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Cedar-Fieldstone Marketplace LP v. T.S. Fitness, Inc.

Appeals Court of Massachusetts, Bristol

March 15, 2018

CEDAR-FIELDSTONE MARKETPLACE, LP
v.
T.S. FITNESS, INC., [1] & another. [2]

          Heard: February 2, 2018.

         Civil action commenced in the Superior Court Department on June 18, 2015.

         The case was heard by Renee P. Dupuis, J., on motions for summary judgment.

          John A. Walsh for the defendants.

          John F. White, Jr., for the plaintiff.

          Present: Milkey, Massing, & Shin, JJ.

          MILKEY, J.

         In this case, we consider whether the release of a landlord's claims against a tenant for unpaid rent pursuant to a lease precluded the landlord from bringing a collection action against a guarantor of the lease. We conclude that it did not.

         Background.

         The defendant T.S. Fitness, Inc. (tenant), rented commercial property in New Bedford from the plaintiff, Cedar-Fieldstone Marketplace, LP (landlord). In 2011, those parties agreed to a modification of the then-existing lease between them. To secure the tenant's payment obligations under the modified lease, the tenant's president, the defendant Thomas W. Sheridan, executed a personal guaranty, which was memorialized in a detailed, three-page document. Under the terms of the guaranty, Sheridan's liability was "co-extensive with that of [the t]enant, " except that it was capped at a specified amount, $52, 271.06. The existence of that cap appears to explain why the document is captioned a limited guaranty.

         Except for the cap on his liability, Sheridan's obligations under the guaranty are set forth expansively, as we will review in detail later. The guaranty states that "[n]o waiver or modification of any provision of this [g]uaranty nor any termination of the [g]uaranty shall be effective unless in writing, signed by [the l]andlord."

         After the lease modification, the tenant subsequently defaulted on the lease, prompting the landlord to bring a summary process action against it in District Court. That action was resolved through an agreement for judgment in February of 2013. The parties to the agreement for judgment were the parties to the summary process action, that is, the landlord and the tenant. Sheridan himself signed the agreement for judgment, but he did so in his capacity as president of the tenant.

         The essence of the agreement for judgment was that the landlord allowed the tenant to occupy the premises for an additional three months, and that the tenant agreed to vacate the premises after that and to make agreed-to monthly use and occupancy payments in the interim. The body of the agreement for judgment included a paragraph through which the tenant expressly (and broadly) released its potential claims against the landlord. Curiously, there is no corresponding provision that addresses what claims the landlord agreed to release. However, in prefatory "whereas" clauses, there is language that could be taken to suggest that the agreement for judgment was intended to resolve the entirety of the dispute between the parties.[3]

         After the agreement for judgment had been executed, the landlord brought a collection action in Superior Court against both the tenant and Sheridan seeking over $100, 000 in unpaid rent. Relying on the prefatory language quoted in note 3, supra, a Superior Court judge (first motion judge) ruled, as a matter of law, that the agreement for judgment barred the landlord's only count (breach of contract) against the tenant.[4]That ...


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