MARIO NICOSIA & Another v. BURN, LLC, & Others

SUPREME JUDICIAL COURT

MARIO NICOSIA[1] & another[2] vs. BURN, LLC, & others[3]

Docket:

SJC-13755

Dates:

October 10, 2025 - December 16, 2025

Present:

Suffolk

County:

Budd, C.J., Gaziano, Kafker, Georges, Dewar, & Wolohojian, JJ.

Keywords:

Alcoholic Liquors, License, Alcoholic Beverages Control Commission. Boston Licensing Board. Municipal Corporations, Licensing board. Real Property, Lease. Contract, Performance and breach, Lease of real estate, Waiver. Waiver. Public Policy. Consumer Protection Act, Unfair or deceptive act. Practice, Civil, Summary judgment, Attorney's fees, Costs. Conversion.

Civil action commenced in the Superior

Court Department on January 24, 2020.

Motions for summary judgment were heard by

Peter B. Krupp, J., and the case was heard by Hélène Kazanjian, J.

The Supreme Judicial Court on its own

initiative transferred the case from the Appeals Court.

Kevin M. Considine (Alexander Furey also

present) for Burn, LLC, & others.

David Kelston (Noah Rosmarin also present)

for the plaintiffs.

The following submitted briefs for amici

curiae:

Albert L. Farrah for Suzanne Iannella.

Ben Robbins & Frank J. Bailey for

Pioneer New England Legal Foundation.

Joshua M. Bowman, Richard Heller, &

Scott McConchie for Spark Business Consulting, Inc.

KAFKER, J.

The primary issue presented in this case is whether a contractual

provision prohibiting the pledge of a license to serve alcoholic beverages

(liquor license or license) as collateral for a loan violates public

policy. N&M Trust VII (N&M)

leased a commercial property to Burn, LLC (Burn).[4] As part of the lease, N&M sold its liquor

license for the property to Burn for one dollar. The lease also prohibited Burn from pledging

the liquor license as collateral for a loan (anti-pledge provision), and

provided that any pledge constituted a default under the lease. The lease further required Burn to transfer

the license back to N&M for one dollar at the end of the lease term. Prior to the termination of the lease,

however, Burn pledged the license to its principal, Brian Lesser, as collateral

for a loan. When N&M discovered that

the license had been pledged to Lesser, N&M terminated the lease and

demanded return of the license.

The plaintiffs, Mario Nicosia,

individually and as trustee of N&M, and N.I.C. Limited Partnership,[5]

initiated the present suit against the defendants, Lesser, BL Note Holding

Tremont Street, LLC,[6] and Burn.

Following a grant of partial summary judgment and a jury-waived trial on

the remaining claims, a judgment awarding damages, attorney's fees, and costs

entered for the plaintiffs, and the defendants appealed. The defendants make four primary arguments on

appeal. First, the defendants argue that

the motion judge erred in granting summary judgment in favor of the plaintiffs

on their breach of contract claim because the anti-pledge provision is

unenforceable as against public policy.

Second, the defendants argue that the trial judge erred in finding for

the plaintiffs on their G. L. c. 93A, § 11, claim, because Burn

pledged the license to Lesser on the good faith belief that the anti-pledge

provision was unenforceable. Third, the

defendants argue that the trial judge erred as a matter of law in finding the

defendants liable to the plaintiffs for conversion of the liquor license when

Burn refused to cooperate with N&M to sell the license back. Fourth, the defendants argue that the trial

judge abused her discretion in awarding the plaintiffs attorney's fees and

costs.

We hold that (1) the anti-pledge

provision is enforceable because it does not violate G. L. c. 138,

§ 23, or public policy; (2) the record supports a determination that

Lesser, acting individually and on the behalf of all the defendants, willfully

and knowingly engaged in unfair and deceptive conduct when he falsely affirmed

under oath to the Boston licensing board (licensing board) and Alcoholic

Beverages Control Commission (ABCC) that the pledge agreement did not violate

or constitute a default of any other agreement; (3) Burn is liable for

breach of contract but not conversion of the license because N&M neither

possessed nor was entitled to immediate possession of the license at the time

Burn refused to cooperate with N&M to sell the license back; and

(4) the trial judge did not abuse her discretion in awarding the

plaintiffs attorney's fees and costs.[7]

1.

Background. a. Facts.

On August 2, 1996, N&M and Burn executed a written lease by which

N&M agreed to rent a commercial property in downtown Boston to Burn, a

prospective restaurant operator. In §

11.24 of the lease, N&M agreed to sell its liquor license for the property

to Burn for one dollar, and Burn agreed to seek regulatory approval for the

sale from the licensing board and ABCC.

Section 11.24 also contained the anti-pledge provision, which expressly

prohibited Burn from pledging or transferring the license without N&M's

prior written consent. Burn further

agreed in § 11.24 that it would "for one dollar . . . sell the

[license] to [N&M] upon expiration or earlier termination" of the

lease term, "obtain the approval of [the licensing board] and ABCC of the

resale of the [license] to [N&M]," and "execute all documents and

attend all hearings necessary to effectuate such sale." Section 11.24 expressly recognized that the

license was "subject to the jurisdiction of the [licensing board] and the

[ABCC]," and Burn agreed to "comply with [G. L. c. 138]"

and "all rules, regulations, orders and requirements of [the licensing

board] and ABCC relative to the sale of alcoholic beverages." The lease stated that Burn's violation of the

anti-pledge provision would constitute an event of default, permitting N&M

to terminate the lease and to seek specific performance and damages.[8]

As contemplated by the lease, N&M

transferred the license to Burn, and Burn submitted an application for the

transfer to the licensing board and ABCC.

The application, which included a copy of the lease, was signed by both

parties and noted that Burn would hold all direct beneficial or financial

interests in the license posttransfer.

After licensing board approval, the ABCC approved the transfer on

October 1, 1996. The parties renewed the

lease on substantially the same terms three times in the ensuing years, with

the last renewal extending the lease's term through 2022.

In 2018, Burn hired Lesser to manage its

business operations. Lesser thereafter

loaned Burn $445,000, and Lesser and Burn entered into a pledge agreement by

which Burn pledged the liquor license to Lesser as collateral for the

loan. In the pledge agreement, Burn

represented that the pledge would not "violate or constitute a default

under the terms of any agreement, indenture, or other instrument

. . . applicable to [Burn] or any of its property," despite the

anti-pledge provision in the lease. In

July 2019, Lesser caused Burn to apply to the licensing board and ABCC for

approval of the license pledge, which they granted. In this application, Lesser falsely affirmed

under oath that the pledge agreement, including the representation that the

pledge did not violate or constitute a default under any agreement, was truthful.

Nicosia and Lesser subsequently met to

discuss the lease on December 31, 2019.

The parties dispute what was said at the meeting, but according to

Nicosia, Lesser claimed that Burn owned the liquor license and then offered to

pay Nicosia $100,000 in a brown paper bag.

On January 7 and 8, 2020, the plaintiffs demanded by letter that the

defendants terminate the pledge on the license and gave notice of default and

termination of the lease. The plaintiffs

then initiated the present suit.

b.

Procedural history. The

plaintiffs' amended complaint alleged, among other things, that Burn committed

a breach of the lease, the defendants knowingly and willfully violated

G. L. c. 93A, and the defendants converted the license. The defendants counterclaimed for breach of

contract, conversion, and c. 93A damages.

On the parties' cross motions for summary

judgment, the motion judge granted the plaintiffs summary judgment on the

contract claims. In sum, the motion

judge concluded that the lease, including the anti-pledge provision, was

enforceable; Burn's pledge of the license to Lesser constituted a default under

the lease; and Burn was required to effectuate the sale of the license back to

N&M. The parties waived their rights

to a jury trial and detailed findings of fact on the remaining c. 93A and

conversion claims. After a bench trial,

the trial judge found for the plaintiffs on those claims and awarded treble

damages on the c. 93A claim. The

plaintiffs then requested $394,427 in attorney's fees and $14,192.64 in costs,

which the trial judge granted. The

defendants appealed, and we transferred the case to this court on our own

motion.

2.

Discussion. a. Enforceability of the anti-pledge

provision. i. Standard of review. We review the motion judge's grant of summary

judgment on the breach of contract claims, including his finding that the

anti-pledge provision is enforceable, de novo.

Federal Nat'l Mtge. Ass'n v. Hendricks, 463 Mass. 635, 637 (2012). "The standard of review of a grant of

summary judgment is whether, viewing the evidence in the light most favorable

to the nonmoving party, all material facts have been established and the moving

party is entitled to a judgment as a matter of law." Augat, Inc. v. Liberty Mut. Ins. Co., 410

Mass. 117, 120 (1991). "When both

parties have moved for summary judgment, as they did here, we view the evidence

in the light most favorable to the party against whom judgment was

entered." Wortis v. Trustees of

Tufts College, 493 Mass. 648 , 662 (2024).

ii.

Freedom of contract and public policy.

"[T]he general rule of our law is freedom of contract," which

"rests on the premise that it is in the public interest to accord

individuals broad powers to order their affairs through legally enforceable

agreements" (citations omitted).

Beacon Hill Civic Ass'n v. Ristorante Toscano, Inc., 422 Mass. 318, 320

(1996). Nonetheless, "public policy

sometimes outweighs the interest in freedom of contract, and in such cases the

contract will not be enforced."

Gattineri v. Wynn MA, LLC, 493 Mass. 13 , 19-20 (2023), quoting Feeney v.

Dell Inc., 454 Mass. 192, 199-200 (2009).

For a contract to violate public policy, "[t]he grounds for a

public policy exception must be clear in the acts of the Legislature or the

decisions of this court." Trustees

of the Cambridge Point Condominium Trust v. Cambridge Point, LLC, 478 Mass.

697 , 705 (2018), quoting Miller v. Cotter, 448 Mass. 671, 683 (2007). This requires a "court's conviction,

grounded in legislation and precedent, that denying enforcement of a

contractual term is necessary to protect some aspect of the public

welfare." Rawan v. Continental Cas.

Co., 483 Mass. 654 , 666 (2019), quoting Beacon Hill Civic Ass'n, supra at 321.

These general principles apply to

contractual waivers of statutory rights.

"A statutory right or remedy may be waived when the waiver would

not frustrate the public policies of the statute" but may not be waived

"if the waiver could 'do violence to the public policy underlying the

legislative enactment.'" Canal

Elec. Co. v. Westinghouse Elec. Corp., 406 Mass. 369, 377-378 (1990), quoting

Spence v. Reeder, 382 Mass. 398, 413 (1981).

"[T]he critical consideration in deciding if a particular statute

is reasonably interpreted to permit a waiver is whether doing so would

frustrate the purposes and policies that statute is designed to

advance." Garrity v. Conservation

Comm'n of Hingham, 462 Mass. 779, 787 (2012).

iii.

General Laws c. 138, § 23, and the anti-pledge

provision. General Laws c. 138 sets

forth the comprehensive licensing scheme that governs the issuance of licenses

to serve alcoholic beverages. The

overarching purpose of the statute is to ensure that the ABCC and the local

licensing authority review and approve each license application, such that no

license is granted without their review and approval. See Coyne v. Alcoholic Beverages Control

Comm'n, 312 Mass. 224, 227 (1942).

Indeed, "[t]he general policy is perhaps best indicated by the

first paragraph of § 23," Connolly v. Alcoholic Beverages Control

Comm'n, 334 Mass. 613, 619 (1956):

"The terms

licenses and permits . . . are . . . transferable only as

provided in this chapter, and revocable by the granting authority, the

commonwealth, acting through the same officers or agents and under the same

delegated authority for any violation of this chapter or any regulation adopted

by the commission or local licensing authority consistent with the terms of

this chapter after opportunity for a hearing.

The provisions for the issue of licenses and permits hereunder imply no intention

to create rights generally for persons to engage or continue in the transaction

of the business authorized by the licenses or permits respectively, but are

enacted with a view only to serve the public need and in such a manner as to

protect the common good and, to that end, to provide, in the opinion of the

licensing authorities, an adequate number of places at which the public may

obtain, in the manner and for the kind of use indicated, the different sorts of

beverages for the sale of which provision is made."

G. L.

c. 138, § 23, first par.

As part of this licensing scheme, the

statute expressly permits pledging a license as collateral for a loan with the

approval of the local licensing authority and ABCC. The final paragraph of § 23 states: "Any license granted under the

provisions of this chapter may be pledged by the licensee for a loan, provided

approval of such loan and pledge is given by the local licensing authority and

the commission." G. L.

c. 138, § 23, thirteenth par.

This provision grants license holders some financial flexibility but

ensures that the core purpose of the statute -- oversight by the local

licensing authority and ABCC -- is preserved.

The statute is silent on anti-pledge

provisions; they are neither expressly permitted nor expressly prohibited. Unlike provisions permitting pledges,

however, anti-pledge provisions do not result in the potential transfer of the

license to another party. Rather, they

do the opposite; they preclude pledges and thus foreclose the possibility of a

license transfer that has not been approved by the local licensing authority

and ABCC.

For these reasons, we can discern no clear

public policy implicated by the anti-pledge provision. The statute's core purpose is to establish

regulatory oversight, not to promote license pledges. Contractual arrangements, including financing

restrictions "among 'commercially sophisticated' parties do[] not

generally raise public policy concerns."

H1 Lincoln, Inc. v. South Wash. St., LLC, 489 Mass. 1 , 24 (2022), S.C.,

495 Mass. 484 (2025), quoting Canal Elec. Co., 406 Mass. at 374 . The terms of the lease here -- including the

anti-pledge provision -‑ were fully disclosed to the licensing board and the

ABCC, and the anti-pledge provision affects only the ability of the licensee to

use the license as collateral to secure a private loan.

Moreover, nothing about the anti-pledge

provision in this particular lease interferes with the licensing board and

ABCC's oversight. To the contrary, § 11.24

of the lease repeatedly emphasized the need for regulatory approval: the license was "subject to the

jurisdiction of the [licensing board] and the [ABCC]," Burn's sale of the

license back to N&M required "the approval of [the licensing board]

and ABCC," and Burn agreed to "comply with [G. L.

c. 138]" and "all rules, regulations, orders and requirements of

[the licensing board] and ABCC relative to the sale of alcoholic

beverages."

The defendants reason that this case is

controlled by Beacon Hill Civic Ass'n, 422 Mass. at 323 , where this court found

that a private agreement not to apply for a liquor license was unenforceable as

against public policy. But Beacon Hill

Civic Ass'n is inapposite because the agreement at issue there thwarted public participation,

another public policy of G. L. c. 138. In that case, a neighborhood civic

association agreed not to oppose a restaurant's application for a beer and wine

license in exchange for the restaurant's promise not to apply for an

all-alcohol license in the future. Id.

at 319 . We emphasized that "a

public policy of open public participation is implicit in the statutory

scheme," which requires published notice of license applications and a

hearing, and permits taxpayers to petition to modify, suspend, revoke, or

cancel a license. Id. at 321-322 . Accordingly, we held that because "the

right to participate in licensing proceedings is created by statute," and "the

application review provisions of c. 138 are grounded in general policy

concerns rather than protection of private property rights," the parties'

waivers "would destroy the very purpose of the statute" and were

therefore unenforceable (citation omitted).

Id. at 322-323 . Here, by

contrast, the anti-pledge provision does not interfere in any way with public

participation in the licensing process and is only a limitation on the

licensee's ability to use the license as collateral to secure a private loan

from a potential lender.

In sum, a contract provision prohibiting

the pledge of a liquor license as collateral for a loan is neither prohibited

by G. L. c. 138, § 23, nor "manifestly injurious to the

public interest and welfare" in violation of public policy (citation

omitted). Beacon Hill Civic Ass'n, 422

Mass. at 321 . We therefore affirm the

motion judge's determination that the anti-pledge provision is enforceable.

b.

General Laws c. 93A claims.

We next consider whether the trial judge properly concluded that the

defendants' conduct constituted "unfair or deceptive" conduct prohibited

by G. L. c. 93A, § 11, and whether any unlawful conduct was

"willful or knowing." The

defendants argue that the trial judge erred in finding the defendants liable

under c. 93A because Lesser believed, in good faith, that the anti-pledge

provision was unenforceable.

"Where a judge makes findings of fact

in a bench trial, we review them for clear error." H1 Lincoln, Inc., 489 Mass. at 13. By contrast, we review the trial judge's legal

conclusions de novo. Id. "[W]hether a particular set of acts, in

their factual setting, is unfair or deceptive is a question of fact. But whether conduct found to be unfair or

deceptive rises to the level of a chapter 93A violation is a question of

law." (Quotations and citations

omitted.) Id. at 13-14. Where, as here, the parties waived detailed

findings of fact under Rule 20(2)(h) of the Rules of the Superior Court (2018),

we review the judgment "according to the standard of review that would

apply to a verdict by a jury in a case tried to a jury and to the judgment

entered thereon." Rule 20(8)(b) of

the Rules of the Superior Court (2018).

That is, construing the evidence in the light most favorable to the

judgment, the question is whether "anywhere in the evidence, from whatever

source derived, any combination of circumstances could be found from which a

reasonable inference could be drawn in favor of the [parties that are not

challenging the judgment]." Motsis

v. Ming's Supermkt., Inc., 96 Mass. App. Ct. 371 , 379-380 (2019), quoting Dobos

v. Driscoll, 404 Mass. 634, 656 , cert. denied, 493 U.S. 850 (1989) (applying

standard in c. 93A case in which parties waived formal findings of fact

and rulings of law).

General Laws c. 93A, § 11, makes

unlawful an "unfair or deceptive act or practice" in the course of

dealings between those "engage[d] in the conduct of any trade or

commerce." Section 11 also permits

double or triple "actual" damages if the court concludes that the

conduct was willful or knowing.

G. L. c. 93A, § 11.

As we have repeatedly stated, "a breach of contract alone does not

amount to an unfair act or practice" for G. L. c. 93A,

§ 11, purposes (citation omitted).

H1 Lincoln, Inc., 489 Mass. at 17 n.12, 25. Rather, we look to whether the conduct

"is within at least the penumbra of some common-law, statutory, or other

established concept of unfairness . . . [or] is immoral, unethical,

oppressive, or unscrupulous" (quotations and citation omitted). Massachusetts Farm Bur. Fed'n, Inc. v. Blue

Cross of Mass., Inc., 403 Mass. 722, 729 (1989). Further, we have "repeatedly affirmed

that fraudulent misrepresentation is sufficient to establish deception under

G. L. c. 93A, § 11."

H1 Lincoln, Inc., supra at 18, citing McEvoy Travel Bur., Inc., v.

Norton Co., 408 Mass. 704, 714 (1990).

The evidence at trial was more than

sufficient to support the judge's determination that the defendants knowingly

and willfully engaged in unfair or deceptive acts. In particular, the record supported a

determination that Lesser knowingly lied under oath to the licensing board and

the ABCC when he swore in his application for approval of the license pledge

that the pledge did not "violate or constitute a default under the terms

of any agreement . . . applicable to [Burn] or any of its property." Lesser never told the regulators about his

purported belief that the anti-pledge provision was unenforceable. Instead, he falsely affirmed that the pledge

did not violate any other agreement, notwithstanding that his attorney had told

him that the license could not be pledged and that to do so would be a default

of the lease. Other evidence, including

his attempt to pay Nicosia $100,000 in cash in a brown paper bag for the

license, provides further support for the judge's factual determinations and

legal conclusions. For these reasons, we

affirm the trial judge's G. L. c. 93A judgment.[9]

c.

Conversion of the liquor license.

We next consider whether the trial judge erred as a matter of law in

finding the defendants liable to the plaintiffs for conversion of the liquor

license when Burn refused to cooperate with N&M to sell the license

back. The judge found that the

plaintiffs' damages for the conversion of the license were duplicative of those

awarded for Burn's breach of the lease and under G. L. c. 93A, and

thus our holding on this issue does not affect the total amount of damages

under the judgment.

In denying the defendants' motion for

summary judgment, the motion judge ruled that the defendants' failure "to

execute all documents and attend all hearings necessary to effectuate the sale

of the [l]icense to [N&M]" plausibly constituted conversion. Because the motion judge appears to have

found that § 11.24 of the lease provided a basis for the plaintiffs' conversion

claim, and this was the basis of the claim at trial, we turn to that provision

to evaluate the claim. We conclude, as a

matter of law, that Burn's refusal to cooperate with N&M according to the

terms of this provision constituted a breach of contract, but not conversion.

"To state a plausible claim of

conversion, a plaintiff must allege that the defendant wrongfully exercised

dominion or control over the personal property of the plaintiff." Hornibrook v. Richard, 488 Mass. 74 , 83

(2021), citing Weiler v. PortfolioScope, Inc., 469 Mass. 75, 87 (2014). Under Massachusetts law, a plaintiff

generally must either have actual possession of the converted property, Shaw v.

Kaler, 106 Mass. 448, 449-450 (1871), or be entitled to its immediate possession,

Robinson v. Bird, 158 Mass. 357, 360 (1893) (Holmes, J.), at the time of the

defendant's wrongful act. See J.R. Nolan

& L.J. Sartorio, Tort Law § 4.5, at 83 (3d ed. 2005) ("The key to

the plaintiff's [conversion] claim is his possession or right to

possession. . . . A

person who exercises serious dominion or control over personal property is

liable to one who had actual possession at the time of the act as well as to

one who was entitled to immediate possession at that time" [footnote

omitted]).

Here, the plaintiffs cannot state a claim

for conversion because when Burn refused to sell the license back to N&M,

N&M neither actually possessed nor was entitled to immediate possession of

the license. There were numerous

contractual and regulatory steps required before N&M could reacquire

possession of the license. In these

circumstances, the proper claim was for breach of contract, not conversion.

More specifically, in § 11.24 of the

lease, the parties agreed that "[N&M] has transferred its [license] to

[Burn] for one dollar and other good and valuable consideration." Thus Burn, and not N&M, was in possession

of the license when Burn refused to cooperate with N&M to sell the license

back. The cooperation required of Burn

was also delineated in the contract.

Burn would, "for one dollar . . . sell the [license] to

[N&M] upon expiration or earlier termination" of the lease term. Burn further agreed to "obtain the

approval of [the licensing board] and ABCC of the resale of the [license] to

[N&M]" and "attend all hearings necessary to effectuate such

sale." Such regulatory approval,

however, was beyond the control of Burn to grant. General Laws c. 138, § 23, second

par., also expressly states that "[n]o holder of [a liquor license] shall

have any property right in any document or paper evidencing the granting of

such [liquor license]."[10] As a

result, any transfer of the license between N&M and Burn could only have an

effect to the extent the licensing board and ABCC approved of the

transaction. At the time of the alleged

conversion, N&M was neither an approved licensee nor pledgee of the

license.

Such contractual rights leading to future

possession of property are insufficient to state a claim for conversion. See Laurin v. DeCarolis Constr. Co., 372

Mass. 688, 690-691 (1977) (where plaintiff had signed purchase and sale

agreement for real property, but title and possession of parcel had not yet

transferred to plaintiff, action for removal of trees, gravel, and loam on

parcel "must be decided, not as a tort action for . . . conversion

. . . , but as a claim for a deliberate and wilful breach of

contract"). For these reasons, the

plaintiffs' conversion claim fails as a matter of law.[11]

d.

Attorney's fees. The defendants

also appeal from the trial judge's award of $394,427 in attorney's fees and

$14,192.64 in costs,[12] on the grounds that the award is excessive and not

adequately documented. We disagree and

conclude that the trial judge's award was not an abuse of discretion. See Sutton v. Jordan's Furniture, Inc., 493

Mass. 728 , 742 (2024), citing LaChance v. Commissioner of Correction, 475 Mass.

757, 772 (2016) ("We review a judge's award of attorney's fees for an

abuse of discretion"). This case

took over four years to litigate and proceeded through summary judgment to a

jury-waived trial. The trial judge

assessed the plaintiffs' affidavits and verified billing records and

determined, based on the factors outlined in Linthicum v. Archambault, 379

Mass. 381, 388-389 (1979), that the time expended by the plaintiffs' counsel

was reasonable and supported by the record.

As we discern no abuse of discretion in that award, we affirm the trial

judge's award of $394,427 in attorney's fees and $14,732.64 in costs.[13]

3.

Conclusion. We hold that the

anti-pledge provision is enforceable and therefore affirm summary judgment in

favor of the plaintiffs on that ground.

We likewise affirm the G. L. c. 93A judgment and the award of

attorney's fees and costs in favor of the plaintiffs. We reverse the judgment against the defendants

for conversion of the liquor license.

So ordered.

footnotes

[1] Individually

and as trustee of the N&M Trust VII.

[2] N.I.C.

Limited Partnership.

[3] BL Note

Holding Tremont Street, LLC; Brian Lesser; Andrew Husbands; Timothy Maslow; and

Joseph Matzkin, interested party.

[4] Burn is the

successor entity to Burn, Inc., the original signatory of the lease.

[5] N.I.C.

Limited Partnership is the sole beneficiary of N&M and the record owner of

the leased premises. Mario Nicosia is

the sole owner and manager of both N.I.C. Limited Partnership and N&M.

[6] Lesser is the

sole manager of BL Note Holding Tremont Street, LLC.

[7] We

acknowledge the amicus briefs submitted by Suzanne Iannella, Pioneer New

England Legal Foundation, and Spark Business Consulting, Inc.

[8] The parties

simultaneously entered into a "negative pledge agreement," in which

Burn similarly covenanted not to pledge the license.

[9] We likewise

discern no merit to the defendants' argument that the denial of their motion

pursuant to Mass. R. Civ. P. 15 (b), 365 Mass. 761 (1974), to amend their

pleading to assert an affirmative defense based on c. 93A's safe harbor

provision was reversible error. The

defendants were allowed to present the defense at trial, despite the denial of

the rule 15 (b) motion to amend the answer, and the trial judge correctly

rejected the defense. More specifically,

the safe harbor provision exempts from c. 93A liability "transactions

or actions otherwise permitted under laws as administered by any regulatory

board or officer." G. L.

c. 93A, § 3. But the record

supports a determination that the regulators' approval of the pledge was

premised on Lesser's false statement that the pledge did not violate or

constitute a default under any agreement, which vitiates the significance of

the regulators' approval as a safe harbor; where the defendants hid their

unfair and deceptive conduct from the regulators, the regulators did not by

their approval give "affirmative permission" to engage in that

conduct. Aspinall v. Philip Morris,

Inc., 453 Mass. 431, 437 (2009).

[10] As we

conclude that the plaintiffs did not possess the license at the time of the

alleged conversion, we need not address the defendants' argument that there was

no property right in the license that could be converted.

[11] In Laurin,

372 Mass. at 690 , we suggested in dictum that even when a plaintiff lacks

actual possession or the right to immediate possession of converted property,

recovery for conversion may nevertheless be warranted if the plaintiff has a

"property interest in the converted property." See id. (regardless of plaintiff's possessory

right, "[w]e should uphold . . . recovery [for conversion] if it

would have been proper in an action of trespass on the case or in a suit in

equity"). See also Restatement

(Second) of Torts § 243 comment b, at 476 (1965) ("Under the common

law action of trover [a] plaintiff . . . entitled only to future possession,

as in the case of a bailor for a term, could not maintain the

action. . . . With the

disappearance of the forms of action, it is normally of little consequence,

except as a matter of pleading in a few jurisdictions, whether this action is

now to be called one for conversion or merely for damage to the future interest

. . ."). We nonetheless

conclude that contract and not conversion is the appropriate cause of action

here, given the multiple contractual and regulatory contingencies that must be

satisfied prior to N&M reacquiring possession of the license.

[12] An

additional $540 in filing fees included in the costs awarded is uncontested.

[13] The

plaintiffs have requested an award of appellate attorney's fees and costs in

their brief. As the prevailing party on appeal in a c. 93A, § 11,

action, the plaintiffs are entitled to recover reasonable attorney's fees and

costs. See H1 Lincoln, Inc., 489 Mass.

at 27 n.18 (citing cases). The

plaintiffs may file an appropriate application for appellate fees and costs in

this court, pursuant to the procedure established by Fabre v. Walton, 441 Mass.

9, 10-11 (2004).