of $ 50,498.50. Final Judgment for the defendants and against Jane Taylor in that amount shall enter.
Mitchell H. Kaplan
Justice of the Superior Court
Dated: March 10, 2017
COMMONWEALTH OF MASSACHUSETTS
SUFFOLK, ss.SUPERIOR COURT
CHRISTOPHER E. BURNS
HUGH R. TAYLOR and LISA FRANKS
MEMORANDUM OF DECISION AND ORDER ON
DEFENDANTS’ MOTION FOR SUMMARY JUDGMENT
In early 2014, plaintiff Christopher Burns and defendants Hugh Taylorand Lisa Franks formed an investment advisory firm which they called Taylor Wealth Management Partners. Although they planned on entering into a formal written agreement that would define the terms of their business arrangement, they began their joint enterprise before they had agreed upon all of the terms and memorialized their agreement in a written contract. By December 2014, terms of their agreement were still being debated, theparties’ relationship hadsoured,and Taylor, with Franks’ consent and assistance, told Burns that he must leave the firm. Aggrieved by the termination, Burns filedthis action against Taylor and Franks, alleging that their actions constituted a breach of contract and a breach of fiduciary duty. The matter is now before the court on the defendants’ motion for summary judgment. For the reasons that follow, the motion is ALLOWED,in part,and DENIED,in part.
NOTICE: All slip opinions and orders are subject to formal revision and are superseded by the advance sheets and bound volumes of the Official Reports. If you find a typographical error or other formal error, please notify the Reporter of Decisions, Supreme Judicial Court, John Adams Courthouse, 1 Pemberton Square, Suite 2500, Boston, MA, 02108-1750; (617) 557-1030; SJCReporter@sjc.state.ma.us
Suffolk. March 8, 2016. – October 11, 2016.
Present: Gants, C.J., Spina, Cordy, Duffly, Lenk, & Hines, JJ.
Easement. Real Property, Easement. Martha’s Vineyard Land Bank Commission.
Civil action commenced in the Land Court Department on June 9, 2010.
A motion for summary judgment was heard by Alexander H. Sands, III, J., and the remaining issues were also heard by him.
NOTICE: All slip opinions and orders are subject to formal revision and are superseded by the advance sheets and bound volumes of the Official Reports. If you find a typographical error or other formal error, please notify the Reporter of Decisions, Supreme Judicial Court, John Adams Courthouse, 1 Pemberton Square, Suite 2500, Boston, MA 02108-1750; (617) 557-1030; SJCReporter@sjc.state.ma.us
COMMONWEALTH vs. RODRICK JAMES TAYLOR.
Suffolk. December 5, 2013. – August 29, 2014.
Present: Ireland, C.J., Spina, Cordy, Botsford, Gants, Duffly, & Lenk, JJ.
Homicide. Constitutional Law, Speedy trial. Practice, Criminal, Dismissal, Speedy trial, Discovery, Waiver, Argument by prosecutor.
Indictment found and returned in the Superior Court Department on July 28, 2006.
A motion to dismiss for lack of speedy trial was heard by Stephen E. Neel, J., and the case was tried before him; a motion for postconviction relief, filed on April 28, 2011, was heard by Diane M. Kottmyer, J.
The construction at 8-10 Taylor Street will go on, decided the South End Landmarks Commission on Tuesday night.
The wooden home is only one of two in the South End. It has faced controversy in the neighborhood since construction started several weeks ago, had its stop work order lifted after the commission’s review. The stop work order had been imposed due to the homeowner and contractor’s decision to take down an extra wall during the demolition process. That demolished east wall will be rebuilt based on preservation’s standards, the commission decided.
“The mistake was that you didn’t call when the wall had to come down,” said commission chair Christie Gamp. “I can’t believe knowing the contentiousness of this project and the neighbors that that didn’t happen… It’s unbelievable for the neighbors and all we’ve worked for and to feel like we’re blindsided,” said Christie Gamp.
The following were the top articles on South End Patch from Jan. 29 to Feb. 1st, 2013:
The historic wooden house at 8-10 Taylor Street, built in 1899, was approved for renovations by all city agencies, but progress is currently stalled due to neighborhood concerns.
The original stop work order put on the 8-10 Taylor Street wooden house property was because of environmental and project concerns, neighbors say. Now, it’s related to an entirely different issue.
Boston Police arrested a man for allegedly selling heroin on Northampton Street on Monday.
A South End resident is looking for answers about 655 Tremont Street’s tree removal.
After residents reached out to question why several large trees were removed from the Tremont/W.Brookline Street corner, the Boston Parks Department provided its reasoning.
Imagine sitting in your home one morning and feeling the entire floor shake. That’s how Taylor Street resident Louane Hann was notified of the construction happening on her street last Tuesday.
“I was working from home, and all of a sudden, I felt the earth move,” she said. “There was a guy with a backhoe and a guy with a hose, and they were ripping the house down.”
Hann said neither she nor anyone else in the neighborhood was notified that construction would begin at the wooden house at 8-10 Taylor Street, and that it would involve demolition of the building.
“We get notices about someone getting a roof deck you can’t even see half the time, and no one got a notice about this,” she said. “It’s unbelievable.”
Couple the lack of notice with the complete surprise that the building, which neighbors thought had been approved for a renovation and addition, was being completely demolished. And the day of demolition left dust everywhere, debris on neighbors’ porches and properties, and even broke a window at a home next door, said nearby residents.
When Ramy Rizkalla bought his new home on Taylor Street, he knew it’d be a long road to renovation. That’s because the home, which he originally believed was built in the mid-1800s with original ornamentation and features and would be heavily protected by city agencies.
That was before he found out most of what you see on the home today was built in the 1970s.
“None of the windows, none of the ornamentation, none of the mouldings, none of it is original,” Rizkalla said. “All of that was added in the 70s and 80s.”
And therein lies the solution — and the problem. The renovations, which were approved over an 18-month process through the Boston Redevelopment Authority, the Boston Landmarks Commission, and the South End Historical Society, were blocked this week due to neighborhood concerns.
“That’s one of the biggest problems – there really is a substantial misunderstanding of what people are looking at, and what is truly historic,” Rizkalla said. “We have all the necessary approvals but I think there’s been a need for clarification.”