CITY OF BOSTON vs. ROXBURY ACTION PROGRAM, INC., & others. [Note 1]

BROWN, J. The city of Boston (city) commenced this action against Roxbury Action Program, Inc. (RAP), E. Denis Walsh (as trustee of the Rap-Up Nominee Trust), Frederick Massaro, and E&M Realty Corp., seeking to acquire title, free of all mortgages, to the properties located at 6-45 Vale Street and 60

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Fulda Street in the Roxbury section of Boston (the property). The city seeks to enforce a covenant contained in a recorded document entitled "Instrument of Restriction" in which, among other things, RAP promised to convey the property to the city by July 31, 1974, if RAP was unable to obtain a certain governmental commitment for a housing development on the property. In lieu of answering the complaint, defendants Walsh, Massaro, and E&M Realty Corp. moved for summary judgment on the ground that the thirty-year statute of limitations contained in G. L. c. 184, § 23, bars the city's claims. The Land Court judge agreed and allowed the motion. Judgment entered dismissing the complaint against all four defendants, and the city appeals. [Note 2] While we hold that c. 184, § 23, is not applicable to the issues raised by the complaint, we nonetheless affirm as the city has failed to meet any applicable statute of limitations.

Background. We glean the facts from the undisputed submissions of the parties. [Note 3] RAP, a nonprofit corporation, purchased the property on September 27, 1972, from the Fulda Realty Trust for consideration of $45,000. The record suggests that the city provided the purchase monies to RAP through a Federal grant. [Note 4] On March 6, 1973, RAP executed what is entitled an "Instrument of Restriction" (the instrument) on the property

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and recorded it on March 9, 1973. The instrument recites that it was created pursuant to a contract between RAP and the city of Boston dated August 1, 1971. Although the instrument makes reference to the contract, there is no language that incorporates the contract into the instrument. The relevant text of the instrument is contained in the margin. [Note 5]

In short, the instrument requires RAP to "reconvey" [Note 6] the property to the city no later than July 31, 1974, in the event that a commitment for a housing development has not been obtained. It is undisputed that RAP never obtained the requisite commitment. It is also undisputed that RAP never conveyed the property to the city pursuant to the terms of the instrument and that no exception was granted. To the contrary, on November 8, 1988, RAP granted a mortgage on the property to defendants E. Denis Walsh and Frederico Massaro to secure the payment of $189,000, and on August 10, 1990, RAP transferred the property

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to defendant Walsh and Lloyd H. King, as trustees of Rap-Up Nominee Trust. The 1988 mortgage on the property was increased by $50,000 by an amendment dated September 19, 2000, and recorded on January 30, 2002. An additional mortgage on the property was granted to defendant Massaro by an instrument recorded on February 11, 2003. The complaint alleges that E&M Realty now holds the 1988 mortgage. [Note 7]

There is nothing in the record to show that the city made any attempt to compel the conveyance of the property prior to July 22, 2004, when it, by letter, demanded that RAP convey the property to the city. By that time, of course, RAP no longer retained title to the property. On July 30, 2004, the city commenced this action seeking imposition of a resulting trust, imposition of a constructive trust, a determination that the city holds an enforceable option in gross, declaratory relief that the city has equitable title to the property, and specific performance of RAP's duty to convey the property to the city free of any mortgages.

A Land Court judge determined that the housing restriction imposed by the instrument is controlled by the statute of limitations contained in G. L. c. 184, § 23. [Note 8] The judge further found that the "public purpose" exemption contained in § 23 does not apply because RAP purchased the property from a private entity and, although the city provided the funds for the purchase, the conveyance was not a "gift[] or devise[] for public, charitable or religious purposes." The judge concluded that because the city took no steps to enforce the "restrictions" within the thirty-year statute of limitations contained in § 23, summary judgment should enter for the defendants. The judge further found that the shorter statutes of limitations applicable to constructive trusts and resulting trusts bar those claims as well.

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Discussion. The relief sought in each count of the city's complaint, regardless of the theory of relief, is the conveyance of the property to the city free of all mortgages. Perhaps because enforcing that portion of the instrument that requires RAP to use the property for housing purposes (section [a]) would not achieve that result, the complaint makes no effort to enforce section (a). Notwithstanding the remedies sought by the city, however, the parties focus on section (a) in arguing that G. L. c. 184, § 23, either applies or does not apply. We think the emphasis on section (a) is misplaced. RAP's failure to use the property for housing purposes, in and of itself, does not trigger the obligation to reconvey the property. As we read the instrument, the city may achieve its goal of a reconveyance of the property only by enforcing section (c) of the instrument. [Note 9]

We thus turn our attention to section (c) and consider first whether G. L. c. 184, § 23, applies to it. We hold that it does not. Even if we were to conclude that RAP's obligation to convey the property to the city constitutes a "condition[] or restriction[]" as those terms are used in § 23, we are not convinced that the condition or restriction is "unlimited as to time." "The word 'unlimited' means without confines, unrestricted, boundless." Flynn v. Caplan, 234 Mass. 516, 520 (1920) (construing predecessor to G. L. c. 184, § 23). In contrast, the instrument at issue provides a date certain by which RAP must convey the property to the city. When that date arrived without RAP having obtained the requisite commitment or having conveyed the property to the city, RAP was in breach of its obligation, and the city became entitled to enforce an immediate conveyance of the property. Neither the defendants nor the city cite to relevant authority for the proposition that RAP's failure to convey the property on the date set for performance transforms the obligation into one that is unlimited in time. The opinion in Stop & Shop Supermarket Co. v. Urstadt Biddle Properties, Inc., 433 Mass. 285, 289-290

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(2001), wherein the parties amended a deed restriction by removing the fifty-year period of duration, thereby rendering it "unlimited as to time" from the time of the amendment, is inapposite.

Somewhat surprisingly, in an alternative argument the city agrees that the "restriction" is not unlimited as to time and that § 23 and its thirty-year period of limitation do not apply to RAP's obligation under section (c). That § 23 is not applicable to RAP's obligation to convey the property by a date no later than July 31, 1974, however, does not mean that the obligation may be enforced indefinitely. We therefore turn to the specific claims of the city and the applicable statutes of limitations. We conclude that where the city waited nearly thirty years to enforce its rights, it cannot recover under any of its theories.

a. Specific performance. This action quite correctly may be considered an effort to enforce specifically RAP's obligation to convey the property to the city. The city's cause of action for specific enforcement accrued at the time RAP committed a breach of the obligation to convey the property to the city, on July 31, 1974. The city contends that its cause of action did not accrue until RAP refused the city's demand to convey the property. RAP's performance, however, was not subject to the city's demand. Rather, the instrument establishes a date for performance, no later than July 31, 1974. The city's cause of action accrued on that date when RAP failed to perform. Whether the action is viewed as one upon a contract under seal, see G. L. c. 260, § 1, [Note 10] or as one for "recovery" of the property, as that term is used in G. L. c. 260, § 31, [Note 11] the applicable period of limitation expired twenty years from the date on which RAP

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became obliged, and failed, to convey the property to the city. In either event, as of July 31, 1994, the city's claim was timebarred.

b. Resulting trust. "A resulting trust is based upon the presumption that he who supplies the purchase price intends 'that the property bought shall inure to his own benefit and not that of another, and that the conveyance is taken in the name of another for some incidental reason.' " Dwyer v. Dwyer, 275 Mass. 490, 494 (1931), quoting from Quinn v. Quinn, 260 Mass. 494, 501 (1927). On appeal, the city claims that it has an equitable interest in the property via a resulting trust that arose on the date that RAP purchased the property with the government funds furnished by the city.

We are not at all convinced that a resulting trust properly may be imposed in such circumstances as here, where the parties, by contract, comprehensively established the parties' obligations with respect to the property purchased with monies granted to RAP by the city. Compare Zarum v. Brass Mill Materials Corp., 334 Mass. 81, 85 (1956). The express requirement of a conveyance to the city in the event that a commitment is not obtained seems to negate a resulting trust theory. We need not dwell on the relative merits of the city's claim, however, because "[t]he applicable statute of limitations for purposes of enforcing a resulting trust is six years." Stapleton v. Macchi, 401 Mass. 725, 729 (1988), citing G. L. c. 260, § 2. "The cause of action accrues when the plaintiff becomes aware that the trust has been repudiated." Stapleton v. Macchi, supra. We agree with the Land Court judge that the city's resulting trust claim misses the mark, if for no other reason, because the city failed to bring it within the six-year statute of limitations.

The city argues that the record is unclear as to when it became aware that any such trust had been repudiated. We disagree. If a resulting trust arose because the city provided purchase monies for the property, it cannot be considered separate and apart from the rest of the dealings between the parties, including RAP's obligation to reconvey the property. The city does not deny

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knowing that on July 31, 1974, RAP had not secured the requisite commitment, transferred the property to the city, or obtained an extension. The city's argument that it had no knowledge of RAP's repudiation is belied by the simple fact that RAP failed to transfer the property on the required date, July 31, 1974. No evidence was offered suggesting that RAP made any statements to the city that it either intended to convey the property as required or would obtain the necessary commitment that could have called into doubt RAP's clear repudiation of any trust. The city's reliance on a single communication regarding a tax issue in 2002, many years after the limitation period had passed, hardly raises a question of fact as to whether RAP had clearly repudiated the trust.

In addition, pursuant to the city's contract with RAP, the city was to be updated monthly on RAP's activities related to the development of the property. The city does not suggest that RAP failed to keep it informed or otherwise concealed the fact that financing had not been secured. Given the express right to information provided to the city through its contract with RAP, the city cannot rely on its failure to make reasonable inquiry as a basis for arguing that it lacked actual knowledge of a repudiation by RAP.

c. Constructive trust. While the basis for the city's claim that the defendants hold the property subject to a constructive trust in favor of the city is far from clear, whether it is based on tortious conduct or contractual theories, the applicable three- or six-year statute of limitations also bars the claim. See Brodeur v. American Rexoil Heating Fuel Co., 13 Mass. App. Ct. 939, 940-941 (1982). See also G. L. c. 260, §§ 2, 2A.

As it is apparent on the record before us that the city's efforts to acquire title to the property are barred by all applicable statutes of limitations, we affirm the judgment of the Land Court dismissing the action. [Note 12]

Judgment affirmed.