Appendix — Berman & Sons, Inc. v. Scofield

FILED

DBE 26 1984

es ALEXANDER L STEVAS,

NO. ‘nova

preme Court, U

IN THE SUPREME COURT OF THE UNITED STATES

December Term, 1984

Berman & Sons, Inc., William J. Allen,

Martin S. Berman, and Lila Gross,

Appellants

Vv.

Lana J. Scofield and A. Larry Berren, on

behalf of themselves and all those

Similarly situated,

Appellees

ON APPEAL FROM THE SUPREME JUDICIAL COURT

OF MASSACHUSETTS

APPENDIX

JAMES B. FOX, Esquire

Counsel of Record

MITCHEL S. ROSS, Esquire

Bernkopf, Goodman & Baseman

99 High Street, Suite 2050

Boston, MA 02110

Tel: (617) 542-7070

OPINION OF SUPREME JUDICIAL COURT

OF MASSACHUSETTS ....-.-.--- Al

FINDINGS OF FACT, CONCLUSIONS OF

LAW AND ORDER RELATIVE TO

PLAINTIFFS' MOTION FOR PARTIAL

SUMMARY JUDGMENT AGAINST DEFENDANTS

BERMAN & SONS, INC., MARTIN S.

BERMAN and LILA GROSS . ..... + A23

AMENDED JUDGMENT OF HOUSING

COURT OF THE CITY OF BOSTON... . A76

ORDER OF SUPREME JUDICIAL COURT

OF MASSACHUSETTS .... « « « « « A7Q

NOTICE OF APPEAL . . . s . 2 . . . . A8l

=z

lel ellie i

EDITOR'S NOTE ;

PAGES A2 WERE POOR

HARD Ae Batra On FILMLNG.

IF AND WHEN A BETTER COPY CAN BE

OBTAINED, A NEW FICHE WILL BE

ISSUED.

= =

LANA J. SCOFIELD & others' vs. BERMAN & SONS, INC.

& others.’

Suffolk. Apnil 6, 1984. — October 3, 1984

Present: Hennessey, C.J., Witxins, Liacos, Lyncu, & O'Connor, JJ.

‘A. Larry Berren and other tenants who were members of the plaintutt

class.

*Martin S. Berman, Lila Gross, and William J. Allen.

-Al-

SS =

CivIL ACTION commenced in the Housing Court of the City

of Boston on May 12, 1977.

The case was heard by Patrick J. King, J.

After review was sought in the Appeals Court, the Supreme

Judicial Court ordered direct appellate review on its own initia-

tive.

Harvey S. Shapiro for the plaintiffs.

James B. Fox for the defendants.

Liacos, J. The defendants appeal from a judgment entered

in the Housing Court of the City of Boston declaring that the

defendants violated c. 15, § 9 (a), of the Boston Ordinances

of 1975 (c. 15), and Boston Rent Board Regulation 11, § 12(A)

(Regulation 11), by unlawfully increasing the rent charged to

the plaintiffs, tenants in rent-controlled apartments. The de-

fendants also claim error in the judge’s award of treble dam-

ages, costs, and attorneys’ fees, pursuant to c. 15, § 9 (a), to

those members of the plaintiff class who had paid the unlawful

increase. The plaintiff class, as cross appellants, appeal from

that aspect of the judgment which denied their claim for mul-

tiple damages under G. L. c. 93A, § 9 (1). The plaintiff

Scofield appeals from the denial of her individual claims for

damages resulting from the defendants’ refusal to allow her to

remain as a tenant at will following the expiration of her lease.

See G. L. c. 186, § 18. The appeals were transferred here on

our own motion. We affirm the judgment as to the class action,

and reverse as to the individual Scofield claim. '

‘The plaintiff class and Scofield, individually, seek authorization from

us to apply to the trial court for additional attomeys’ fees in connection

with the appeals in this matter. Since we affirm the judge's rulings under

c. 15, we will allow the plaintiffs to so apply for additional fees. See

Linthicum v. Archambault, 379 Mass. 381, 388-389 (1979).

eg

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1. Prior Proceedings.

Scofield instituted this class action in May, 1977, seeking

injunctive and declaratory relief, as well as monetary damages.‘

In June, 1977, the Housing Court judge certified the class’ and

enjoincd the defendants from demanding, collecting, or pursu-

ing any legal remedies against the plaintiffs to collect an in-

crease in their rent. Subsequently, the judge found the defend-

ants Berman & Sons, Inc. (Berman & Sons), and William J.

Allen in contempt of court for violating the injunction.

In January, 1979, following extensive discovery, the plain-

tiffs moved for partial summary judgment on their class claims.

See Mass. R. Civ. P. 56 (a), 365 Mass. 824 (1974). Following

hearings on the motion, the judge granted summary judgment

and damages to the plaintiff class.° A trial on Scofield’s indi-

vidual claims then was held before the judge. In November,

1981, the judge denied Scofield’s individual ciaims and ordered

the entry of final judgment in accordance with his earlier rulings

on the summary judgment motion. At the parties’ request, the

‘The first complaint alleged only a violation of c. 15 and § 12 of the

rent board's regulation. The first amended complaint included a claim by

the class for damages under G. L. c. 93A, based on the defendants’ unlawful

rent increase. Scofield also sought individual relief against the defendants,

based on their alleged unlawful “reprisals” against her by refusing to allow

her to occupy her apartment as a tenant at will. The amended complaint

also added William J. Allen, the landlord's property manager, as a party

defendant.

The plaintiffs filed a second amended complaint, which added Martin S.

Berman and Lila Gross as party defendants. Berman and Gross are general

partners of Berman Central Realty, a Massachusetts limited partnership

which owned the buildings managed by Berman & Sons, Inc., and wherein

the plaintiffs rented their apartments.

* The class, as certified, consisted of “{A]ll persons who have been residing

as tenants under a wnitten lease with the defendant since November 24,

1976 at [properties owned by the defendants} Boston, Massachusetts, whose

premises are subject to Rent Control, and whose tenancies ure governed by

a form of apartment lease utilizing a clause with language identical or

substantially the same as that contained in Paragraph no. 33 of the lease

executed by the named plaintiffs.”

*The judge subsequently allowed Scofield’s motion to supplement her

individual claim for damages under G. L. c. 186, § 18. with a claim under

G. L. c. 93A. A third amended complaint subsequently was filed.

i,

id

judge made supplemental findings of fact and entered an

amended judgment from which both parties appealed.

2. Class Action Claims.

A. Facts. The defendant Berman & Son is the managing

agent of apartment buildings involved in these actions. The

defendant William J. Allen is the property manager for Berman

& Sons. The defendants Martin S. Berman and Lila Gross are

general partners of Berman Central Realty, a Massachusetts

limited partnership and ownex of the properties. The apartments

occupied by the plaintiffs were, at all relevant times, subject

to c. 15 of the ordinances.

In 1975, the plaintiffs Scofield and Berren signed form leases

with the defendants for a term of one year and from year to

year thereafter unless terminated by either party as provided

for by the lease. The form lease contained the following clause

(hereinafter clause 33), which provided: “[I]f during the term

of this lease or any extension or renewal thereof, rent control

laws or laws regulating rents remain in effect or become appli-

cable to the demised premises, and the Lessor is authorized

or permitted to increase the maximum rent for the demised

premises, then the rent to be paid by the lessee hereunder,

commencing with the effective date of such authorization or

permission shall be the maximum rental so authorized or per-

mitted.”

On November 24, 1976, the Boston rent board (Rent Board)

authorized a general rent adjustment for housing subject to rent

control in Boston. Regulation 11, § 12A, of the Rent Board,

promulgated on December 16, 1976, to implement the general

adjustment, provided in relevant part as follows: “Subject to

the provisions of this Regulation the new maximum rent as

established by this regulation may not be charged until the

expiration of any lease or tenancy existing on the effective

date of this Regulation, or unless the tenant is given the option

of terminating the tenancy under a provision of the lease agree-

ment.”

The office manager of Berman & Sons called the Rent Board

to inquire about the forthcoming adjustment. She was advised

that the adjustment would take effect on January |, 1977, and

that only leases containing a “rent control clause” could im-

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mediately implement the increase. Otherwise, a landlord could

not implement the adjustment until the termination of the exist-

ing leases.

The defendants decided that clause 33 of their lease form

was a valid rent control clause, and, accordingly, sent notices

to their tenants in January and February, 1977, advising them

that the authorized rent increase took effect as of January |,

1977.’ Several tenants in the apartments in issue refused to

pay the increase, and the Rent Board advised certain tenants

that the increase was unlawful. Scofield and another tenant

informed Berman & Sons that an employee at the Rent Board

had told them that clause 33 was invalid. A Rent Board com-

pliance investigator also informed Berman & Sons by letter

that their rent control clause was invalid and that, if they had

any questions, they should call him. Subsequently, the defend-

ants commenced small claims actions against at least twenty

tenants who had not paid the increase. The defendants also

sent them notices to quit for nonpayment of rent. Some of the

tenants agreed to pay the increase after being sued."

B. Regulation |]. The judge found that Regulation | 1 was

validly promulgated pursuant to the Rent Board's enabling

legislation, which allowed the board to make regulations effect-

ing general rent adjustments and to condition such adjustments

so as to “remove hardships or to correct other inequities.” Sce

c. 15, §§ 2 (a), 5 (a), 6(b). Moreover, the judge concluded that

. 1 —_- . :

* The adjustment amounted to an 11% increase in the rent charged to the

plaintiffs by Berman & Sons. Scofield was notified that her monthly rent

had been increased from $217 a month to $240 a month.

*In May, 1977, the plaintiffs’ counsel wrote a letter to Berman & Sons

pursuant to the Consumer Protection Act, G. L. c. 93A, § 9 (3), making

demand upon the lessor for unlawfully imposing the increased rent upon

Scofield and the other tenants before the expiration of their leases and

without an opportunity to “opt-out” of their leases. Counsel demanded that

the unlawful adjustment be rescinded and a reasonable ofter of settlement

tendered or he would commence a class action against the defendants under

G. L.c. 93A. William Allen responded by letter to the demand letter stating

that Berman & Sons desired and intended “to correct any incorrectly assessed

rent increases,” although they denied having engaged in fraudulent or decep-

tive practices. No further meetings nor settkement negotiations were held

by the parties.

— ~ d a }

i

}

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Regulation |1 provided an equitable solution to the problem

of tenants who might not be able to afford the 11% increase,

by delaying implementation of the adjustment until the expira-

tion of the lease unless it contained an opt-out provision.

The defendants maintain that the judge erred in concluding

that Regulation 11 was validly promulgated. The defendants

argue that c. 15 enables the Rent Board only to establish a

general adjustment of the maximum rent. It is a well-settled

principle that a regulation is to be judged by the same standard

as a Statute, ordinance, or by-law. See Druzik v. Board of

Health of Haverhill, 324 Mass. 129, 138 (1949). “All rational

presumptions are made in favor of the validity of [the] enact-

ment.” /d. Furthermore, an agency has much flexibility in

interpreting a statute which it is charged with enforcing. Gro-

cery Mfrs. of America, Inc., v. Department of Pub. Health,

379 Mass. 70, 75 (1979). When the agency is vested with

broad authority, as is the Rent Board, to promulgate regulations

which fulfil the purposes of its enabling legislation, such a

regulation is not considered invalid if it relates reasonably to

the objectives of that enabling legislation. See Consolidated

Cigar Corp. v. Department of Pub. Heaith, 372 Mass. 844,

855 (1977). Thorpe v. Housing Auth. of Durham, 393 U.S.

268, 280-281 (1969).

In St. 1969, c. 797, as amended by St. 1970, c. 863, § 1,

the Legislature declared “that a serious public emergency

[exists] in the city of Boston . . . which emergency continues

to be marked by a substantial shortage of rental housing accom-

modations; that, unless residential rents continue to be regulated

and controlled and unless evictions of tenants are regulated

and controlled, such emergency ... will produce serious

threats to the public health, safety and general welfare of the

citizens of [Boston].” The statute further provided that to im-

prove such an emergency shortage of rental housing, the city

may, by ordinance, control the rents of certain housing. See

id. at c. 863, § 2. The ordinance, which was enacted by the

city council as c. 15, provided in § 5 (a) that the Rent Board

“shall, by order or regulation . . . make such individual or

general adjustments . . . of the maximum rent . . . as may

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be necessary to remove hardships or to correct other inequities.”

Chapter 15 further provided that the Rent Board may promul-

gate regulations to establish a general adjustment of maximum

rent “subject to such conditions . . . as the board shall detcr-

mine.” /d. at § 6 (b).

Based on the foregoing provisions we conclude that the

judge correctly held that Regulation |1 relates reasonably to

the objectives of the statute and the ordinance. Cf. McGrath

v. Mishara, 386 Mass. 74, 76, 81-82 (1982). Implicit in the

Rent Board's power to establish a general rent adjustment is

the authority to set certain conditions on when and how rent

increases are to take effect. Cf. Flyna v. Cambridge, 383

Mass. 152, 158 (1981) (grant of express power to municipality

caries with it all unexpressed, incidental powers necessary to

effectuate express authority); 3 C. Sands, Sutherland Statutory

Construction § 64.02 (4th ed. 1974). By requiring that the

adjustment not take effect until the end of the current lease

unless the tenant has the option to terminate the lease agree-

ment, Regulation |! reasonably accommodated the competing

equities of both landlord and tenant.

The judge also denied the defendants® claim that Regulation

11 violated the contract clause of the United States Constitution

by retroactively applying to deprive them of rights under a

contract that was executed before the effective date of the

regulation. See art. 1, § 10, cl. 1, of the United States Constitu-

tion.” The defendants claim this to be error and argue also that

the judge should have decided that a retroactive application of

the regulation would constitute a deprivation of property with-

out due process of law.

By the terms of the defendants’ lease agreement, the lessor

was not entitled to a rent increase unless “authorized or permiut-

ted” to adjust the rent under the “rent control laws... reguliat-

ing rents. . . [in] the demised premises.” This provision clearly

provides that any adjustment would be subject to the Rent

Board's approval. It is anomalous for the defendant now to

“Article 1, § 10, cl. 1, of the United States Constitution provides. in

part: “No state shall... pass any... law impairing the obligation of

contracts.”

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23 SJ os

argue that Regulation |! deprived them of rights under their

lease agreement. In any event, Regulation |! did not deprive

the defendants of their right to receive a rent increase. Under

Regulation | 1, the defendants could have obtained the increase

immediately if their lease had contained the opt-out provision,

otherwise the regulation merely deferred the implementation

of the increase until current leases expired."’ Previously, we

implicitly approved forestalling the immediate implementation

of rent increases, based on a decision by the Boston rent control

administration which used language almost identical to the

wording of Regulation 11. See McGrath v. Mishara, supra at

76, 81, 83.

C. Multiple damages. The judge ruled that, given the ab-

sence of an opt-out provision, clause 33 of the lease did not

satisfy Regulation Il. Thus, he ruled the defendants were

precluded from charging the rent adjustment until the expiration

of the leases. By demanding and, in some cases, receiving the

unlawful increases from the plaintiffs prior to this time, the

defendants violated c. 15 of the ordinance. See c. 15, § 9 (a)."'

The judge found, as matter of law, that, based on the undisputed

facts, the defendants failed to take “practicable precautions”

ugainst the occurrence of a § 9 (a) violation. Thus, the judge

“ The provision in clause 33, which states that the defendants may obtain

a rent increase “commencing [on] the effective date of the [Rent Board's]

authorization,” seems to us in no way inconsistent with the provision of

Regulation Il, § 12A, which specifies the time and circumstances under

which a rent increase may be authorized.

' Section 9 (a) of c. 1S provides: “Section 9. Civil Remedies. (a) Any

person who demands, accepts, receives, of retains any payment of rent in

excess of the maximum lawful rent, in violation of the provisions of this

ordinance, or any rule, regulation, or order hereunder promulgated, shall

be liable. . . to the person from whom such payment is demanded, accepted,

received, or retained, . . . for reasonable attorney's fees and costs as deter-

mined by the court, plus liquidated damages in the amount of one hundred

dollars, of not more than three times the amount by which the payment or

payments demanded, accepted, received, or retained exceed the maximum

rent which could be lawtully demanded, accepted, received, or retained,

whichever is the greater; provided that if the defendant proves that the

violation was neither willful nor the result of failure to take practicable

Precautions against the occurrence of the violation, the amount of such

liquidated damages shall be the amount of the overcharge or overcharges.”

at

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ruled that the defendants were liable to each member of the

plaintiff class who had paid the increase, the greater of $100,

or three times the amount of illegal rent received, plus reason-

able attorneys’ fees.

The defendants contend that the judge erred in granting the

plaintiffs’ motion for partial summary judgment pursuant to

c. 15, § 9 (a). Under § 9 (a), the defendants argue, a material

issue of fact existed concerning whether the defendants acted

wilfully or failed to take practicable precautions against the

occurrence of a violation of the ordinance."

Summary judgment “shall be rendered forthwith if the plead-

ings, depositions, answers to interrogatories, and admissions

on file, together with the affidavits, if any, show that there ts

no genuine issue as to any material fact and that the moving

party is entitled to a judgment as a matter of law.” Mass. R.

Civ. P. 56 (c), 365 Mass. 824 (1974). Once the moving purty

sustains the burden of proving the absence of a material issue

of fact, the opposing party may not rely on his pleadings or

general denials, but must “set forth specific facts” to show

there is a genuine, triable issue. See Community Nat'l Bank

v. Dawes, 369 Mass. 550, 554 (1976). Mass. R. Civ. P. 56

(e). We draw inferences from the facts contained in the mate-

rials which accompany a motion for summary judyment in the

light most favorable to the party opposing the motion. How-

ever, neither “vague allegations and conclusory statements,

nor assertions of inferences not based on underlying facts will

suffice” to sustain the claims in favor of, or against, granting

the motion. See First Nat'l Bank v. Slade, 379 Mass. 24%.

246 (1979).

Multiple damages and attorneys’ fees and costs can be

awarded underc. 15, § 9 (a), if the defendants fail to show that

'? We need not deal with the defendants’ cham thatthe summary pudgy ot

should not have been entered under G. L. 6. YA, 8 9. since there ©

evidence of the defendants” good faith attempts to settle the clispute and |

the plaintiffs’ refusal to accept the overcharges as a settiioment Phe sum,

judgment order of the judge in so tar as i awarded damaves under G

c. 93A was superseded by his subsequent. amended judgment relieving t

defendants from paying duplicative damages under both Gb G9 e Vande to

ofd~e

their violation of the ordinance was “neither wiilful nor the

result of failure to take practicable precautions against the

occurrence of the violation” (emphasis supplied). A violation

of the ordinance occurs when a landlord “demands, accepts,

receives, Of retains . . . rent in excess of the maximum lawful

rent” (emphasis supplied). /d.

The essential factual allegations presented by the plaintiffs’

complaints, affidavits, and other materials supporting their mo-

tion were not refuted. The record shows that the defendants

were placed on notice that their rent control clause was invalid.

However, they refused to investigate the correctness of this

claim. The defendants not only refused to do anything at this

juncture to determine the legality of their increase; they engaged

in further violations of c. 15 by continuing to demand that

they receive the increase, and by retaining the overcharges

already received. Thus, even if we assume that the defendants’

averments siiowed the existence of a triable, factual issue con-

cerning their faiiure to take practicable precautions in initiaily

implementing the reni increase, the defendants have not dem-

onstrated an issue of material fact with respect to their continu-

ing violations of c. 15 by demanding, receiving, and retaining

the unlawful increases after being placed on notice that this

conduct was illegal.

We construe “practicable precautions” to mean those precau-

tions which a reasonable person in the defendaris’ position

would take to guard against violating c. 15. A genuine factual

issue must be demonstrated by “sufficient evidence supporting

the ciaimed factual dispute . . . to require a jury or judge to

resolve the parties’ differing versions of the truth at trial.”

First Nat'l Bank v. Cities Serv. Co., 391 U.S. 252, 288-289

(1968). Accord, Hahn v. Sargent, 523 F.2d 461, 464 (Ist Cir.

1975), cert. denied, 425 U.S. 904 (1976). No such evidence

was presented here. We thus conclude that the judge acted

correctly in granting the plaintiffs’ motion for partial summary

judgment. Cf. Nunez v. Superior Oil Co., 572 F.2d 1119,

1124 (Sth Cir. 1978) (judge warranted in deciding on summary

judginent motion that party acted reasonably or unreasonably,

even if conclusion involves mixed question of fact and law);

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Hahn v. Sargent, supra at 468 (party against whom summary

judgment sought not entitled to trial merely because state of

mind is essential element in cause of action; party must still

show ability to produce evidence sufficient to reach jury on

his claim). Compare Noyes v. Quincy Mut. Fire Ins. Co., 7

Mass. App. Ct. 723, 726-727 (1979) (summary judgment

should not have entered where undisputed facts showed triable

issue concerning defendants’ knowledge or wilfulness in vio-

lating G. L. c. 93A). |

D. Prejudgment interest. The plaintiffs contend that the

defendants’ retention of the rent overcharge entitled them to a

separate award of prejudgment interest under G. L. c. 93A,

§ 9." The plaintiffs claim that the retained unlawful rents con-

stituted a violation of both Regulation 11 and G. L. c. 93A,

§ 2 (c),'* and the continued deprivation of this money warrants

compensation in the form of prejudgment interest. The plain-

tiffs propose that we imply, inG. L. c. 93A, § 9, the authority

of courts to award prejudgment interest as part of the damages

in a consumer's claim so as to facilitate the statute's objective

of promoting reasonable settlements between the parties. See

International Fidelity Ins. Co. v. Wilson, 387 Mass. 841, 857

“General Laws c. 93A, § 9(1), prior to 1979 (as amended through St

1971, c. 241), provided in pertinent part: “Any person who purchases or

leases goods, services of property, real or personal primarily tor personal,

family or household purposes and thereby suffers any loss of money of

property, real or personal, as a result of the use or employment by another

person of an unfair or deceptive act or practice declared unlawtul by section

two or by any rule or regulation issued under paragraph (¢) of said section

two may... bring an action in the superior court in equity tor damages

Only the members of the plaintiff class who were awarded damages for

their payment of the unlawtul rent are secking additional damages on this

appeal. The plaintiifs asserted a claim tor interest on the amount ot the

unlawful rent overcharge under G. L.c. Y3A, $8 9, in their second and third

amended complaints.

On the plaintiffs’ claim that the defendants violated G. Log. 3A. § 2

(co), by their violation of Regulation U1, the judge awarded summiary juidg-

ment to the plaintiffs.

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(1983).'* The difficulty with this argument is that, while the

plaintiffs sought cumulative damages under c. |5 and G. L.

c. 93A, they did not raise specifically the claim of prejudgment

interest before the judge. This issue is not properly before us,

as it is raised for the first time on appeal. See Jones v. Wayland,

374 Mass. 249, 252-253 n.3 (1978). Assuming, however, that

damages under G. L. c. 93A, § 9, can be computed as “interest”

for loss of the use of money wrongfully detained, see Guenard

v. Burke, 387 Mass. 802, 809 (1982), the question remains

whether such damages should be cumulatively awarded.'°

The judge, in his amended order, took cognizance of the

McGrath v. Mishara, 386 Mass. 74 (1982), and Wolfberg v.

Hunter, 385 Mass. 390 (1982), decisions and, in order to avoid

cumulative damage recovery, allowed recovery only under

c. 15. The amended order thus superseded his earlier order

granting multiple damages to the plaintiffs pursuant to G. L.

c. 93A, § 9 (1). On the basis of the Mishura and Wolfberg

decisions, we conclude that separate damages may not be re-

covered under both c. 15 for the defendants’ unlawful demand

for rent and G. L. c. 93A, based on the defendants’ unlawful

retention of the amounts collected. The illegal acts involve the

defendants’ conduct in demanding and, in some cases, receiv-

ing the unauthorized rent increase, in violation of both the

ordinance and G. L. c. 93A. Thus, where the plaintiffs have

sustained their claim to recover multiple damages, under c. 15,

“The plaintiffs rely on a provision of the Clayton Antitrust Act as an

analogous statute to § 9, which provides that a plaintiff who has been injured

by a violation of the antitrust laws may move to recover simple interest on

the actual damages awarded on this claim. See 15 U.S.C. § 15 (1976 &

Supp. 1981), as amended by 1980 Pub. L. 96-349, § 4 (a) (1), 94 Stat.

1156. We decided, however, that the Legislature consciously chose not to

follow § 15 of the Clayton Act in enacting § 9. See International Fidelity

Ins. Co. v. Wilson, supra at 855.

‘The plaintiffs who paid the rent overcharge to the defendants were

denied the use of the legal increase which, the judge concluded. was

demanded and received tn violation of G. Lc. 883A, 8 9 (ce). The plainutts’

loss of the use of this amount of money resulted from this violation of the

Consumer Protection Act, Guenard, supra at 809-810, and the defendant's

refusal, on demand, to tender the amount of the overcharge due the phaintitts

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sSB EBESESE RRB SERB BREESE

they are precluded from duplicate recovery based on claims

alleging the same wrongful conduct under G. L. c. 93A. See

Mishara, supra at 85. Although the plaintiffs may recover

under whichever statute offers them the greater amount of

damages for the defendants’ same wrongful conduct, see Mis-

hara, supra at 84, there is no showing on this record that, if

damages were set under c. 93A, they would have received a

larger award. There was no error.

3. Scofield’s Individual Action.

A. Facts. Berman & Sons notified Scofield by letter dated

June 27, 1977, that her current lease was to terminate August

31, 1977, in conformance with its terms. The letter further

stated that Scofield could extend her tenancy for an additional

year under the lease addendum which incorporated the rent

increase approved by the Boston Rent Board. Because Scofield

thought that she could not afford to pay the rent and decided

to find subsidized housing, she chose not to sign the addendum.

Instead, she requested permission to remain as a tenant at will

and pay the new rent until she could find cheaper housing. At

that time, Scofield could not provide Berman & Sons with an

estimated date by which she could vacate her apartment. Ac-

cording to the procedure at Berman & Sons, a committee

comprised of Martin Berman, Donna McCormack, William

Allen, and another employee reviewed the tenant's request to

become a tenant at will. The committee denied Scoticld’s

request by means of a letter to her attorney, authored by Allen

and dated July 14, 1977. In the letter Allen stated that he

believed that the Housing Court's order allowed him only to

offer the new one-year lease at maximum rent, and that he

expected Scofield either to sign the lease addendum or to notity

him that she would vacate. the apartment.'’

B. Damages pursuant to G. L. c. 938A, § 9. In November,

1981, the judge issued his order on Scofield’s individual claims

under G. L. c. 186, § 18, and G. L. c. 93A, following a one-

day trial on these issues. The judge ruled that Scotield could

Scotield’s counsel responded, by letter, that his cheat was offering to

pay the new maximum rent under a tenancy at will

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not recover damages under G. L. c. 93A, since the statute, as

it read prior to the 1979 amendment, required the consumer

to show a loss of tangible real or personal property resulting

from the unfair or deceptive act or practice. See Baldassari v.

Public Fin. Trust, 369 Mass. 33, 44-45 (1975). The judge

found that Scofield had suffered no damages under G. L.

c. 93A as a result of the defendants’ refusal to allow her to

remain as a tenant at will."

Scofield does not dispute the correctness of the judge's ruling

that she suffered no monetary damages under G. L. c. 93A.

Instead, she claims that the defendants’ failure to satisfy her

rightful claim under G. L. c. 186, § 18, once a formal written

demand had been made, amounted to a loss of money or prop-

erty under G. L. c. 93A. Scofield cites no case law to support

this contention. Since her claim is based on G. L. c. 93A,

§ 9, prior to its 1979 amendment, we conclude that her claim

is untenable because it does not allege an actual loss or depri-

vation of money or other property. See Baldassari, supra at45.

C. The “reprisal” claim. On Scofield’s claim under G. L.

c. 186, § 18, the judge found that Scofield had proved by a

preponderance of the credible evidence that one of the defend-

ants’ principal motives in refusing her request to remain as a

tenant at will in July, 1977, was her report of the defendants’

unlawful conduct to the Rent Board in 1977." In his later order

for supplemental findings and entry of un amended judgment,

the judge adopted other specific findings of fact, requested by

Scofield, relevant to the defendants’ “motive.” There was no

evidence that uny tenant, other than Scofield, had been denied

u request to occupy as a tenant at will. The judge found that

“Scotield vacated her apartmeat upon the expiration of her lease. She

did not pay the increased rental charge. Indeed, she realized a significant

savings in her housing cost at her new subsidized premises.

"The judge correctly applied the version of G. Lc. 186. 8 16, prior te

its 1978 amendment, The judge noted that Scotield’s factual scenario did

not involve any of the circumstances in the statute which gave tise to a

presumption of retaliation. See G. LL. ¢. 186. § TS (receipt of notice of

termination, substantial increase in rent, of substantial alteration in terms

of tenancy within six months of tenant's complaint creates rebuttable pre

sumption that notice is reprisal against tenant)

-Al4-

there were seventeen other tenants of the defendants who had

been granted tenancies at will and who were living under such

agreements between September and December, 1977, and there

was no record why thirteen of these tenants were granted tenant-

at-will status. By April, 1978, several of these tenants had

occupied as tenants at will for time periods ranging from nine

to fifty months.” Certain other members of the plaintiff class

were given tenant-at-will status by the defendants in August,

1977, and by May, 1978, the defendants had adopted a policy

of requiring all their tenants to utilize at-will agreements.

The judge, however, concluded that the defendants’ refusal

to accord Scofield tenancy-at-will status was not a “reprisal”

within the meaning of G. L. c. 186, § 18. The judge noted

that the statute does not define “reprisal” except to provide

that certain action, such as a substantial alteration in the terms

of the tenancy or a termination of the tenancy within six months

after the exercise of a tenant’s legal rights, raises a rebuttable

presumption that such action is a reprisal. The judge found

unpersuasive Scofield’s claim that Berman & Sons’ refusal to

allow her to remain as a tenant at will amounted to a violation

of the statute where the defendant had no legal obligation to

extend this benefit to her. The judge noted that it was Scotield

who refused the defendants’ offer to renew her lease. Scofield

had no right to expect the defendants to accede to her request

for a substantial alteration in the terms of her tenancy. Thus.

the judge concluded that the defendants’ conduct did not con-

stitute a reprisal against Scofield for her legally protected ac-

tions underG. L.c. 186, § 18, and therefore entered judgment

in favor of the defendants on all Scofield’s individual claims.

Scofield claims that G. L. c. 186, § 18, should be construed

to prohibit a landlord’s refusal, based on a tenant's exercise

of protected rights, to extend to that tenant a benefit that reg-

ularly has been accorded other tenants. The defendants contend

that Berman & Sons’ refusal to allow Scofield to remain as a

“The judge found Scofield’s reason for wanting at-will tenancy was the

type of reason which, under normal circumstances, would have resulted in

the landlord's acceding to the tenant's request.

-Al5-

a wae

hailed

tenant at will was not a “reprisal” within the meaning of G. L.

c. 186, § 18. The defendants correctly point out that no Mas-

sachusetts case has ever held, or implied, that a landlord’s

refusal to grant a tenant’s request to occupy as a tenant at will

constitutes a reprisal. But cf. 940 Code Mass. Regs. § 3.17

(6) (b) (1981) (unfair or deceptive practice under G. L. c. 93A

for property owner to “retaliate in any manner against a tenant

_ forexercising . . . any legal rights as set forth inc. 186, § 18”).

We begin our construction of G. L. c. 186, § 18, with the

words of the statute, which must be given “their usual and

ordinary meaning considered in light of the aim to be ac-

complished by the Legislature.” See Prudential Ins. Co. v.

Boston, 369 Mass. 542, 546 (1976). General Laws c. 186,

§ 18, prior to its 1978 amendment, provided in pertinent part:

“Any person . . . who threatens to or takes reprisals against

any tenant of residential premises for reporting to .. . any

. . . board having as its objective the regulation of residential

premises a violation or a suspected violation of any health or

building code or of any other municipal by-law or ordinance

or state. . . law . . . which has as its objective the regulation

of residential premises. . . shall be liable fordamages. . . .”

The legislative history of the statute demonstrates that the

Legislature intended the law to apply to a broad range of factual

situations wherein tenants are retaliated against for seeking to

enforce protected rights under our housing laws. See 1969

Senate Doc. No. 1327. Although proposed drafts of the statute

limited its coverage to tenants who reported sanitary or building

code violations, see 1969 Senate Doc. No. 1139, § 127K,

1969 House Doc. No. 2926, the law, as enacted, applied to

tenants who complained of violations of any “municipal ordi-

nance or state law” which has “as its objective the regulation

of residential premises.” G. L. c. 186, § 18. Clearly the ordi-

nance involves the regulation of residential premises. The

Legislature subsequently broadened the statute's coverage to

include tenants who participated in a tenants’ union, or similar

organization, or who reported a violation of Federal law regulat-

ing residential premises. See St. 1972, c. 99, § 1. In 1973,

the statute was amended again to apply to tenants who exercised

-Al6-

se BSS SeSeeeeaew SS =

‘=

—_

q

their rights to be reimbursed for paying their landlord’s gas or

electric bills. See St. 1973, c. 858, § 3 (inserting reference to

G. L. c. 164, § 124D).?' The Legislature’s usage of broad

language in the initial statute and its amended versions to

describe activities protected against reprisal by a landlord, and

its expansion of these protected activities in subsequent amend-

ments, lead us to conclude that G. L. c. 186, § 18, protects

a tenant who was retaliated against by a landlord for reporting

violations of the rent controi ordinances.

General Laws c. 186, § 18, prohibits a threatened or actual

“reprisal” against a tenant for engaging in a protected activity.

The ordinary meaning of a “reprisal” is “a retaliatory act.”

Webster’s Ninth New Collegiate Dictionary at 1,000 (1983).

We construe G. L. c. 186, § 18, to utilize this broad definition

tailored, however, to achieve the statutory objective of protect-

ing those tenants who have been retaliated against by landlords

due to their exercise of legal rights under the housing laws.

Cf. Prudential Ins. Co., supra at 547 (courts must construe

statute as written and a contingency for which no provision

made does not warrant judicial legislation). We think that if

the Legislature had intended “reprisal” to have a narrow mean-

ing, it would have specified those acts which would constitute

a reprisal, and it would not have provided, in a separate para-

graph that “(t]he receipt of any notice of termination of tenancy

. . or, of any substantial alteration in the terms of the tenancy

within six months after the tenant has commenced, proceeded

with, or obtained relief in such action . . . [or] made such

report or complaint (relating to the building in which the tenant

resides] shall create a rebuttable presumption that such notice

. iS a reprisal against the tenant for [making such report or

complaint]. G. L. c. 186, § 18, as appearing in St. 1978,

c. 149, § 1. By its terms, the statute extends to “reprisals”

*' The statute again was amended in 1978, extending coverage to tenants

who were retaliated against, based on their commencement of actions or

attainment of relief in actions to enforce laws which regulate residential

premises. See St. 1978, c. 149, § |.

-Al7-

other than those acts which give rise to the rebuttable presump-

tion described in the latter paragraph.” Cf. G. L. c. 239, §2A.

It is indisputable that a lessor has no legai duty to permit a

tenant to occupy the demised premises following the termina-

tion of her lease or tenancy, and may bring an action for

summary process against the tenant who wrongfully holds over

in the premises. See Gunsenhiser v. Binder, 206 Mass. 434,

437 (1910); G. L. c. 239, § 1. There is, however, considerable

persuasive authority, from courts of other jurisdictions, which

indicates that a lessor lawfully may not terminate a tenancy

when that action is taken in retaliation for the tenant’s reporting

violations of the housing laws.

In support of the principle that landlords may not seek to

evict tenants for reporting violations of housing laws is the

landmark case of Edwards v. Habib, 397 F.2d 687 (D.C. Cir.

1968), cert. denied, 393 U.S. 1016 (1969). The landlord in

Edwards gave the tenant proper statutory notice to vacate her

apartment soon after she reported sanitary code violations, and

he obtained a judgment for possession of the premises. /d. at

688-689. Judge J. Skelly Wright noted that, under the District

of Columbia housing code, a landlord has the right to evict a

tenant with or without cause. /d. at 688. The need effectively

to implement and enforce remedial legislation such as the hous-

ing and sanitary codes, however, impliedly prohibited landlords

from evicting tenants from month to month in retaliation for

their reporting code violations. /d. at 699-700. “The notion

that the effectiveness of [such] legislation will be inhibited if

those reporting violations of it can legally be intimidated is so

fundamental that a presumption against the legality of such

intimidation can be inferred as inherent in the legislation even

* Several State statutes have specifically delimited the proscribed types

of retaliatory action which a landlord could not engage in to penalize a

tenant for exercising protected rights. See, e.g., Ariz. Rev. Stat. Ann.

§ 33-1381 (1974) (increasing rent, decreasing services, or bringing or

threatening to bring action for possession); Cal. Civ. Code § 1942.Sic)

(West Supp. 1984) (increase rent, decrease services to which tenant entitled,

or cause tenant to quit premises involuntarily); NJ. Stat. Ann. § 2A.42-

10.10 (West Supp. 1983) (serving notice to quit or instituting any action

against tenant for possession of premises).

~Al18-

if it is not expressed in the statute itself.” /d. at 701-702. In

reversing the judgment for the landlord and remanding the

case, the judge concluded that the tenant must prove the factual

issue whether the landlord had an impermissible retaliatory

purpose in evicting the tenant. Several jurisdictions have fol-

lowed the Edwards policy of encouraging tenants to report

violations of the housing laws by interpreting their retaliatory

action statutes or other housing laws to prohibit landiords from

seeking to dispossess tenants for exercising these legal rights.

See, e.g., Schweiger v. Superior Court of Alameda County,

3 Cal. 3d 507, 517 (1970); Clore v. Fredman, 59 Ill. 2d 20,

27-28 (1974); Parkin v. Fitzgerald, 307 Minn. 423, 428-429

(1976); Delmat Corp. v. Kahn, 147 N.J. Super. 293, 299-300

(1977); Dickhut v. Norton, 45 Wis. 2d 389, 399 (1970). Cf.

Silberg v. Lipscomb, 117 N.J. Super. 491, 496 (1971) (under

N.J. Stat. Ann. § 2A:42-10.10 (West Supp. 1983]). Barela

v. Superior Court of Orange County, 30 Cal. 3d 244, 249

(1981). The salutary policy of the Edwards decision is appli-

cable to the present case. Effective enforcement of the rent

control laws is promoted when tenants are not inhibited in

reporting suspected or actual violations of these laws by a tear

of reprisal by landlords. We think that the Legislature may

have anticipated that tenants would be deterred from disclosing

landlords’ infractions of the housing laws due to a landlord's

largely unrestricted power to terminate tenancies at will. The

enactment of G. L. c. 239, § 2A, also reflects a desire to

protect tenants who report such violations under G. L. c. 186,

§ 18, from retaliatory terminations of their at-will tenancies.*'

“General Laws c. 239, § 2A, as appearing in St. 1978. ¢. 149, § 2.

provides, in relevant part: “It shall be a defense to an action for summary

process that such action or the preceding action of terminating the tenant's

tenancy, was taken against the tenant for the tenant's act of commencing,

proceeding with, or obtaining relief in any judicial of administrative action

the purpose of which action was to obtain damages under or otherwise

enforce, any federal. state or local law, regulation, by-law, of ordinance,

which has as its objective the regulation of residential premises, or exercising

rights pursuant to section one hundred and twenty-four D ot chapter one

hundred and sixty-four, or reporting a violation of suspected violation of

law as provided in section eighteen of chapter one hundred and eighty-six.

of organizing or joining a tenants union of simular organization.”

-A19-

FE El EE a Oe i i a SE UD lL... ee

The efficacious implementation of rent control laws will not

support a decision which would require a landlord to allow

lessees to become tenants at will after the expiration of their

lease. A landlord has the unfettered right to dictate the type

of tenancy under which a tenant may occupy the premises,

and lawfully may refuse to let any tenant rent on an at-will

basis. However, when a landlord has an established policy of

allowing lessees to remain as tenants-at-will following the ter-

mination of their leases, the landlord cannot lawfully refuse

to apply that policy to a tenant because that tenant has reported

the landlord's violations of the rent control laws. Cf. Golphin

v. Park Monroe Assocs., 353 A.2d 314, 315, 317-318 (D.C.

1976). In Golphin, the Court of Appeals decided that a tenant

who was denied an at-will tenancy following the expiration of

his lease, in contravention to the landlord's established policy,

could defend against a possession action by showing that the

landlord’s refusal was in retaliation for his tenant-organizing

activities. /d.**

We conclude, based on the f-ndings of the judge, that the

defendants’ refusal to allow Scofield to remain as a tenant at

will following the expiration of her lease constituted a “reprisal”

under G. L. c. 186, § 18, for her reporting the landlord's

unlawful rent increase to the Rent Board. A landlord who

refuses to apply an established policy of permitting at-will

tenancies to a tenant because of her efforts to enforce the laws

violates the legislative intent that there be good faith and fair

dealing between landlords and their tenants. The judge con-

cluded that Scofield had proved, by a preponderance of the

“Similar to G. L. c. 186, § 18, Housing Regulations of the District of

Columbia, Retaliatory Acts § 2910 (1982), is worded broadly: “No action

or proceeding to recover possession of a habitation may be brought against

a tenant, nor shall an owner otherwise cause a tenant to quit a habitation

involuntarily, ‘nor demand an increase in rent from the tenant, nor decrease

the services to which the tenant has been entitled. nor increase the obligations

of a tenant,” in retaliation against a tenant's: (a) Good faith complaint or

report concerning housing deficiencies made to the owner or a governmental

authority, directly by the fenant of through a tenant organization. (b) °

faith organization of of membership in a tenant organization. («>

assertion of rights under these Regulations.” (Emphasis su

-A20-

credible evidence, that “one of Berman’s principal motives”

for refusing Scofield’s request was her reporting the unlawful

increase to the Rent Board. Cf. Robinson v. Diamond Hous.

Corp., 463 F.2d 853, 865 (D.C. Cir. 1972) (in possession

action, fact finder may find for landlord who presents evidence

that legitimate business reasons principally motivated decision

to evict tenant). Accordingly, Scofield is entitled to recover

from the defendants, jointly and severally,” for their violation

of G. L. c. 186, § 18, an amount equal to not less than one

month’s rent nor more than three months’ rent, and reasonable

attorneys’ fees and costs of the suit.”

4. Conclusion.

We remand this case to the judge of the Housing Court to

enter an appropriate order on Scofield’s claim under G. L.

c. 186, § 18, consistent with the principles expressed in this

opinion. The judgment as to the class claim is affirmed.

So ordered.

Lyncu, J. (dissenting). I dissent only from that part of the

opinion that concludes that the defendant landlord's refusal to

*On the G. L. c. 186, § 18, claim, Scofield sought joint and several

liability against Berman & Sons, Inc., William J. Allen, Martin S. Berman,

and Lila Gross. The statute provides for joint and several liability by sub-

jecting to payment of damages “any person or agent thereof. . . who takes

reprisals” against a tenant of residential property.

We dismiss summarily Scofield’s argument that G. L. c. 186. $ 18. is

a statute which exacts a penalty from wrongdoers with reterence to the

degree of their culpability, thereby entitling the plaintiff to recover damages

from both Berman and Allen. In contrast to other statutes which specifically

provide that the degree of a defendant's personal fault shall enter into the

assessment of damages for which he is liable, G. L. c. 186, § 18. provides

only that liability shall be no less than one month's rent nor more than three

months’ rent, or the amount of actual damages, whichever is greater. Cf.

International Fidelity Ins. Co. v. Wilson, 387 Mass. 841, 856 (1983) (in-

dependent liability of defendants upheld under multiple damages provisions

of G. L. c. 93A which assess individual fault of each wrongdoer).

** As Scofield admits, she suffered no actual damages as a result of the

unlawful reprisal and her damages thus are limited to an amount no less

than one month's rent and no greater than three months’ rent. G. L. c. 186. 9 18

~A21-

SEEBRER EES EERRZES

allow Scofield to remain as a tenant at will following the

expiration of her lease constitutes a reprisal underG. L.c. 186,

§ 18, for her reporting the landlord’s unlawful rent increase

to the Rent Board. Ante at 114. The majority correctly point

out that the landlord had no obligation to extend to Scofield

tenant-at-will status at the expiration of her lease. Although

the landlord refused Scofield’s request for tenant-at-will status,

she could have remained on the premises as a tenant at suffer-

ance, Jorio v. Donnelly, 343 Mass. 772 (1961). Without

delving at length into the law of tenancies at sufferance under

modern legislation (see King v. G & M Realty Corp., 373

Mass. 658, 663-664 [1977]), I conclude that this change of

status was not significant enough to constitute a “reprisal” by

the landlord. It is clear that as a tenant at sufferance she could

have remained on the premises until the landlord took action

to regain possession, King v. G & M Realty Corp., supra, and

during the period of her occupancy she remained obligated to

pay rent. G. L. c. 186, § 3. I conclude that no reprisal existed

in such a situation, at least until the landlord issued a notice

to quit or took some other affirmative step to regain possession.

All of the decisions cited in the majority opinion concerning

other jurisdictions deal with evictions, and typically these de-

cisions find retaliatory action to be a defense to proceedings

instituted by the landlord to regain possession. The present

case differs from those eviction cases in that the defendant

landlord here took no affirmative action to dispossess the plain-

tiff of the apartment. For example, in Golphin v. Park Monroe

Assocs., 353 A.2d 314 (D.C. 1976), the tenant, denied at-will

status at the expiration of a lease, remained in the apartment

and successfully defended an eviction proceeding. The court

based its decision explicitly on the improper use of judicial

process that occurs when a landlord brings eviction proceedings

for retaliatory reasons. /d. at 317-318. | view this line of

decisions from other jurisdictions as an indication of judicial

reluctance to see the courts used as an instrumentality by lund-

lords seeking illegal retaliation.

-A22-

COMMONWEALTH OF MASSACHUSETTS.

SUFFOLK, Ss: HOUSING COURT DEPARTMENT

CITY OF BOSTON DIVISION

CIVIL ACTION

NO. 06165

LANA J. SCOFIELD, A. LARRY BERRIN, on

behalf of themselves and on behalf of all

those similarly situated and-the BOSTON

RENT BOARD

vs

BERMAN & SONS, INC., WILLIAM J. ALLEN,

MARTIN S. BERMAN and LILA GROSS

FINDINGS OF FACT, CONCLUSIONS OF LAW AND

ORDER RELATIVE TO PLAINTIFFS' MOTION FOR

PARTIAL SUMMARY JUDGMENT AGAINST

DEFENDANTS BERMAN & SONS, INC., MARTIN S.

—__________ BERMAN and LILA GROSS

The plaintiffs have filed a motion

on behalf of the class they represent for

Partial summary judgment, pursuant to

Mass. R. Civ. P. 56(a), with respect to

the causes of action asserted in

paragraphs 26 and 27 of the Second

Amended Complaint and the plaintiffs'

seek relief in accordance with prayers 2,

-A23-

BEB EER ERE G |

3 and 3.1 of the prayers for relief

contained in the Second Amended

Complaint. After reviewing the

pleadings, the answers to

interrogatories, the admissions and the

affidavits on file, I find that there is

no geniune issue as to any material fact

relating to the claims for which summary

judgment is sought. Based on the

foregoing record, the Court makes the

following findings of fact and

conclusions of law.

(1) This Civil Action was filed on

May 12, 1977, as a class action, by

tenants who sought injunctive relief,

declaratory relief and damages on behalf

of themselves and other persons similarly

Situated from whom illegal rental charges

had.allegedly been demanded and/or

received by the defendants. After

hearing, the Court on June 21, 1977

-A24-

BEERS ESET

issued a preliminary injunction

prohibiting the defendants from

collecting certain rents.

(2) On June 21, 1977 the Court

entered an Order permitting the

plaintiffs to maintain this action as a

class action on behalf of themselves and

on behalf of certain other similarly

Situated individuals. On March 13, 1978

the Court entered an Order expanding the

scope of the class represented by the

plaintiffs. The plaintiffs now represent

the following class of individuals:

All persons who have been

residing as tenants under a

written lease with the

defendants since November 24,

1976 at 1800, 1810, 1820 or 2045

Commonwealth Avenue, 66-70 or 90

Chiswick Road, all in the

Brighton section of Boston,

Massachusetts, whose premises

are subject to Rent Control, and

whose tenancies are governed by

a form of apartment lease

utilizing a clause with language

identical or substantially the

Same as that contained in

paragraph number 33 of the lease

-A25-

executed by the named

plaintiffs.

Approximately twenty-five (25) persons

were excluded from the class at their

request so that the class presently is

comprised of eighty-nine (89) individuals

and the estate of one other person. The

class members occupied some 76 housing

units in December of 1976. Exhibit A of

these findings contains the name of each

member of the class and their address as

of December, 1976.

(3) At all times relevant to this

action, the plaintiff Lana J. Scofield

was a resident of 1800 Commonwealth

Avenue, Apartment 27, in the Brighton

section of Boston, Massachusetts.

(4) At all times relevant to this

action the plaintiff A. Larry Berren was

a resident of 70 Chiswick Road, apartment

number 2 in the Brighton section of

Boston, Massachusetts.

-A26-

(5) The defendant Berman & Sons,

Inc. (hereinafter Berman & Sons) is a

Massachusetts business corporation with a

principal place of business at 52 North

Street, Stoneham, Massachusetts. Said

defendant is the munaging agent for the

owners of the apartment buildings

situated at 1800, 1810, 1820, 2045

Commonwealth Avenue, 66-70 and 90

Chiswick Road, all of which are situated

in the Brighton section of Boston. Said

defendant was the lessor with respect to

the leases signed by the members of the

plaintiff class. Martin S. Berman is the

President of Berman & Sons.

(6) The defendant William J. Allen

(hereinafter Mr. Allen) was at all times

material to this case the defendant

Berman & Sons' property manager. His

office was located at 1800 Commonwealth

Avenue, Brighton, Massachusetts. The

-A27-

instant motion for partial summary

judgment does not involve any of the

claims asserted against Mr. Allen.

(7) Martin S. Berman and Lila

Gross are the general partners of Berman

Central Realty a Massachusetts Limited

Partnership and owner of the premises

located at:

66-70 Chiswick Road, Brighton

90 Chiswick Road, Brighton

1800 Commonwealth Avenue,

Brighton

1810 Commonwealth Avenue,

Brighton

2045 Commonwealth Avenue,

Brighton

Said defendants employ Berman & Sons and

Mr. Allen as, respectively, managing

agent and property manager with respect

to all of the apartment buildings which

are the subject of this action except for

the apartment building situated at 1820

Commonwealth Avenue.

-A28-

BEER ERBREEREE EERE EES

(8) The plaintiff Boston Rent Board

(hereinafter "the Rent Board") is,

empowered, pursuant to Chapter 15 of the

City of Boston Ordinances of 1975, (which

regulates certain residential rents and

evzctions) to establish and adjust the

maximum rent that can be charged for

housing accomodations within the purview

of said Ordinance. The Rent Board's

motion to intervene as a plaintiff was

allowed in June, 1980.

(9) In 1975 both of the named

plaintiffs signed a form lease with the

defendant Berman & Sons. Both leases

were for a term of one year and from year

to year thereafter unless terminated by

either party as provided for by the

lease. Both leases were in effect at all

times material to this case.

(10) The apartment occupied by the

plaintiff class, as defined by this

-A29-

Court's Order of March 13, 1978, were

subject to Boston's rent control

ordinance, Chapter 15 of the Ordinances

of the City of Boston of 1975. On

November 24, 1976 the Rent Board

authorized a general rent adjustment for

housing subject to rent control in the

City of Boston. This general rent

adjustment was authorized for the

properties occupied by memebers of the

plaintiff class on December 16, 1976 when

the Boston Rent Board authorized a

general rent adjustment subject to the

following:

A. Subject to the provision of

this regulation, the new maximum

rent as established by this

regulation may not be charged

until the expiration of the

lease or tenancy existing on the

effective date of this

regulation, or unless the tenant

ac_given the option ot

See er a err nes

agreement. (emphasis supplied)

Regulation ll, Section 12.

-A30-

BEESGESEEREEEEEE SE.

(ll) The form lease executed by

members of the plaintiff class did not

contain a provision providing for the

termination of the tenancy during the

term of the lease. The form lease

executed by members of the plaintiff

class contained the following clause:

33 Rent Control

Notwithstanding anything

herein to the contrary:

(A) Lessee shall pay only

the maximum rent allowed

under applicable rent

control laws or other laws

regulating rents.

(B) If during the term of

this lease or any extension

Or renewal thereof, rent

control laws or laws

regulating rents remain in

effect or become applicable

to the demised premises and

the Lessor is authorized or

permitted to increase the

maximum rent for the

demises premises, then the

rent to be paid by the

lessee hereunder,

commencing with the

effective date of such

authorization or permission

shall be the maximum rental

so authorized or permitted.

-A31-

(12) In January and February, 1977

Berman & Sons sent out notices to members

of the plaintiff class advising said

tenants that the maximum rent authorized

by the December 16, 1976 general rent

adjustment would be effective with

respect to their apartments as of January

1, 1977. The plaintiff Scofield was

notified that her rent had been increased

from $217 a month to $240 per month.

Plaintiff Berren was notified that his

rent had been increased from $205 per

month to $227 per month.

(13) The Rent Board advised

certain of the tenants that the requested

increase was not lawful and some of the

tenants refused to pay the increase.

(14) Berman & Sons knew or should

have known as of February, 1977 that it

was not entitled to implement the

December 16, 1976 general rent adjustment

-A32-

HEEEERER EERE RE EREEEEE

on January 1, 1977 with respect to those

tenants who are members of the plaintiff

class. There is no dispute that Berman &

Sons was notified of the Rent Board's

position on the following three occasions

in January and February, 1977:

ae On or about February ll, 1977

the plaintiff Scofield returned Berman &

Sons' February 8, 1977 notice of rent

increase with a note that she had been

advised by the Rent Board to continue

paying the $217 as provided for in her

lease.

b. On February 16, 1977, a Rent

Board compliance investigator wrote to

Berman & Sons advising said defendant

that it had come to his attention that

the said defendant was trying to enforce

Clause 33 of the lease which was illegal

because it did not permit the tenant the

right either to accept the higher rent or

-A33-

leave. Said letter informed the

defendant Berman & Sons that "if you have

any questions please call me at 722-4630

ext. 127".

c. In addition, another tenant,

Molly Zuckernik, who lived in apartment

28 at 1820 Commonwealth Avenue, advised

defendant Berman & Sons by letter dated

January 21, 1977 that she had spoken to

Mr. Charles O'Hearn at the Rent Board on

January 18, 1977 in connection with

Berman & Sons January 13, 1977 notice of

rent increase and that she was advised by

Mr. O'Hearn that clause 33 of the lease

is invalid and that she was not obligated

to pay the requested increase until her

lease terminated on March l, 1977.

(15) As of December 1976 all

members of the plaintiff class, pursuant

to the terms of their leases, were being

charged the maximum rent authorized by

-A34-

SEES RERERERERER ES

the Rent Board. A number of the

plaintiff class members refused to pay

the rent increase demanded by Berman &

Sons effective January 1, 1977. Asa

result, Berman & Sons commenced small

claims actions against at least twenty

(20) tenants. In addition, said

defendant sent notices to quit for

non-payment of rent to certain members of

the plaintiff class as a result of their

refusal to pay the increase. Some of the

tenants agreed to pay the rent increase

under protest after being sued, including

plaintiff Berren.

(16) On June 21, 1977 the Court

issued a preliminary injunction against

the defendants prohibiting them from

pursuing any legal remedies against class

members for the collection of the general

rent adjustment authorized by the Rent

Board on December 16, 1976, from

-A35-

T@QeeeeBeBeeeaBeaertasgas:

terminating the tenancy or seeking

possession of the premises occupied by

class members solely on the grounds of

non-payment of the said general

adjustment, from demanding, assessing, Or

collecting from any member of the class

the said general adjustment unless a new

lease executed by the tenant authorized

receipt of said payment or unless the

tenant agreed in writing to pay the

demanded rent. The June 21, 1977

injunction did not afford any protection

to tenants residing at 90 Chiswick Road

or 1820 Commonwealth Avenue who were not

included within the plaintiff class until

March 13, 1978.

(17) On May 1, 1978, after

hearing, the Court found defendants Allen

and Berman & Sons in contempt of this

Court's June 21, 1977 injunction because

they continued to collect, after June 21,

-A36-

HERES ERREREREREEE

1977, the December 16, 1976 general

adjustment. Pursuant to this Court's

Order of May 1, 1978, the defendants

refunded certain rent overcharges

received by the defendants in violation

of this Court's June 21, 1977 Order.

(See Defendants' Report of Complaince

with the Order of Compliance of the Court

dated May 1, 1978).

(18) The defendants Martin Berman

and Lila Gross as the owners of the

property in question (except 1820

Commonwealth Avenue) and as principals

for whom the defendant Berman & Sons is

employed are liable for the conduct of

Berman & Sons. This, in substance, is

the allegation made in paragraph 5.2 of

the Second Amended Complaint which was

neither admitted nor denied by the

defendants' Answer and is, therefore,

deemed admitted. Mass. R. Civ. P. 8(d).

-A37-

BEERS ERSRERRERE EEE

Defendants Berman and Gross, as general

partners of a limited partnership, would,

under Massachusetts law, be liable

jointly and severally for the actions of

their agents describe in these findings.

G.L. c. 108A §15 and G.L. c. 109 §9. See

also Section l(g) of Chapter 15 of the

Ordinances ofg1975 which provides that

"the rights and duties o.1 the landlord

shall be the obligation of anyone who

manages . . . on behalf of the landlord".

VIOLATION OF SECTION 12 OF

REGULATION 1] OF THE RENT BOARD

(19) Paragraph 26 of the Second

Amended Complaint alllegs [sic] that the

defendants imposed and sought to impose

rent increases on the plaintiff class in

violation of Chapter 15 of the Ordinances

of 1975 and the regulations of the Rent

Board promulgated pursuant to said

Ordinance. Secton 9(a) of Chapter 15 of

-A38-

rReeReeRERER EE EE FE Ee.

the Ordinances of 1976 provides in

relevant part that:

Any person who demands, accepts,

receives or retains any payment

Or rent in excess of the maximum

lawful rent, in violation of the

provisions of this Ordinance, or

any rule, regulation, or order

hereunder promulgated shall be

liable. . .to the person from

whom such payment is demanded,

accepted or received or

retained, .. .for reasonable

attorneys fees and costs as

determined by the Court, plus

liguidated damages in the amount

of $100 or not more than three

times the amount by which the

payment or payments demanded,

accepted, received or retained

exceed the maximum rent which

could be lawfully demanded,

accepted, received or retained

whichever is the greater;

provided that if the defendant

proves that the violation was

neither willful nor the result

of failure to take practicable

precautions against the

occurence of the violation the

amount of such liquidated

damages shall be in the amount

of the overcharge or

overcharges.

(20) Section 12 of Regulation 1l

of the Boston Rent Board, promulgated on

December 16, 1976 to implement the

-A39-

BEER EE ESSERE ERE ETEE

November 24, 1976 general adjustment,

provides:

A. Subject to the provisions of

this regulation the new maximum

rent as established by this

regulation may not be charged

until the expiration of any

lease or tenancy existing on the

effective date or this

regulation or unless the tenant

given the option of terminating

the tenancy under a provision of

the lease agreement.

(21) Paragraph 33 of the

form executed by the members of

plaintiff class did not contain

provision giving the tenant the

lease

the

a

option of

terminating the tenancy rather than

paying a rent increase. For this reason,

Section 12 of Regulation ll of the Rent

Board prohibited the defendants

from

implementing a rent increase pursuant to

the November 24, 1976 general adjustment

until the expiration of the leases

between Berman & Sons and the members of

the plaintiff class. Despite this, the

-A40-

BEEERE REE RES EESBE

defendants demanded, and in some cases

received, rent increases which they were

prohibitted from demanding or receiving

by Section 12 of Regulation 1l of the

Rent Board.

(22) In defending against the

alleged violation of Section 12 of

Regulation 11 the defendants argue that:

(a) the aforementioned regulation

is invalid because the Rent Board lacks

the power under the Ordinance to regulate

the implementation of rent increases;

(b) the Rent Board lacks the power

to regulate the implementation of rent

increases because that area is already

regulated by state statute and;

(c) the regulation is violative of

the United States Constitution because it

deprives the defendants of rights under

their contracts without due process of

law; and

-A41-

BHEEERREEBERERE REESE ES

(d) even if the regulation in

question is valid and was violated, the

damages awarded should be limited to the

amount of the overcharge because the

violation was neither willful nor the

result of failure to take practicable

precautions against the occurence of the

violation.

a. POWER OF THE RENT BOARD

(23) In considering the validity

of the regulation in queston the Court is

mindful that a “regulation stands in the

same footing as would a statute,

Ordinance, or bylaw. . .all rational

presumptions are made in favor of the

validity of every legislative enactment".

Druzik v- Board of Health of Haverhill,

324 Mass. 129, 138 (1949). Where an

administrative agency is vested with the

broad authority to effectuate the

-A42-

purposes of a law, as in the case of the

Rent Board pursuant to Chapter 15 of the

Ordinances of 1975, the validity of a

regulation promulgated thereunder must be

Sustained if it is "reasonably related to

the purpose of the enabling legislation".

Consolidated Cigar Corporation v.

Department of Public Health 372 Mass.

844, 855 (1977), citing Mourning Family

Publication Service, Inc,., 411 U.S. 356,

369 (1973) which quoted from Thorpe v.

Housing Authority of Durham, 393 U.S.

268, 280-281 (1969). "An agency's powers

are shaped by its organic statute taken

as a whole". Comm. v. Cerveny 373 Mass.

345, 354 (1977). "An agency is given

considerable leeway in interpreting a

Statute it is charged with enforceing"

and "a regulation may be authorized even

where it cannot be traced to specific

Statutory language". Grocery

-A43-

Manufacturers of America v. Department of

Public Health, Mass. Adv. Sh. (1979),

2291, 2296. It is also clear "that no

more need by discerned than some rational

relation between the regulation and the

empowering statute". White Dove Inc. v.

Mass. Adv. Sh. (1980) 1043, 1049. In

Summary, the law in Massachusetts is

clear that an administrative agency has

broad powers to promulgate regulations

pursuant to enabling legislation and that

all ratonal presumptions are to be made

that the regulaton is valid. So long as

the regulation is reasonably related to

the purposes of the statute the

regulation must be held valid.

(24) Since there is no dispute

that a regulation "must be within the

ambit of the enabling legislation",

Commonwealth v. Diaz 326 Mass. 525, 527

-A44-

(1950), it is appropriate to examine the

enabling legislation relied on by the

Rent Board to support the promulgation of

Regulation ll, §12. Section 2(c) of said

Ordinance provides that:

The board shall promulgate such

policies, rules, rulings and

regulations. . .as will further

the provisions of this

Ordinance. The board shall. .

-establish and adjust the

maximum rent that may be charged

for housing accomodation. .. .

Section 5(a) provides that:

The board shall. . .make such

individual or general

adjustments. . .asS may be

necessary to remove hardships or

to correct other inequities. . .

Secton 6(b) of said Ordinance provides

that:

On its own initiative, the board

may make a general adjustment. .

eof the rental levels for any

class of housing accomodation

subject to such conditions, if

any, as the board, shall

determine.

-A45-

The Preamble to Chapter 15 declares that

there is a public emergency in the City

of Boston with respect to residential

hosuing [sic], that this emergency

results from a critical shortage of

housing and that:

This emergency cannot be dealt

with effectively. . .unless

rents are regulated and

controlled so that rents will

not be increased unreasonably

and landlords will receive a

fair net operating income from

housing accomodations. ...

(25) It is clear from the Preamble

and Sections 2(c), 5(a) and 6(b) that the

Rent Board was granted the power to

promulgate reguiations affecting general

rent adjustments and to condition said

general adjustments in order to "remove

hardships or to correct other

inequities". See Palmer v. Rent Board of

Brookline, Mass. App. Adv. Sh. (1970)

260, 271 (The statute "would appear to

permit the board to condition a rental

-A46-

increase on the property's future

compliance with the State Sanitary

Code"). Pursuant to this mandate, it was

reasonable for the Rent Board to take

into consideration the fact that many

tenants who are under a lease might not

be able to afford to pay the eleven

percent general adjustment and that it

was equitable to both parties to delay

the implementation of a rent increase

until the expiration of a lease unless

the lease contained a provision which

would give the tenant the option of

paying the rent increase or moving out.

In many instances this meant a delay of a

few months in implementing the increase

and at most a delay of eight months. For

‘this reason, the Court finds no merit in

the defendants' argument that the Rent

Board lacked the power pursuant to the

-A47-

ase fe & FS

enabling legislation to regulate the

implementation of rent increases.

b. PREEMPTION BY STATE STATUTES

(26) The defendants also argue

that the Rent Board lacked the authority

to regulate the implementation of the

general adjustment because that area has

been preempted by a separate body of

state law, specifically, G.L. c. 186 and

G.L. c. 93A. There is no question that

the General Court could have so regulated

the area of the implementation of rent

increases so as to preempt the Rent Board

from enacting any regulations

inconsistent with the General Court's

statutory scheme. However, the existence

of a state statute on a particular

subject does not automatically prohibit

the enactment of local regulations on the

-~A48-

—_—_— i

Same subject. As the Supreme Judicial

Court has held:

The existence of legislation on

a subject. . .is not necessarily

a bar to the enactment of local

Ordinances and bylaws exercising

powers or functions with respect

to the same subject. If the

State legislative purpose can be

achieved in the face of a local

ordinance or bylaw on the same

subject, the local ordinance or

bylaw is not inconsistent with

the State legislation, unless

the Legislature has expressly

forbidden the adoption of local

ordinances and bylaws on that

subject.

Bloom v. Worcester, 363 Mass.

136, 156 (1973)

In a later case challenging two

amendments to Article XXXVIII of the

bylaws of Brookline which regulated

condominium conversion evictions, the

Supreme Judicial Court, in response to

the argument that the bylaw amendments

were preempted by state statutes dealing

with condominium conversions, established

a two part test to determine whether the

local bylaw was preempted by state law.

-A49-

BEREEREBEEEE AREER REE SEES

Se Bea GekatfGa a2 & =

Under this test, a conflict between local

and state law can be said to exist when

either one of the two following criteria

is met: (1) the legislature made it

clear that it intended to preclude local

action or (2) the existence of the local

bylaw makes it impossible to achieve the

purpose of the state statute. Grace v.

Town of Brookline, Mass. Adv. Sh. (1979)

2257, 2269: It is evident that the

defendants have not shown, on the facts

of this case, that the General Court

intended to preclude local action or that

the ordinance in question interferes with

the purpose of the statutes. There is

nothing in General Law c. 186 which is

inconsistent with the regulation in

question or which suggests that the

General Court intended to preempt this

area. To the contrary, the General Court

in enacting Chapter 863 of the Acts of

-A50-

TRE RRR REE RE REREER REE

1970 authorized the City of Boston to

enact an ordinance controlling rents.

Chapter 15 of the Ordinance of 1975

implements this general grant of

authority. Likewise, there is nothing in

the regulations of the Attorney General

pursuant to G.L. c. 93A, §2(c) which

indicates that the regulation in question

is in any way inconsistent with the

enforcement of the Attorney General's

regulations. The Preeable to the

Attorney General's Ch. 93A Regulations

provides that:

These rules and regulations are

not intended to be all inclusive

as to the types of activities

declared unlawful by section

2(a) but are intended to be of

general application.

940 C.M.R. Regulation 3:00

Section 3.17(3)(a)l of the Chapter 93A

Regulations provide that it shall be an

unfair and deceptive trade practice for a

landlord to include in a rental agreement

-AS1-

PBHREERE RE ER RSE SEE ERED

any term which violates any law. The

word "law" is defined in section 301(12)

as to include “any federal, state, or

local statute, ruling, regulation, code,

Ordinance or bylaw". Thus, it is clear

from the Attorney General's Regulations,

that the Regulations anticipated certain

local ordinances regulating the

landlord/tenant relationship would also

constitute a violation of Ch. 93A.

Counsel for the defendant have cited the

case of Weinstein et al v. Gordon, et al

(Civil Acton 5478) in which Chief Justice

Daher of the Boston Housing Court stated

in a June 21, 1977 decision that he did

not believe the Rent Board had the power

to enact the regulation in question

apparently because the Attorney General

had promulgated regulations determining

which practices were unfair and

deceptive. ("It is also easily

-A52-

i"

a

.

"

"

7

discernable that: Section 12

implementation: A, is not within the

power of the rent board" at p.14) The

Weinstein case presented no issue

concerning the authority of the Rent

Board to enact Section 12 of Regulation

ll and Judge Daher cites no authority in

Support of his dictum and his position

does not appear to be consonant with

appellate decisions. For example in Dodd

v.- Commercial Union Insurance Co... 373

Mass. 72 (1977) the Supreme Judicial

Court was faced with an issue analogous

to the issue presented in this case. In

Dodd the defendant insurer contended that

it was not subject to Chapter 93A because

it was regulated by G.L. c. 176D which

specifically prohibited unfair or

deceptive acts or practices in the

insurance business. In holding that Ch.

-A53-

93A and Ch. 176D overlapped but did not

conflict the Supreme Judicial Court held:

The mere existence of one

regulatory statute does not

affect the applicability of a

broad nonconflicting statute,

particularly when both statutes

provide for concurrent coverage

of their common subject matter.

373 Mass. at 782.

Likewise, in this case, the existence of

the Attorney General's Ch. 93A

Regulations do not affect the validity of

Regulation ll, section 12 especially

where the Ch. 93A Regulations

specifically anticipated local regulation

of the landlord/tenant relationship.

Since the dictum in the Weinstein case,

Supra, does not square with the appellate

authority in this Commonwealth, it will

not be followed in this case.

ce. CONSTITUTIONAL CLAIMS

(27) The defendants next argue

that the regulation in question impairs

-A54-

their contractual rights in violation of

Article I §10 of the United States

Constitution or otherwise deprives them

of property without due process of law.

Essentially, the defendants argue that

the regulation in question is being

applied retroactively to deprive them of

rights under a contract which was

executed prior to the date of the

regulation. However, an examination of

clause 33 of the lease demonstrates that

the lease specifically provides that the

landlord is not entitled to a rent

increase during the term of the lease

unless the Rent Board authorizes such a

rent increase. ("If during the term of

this lease. . .the lessor is authorized

Or permitted to increase the maximum rent

(by the Rent Board]. . .then the rent to

be paid by the lessee, commencing with

the effective date of such authorization

-A55=

3

3

3

Or permission shall be the maximum rental

so authorized or permitted.") Since

Berman & Sons in drafting its' lease

agreed that said defendant would not be

entitled to a rent increase unless

authorized by the Rent Board, the Court

fails to see how the defendants can now

argue that they are being deprived of

their rights under the.terms of the

contract simply because the Rent Board

never authorized the defendants to

increase the rent of the members of the

plaintiff class during the term of their

leases. Moreover, even if there was some

basis for finding that the defendants

have been deprived of some right under

the terms of the lease, there would still

be no showing of constitutional

deprivation because as the Supreme

Judicial Court has held:

Where a public emergency in

housing exists, the Supreme

-A56-

4 pe an = Se -

\

Court of the United States has

held that any rights contained

in a private contract must yeild

[sic] to rational legislative

protection of public interest.

Huard v. Forest Street Housing Inc., 366

Mass. 203 (1974).

d. DAMAGES

(28) The defendants finally argue

that even if the Court finds that the

regulation in question is valid, the

Court should not award more than actual

damages since the violation was "neither

willful nor the result of failure to take

practicable precaution against the

occurrence of the violation". Section

9(a) of Chapter 15 of the Ordinances of

1975. Section 9(a) places the burden of

showing that the violation was not

willful or the result of a failure to

take practicable precautions against the

occurrence on the defendants. Lynch v.

-A57-

|

o

.

7

7

5

a

:

e

‘

:

=d

e

n

Abraham, 371 Mass. 892, 893 (1976). The

undisputed facts establish that a Rent

Board official advised Berman & Sons that

clause 33 of the lease was invalid, that

at least two members of the class advised

Berman & Sons that they were informed by

the Rent Board that the general

adjustment increase could not be charged

until the termination of their leases

because clause 33 of the lease was

invalid, that Berman & Sons on February

16, 1977 wrote a letter to plaintiff

Scofield advising her that Berman & Sons

disagreed with the Rent Board's position

that no rent was due, and that even after

this Court issued a Preliminary

Injunction against the defendants from

collecting the rent increases in

question, Berman & Sons, in contempt of

this Court's Preliminary Injunction of

June 21, 1977 continued to accept the

-A58-

rent increases in question. Based on

these uncontested facts, the Court finds

that, as a matter of law, the violation

was, if not willful, then at least the

result of a failure to take practicable

precautions against the occurrence of the

violation. Assuming for purposes of this

motion for summary judgment, that Martin

S. Berman, President of Berman & Sons,

who is also an attorney licensed to

practice law in this Commonwealth, did in

fact consider the February 16, 1977

letter from the Rent Board (advising him

that clause 33 of their lease was invalid

and that he was not entitled to the rent

increase until the termination of the

leases) as a "prank" (contrary to the

position taken in Berman & Sons' letter

of February 16, 1977 to plaintiff

Scofield) Mr. Berman should have at least

taken the practicable precaution of

-A5 9-

’

contacting the purported author of the

letter or some other official of the Rent

Board to determine whether the

communication was, in fact, a "prank".

For this reason, the Court finds that the

defendants are liable to each member of

the plaintiffs class for $100 or three

times the amount of illegal rent received

or demanded whichever is greater, plus

reasonable attorney's fees.

GENERAL LAW CHAPTER 93A CLAIMS

(29) Paragraph 27 of the Second

Amended Complaint alleges as follows:

The Defendant Berman's actions

in seeking to impose rental

adjustments in the manner herein

described, namely

a) without having clearly

and conspicuously disclosed,

prior to the execution of the

lease,

(i) the nature of any

scheme by which rents could or

would be increased during the

term covered thereby and

-A60-

oe ee ee ee oe se se ee ee

(ii) the magnitude or

limits with respect to any such

increase

b) without having offered

members of the plaintiff class

the opportunity, upon

notification of a rental

adjustment, to "opt out” of the

lease by express provision or

otherwise, without further

liability for the remainder of

the term, was an unfair or

deceptive act and in violation

of the Consumer Protection Act

and regulations issued

thereunder.

Thus, the Complaint alleges three

violations of the Consumer Protection

statute. The brief in support of the

motion for partial summary judgment

alleges a fourth violation, namely, that

the demand for a rent increase from

members of the plaintiff class prior to

the termination of their leases pursuant

to the December 16, 1976 general rent

increase authorized by the Rent Board was

an unfair and deceptive practice in

violation of the Attorney General's Ch.

93A Regulations, 940 C.M.R. 3.16(3).

-A61-

ee ee ee ee ee

Since both parties have briefed this

issue the Court, pursuant to Mass. R.

Civ. P. 15(b) will amend the pleadings to

conform to the evidence so as to include

this alleged violation of 940 C.M.R.

3.16(3). Thus the plaintiff class alleges

four distinct violations of Chapter 93A,

to wit:

1. Violation of 940 C.M.R. 3.16(3)

and Section 12 of Regulation 11;

2. Failure to have clearly and

conspicuously disclosed, prior to the

execution of the lease, the nature of any

scheme by which rents could or would be

increased during the term covered by the

lease;

3. Failure to have clearly and

conspicuously disclosd prior to the

execution of the lease, the magnitude or

limits with respect to any such rent

increase; and

-A62-

4. Failure to have offered members

of the plaintiff class the opportunity,

upon notification of a rental adjustment,

to “opt out" of the lease by express

provision or otherwise, without further

liability for the remainder of the term

of the lease. With respect to the last

1

three alleged violations of Chapter 93A,

the Court finds that the defendants are

entitled to summary judgment in their

favor. The reasons for this finding are

as follows. Prior to the enactment of

Chapter 406 of the Acts of 1979, Section

9(1) of Chapter 93A only authorized a

recovery under the statute where the

consumer “suffers any loss of money or

property, real or personal” resulting

from an unfair or deceptive act or

practice. The Supreme Judicial Court has

interpreted "money" to mean money and

"property" means “the kind of property

-A63-

Sea SBQa 2 SB SS SB SE SESE EE ES

that is purchased or leased, not such

intangibles as a right to a sense of

security, a peace of mind, or to personal

liberty". Baldassari v. Public Finance

Trust, 369 Mass. 33, 45 (1975).

Assuming for purposes of this motion for

Summary judgment that the plaintiff class

has established that the use of clause 33

was an unfair and deceptive trade

practice because it did not clearly and

conspicuously disclose prior to the

execution of the lease the nature of any

scheme by which the rent could or would

be increased during the term covered

thereby and the magnitude or limits with

respect to any such increase and assuming

further that it was an unfair and

deceptive trade practice not to have

offered members of plaintiffs class the

opportunity upon notification of the

rental adjustment to "opt-out" of the

-A6 4-

3

3

lease by express provision or otherwise,

without further liability for the

remainder of the term, then the members

of the plaintiffs class are not entitled

to recover judgment pursuant to Chapter

93A unless they meet the requirement of

section 9(1) by showing that there was a

loss of "money" or "property" as a result

of the unfair and deceptive acts or

practices. In this case, there was no

evidence that the members of the

plaintiff class suffered any loss of

"money" or “property" as a result of the

alleged unfair and deceptive practices.

To the extent that members of the

plaintiffs class suffered a loss of

"money" or "property", it resulted not

from the defendants implementation of

Clause 33 of the lease but from the

defendants demand for a rent increase

even though pursuant to clause 33 of the

-A65-

lease and Regulation 1l Section 12 of the

defendants were not entitled to a rent

increase because the lease provision did

not contain an "opt-out" provision. In

other words, if the defendants had

complied with paragraph 33 of the lease

there would have been no demand for a

rent adjustment prior to the termination

of the leases.

(30) With respect to the Chapter

93A claim arising out of the violation of

Regulation 11, Section 12, the Court

finds that the plaintiff class is

entitled to summary judgment. Section

3.16 of the Attorney General's Chapter

93A Regulations provides as follows:

Without limiting the scope of

any other rule, regulation or

Statute, an act or practice is a

violation of 93A if: (3)-It

failes [sic] to comply with

existing statutes, rules,

regulations or laws, meant for

the protection of the public's

health, safety or welfare

promulgated by the Commonwealth

-A66-

aaa ee ee &

Or any political subdivision

thereof intended to provide the

consumers of this Commonwealth

protection. ...

Based on the findings, Supra, concerning

the violation of Regulation 11 section

12, the Court must also find a violation

of section 3.16 of the Attorney General's

Regulations with respect to those members

of the plaintiff class who actually paid

rent in excess of the lawful maximum rent

authorized by the Rent Board. Said

individuals sustained a loss of "money"

within the meaning of G.L. c. 93A §9(1),

as said statute was in effect prior to

the enactment of Chpater [sic] 406 of the

Acts of 1979, irrespective of whether

said individuals received refunds of said

overcharges pursuant to the preliminary

injunction issued by this Court. G.L. c.

93A §9(3) provides for damages “in the

amount of actual damages or twenty-five

dollars, whichever is greater; or up to

-A67-

'PREER REE EERE RE RB EE 1

three but not less than two times such

amount if the Court finds that the use or

employment of the act or practice was a

willful or knowing violation of section 2

of Chapter 93A or that the refusal to

grant relief upon demand was made in bad

faith with knowledge or reason to know

that the act or practice complained of

violated said section two. Chapter 93A

§9(4) also authorizes an award of

attorney's fees. However, if the Court

finds that the defendant made a

reasonable tender of settlement in

response to a Ch. 93A demand letter, the

damages awarded will be limited to the

relief tendered. The defendants argue

that a reasonable offer of settlement was

tendered and that, pursuant to G.L. c.93A

§9(3), the plaintiffs recovery should be

limited to actual damages. The burden of

proving the reasonableness of the

-A6 8-

settlement was on the defendants. Kohl

v. Silver Lake Motors Inc,., 369 Mass.

795, 799 (1976). The offer of settlement

of the defendants was as foliows:

Although we deny that we have

engaged in "fraudulent or

deceptive" practices, it is our

desire and intention to correct

any incorrectly assessed rent

increases. We think it should

be understood, however, that if

investigation shows that your

client has paid less than the

amount of rent due we would

expect to be paid the amount

owed.

This "so called" offer of settlement not

only failed to respond to the demand

letter's request that rent overcharges be

refunded, it even left open the

possibility that the defendants would

content that the plaintiffs owed the

defendants money. In essence, the

defendants' offer of settlement was that

if a Court found that they were not

entitled to the rent increases collected,

that they would return the money to the

-A6 9-

tenants. By definition, a settlement

offer is an offer to do something prior

to trial in order to avoid the necessity

of having the case go to trial. The

defendants' response to the demand letter

was hardly the type of communication

which would facilitate the settlement of

the dispute between the parties. As of

the date of the demand letter the

defendants had sufficient time to

determine their legal position and, under

these circumstances, their vague and

indefinite response was not a good faith

offer of settlement and I find that the

defendants have not met their burden of

proof. Kohl v. Silverlake Motors, Id.,

see also Pantry v. Harmony Homes Inc.

Mass. App. Ct. Adv. Sh. (1980) 1085,

1090, 1091.

(31) Based on the above findings,

I conclude that the defendants' refusal

-A70-

= — — a — —— ee ee ane

to grant relief in response to the

plaintiffs c. 93A demand letters was made

in bad faith with knowledge or reason to

know that the practices complained of

violated section 2 of chapter 93A and the

Court will award each member of the

plainiff class who paid any overcharge

damages equal to three times the amount

of said overcharge. The plaintiff class

will also be awarded reasonable

attorney's fees.

Accordingly, it is hereby ORDERED

that:

(1) At the time final judgment

enters in this action, a declaratory

judgment shall enter in favor of the

plaintiffs declaring that regulation ll,

section 12 of the Boston Rent Board

prohibitted the defendants from obtaining

a rent increase pursuant to paragraph 33

-A71-

of the lease executed by members of the

plaintiffs class.

(2) At the time final judgment

enters in this action, judgment shall

enter in favor of the plaintiff class

with respect to the claim asserted in

paragraph 26 of the Second Amended

Complaint. Counsel shall file an agreed

statement of the damages each member of

the class is entitled to pursuant to the

Court's findings within fourteen (14)

days of receipt of this Order. If no

agreement is reached, the parties should

notify the Court, and at the hearing on

the remaining issues in this case the

Court will take evidence as to the

entitlement of each member of the class.

Based on the admissions on file, it

appears that no factual dispute exists

and that it is simply a matter of making

-A72-

mathematical computations based on the

Court's findings.

(3) At the time final judgment

enters in this action, judgment shall

enter in favor of the defendants with

respect to all of the Chapter 93A claims

as described in paragraph 27 of the

Second Amended Complaint as further

amended by the Court, except for the

Claim involving 940 C.M.R. 3.16 and

Regulation ll, section 12 with respect to

which claim judgment shall enter in favor

of the plaintiff class. Counsel shall

file an agreed statement of the damages

each member of the class is entitled to

pursuant to the Court's findings within

fourteen (14) days of receipt of this

Order. If no agreement is reached, the

parties should notifiy the Court and at

the hearing on the remaining issues in

this case the Court will take evidence as

-A73-

ie a @ ™ | .een i a a gE | | ‘e e | = = |

to the entitlement of each member of the

class. Based on the admissions on file,

it appears that no factual dispute exists

and that it is simply a matter of making

mathematical computations based on the

Court's findings. In addition, within

Said fourteen (14) days counsel for the

plaintiff class shall file an affidavit

in support of the requested award of

attorney's fees. If counsel for the

defendants dispute the reasonableness of

the requested award, he shall notify the

Court, in writing with a statement of

reasons within ten (10) days of receipt

of the affidavit in support of an award

of fees, and a hearing will also be held

on this issue at the time of the hearing

on the remairing issues in this case or

at such other time as the Court may

direct.

-A74-

PREECE

(4) Within fourteen (14) days of

the date of this Order, counsel shall

advise the Court of how much time will be

needed for the trial of the remaining

issues in this case.

PATRICK J. KING

ASSOCIATE JUSTICE

November 14, 1980

cc:

Russell Fanara, Esquire

BOSTON RENT CONTROL

147 Milk Street

Boston, MA 02109

Mitchel S. Ross, Esquire

BERNKOPF, GOODMAN & BASEMAN

99 High Street

Boston, MA 02109

Harvey Shapiro, Esquire

GREATER BOSTON LEGAL SERVICES

2901 Beacon Street

Brighton, MA 02146

-A75-

PERRET Eee eae

COMMONWEALTH OF MASSACHUSETTS.

SUFFOLK, SS: HOUSING COURT DEPARTMENT

BOSTON DIVISION

CIVIL ACTION

NO. 06165

LANA J. SCOFIELD, ET AL, Plaintiff(s)

Vs.

BERMAN & SONS, INC., ET AL, Defendant(s)

AMENDED ‘Sf ee ee ee.

This action came on for hearing

before the Court, King, J., presiding and

the issue having been duly heard and

findings having been duly rendered, it is

ORDERED and ADJUDGED: 1. The Court

hereby enters a declaratory judgment that

Boston Rent Board's Regulation ll, §12,

prohibited the defendants from obtaining

a rent increase pursuant to paragraph 33

of the leases executed by members of the

plaintiff class to the extent that

members of the plaintiff class were

-A76-

tenants under a written lease with the

defendants on or about November 24, 1976.

2. Judgment shall enter in favor of each

member of the plaintiff class against

defendants Berman & Sons, Inc., Martin S.

Berman and Lila Gross with respect to

their claim for violation of Chap. 15 of

the Ordinances of the City of Boston of

1975 and Section 12 of Boston Rent

Board's Regulation 1l in accordance with

the damages set forth in appendix A

attached hereto which sets forth the name

of each member of the plaintiff class and

the damages each such person is entitled

to recover. In addition to the damages

set forth in appendix A, plaintiff

Scofield is awarded attorney's fees in

the amount of $6,189 plus costs of

$148.34.

3. Judgment shall enter in favor of the

defendants with respect to all the claims

-A77-

BEER RE RER RRR R Raa se |

of the plaintiff Scofield and the

plaintiff class except those which are

the subject of the above judgments,

including, but not limited to, the claims

of plaintiff Scofield pursuant to G.L.ch.

186, §18 and G.L.ch. 93A as described in

the above findings.

Dated at Boston, Massachusetts,

this 13th day of May, 1982.

CLERK OF COURT

-A78-

COMMONWEALTH OF MASSACHUSETTS.

SUPREME JUDICIAL COURT FOR THE

COMMONWEALTH,

At Boston, December , 1984

IN THE CASE NO. SJC-3449

LANA J. SCOFIELD & others

Vs.

BERMAN & SONS, INC. & others

pending in the HOUSING COURT OF THE CITY

OF BOSTON for the County of Suffolk No.

06165.

ORDERED, that the following entry

be made in the docket; viz., --

The case is remanded to the judge

of the Housing Court to enter an

appropriate order on Scofield's claim

under G. L. c. 186, § 18, consistent with

the principles expressed in the opinion.

-A79-

BREE BRE REE EREB EE BE ST

The judgment as to the class claim is

affirmed.

By The Court,

Clerk.

October 3, 1984

See opinion on file.

-A80-

COMMONWEALTH OF MASSACHUSETTS

SUPREME JUDICIAL COURT FOR THE

COMMONWEALTH OF MASSACHUSETTS

No. SJC-3449

BERMAN & SONS, INC., WILLIAM J.

ALLEN, MARTIN S. BERMAN, and

LILA GROSS,

Appellants

Ve

LANA J. SCOFIELD and A. LARRY

BERREN, ON BEHALF OF THEMSELVES

AND ALL THOSE SIMILARLY

SITUATED,

Appellees

NOTICE OF APPEAL TO THE SUPREME COURT OF

THE UNITED STATES

Notice is hereby given that Berman

& Sons, Inc., William J. Allen, Martin S.

Berman, and Lila Gross, the Appellants

above-named, hereby appeal to the Supreme

Court of the United States from the

decision of the Supreme Judicial Court of

Massachusetts, affirming the judgment as

to the class claim, entered on October 3,

1984.

-A81-

This appeal is taken pursuant to 28

U.S.C. §1257(2).

For the Appellants:

Mitchel S. Ross, Esquire

James B. Fox, Esquire

BERNKOPF, GOODMAN & BASEMAN

99 High Street, Suite 2050

Boston, MA 02110

Tel: (617) 542-7070

-A82-

AFFIDAVIT OF SERVICE

I, James B. Fox, attorney in the

offices of Bernkopf, Goodman & Baseman,

attorneys of record for Appellants Berman

& Sons, Inc., William J. Allen, Martin S.

Berman, and Lila Gross, depose and say

that on the 3lst day of October, 1984, I

served a copy of the foregoing Notice of

Appeal to the Supreme Court of the United

States on Harvey S. Shapiro, attorney for

Appellees herein, by delivering the same

to said Harvey S. Shapiro, Esquire, at

Greater Boston Legal Services, 68 Essex

Street, Boston, Massachusetts 02111 and

upon Francis X. Bellotti, Attorney

General of the Commonwealth of

Massachusetts, One Ashburton Place,

Boston, Massachusetts, inasmuch as 28

U.S.C. §2403(b) may be applicable.

-A83-

All parties required to be served

have been served.

James B. Fox, Esquire

Subscribed and sworn to before me, this

30 day of October, 1984:

Commission Expiration

Date: 3-25-88

-A84-

Office-Supreme Court, vs]

FILED

JAM 18 1985

2 ALEXANDER L. STEVAS,

of, CLERK

NO. 84-1027

IN THE SUPREME COURT OF THE UNITED STATES

December Term, 1984

Berman & Sons, Inc., William J. Allen,

Martin S. Berman, and Lila Gross,

Appellants

Vv.

Lana J. Scofield and A. Larry Berren,

on behalf of themselves and all

those similarly situated,

Appellees

ON APPEAL FROM THE SUPREME JUDICIAL

COURT OF MASSACHUSETTS

APPELLEES' MOTION TO DISMISS

Harvey S. Shapiro, Esq.

Greater Boston Legal Services

68 Essex Street

Boston, Mass. 02111

Tel: (617) 357-5757

2b

NO. 84-1027

IN THE SUPREME COURT OF THE UNITED STATES

December Term, 1984

Berman & Sons, Inc., William J. Allen,

Martin S. Berman, and Lila Gross,

Appellants

Vv.

Lana J. Scofield and A. Larry Berren,

on behalf of themselves and all

those similarly situated,

Appellees

ON APPEAL FROM THE SUPREME JUDICIAL

COURT OF MASSACHUSETTS

APPELLEES' MOTION TO DISMISS

Harvey S. Shapiro, Esq.

Greater Boston Legal Services

68 Essex Street

Boston, Mass. 02111

Tel: (617) 357-5757

Table of Contents

TABLE OF AUTHORITIES . ° ° . 4

STATEMENT OF THE CASE . e ° o df

SUMMARY OF THE ARGUMENT . ° » a

ARGUMENT

The Judgment Subject of

Appeal Rests On An Adequate

Non-federal Basis ' -« « &

The Appeal Does Not Present

A Substantial Federal

Question s+ « « « « oe

CONCLUSION e e . e 7 e + 17

TABLE OF AUTHORITIES

Cases

U.S. Supreme Court

Allied Structural Steel

Co. v. Warren Spannus,

483 U.S. 234, 57 L.Ed.

26 727, 98 BCs 2736

(1978) ‘ns 2 * «© ¢ s © one

Energy Reserves Group,

Inc. v. Kansas Power &

Light Co., 459 U.S. 400,

74 L.Ed.2d 569, 103 S.Ct.

697 (1983) ‘ne * « . « at

Mass. Supreme Judicial Court

American Manufacturers

Mutual Insurance Company

v. Commissioner of

Insurance, 374 Mass. 181

372 N.E.2d 520 (1978) s wha

Massachusetts Turnpike

Authority v. Perini Corp.,

349 Mass. 448, 208 N.E.

2@ 807 (1965) ..-«-+e 6 n2

McGrath v. MiShara, 386

Mass. 74, 434 N.E.2d 1215

(1982) e 7 ° e . e * . -10

Constitutional Provisions

go... Conet. Agct.« I, $49 @i i « AS

Statutes and Rules

28 U.S.C. §1257 (2) i eS ee

e

e

e

co

Supreme Court Rule 15.1 (h)

Miscellaneous

Boston Rent Control Board

Regulation 1l, Section

1l1l(c) A a a ee ie ae ia ee a ee ee

Seeger SeES

Statement of The Case

The Appellees adopt the statement

of the case contained in the Appel-

lants' “Jurisdictional Statement."

Summary of the Argument

The judgment of the Supreme

Judicial Court of Massachusetts rests

on an adequate non-federal basis,

namely, a construction by the state

court of the parties' lease

agreement. Accordingly, the judgment

of the Massachusetts Supreme Judicial

Court does not implicate Art. 1, §10,

cl 1 of the United States Constitution.

Even if the Massachusetts Supreme

Judicial Court's decision did not rest

On an adequate non-federal ground, the

appeal here would not present a

@EReeeeEaeaAaHReaAeERES AHF =

-2-

Substantial federal question. The

Appellants have failed to cite in

their jurisdictional statement a

single matter decided by this Court,

or any federal court, arguably

supportive of their contentions under

the Contract Clause. The Appellants

have similarly failed to distinguish

in any way the analysis contained in

other relevant cases which, if a bona

fide Contract Clause case were

presented, would fully support the

position of the Appellees that any

such impairment of contract as

occurred, was temporary, not

financially irrevocable, not

completely unexpected, and reasonable

in relation to the objective sought to

=3-

be accomplished, and was therefore

permissable under the Contract Clause.

Argument

I. The Judgment Subject Of Appeal

Rests On An Adequate Non-federal

Basis.

The threshhold problem that the

Appellants ("landlord") face in

contending that this Court has

jurisdiction under 28 U.S.C. §1257(2)

is that the decision of the

Massachusetts Supreme Judicial Court

from which the appeal is taken rests

on that court's construction of a

lease agreement betwen the parties and

not on an application of the Contract

Clause of the U.S. Constitution.

The landlord argues that the

Boston Rent Board Regulation which

-4-

provided that landlords were not

authorized to collect a rent increase

until existing leases had expired

unless the tenants were, under the

terms of their leases, given the

option of terminating their tenancies

instead, impaired his rights under

Article I, §10, cl.l of the U.S.

Constitution. The trial court,

however, looked to the landlord's own

lease, not the Constitution, as the

basis for denying him the right to

collect the rent increase at issue:

[A]n examination of clause 33

of the lease demonstrates that

the lease specifically provides

that the landlord is not entitled

to a rent increase during the

term of the lease unless the

Rent Board authorizes such a

rent increase. ... Since Berman

& Sons in drafting its' lease

=5~-

agreed that said defendant would

not be entitled to a rent increase

unless authorized by the Rent

Board, the Court fails to see

how the defendants can now argue

that they are being deprived of

their rights under the terms of

the contract simply because the

Rent Board never authorized the

the defendants to increase the

rent of the members of the

plaintiff class during the term

of their leases.1l

[A.55-56]. The decision of the

Massachusetts Supreme Judicial Court

was similarly premised:

By the terms of the defendants'

lease agreement the lessor was

not entitled to a rent increase

unless "authorized or permitted"

to adjust the rent under the

lfhe trial court also found that

"even if there were some basis for

finding that the defendants have been

deprived of some right under the terms

of the lease," there would still have

been no unconstitutional impairment.

[A.56-57]

-6-

"rent control laws ... regula-

ting rents ... [in] the demised

premises." This provision

clearly provides that any

adjustment would be subject

to the Rent Board's approval.

It is anomalous for the

defendant now to argue that

Regulation 11 deprived them

of rights under their lease

agreement.

[A.7-8] The state's highest court

found no inconsistency between the

lease clause and the Rent Board

regulation.“ [A.8 nl0O) That court

thus found it unnecessary to address

the issue of whether the lease here

could have been forced to yield to a

2Had the state court found the lease

ambiguous, it still would have been

required to construe it against the

drafter, the lessor. See

Massachusetts Turnpike Authority v.

Perini Corp., 349 Mass. 448, 208 N.E.

2d 807 (1965).

-7-

conflicting legislative enactment

without violating the landlord's

rights under the Contract Clause of

the Constitution.

The landlord recognizes that the

state court found it unnecessary to

address the constitutional issue.

That court, the landiord aileges,

"simply avoided the issue" which he

sought to present. Jurisdictional

Statement, at 13-14, 10. The landlord

may be unhappy with the state court's

construction of the applicable

provision of his lease, but that does

not bring him any closer to presenting

a substantial constitutional issue for

this Court to review.

In the foregoing context, the

(-EREREREREHEEREHEEBEEE SESE

-8-

landlord's inability to collect the

rent increase during the lease term

resulted not from some species of

"retroactive nullification", but

rather from the landlord's failure to

have included in his lease a clause

which would have allowed a tenant to

terminate the lease rather than pay

the increased rent. Without such a

provision tenants might have been

"locked into" leases at rentals which

they were not prepared to pay, or

which they simply could not afford, at

Substantial risk of default and

considerable liability as a result

thereof.> To suggest, on the

3The landlord's lease provided that

(cont. on next page)

-9-

other hand, that the tenants agreed to

be bound in such a manner, Jurisdic-

tional Statement, at 14, is not only

at odds with the construction of the

contract placed upon it by the state's

highest court; the very circumstances

which have traditionally prompted the

imposition of rent controls speak to a

lack of bargaining power in the market

place, such that reliance on what a

tenant may or may not have "agreed to"

(ftnt 3 cont.) in the event of a

tenant's default, the tenant would, at

the lessor's option, be liable

"forthwith" for the sum by which the

rent for the remainder of the term

exceeded the fair rental value for

that term, be liable to indemnify the

landlord for any loss of rent, a

broker's commission for reletting,

advertising costs, costs of cleaning

and repainting, and attorneys fees.

Lease, %23(A) (B).

-10-

in a lease contract is, with respect

to the rental term especially, highly

Suspect, if not entirely beside the

point.

That the clause which the

landlord failed to include in his

lease had been required earlier as a

condition to a landlord's being able

to collect a rent increase before the

expiration of an existing lease, and

was not newly contrived by the Boston

Rent Board at the time of the rent

increase here at issue, is made plain

by the decision in McGrath v. Mishara,

386 Mass. 74, 434 N.E.2d 1215, 1217

(1982). In that case the

Massachusetts Supreme Judicial Court

relied on a similar requirement in

- FES HREHRERERBEHREEBA RSE Ss = &

-lile-

connection with a rent increase by the

Boston Rent Board dating back to

March, 1975, id., at 1217--over a year

and a half prior to the circumstances

which gave rise to this case. The

landlord can thus hardly contend that

he was unfairly surprised by the Rent

Board's conditioning the immediate

collection of the rent increase here,

on the inclusion in his lease of a

provision which the Board had

previously insisted on in similar

circumstances. Indeed, there was

evidence before the state court that

the sadledtess generally was aware of,

or at least fully anticipated, the

Obligation to give tenants the

opportunity to terminate their leases

a np eS SERRE EBEEHEEREHRESE ES -&

-12-

in lieu of being required to pay a

higher rent during the term of an

existing lease. Thus the "Standard

Form Apartment Lease” of the Rental

Housing Association of the Greater

Boston Real Estate Board had, since at

least 1974, accorded tenants such

protection. See Preamble, paragraph D

to such Standard Form Apartment Lease

as set forth in Exhibit A appended

hereto.

II. The Appeal Does Not Present A

Substantial Federal Question.

Were it determined that the

contract clause was implicated by the

Rent Board regulation, the tenants

would submit that there was no

substantial impairment, that the

P>REREREEREREEBEEEERE RES

-]3-

preconditions imposed by the Board to

immediate implementation of the rent

adjustment were not completely

unexpected, and that the alteration of

the contractual relationships, if any,

were temporary, and not financially

irrevocable. Allied Structural Steel

Co. v. Warren Spannaus, 438 U.S. 234,

57 L.Ed.2d 727, 736-740, 98 S.Ct. 2716

(1978).

The landlord does not assert a

claim of confiscation, nor does he

argue that the existing rents were

unreasonably low. Cf. American

Manufacturers Mutual InSurance Company

v. Commissioner of Insurance, 374

Mass. 181, 372 N.E.2d 520 (1978). The

impairment was thus not substantial in

-l4-

the foregoing sense.

The landord was clearly engaged

in a regulated activity. The thrust

of that regulation pertained to the

adjustment of rents. The landlord was

aware of that regulatory activity and

expressly conditioned his own rights

under the lease accordingly. While

this landlord failed to anticipate

that specific contractual language

would be required to implement rent

increases during the term of the

lease, Similar requirements had

previously been imposed, and others in

the industry had incorporated such

provisions in their leases. Cf.

Energy Reserves Group, Inc. v. Kansas

Power and Light Co., 459 U.S. 400, 74

-15-

L.Ed.2d 569, 103 S. Ct. 697, 707-708

(1983) ("({T]he contracts expressly

recognize the existence of extensive

regulation by providing that any

contractual terms are subject to

relevant present and future state and

federal law. This latter provision

could be interpreted to incorporate

all future state price regulation, and

thus dispose of the Contract Clause

claim. Regardless of whether this

interpretation is correct, the

provision does suggest that ERG knew

its contractual rights were subject to

alteration by state price regulation.”)

Finally, the particular regula-

tion under attack merely deferred the

effective date of the rent increase

-16-

where tenants were not given the right

"opt out" of the lease until the

expiration date of that lease. The

Rent Board could have simply provided

that that would be the effective date

in all cases, without allowing for

increases during the lease term in any

circumstances. The landlord does not

suggest otherwise. Indeed, if for

some reason the Rent Board's precon-

dition tor immediate implementation of

the rent adjustment had imposed a

hardship on a particular landlord,

under Section ll(c) of the regulation

a further adjustment could have been

sought.”

4section ll(c) the Boston Rent Board

(cont. on next page)

«}F-

Conclusion

The landlord's appeal should be

dismissed as presenting no federal

question. The state court judgment

was premised on a construction of the

lease contract - not on some supposed

conflict between the regulation and

(ftnt 4 cont.) regulation at issue

provides:

C. HARDSHIPS:

1. For the purpose of

alleviating hardships and

other inequities, any rents

adjusted by this Regulation

may be further adjusted by

the Board according to the

provisions of the Ordinance,

and the Boston Rent

Regulations.

2. Any landlord who claims

that his maximum rents do

not yield a fair net

operating income may file an

individual Landlord Petition

for Adjustment on or after

March l, 1977.

-18-

the lease, such that the former might

be said to have impaired the latter.

The landlord was aware of this but

nevertheless he fails to explain why

this fact is not determinative of his

appeal.

Even if a claim under the

Contract Clause were presented, it

could not be characterized as

"Substantial". The landlord has not

even attempted to apply case law to

the facts of his case in order to

demonstrate some measure of

substantiality. Not a single case of

this Court is cited in argument. The

landlord has not provided any reasons

"why the questions presented are so

Substantial as to require plenary

-19-

consideration." Sp. Ct. Rule 15.1(h).

The Appellees respectfully

request that the Court dismiss the

landlord's appeal.

Lana Scofield, et al.

By her attorney,

) ’ > Sicetenteiie

Harvey S. Shapiro, Esq.

Greater Boston Legal Services

68 Essex Street

Boston, MA 02111

(617) 357-5757

January 14, 1985

APPENDIX A

Standard Form Apartment Lease

RENT

D:

[Preamble]

If at any time after the date

hereof the leased premises are

Or become subject to rent

control laws or other laws

regulating rents, and if the

Lessor is, in accordance with

such laws, at any time

authorized or permitted to

increase the rent for the

leased premises, and if at any

time thereafter the Lessor gives

written notice of his intention

to implement such increase in

whole or in part, then, in such

event and not otherwise, the

Lessee may terminate this lease

by giving notice of his

intention within thirty days

after the lessor's notice of

implementation. If the Lessee

gives such notice within thirty

days, this lease shall

terminate on the last day of

the monthly rental period next

after the date of such notice.

If the Lessee does not give

such notice within thirty days,

then the rent shall be increased

in accordance with the Lessor's

notice of implementation

commencing with the rent payment

immediately following the

expiration of said thirty day

period, but in no event’ shall the

rent exceed $ per month during

the term hereof.