Walsh Construction Company v. Demtech, LLC

UNITED STATES DISTRICT COURT

DISTRICT OF MASSACHUSETTS

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WALSH CONSTRUCTION COMPANY, )

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Plaintiff, )

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v. ) Civil No. 17-cv-11082-LTS

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DEMTECH, LLC, )

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Defendant. )

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ORDER ON MOTION FOR PARTIAL SUMMARY JUDGMENT (DOC. NO. 44)

March 3, 2020

SOROKIN, J.

Now before the Court is Defendant Demtech, LLC’s (“Demtech’s”) motion for partial

summary judgment. Doc. No. 44. The instant dispute arose out of demolition work performed

by Demtech in its capacity as a subcontractor hired by Plaintiff Walsh Construction Company

(“Walsh”) to demolish a bridge that was owned by the City of Boston. Doc. No. 46 ⁋ 2. During

the April 2015 explosions carried out by Demtech, several of the City’s piers sustained damage.

Id. ⁋ 13. Walsh, which was contractually obligated to repair any damage caused to the piers

pursuant to its own contract with the City, self-performed repair work and now seeks to recover

$1,909,564.68 from Demtech. Id. ⁋ 16. Demtech now moves for partial summary judgment as

to three of Walsh’s claims: its quantum meruit claim (Count Two); its negligence claim (Count

Three); and its claim brought under Mass. Gen. Laws ch. 93A (Count Seven). Doc. No. 45 at 1.

At the outset, the Court ALLOWS Demtech’s motion for summary judgment as to Count

Two as “Walsh agrees to the dismissal of its quantum meruit claim.” Doc. No. 52 at 7.

As to Walsh’s negligence claim, Demtech argues that the claim is barred by

Massachusetts courts’ adherence to the traditional “economic loss doctrine,” which holds “that

purely economic losses are unrecoverable in tort . . . actions in the absence of personal injury or

property damage.” R.L. Whipple Co. v. Pondview Excavation Corp., 887 N.E.2d 1095, 1097

(Mass. App. Ct. 2008) (quoting FMR Corp. v. Boston Edison Co., 613 N.E.2d 902, 903 (Mass.

1993)). However, Walsh argues “that economic loss doctrine does not apply to Walsh’s

negligence claim because Walsh’s damages flow from physical loss to a third-party’s property

([the] City’s Piers), which was in the exclusive possession and control of Walsh.” Doc. No. 52

at 7. This exception applies, in Walsh’s telling, because Walsh acted as a “bailee [that] is

entitled to sue a third party who cause[d] injury to or the loss of the bailed property [that was] in

its possession.” Priority Finishing Corp. v. LAL Const. Co., 667 N.E.2d 290, 292 (Mass. App.

Ct. 1996).

Walsh’s argument fails. Under Massachusetts law, a bailment has been defined as

the delivery of personal property by one person to another in trust for a specific

purpose, with a contract, express or implied, that the trust shall be faithfully

executed, on the property returned or duly accounted for when the special purpose

is accomplished, or kept until the bailor reclaims it.

Omni-Wave Elecs. Corp. v. Marshall Indus., 127 F.R.D. 644, 650 (D. Mass. 1989) (quoting 8

Am. Jur. 2d, Bailments § 2 at p. 738 (1980)) (applying Massachusetts law). As Demtech rightly

argues, the property at issue in this dispute is real property, not personal property. See Samuel

Williston & Richard A. Lord, 19 Williston on Contracts § 53 (4th ed. 1990) (“Although

possession of real property may be delivered by the owner to another, the term ‘bailment’ is not

applied to such a transaction.”). Moreover, a proper bailment involves the “delivery of goods by

their owner to another for a specific purpose, and the acceptance of those goods by the other,

with the express or implied promise that the goods will be returned after the purpose of the

delivery has been fulfilled.” In re Complaint of Martin, 596 F.Supp.2d 142, 161 (D. Mass.

2009). Here, there was no “delivery” of the bridge and piers at issue in the dispute. Thus, a

conclusion here that Walsh was a bailee, or that Walsh was sufficiently like a bailee to invoke

the relevant exception to the economic loss doctrine, would “extend Massachusetts law beyond

what is supported by existing authority.” RFF Family P’ship, LP v. Ross, 814 F.3d 520, 535 (1st

Cir. 2016); see also Doe v. Trustees of Bos. Coll., 942 F.3d 527, 535 (1st Cir. 2019) (“Federal

courts are not free to extend the reach of state law . . . A litigant who chooses federal court over

state court cannot expect this court to blaze new and unprecedented jurisprudential trails as to

state law.”) (internal quotation marks omitted); Braga v. Genlyte Grp., Inc., 420 F.3d 35, 42 (1st

Cir. 2005) (“A federal court sitting in diversity must ‘take care not to extend state law beyond its

well-marked boundaries in an area . . . that is quintessentially the province of state courts.’”

(quoting Markham v. Fay, 74 F.3d 1347, 1356 (1st Cir.1996))).

In any event, the undisputed material facts, even drawing all reasonable inferences in

Walsh’s favor, demonstrate that Walsh did not have sole possession and control of the bridge and

piers. As Demtech notes, STV, an engineering firm with its own independent agency

relationship with the City, had access to the bridge throughout the demolition project, with STV

employees walking the bridge with local government officials on several occasions. Doc. No.

58-4 (demarcating “Department of Public Works, City of Boston” as the “owner” of the “Long

Island Bridge”). While it is true that “a bailee properly may delegate to another the performance

of the services required with respect to the bailed property,” Little, Brown & Co. (Inc.) v. Am.

Paper Recycling Corp., 824 F. Supp. 11, 16 (D. Mass. 1993), Walsh did not “delegate”

engineering tasks to STV; rather, as Demtech observes, STV carried out its duties “as an agent of

. . . the City of Boston.” Doc. No. 57 at 2. Such independent access exemplifies the “significant

differences between a bailee and a contractor like [Walsh]. While the latter exercises some

control, he shares it with others; a bailee, on the other hand, retains exclusive dominion.” A.

Shapiro Realty Corp. v. Burgess Bros., 491 F.2d 327, 332 (1st Cir. 1974). Without such

“exclusive dominion,” the relevant exception to the economic loss doctrine is inapplicable.1

Accordingly, Demtech’s motion for summary judgment as to Count Three is ALLOWED.

As to Walsh’s Chapter 93A claim, courts have unequivocally held that “unlike a

consumer plaintiff under § 9, a plaintiff under § 11 needs to show something more than a mere

breach of warranty to adequately plead a Chapter 93A violation.” Utica Nat. Ins. Grp. v. BMW

of N. Am., LLC, 45 F. Supp. 3d 157, 160 (D. Mass. 2014) (holding that such a plaintiff “must

invoke something more than a mere breach of warranty to plead a plausible Chapter 93A, § 11

claim, that is, it must allege a breach of warranty ‘plus,’ where that “plus” is conduct [that]

would render the breach repugnant to the milieu of the commercial marketplace”). As Walsh has

not alleged any such “plus” conduct, it cannot maintain a Chapter 93A action against Demtech.

Indeed, at the hearing on this motion, counsel for Walsh conceded that Walsh had no viable per

se breach of warranty claim under Chapter 93A.

1 Drawing all reasonable inferences in Walsh’s favor, the record does not establish exclusive

control over the bridge and/or piers, irrespective of whether the piers are characterized as real

property, fixtures to real property, or moveable objects resting on real property owned by the

City of Boston (that is, the bottom of the harbor). The contract provisions Walsh cites, see Doc.

No. 46-2, give Walsh various rights or responsibilities but do not vest it with exclusive legal

control over the property, especially as measured against the type of control exercised by a

bailee. Nothing in the contract provisions precludes the City or its agents from regular unfettered

access to the bridge or piers. In addition, the record does not support the conclusion that Walsh

in fact exercised exclusive control over the bridge or piers. As noted above, undisputed evidence

establishes a contractor of the City’s (not an agent of Walsh) regularly accessed the bridge or

piers. Doc. No. 57 at 2. And, nothing in the record establishes or permits a reasonable inference

that Walsh asserted exclusive control over the piers—for example, the piers were open and

unsecured to small or large craft.

Similarly, Walsh’s allegation that “Demtech’s attempts to disclaim liability for the

damage it caused to the Piers . . . is an unfair and deceptive trade practice” misapplies

Massachusetts law. Doc. No. 52 at 17. The Supreme Judicial Court of Massachusetts has

“emphasize[d] that Chapter 93A . . . has never been read so broadly as to establish an

independent remedy for unfair or deceptive dealings in the context of litigation, with the

statutory exception as to those ‘engaged in the business of insurance.’” Morrison v. Toys “R”

Us, Inc., 806 N.E.2d 388, 392 (Mass. 2004); see also Framingham Auto Sales, Inc., v. Workers’

Credit Union, 671 N.E.2d 963, 965 (Mass. App. Ct. 1996) (“Mere resistance to a just claim is not

the stuff of [Chapter] 93A, except where made such by statute . . .”). Indeed, Massachusetts

courts hold that “where the party, in good faith, disputes its obligation to make the payments,”

the unfair trade practice theory of liability is inapplicable. Zabin v. Picciotto, 896 N.E.2d 937,

963 (Mass. App. Ct. 2008). Walsh contends that Demtech not only breached its contractual

obligations but unfairly and deceptively attempted to foist liability off on Genesis or another

entity. But, other than the possible existence of a third-party claim by Demtech, nothing in the

summary judgment record supports an inference that Demtech’s disclaimer of liability was unfair

or deceptive. Accordingly, Walsh’s two theories of liability under Chapter 93A fail as a matter

of law; thus, Demtech’s motion for summary judgment as to Count Seven is ALLOWED.

For the foregoing reasons, Demtech’s motion for partial summary judgment (Doc. No.

44), is ALLOWED. Trial in this matter will commence on Tuesday September 29, 2020 at 9:00

a.m. and continue day-to-day thereafter. A separate pretrial scheduling order will issue. This

case is the only matter on for trial at the designated time.

SO ORDERED.

/s/ Leo T. Sorokin

Leo T. Sorokin

United States District Judge