Ross v. Continental Resources, Inc.
Full Opinion (html_with_citations)
Through extraordinary effort, a dispute involving roughly $15,000 mushroomed into a judgment approximating $135,000, the foundation for which is spread upon a docket comprising fifteen single-spaced pages and a correspondingly voluminous record appendix. The papers filed in the Superior Court, where the case was tried, bubble with sulphurous acrimony that, though cooled somewhat, has spilled over to the papers filed here, threatening on occasion to obscure the essential questions the appeal presents. Those questions center on the appropriateness of the initial judgment and of the trial judgeâs serial modifications of that judgment. Our review of the record leads us to conclude that the judge was correct in some respects and incorrect in others. We therefore affirm in part and reverse in part.
1. Background, a. The underlying dispute. To understand the significant twists and turns that produced the appellate issues, it is necessary to discuss the substantive and procedural history of the case in a little more detail than is customary. The dispute originated in a commercial relationship that began in the 1980âs. Stanley Ross (Stanley), one of the original plaintiffs, was then a principal in a company called Docunet Corporation (Docunet). Docunet leased computer equipment from the defendants, Continental Resources, Inc., and Continental Leasing Co., Inc. (collectively Continental).
In 1987, Docunet fell substantially behind on its lease payments, so Continental, Docunet, and Stanley entered into a new lease agreement restructuring Docunetâs obligations. Stanley
Docunet soon encountered serious financial problems and, as a result, failed to honor the obligations it had assumed under the new lease agreement. As a consequence, Docunet returned to Continental all the leased equipment and, in 1991, filed for reorganization under Chapter 11 of the Bankruptcy Code, listing Continental as a creditor to which it owed $7,500. The bankruptcy proceedings led to a fifty percent plan of reorganization. Although some creditors received payment under that plan, Continental was not among them.
Ultimately, the reorganization was unsuccessful, and in 1994, Docunet again filed for bankruptcy, this time under Chapter 7 of the Bankruptcy Code. Continental was aware of both bankruptcy actions but, believing that the debts were uncollectible, wrote them off in 1991 and made no contemporaneous effort to collect on Stanleyâs guarantee.
b. Early stages of litigation. In 1999, however, Continental apparently decided that it was worthwhile to pursue Stanleyâs guarantee and so began foreclosure proceedings against the Ross house in the Land Court, where it received a judgment under the Soldiersâ and Sailorsâ Civil Relief Act of 1940, 50 U.S.C. App. § 510 (2000), authorizing entry and sale.
By the summer of 2000, Stanley was suffering from cancer and he and Francine decided to sell their house. It was then that Francine first learned of Continentalâs second mortgage and the
The negotiations failed. Thereafter, Stanley and Francine brought an action against Continental in Superior Court seeking declaratory and injunctive relief to prevent foreclosure and damages for violation of G. L. c. 93A, breach of contract, fraud, interference with advantageous relations, âfraudulent inducement,â and intentional infliction of emotional distress. Continental counterclaimed against Stanley on his guarantee of the Docunet/Continental agreement.
After initial skirmishes, the case was set for trial on an expedited basis. The parties then agreed that Continental would discharge its mortgage in return for creation of an escrow fund into which Stanley and Francine would place $50,000 to be held until entry of final judgment.
c. Trial and decision. Escrow agreement in place, the case was tried, jury-waived, before a judge of the Superior Court, who dismissed all of Stanleyâs and Francineâs claims except their claim under G. L. c. 93A. With respect to that claim, the judge found that, although Continental asserted that Stanley owed approximately $15,000 in principal and approximately $17,000 in interest on the guarantee, Continentalâs own records were insufficient to prove that Stanley owed that or any other amount. In addition, the judge found that Continental never told Stanley or Francine about destruction of its records and resulting inability to provide any âbackupâ for its claim. Continental hid information about its record destruction from Stanley and Francine, the judge found, âin order to, and solely as a way to, leverage [Stanleyâs and Francineâs] interest in selling their house into a willingness on [their] part ... to pay money to Continental, even though it could not document or back up the actual monies owedâ and even though it knew that Stanley âwas suffering from cancer and that as a result of his illness, the Rosses intended to sell their home.â
Insofar as Continentalâs counterclaim was concerned, however, the judge stated that she disbelieved Stanleyâs trial testi
Based on the list of creditors Stanley filed in the 1991 bankruptcy proceedings, the judge found that Docunet owed Continental âat leastâ $7,500 and therefore ordered entry of judgment for Continental in that amount plus interest. With respect to Continentalâs violation of G. L. c. 93A, the judge determined that Stanleyâs and Francineâs damages were the attorneyâs fees of $10,773.36 they had incurred defending against Continentalâs foreclosure efforts. Based on a finding that Continentalâs actions were knowing and wilful, she trebled those damages to $32,321.88 and awarded Stanley and Francine $57,696.31 in attorneyâs fees for prosecution of the c. 93A claim.
d. The first judgment. Stanley died a few days after the trial ended, and his estate was substituted as a plaintiff. Francine and the estate (collectively Francine) and Continental promptly filed motions for reconsideration of the order for entry of judgment, each focusing on components of the order that were adverse to their interests. Continental, arguing that it had received an insufficient damages award, supported its motion with an affidavit from its attorney that took aim at the reliability of Docunetâs bankruptcy creditor list, which the judge had used as a basis for her damages award. In his affidavit, Continentalâs attorney said that he had never offered the list in evidence because it was âunreliable, unsupported, and false.â Instead, counsel explained, he had simply used the list while cross-examining Stanley to impeach his testimony that all of Docunetâs debts to Continental had been paid before the bankruptcy filing.
The judge denied Continentalâs motion for reconsideration but allowed Francineâs motion, saying in part that, after reading the affidavit of Continentalâs counsel, she was âno longer satisfied that the $7,500 amount [she] initially credited has any credible factual basis.â Continuing, she said that it was
ânot disputed that, by the time of trial, Continental knew*502 of the absence of a credible factual basis for this $7500.00 debt at the time. When it asked this court to find facts #57 and #58[5 ] in its Amended and Supplemental Request for Findings of Fact, Continental then believed that the $7500.00 figure lacked a credible factual basis as Ross and Docunetâs debt to them. I am no longer satisfied that Continental has met its burden of establishing the amount of money owed to them by Ross and Docunet. Accordingly, this court vacates so much of its July 15, 2002, [order for] Judgment as awarded Continental $7500.00 on Counts I and II of its Counterclaim. Judgment is to enter for Continental on Counts I and II of the Counterclaim in the amount of $1.00 plus interest since June 27, 1990.â
e. The September 20, 2005, orders dismissing Continentalâs appeal and requiring âexpeditedâ transcripts. Judgment pursuant to the order just quoted was entered on July 8, 2003, and Continental filed its notice of appeal three days later. About two weeks after that, on July 28, 2003, Continental filed a certificate stating that on July 15, 2003, it had ordered from the court reporters a transcript of all proceedings. We shall have more to say about that certificate, and the judgeâs treatment of it, later in our discussion. Of importance to the general narrative, though,
Eventually, the apparent lack of progress in the case led Francine to write a letter to the trial judge bringing to her attention the caseâs stalled progress. The judge treated Francineâs letter as a motion and conducted a series of hearings that culminated in two orders, both dated September 20, 2005, and both docketed on September 29, 2005. Because the hearings revealed that the court reporters had prepared no trial transcript, the first order required them to do so within ninety days. At Francineâs request, the order also vacated the escrow agreement, thereby permitting the escrow agent to give Francine the more than $50,000 that that account held. The second order dismissed Continentalâs appeal on grounds that Continental had not been diligent about pursuing the transcripts from the reporters.
f. The second judgment containing additional attorneyâs fees. Continental promptly filed a notice of appeal from the September 20, 2005, orders.
Francine responded with a motion for sanctions and a motion to dismiss the appeal from the order dismissing the appeal. In
After the hearings,
g. The third judgment also containing additional attorneyâs fees. Continental again appealed, filing a general notice of appeal from the second judgment and a notice of appeal to a single justice of this court pursuant to G. L. c. 231, § 6G, to the extent that the trial judge had purported to act pursuant to G. L. c. 231,
Francine again responded with a motion for sanctions, based partly on what she asserted was the untimeliness of Continentalâs motion and partly on Continentalâs appeal to the single justice, which she claimed was contrary to Continentalâs promise at various hearings to âmove forwardâ with its appeal from the order dismissing the initial appeal. After hearing,
2. Analysis and discussion. Sensible unpacking of the appellate issues Continental has extracted from the tortured history just recited requires us to proceed chronologically from back to front, for early issues are moot unless later issues are resolved in Continentalâs favor. In functional order, therefore, the issues are these: (a) those raised by Continentalâs appeal from the third judgment, namely, whether the judge properly dismissed as untimely Continentalâs motion to alter the second judgment, properly imposed sanctions and fees on Continental for filing that motion, and properly calculated those fees and sanctions; (b) those raised by Continentalâs appeal from the second judg
a. Continentalâs appeal from the third judgment. As noted earlier in the narrative, the second judgment was entered on September 28, 2006. In that judgment, the judge increased the plaintiffâs recovery by $40,890.03, or about forty-five percent, by adding additional attorneyâs fees under both G. L. 93A and G. L. c. 231, § 6F. Continental served its motion to alter that judgment on October 4, 2006, and, in the motion, also sought alteration of the first judgment, which had been entered on July 8, 2003, more than three years earlier. The judge denied Continentalâs motion as untimely and, without saying why, awarded Francine $4,510 in additional fees and sanctions. That award was embodied in the third judgment and is the only difference between the third and second judgments.
Continentalâs motion was not untimely and should not have been denied on that ground. The motion targeted the second judgment, which contained two components, one old and one new. The new component was the additional $40,890.03 in attorneyâs fees. The old component was the damages award contained in the three year old first judgment that had simply migrated without change into the second judgment. Insofar as Continentalâs motion sought alteration of the new component, the motion, served six days after the second judgment was entered, fell well within the time permitted by the applicable rule. See Mass.R.Civ.P 59(e), 365 Mass. 827 (1974).
We need not decide whether the motion was also timely as to
b. Continentalâs appeal from the second judgment. Vacation of the third judgment means that the second judgment is the operative judgment in the case. The second judgment, like the third, contains an old and a new component. The old component is the award of damages, costs, and fees embodied in the first judgment. The new component was the award of $40,890.03 in additional costs and fees against Continental for filing a motion to vacate the judgeâs September 20, 2005, order dismissing Continentalâs appeal from the first judgment.
The judgeâs September 20,2005, dismissal order was grounded on her conclusions that Continental had not acted with sufficient dispatch and diligence in ordering the transcripts necessary for the appeal. Continentalâs motion to vacate that order, filed on May 3, 2006, seven and one-half months after entry of
By marginal notation after two days of hearings, during one of which the judge orally denied Continentalâs motion, the judge allowed Francineâs motion for sanctions, finding that Continental âfiled a baseless . . . motion as they provided no new or additional information as to the correctness of this courtâs [order dismissing the appeal]. This court determines that, for this reason, fees are appropriate under both c. 93A and c. 231, § 6F [in the amount of $40,890.03] .... This court finds that the time charges and rates and work done by the plaintiffâs counsel to be fair and reasonable.â
Continentalâs motion was not âbaseless.â Indeed, as the next section of this opinion reveals, see part 2.c, infra, we think the dismissal order was error. From the outset, Continental had argued, at least in part, that its transcript difficulties were due to court reportersâ workloads and resulting inability to produce transcripts in anything resembling reasonable amounts of time, not to its lackadaisical approach to ordering transcripts and following up on their production. To amplify those arguments, Continentalâs May 3, 2006, motion invited the judgeâs attention to the fact that even her order for âexpeditedâ transcript production had no apparent effect on the reportersâ production effort. If the reporters failed to respond to the judgeâs command, Continental argued, how could it fairly be penalized for the reportersâ failure to respond to its request?
While we think that the fee award cannot be justified on the ground that Continentalâs motion was âbaseless,â some part of that award may be justified on a ground discussed at the hearing but not mentioned in the judgeâs order, i.e., the appropriateness of awarding attorneyâs fees to a prevailing party in a case
c. Allowance of the motion to dismiss the appeal from the original judgment. The next question becomes whether the judge properly dismissed Continentalâs appeal from the first judgment because of her conclusion that Continental had not been diligent in ordering transcripts from the court reporters. For the following reasons, we think that order was error.
The original judgment was entered on July 8, 2003. On July 11, 2003, Continental filed its notice of appeal. Continentalâs counsel believed that a full transcript of the trial and related proceedings was necessary for the appeal. One court reporter,
Counsel heard nothing from either reporter. Accordingly, a paralegal from his office telephoned them on January 9, 2004, and January 26,2004, to inquire about the status of the transcripts. One of the reporters replied that he had a substantial âbacklog . . . and that it would be some time before a transcript of this case would be prepared.â On February 5, 2004, the paralegal followed up with a letter to Jacques in which she said, among other things, â[w]ould you kindly forward an invoice by telefax to my attention or contact me by telephone regarding the cost of [the transcript] as soon as possible so that I may send payment via [Fjederal [E]xpress.â In a letter she sent the same day to Lynch, the paralegal said, âPlease contact the undersigned at your earliest convenience to advise what is required in way of a deposit in order to begin the preparation of the transcript.â The paralegal followed the letters with telephone calls on February 11 and 13, 2004.
Again, nothing happened, this time for about fifteen months. On May 16, 2005, another paralegal from counselâs office contacted someone at the Superior Court in Middlesex County, where the case had been tried, to determine whether anything could be done to expedite the trial transcript. He was directed to contact Jacques. This he did on May 26, 2005, and Jacques advised him âin general termsâ of the transcript costs but said that âit would take multiple months for him to transcribe all of the proceedings requested.â On May 31, 2005, the paralegal left a message for Jacques asking him to prepare the entire transcript.
Meanwhile, Francine, without the knowledge of her attorney, sent a letter dated June 3, 2005, to the trial judge asking about the status of the record assembly.
The judge held hearings on the motions on September 6, 2005, and September 9, 2005, by which time counsel for Continental had been unable to learn anything from Jacques about the status of the transcript he had paid Jacques to prepare. Moreover, at that time counsel had not received from Lynch any information about the deposit Lynch required before he would begin preparing the transcript for which he was responsible.
On September 20, 2005, the judge issued an order vacating the escrow account and ordering that the transcripts be prepared on an âexpedite[djâ basis within ninety days. On the same day, she issued a memorandum and order dismissing the appeal. In her memorandum, the judge found that Continentalâs attorney had failed to comply with Mass.RA.P. 8(b)(1), as amended, 430 Mass. 1603 (1999), which requires an appellant to âmake satisfactory arrangements with the court reporter for payment of the cost of the transcriptâ at the time the transcript is ordered. Because counsel failed to make those arrangements, the judge concluded, counsel failed in an unspecified way to comply with Mass.R.A.P. 9(c)(2). Counselâs failure to comply with rule 9(c)(2), the judge also mled, was the product of âinexcusable neglectâ for which
âBy the date of the hearings on [the motion to dismiss], on September 6, 2005 and again on September 9, 2005, [Continental] had, only recently, made payment to Mr. Jacques for his portion of the transcript but had not received a copy of the transcript. By the dates of these two hearings, [Continental] had not yet made payment to Mr. Lynch for his portion of the transcript. Consequently this court concludes that the defendants had not fully cured their noncompliance as of the last hearing date, September 9, 2005.â
One can surely understand the judgeâs frustration at the pace with which transcript preparation meandered toward an apparently indeterminate destination. She was correct in stating that âthe principal function of Rule 9(c)(2) is to put the responsibility for expediting the appeal squarely on the appellant,â quoting from Mailer v. Mailer, 387 Mass. 401, 407 (1982). Moreover, she correctly noted that the requirement to arrange payment found in rule 8(b)(1) is designed to ensure that an appellantâs order of a transcript is not an empty gesture designed simply for delay.
At the same time, an appellant cannot make âsatisfactory arrangementsâ for payment without knowledge of what payment is required. In this case, both reporters failed to respond to repeated requests for information about the required deposit for more than two years. When they finally did respond, counsel for Continental made the requisite payments immediately. On this record, therefore, we think the judgeâs conclusion that Continental violated Mass.R.A.P. 8(b)(1) was erroneous.
We also think that the judgeâs rulings with respect to Mass. R.A.P. 9(c) and with respect to the curative provisions of Mass. R.A.P. 10(c) were erroneous. With respect to the former, a violation of rule 8(b)(1) is not automatically a violation of Mass.
Finally, insofar as rule 10(c) is concerned, the quoted passage from the judgeâs memorandum suggests that she thought Continental could only invoke the ruleâs âcurativeâ provisions if it actually filed a transcript before the hearing on Francineâs motion to dismiss. However, the âcureâ of which rule 10(c) speaks is a cure of noncompliance with rule 9(c), and as just stated, compliance with rule 9(c) is achieved by doing what a clerk asks, by filing a transcript, or by filing a certificate that a transcript has been ordered. See Russell v. McOwen-Hanelt, 413 Mass. 106, 110 (1992), cert, denied, 506 U.S. 1051 (1993). As Continental had already completed the last of those three tasks, there was nothing to cure.
In the last analysis, although the burden is on the appellant to take all steps reasonably necessary to keep the appeal on track, the appellant cannot force a court reporter to do what the reporter is unable or unwilling to do. Indeed, this case shows that even after entry of a court order requiring Jacques and Lynch to produce the transcripts in ninety days, Lynchâs transcript did not materialize for eight months and Jacques took nearly fifteen months to prepare his. See note 7, supra. Remedies for those kinds of systemic delays ultimately must come from the court,
d. The first judgment. Finally, then, we arrive at the merits, where three principal issues are tendered for resolution: (i) whether the judge properly reduced Continentalâs judgment from $7,500 plus interest to one dollar plus interest; (ii) whether the judge properly found that Continental had committed unfair and deceptive debt collection practices; and (iii) whether the judge properly calculated attorneyâs fees. We think the answers to the first two of those questions are yes, and the answer to the third is no.
⢠i. Reduction of the judgment. The judge initially awarded Continental $7,500 plus interest on its counterclaim. The award was based on a bankruptcy document in which Ross stated that Docunet owed Continental $7,500. Continental sought reconsideration of that award on grounds that the bankruptcy document, which Continental had not offered in evidence, was unreliable. Then followed some wrangling among the parties as to how accurate the bankruptcy document was and why. The wrangling led to the judgeâs review of the document and the setting in which it was filed. After that review, the judge stated that she was âno longer satisfied that the $7,500.00 amount [she] initially credited ha[d] any credible factual basis.â At the time she reached that conclusion, no final judgment had entered and she was entitled to reconsider both the order she had entered and the weight she had given the bankruptcy document in fashioning that order. âThough there is no duty to reconsider a case, an issue, or a question of fact or law, once decided, the power to do so remains in the court until final judgment.â King v. Globe Newspaper Co., 400 Mass. 705, 707 (1987), cert, denied, 485 U.S. 940 and 485 U.S. 962 (1988), quoting from Peterson v. Hopson, 306 Mass. 597, 601 (1940). We discern no error in her revision.
ii. Unfair and deceptive acts. As noted, the essence of the
Continentalâs view of the judgeâs findings unduly favors its own view of the case. The essence of the judgeâs findings is that Continental pushed forward a claim it had once written off, knowing, but concealing, that it could not prove to a reasonable certainty any amount Stanley owed, and thus was likely to recover only nominal damages, see Spring v. Geriatric Authy. of Holyoke, 394 Mass. 274, 290-291 (1985); Our Lady of the Sea Corp. v. Borges, 40 Mass. App. Ct. 484, 489 (1996); Restatement (Second) of Contracts §§ 236 comment a, 346(2) (1981), because Continental had destroyed material records documenting what it claimed Docunet owed. While concealing its destruction of the records, Continental continued to push its claim in the hope that it might collect more than it could prove because it knew Stanley had cancer and that, as a consequence, the Rosses were trying to sell their home. Conduct like that âhas an extortionate quality [with a] rancid flavor of unfairness,â Atkinson v. Rosenthal, 33 Mass. App. Ct. 219, 226 (1992), and warranted the judgeâs conclusion that the conduct violated G. L. c. 93A.
iii. Attorneyâs fees. General Laws c. 93A entitles the prevailing party to recover his or her attorneyâs fees. Those fees are to be determined by the so-called âlodestarâ method, which focuses initially on fair market rate for the time reasonably spent in prosecuting the case. Killeen v. Westban Hotel Venture, LP, 69 Mass. App. Ct. 784, 790 (2007). In calculating the lodestar, no amount should be awarded for the time spent on unsuccessful claims unless that time was so inextricably intertwined with the time spent on successful claims that the two cannot be separated. Id. at 792.
The judge awarded fees in the amount of $57,696.31, ninety percent of what counsel had requested, and did not award costs. She did not make any findings indicating how and why she made the award. She also dismissed on the merits seven of the eight counts of the plaintiffsâ complaint, labeling one of them, a claim for fraudulent inducement, as ârather preposterous.â The judge also repeatedly stated that she disbelieved testimony Stanley gave on the witness stand about his payments to Continental and rejected Stanleyâs claim that the amounts he owed Continental were capped by the liquidated damages provision of the settlement agreement.
The amount of a reasonable attorneyâs fee is a fact that should be supported by some statement of reasons illuminating the judgeâs fact-finding process. Particularly is that so when the judge manifestly rejected much of the case the plaintiffs had brought. Without a statement of reasons, neither the parties nor a reviewing court has any basis for determining whether the judge put to one side the claims on which the plaintiffs failed or declined to do so on the ground that the tight nexus between the successful and the unsuccessful claims made separation of fees impossible. In addition, where a judge disbelieves substantial portions of a prevailing partyâs case, the judge must consider whether the rejected portions of the case increased the over-all fees the prevailing party incurred, and, if it did, should remove the increased portion from the ultimate fee award.
3. Conclusion. The third judgment, entered on November 3, 2006, is vacated. The order of September 29, 2005, dismissing Continentalâs appeal is vacated. The attorneyâs fee awarded in the second judgment, entered on September 28, 2006, is vacated, and the case is remanded to the Superior Court for reconsideration of attorneyâs fees in accordance with the principles contained
So ordered.
At most, a foreclosure would have given Continental a right to Stanleyâs interest in property that was wholly defeasible if, as actually happened here, Francine outlived Stanley. See Coraccio v. Lowell Five Cents Sav. Bank, 415 Mass. 145, 151-152 (1993).
By that time, the first mortgage was held by Francineâs brother and presumably was no obstacle to a sale.
throughout the proceedings, the judge, urgently prodded by Francineâs counsel, appears to have attached unduly sinister motivations to the manner in which Continentalâs attorney used the bankruptcy creditor list. Continentalâs counsel never introduced that list in evidence and, instead, consistently used it to impeach Stanleyâs testimony that Docunet had paid Continental everything it owed. In keeping with that approach, the two requested findings on which the judge focused appeared in a section of Continentalâs request entitled â[Stanleyâs] claims for credits.â The first request in that section said, â54. There is no credible evidence to support [Stanleyâs] claim that Docunet paid Continental for all invoices outstanding in 1989.â The two requests on which the judge focused, part of a series of requests supporting request 54, said simply:
â57. At the time that Docunet filed for bankruptcy in February 1991, it listed Continental as one of its twenty largest creditors, having a claim of $7,500.
â58. There was no evidence of any distributions being made to Continental as a result of Docunetâs bankruptcy.â
Nothing in the record suggests that the factual statements in those requests were untrue.
The hearings that preceded entry of the September 20, 2005, orders took place on August 17, 2005; September 6, 2005; and September 9, 2005. After entry of the orders, Continental promptly ordered transcripts of those three hearings, and those transcripts were filed on May 15, 2006.
In all, seven volumes of trial transcript were at issue. Four volumes were filed on January 24, 2007, and the remaining three were filed seriatim on February 1, 20, and 28, 2007. When the transcripts were filed, the parties were haggling over the extent to which they were properly a part of the record on appeal from the order dismissing Continentalâs appeal, Francine arguing that they were not and Continental arguing that they were because Francine maintained, among other things, that Continentalâs dismissed appeal was frivolous and, thus, that even an erroneous dismissal of that appeal caused no harm. The transcripts finally were docketed on May 2, 2007, after an order from a single justice of this court permitted their provisional inclusion as a part of the record of this case.
The hearings were held on September 21 and 22, 2006. Continental promptly ordered transcripts of the hearings, one of which was filed on October 11, 2006, and the other of which was filed on October 18, 2006.
General Laws c. 231, § 6F, provides in relevant part:
âUpon motion of any party in any civil action in which a finding, verdict, decision, award, order or judgment has been made by a judge . . . , the court may determine, after a hearing, as a separate and distinct finding, that all or substantially all of the claims, defenses, setoffs or counterclaims, whether of a factual, legal or mixed nature, made by any party who was represented by counsel during most or all of the proceeding, were wholly insubstantial, frivolous and not advanced in good faith. The court shall include in such finding the specific facts and reasons on which the finding is based.
âIf such a finding is made with respect to a partyâs claims, the court shall award to each party against whom such claims were asserted an amount representing the reasonable counsel fees and other costs and expenses incurred in defending against such claims. . . .
â[T]he court shall specify in reasonable detail the method by which the amount of the award was computed and the calculation thereof.â
For a description of the appellate path prescribed by G. L. c. 231, § 6G, see Danger Records, Inc. v. Berger, 444 Mass. 1, 8-13 (2005).
The hearing was held on October 19,2006. Continental ordered a transcript of the hearing, which was filed on October 27, 2006.
No decided Massachusetts case discusses in any detail the circumstances in which entry of an amended judgment adding attorneyâs fees creates new deadlines for motions and appeals that focus on the underlying relief the amended judgment incorporates. The lively debate that once existed on that subject in Federal circles, see, e.g., Crossman v. Maccoccio, 792 F.2d 1, 4-7 (1st Cir. 1986), seems to have been resolved in Budinich v. Becton Dickinson & Co., 486 U.S. 196, 202-203 (1988), where the United States Supreme Court said that â[cjourts and litigants are best served by the bright-line rule, which accords with traditional understanding, that a decision on the merits is a âfinal decisionâ for purposes of [appealability] whether or not there remains for adjudication a request for attorneyâs fees attributable to the case.â Our resolution of the issue arising out the of third judgment in this case makes it unnecessary to determine whether the Budinich approach should be followed in Massachusetts.
See the discussion in part 2.b, infra.
The third judgment is also an order awarding the same $4,510 in attorneyâs fees as a sanction under G. L. c. 231, § 6F. The propriety of that award is pending before the single justice and has been stayed pending a decision in this appeal. While our decision here may foreshadow the result there, we have no power now to vacate the § 6F award.
Again, the second judgment was both a judgment and an order awarding sanctions under G. L. c. 231, § 6F. Continentalâs appeal from the latter is pending before the single justice and has been stayed pending a decision in this appeal. Our ruling on the âbaselessâ issue may foreshadow the single justiceâs ruling on that appeal, but in the event that it does not, we note that the amount of the fee award has absolutely no relation to the effort Francineâs attorney expended in resisting Continentalâs motion. Instead, the award provides reimbursement for the cost of virtually every action her attorney took between entry of the first judgment and entry of the second. If there are to be any sanctions under G. L. c. 231, § 6F, those sanctions should bear a reasonable relationship to the harm caused by the sanctioned conduct. See note 9, supra.
Francineâs letter is actually dated May 23, 2005, but the judge used the June 3, 2005, date in her memorandum and order dated September 20, 2005, dismissing the appeal. Nothing turns on this discrepancy.
After the September 9, 2005, hearing, counsel apparently received from Lynch the requisite information and, under letter dated September 12, 2005, provided Lynch with a requested deposit of $100 so Lynch could begin preparation of his portion of the transcript.
The judge ruled that the certificate was defective because counselâs letters to the reporters said that he would like to âmake arrangements to orderâ a transcript, not that he âwasâ ordering a transcript. We think that reading parses the letters too fine. In context, the letters clearly ordered a transcript, and even if they did not, the follow-up letters from the paralegal in February, 2004, clearly did.
Concerned about these issues, the Supreme Judicial Court appointed a committee to explore and make recommendations regarding these issues. After a period of exploration, the committee issued a report and a series of recommendations, many of which are now in various stages of implementation. See Report of the Study Committee on Trial Transcripts, http://www.mass.gov/ courts/trialtransrep.pdf (last viewed January 8, 2009).