The Derelict Fee Statute: The Appeals Court’s Recent Decision in Conway v. Caragliano Examines Its Application

 Kimberly A. Bielan

The Derelict Fee Statute, G.L. c. 183, § 58, was initially enacted in 1971. It provides, in relevant part, that “Every instrument passing title to real estate abutting a way, whether public or private … shall be construed to include any fee interest of the grantor in such way, … unless … the instrument evidences a different intent by an express exception or reservation.” G.L. c. 183, § 58. The purpose of the Derelict Fee Statute is to “quiet title to sundry narrow strips of land.” While there are myriad circumstances in which the Derelict Fee Statute can be applied, a typical scenario would be one in which a developer of a subdivision created lots abutting a subdivision way, conveying each of the lots on the way, without referencing any interest in the way. As a practical matter, without the Derelict Fee Statute, ownership of the fee would be in a developer that, frequently, quickly disappeared following its sale of the lots. By operation of the Derelict Fee Statute, the abutting lot owners would acquire title to the way – typically to the center line of the way, though such interest may extend across the entire width of the way dependent upon the circumstances. As land use practitioners, we frequently are called upon to assess interests in ways and the applicability of the Derelict Fee Statute.

Last June, the Appeals Court issued a decision in Conway v. Caragliano (2023). The case arises out of a dispute between two neighboring property owners in Falmouth – the Conways, whose lot has direct frontage on Buzzards Bay, and the Caraglianos, whose lot is located across the street from the Conways’ property. The dispute principally concerned the ownership and easement rights in a right of way, known as 7th Shoreway, which forms the western property boundary of the Conways’ lot. The Appendix to the Appeals Court’s decision is included below and is helpful in orienting the properties.

The dispute arose because the Conways had performed significant work in 7th Shoreway, which limited the Caraglianos’ ability to use the way to access Buzzards Bay. Specifically, the Conways regraded the way, leaving only an eight-foot to ten-foot grassy strip, on which water built-up due to the installation of an irrigation system. The Conways installed large stones, planted bushes, and reconfigured their driveway in a manner that greatly impinged the historic use of the way by the Caraglianos. The Caraglianos’ historic use included walking to and from the beach and ocean, fishing, transporting small water vessels, sitting on the beach, and recreating.

The Appeals Court first assessed the ownership of the fee in the way – that is, the ownership of the land actually comprising the way. This analysis is principally informed by the language in the deeds from the subdivision developer. In short, the Appeals Court determined that, because the subject deed from the developer to the Conways’ predecessor-in-interest did not include an express reservation of the fee in 7th Shoreway, the fee in the way was conveyed with the lot. The Appeals Court rejected the Caraglianos’ argument that, because the deed included an express grant of an easement over the subdivision ways, it implied that the developer intended to retain ownership of the fee in the way. Therefore, overturning the Land Court, the Appeals Court held that the Conways own 7th Shoreway.

Second, the Appeals Court considered the Caraglianos’ easement rights. Following a discussion of the deeds, the Court noted that it was apparent that “access to the roads and shoreways shown on the plans was an ‘integral’ part of the development as a whole.” The Caraglianos benefit from an express easement over all the ways shown on the relevant plans on file with the Land Court district of the Barnstable County Registry of Deeds, including 7th Shoreway.

Finally, the Appeals Court assessed the scope of the Caraglianos’ easement rights. In analyzing the deed language creating the express easement – a “right of way in common with others entitled thereto in and over the provided ways shown on plans in registration Case No. 11518” – the Court rejected the Land Court’s conclusion that “in and over” meant something more than a right of way. The Caraglianos’ easement amounts to a right of way over 7th Shoreway. Thus, the Court concluded that the easement rights did not include a right to sit, picnic or undertake similar activity. Rather, the Caraglianos “enjoy a right of way to pass and repass over the 7th Shoreway by foot and vehicle, include the right to transport vessels and equipment over the way, for fishing, swimming, boating, and other uses traditionally reserved of the public in tidal waters, as well as the right to make reasonable repairs and improvements to the 7th Shoreway incidental to those rights.” The Appeals Court further remanded the matter to the Land Court to order a remedy as to the encroachments that had been placed in the 7th Shoreway and whether same may be retained, or whether modification is required so as not to interfere with the Caraglianos’ easement rights.

Of note, Justice Rubin of the Appeals Court dissented from the majority opinion, raising concerns “for all owners of inland property in beachfront developments in the Commonwealth…” In his dissent, Justice Rubin opined that the express grant of an easement to the Conways’ predecessor-in-interest evidenced an intent to reserve the fee in the way to the developer. He indicated that the majority’s opinion requires construing the easement grant in one manner for inland lot owners, including the Caraglianos, but in a different manner for the Conways. Justices of the Appeals Court infrequently author dissenting opinions, which may signal that that the matter is primed for further analysis and clarification before the Commonwealth’s highest court, the Supreme Judicial Court. The Caraglianos have filed a Request for Further Appellate Review, which remains pending.

Cases involving the Derelict Fee Statute tend to be fact- and document-specific. If you are facing similar issues and looking for counsel, please do not hesitate to reach out to our office for further discussion.

A principal in the Boston and Quincy-based firm of Moriarty Bielan & Malloy LLC, Kim serves on the REBA Board of Directors and co-chairs its Continuing Education Section.  She represents a variety of clients, including condominium associations, developers, and individual homeowners. Kimberly’s practice focuses primarily on real estate litigation, with an emphasis on zoning and land use matters. She also represents clients on a variety of real estate permitting matters and frequently appears before municipal boards to permit projects and to represent the interests of abutters and neighborhood groups.  She can be contacted at kbielan@lawmtm.com.

Considerations for Condominium Residents Aging in Place

Kimberly A. Bielan

 Per the U.S. Census Bureau, nearly 17% of the nation’s population – more than 56 million individuals – is 65 and older. As the Baby Boomer generation

continues to age, the percentage of the population over the age of 65 continues to increase. In choosing housing options, condominiums are an attractive option for a variety of reasons. By way of example, for individuals looking to downsize but maintain a presence in the same community, a condominium unit may provide them with local presence without the many headaches that are typically attendant to single-family home ownership, such as lawn and building maintenance. On the other end of the spectrum, other individuals may have desired to relocate to a different climate, but plans for relocation may be tabled in light of the mortgage interest rates that have recently been surging. Residents that may have once considered moving or relocating may be less inclined to do so now, in light of the increased cost associated with same. It is, thus, very important for all condominium associations – to both attract new purchasers and to provide convenience for present residents – to ensure that the community is considering its residents that are aging in place.

Here are some items to keep in mind when considering a condominium association’s population that is aging in place:

§  The importance of effective communication. As with most condominium matters, one of the keys to ensuring the needs of community residents are being addressed, and that all individuals are being afforded an opportunity to participate, is to communicate with them. Condominium associations should strive to be as transparent as possible (of course, without disclosing personal, privileged or confidential information) in communicating with homeowners. Associations should think not only about the information that is being communicated, but also about the method of communication. While Zoom and email has become a routine part of most of our lives, there may be residents who are not comfortable utilizing, or do not know how to communicate, on these platforms. Consideration should be given to providing information on multiple platforms, if feasible. By way of example, if a community newsletter is only sent by email, but certain residents do not use email, consider printing out the newsletter and delivering to their mailbox or residence.

 

§  Stay on top of maintenance obligations. It is always important to keep up with routine maintenance, but it becomes critical when residents with mobility issues are accessing and using the common areas. Repairs should be made to uneven walkways, damaged ramps, malfunctioning doors, and the like. It may be prudent to solicit feedback from residents so that the association can address areas of top concern.

 

§  Keep apprised of relevant legislation. An association should keep informed about current legislation that may impact how it manages the common area, including state legislation and local laws concerning disabilities and accessibility. The association’s counsel and trade organizations, such as CAI-NE, are helpful resources in identifying legislation that may impact associations and how best to address and comply with new laws.

 

§  Maintain family contact information. It is advisable to maintain emergency contact information, so that the association can communicate with residents’ family members in the event of an emergency. This information should be regularly updated. In collecting such information, the association should be aware of any privacy laws, and preserve the confidentiality of any information that has been provided.

 

§  Review rules and regulations to ensure that they are practical and reasonable in light of the community’s demographics. Condominium associations should regularly review rules and regulations to ensure that they are reasonable and practical in light of the characteristics of the association’s residents. By way of example, certain rules and regulations may require homeowners to maintain landscaping or to paint their front doors, but that work may be difficult for aging residents. Boards should consider the benefits and detriments of each rule and regulation and modify the rules to ensure that they continue to be reasonable.

 

§  Other considerations. There are a number of other considerations that an association may keep in mind, such as ensuring the condominium’s governing documents do not unduly prohibit modifications in architectural integrity provisions to ensure that homes can be adapted appropriately, and promoting active lifestyles for seniors, such as by encouraging attendance at community meetings, starting clubs, or planning activities, such as pickleball.

Taking the steps identified in this article will go far to attract new senior residents and to make your community a comfortable place for those aging in place to stay.   

Co-chair of REBA’s Continuing Education Section, Kim Bielan is a principal of firm Moriarty, Troyer & Malloy, LLC., and member of the firm’s litigation and zoning and land use departments. She represents a variety of clients, including condominium associations, developers, and individual homeowners. She also represents clients on a variety of real estate permitting matters and frequently appears before municipal boards to permit projects and to represent the interests of abutters and neighborhood groups.  Kim can be contacted by email at kbielan@lawmtm.com.

 

Land Court Rejects Claim of Adverse Possession Over Condominium Common Area

 Kimberly A. Bielan

Anyone living and working in the condominium field quickly learns that there are many unresolved issues and questions of law that arise.

In Pisano v. Thunberg, No. 18 MISC 000448 (RBF), 2021 WL 2656937 (Mass. Land Ct. June 28, 2021) (Foster, J.), the Land Court faced an unresolved issue and a dearth of case law. The question was whether condominium unit owners may obtain title by adverse possession over common areas of a condominium, adding that area to their unit, or whether such a claim is barred by the Massachusetts Condominium Act, G.L. c. 183A. Relying principally upon § 5 of the condominium act, the Court answered the first question in the negative, holding that such a claim is prohibited. A Notice of Appeal has already been filed, indicating that the Appeals Court may soon determine whether the Land Court’s decision is right.

Many people have a general familiarity with the concept of adverse possession, the elements of which are well-settled. In Massachusetts, a person can acquire title to recorded real property “by proof of nonpermissive use which is actual, open, notorious, exclusive and adverse for twenty years.” Sea Pines Condo. III Ass’n v. Steffens, 61 Mass. App. Ct. 838, 847 (2004), quoting Lawrence v. Concord, 439 Mass. 416, 421 (2003). “The burden of proof in any adverse possession case rests on the claimant and extends to all of the necessary elements of such possession.” Id., citing Holmes v. Johnson, 324 Mass. 450, 453 (1949).

In Pisano, the owners of a unit at the seven-unit Bradford Acres Condominium in Provincetown asserted a claim for adverse possession of a portion of the condominium’s common areas. The condominium’s master deed gives each unit exclusive use of an abutting porch, but that the yards extending beyond the porches are common areas. Upon taking ownership of their unit in 2002, the owners were informed that their unit’s deck extended onto the common areas and had done so for a period of at least 10 years. The new owners continued their use of the deck. Their use of the deck was open and notorious and, in fact, the owners of three other units had similarly extended their use beyond their porches and onto the common areas.

Faced with competing dispositive motions, the Land Court started its analysis with the condominium statute’s language to ascertain whether “the Legislature intended that unit owners be barred from obtaining title to common areas by adverse possession.”  Recognizing that a “condominium is a form of property ownership in which the unit owner retains an exclusive fee interest in his individual unit in addition to an undivided interest with all other unit owners in the condominium’s common areas and facilities,” Golub v. Milpo, Inc., 402 Mass. 397, 400 (1988), the Court cited the provisions of § 5 of the statute and concluded that “a scheme of common ownership of common areas … is antithetical to adverse possession by one of the unit owners.” “Section 5 is unambiguous: it mandates that each unit owner is entitled to a proportional, undivided interest in common areas in roughly the same percentage as their unit interest in the condominium …, that the common areas must remain undivided and cannot be partitioned …, and that the unit owners’ percentage interests in the common areas can only be modified by the consent of all the unit owners.”

In reaching its conclusion, the Land Court relied upon fundamental principles of common ownership – noting that unit owners “voluntarily buy into the condominium arrangement of property rights,” which precludes a claim for adverse possession over the common areas. Because the statute clearly and unambiguously requires the consent of all unit owners to any alteration of the unit owners’ respective percentage interest in the common areas, one unit owner cannot unilaterally alter same by asserting a claim that a portion of the common areas has been added to their unit.

As noted above, the plaintiff unit owners have already filed a Notice of Appeal, and it is likely that the Appeals Court will ultimately weigh in on this issue. In its decision, the Land Court noted the dearth of case law in Massachusetts and also readily distinguished the facts of the case from two out-of-state decisions upon which the plaintiff unit owners relied. While the Land Court relied exclusively upon the language of the act, it will be interesting to see whether the Appeals Court opines as to the ability of a unit owner to satisfy the elements of an adverse possession claim. In particular, the condominium form of ownership presents unique analytical challenges under the adverse possession framework, as unit owners already have an undivided ownership interest in the very land to which they would seek to claim adverse possession.

From a practical perspective, this decision is welcome news for condominiums boards, associations and management companies.  It would present a challenge for those managing common areas to monitor prospective claims of adverse possession in addition to their other duties.

Co-chair of REBA’s Strategic Communications Committee, Kim Bielan is a principal of Moriarty Troyer & Malloy LLC, and a member of the firm’s litigation and zoning and land use departments. She represents a variety of clients, including condominium associations, developers, and individual homeowners.  Her email address is kbielan@lawmtm.com.

Legal Sea Foods and Business Interruption Insurance

 Kimberly Bielan

As Massachusetts moves into Phase 4 of its reopening plan, residents and businesses appear cautiously optimistic. Red Sox games are on

schedule at Fenway Park (albeit at substantially reduced capacity). Spring and summer nights at Boston eateries are beckoning. But the reality of a “post-pandemic world” (if I can even venture so far to use that phrase yet) is that much will have changed. Visiting a game at Fenway may not be the same without a quick stop by Island Creek Oyster Bar and Eastern Standard beforehand, but both restaurants have closed over the past year. Of course, they are not alone. Boston.com is maintaining a running list of restaurants that have permanently closed, in large part due to the impacts of the pandemic and its associated restrictions and regulations that saw restaurants required to be closed and then substantially limited in services they were able to provide.

MTM will continue to keep you apprised as pandemic-related issues are litigated in the courts and decisions rendered that may impact how your business navigates the post-pandemic world and resumes normal operations.

Legal Sea Foods, a Boston stalwart, was not immune from the impacts of the pandemic. Legal Sea Foods locations in Park Plaza and Harvard Square closed in 2020, as did the Legal Test Kitchen in the Seaport. At the time it was announced the Park Plaza location would be permanently closing, the company noted that the location offered “no patio space, the wine cellar was exclusive to group events, and the landlord had previously expressed plans to redevelop the property.” In addition, what previously made the location valuable – its proximity to the Theater District – became less of a selling point. “[T]he area is now without theater and nearby hotels and office buildings have no real occupancy.”

While Legal Sea Foods does have many other locations in Massachusetts and several outside the state, it seems it was readily apparent to the company that the pandemic would have a substantial impact upon its business. In May 2020, while many others were still trying to assess what the COVID-19 restrictions meant for their business, Legal Sea Foods instituted an action in the U.S. District Court, District of Massachusetts, against its insurer, Strathmore Insurance Company (Strathmore), over insurance coverage for business interruption losses.

By way of background, the Legal Sea Foods lawsuit concerns a commercial property insurance policy (Policy), effective March 1, 2020. The Policy includes two provisions relevant to the lawsuit – a provision concerning coverage for lost income and expenses due to a necessary suspension of operations caused by direct physical loss of or damage to the covered properties, and a provision concerning coverage for lost income and expenses caused by action of civil authority that prohibits access to the covered properties. After making demand upon Strathmore in late March 2020, Legal Sea Foods initiated the action. As a basis for Strathmore’s claimed liability, the restaurant business cited state and local orders in response to the COVID-19 pandemic, which orders mandated that residents remain in their residences unless performing essential services and temporarily prohibited on-premises dining at restaurants. It also alleged the physical presence of the virus in its restaurants.

In the case, Legal Sea Foods asserts four claims against Strathmore: breach of contract for failure to pay business interruption and extra expense coverage; breach of contract for failure to pay civil authority coverage; unfair or deceptive acts or practices in violation of Chapter 93A; and declaratory judgment.

On Strathmore’s motion to dismiss, the U.S. District Court (Gorton, J.) dismissed the action in its entirety, holding that none of the claims asserted by Legal Sea Foods stated a claim upon which relief could be granted. In its decision, the Court noted that Legal Sea Foods’ claim – like many claims adjudicated across the country for business interruption losses – turned on the phrase “direct physical loss of or damage to” property, which was the prerequisite for coverage under the Policy. Noting that Legal Sea Foods failed to plausibly allege that its losses stemmed from the physical presence of COVID-19 at its properties (rather than the orders that had entered in connection therewith), the Court determined that the type of tangible, material and direct physical loss required to trigger coverage under the Policy was lacking. “The COVID-19 virus does not impact the structural integrity of property in the manner contemplated by the Policy and thus cannot constitute ‘direct physical loss of or damage to’ property.” In support of such holding, the Court cited to multiple decisions throughout the country that have reached the same conclusion.

Similarly, the Court concluded that the orders were insufficient to trigger business interruption losses resulting from an action of civil authority, as that Policy language was triggered only if the authority “prohibits access” to the covered properties. The Court identified that, while restaurants were required to close and access limited, there was no specific order “that expressly and completed prohibited access to” any of the covered restaurants. Indeed, the orders “permitted [Legal Sea Foods’] restaurants to continue carry-out and delivery operations.” The Court noted that, under its decision, it “is immaterial whether it is economically feasible for Legal to continue restaurant operations …. Rather, the relevant inquiry is whether the [orders] prohibited access to” the covered properties. Accordingly, while access was limited, it was not prohibited, and Legal Sea Foods was not entitled to civil authority coverage.

On the basis of the foregoing, the Court dismissed the remaining claims against Strathmore. Legal Sea Foods has recently appealed the Court’s decision, which appeal remains pending. (Click on this link to view the Legal Sea Foods, LLC v. Strathmore Insurance Co. case).

As with any litigation, Legal Sea Foods’ case is fact-specific and dependent on the language contained in the Policy. Nevertheless, the Court’s citation to numerous decisions throughout the nation in support of its dismissal of the case demonstrates that the courts are likely to take a relatively restrictive view of language contained in insurance policies notwithstanding the recognized devastating impact that the pandemic has had across all industries, not least of which is the restaurant industry.

MTM will continue to keep you apprised as pandemic-related issues are litigated in the courts and decisions rendered that may impact how your business navigates the post-pandemic world and resumes normal operations.

Originally posted April 25, 2017 on tlawmtm.com.

https://www.lawmtm.com/boston-business-interuption-insurance.html

Co-chair of REBA’s strategic communications committee, Kim Bielan is an associate in the litigation and zoning and land use departments of Moriarty, Troyer & Malloy LLC. Kim’s practice focuses primarily on real estate litigation, with an emphasis on zoning and land use matters. She can be contacted by email at kbielan@lawmtm.com.

SJC Holds that Grandfathered Structures May Increase Nonconformity with Only a Finding

By Kimberly Bielan

Earlier this month, the Massachusetts Supreme Judicial Court (“SJC”) issued a decision holding that, pursuant to the statute

Kimberly Bielan

governing modification of grandfathered (i.e., preexisting nonconforming) structures, the dimensional nonconformities of one- and two-family residential structures may be increased upon a finding that there will be no substantial detriment to the neighborhood. The decision is significant because the SJC explicitly determined that such structures need not obtain a variance, notwithstanding the fact that a nonconformity is being increased – that is, rendered more noncompliant with the existing zoning by-laws. The case hinges on the SJC’s interpretation of what it describes to be the “difficult and infelicitous” language contained in the first paragraph of G.L. c. 40A, § 6, which is the statute governing preexisting nonconforming structures and uses in the Commonwealth.

The decision is significant because the SJC explicitly determined that such structures need not obtain a variance, notwithstanding the fact that a nonconformity is being increased – that is, rendered more noncompliant with the existing zoning by-laws.

In Bellalta v. Zoning Board of Appeals of Brookline, 481 Mass. 372 (2019), homeowners in Brookline sought to modify the roof of their two-family house to add a dormer. The home was on an undersized lot, and the sole preexisting dimensional nonconformity of the structure was its floor area ratio (FAR). While the zoning by-laws required an FAR no greater than 1.0, the structure’s existing FAR was 1.14; the proposed addition, though modest in nature, would further increase the nonconformity to 1.38. The homeowners applied to the Zoning Board of Appeals of Brookline (“Board”) for a special permit (which incorporated the finding of no substantial detriment under the local zoning by-laws), which was granted. Certain abutters to the property appealed to the Land Court pursuant to G.L. c. 40A, § 17, arguing that the homeowners were also required to obtain a variance because the modification would increase the nonconforming nature of the structure. The Land Court rejected the argument and affirmed the Board’s decision granting the special permit. On appeal, the SJC granted the petition for direct appellate review.

In its decision, the Court held that “the statute requires an owner of a single- or two-family residential building with a preexisting nonconformity, who proposes a modification that is found to increase the nature of the nonconforming structure, to obtain a finding under G.L. c. 40A, § 6, that ‘such change, extension or alteration shall not be substantially more detrimental tha[n] the existing nonconforming use to the neighborhood.’ The statute does not require the homeowner also to obtain a variance in such circumstances.” In reaching such conclusion, the SJC first analyzed the statutory framework (noting, again, that the “language of G.L. c. 40A, § 6, has been recognized as particularly abstruse”) and legislative history, recognizing that the Legislature intended to afford greater protections to one- and two-family residential structures under the Zoning Act.

Accordingly, the Court endorsed the framework previously set forth

by the Appeals Court in Willard v. Bd. of Appeals of Orleans,(1987). Under this approach, there must be an initial determination by the permitting authority to “identify the particular respect or respects in which the existing structure does not conform to the requirements of the present by-law and then determine whether the proposed alteration or addition would intensify the existing nonconformities or result in new ones.” If the answer to this question is “no”, then the applicant is entitled to a permit to proceed immediately with the proposed alteration. If, however, the answer to the question is “yes”, then the homeowner must obtain a finding (often, but not always, incorporated into a special permit requirement in municipal zoning by-laws) that the proposed modification will not be “substantially more detrimental to the neighborhood.” As the SJC stated, it is “[o]nly if a modification, extension, or reconstruction of a single- or two-family house would ‘increase the nonconforming nature of said structure’ [that it must] ‘be submitted … for a determination by the board … .” There is no requirement that a homeowner obtain a variance when increasing a preexisting dimensional nonconformity.

The practical implications of the Bellalta decision are, in some respects, confounding, and an example is likely helpful. Suppose a town’s zoning by-laws require a ten (10’) foot side yard setback, and there is an existing structure that is eight (8’) feet from its side property line at the time the by-laws become effective. Such structure would be considered lawfully preexisting nonconforming, and the homeowner would be able to maintain the structure in its present location. Under the Bellalta decision, if the homeowner proposed to modify this structure, he or she could further expand into the side yard setback; that is, he or she could further encroach into the side yard and, for example, build five (5’) feet from the property line upon receipt of a finding that such construction would not be substantially more detrimental to the neighborhood. At the same time, a homeowner on a neighboring property, whose structure complies with the ten (10’) foot side yard setback, would not be able to expand further into the side yard. Instead, because the second homeowner’s structure is compliant with the zoning by-laws as adopted, a variance would be required. The difference is substantial, as the showing for receipt of a variance is much more rigorous than for a finding.

While the Bellalta decision definitively answers the relief necessary for a one- or two-family preexisting nonconforming structure under G.L. c. 40A, § 6, it may incite the Legislature to finally address the difficult language contained in the first paragraph of the statute. At the same time, there are certain limitations to the decision. The holding is applicable only to single- and two-family dwellings and is inapplicable to commercial structures. In addition, the Court declined to address the issue of what relief would be necessary when there is the creation (rather than a modification, extension, or reconstruction) of a new nonconformity.

1 As the SJC explained in Bellalta, a “preexisting nonconformity is a use or structure that lawfully existed prior to the enactment of a zoning restriction that otherwise would prohibit the use or structure.” Effective November 2016, structures that have been constructed (even without benefit of a building permit or otherwise in noncompliance with applicable zoning by-laws) and not subject to an enforcement action for a period of ten (10) or more years will also be treated as preexisting nonconforming structures, entitled to the protections of G.L. c. 40A, § 6.

Co-chair of REBA’s strategic communications committee, Kim Bielan is an associate in the litigation and zoning and land use departments of Moriarty, Troyer & Malloy LLC. Kim’s practice focuses primarily on real estate litigation, with an emphasis on zoning and land use matters. She can be contacted by email at kbielan@lawmtm.com.

Legislative Update: Governor Baker Signs Non-Compete Bill, to be Effective October 1, 2018

By Kimberly Bielan

On August 10, 2018, Governor Baker signed a bill into law, which governs noncompetition agreements.

The new law, to be codified at G.L. c. 149, § 24L, is effective October 1, 2018. The statute, which is the result of nearly a decade of legislative action, codifies – for the first time in Massachusetts – the law governing noncompete agreements in employment. While it largely tracks many aspects of existing common law (developed over time in court decisions), it also includes significant changes that employers, such as management companies, will need to keep in mind when requesting employees execute a noncompete agreement.

The Basics

The statute defines a noncompetition agreement, in relevant part, as “an agreement between an employer and an employee ... under which the employee … agrees that he or she will not engage in certain specified activities competitive with his or her employer after the employment relationship has ended.” The law expressly provides that an “employee” includes independent contractors.

A noncompetition agreement may be entered into either (1) in connection with the start of employment, or (2) during employment. If entered into at the start of employment, the agreement must be in writing, signed by both the employer and employee, expressly state that the employee has the right to consult with counsel prior to signing, and must be provided to the employee by the earlier of a formal offer or ten (10) business days prior to the commencement of employment. If a noncompetition agreement is entered into during employment, it must be supported by fair and reasonable consideration independent from continuation of employment and notice must be provided at least ten (10) business days prior to the effective date of the agreement. In addition, any agreement executed during employment must be in writing, signed by both the employer and employee, and expressly state that the employee has the right to consult with counsel prior to signing.

In addition to the foregoing, all noncompetition agreements must have the following attributes:

▪ No broader than necessary to protect the legitimate business interests of the employer;

▪ Restricted period cannot exceed one (1) year, subject to an exception in the event an employee breaches his or her fiduciary duty to the employer or has taken property belonging to the employer, in which case the duration may not exceed two (2) years from the date of cessation of employment;

▪ Reasonable in geographic reach in relation to interests protected; and

▪ Reasonable in scope of proscribed activities in relation to the interests protected.

The new law also includes a requirement that noncompetition agreements be supported by a garden leave clause or other mutually agreed upon consideration. A garden leave clause is “a provision within a noncompetition agreement by which an employer agrees to pay the employee during the restriction period.” The garden leave clause must provide for payment on a pro-rata basis during the entirety of the restriction period of at least 50% of the employee’s highest annualized base salary within the two (2) years prior to termination of the employee.

The statute also provides that a reviewing court may, in its discretion, reform or otherwise revise an agreement to render it valid and enforceable; that any litigation to enforce an agreement must be brought in the county in which the employee resides; and, importantly, that the new law is not retroactive and is only applicable to new agreements entered on or after October 1, 2018.

The Changes

The statute codifies, for the first time in Massachusetts, the law relative to noncompetition agreements. While case law has developed over the years to help define what is and is not lawful, the statute sets forth clear requirements with which a noncompete agreement must comply in order to be deemed valid. In some respects, this codification reflects a change in the law. For example, pursuant to the statute, and subject to limited exception, the restricted term may not exceed one (1) year. This represents a departure from existing law, as courts have historically recognized noncompetition agreements for a duration of two (2) years, or even more, as appropriate in certain circumstances.

The new law provides added “bargaining power” to employees in an area that may historically have been perceived as draconian and contrary to the employee’s interests. The statute sets forth requirements for noncompete agreements signed both prior to and during employment and expressly provides that an employee must have an opportunity to review the provisions of any agreement with counsel of his or her own choosing.

In addition, by including a requirement that an agreement contain a garden leave clause, the new law is likely to encourage an employer to take a hard look at the duration of any noncompete agreement to assess whether it is a sound business decision – that is, whether the benefit of restricting the former employee at a cost of at least 50% of his or her most recent salary outweighs the benefit of competing with the employee.

Looking Forward

Like any legislation, the statutory language raises some questions that will need to be addressed by decisional law. For example, the statute provides that noncompetition agreements signed during employment must be supported by additional “fair and reasonable consideration” beyond continued employment. What would constitute such “fair and reasonable consideration” will likely not be clear until case law develops.

In addition, while the statute is expressly applicable only to new agreements, it would be advisable for management companies and the like to review existing agreement to assess their compliance with the new law and to consider making changes to the provisions of same to bring them into compliance with the statute.

Originally posted September 28, 2018 on tlawmtm.com.

https://www.lawmtm.com/non-compete-bill-law-massachusetts.html

Kim Bielan is an associate in the litigation and zoning and land use departments of the Braintree-based firm of Moriarty, Troyer & Malloy, LLC.  She represents a variety of clients, including condominium associations, developers, and individual homeowners. Kim’s practice focuses primarily on real estate litigation, with an emphasis on zoning and land use matters. She also represents clients on a variety of real estate permitting matters and frequently appears before municipal boards to permit projects and to represent the interests of abutters and neighborhood groups; she can be contacted by email at kbielan@lawmtm.com.

A Tale of Two Adjacent Lots

By Kimberly A. Bielan

Like most matters, a property owner’s request for enforcement of a municipality’s zoning bylaw is subject to a limitation period.

Recently, in Bruno v. Zoning Bd. of Appeals of Tisbury, 93 Mass. App. Ct. 48 (2018), the Appeals Court had an opportunity to analyze the interplay between the statute of limitations contained in the Zoning Act, G.L. c. 40A, § 7, and the endorsement of an approval not required (ANR) plan showing zoning violations. Specifically, the Appeals Court held that the limitations period begins to run from the date one of the lots on the ANR plan lots is conveyed rather than the date the zoning board approved the ANR plan.

Specifically, the Appeals Court held that the limitations period begins to run from the date one of the lots on the ANR plan lots is conveyed rather than the date the zoning board approved the ANR plan.

The Basics

The Bruno case involves the interaction of fundamental zoning principles and reached a conclusion that is logical based upon these maxims, but which had not yet been explicitly decided in the Commonwealth. These principles include:

• Statute of Limitations. A statute of limitations bars claims after a specified period by establishing a time limit for suing in a civil case, based upon the date when the claim accrued. The Zoning Act, G.L. c. 40A, contains statute of limitations in § 7. While overly simplistic, there are three applicable limitations for enforcement in the Zoning Act: for structures built pursuant to a building permit, 6 years; for structures not built pursuant to a building permit, 10 years (which structures are now deemed to have “grandfathered” status and constitute legally nonconforming buildings); and for uses pursuant to a building permit, 6 years. Notably, there is no limitations period relative to an unauthorized use that is not identified in a building permit, and an action to enforce a violative use may be brought at any time.

• ANR Plan. An ANR plan is a plan showing division of a property that does not require approval under the subdivision control law. The plan is submitted to a municipality’s planning board and, if approval is not required under the subdivision control law, the planning board must endorse the plan. A planning board’s review of such plan is limited to whether the plan shows a subdivision – it does not look at the zoning compliance of the resulting lots as that is beyond the board’s purview. While a planning board’s endorsement of an ANR plan may be appealed, such appeal concerns only whether the planning board’s determination as to whether the plan is entitled to endorsement was proper.

• Doctrine of Merger. The common law doctrine of merger provides that adjacent nonconforming lots held in common ownership shall be treated as “merged” as a single lot for zoning purposes. The underlying objective of the doctrine is to reduce nonconformities. An example may be helpful. A residential zoning district requires lots to have a minimum size of 40,000 sq. ft. I own two adjacent lots, each containing 20,000 sq. ft. For zoning purposes, those lots will be treated as a single, merged lot.

The Case

In Bruno, the defendant property owners and their family owned a parcel in Tisbury on Martha’s Vineyard. In 2001, the property owners obtained endorsement of an ANR plan, which divided the parcel into two adjacent lots – Lot 1 and Lot 2. Lot 1 contains an accessory structure that had been permitted for use as a guest house, and Lot 2 contains the main single-family structure. While the ANR plan proposed to divide the original parcel into two lots, which would result in certain dimensional violations of the zoning bylaw, the owners continued to hold the lots in common ownership. Indeed, after 2001, the property owners figuratively put the endorsed ANR plan in a drawer and took no further action with respect thereto. In 2005, and after the passage of four years, the defendant property owners then sold Lot 2. Subsequent thereto, in or around 2013, the plaintiffs became aware of the zoning violations and sought enforcement. Enforcement was denied, and affirmed by the zoning board of appeals, on the basis that the enforcement was untimely.ⁱ

On appeal to the Land Court pursuant to G.L. c. 40A, § 17, the Court considered a novel issue: whether the 10-year statute of limitations for zoning violations shown on an ANR plan commenced running upon endorsement of the ANR plan or upon alienation of one of the lots, resulting in realization of such violation. The Court held that, as the enforcement request was not initiated until 2013 – more than 10 years after the endorsement of the ANR plan – it was time-barred. The Court reached such conclusion on the basis that “in the eyes of the law, there were … violations in existence starting when the ANR plan was endorsed.”

On appeal, the Appeals Court reversed that portion of the Land Court’s decision relating to the 10-year statute of limitations, holding that “the ten-year statute of limitations under G.L. c. 40A, § 7 – which governs actions to compel the removal of a structure because of alleged zoning violations – commenced at the time that the lot containing the primary house was conveyed, rather than at the endorsement of the approval not required (ANR) subdivision plan.” In reaching this conclusion, the Appeals Court relied upon the common law doctrine of merger and determined that “Lot 1 and Lot 2 must therefore be viewed as a single conforming lot until the 2005 conveyance, regardless of the prior ANR subdivision.”

As pointed out by the Court, not only was the decision logical in light of the applicable doctrines, but it also preserves the interests of neighboring property owners. “If we construed the statute of limitations as commencing upon the ANR endorsement, any property owner could obtain an ANR endorsement for a subdivision plan and then wait ten years to separate the lots, thus creating nonconforming lots without any opportunity for the town to enforce its zoning by-law. Our construction, by contrast, allows the town ten years after the lots are separated to enforce its zoning by-law, consistent with the Legislature’s intent.”

ⁱ The municipality relied upon the 6-year statute of limitations in § 7, which was indisputably erroneous.

Originally posted April 25, 2017 on tlawmtm.com.

http://lawmtm.com/statute-limitations-zoning-violation.html

Kim Bielan is an associate in the litigation and zoning and land use departments of the Braintree-based firm of Moriarty, Troyer & Malloy, LLC.  She represents a variety of clients, including condominium associations, developers, and individual homeowners. Kim’s practice focuses primarily on real estate litigation, with an emphasis on zoning and land use matters. She also represents clients on a variety of real estate permitting matters and frequently appears before municipal boards to permit projects and to represent the interests of abutters and neighborhood groups; she can be contacted by email at kbielan@lawmtm.com.

A Refresher on Adverse Possession and Prescriptive Easements

By Kimberly Bielan

In thinking about the cases that we have handled over the past year when I was trying to determine a topic for this month’s newsletter

article, I realized that we have had a number of questions regarding adverse possession, most often in the context of boundary disputes. In each of the cases that we have handled, there has been a change in circumstance (most frequently, new ownership of either one or both of the properties involved), which have brought matters relating to location of fences and established uses to a head. While it is always exciting to share legal updates with our clients – as Dave Rogers does in his discussion of Trustees of the Cambridge Point Condominium Trust. v. Cambridge Point, LLC, in which the SJC struck down a so-called “poison-pill provision” for a condominium’s governing documents that sought to chill the condominium trust’s ability to litigate – in light of the frequent inquiries that we have received on the topic of adverse possession and boundary line disputes, I thought a refresher on adverse possession would prove beneficial. While many people are able to recite the requisite duration to establish adverse possession – 20 years – several of the other requirements to obtain title may not come to mind quite as readily. The common law doctrine of adverse possession, and the related doctrine of prescriptive easements, remain powerful mechanisms by which property interests may be altered.

Adverse Possession

To establish title to land by adverse possession, a party must demonstrate that each of the following is satisfied:

Actual Possession It may seem self-evident that in order to claim title by adverse possession, one must actually be in possession of the land to which he claims title. But what constitutes “actual” possession varies under the circumstances. “The nature and the extent of occupancy required to establish a right by adverse possession vary with the character of the land, the purposes for which it is adapted, and the uses to which it has been put. Evidence insufficient to establish exclusive possession of a tract of vacant land in the country might be adequate proof of such possession of a lot in the center of a large city.”i The touchstone is thus whether the individual in possession is controlling the subject property in a manner similar to that usually associated with ownership.

Visible and Notorious Possession

The possessor’s occupation of the land must be open and notorious, so as to put the titled owner on notice of the hostile activity. “To be open the use must be made without attempted concealment. To be notorious it must be known to some who might reasonably be expected to communicate their knowledge to the owner if he maintained a reasonable degree of supervision over his premises.”iii Notably, there is no requirement that the true owner have actual notice of the use in order for the use to be deemed notorious.iii What is necessary, though, is that the use be “open to the world to see.”iv

Exclusive Possession

 The adverse possessor must hold the subject property to the exclusion of all others, including the true owner. The “gold standard” for establishing exclusivity is the erection and maintenance of a fence in a location such that it excludes the record owner from accessing the subject property.v

Continuity of Possession

 Possession of the subject property must be continuous for 20 years, with no significant interruption of possession. Continuity of possession must be viewed in light of the use to which the land would be normally used. For example, if an adverse possessor uses a seasonal cottage without heat for a period of 20 years, but is not present during the winter, such use may still be deemed continuous for purposes of satisfying this element. Similarly, the property need not be possessed by one individual for the entire period. Rather, where there is privity of estate between those in possession, the possessors may “tack” the time of occupation to each other to satisfy the 20-year requirement.

Hostile Character of Possession

 The use of the subject property must be without permission from the titled owner. “The essence of nonpermissive use is lack of consent from the true owner.” The inquiry into whether use is permissible or non-permissive is fact-intensive. “Whether a use is nonpermissible depends on many circumstances, including the character of the land, who benefited from the use of the land, the way the land was held and maintained, and the nature of the individual relationship between the parties claiming ownership.”vii

In ascertaining whether adverse possession has been established, the inquiry is largely fact-based, and different circumstances may produce unique results. However, there are a few additional things to keep in mind:

▪ Title to registered land (as compared to recorded land) cannot be acquired by adverse possession. Thus, even if each of the elements for establishing title by adverse possession are otherwise satisfied, the claim will fail.

▪ The intent of the adverse possessor is irrelevant. “[C]ourts must look to the physical facts of entry and possession as evidence of an intent to occupy and to hold property as of right.”viii

▪ Just like any other individual and/or entity, a condominium association has standing to bring a claim of title by adverse possession. ix

Prescriptive Easements

When one using certain land is unable to establish title due to a lack of exclusive use, he may still be able to establish an easement by prescription over the subject property, which enables him to continue to use the land consistent with his historic use. “It is not necessary … for one claiming an easement by prescription to show that his use has been ‘exclusive’ … .” In seeking to establish an easement by prescription, though, the location of the easement must be fixed. For example, if a party is seeking to establish use of a swath of land as a passageway, he must establish that the easement is “substantially confined to a regular and particularized route.”xi Aside from this, the requirements for establish a prescriptive easement largely mirror those required to establish title by adverse possession. Thus, a claim to a right to use by prescriptive easement may be advanced in the alternative to a principal claim for adverse possession.

As referenced above, many of the cases that we have recently had involving claims (or potential claims) of adverse possession have involved boundary line disputes that have been brought to a head in light of recent changes in circumstance, such as changes in ownership. As many owners desire to maintain friendly relationships with their neighbors, it is often a good first step to try to discuss each party’s expectations and understandings relative to the disputed property. However, as recently noted in a decision of the Land Court: “If good fences make good neighbors, sometimes bad fences can ruin a neighborly relationship.”xii When that happens, it likely makes sense to consult counsel. Cases involving claims to title and use run the gamut in terms of how they are resolved. While a letter or filing of a Complaint may be in and of itself sufficient to bring a neighbor to the table to reach reasonable resolution, other matters may lead to full litigation of the dispute.

The “refresher” information provided herein is intended to provide you with an overview of the doctrines of adverse possession and prescriptive easements, but is in no way intended to present a full treatise on the issues – it would take many more pages to do so.

If you think that you may have a matter implicating adverse possession or other claims concerning interests in real property, Moriarty Troyer & Malloy has substantial experience in these areas.

iLa Chance v. Rubashe, 301 Mass. 488, 490 (1938).

iiFoot v. Bauman, 333 Mass. 214, 218 (1955) (citation omitted).

iiiId.

ivLawrence v. Town of Concord, 439 Mass. 416, 423 (2003).

vSee, e.g., MacNevin v. Carroll, No. 15 MISC 000146 (HPS), 2016 WL 763073, at *4 (Mass. Land Ct. Feb. 25, 2016) (Speicher, J.).

viTotman v. Malloy, 431 Mass. 143, 145 (2000).

viiId.

viiiKendall v. Selvaggio, 413 Mass. 619, 624 (1992).

ixSee generally Sea Pines Condo. III Ass’n v. Steffens, 61 Mass. App. Ct. 828 (2004).

xLabounty v. Vickers, 352 Mass. 337, 34 (1967).

xiStone v. Perkins, 59 Mass. App. Ct. 265, 265 (2003).

xiiSerrano v. Brosnan, No. 14 MISC 482350 (HPS), 2016 WL 5900082, at *1 (Mass. Land Ct. Oct. 11, 2016) (Speicher, J.).