53 F. Supp. 3d 267
D. Mass.2014Background
- In 2006 Link Development (Link) obtained a mortgage on a 22‑acre Saugus property that was later discovered to have been executed without corporate authority by attorney Stuart Sojcher; BD Lending recorded a 2006 mortgage (BD Mortgage) and foreclosed after Link defaulted.
- RFF loaned Link $1.4 million in 2007, took a first mortgage (RFF Mortgage), foreclosed in 2010, and bought the property at auction; RFF later sued BD Lending and Link in 2011 (2011 Federal Case).
- On the eve of the 2011 trial, BD Lending and RFF entered a confidential settlement (2012 RFF Settlement) under which BD Lending agreed to discharge the BD Mortgage in exchange for $140,000; BD Lending later refused to discharge and RFF moved to enforce the settlement.
- Also on the eve of trial Link and BD Lending settled a separate dispute (2012 Link Settlement): BD Lending agreed to pay Link $450,000 up front and $650,000 later and delivered an assignment of the BD Mortgage to be held in escrow and recorded only upon BD Lending’s default; Link later recorded that assignment in December 2012.
- Litigation followed in 2013–2014: RFF moved for contempt for BD Lending’s failure to discharge the mortgage; BD Lending blamed Link’s December 2012 recording and filed cross-claims in a new 2014 action; extensive summary‑judgment and discovery motions ensued.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether BD Lending must comply with the 2012 RFF Settlement / contempt | RFF: Settlement is valid; BD Lending agreed to discharge mortgage and must comply | BD Lending: Performance impossible because Link recorded the assignment and will not reassign it | Court: RFF's motion for contempt allowed; BD Lending not excused by claimed impossibility or need to negotiate with Link |
| Whether RFF's 2014 slander‑of‑title and declaratory claims against Link are time‑barred | RFF: Claims are based on Link’s December 6, 2012 recording, within 3‑year limitations | Link: Claim accrues from 2006/2007 mortgage knowledge; statute has run | Court: Claims against Link based on December 2012 recording are timely; motion to dismiss denied on statute grounds |
| Whether RFF pleaded special damages for slander of title | RFF: Alleged impairment of vendibility and legal fees constitute special damages | Link: No specific identifiable customers or direct pecuniary loss alleged | Court: RFF adequately alleged special damages (attorney fees/impairment of vendibility) |
| Whether BD Mortgage validity can be adjudicated / estoppel re: mortgage validity | RFF: Seeks declaratory judgment that BD Mortgage is void for lack of Sojcher authority | Link: RFF previously acted as if mortgage were valid; judicial estoppel prevents RFF from denying validity | Court: Denied RFF summary judgment on mortgage invalidity; instead granted partial summary judgment for Link — RFF estopped from denying BD Mortgage validity; Counts I and IV dismissed |
Key Cases Cited
- Mesnick v. Gen. Elec. Co., 950 F.2d 816 (1st Cir. 1991) (summary judgment helps assess need for trial)
- Anderson v. Liberty Lobby, Inc., 477 U.S. 242 (U.S. 1986) (standard for assessing genuine issues of material fact)
- O’Connor v. Steeves, 994 F.2d 905 (1st Cir. 1993) (view record in light most favorable to nonmoving party)
- Roman Catholic Bishop of Springfield v. City of Springfield, 724 F.3d 78 (1st Cir. 2013) (approach to cross‑motions for summary judgment)
- Chase Precast Corp. v. John J. Paonessa Co., Inc., 409 Mass. 371 (Mass. 1991) (foreseeability limits impossibility defense in contract performance)
- HipSaver, Inc. v. Kiel, 464 Mass. 517 (Mass. 2013) (special damages requirement for slander of title)
- CMI Assocs., LLC v. Reg’l Fin. Co., LLC, 775 F. Supp. 2d 281 (D. Mass. 2011) (mental state requirement for slander of title)
- Banco do Brasil, S.A. v. 275 Washington St. Corp., 889 F. Supp. 2d 178 (D. Mass. 2012) (court may grant summary judgment sua sponte with notice)