MDC PROPERTIES - WESTFORD ROAD, LLC V. MITTAS EARLY LEARNING, LLC [Note 1]

NESTOR, P.J. The trial court found for the tenant for possession after a bench trial in this commercial summary process case arising from the tenant's failure to pay rent during the beginning of the COVID-19 pandemic. The landlord brings this appeal to the Appellate Division under Dist./Mun. Cts. R. A. D. A. 8C. We affirm.

Background. The landlord, MDC Properties - Westford Road, LLC ("Landlord"), rented space to the tenant, Mittas Early Learning, LLC ("Tenant"), to operate a daycare center at its property. Tenant is a franchise operator of The Learning Experience. Tenant has been in business at this Tyngsboro location since October, 2016. The facility cares for children between the ages of six months until approximately six years old. Tenant made timely payments from the inception of the lease in October, 2016 through March, 2020.

On March 20, 2020, Governor Charles Baker ordered all daycare facilities to close due to the COVID-19 pandemic. Governor Baker ultimately kept the order in place, which resulted in Tenant's daycare business being closed until June 29, 2020. Tenant did not pay rent for the months of April, May, and June, 2020.

The lease contains a force majeure provision in which the parties acknowledge that the facility may be required to close due to "governmental regulations or controls," or by an "act of God," or due to "other causes beyond control of Landlord or Tenant." The lease specifically requires that Tenant must continue to pay rent if any of the above events occurs: "Force Majeure shall not excuse a party from paying in a timely fashion any payments required to be made under this lease when due under the terms of the lease." The terms of the lease required Tenant to carry business interruption insurance to cover at least one year of rental payments.

Landlord gave formal notice of termination to the Tenant in accordance with the terms of the Lease. The Landlord then terminated the lease on May 19, 2020. On June 24, 2020, Tenant made payments of all outstanding moneys and then resumed its scheduled monthly payments under the lease. Approximately six months later, Landlord filed a summary process action.

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A jury-waived trial was held on March 18, 2021. On May 6, 2021, the court entered judgment for the defendant for possession. Landlord timely filed a notice of appeal on May 14, 2021.

Discussion. Implied in the trial judge's finding in favor of the defendant for possession was the allowance of the defendant's request of the court to exercise its equitable powers and find that principles of equity in this case disfavor the forfeiture of the defendant's right to possession of the premises. The trial judge "had the opportunity to view the witnesses' demeanor, as well as to listen to their testimony. In this fact-intensive case, [he] was in the best position to assess the credibility of the witnesses and to determine the facts." Jonjame Realty Trust v. Ryan, 2011 Mass. App. Div. 16, 17, quoting Millennium Equity Holdings, LLC v. Mahlowitz, 456 Mass. 627, 636-637 (2010). We review the judge's imposition of equitable remedies under an abuse of discretion standard. Demoulas v. Demoulas, 428 Mass. 555, 589 (1998). "[A] judge's discretionary decision constitutes an abuse of discretion where [the reviewing court] conclude[s] the judge made a clear error of judgment in weighing the factors relevant to the decision, . . . such that the decision falls outside the range of reasonable alternatives" (quotation and citation omitted). L.L. v. Commonwealth, 470 Mass. 169, 185 n.27 (2014).

It is well established that "equity does not favor a forfeiture." Howard D. Johnson Co. v. Madigan, 361 Mass. 454, 456 (1972). In Enos Sys., Inc. v. Eno, 311 Mass. 334 (1942), the Supreme Judicial Court held: "The decisions of this court have followed the general principle that equity does not favor a forfeiture. Relief against forfeiture has been granted although a lessee has failed to pay rent at the times and in the manner designated by the lease and even if such failure has been wilful and intentional, or where the lessee has breached a collateral covenant to repair or to furnish fire insurance and such breach has been due to accident or mistake and no harm has resulted to the lessor, or where, if the lessor was harmed, the damage could be readily ascertained and compensation paid so that the lessor would be put in the same position as if no such breach has occurred." Id. at 338. See also Finkovitch v. Cline, 236 Mass. 196, 199 (1920) ("Equity grants relief to tenants against forfeiture for breach of a covenant to pay rent even though the failure to pay is willful on the part of the lessee."); Howard D. Johnson Co., supra at 458 (willful withholding of rent does not foreclose equity relief from forfeiture).

On the other hand, the Court in Enos Sys., Inc. further stated: "But where the conduct of a lessee has been such as not to commend itself to a court of equity or where the circumstances of a particular case are such that the granting of relief would impose an unjust and unreasonable hardship on the lessor, then a forfeiture has not been set aside." Id. at 338. Put another way, "Where the actions of the party failing to perform are wilful and show bad faith, relief against forfeiture will not be granted." DiBella v. Fiumara, 63 Mass. App. Ct. 640, 646 n.7 (2005), citing Finkovitch, supra at 200 (persistent and deliberate hanging of laundry on front of house was "calculated to exasperate and provoke the other party to the contract and to promote corrosive influences in the community"), and Cooley v. Bettigole, 1 Mass. App. Ct. 515, 526 (1973) (commercial tenant's covering of hole in window in offensive manner was designed to irritate landlord).

Landlord urges this Appellate Division to take the position that the trial court abused its discretion in granting equitable relief because the circumstances of this

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case are such that equitable relief would be unjust and improper. Landlord suggests that payment could have been made from the $350,000 that Tenant received from the paycheck protection program. Landlord also asserts that that a claim of refusing to pay rent for an HVAC problem was raised after the problem was fixed. The Landlord in this case sought no damages, however. The sole loss to the Landlord was a delay in payment of three months' rent during a pandemic in which large sections of our economy and society were shuttered. At the time of the trial, the Tenant remained current on all rent. Upon review of the record, we cannot say that the judge abused his discretion by granting equitable relief in the circumstances of this case. [Note 3]

Judgment affirmed. Appeal dismissed.

So ordered.