442 Mass. 80 | Mass. | 2004
Park Drive Towing, Inc. (Park Drive), a Massachusetts corporation that provided vehicle towing services for law enforcement agencies and the general public, sued the city of Revere (city) and the former chief of police and his successor for breach of contract and unfair or deceptive acts or practices in violation of G. L. c. 93A, § 11. The defendants’ motions for summary judgment were granted by the Superior Court,
The essential facts are not in dispute. At all times relevant to this appeal, the city maintained a “tow list.” This list consisted of three towing companies authorized to perform police-ordered tows of vehicles, for example, towing vehicles that were obstructing snow removal. In return for collecting fees from the towed vehicles’ owners, the towing companies were required to collect from the owner and remit to the city a $15 “administrative fee” for each car towed, provide certain services to city vehicles free of charge (such as jump starts and changing flat tires) and comply with other conditions.
Between September 26, 1996, and October 20, 1998, Park Drive derived approximately $150,000 per year from tows ordered by the city’s police department. To retrieve their towed vehicles, owners paid directly to Park Drive a $75 tow charge, a $20 per day storage fee, and the $15 city administrative fee. Park Drive retained these monies except for the administrative fee, which it remitted to the city.
On October 20, 1998, Park Drive was orally notified of Chief Russo’s decision to suspend Park Drive from the tow list because criminal complaints had been issued against the Lentz brothers.
Park Drive argues that the defendants’ breach of contract occurred when the city summarily suspended Park Drive from its tow list with no notice and without “any procedure in place where a towing company would be entitled to a hearing to present [its] side of the story,” and then refused reinstatement after the criminal charges against the Lentz brothers had been resolved in their favor. These actions, Park Drive asserts, breached the implied covenants of good faith and fair dealing. The defendants rely primarily on G. L. c. 43, § 29, which sets forth requirements for municipal contracts.
It is a well-established principle that a party “dealing with a city or town cannot recover if statutory requirements [such as those contained in G. L. c. 43, § 29,] have not been observed.” Richard D. Kimball Co. v. Medford, 340 Mass. 727, 729 (1960). See United States Leasing Corp. v. Chicopee, 402 Mass. 228, 231 (1988); Quincy v. Brooks-Skinner, Inc., 325 Mass. 406, 412-413 (1950); McGovern v. Boston, 229 Mass. 394, 397 (1918); Lumarose Equip. Corp. v. Springfield, 15 Mass. App. Ct. 517, 519-520 (1983).
The specific requirements here at issue are not “mere ministerial” formalities, see Urban Transp., Inc. v. Mayor of Boston, supra at 697, but rather serve important public purposes. Among other things, they “limit the power of public officials in making contracts . . . so as to unify the control of the city’s commercial transactions” (citations omitted), id., thus “placing cities and towns on a sound financial basis and preventing waste, fraud, and abuse.” United States Leasing Corp. v. Chicopee, supra at 231.
In this case, the requirements of G. L. c. 43, § 29, were not met, and the purposes behind the statute were frustrated. It is undisputed that no written agreement existed and that the requisite written approval was absent.
Park Drive argues, however, that by its own terms G. L. c. 43, § 29, does not apply to this case, because Park Drive’s arrangement with the city was not one “where the amount involved [was] five thousand dollars or more.” Park Drive suggests that we should construe “amount involved” to refer only to cases that involve the “obligation, appropriation, or expenditure of municipal funds.” This reading of the statute would exclude the present situation, because the only money that changed hands between the parties were the administrative fees, which were not expended by the city but paid to the city. We do not agree with Park Drive’s interpretation.
We have stated that such statutes are broadly phrased and are of general application. Adalian Bros. v. Boston, 323 Mass. 629, 631 (1949). See Lumarose Equip. Corp. v. Springfield, supra at 519. Further, the plain language of G. L. c. 43, § 29, simply does not contain the restriction with which Park Drive wishes to burden it. We construe the phrase “amount involved” to be intentionally imprecise, and conclude that it refers to the value to the contractor, no matter the source. This interpretation is consistent with the statute’s general purposes; the public’s interest in the transparency of municipal contracting is no less important simply because money is not paid directly from the city treasury to the contractor. Rather, contracts at or above the minimum five thousand dollar value, however measured, and whichever way the money flows, are considered significant enough to warrant the formalities required by the statute.
Park Drive’s claim of unfair or deceptive acts or practices in violation of G. L. c. 93A, § 11,
Judgments affirmed.
The defendants filed two motions for summary judgment that were allowed by two different Superior Court judges. Summary judgment was first allowed as to the successor chief of police and later as to the city and the former chief of police.
According to the deposition of Sergeant James Griffin, who oversaw “the everyday operations . . . as far as police tows,” these requirements, which he could only “guess [were] mandated by the Chief,” were that each towing company have sufficient room to store towed cars and that they charge special rates for cars towed on account of snow removal or street sweeping. According to John Lentz, HI, coowner and president of Park Drive since September 26, 1996, the requirements also included that the owners of the tow companies have no criminal record relating to insurance fraud or the “auto industry,” that tow truck drivers be licensed and subject to “record checks,” that the companies maintain adequate equipment and sufficient insurance, that they remain open twenty-four hours per day, and that they keep a proper log of all tows.
The criminal complaints, alleging that the Lentz brothers had engaged in insurance fraud and larceny, were apparently initiated by Spadoni, who by this time no longer was involved with Park Drive.
The city solicitor informed Park Drive that its request would be reconsidered once it acquired the tow trucks necessary to perform the work.
The defendants also cite §§ 3.04.100 and 3.04.110 of the Revere Revised Ordinances, which govern municipal contracts and in addition require that all such contracts be filed with the city auditor and city clerk. General Laws c. 43, § 29, is explicitly referenced in § 3.04.100.
We have also held that a party cannot evade the statutory limitations on a municipality’s contracting power by rendering services and subsequently seeking recovery based on alternative theories. See United States Leasing Corp. v.
The legislative history of G. L. c. 43 suggests that a principal motivation for its passage was the belief that “city officials should be prohibited from participating in the making of contracts of all descriptions in cases where they have prominent connections with the contractors.” Report of the Joint Special Committee on City Charters, 1915 Senate Doc. No. 254, at 20.
Another important purpose of statutes such as G. L. c. 43, § 29, is to limit a municipality’s exposure if it is sued under a contract. See McGovern v. Boston, 229 Mass. 394, 397 (1918).
It has been suggested that because many contracts between Massachusetts municipalities and towing companies are unwritten the agreement here should
In support of its argument, Park Drive notes that our prior cases construing G. L. c. 43, § 29, or analogous statutes and ordinances, have dealt with arrangements that involve the expenditure, obligation, or appropriation of funds but never with an arrangement whereby the contractor is paying funds to the city. However, our prior cases have not restricted the applicability of G. L. c. 43, § 29, so as to exclude this type of arrangement.
General Laws c. 93A, § 11, provides, in pertinent part, that “[a]ny person who engages in the conduct of any trade or commerce and who suffers any
General Laws c. 40, § 21, authorizes municipalities, inter alla, to regulate parking, the leaving of vehicles in private ways, and the removal and storage of vehicles that interfere with snow plowing, garbage collection and parking spaces reserved for handicapped persons.