907 F. Supp. 2d 155
D. Mass.2012Background
- Disputes concern BD Lending’s 2006 hard-money loan to Link and the related BD Lending mortgage on the Property; authority of Sojcher to bind Link is disputed.
- RFF loaned 1.4M to Link in 2007 secured by a mortgage; alleged oral forbearance with 10% profits and $180,000 escrowed funds is contested.
- Rescue LLC was formed in June 2008 purportedly to hold the 10% interest from the forbearance; Karll’s authority and Kirby’s role are disputed.
- Link foreclosed in 2010 after nonpayment, with RFF seeking deficiency and related claims; preliminary injunction barred certain transfers.
- Motions for summary judgment and contempt were briefed: Link seeks relief on Count V and related issues; RFF seeks declaratory and other relief; contempt sought Tamimi’s deposition.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Authority to bind Link for BD Loan | BD Lending: Sojcher had apparent authority; filings showed Link’s consent. | Link: Sojcher lacked actual/apparent authority; only Tamimi could authorize amendments. | There is a genuine issue of fact whether Fadili ratified, so summary judgment on authority is not warranted. |
| Existence/enforceability of oral forbearance | RFF: forbearance not proven; no enforceable oral modification. | Link: forbearance existed via Rescue LLC and ongoing communications. | Summary judgment denied on enforceability; material facts remain disputed. |
| Standing and scope of Link’s counterclaims | RFF contends Link lacks standing after assignment; claims lack basis. | Link remains real party in interest; counterclaims may be viable. | Standing denied as a matter of law but counterclaims survive for trial; issue of the forbearance remains factual. |
| Deficiency claim and related mortgage issues | RFF seeks deficiency and argues proceeds under Chapter 183 §27; may exceed safe limits. | Link argues no deficiency due to foreclosure price and usury considerations. | Court allowed Link’s Count V for deficiency to proceed to extent supported; however, several key questions remain material. |
Key Cases Cited
- Johnson v. Gordon, 409 F.3d 12 (1st Cir. 2005) (summary judgment standard; piercing pleadings through record)
- Anderson v. Liberty Lobby, Inc., 477 U.S. 242 (U.S. 1986) (material facts must be genuinely in dispute; summary judgment standard)
- Celotex Corp. v. Catrett, 477 U.S. 317 (U.S. 1986) (burden shifting on summary judgment)
- Theos & Sons, Inc. v. Mack Trucks, Inc., 431 Mass. 736, 729 N.E.2d 1113 (Mass. 2000) (apparent authority and agency principles in Massachusetts)
- Linkage Corp. v. Trustees of Boston Univ., 425 Mass. 1, 679 N.E.2d 191 (Mass. 1997) (agency/ratification; apparent agency principles in Massachusetts)
- Teradyne, Inc. v. Mostek Corp., 797 F.2d 43 (1st Cir. 1986) (preliminary injunction standards and equitable relief)
- Berman v. B.C. Associates, Inc., 219 F.3d 48 (1st Cir. 2000) (usury and interest rate considerations; simple vs compound interest)
- FAMM Steel, Inc. v. Sovereign Bank, 571 F.3d 93 (1st Cir. 2009) (fiduciary duty considerations in lender-borrower context)