In this action, Plaintiffs, David J. Apfel and Lisa Rechtschaffen, as trustees of The Penny Apfel-Rechtschaffen Nominee Trust, are challenging the status of a lot of registered land located within the BoldWater residential subdivision in Edgartown (Locus). Plaintiffs commenced this action by filing a four-count Verified Complaint on June 4, 2009, seeking declaratory relief under G. L. c. 231A. On June 25, 2009, Wayne A. Miller (Intervening Defendant or Miller) filed an Emergency Motion to Intervene. The motion was granted and Mr. Miller subsequently filed an Answer. [Note 1]
In Count I of their Verified Complaint, Plaintiffs seek a declaration that certain registered covenants filed in 1985 and 2005 (85 Covenants and 05 Covenants, respectively) are valid and enforceable against Locus, now owned by Miller. [Note 2] Count II seeks two separate declarations; first, a declaration that the division of land creating Locus was invalid because it was done in violation of the 85 Covenants; and second, a declaration that the original transfer of Locus to Thomas C. Wallace (Wallace) was invalid because it was a transfer of an illegally created lot. [Note 3] Count III seeks a declaration that certain mortgages of record affecting title to Locus are invalid, insofar as their mortgagors title is in question. [Note 4] Count IV seeks a declaration that Locus is not an independently buildable lot and that the only parties who can build on Locus are the owners of abutting parcels.
The case came before the court on Intervening Defendant Millers second Motion for Summary Judgment filed on March 31, 2011, on all counts in Plaintiffs Verified Complaint (Summary Judgment Motion) and Plaintiffs Cross-Motion for Partial Summary Judgment on Count II, filed on May 4, 2011 (Cross-Motion). Also before this court is Millers Motion to Strike Exhibits A through N in Plaintiffs Appendix, filed on May 17, 2011, in response to the Cross-Motion. As an initial matter, the Motion to Strike Exhibits A through N in Plaintiffs Appendix hereby is DENIED. [Note 5]
Essentially, Plaintiffs primary legal arguments in this action are: (1) that the division of Lot 2 into Locus and Lot 8 violated the 85 Covenants and, therefore, Locus is not a legal, buildable BoldWater lot; [Note 6] (2) the 05 Covenants are a product of mistake because the signatories to the 05 Covenants did not intend to ratify or endorse Locus as an independent BoldWater lot; and (3) as BoldWater lot owners, Plaintiffs have standing to enforce the 85 and the 05 Covenants.
Millers major challenges to Plaintiffs action as set forth in his Answer dated March 29, 2010, and submissions in connection with these motions are: (1) Plaintiffs are without standing to contest the alleged breach of the 85 Covenants and are without standing to seek reformation of the 05 Covenants; (2) the subdivision of Lot 2 into Locus and Lot 8 did not violate the 85 Covenants; (3) the 05 Covenants render Locus a buildable lot and are not a product of mutual mistake, subject to rescission or reformation; and (4) the 10 Amendments to the 05 Covenants further affirm and ratify the validity of Locus as an independent, buildable BoldWater lot. [Note 7]
In addition to the parties briefs and submissions filed in compliance with Land Court Rule 4, the summary judgment record contains over fifty combined affidavits and exhibits. A hearing on the parties cross-motions was held on May 24, 2011, at which all parties were heard. For the reasons set forth below, this court finds that Defendants Summary Judgment Motion is GRANTED and Plaintiffs Cross-Motion is DENIED.
This case is ripe for summary judgment based on the following material facts which are not in dispute:
1. In 1985, a residential subdivision, referred to as BoldWater was created in Edgartown. On July 31, 1985, Wallace, acting in his capacity as President and Treasurer of BoldWater, Inc., the Massachusetts corporation holding title to all the land comprising the subdivision, executed a Declaration of Protective Covenants for BoldWater, Incorporated, Edgartown, Massachusetts, Covenants, Reservations, Restrictions and Easements (85 Covenants). Wallace, as President and Treasurer of BoldWater, Inc., was the sole signatory to the 85 Covenants. The Edgartown Planning Board approved the definitive plan creating the BoldWater subdivision (Subdivision Plan) evidenced by certificate dated September 11, 1984, and the 85 Covenants were registered in the Dukes County Registry District of the Land Court on November 1, 1985, as Doc. No. 19221. [Note 8]
2. The 85 Covenants were established for an initial term of twenty years.
3. Section 4.3.a.viii of the 85 Covenants referred to further subdivision of BoldWater lots, stating:
No Lot or combination of Lots shall be resubdivided so as to create any additional building lots, except as may hereinafter be approved by the ARC [Architectural Review Committee] and the Edgartown Planning Board. Any further division of land within the plans of land . . . approved by the Edgartown Planning Board shall require approval under the subdivision control law, Massachusetts General Law, chapter 41 . . . and the filing of a definitive plan for subdivision of land (Form C). Notwithstanding other provisions of the subdivision control law, no plan for further division of land shown on said plans shall be submitted or endorsed as a plan not requiring approval under the subdivision control law (Form A).
4. The Architectural Review Committee (ARC) was initially a function of the development entity, BoldWater, Inc., and its members were Wallace, Najeeb Halaby (Halaby) and Elizabeth Meyer, until the death of Halaby in 2003. The ARC operated under rules set forth in the 85 Covenants, which provide, among other provisions, that any failure of ARC to act within sixty (60) days of receipt of an application from a BoldWater lot owner would result in the application being deemed approved. See § 4.4.a.iv.B.(2).
5. On January 14, 1998, BoldWater deeded to Halaby Lot 2 on the Subdivision Plan (referenced in the 85 Covenants), comprising approximately 19.5 acres (Lot 2). The deed is registered as Doc. No. 41030.
6. On June 3, 1999, BoldWater deeded to Wallace the abutting Lot 1,on the Subdivision Plan (referenced in the 85 Covenants), comprising approximately nearly 4.5 acres (Lot 1). The deed is registered as Doc. No. 44463.
7. In or around 2001, Halaby submitted to the Edgartown Planning Board (Planning Board) a Form A application for an Approval Not Required (ANR) plan, subdividing Lot 2 into two lots to be numbered 7 and 8. On November 5, 2001, the Planning Board endorsed the ANR plan, as both lots 7 and 8 met the frontage requirement for zoning purposes. Lot 7 was approximately 4.5 acres (Locus or Lot 7) and Lot 8 was a parcel comprised of approximately 15 acres (Lot 8).
8. On January 10, 2002, Halaby deeded Locus to Wallace in consideration of $50,000. The deed is registered as Doc. No. 50342, and Wallace became the registered owner of Lot 1 under Certificate of Title No. 11200.
9. On June 11, 2002, the Land Court ordered the registration of a new subdivision plan, numbered 37340-C, recognizing the division of Lot 2 into Lots 7 and 8 pursuant to the ANR plan submitted by Halaby in 2001, and endorsed by the Planning Board.
10. By document dated August 23, 2003, the 85 Covenants were amended, restated, and extended for another twenty years. Between August 23, 2003 and October 2005, the requisite number of signaturesmore than two thirds of the BoldWater subdivision lot ownerswere collected and the new set of covenants, known as the Amended, Restated and Extended Declaration of Protective Covenants for BoldWater, Incorporated, Edgartown, Massachusetts, Covenants, Reservations, Restrictions and Easements (05 Covenants) were approved and registered as Doc. No. 00063790 on October 27, 2005.
11. The 05 Covenants included a list of BoldWater lots to which the covenants applied and included Lots 7 (a/k/a Locus) and Lot 8 in place of Lot 2, which previously had been listed in the 85 Covenants. See Article III, § 3.1 (Defining Existing Property to mean and refer to Parcels No . . . as shown on Plan 1 . . . and Parcels 7 and 8 as shown on Plan No. 4). Also, Lots 7 and 8 were listed in the definition section of the 05 Covenants. See Article II, § 2.13 (Defining Lot(s) to mean and refer to Parcels No . . . as shown on Plan 1 . . . and Parcels 7 and 8 as shown on Plan No. 4).
12. The 05 Covenants changed the subdivision process for BoldWater lots and allowed either a Form A (ANR) or Form C (subdivision) plan to be submitted to the Planning Board for approval to further divide a BoldWater lot, effectively amending the subdivision terms of § 4.3.a.viii of the 85 Covenants. [Note 9]
13. The 05 Covenants, like the 85 Covenants, permit the construction of one principal dwelling, one guesthouse and various outbuildings on each BoldWater lot. See § 4.3.a.viii.
14. During 2003 and 2004, Wallace entered into a series of loan transactions in connection with which he granted several mortgages on Locus and the abutting lot known as Lot 1. By mortgage dated June 30, 2003, Wallace granted a first mortgage on Locus to Clifford Meehan (Meehan), filed as Doc. No. 58874. A month later, on August 15, 2003, Wallace executed a second mortgage on Locus and a first mortgage on Lot 1 to the Plymouth Savings Bank (Plymouth Bank), filed as Doc. No. 59109. Plymouth Bank was later acquired by Eastern Bank, which became the holder of the Plymouth Bank mortgages. Finally, on March 25, 2004, Wallace gave a Promissory Note and second mortgage on Lot 1 and a third mortgage on Locus to Intervening Defendant Miller, filed as Doc. No. 60559.
15. In August 2007, Plaintiffs submitted a written offer to buy Lot 1 and Locus together from Wallace.
16. On or about August 30, 2007, Wallace sent a copy of the 05 Covenants to Plaintiffs.
17. The proposed sale fell through because of Wallaces inability to obtain a release from Intervening Defendant Miller of his mortgages.
18. In the summer of 2008, Eastern Bank began foreclosure proceedings on Lot 1 and ultimately noticed and scheduled a foreclosure auction to take place on September 10, 2008.
19. On September 9, 2008, just prior to the foreclosure, Miller filed a Verified Complaint in Superior Court, Plymouth County against Wallace, Meehan, Eastern Bank and others in an attempt to prevent the foreclosure. The case is still pending. See Miller v. Robert Bianchi, Thomas C. Wallace, et al., Plymouth Superior Court, Case No. PLCV2008-01194.
20. On September 10, 2008, Plaintiffs were high bidders at a foreclosure auction for Lot 1, alone, for a price of $1,950,000. Plaintiffs closed on Lot 1 and were conveyed the title by foreclosure deed dated September 29, 2008, registered on October 1, 2008, as Doc. No. 68942.
21. The proceeds of the foreclosure sale for Lot 1 were sufficient to retire the Eastern Bank Mortgages on both Lot 1 and Locus. And, on October 31, 2008, Eastern Bank released its second mortgage on Locus by a document filed as Doc. No. 69090.
22. After the sale, Plaintiffs owned Lot 1 and Wallace owned Locus subject to a first mortgage held by Meehan and second mortgage held by Miller.
23. In 2009, Meehan foreclosed on Locus with the foreclosure sale taking place on June 5, 2009. Miller was high bidder at a price of $425,000. By agreement between Miller and Meehan, Meehan took title giving Miller an option to purchase. And, on or about August 2009, Miller exercised his option and purchased the property from Meehan. [Note 10]
24. In 2010, the Second Amended Declaration of Protective Covenants (10 Amendments) were circulated to the BoldWater subdivision lot owners and signed by the requisite number of signatories needed to pass the 10 Amendments. Plaintiff was among the BoldWater lot owners to sign the 10 Amendments, which were registered on November 9, 2010, as Doc. No. 72444.
25. The 10 Amendments reiterated the list of lots within the subdivision including both Lot 7 (a/k/a Locus) and Lot 8. Additionally, the 10 Amendments create an outright restriction on the further division of BoldWater Lots.
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Rule 56(c) of the Massachusetts Rules of Civil Procedure . . . provides that a judge shall grant a motion for summary judgment if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law. Attorney General v. Bailey, 386 Mass. 367 , 370-71 (1982).
The moving party bears the burden of affirmatively showing that there is no triable issue of fact, even if that party would not have such a burden if the case were to go to trial. See Ng Bros. Constr., Inc. v. Cranney, 436 Mass. 638 , 644 (2002). The burden on the moving party may be discharged by showing that there is an absence of evidence to support the non-moving partys case. A complete failure of proof concerning an essential element of the non-moving partys case renders all other facts immaterial. Kourouvacilis v. GM Corp., 410 Mass. 706 , 711 (1991). [A]lthough [the] supporting material need not negate, that is, disprove, an essential element of the claim of the party on whom the burden of proof at trial will rest, it must demonstrate that proof of that element at trial is unlikely to be forthcoming. Id. at 714.
At the time Locus was created by an ANR plan in the winter of 2001-2002, all the lots within the BoldWater subdivision were subject to the duly executed and registered 85 Covenants. Under § 4.3.a.viii of the 85 Covenants, in order for a BoldWater lot to be divided, first the ARC had to approve the subdivision and second, a subdivision plan had to be filed with the Planning Board. In regard to the second requirement, the 85 Covenants explicitly specified that a subdivision plan had to be filed and that an ANR plan was not sufficient to divide a BoldWater lot.
In 2003 however, the 85 Covenants were amended, restated and extended for another twenty years. Over the next two years the requisite number of signaturesmore than two thirds of the BoldWater subdivision lot ownerswere collected and the new covenants were duly registered (the 05 Covenants). Under the 05 Covenants, ARC approval was still required to divide a BoldWater lot, however, the prohibition against dividing lots through an ANR process was eliminated. More specifically, a BoldWater lot owner could now divide his or her lot by filing either an ANR plan or a subdivision plan with the Planning Board.
It is important to note that when Plaintiffs bought their property in 2008, the 85 Covenants had expired and had been superseded by the 05 Covenants. Moreover, Plaintiffs were given a copy of the extant 05 Covenants prior to purchasing their property and had at least constructive notice of the covenants to which their property and other lots within the BoldWater subdivision would be bound.
I. ARC Approval
The first issue this court must address is Plaintiffs contention that the division of Lot 2 violated the 85 Covenants because the proposed division did not receive ARC approval. The ARC approval provision was retained in the 05 Covenants and is therefore informative to this decision. [Note 11] The summary judgment record does not contain any direct evidence of ARC approval for the division of Lot 2. Nonetheless, it is likely that there was such actual or implied approval since two of the three ARC membersWallace and Halabywere fully aware of and directly involved in the division of Lot 2.
In addition, there is a general principle in contract law that the whole of an instrument is to be looked at to determine the effect of each part of it. 17A Am. Jur. 2d Contracts § 375 (Supp. 2013), quoting Neilson v. Lagow, 53 U.S. 98, 109 (1891). When a contract is silent on a particular topic, one would look to the four corners of the document to ascertain its meaning. Id. Unless a different intention had been delineated, the procedure for ARC approval outlined in one area ought to be applicable to another. The provisions of the 05 Covenants themselves can therefore be used to overcome the lack of direct evidence of ARC approval.
Section 4.4.a.iv.B.(2) of the 05 Covenants titled, Automatic Approvals and Certificates of Approval, requires ARC approval for construction and improvements to BoldWater lots. In that context, the 05 Covenants provide for automatic approval in the absence of disapproval. More specifically, § 4.4.a.iv.B.(2) provides that if ARC disapproval is not forthcoming within sixty days then the request is considered approved. Here, the record includes a request for approval of the ANR Plan and there is no evidence that the application for ARC approval was denied within sixty days (or ever.) Given these circumstances and the involvement of two of the three ARC members in the division of Lot 2, this court draws a permissible inference that there was the requisite ARC approval for the ANR Plan creating Locus. [Note 12]
II. 85 Covenants
The division of any lot within a subdivision is subject to the provisions of G. L. c. 41, sections §§ 81k through 81 GG (the subdivision control law), the rules and regulations of the local planning board, and, if any exist, private covenants and restrictions duly recorded or registered that affect the lots within the subdivision. Under the subdivision control law, a fully vetted subdivision plan dividing a lot is not required for approval of lots with frontage greater than twenty feet, or more if specified by a municipality. See G. L. c. 41, § 81L. The Edgartown Zoning By-Law provides that a lot with frontage of fifty feet or greater may be divided without the filing of a subdivision plan. See Edgartown Zoning By-Law, Article 11.1. Therefore, as a matter of subdivision control law, the ANR plan filed by Halaby was sufficient to establish Locus as an independent lot because the Planning Board endorsed the ANR plan creating Locus, the endorsement of the plan was not appealed, and Locus had frontage of fifty two feet. See G. L. c. 41, § 81P. [Note 13]
The issue now before this court, however, is the effect of Halaby creating Locus through the use of an ANR plan, which divided Lot 2 in violation of the 85 Covenants. In their brief, Plaintiffs state that they have standing to enforce the 85 Covenants because as landowners in the BoldWater community [they] are entitled to enforce that communitys mutually restrictive covenants in the same manner as any other BoldWater landowner, regardless of how or from whom Plaintiffs acquired their ownership. [Note 14] Plaintiffs position that they can enforce the communitys restrictive covenants is correct, but the argument fails to consider that the 85 Covenants had been superseded by the 05 Covenants when Plaintiffs purchased their property in 2008. It follows that this court may not enforce the prohibition against ANR division in the 85 Covenants because, as a matter of law, restrictions that are no longer in effect cannot be enforced. See Brear v. Fagan, 447 Mass. 68 , 77 (2006), citing Stop & Shop Supermarket Co. v. Urstadt Biddle Props., Inc., 433 Mass. 285 , 289 (2001) (Holding that once the stated term of a restriction has expired or been replaced by a new instrument there is nothing left to enforce).
Therefore, this court is persuaded that Plaintiffs are not entitled to enforce the provisions of the 85 Covenants because they have been superseded by the 05 Covenants and there is nothing left to enforce. Id. Accordingly, Plaintiffs Cross-Motion for Partial Summary Judgment on this issue is DENIED, and Defendants motion on this issue is GRANTED.
III. 05 Covenants
As noted above, when Plaintiffs purchased their property in 2008, the 85 Covenants had expired and had been superseded by the duly registered 05 Covenants. The 05 Covenants include Locus and Lot 8 in place of Lot 2, the predecessor parcel that had been listed in the 85 Covenants, from which both Locus and Lot 8 were created. The definition section of the 05 Covenants, Article II, § 2.13 titled Lot(s) includes within its definition Parcels No. 7 and 8 on Plan No. 4 and the prior reference to Lot 2 in the 85 Covenants was removed. [Note 15] Article III, § 3.1 titled Existing Property, also expressly reference Locus and 8 as shown on Plan No. 4 in place of Lot 2. Therefore, on their face, the 05 Covenants describe Locus in the same manner and subject to the same limitations as all of the other lots within the BoldWater subdivision. [Note 16]
Nonetheless, Plaintiffs allege there was a mutual mistake, a misunderstanding by the nearly forty signatories to the 05 Covenants, whereby they unknowingly included Locus as a BoldWater lot. However, this court will not allow Plaintiffs reformation claim to advance any further because there is an absence of evidence to support their theory of mutual mistake. See supra at p. 8, citing Kourouvacilis, 410 Mass. at 711 (The burden on the moving party may be discharged by showing that there is an absence of evidence to support the non-moving partys case).
Reformation is available to parties where there has been a mutual mistake which is material to the instrument and where no rights of third persons are affected. See Mickelson v. Barnet, 390 Mass. 786 , 791 (1984) (internal citations omitted). The phrase a mutual mistake as used in equity, means a mistake common to all the parties to a written contract or instrument. Ward v. Ward, 70 Mass. App. Ct. 366 , n. 4 (2007) (internal citations omitted). The law is settled that equity will not reform a document on the ground of mutual mistake where it expresses, in language deliberately chosen, the meaning which one of the parties intended it to convey. Eno v. Prime Mfg. Co., 317 Mass. 646 , 650 (1945) (internal citations omitted). Reformation is also justified if the party knowing of a mistake fails to make it known to the mistaken party. See Torrao v. Cox, 26 Mass. App. Ct. 247 , 250 (1988); Eno, 317 Mass. at 650 ([A] mistake made by one party to the knowledge of the other is equivalent to a mutual mistake); see also Ward, 70 Mass. App. Ct. at n. 5 (As a general rule, reformation may be warranted not only by fraud or by mutual mistake, but also by a mistake of one party . . . which is known to the other party).
On this record, there is an absence of evidence concerning an essential element of Plaintiffs mutual mistake claim. More specifically, this record does not establish that the mistake was common to all parties. Plaintiffs submitted the affidavits of fourteen of the signatories to the 05 Covenants in support of their mutual mistake claim. [Note 17] In regard to these affidavits, Plaintiffs state that: the signatories appear to fall into two camps. The first camp is comprised of a very small number of lot owners who knew of the subdivision of [Lot 2], but believed it had been done to effectuate a land transfera redrawing of boundaries and nothing more. The second camp comprises the vast majority of BoldWaters owners, who knew nothing about the improper subdivision that created Lot 7, but believe they would have opposed the subdivision if they had known, and are sure they would not have tolerated the treatment of the extra lot created by the subdivision as an independently buildable lot. Plaintiffs Brief, at p. 16.
It is clear from the record, however, that Wallace, who participated in the creation, approval and circulation of the 05 Covenants, was aware that Locus was listed in the 05 Covenants. [Note 18] And, as noted above, Wallace signed and was a party to the duly registered 05 Covenants. As a result, Plaintiffs will not be able to sustain their burden to show the 05 Covenants were a product of mutual mistake because it cannot be said that the document failed to express the intent of all of the parties to the covenants.
In addition, the supporting materials demonstrate that Plaintiffs will be unable to prove that Wallace knew of the other signatories purported mistakes. On their face, the 05 Covenants were an endorsement of Locus as an independent BoldWater lot and identify Locus and Lot 8 as lots indistinguishable from any others within the community. Even if some of the parties were unaware that Locus and 8 had been created through endorsement of an ANR plan, these two lots were enumerated in the 05 Covenants and there is no evidence of an attempt to conceal their inclusion from the other lot owners during the two year period during which the 05 Covenants were circulated for signatures. The signatories to the 05 Covenants were tasked with understanding the meaning of the document they signed. Their failure to read, understand or question what was in the 05 Covenants was an assumption of the risk that the covenants contained the provisions that they believed them to contain, and the fact that the covenants did not is not a mistake that another party may be charged with knowing or anticipating. See Markell v. Sidney Pfeifer Foundations, 9 Mass. App. Ct. 412 , 440 (1980), and cases cited therein.
Accordingly, this court is persuaded that Defendants have met their burden at this stage and shown that there is an absence of evidence to support Plaintiffs reformation theory. Moreover, according to the affidavits submitted by Plaintiffs, the record indicates that the affiants had two different understandings of the meaning and intent of the 05 Covenants, both of them different from the plain meaning of the written words. In order to reform a written document based on mutual mistake it must be demonstrated that all of the parties share an understanding of its meaning which differs from the written language. See Ward, 70 Mass. App. Ct. at 369. Where, as here, they do not, the document cannot be reformed because there is no common understanding on what it should be reformed to state.
Rescission is an equitable remedy granted when there has been a mutual mistake of fact or fraud between the parties. The purpose of rescission is to place the injured party in status quo ante [the way things were before]. Cummings Case, 52 Mass. App. Ct. 444 , n. 8 (2001) (internal citations omitted). One who knowingly signs a writing that is obviously a legal document without bothering to ascertain the contents of the writing is ordinarily bound by its terms, in the same manner as if he had been fully aware of those terms, unless it can be proved that he was induced to sign it by fraud or undue influence. That he does not know the terms that he is agreeing to is not a mistake, but a conscious choice and a known risk. Such a document is not ordinarily subject to rescission. Markell, 9 Mass. App. Ct. at 440 (internal citations omitted).
This court is therefore persuaded that Plaintiffs cannot rescind the 05 Covenants based upon the other signatories unilateral mistaken belief as to [the 05 Covenants] legal effect and consequence. See generally Ward, 70 Mass. App. Ct. 366 (Holding that Plaintiff could not rescind the deed at issue based upon Plaintiffs unilateral mistaken belief as to its legal effect and consequence); see also Taylor v. Buttrick, 165 Mass. 547 , 549-551 (1896) (The court declined to rescind a deed, as part of a trust, based on a unilateral mistake of law or lack of understanding the full effect of the deed). If this court were to hold otherwise, the reformation or rescission of a contract based solely upon proof of one partys mistake as to its legal effect would impose upon the other party a contract for which he had not bargained. Ward, 70 Mass. App. Ct. at 370 (internal citations omitted).
Accordingly, this court finds and holds that Plaintiffs are not entitled to reform or rescind the 05 Covenants because there is an absence of evidence to support Plaintiffs theory of mutual mistake. [Note 19]
It is important to note that Wallaces intent to have Locus exist as an independent lot would be irrelevant if the other signatories purported mistake was caused by Wallaces intentional misrepresentation or fraud. See Ward, 70 Mass. App. Ct. at 370 & n. 5 ([C]ontracts and deeds may be rescinded or reformed where there has been fraud by one party to the transaction). But, similar to their reformation theory, Plaintiffs cannot establish that the 05 Covenants were a product of fraud because nothing in this record establishes an inducement on the part of Wallace to deceive the other signatories.
The plain language of the covenants included Lot 7 (a/k/a Locus), and Lot 8 in multiple places throughout the document. There is no factual allegation that during the two years the covenants were being circulated for signatures, Wallace attempted to hide or conceal the fact that Locus and Lot 8 were so listed. Also, none of the other signatories from whom Plaintiffs have obtained affidavits speak to any fraud or alleged misrepresentation by Wallace and Plaintiffs have not specifically pled nor sought relief based upon fraud. The record before this court would be inadequate to allow a claim based on fraud to advance. See supra at p. 8, citing Kourouvacilis, 410 Mass. at 711, and accompanying text. Accordingly, in the absence of fraud, one who signs a written agreement is bound by its terms whether he reads and understands it or not. Haufler v. Zotus, 446 Mass. 489 , 501 (2006).
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The enumeration of Locus and Lot 8 in place of Lot 2 in both the 05 Covenants and the 10 Amendments, as well as the registration of both documents after they had been signed and notarized, twice ratified Locus as a lot within the BoldWater subdivision. The 05 Covenants were signed and notarized by more than the requisite two-thirds majority needed and were subsequently registered with the Land Court, thus binding all of the owners within the BoldWater subdivision and those purchasing lots to its terms. Plaintiffs were given a copy of the extant 05 Covenants prior to purchasing their property and had notice of the covenants to which their lot would be bound.
Accordingly, for the foregoing reasons, Millers Second Motion for Summary Judgment is GRANTED. Plaintiffs Cross-Motion for Summary Judgment on Count II of the Verified Complaint is DENIED.
Judgment to issue accordingly.
[Note 1] On June 3, 2010, the parties filed a stipulation dismissing Thomas C. Wallace from this action, as he no longer had an equitable interest in Locus.
[Note 2] See fact paragraph one (1) for a definition of 85 Covenants and fact paragraph ten (10) for a definition of the 05 Covenants.
[Note 3] Plaintiffs also argue that the invalid transfer resulted in a cloud on Wallaces title to Locus.
[Note 4] Count III refers to the mortgages Wallace granted on Locus.
[Note 5] Additionally, there has been a series of motions filed throughout the course of this litigation, including but not limited to a motion for endorsement of lis pendens (allowed), motion to dismiss (denied), motion to remove and substitute defendants (allowed), Millers first motion for summary judgment (denied), and a motion for clarification with an order issued. The parties also made efforts to settle the case.
[Note 6] See fact paragraph five (5) and fact paragraph seven (7) for a definition of Lot 2 and Lot 8, respectively.
[Note 7] See fact paragraph twenty-four (24) for a definition of the 10 Amendments.
[Note 8] All references to registered documents are to this Registry District of the Land Court.
[Note 9] The provision regarding further division of lots again required approval of the ARC in addition to submitting a Form A or Form C plan to the Planning Board.
[Note 10] There were other transactions and litigation by and among the parties during this time frame which are not material to matter that is now before this court. Miller is the registered owner under Certificate of Title No. 12750.
[Note 11] See infra. at p. 12, citing Brear v. Fagan, 447 Mass. 68 , 77 (2006) and accompanying text.
[Note 12] The court is not constrained against making inferences in favor of one party over the other because the parties have cross-moved for summary judgment and declaratory relief, and this point is implicated in both parties motions.
[Note 13] The ANR endorsement does not mean that Locus was buildable.
[Note 14] See Plaintiffs Memorandum in Support of Cross-Motion for Summary Judgment and in Opposition to Second Motion for Summary Judgment of the Defendant Wayne A. Miller, at p. 24.
[Note 15] Plan 4 is defined in § 2.18.1 as Plan of Land in Edgartown, Mass., Surveyed for Najeeb Halaby, October 16, 2001 and is Registered as Plan No. 37340-C.
[Note 16] The 10 Amendments to the 05 Covenants, which were signed by Plaintiffs, do not change this language and also clearly describe Locus as a lot with all the same rights as any other lot in the subdivision.
[Note 17] There were nearly forty signatories to the 05 Covenants.
[Note 18] In 2001, Halaby filed an application for a building permit for a dwelling on Locus, which Wallace successfully completed in 2002.
[Note 19] Irrespective of the ability to prevail on their mutual mistake argument at trial, Plaintiffs lack the requisite standing to reform the 05 Covenants. Plaintiffs have standing to enforce the 05 Covenants because: (1) the covenants themselves bestow standing upon them as BoldWater lot owners and (2) there is a general rule that the immediate parties to an instrument, as well as their successors may claim enforcement of an instrument. See 05 Covenants, Article 8.3; G. L. c. 184, § 27. However, it is clear from the record that Plaintiffs do not seek to enforce the 05 Covenants; rather they are seeking to reform or rescind them. The equitable remedy of reformation of contract is available to contracting parties or their successors who stand in their shoes. Here, Plaintiffs derive their title from Wallace, and as such, they stand in his shoes. Wallace, who participated in the creation, approval and circulation of the 05 Covenants, was plainly aware that Locus was listed in the document. In 2001, Halaby filed an application for a building permit for a dwelling on Locus, which Wallace successfully completed in 2002. Were Wallace still the owner of Locus, he could not come into this court and claim that the 05 Covenants were a product of mutual mistake. It follows that Plaintiffs, who are Wallaces successors-in-interests, are similarly constrained.