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LLC v. Jace Boston, LLC

Supreme Judicial Court of Massachusetts, Suffolk

May 23, 2017

477 HARRISON AVE., LLC
v.
JACE BOSTON, LLC, & another. [1]

          Heard: January 5, 2017

         Civil action commenced in the Superior Court Department on March 23, 2015. A special motion to dismiss was heard by Dennis J. Curran, J.

         The Supreme Judicial Court granted an application for direct appellate review.

          Mark S. Furman (Emily C. Shanahan also present) for the defendants.

          Andrew E. Goloboy (Ronald W. Dunbar, Jr., also present) for the plaintiff.

          Present: Gants, C.J., Botsford, Lenk, Hines, Gaziano, Lowy, & Budd, JJ. [2]

          LENK, J.

         This case involves the application of G. L. c. 231, § 59H, the "anti-SLAPP" statute, to a dispute between adjoining building owners. In 2011, the plaintiff purchased a parcel of property located at 477 Harrison Avenue in Boston with the goal of redeveloping it. The defendants own an abutting parcel.[3] Over the course of the next several years, the defendants opposed the plaintiff's redevelopment plans in various legal and administrative arenas. The plaintiff eventually filed a complaint against the defendants, raising claims of abuse of process and a violation of G. L. c. 93A, § 11. The defendants responded by filing a special motion to dismiss pursuant to G. L. c. 231, § 59H. A Superior Court judge denied the motion, the defendants appealed, and we allowed their application for direct appellate review.

         We consider first whether the defendants have met their threshold burden under the anti-SLAPP statute of showing that each claim is solely based on the defendants' petitioning activity. See Duracraft Corp. v. Holmes Products Corp., 427 Mass. 156, 167 (1998) (Duracraft). We conclude that they have done so as to the abuse of process claim, but not as to the G. L. c. 93A claim. The judge correctly denied the special motion to dismiss the latter claim. The defendants having met their threshold burden as to the abuse of process claim, however, the burden then shifts to the plaintiff to show that the petitioning activity on which that claim is based lacks a reasonable basis in law or fact and has caused it actual injury, i.e., is not a valid exercise of the right to petition. On the record before the motion judge, who did not reach the issue, it is evident that only a portion of the defendants' petitioning activity that forms the basis for the plaintiff's abuse of process claim was shown to lack such a reasonable basis. Given this, predating today's decision in Blanchard v. Steward Carney Hospital, Inc., 477 Mass., (2017) (Blanchard), the plaintiff could proceed on only so much of its abuse of process claim as alleges the invalid exercise of the right to petition, with the remainder dismissed pursuant to the special motion. Notwithstanding this, however, in light of Blanchard, which augments the Duracraft framework, we remand the matter to the Superior Court. The plaintiff will then have the opportunity to show that the entirety of its abuse of process claim was not primarily brought to chill the defendants' legitimate petitioning activity. A successful showing in this regard will defeat in full the special motion to dismiss.

         1. Background.

         We summarize the relevant facts from the pleadings and affidavits that were before the motion judge. See Benoit v. Frederickson, 454 Mass. 148, 149 (2009). In December of 2011, the plaintiff purchased a parcel of property located at 477 Harrison Avenue (477 Harrison) containing a five-story brick building with the intent to redevelop it for residential use. In preparation for this redevelopment, the plaintiff's building manager, John Holland, met with Arthur Leon, the sole owner of JACE Boston, LLC, which owned the building at 1234 Washington Street (1234 Washington) that shared a wall with the plaintiff's building.[4] According to the plaintiff, Leon asked Holland to delay the redevelopment of 477 Harrison so that the defendants could redevelop 1234 Washington. Richard J. Leon attested that his cousin, the defendant Leon, told him of "his intention to wait [the plaintiff] out until [the plaintiff] fell into bankruptcy on the loan and that [he] would then purchase 477 Harrison Avenue from the bank for" a fraction of what the plaintiff paid to purchase the property.[5] The plaintiff did not accede to Leon's purportedly requested delay.

         Years of conflict between the parties followed. The first front in the ongoing struggle opened with the plaintiff's request for zoning relief in early 2012. When the plaintiff sought such relief from the zoning board of appeal of Boston (ZBA), Leon's attorney contacted the ZBA on his behalf to oppose it. Despite this, the ZBA unanimously voted to grant the plaintiff's requested variances and conditional use permits. The defendants appealed from the ZBA's decision in August of 2012. During the same time frame, the plaintiff also requested a small project review of its redevelopment proposal from the Boston Redevelopment Authority (BRA). Leon wrote to the BRA to oppose this.

         During the summer of 2012, the defendants brought a declaratory judgment action regarding rights to the parties' shared wall. The defendants' claim rested on an indenture and agreement dated June, 1926, which provides that the owner of the "garage building" then under construction at 1234 Washington Street would have the "right and easement" "to tie unto and to use for the support of said garage building the northeasterly wall ... of the stable" then at 477 Harrison Avenue "to a height not exceeding two stories nor more than thirty four feet above the line of the present curbstone at the westerly corner of Harrison Avenue and Perry Street." In September, 2014, a Superior Court judge ruled that this agreement referenced the parties' respective buildings, and that it precluded the plaintiff from demolishing the party wall between the two properties below the height specified in the agreement.

         With these matters pending and its redevelopment plans thereby stalled, the plaintiff opted for what it hoped would be a faster path forward. In September, 2013, as the parties' summary judgment motions awaited resolution in the Superior Court, the plaintiff abandoned its request for zoning relief, then on appeal, to pursue instead an "as of right project."[6] The plaintiff obtained a short form building permit from the inspectional services department (ISD) in October of 2013, from which the defendants promptly appealed. Armed with the permit, however, the plaintiff notified the defendants that it intended to commence work on the parties' shared wall in late November, 2013. The defendants immediately sought a preliminary injunction to prevent the plaintiff's construction. Rejecting the defendants' application for equitable relief, a Superior Court judge instead entered an order allowing the plaintiff to remove the undisputed portions of the wall. In the meantime, the ISD issued the plaintiff a permit allowing it to trespass on the defendants' property for the purpose of protecting the roof of the defendants' building during the removal of the undisputed portions of the wall.

         And with that, the plaintiff finally began redeveloping its property in January, 2014, two years after it initially had told Leon about its plans. Prior to commencing construction, the plaintiff provided the defendants with copies of the ISD short form permit, the order from the judge permitting removal of the undisputed portions of the wall, project plans, and an insurance certificate. The defendants again sought injunctive relief to prohibit the plaintiff from entering onto their property, and a Superior Court judge again denied the relief sought. The judge also issued an order expressly allowing the plaintiff to enter onto the defendants' property to protect it from damage.

         As the construction began, the conflict continued, [7] coming to a climax in December, 2014. At that time, Leon filed a police report reflecting that Holland's employees were standing on the defendants' roof and thereafter brought an application for a criminal complaint alleging that Holland had trespassed illegally on his property.[8] The clerk magistrate at the Boston Municipal Court found insufficient probable cause to support the charge, and dismissed the complaint. In January, 2015, the plaintiff again sought to construct penthouses on its property, and requested the requisite zoning relief from the ZBA. The defendants provided a written opposition, but the ZBA granted the plaintiff its requested relief. The defendants once again appealed from this determination to the Superior Court.

         Shortly thereafter, and more than three years after the plaintiff first had begun pursuing its redevelopment plans, the plaintiff filed a complaint against the defendants in the Superior Court, claiming abuse of process and a violation of G. L. c. 93A, § 11. With regard to the abuse of process claim, the plaintiff maintained that the defendants "wrongfully used process for ulterior purposes, including" delaying or preventing the development of the plaintiff's property so that the defendants could (1) "bankrupt 477 Harrison Ave., LLC and purchase [it] from the bank at a discount price"; (2) develop their own property at 1234 Washington Street prior to the development of the plaintiff's property; (3) gain leverage over the plaintiff to coerce it into removing any windows providing views over the defendants' property at 1234 Washington Street; and (4) extort the plaintiff into paying off the defendants. The plaintiff also alleged that the defendants' actions constituted "unfair or deceptive acts or practices and/or unfair competition in violation of [G. L. c. 93A] and the Attorney General's regulations promulgated thereunder."

         In response to the plaintiff's complaint, the defendants filed a special motion to dismiss pursuant to the anti-SLAPP statute. A Superior Court judge denied the special motion, concluding that the defendants "[could not] meet their burden under [the anti-SLAPP statute] to establish that the plaintiff's suit [was] solely based on their petitioning activity and [had] no other substantial basis [emphasis in original]."

         2. Discussion.

         The defendants maintain that they have met their threshold burden and that the plaintiff has not then shown -- as it must under Duracraft, 427 Mass. at 167, in order to defeat the special motion to dismiss -- that the defendants' petitioning activity lacked a reasonable factual or legal basis. They argue that the judge accordingly erred in denying their special motion to dismiss. The defendants are correct only in part. They have met their threshold burden as to the abuse of process claim but not as to the G. L. c. 93A claim, and the judge correctly denied the motion as to the latter claim. As to the abuse of process claim, the defendants are correct that the plaintiff has not shown that the entirety of the defendants' petitioning activities of which the plaintiff complains lack a reasonable basis in law or fact. However, given our recent decision in B ...


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