4 Mass. App. Ct. 821 | Mass. App. Ct. | 1976
A master’s report encompassing both cases was adopted and confirmed by a Superior Court judge. A judgment was entered establishing the individual and several indebtedness of the appellants, Scopa and Switzer, to Aronson, the trustee in bankruptcy of S & S Builders, Inc., an insolvent corporation, and the trustee’s right to reach and apply certain real estate to satisfy that indebtedness. A second judgment established the indebtedness of the corporation to the Winchester National Bank (bank) and the bank’s right to reach and apply the interest of the corporation in the aforementioned real estate. 1. Scopa and Switzer do not contest (a) the corporation’s liability to the bank, or (b) the master’s findings (i) that Scopa and Switzer caused the corporation to violate its fiduciary duty to the bank under four declarations of trust by diverting to the corporation funds held by the corporation in trust for the bank, (ii) that, at all material times, the corporation was insolvent and (iii) that Scopa and Switzer were the corporation’s only stockholders. In these circumstances Scopa’s and Switzer’s personal liability to the corporation is clear. Scott, Trusts, § 326.3, at 2564 (3d ed. 1967). See My Bread Baking Co. v. Cumberland Farms, Inc. 353 Mass. 614 (1968), and cases cited; LiDonni, Inc. v. Hart, 355 Mass. 580, 583 (1969); Commonwealth v. Beneficial Fin. Co. 360 Mass. 188, 289-291 (1971), cert. den. sub nom. Farrell v. Massachusetts, 407 U. S. 910, and sub nom. Beneficial Fin. Co. v. Massachusetts, 407 U. S. 914 (1972). 2. The corporation was entitled to reach the real estate which Scopa and Switzer had conveyed to trustees and to apply it in payment of their indebtedness to the corporation. The master found Scopa and Switzer to be the real and beneficial owners of the real estate and that the trustees, in each instance,
Judgments affirmed.
