2018 Mass. App. Div. 147

April 13, 2018 - October 15, 2018

Appellate Division Western District

Court Below: District Court, Palmer Division

Present: Hadley, P.J., McGill & D'Angelo, JJ.

Damien J. Martin for the plaintiff.

Richard A. Sypek for the defendants.

D'ANGELO, J. Following a bench trial in this action for breach of contract, the trial judge found in favor of the plaintiff, Daniel Cropanese ("Cropanese"), and awarded him $16,800.00, plus statutory interest and costs. The defendants, Michael Lafever ("Lafever") and TML Realty, LLC, filed an expedited appeal pursuant to Dist./Mun. Cts. R. A. D. A. 8A. We affirm.

The trial judge made written findings of fact. He found that on August 14, 2001, Radar's Inc. and Lafever entered into a Commercial Purchase and Sale Agreement for 6-8 Fuller Street in Ludlow, MA and an Asset Purchase Agreement for the Brookside Café located at that address. Cropanese was the only stockholder and the only officer or director of Radar's Inc. The closings for the sale of real estate and the business assets were to take place on September 30, 2001. However, there was a delay in the closings because of financing issues, and delayed approval from the Alcohol Beverage Control Commission.

At some point, Cropanese became concerned that all the Brookside Café sale closing proceeds were going to pay off debts and that he was not going to make enough money in the sale, and he relayed this concern to Lafever. On January 7, 2002, Cropanese and Lafever entered into a separate agreement ("side agreement"). The side agreement provided that Lafever agreed to deposit $2,400.00 in an Individual Retirement Account for the benefit of Cropanese for the next ten years beginning in 2001. Contributions were due "on or before December 31 of each year." The side agreement was contingent upon Lafever "purchasing the assets of Radar's, Inc. d/b/a The Brookside Café on or before October 30, 2001." The side agreement was signed by the parties as individuals and not as corporate officers. Counsel for the parties were unaware of the side agreement.

Cropanese performed his obligation under the side agreement when the Brookside Café closing occurred on August 22, 2002. Despite this performance, Lafever, however, subsequently refused to honor the side agreement, despite repeated requests by Cropanese for payments.

Cropanese filed a civil action on November 19, 2010. Following a judgment for Cropanese, this appeal by the defendants followed.

1. Under Mass. R. Civ. P. 52(c), findings of fact will not be set aside unless clearly erroneous and deference should be granted to the findings of fact made by the trial court. Kendall v. Selvaggio, 413 Mass. 619, 620-621 (1992). On appeal, we consider

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whether a judge's findings are supported by any reasonable view of the evidence, including rational inferences of which the evidence was susceptible. T.L. Edwards, Inc. v. Fields, 371 Mass. 895 (1976). We consider issues of law de novo. Kendall, supra.

2. Lafever argues that the side agreement was invalid because the Asset Purchase Agreement was the entire agreement under paragraph twenty-eight. [Note 2] Lafever may have had a valid argument if the court had found that the side agreement had been entered into prior to the Asset Purchase Agreement. However, the trial judge made a factual determination that the side agreement was executed in January, 2002 -- five months after the Asset Purchase Agreement was signed. The Asset Purchase Agreement also states that the agreement "may be changed only by an agreement in writing, signed by the party against whom the enforcement of any waiver, change, modification or discharge is sought." Therefore, the side agreement is valid and does not contravene the agreement clause of the Asset Purchase Agreement.

3. Lafever also argues that the trial judge erroneously considered parol evidence that contradicted the express language of the Asset Purchase Agreement. The parol evidence rule bars evidence of prior or contemporaneous written or oral agreements that contradict, vary, or add to the express terms of a contract when those terms constitute the final and complete expression of the parties' agreement. Winchester Gables, Inc. v. Host Marriott Corp., 70 Mass. App. Ct. 585, 591 (2007). However, the rule does not prevent a fully integrated written contract from being modified by a subsequent oral or written agreement. Cambridgeport Sav. Bank v. Boersner, 413 Mass. 432, 439 (1992); First Pa. Mtge. Trust v. Dorchester Sav. Bank, 395 Mass. 614, 625 (1985). As noted above, the side agreement was signed five months after the contract was signed and satisfies the parol evidence rule because the trial court found it was not an antecedent or contemporaneous agreement.

4. Further, the side agreement was not invalid because there was a mutual mistake subject to reformation. The trial judge found that the side agreement was executed on January 7, 2002. One of the essential terms of that agreement was that Lafever purchase "the assets of Radar's, Inc. d/b/a The Brookside Café on or before October 30, 2001." The trial judge found that the date of October 30, 2001 was a mutual mistake because it was clear that both parties intended the closing date to happen sometime after the final sale. The initial date stated in the agreement made performance impossible, and the trial judge determined it was clear by other written instruments and the parties conduct that the parties intended something different. Further, for a mistake to be mutual, it must be made by both parties or be made by one party and known by the other party. Appellants' own appeal acknowledges their knowledge of the mistake.

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"If the language of a written instrument does not reflect the true intent of the parties, the mutual mistake is reformable." Polaroid Corp. v. Travelers Indem. Co., 414 Mass. 747, 756 (1993). Here, the court reformed the agreement, based on a finding that the August 22, 2002 closing date satisfied the intentions of the parties to the side agreement. This reformation was fully justified and lawful under general principles of equity. Beaton v. Land Court, 367 Mass. 385, 392 (1975). It is important to note that the trial judge's decision on the question of a mutual mistake is based on his specific findings of fact. Lafever suggests that the trial judge's decision was not supported by the evidence. As this is an expedited appeal pursuant to Rule 8A, we are impeded by the lack of a transcript and cannot determine whether the findings were supported or controverted by the evidence at trial.

5. Finally, the installment payments due after November 19, 2004 were not barred by the statute of limitations. The trial judge correctly found that installment payments due prior to November 19, 2004 were barred because the complaint was filed on November 19, 2010. The statute of limitations for contracts not under seal is six years. G.L. c. 260, § 2. The trial judge held that the side agreement was an installment contract without an automatic acceleration provision. Without an acceleration provision, the statute of limitations runs from the date each installment was due, and each installment can be viewed as a defaulting event. "[W]hen an instrument is payable in installments, the cause of action on each installment accrues on the date following the date the installment is due." Clark v. Trumble, 44 Mass. App. Ct. 438, 445 (1998), quoting 4 Hawkland & Lawrence U.C.C. Series § 3-122:02, at 293 (1994). The payments due after November 19, 2004 are not barred because the claim was filed on November 19, 2010 and thus satisfies the six-year requirement of the statute of limitations.

For the aforementioned reasons, the judgment of the trial court is hereby affirmed.


[Note 1] TML Realty, LLC.

[Note 2] Paragraph twenty-eight of the Asset Purchase Agreement provides:

"28. Entire Agreement. This Agreement, including the Schedules, Exhibits or other instruments delivered pursuant hereto, embodies the entire agreement between the parties, and may not be changed orally, but may be changed only by an agreement in writing, signed by the party against whom enforcement of any waiver, change, modification or discharge is sought."