EDWARD F. PERKINS, III and BRUCE A. WALSH v. FRANCIS G. GOULD et al.

This is a partition action pursuant to G.L. c. 241 regarding 26 Greenleaf Avenue (Partition Property), Oak Bluffs, Massachusetts. The Partition Commissioner (Commissioner) Candace A. Nichols, has brought a "Motion for Payments, Disbursements and Credits, and Allowance of First and Final Account" (Motion). By virtue of that Motion the Commissioner seeks, inter alia, the approval of various fees. The Office of the Attorney General on behalf of the Executive Office of Health and Human Services (Commonwealth) as intervenor has filed an opposition to the Commissioner's Motion together with a request for attorneys fees in the amount of $15,120. [Note 1] The Commonwealth opposes the Commissioner's request arguing that the amount sought by her cannot be justified by the work which she performed. The Commissioner argues that as her proposed accounting is appropriate, it should be granted as submitted. For the reasons that follow, this court will, for purposes of the First and Final Account[ing], allow each of the fee requests in part, and will order the allocation of proceeds as specified below.

Background

The Partition Property consists of an improved parcel of property on Martha's Vineyard. The said property has been used as a summer home on various occasions from 2006 to date by various co-tenants. There are in excess of 14 people or entities that possess an interest in the property. The ownership percentages are as follows: Frances G. Gould-4.15%; Dorothy E. Gould-1.85%; Louisa A. Gould-1.85%; Thomas Gould-1.85%; Elisa Parks Natichioni-2.78%; Samuel T. Parks-4.16%; Roswell J. Parks-2.78%; Edwin F. Perkins, III-11.81%; Amy Perkins Bent-11.81%; Jeff Perkins-11.81%; Holiday Walsh-11.81%; Bruce A. Walsh-11.81%; Heather Walsh-11.81%; Estate of George H. Gould-9.72%.

Inasmuch as a physical division of the property is not practical in the circumstances, this court appointed Candace A. Nichols as Partition Commissioner to determine the "proper percentage ownership interests in the Partition Property by all persons and entities set forth in the complaint" and to inform the court as to the "advisability, cost, timing, and specific methodology of ordering sale of the Partition Property by private sale to a third party, G.L. c.241 § 31; by public auction, id.; and/or by setoff." The governing statute, G.L. c.241, provides that when partition is by sale, "[t]he sale shall be made by public auction ... or the sale may be a private sale." The Commissioner determined that the proper method for the disposition of the locus, was to hold a "closed bid sale among known interested buyers with the property to be sold 'as is,'" to be followed by a public auction or marketing of the property for private sale if the closed bidding did not lead to a successful sale. To this end, the Commissioner as well as the Petitioner's attorney dedicated a not insubstantial amount of time to determining the lowest-acceptable price for the property and contacting potential bidders. The Commonwealth, which holds a lien on the 9.72% interest that the Estate of George Gould has in the property, moved to intervene to protect its interests and challenged the Commissioner's report. The Petitioners, the Estate of George Gould, and the Commissioner all objected to the intervention by the Commonwealth. The Commonwealth filed additional appraisals with the court that indicated that the property would sell on the open market for a significantly higher price than that proposed by the Commissioner.

This court issued a Warrant for the disposition of the property by private sale, directing that a co-listing be made with Ocean Park Realty and Coldwell Banker Landmarks Real Estate. Petitioners subsequently filed a Motion for Warrant, which was denied as a warrant for sale had already issued. The property was marketed successfully toward the end of 2012, for $710,000.

The Commissioner has filed a "Motion for Payments, Disbursements and Credits and Allowance of First and Final Account." That First and Final Account will be Allowed as amended by this Order.

The Commissioner is seeking fees and expenses in the amount of $38,702.86. Additionally, Petitioner's attorney seeks fees and expenses in the amount of $31,085.78. The Estate of George Gould has also submitted a request for attorney fees and expenses in the amount of $23,083.35. The Commonwealth opposes the payment of those requested disbursements from the proceeds of sale, while seeking payment of $15,120.00 from those proceeds. The court will address each of these fee requests in turn.

Fee Calculations

The Commissioner was instructed to determine the "manner and amounts in which proceeds of sale ought to be distributed to the parties and others who may be entitled, including mortgagees, subject to appropriate adjustments to be made as a result of 'all matters of accounting between parties in reference to common land...."' She requests that her fees and those of Petitioners' attorney be paid out of the sale proceeds prior to disbursement, and that the remaining funds be distributed according to the percentage interest that each party or entity holds. In her "Motion to Amend Accounting" filed on March 1, 2013, the Commissioner requests payment on behalf of the Estate of George H. Gould in the amount of $27,556.05 for "Administrator fees and expenses." [Note 2] The funds remaining to the Estate would be allocated to pay off the Commonwealth's lien. The Commonwealth would not be entitled to any fees or expenses under the Commissioner's proposed ac­ counting.

Partition commissioners "are entitled to reasonable charges for their services, to be determined by the court." G.L. c. 241 § 22; O'Riorden, Petitioner, 244 Mass. 472 , 476 (1923). Other expenses, including "the fees of counsel ... shall be determined by the court, and in case of sale paid by the commissioners out of the proceeds ...."G. L. c.241 § 22. The determination of what constitutes reasonable fees rests in the discretion of the trial judge. See McGrath v. Mishara, 386 Mass. 74 , 87 (1982); Berman v. Linnane, 434 Mass. 301 , 302-303 (2001). The Supreme Judicial Court has stated that the appropriate method of calculating reasonable fee amounts is to apply fair market rates to the time reasonably spent. Stratos v. Department of Pub. Welfare, 387 Mass. 312 , 321-322 (1982). However, the trial judge has the discretion to determine whether "deviat[ion] from the presumptive proportionate allocation" of the costs and expenses of a partition action is appropriate, given the circumstance. See Aiello v. Aiello, 63 Mass. App. Ct. 914 , 916 (2005).

The court has closely examined the materials submitted by all parties. In reviewing the Commissioner's invoices, the court is not convinced that the requested fees represent time reasonably spent. As noted sua sponte by the court, and also noted by the Commonwealth, the Commissioner spent a not insignificant amount of time seeking to implement her preferred method of sale-namely, a closed-door session with bidders that had been suggested by Petitioners' attorneys. This "closed bid sale" was not as contemplated by the statute, the decisional law, or by this court's appointing order. Therefore, the court concludes that the time spent in this pursuit was unwarranted and not reasonable. The Commissioner stated in her report that the "property has some major maintenance issues ... [t]here is no insulation ... [it] clearly needs sanding and painting ... [and] roof shingles were missing after the winter storms ... a new septic system will most likely be required." However, predicated upon the photos provided at the court's request, this court is not convinced that the noted deficiencies rose to the level of "major maintenance issues." Rather, it was this court's view that the condition of the property as depicted in the photographs allowed for a sales price greater than that proposed by the Commissioner.

Furthermore, the court notes that the Commissioner retained the services of her law partner to represent her at all court sessions regarding this case. As the Commissioner is an attorney herself, and was indeed chosen as partition commissioner based in no small measure upon her legal expertise, the court believes it to be unnecessarily duplicative to have an attorney represent the Commissioner. Additionally, the court is not prepared to allow payment of fees for such person or for mailing, typing, and other paralegal work as set out in the Commissioner's accounting. The court believes a reasonable fee for the work provided in this matter to be $25,000. With the addition of her expenses, the Commissioner is entitled to $26,127.86 from the proceeds of the sale.

The court has also reviewed the accounting and the fee request of Petitioners counsel. The court notes at the outset that this bill appears to have been substantially reduced prior to its submission herein. Although the Petitioners are entitled to recover fees pursuant to G.L. c.241, § 22, Aiello v. Aiello, 63 Mass. App. Ct. 914 , 916 (2005), those fees must be reasonable as well. After careful review of the accounting submitted with the request for fees, this court does not find that the Petitioners are entitled to the requested $31,085.78. Items which raise concern as to the reasonableness of the time spent include: the multiplicity of phone calls between the Commissioner and Petitioner's attorney, far more than should have been necessary for a relatively uncomplicated partition case; the tendency to hand deliver documents to the court rather than put them in the mail or have them delivered via the USPS, UPS or the like; the amount of time spent "reviewing" documents; and the billing of multiple attorneys for the same period of time or task. The court will also alter the rate at which Petitioners' attorneys billed. Petitioners' attorneys billed between $275 and $375 per hour (with one person billing at $175 per hour). The Commissioner is being compensated at a reasonable rate of $250 per hour. The court therefore, will reduce any hourly rate in excess of that amount, to $250 per hour. The court believes that $17,250.00 is a reasonable amonnt to be paid from the proceeds of sale.

As observed supra, the Estate of George Gould has also requested attorney's fees and expenses. This court is of the opinion that any such fees should be sought in connection with the pending Probate Court action once the proceeds of sale have been distributed and made available. The court notes in this regard that the statement submitted by the Estate includes funeral related expenses and pre-partition billings that are, in the view of this court, inappropriate for consideration in a partition action.

The Commonwealth has requested attorney's fees and expenses as well. This court is of the opinion that such payment lies within the contemplation of the relevant statute. See G.L. c.241 § 22 ("The reasonable expenses and charges of partition proceedings, including ... the fees of counsel ... shall be determined by the court."). In this case, the court believes that the Commonwealth is entitled to a measure of compensation. The Commonwealth's efforts to maximize the proceeds of sale contributed ultimately to the increased price realized on the sale of the Partition Property, i.e. a price which exceeds the Commissioner's initial estimate. The Commonwealth sought and obtained additional appraisals at no cost and generally advocated for a sales methodology which this court considers appropriate under the circumstances. Although the Commonwealth has requested an amount which, it asserts, represents one-half of the actual time spent on this matter, the court believes a reasonable fee to be $10,000.00, to be paid from the proceeds of sale.

Conclusion

For the foregoing reasons, the Commissioner shall receive $26,127.86, Petitioner's counsel shall receive $17,250.00, and the Commonwealth shall receive $10,000.00, from the net proceeds of sale. The Estate of George Gould is free to seek fees and expenses from its distribution, in the Probate Court. The remaining proceeds shall be divided among those holding an interest in the property, proportionate to their interests.

Accordingly, it is hereby

ORDERED that the Commissioner shall distribute the proceeds of sale in accordance with her First and Final Account as Amended by this Order. The distributions thereunder shall include the following: 1) $26,127.86 to the Commissioner; 2) $17,250 to the Petitioners Counsel; 3) $10,000 to the Commonwealth [Note 3] 4) $26,111.00 to Frances G. Gould; 5) $11,639.85 to Dorothy E. Gould; 6) $11,639.85 to Louisa A. Gould; 7) $11,639.85 to Thomas Gould; 8) $17,491.23 to Elisa Parks Natichioni; 9) $26,173.93 to Samuel T. Parks; 10) $17,491.23 to Roswell J. Parks; 11) $74,306.26 to Edwin F. Perkins, III; 12) $74,306.26 to Amy Perkins Bent; 13) $74,306.26 to Jeff Perkins; 14) $74,306.26 to Holiday Walsh; 15) $74,306.26 to Bruce A. Walsh; 16) $74,306.26 to Heather Walsh; and 17) $61,156.39 to the Estate of George H. Gould.

SO ORDERED.