775 F. Supp. 2d 281
D. Mass.2011Background
- Palmer property in Palmer, MA held by Kelly-Foster Realty Trust, with Michaud as sole trustee; Michaud and Petropoulos arranged development financing including Hallinan loan secured by the Palmer property.
- Petropoulos assigned his interest back to the Trust in Sept. 2007, after a 2007 default risk on related mortgages; assignment recorded Nov. 6, 2007.
- Regional Financing and Giuttari brokered multiple refinancings (Hallmarc, Whitehall, Northborough) with Michaud and Petropoulos as guarantors; Giuttari advised refinancing to “clear title.”
- Attorney Tassoni allegedly represented Michaud at the Northborough closing and drafted the Subordination of Execution, which referenced a potential fraudulent conveyance.
- In May 2007, Hardiman obtained a default judgment against Petropoulos and recorded an Execution against the Palmer property; Petropoulos had already assigned his interest, creating a dispute about the Execution’s effect on title.
- Plaintiffs allege the Execution and subsequent Subordination damaged marketability and caused or contributed to foreclosures and inability to sell.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Slander of title elements against Regional and Hallinan | Plaintiffs claim false statements and causation in the Execution and Subordination. | No false statement; execution described Petropoulos’s interest, which at recording time was nonexistent; other elements not satisfied. | Counts I and II dismissed; no liability for slander of title. |
| Wrongful execution claim | Execution caused title damage and liability for improper issuance. | Execution had no effect since Petropoulos had no interest at recording; cannot be wrongful. | Counts VI and VII dismissed. |
| Breach of contract by Regional and Giuttari | Existence of a binding brokerage contract breached by defendants. | No identifiable contractual provision breached; no binding contract shown. | Count III dismissed. |
| Negligent interference with business expectancy | Defendants interfered with Plaintiffs’ prospective sale to Roy and others. | No ongoing relationship with Roy; no improper motive or means shown. | Count V dismissed. |
| Mass. Gen. Laws ch. 93A claim | Unfair trade practices due to clouded title and improper financing. | No viable underlying substantive claims; Chapter 93A not supported. | Count VIII dismissed. |
Key Cases Cited
- Dulgarian v. Stone, 420 Mass. 843 (Mass. 1995) (elements of slander of title; knowledge of falsity required)
- Anderson v. Liberty Lobby, Inc., 477 U.S. 242 (U.S. 1986) (summary judgment standard; evidence burden on nonmovant)
- Brennan v. Hendrigan, 888 F.2d 189 (1st Cir. 1989) (summary judgment standard in First Circuit; need specific facts)
- Rogers v. Barnes, 169 Mass. 179 (Mass. 1897) ( wrongful execution discussion referenced)