PETER C. RAYMOND v. SM FINANCIAL SERVICES CORPORATION.

The court has before it the request of a defendant, who prevailed on summary judgment, for an award of attorney’s fees and costs, based on what defendant says was a thoroughly frivolous case brought by plaintiff. Plaintiff was placed in bankruptcy during the course of this litigation, and has died. Agreeing with the defendant that the case prosecuted against defendant lacked any merit, the court awards fees, and directs that they be paid by plaintiff’s counsel.

Plaintiff Peter C. Raymond filed this action on September 28, 2011. He sought a declaration pursuant to G.L. c. 231A that, by operation of G.L. c. 260, § 20, because twenty years had passed since an original money judgment against plaintiff entered in 1991, the judgment creditor’s [Note 1] later alias execution and levy on real estate [Note 2] was as a matter of law null and void, leaving the creditor with no title interest to the property. Plaintiff’s entire case depended on the benefit of this statute, which provides, that “[a] judgment or decree of a court of record of the United States or of any state thereof shall be presumed to be paid and satisfied at the expiration of twenty years after it was rendered.” On the strength of this enactment, plaintiff sought this court’s declaration that, given the passage of more than twenty years from the rendition of the original judgment against him, the judgment creditor was legally incapable of holding in the property any interest derived from the judgment. The defendant defended by demonstrating that a long and consistent line of appellate cases construe the statute as creating merely a rebuttable presumption of payment after twenty years, and fully authorize proof of nonpayment to defeat that presumption. The defendant also showed, without contradiction, that the debt embodied in the judgment, executions, and levies in fact had not been paid or satisfied.

On January 25, 2013, defendant filed a motion, and plaintiff filed a cross motion, for summary judgment pursuant to Mass. R. Civ. P. 56. Both parties opposed the request for summary judgment against them, and on March 28, 2013, the court (Piper, J.) held a hearing on the motions. At the hearing, for the reasons laid upon the record from the bench, and reflected in the docket entry made that day, the court granted defendant’s motion and denied plaintiff’s motion. Each party was instructed to submit a proposed form of judgment for consideration by the court.

Defendant later moved for an assessment of attorney’s fees and costs pursuant to G.L. c. 231, § 6F and Mass. R. Civ. P. 11(a), claiming plaintiff (and plaintiff’s counsel, Robert F. Casey, Esquire) acted in bad faith in maintaining this action without good ground to support it. Plaintiff filed an opposition. The motion for fees was not yet heard when, in September, 2013, defendant was placed in involuntary bankruptcy. The bankruptcy proceeding triggered an automatic stay of this action pursuant to 11 U.S.C. § 362.

Plaintiff passed away on October 22, 2013 and the bankruptcy proceeding was dismissed for that reason on November 2, 2013. [Note 3] That dismissal lifted the automatic stay in this proceeding. The court conducted a hearing with counsel to determine the action this court ought to take in light of the dismissal of the bankruptcy case following Mr. Raymond’s death. The court instructed each party to submit a memorandum discussing the effect of Peter Raymond’s death on defendant’s pending motion for attorney’s fees and costs, and addressing the question whether such an award might or should run against plaintiff’s counsel. The court has received and reviewed those memoranda. Neither party suggests that Peter Raymond’s death extinguishes defendant’s opportunity to seek attorney’s fees pursuant to Mass. R. Civ. P. 11(a). [Note 4] This court now rules on defendant’s motion for attorney’s fees and costs against Attorney Casey, and directs entry of judgment. [Note 5]

The relevant facts in this case are not in dispute. Plaintiff Peter C. Raymond was a defendant in a civil action brought by Gayle Carney-Connors in Concord District Court in 1990, and a money judgment entered against him in 1991 in the amount of $172,619.54. Plaintiff obtained an execution on the judgment, and a deputy sheriff levied on the execution, recording the lien against Peter Raymond’s real property title interest.

In 2009, Ms. Connors filed for bankruptcy. A second, or alias, execution (“Alias Execution”) issued in 2010. The Bankruptcy Court allowed the sale of the Alias Execution from the bankruptcy estate of Ms. Connors to the defendant in this proceeding, SM Financial Services Corporation (“SM”). [Note 6] SM brought in the the Concord Division of the District Court Department a request for supplementary process against Raymond, pursuing payment on the judgment and the Alias Execution. Raymond brought this action for declaratory judgment shortly thereafter, and the District Court proceedings were stayed pending its resolution.

Plaintiff contended in his verified complaint that the Alias Execution is facially void by operation of G.L. c. 260, § 20. Section 20 of G.L. c. 260 states in full: “A judgment or decree of a court of record of the United States or of any state thereof shall be presumed to be paid and satisfied at the expiration of twenty years after it was rendered.” However, as this court ruled at summary judgment (as memorialized in the March 28, 2013 docket entry):

G.L. c. 260, § 20, Which Statute Has Been in Force, in Substantially the Same Form, since the Early 19th Century, Is Not a Statute of Limitations or of Repose that Bars Recovery; Rather it Imposes a Presumption of Satisfaction on Judgments after Twenty Years.” See Denny v. Eddy, 39 Mass. (22 Pick.) 533, 534-35 (1839). This “presumption may always be rebutted by evidence showing that the [judgment] has not in fact been paid, but remains justly due.” Id. at 535. Subsequent Decisions of Courts of the Commonwealth have Followed Denny Consistently, Including Jenkins v. Andover Theological Seminary, 205 Mass. 376 , 382 (1910), Fino v. Municipal Court, 326 Mass. 277 , 281 (1950) (holding G.L. c. 260, § 20 “is not an absolute bar to action... but is a presumption which may be rebutted”), and Brown v. Greenlow, 330 Mass. 88 , 90 (1953). See also Hampton Properties, LLC v. Eresian, 29 Mass. L. Rptr. 416, 417 (2011).

The summary judgment record further shows that all but $7,200 of the Alias Execution has not been satisfied. Plaintiff did not contest the fact that he had not paid the substantial balance of his judgment debt; the statute’s presumption of payment had been rebutted fully.

In an electronic mail message dated November 14, 2011, defendant’s lawyer, Jonathan H. Allen, Esquire, provided plaintiff’s counsel with seven reported Massachusetts cases, including Denny, supra, that directly contradicted the position taken by plaintiff in this suit--that G.L. c. 260, § 20 as matter of law insulated the Acton property’s title from the reach of the judgment, based only on the passage of time and notwithstanding the apparently undisputed lack of payment. Attorney Allen urged Attorney Casey to perform his own research and to offer any case law that would support his argument. As this court made clear at summary judgment, Attorney Casey never provided any:

[The] Court is Not Aware, and Plaintiff Has Not Provided, Any Case Law or Treatise That Causes the Court to Question the Continuing Validity of the Cases Cited, Which the Court is Obliged to Follow, or Some Trend in the Jurisprudence That Could Form a Good Faith Basis to Report this Case, or Seek Appellate Guidance Whether to Depart from the Interpretations Provided by These Longstanding Decisions of Our Supreme Judicial Court.

Defendant filed this motion for attorney’s fees and costs for violation of Rule 11(a) because Attorney Casey failed “to articulate or cite any good ground to support the claim” brought on behalf of Peter Raymond. Defendant’s Motion for Assessment of Attorney’s Fees and Costs, p. 2.

* * * * *

Rule 11(a) states: “the signature of an attorney to a pleading constitutes a certificate by him that he has read the pleading; that to the best of his knowledge, information, and belief there is a good ground to support it; and that it is not interposed for delay.” Mass. R. Civ. P. 11. This “good ground” requires “reasonable inquiry and an absence of bad faith” when preparing a pleading. Tilman v. Brink, 74 Mass. App. Ct. 845 , 851 (2009); Doe v. Nutter, McClellan & Fish, 41 Mass. App. Ct. 137 , 141-42 (1998); Bird v. Bird, 24 Mass. App. Ct. 362 , 368 (1987). While Rule 11(a) “is not intended to chill an attorney’s enthusiasm or creativity in pursuing factual or legal theories,” Van Christo Advertising, Inc. v. M/A-COM/LCS, 426 Mass. 410 , 418 (1998), the rule certainly does not give an attorney permission to bring knowingly a meritless claim. Rule 11 "does not excuse ‘willful ignorance’ of facts and law which would have been known had the attorney simply not consciously disregarded them.” Id. at 416-417.

Rule 11 does not discuss specific sanctions, but the Supreme Judicial Court has stated that the rule “authorizes a judge to impose attorney’s fees and costs where an attorney has failed to show a subjective good faith belief that the pleading was supported in both fact and law.” [Note 7] 426 Mass. at 416. Thus, there is a two part analysis in determining whether the actions of counsel violate Rule 11. Tilman, 74 Mass. App. Ct. at 851; Van Christo Advertising, Inc., 426 Mass. at 416-417. First, the position taken must have been meritless, or lacking “good ground to support it.” Tilman, 74 Mass. App. Ct. at 851; Doe, 41 Mass. App. Ct. at 141-142; Bird, 24 Mass. App. Ct. at 368. Second, the position must have been advanced in bad faith. Van Christo Advertising, Inc., 426 Mass. at 416-417.

The first prong of a Rule 11 violation is whether the claim is lacking “good ground to support it.” Tilman, 74 Mass. App. Ct. at 851; Doe, 41 Mass. App. Ct. at 141-142; Bird, 24 Mass. App. Ct. at 368. Good ground is lacking when a claim is meritless or frivolous, without support in fact or law. Tilman, 74 Mass. App. Ct. at 851; Doe, 41 Mass. App. Ct. at 141-142; Bird, 24 Mass. App. Ct. at 368. Here, the plaintiff’s only argument was that G.L. c. 260, § 20 acts as an absolute statute of limitations on payment of debt and enforcement of a judgment lien, once the judgment, paid or not, is more than twenty years old. The case law, however, is clear and consistent that G.L. c. 260, § 20 provides only a rebuttable presumption of payment and is not a statute of limitations. See Brown, 330 Mass. at 90; Fino, 326 Mass. at 281; Denny, 39 Mass. at 534-35. Plaintiff’s position is utterly without good ground because the law indisputably provides only a rebuttable presumption of payment, and the factual record shows that the presumption was fully rebutted--Mr. Raymond did not satisfy the judgment debt with any payment beyond $7,200. See Tilman, 74 Mass. App. Ct. at 851; Van Christo Advertising, Inc., 426 Mass. at 413-414.

The second prong of a Rule 11 violation is bad faith. Van Christo Advertising, Inc., 426 Mass. at 416-417. Bad faith is demonstrated by willful ignorance of Rule 11 and its requirements. Psy-Ed Corp., 62 Mass. App. Ct. at 113. Rule 11 requires an attorney to make a reasonable inquiry to establish that a pleading bearing his or her signature is supported by good ground. Tilman, 74 Mass. App. Ct. at 851; Doe, 41 Mass. App. Ct. at 141-142; Bird, 24 Mass. App. Ct. at 368. Here, the case law is so clear in this area that Attorney Casey should have recognized this to be a baseless complaint from the start. See Van Christo Advertising, Inc., 426 Mass. at 416- 417, 420-421; see also Community Nat’l Bank v. Dawes, 369 Mass. 550 , 557 n. 6 (1976) (“Mass. R. Civ. P. 11(a)... imposes an obligation on attorneys in this Commonwealth to ensure that sham pleadings are not employed”). His failure to do so rises above mere ignorance and constitutes bad faith because it reflects Attorney Casey’s willful and conscious disregard of the applicable law, as set forth in the unswerving jurisprudence handed down by the appellate courts of the Commonwealth. Van Christo Advertising, Inc., 426 Mass. at 416-17 (“our rule does not excuse an attorney's ‘wilful ignorance’ of facts and law which would have been known had the attorney simply not consciously disregarded them.”).

Even if the court were to forgive Attorney Casey’s initial filing of a complaint without good ground, it cannot ignore the bad faith Attorney Casey demonstrated with his continued disregard for clearly established case law. Id. at 421. After the initial filing, and well before the time and expense of summary judgment, opposing counsel sent Attorney Casey citation to precedent clearly contradicting plaintiff’s position. Doe, 41 Mass. App. Ct. at 142 (holding rule 11 sanctions appropriate when “plaintiffs’ counsel had been furnished with case law” informing counsel plaintiff’s claim “did not give rise to a cause of action.”). Nonetheless, Attorney Casey dragged the meritless claim through motion practice, at a not insignificant cost to defendant. See Community Nat’l Bank, 369 Mass. at 557 n. 6; Tilman, 74 Mass. App. Ct. at 850-851.

Rule 11 is not violated when an attorney in good faith advocates on behalf of his client using viable legal theories in an effort to overturn a precedent. See Van Christo Advertising, Inc., 426 Mass. at 418. This is because Rule 11(a) “is not intended to chill an attorney’s enthusiasm or creativity in pursuing factual or legal theories.” Id. As the court made clear at summary judgement, however:

Plaintiff Has Not Provided, Any Case Law or Treatise That Causes the Court to Question the Continuing Validity of the Cases Cited, Which the Court is Obliged to Follow, or Some Trend in the Jurisprudence That Could Form a Good Faith Basis to Report this Case, or Seek Appellate Guidance Whether to Depart from the Interpretations Provided by These Longstanding Decisions of Our Supreme Judicial Court.

Plaintiff’s failure to provide support for his position violates Rule 11 because plaintiff’s claim is clearly contradicted by well established law, unsupported by the factual record, and not defended using any type of good faith “attorney’s enthusiasm” or “creativity in pursuing factual or legal theories.” Id., at 418, 421.

The courts are given discretion in sanctioning an attorney who has violated Rule 11. Cooter & Gell, 496 U.S. at 407; Van Christo Advertising, Inc., 426 Mass. at 417. Here, sanctions are appropriate because the defendant should not be required to bear the burden of the cost of a frivolous lawsuit commenced and maintained in bad faith by plaintiff and his counsel. See Van Christo Advertising, Inc., 426 Mass. at 417 (“rule 11 sanctions warranted where [party] continued to advocate claim despite knowledge that it was meritless.”).

The court considers, as well, that the lawsuit, lacking in merit, appears to have been “interposed for [among other improper reasons,] delay.” The interest of the judgment creditor, held at the time of suit by the defendant, rested only on the title of Mr. Raymond, and stood to evaporate, effectively, upon his death, given that the property’s title stood in the spouses as tenants by the entirety. Delaying the creditor’s meaningful access to the title it held, a result this litigation (combined with the ensuing bankruptcy) seems to have brought about, gave the plaintiff time to flout the judgment creditor’s title, which vanished when Mr. Raymond, who was ill for some time, did pass away. See note 3, supra. It would be hugely unfair to the defendant that, as a result in large measure of the meritless case leveled against it, it not only be kept from its rightful recovery on the judgment, but also be forced to pay its own counsel fees to defend against the baseless suit.

For the reasons stated in defendant’s motion for attorney’s fees and costs, and incorporated in this Order, the court finds that Attorney Casey willfully violated Rule 11(a) by filing and then persistently litigating plaintiff’s claim in bad faith, without good grounds to support it. This court determines that it is appropriate and necessary to impose these sanctions against Attorney Casey under Mass. R. Civ. P. 11(a), by making an award of attorney’s fees and costs, to be paid by plaintiff’s counsel.

Calculations of Attorney’s Fees and Costs

The court accepts the calculations put forth in the affidavit of defendant’s counsel, Jonathan H. Allen, Esquire, attached to defendant’s motion for assessment of attorney’s fees and costs. “The amount of a reasonable attorney's fee ... is largely discretionary with the judge, who is in the best position to determine how much time was reasonably spent on a case, and the fair value of the attorney's services.” Fontaine v. Ebtec Corp., 415 Mass. 309 , 324 (1993). See also Lydon v. Coulter, Massachusetts Appeals Court, No. 13-P-1272, slip op. (June 17, 2014)(rescript). Attorney Allen has provided a sufficiently detailed accounting of his fees for defending his client SM Financial Services, Corp. against Mr. Raymond’s baseless complaint. Attorney Allen has charged $275 per hour, for thirty-three hours of his time, and $150 per hour, for 4.10 hours of an associate’s time. [Note 8], [Note 9] Taking into consideration the experience and expertise of Attorney Allen and the fair use of time spent, this court accepts these rates and hours as reasonable and appropriate, and finds the total requested amount to be fair and worthy of award.

Accordingly, it is

ORDERED that all or substantially all of the claims made by Plaintiff Raymond were wholly insubstantial, frivolous, and not advanced in good faith. It is further

ORDERED that the judgment that the court will direct be entered in this action will order that the plaintiff’s counsel, Attorney Robert F. Casey, pay to the defendant SM Financial Services, Corp. its attorney’s fees and costs in the amount of $9,726.00, the amount which the court has, for the reasons set forth in this Order, determined to be fair and reasonable.

So Ordered.