Heard: December 7, 2018.
action commenced in the Land Court Department on April 29,
case was heard by Michael D. Vhay, J., on motions for summary
O. Moriarty for the plaintiffs.
Charles G. Devine, Jr., for USAlliance Federal Credit Union.
Michael Grant (Nancy M. Reimer also present) for the
Present: Sullivan, Massing, & Sacks, JJ.
Village Condominiums is an age-restricted condominium
development built in phases. After some but not all of the
phases had been built, the developer ceased operations at the
site. A dispute arose between the developer's mortgage
lender and the condominium trust concerning the right to
construct additional units. On cross motions for summary
judgment, a judge of the Land Court granted partial summary
judgment to the lender, USAlliance Federal Credit Union
(USAlliance), and intervener Sean P. Fallon. The judge
declared that USAlliance held a mortgage interest in the
undeveloped common area, and that the developer's
reserved phasing rights were largely intact, but that two
easement rights had expired. After entry of final judgment,
the Beechwood Village Condominiums Trust (condominium trust),
USAlliance, and Fallon each appealed.
conclude that all of the land associated with the condominium
development, including the common area, was submitted to the
provisions of G. L. c. 183A, the Condominium Act (act or
statute), by the master deed,  and that the effect of the
subsequent mortgage discharges by the relevant lenders upon
the sale of each unit was to release the lenders'
mortgage interest in all of the common area. The unit owners
became the fee simple owners of all of the common area as
tenants in common, including the undeveloped common area. The
mortgage interest in the phasing and easement rights reserved
by the developer, however, was not released by the partial
discharges. We further conclude that the developer retained
its phasing rights for an unlimited period of time, but that
the construction easement contained in the master deed -- to
pass over "the Common Areas and Facilities" (common
area) for purposes of constructing additional phases --
expired seven years after the master deed was recorded.
The development, master deed, and mortgages.
background facts are undisputed. On May 11, 2006, Mark S.
Gardner, as trustee of the Mark S. Gardner Trust, sold to
Jeffrey S. Reale, as trustee of the Beechwood Village Realty
Trust (developer), a thirty-seven acre parcel of land
referred to by the parties as lot 7 on Beech Street in
Rockland. On the same day, the developer granted a first
mortgage to USAlliance to secure payment of a note in the
original principal amount of $2, 800, 000 (2006 USAlliance
mortgage),  and a second mortgage to Gardner to secure
payment of a note in the original principal amount of $1,
900, 000 (Gardner mortgage). On March 9, 2007, the developer
submitted the entirety of lot 7 to the provisions of the act
by recording the master deed in the registry of deeds. The
master deed stated that all land and appurtenances, and phase
one of the development, were submitted to the statute. The
master deed also reserved to the developer (referred to as
declarant) the right to create additional phases. See G. L.
c. 183A, § 16.
master deed provided that the condominium could include up to
seventy-nine age-restricted "single family free-standing
dwelling" units to be constructed in up to thirty
phases. A site plan depicting seventy-nine lots was recorded with
the master deed. Article 4A & B of the master deed
reserved for the developer phasing and construction rights
and associated easements as set forth in full in the
Appendix, and discussed in greater detail, infra.
Article 4A set out the developer's phasing rights.
Article 4B(i) reserved, among other things, certain
construction easements for a period of seven years, while
article 4B(ii) and (iii) granted, without temporal
limitation, other easement rights for passage to and from
buildings and for utilities.
one, consisting of three units, was constructed before the
master deed was recorded. The three units were sold to
third-party purchasers shortly after the master deed was
recorded, together with each unit's undivided 33.3
percent share of the common area. The master deed defined the
common area to include "the Condominium land all parts
of the building and improvements thereon, other than the
Units." That is, the common area included not only the
facilities and the entirety of lot 7, but also the land under
the individual units, albeit subject to exclusive use
restrictions set forth in the master deed. Thus, each unit
sat on land designated as a common area, but the unit owner
held an exclusive use easement in the lot on which the unit
was located. An exhibit to the master deed reflected
that the entirety of the common area was conveyed when the
three units in phase one were sold, subject to provisions in
the master deed that permitted dilution of the respective
percentage interests as additional units were built and sold.
The developer did not reserve a reversionary interest in any
portion of the common area. Partial discharges of the
mortgage were issued to each of the three phase one unit
owners and recorded at or after the time the master deed was
original USAlliance mortgage was refinanced on April 11, 2007
(2007 USAlliance mortgage). The 2007 USAlliance mortgage
secured an adjustable rate promissory note in the original
principal amount of $4, 700, 000, and granted USAlliance a
mortgage interest in all of the developer's interest in
and to the condominium land, unsold units, all buildings
erected or to be erected, and all improvements including all
paved walkways, driveways, and parking areas, among others.
On April 11, 2007, Gardner signed an agreement subordinating
his mortgage to the 2007 USAlliance mortgage. Gardner
assigned his mortgage to USAlliance in 2012, so that by the
time of this litigation, USAlliance held both Gardner's
2006 mortgage and its own 2007 mortgage. The notes have not
been paid in full.
to the phasing and easement rights reserved by the developer,
multiple phases of the condominium, totaling fifty-four
units,  were constructed between 2007 and 2011.
As each phase was constructed, the corresponding units were
added to the condominium by amendment to the master deed. The
record contains copies of recorded revised site plans for
each phase, which indicate that units have been built
fronting on each of the condominium's proposed roadways.
Only scattered single lots, on what appear to be already
constructed roadways, have yet to be built on.
Partial discharges and releases.
he assigned his mortgage to USAlliance, Gardner executed and
recorded a "Partial Discharge of Real Estate
Mortgage" when each unit was sold. USAlliance
also executed partial releases when units subject to its
mortgage were sold.
project ran into severe financial difficulties caused in part
by the real estate market downturn. No additional phases were
added after December 23, 2011.
April 29, 2016, the condominium trust commenced this action
in the Land Court seeking declarations that can be divided
into three general categories: (i) the 2007 USAlliance
mortgage no longer encumbers any interest in the condominium
land or buildings; (ii) the developer's development,
phasing, and easement rights expired on March 9, 2014, seven
years after the master deed was recorded; and (iii) the
common area of the condominium is not subject to any
development without consent of seventy-five percent of the
unit owners. USAlliance, by way of counterclaim, sought
declarations that (i) as assignee of the Gardner mortgage, it
has a mortgage interest in the condominium land superior to
the master deed, securing both the loan from Gardner and all
debts owed to USAlliance by the developer; (ii)
USAlliance continues to have a mortgage interest in the
phasing rights pursuant to the 2007 mortgage; and (iii) the
phasing and easement rights set forth in the master deed
remain enforceable. The parties filed cross motions for
of the Land Court made several declarations that are not
challenged on appeal and which we take as final for purposes
of this opinion. The contested issues are as follows. The
judge specifically rejected the condominium trust's
argument that the Gardner mortgage had been subordinated to
the master deed and concluded that "[t]he Partial
Discharges did nothing more than shrink, unit by unit, the
areas subject to the security interests established in the
Gardner Mortgage." For that reason, he declared that
USAlliance, as assignee of the Gardner mortgage, "has a
security interest in the premises described in that mortgage
[lot 7] that is superior to any interest in those Premises
that arises under or subsequent to the Master Deed,"
except to the extent that the Gardner partial discharges
released from the mortgage the specific units and not the
associated percentage interest in the common area.
judge then declared that the developer's rights under two
parts of article 4 of the master deed had expired.
Specifically, the affected development rights are (1)
"all of [the developer's easement] rights under
article 4(B) (i)," and (2) the developer's
"right and easement in and over phase one of the
Condominium, as described in article 4(A), 'to construct
the buildings, roadways and other amenities, and to construct
drainage and perform grading on and over roadways and other
amenities, and that portion of the premises shown as
subsequent phases on the Condominium Plans. . . .'"
He concluded that "[n]one of [the developer's]
rights under article 4 has expired except for the two rights
parties jointly sought clarification of the judge's
decision. The judge declined to answer the parties'
question whether the developer was "prevented from
building on the undischarged lots because the expiration of
the phasing rights contained in Articles 4A and 4(B)(i)
prevents access to those lots." The judge reasoned, in
part, that there were no present plans to build and the
prevailing parties, USAlliance and Fallon, had not asked for
a declaration as to buildability. The net result of the
judgment was that USAlliance retained a mortgage interest in
the common area including the as yet unbuilt areas on the
site plan, but the nature and scope of its development rights
remained in doubt. All remaining parties appealed from the
judgment. See note 1, supra.
review a summary judgment record de novo to determine
"whether, viewing the evidence in the light most
favorable to the nonmoving party, all material facts have
been established and the moving party is entitled to a
judgment as a matter of law." Augat, Inc.
v. Liberty Mut. Ins. Co., 410 Mass. 117,
120 (1991). When reviewing cross motions for summary
judgment, however, "we view the record in the light most
favorable to the party against whom the judge allowed summary
judgment . . . ." Marhefka v.
Zoning Bd. of Appeals of Sutton, 79 Mass.App.Ct.
515, 516 (2011). See Welch v.
Barach, 84 Mass.App.Ct. 113, 118-119 (2013).
"Because the judge does not engage in fact finding in
ruling on cross motions for summary judgment, we owe no
deference to his [or her] assessment of the record."
Marhefka, supra at 517.
of the master deed and partial releases is at the heart of
this dispute. "Principles of deed and contract
interpretation guide our discussion of the issues. In
interpreting a deed, as with any contract, we 'must
construe all words that are plain and free from ambiguity
according to their usual and ordinary sense.'"
Boston Redev. Auth. v. Pham, 88
Mass.App.Ct. 713, 717 (2015), quoting Suffolk Constr.
Co. v. Lanco Scaffolding Co., 47
Mass.App.Ct. 726, 729 (1999). "Where the language of a
contract is clear and unambiguous, summary judgment is an
appropriate vehicle for judicial interpretation because the
court may interpret the meaning of the contract as a matter
of law without resort to extrinsic evidence or determinations
of fact." Sullivan v. Southland
Life Ins. Co., 67 Mass.App.Ct. 439, 440 (2006). Here,
the parties do not claim that any of the documents at issue
are ambiguous or that summary judgment was otherwise
conduct our review with well-settled principles of
condominium law in mind. "[D]eeds should be construed as
to give effect to the intent of the parties, unless
inconsistent with some law or repugnant to the terms of the
grant" (quotation and citation omitted). Queler
v. Skowron, 438 Mass. 304, 311 (2002).
"General Laws c. 183A is essentially an enabling
statute, setting out a framework for the development of
condominiums in the Commonwealth, while providing developers
and unit owners with planning flexibility. Such flexibility
is particularly important with respect to phased condominium
developments where long-term financial and market conditions
may be uncertain. While G. L. c. 183A mandates that certain
minimum requirements for establishing condominiums be met,
those matters that are not specifically addressed in the
statute are to be worked out by the involved parties"
(citation and footnote omitted) . Id. at 312-313. So
long as the statutory minimum is met, the master deed may
modify the statutory definition of common area contained in
c. 183A, and "[t]hus, the master deed itself provides
'the rules of the game' . . . ." Flynn
v. Parker, 80 Mass.App.Ct. 283, 289 (2011).