Court Opinion

ID: 9407457
Source: CourtListenerOpinion
Date Created: 2023-07-07 14:07:47.703347+00
Date Added: 2024-06-11T17:20:38.307182
License: Public Domain

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22-P-850                                                Appeals Court

        SUGARMAN & SUGARMAN, P.C.     vs.    DANIEL B. SHAPIRO.1

                             No. 22-P-850.

            Suffolk.       March 1, 2023. – July 7, 2023.

           Present:    Green, C.J., Blake, & Englander, JJ.

Damages, Quantum meruit, Breach of contract. Contract,
     Attorney, Compensation of attorney, Employment, Performance
     and breach. Evidence, Settlement offer. Practice, Civil,
     Instructions to jury, Judgment notwithstanding verdict, New
     trial.

     Civil action commenced in the Superior Court Department on
March 16, 2018.

    The case was tried before Peter B. Krupp, J.

     Richard B. Reiling for the defendant.
     Allen N. David (Avana A. Epperson-Temple also present) for
the plaintiff.

    GREEN, C.J.       The principal question in this appeal is

whether the trial judge erred in submitting to the jury the

plaintiff's claim for damages under a theory of quantum meruit

    1   Doing business as Shapiro & Associates.
                                                                     2

despite the existence of a fully integrated written contract

between the parties.     We conclude that, because the

circumstances giving rise to the plaintiff's claim fell outside

the terms addressed by the parties' agreement, the judge

properly submitted the claim to the jury, and we affirm the

judgment.2

     Background.   The plaintiff is a Boston law firm that

specializes in personal injury cases.    The defendant headed up a

law practice that specializes in federal workers' compensation

cases (OWCP practice).    Effective March 1, 2016, the plaintiff

and the defendant entered into an employment and purchase of

practice agreement (agreement) under which they agreed to work

together through at least March 30, 2019, and possibly March 30,

2020, with respect to the defendant's law practice.      Under the

parties' agreement, for the year beginning on April 1, 2019, and

continuing through March 30, 2020,3 the defendant held the option

either to continue working or to retire, with differing

compensation depending on which option he chose.     Upon the

     2 The defendant also raises challenges to (1) the judge's
instructions to the jury on the quantum meruit claim, (2) the
court's jurisdiction over the claims, (3) certain evidentiary
rulings by the trial judge, and (4) the denial of his motion for
judgment notwithstanding the verdict and for new trial.

     3 The agreement described various years as running from
April 1 to March 30, despite the fact that March has thirty-one
days. Nothing in our decision turns on this fact.
                                                                    3

defendant's retirement, the plaintiff was to have control of the

entire OWCP practice.   From and after the defendant's

retirement, however, the agreement provided for compensation to

the defendant for seven additional years, in the form of a

portion of revenues from the OWCP practice.

     During the first year of the agreement, the plaintiff was

to provide space for the defendant in its office, as well as

"experienced attorney work" to support the OWCP practice.     The

agreement "contemplated that sometime prior to the expiration of

[y]ear [one], [the plaintiff] will designate an attorney to

devote [one hundred percent] of his/her professional time to the

OWCP [p]ractice with other attorneys and support staff

continuing to provide sufficient resources to continue to

maintain a high level and quality of service to federal

compensation clients; the designation of such personnel is

subject to the acceptance and approval of [the defendant]."    In

return, the defendant was responsible for the salaries of

certain then-current employees and for case and practice

expenses, and had to pay the plaintiff a monthly amount as "a

nominal fee" for office space and services provided by the

plaintiff.4   The defendant was entitled to all profits generated

     4 The applicable provision of the agreement stated that the
plaintiff would pay "the sum of [e]leven [t]housand ($12,500.00)
[d]ollars per month." The discrepancy is not material to any
issue in this appeal.
                                                                    4

from the OWCP practice that first year.     Beginning in the

agreement's second year, while the plaintiff was to continue

providing space and attorney work to the OWCP practice, all

income from the OWCP practice was to be deposited in an OWCP

practice operating account, from which the plaintiff and the

defendant were to be compensated pursuant to formulas set forth

in the agreement.

    The agreement included a provision regulating the

termination of the parties' arrangement, and the allocation of

accrued expenses, if they decided at any time before March 30,

2017 (i.e., within thirteen months after inception), not to

continue working together.    In the event of such a termination,

and after the allocation of accrued expenses, the defendant was

to retain the OWCP practice, as well as "all practice and case

expenses going forward."   The agreement was otherwise silent on

any termination following March 30, 2017.    Perhaps predictably

enough (if not so predictably as to have been addressed in the

agreement), at some point after March 30, 2017, the parties

developed irreconcilable differences and, in a telephone

conversation between the defendant's attorney and the

plaintiff's managing partner on November 29, 2017, the

defendant's attorney advised the plaintiff that the defendant

wished to "unwind" the parties' relationship, taking his former

staff and clients with him.   Soon thereafter, on or about
                                                                   5

December 6, 2017, the defendant left the plaintiff's office with

all the cases from the OWCP practice.   Importantly for present

purposes, the cases the defendant took with him included more

than eight thousand hours of unbilled work by the plaintiff's

attorneys and paralegals over the approximately twenty months

since the parties had commenced their collaborative arrangement.

     The plaintiff brought claims for breach of contract and the

duty of loyalty, and for quantum meruit, and the defendant

counterclaimed for breach of contract and fiduciary duty.    The

jury found no breach of contract or breach of the duty of

loyalty or fiduciary duty by either party, but awarded the

plaintiff $350,316.75 on its quantum meruit claim.5   After denial

of the defendant's motion for judgment notwithstanding the

verdict and for new trial, judgment entered on the jury verdict,

and this appeal followed.6

     5 Other counterclaims brought by the defendant were resolved
in the plaintiff's favor on motions for summary judgment and for
a directed verdict.

     6 Prior to trial, the defendant moved to dismiss the
plaintiff's claims for damages for want of subject matter
jurisdiction, arguing that, under the Federal Employees'
Compensation Act, any claim for the legal fees at issue "is
valid only if approved by the Secretary [of Labor]," 5 U.S.C.
§ 8127(b), and that the Secretary's decision is "final" and "not
subject to review by . . . a court by mandamus or otherwise." 5
U.S.C. § 8128(b). The Superior Court judge denied the
defendant's motion to dismiss, and the defendant renews his
jurisdictional challenge on appeal. There was no error. The
plaintiff's claims do not implicate any decision by the
Secretary of Labor concerning legal fees. Instead, through its
                                                                       6

    Discussion.   1.     Quantum meruit.   As he argued in his

unsuccessful motion for judgment notwithstanding the verdict and

for new trial, the defendant argues both that the judge should

not have submitted the plaintiff's claim for quantum meruit to

the jury, and that the judge instructed the jury erroneously on

how to consider the claim.

    a.   Submission of quantum meruit claim to the jury.         The

defendant's contention that the plaintiff's quantum meruit claim

was legally precluded relies on the general rule that "[a]

plaintiff is not entitled to recovery on a theory of quantum

meruit where there is a valid contract that defines the

obligations of the parties."    Boston Med. Ctr. Corp. v.

Secretary of the Executive Office of Health & Human Servs., 463

Mass. 447, 467 (2012).    See Restatement (Third) of Restitution

and Unjust Enrichment § 2(2) (2011) ("A valid contract defines

the obligations of the parties as to matters within its scope,

displacing to that extent any inquiry into unjust enrichment").

Because the relationship of the parties in the present case was

defined by a fully integrated written contract, the defendant

claim for quantum meruit, the plaintiff sought to recover the
value of services it performed for the defendant's benefit, a
claim plainly within the jurisdiction of the Superior Court.
See, e.g., G4S Tech. LLC v. Massachusetts Tech. Park Corp., 479
Mass. 721, 722 (2018); Liss v. Studeny, 450 Mass. 473, 473-474
(2008).
                                                                   7

asserts that no recovery under an equitable quasi contract

theory is available.

     The general rule, however, is not without exception.     In

particular, comment c to § 2 of the Restatement (Third) of

Restitution and Unjust Enrichment explains that "[r]estitution

claims of great practical significance arise in a contractual

context . . . when a valuable performance has been rendered

under a contract that is . . . ineffective to regulate the

parties' obligations.   Applied to any such circumstance, the

statement that there can be no unjust enrichment in contract

cases is plainly erroneous."7

     As we have observed, the agreement was glaringly silent

concerning the allocation of accrued revenues and expenses in

the event of any dissolution of the parties' arrangement after

the completion of the first year but before the defendant's

retirement during or after the third year.8   Though the parties

acknowledged that the agreement was an integrated contract

     7 A claim in quantum meruit is closely related to a claim
for unjust enrichment: "[t]he underlying basis for awarding
quantum meruit damages in a quasi-contract case is unjust
enrichment of one party and unjust detriment to the other
party." Salamon v. Terra, 394 Mass. 857, 859 (1985).

     8 The agreement did include provisions regarding expenses
and revenues, but those provisions assumed that the parties
would continue to work together, and that the OWCP practice
would stay with the plaintiff when the defendant retired.
                                                                   8

"pertaining to the subject matter contained herein,"9 that

summary statement does not supply contractual regulation of the

circumstances giving rise to the parties' current dispute.

     In the light of the duties imposed on the plaintiff to

provide office space and attorney work, as well as evidence

presented at trial about the work that the plaintiff's attorneys

actually performed for the defendant's benefit, it was not error

for the judge to conclude that it was appropriate for the jury

to consider the plaintiff's claim for equitable recovery,

through quantum meruit in the absence of a contractual provision

addressing those circumstances.   Cf. Zabin v. Picciotto, 73

Mass. App. Ct. 141, 151 (2008) (where attorney's contingency fee

agreement is terminated, attorney may recover fees under theory

of quantum meruit).

     b.   Jury instructions.   The defendant contends that the

judge's instructions to the jury on the plaintiff's quantum

meruit claim were incorrect in two respects.   First, the

defendant asserts that the judge mischaracterized the agreement

to suggest that it was not an integrated contract.   Second, the

defendant contends that the judge failed to instruct the jury

     9 The agreement contained an integration clause which
confirmed that it "constitutes the entire agreement among the
parties pertaining to the subject matter contained herein and
supersedes all prior agreements, representations and
understandings of the parties."
                                                                      9

that, to establish entitlement to damages in quantum meruit, the

plaintiff was required to prove that it conferred a benefit on

the defendant.    We are not persuaded.

     A trial judge has wide discretion in framing the language

of jury instructions.    See Kiely v. Teradyne, Inc., 85 Mass.

App. Ct. 431, 441 (2014).    Additionally, a judge "is not

required to use exact language 'so long as all necessary

instructions are given in adequate words.'"     Commonwealth v.

Stewart, 460 Mass. 817, 824 (2011), quoting Commonwealth v.

Marrero, 427 Mass. 65, 72 (1998).     "We 'evaluate the charge as a

whole, looking for what meaning a reasonable juror could put to

the words of the trial judge.'"     Stewart, supra, quoting

Commonwealth v. Waite, 422 Mass. 792, 804 (1996).

     First, as we have explained in the preceding section,

though the agreement stated that it was integrated, it was

silent on the circumstances giving rise to the parties' dispute.

It accordingly was not error for the judge to instruct the jury

that the agreement did not address the parties' obligations as

they related to the plaintiff's claim for damages in quantum

meruit.10   In any event, the jury heard repeatedly from the

     10   The judge instructed the jury as follows:

     "I instruct you as a matter of law that the employment and
     purchase of practice agreement, which was admitted as
     [e]xhibit 1, does not cover the dispute in question here.
     Specifically, in the event the relationship between [the
                                                                   10

parties, and the judge reiterated in his instructions,11 that the

agreement was integrated, so the defendant's argument is

misplaced as a matter of fact.

     Regarding the required elements of the plaintiff's claim

for quantum meruit, the judge instructed the jury that the

plaintiff needed to show that (1) it "provided services to [the

defendant]"; (2) "with a reasonable expectation of being paid by

[the defendant]"; (3) "[the defendant] had reason to believe

that [the plaintiff] expected to be paid"; and (4) "[the

defendant] permitted [the plaintiff] to act without stopping

their work or otherwise objecting to [the plaintiff] expecting

to be paid."

     The defendant fixes on the absence of the word "benefit" in

the above elements, but viewing the judge's instructions as a

whole, we perceive no error.   Immediately before laying out the

elements, the judge defined the claim of quantum meruit as "the

concept that no one who benefits by the labor or materials of

     plaintiff] and [the defendant] terminates and [the
     defendant] takes the OWCP practice with him after the first
     year of the agreement, the agreement does not address
     whether [the defendant] must pay anything to [the
     plaintiff] for the services [the plaintiff's] lawyers
     provided to [the defendant] or his clients."

     11The judge explained that the agreement was "fully
integrated" but that, "[t]o the extent a fully integrated
agreement does not address a particular issue or situation, you
may be required, as I will instruct you below, to prevent the
unjust enrichment of one party or the other."
                                                                      11

another should be unjustly enriched" (emphasis added).     With

this context, the jury would have understood from the judge's

instruction that it was their charge to find whether the

plaintiff conferred a measurable benefit on the defendant.      The

charge then required the plaintiff to establish, among other

things, that it "provided services to" the defendant, "with a

reasonable expectation of being paid."    In context, the charge

properly conveyed the elements of the claim, and the jury heard

testimony and saw time reports about the amount of work the

plaintiff's attorneys performed in support of the OWCP practice,

as well as evidence of the billing rate charged for the attorney

hours provided for the OWCP practice.    See General Dynamics

Corp. v. Federal Pac. Elec. Co., 20 Mass. App. Ct. 677, 683

(1985) (jury could award damages where, among other things, they

could have found or fairly inferred that plaintiff agreed to

provide materials or services).

     2.   Evidentiary issues.   The defendant's claims of error in

certain evidentiary rulings by the judge require only brief

discussion.12   We "do not disturb a judge's decision to admit

     12We need not address the defendant's argument that the
judge erred in excluding evidence of his damages, as the jury's
conclusion that the plaintiff did not commit a breach of the
agreement rendered that evidence immaterial. See Karen Constr.
Co. v. Lizotte, 396 Mass. 143, 147 (1985).
                                                                 12

evidence absent an abuse of discretion or other legal error."

Zucco v. Kane, 439 Mass. 503, 507 (2003).

     a.   Evidence of settlement discussions.   The defendant

first contends that the plaintiff should not have been allowed

to introduce evidence of a conversation between its managing

partner and the defendant's attorney, in which the defendant's

attorney advised the plaintiff of the defendant's desire to

"unwind" their business relationship.13   Contrary to the

defendant's contention, the testimony did not constitute

evidence of settlement discussions, and was properly admitted.14

     The testimony on which the defendant bases his challenge

provided background context for the parties' actions as they

began to unwind their relationship.   Additionally, the

     13The plaintiff's managing partner testified that the
conversation with the defendant's attorney went as follows:

     "[The defendant's attorney] said, 'No, [the defendant]
     wants to leave with his people and take all the cases and
     everything with him.' And I said, 'Well, I think that's
     fine as long as, you know, we get paid something fair for
     our time.' I didn't really have a number in mind or even a
     thought about it. And [the defendant's attorney] said,
     'That sounds reasonable to me.' . . . And from then on it
     was just trying to work out the details."

     14Evidence of settlement discussions is not admissible to
"prove or disprove the validity or amount of a disputed claim."
Mass. G. Evid. § 408(a) (2023). Such evidence may be admitted,
however, if "it 'is relevant for some other purpose' than
proving or disproving the amount or validity of a claim."
Filbey v. Carr, 98 Mass. App. Ct. 455, 461 (2020), quoting Dahms
v. Cognex Corp., 455 Mass. 190, 198-199 (2009). See Mass. G.
Evid. § 408(b) (2023).
                                                                   13

conversation took place before any claim was made by either

party or any litigation loomed on the horizon.    It merely showed

how the parties' business relationship ended, without any

discussion of liability or damages.    See, e.g., Slive & Hanna,

Inc. v. Massachusetts Comm'n Against Discrimination, 100 Mass.

App. Ct. 432, 442 n.19 (2021) (statements admissible where they

were relevant to claim that did not exist when statements were

made).

    b.     Time and billing records.   To support its quantum

meruit claim, the plaintiff introduced time records of three

attorneys who worked for the OWCP practice.    At trial, the

defendant objected to the evidence on the basis of inadequate

foundation, contending that the witness through whom the records

were introduced had inadequate understanding of the billing

software through which the time records were entered, stored,

and reported.   We discern no abuse of discretion in the judge's

ruling that the plaintiff's managing partner was competent to

describe how the firm's time records were maintained.     See Mass.

G. Evid. § 901(a) (2023) (authentication satisfied where

proponent "produce[s] evidence sufficient to support a finding

that the item is what the proponent claims it is").     The

managing partner also testified to the manner in which the

records were created, using the plaintiff's billing software

program.    This testimony, along with the testimony describing
                                                                  14

and authenticating the records, laid a sufficient foundation for

the introduction of the evidence; the omission of additional

information, such as custody of the records, went to the weight,

not the admissibility, of the evidence.15    There was no error in

admitting the time records.16

     3.   Motion for judgment notwithstanding the verdict and for

new trial.   Following the jury's verdict, the defendant moved

unsuccessfully for judgment notwithstanding the verdict and for

new trial on the ground that, among other things, the verdict

was against the weight of the evidence.     A judge may set aside a

verdict as against the weight of the evidence only when, drawing

all inferences in favor of the nonmoving party, the judge

determines that "the jury 'failed to exercise an honest and

reasonable judgment in accordance with the controlling

principles of law.'"   O'Brien v. Pearson, 449 Mass. 377, 384

(2007), quoting Robertson v. Gaston Snow & Ely Bartlett, 404

     15To the extent the defendant separately asserts, for the
first time on appeal, that the records were inadmissible
hearsay, we note that the defendant's argument devolves to a
challenge to the judge's finding that the evidence met the
foundational requirements for admission as a business record.

     16The defendant's argument that the time records were
"unethically obtained" is unavailing. See Commonwealth v.
Clerk-Magistrate of the W. Roxbury Div. of the Dist. Court, 439
Mass. 352, 361 n.7 (2003) ("Arguments relegated to a footnote do
not rise to the level of appellate argument"). It fails in any
event, since the time records were business records of the
plaintiff, not confidential client information the plaintiff was
prohibited from disclosing.
                                                                  15

Mass. 515, 520, cert. denied, 493 U.S. 894 (1989).   We review

the defendant's claim of error for an abuse of discretion.      See

O'Brien, supra.

     Assuming (without deciding) that the defendant is correct

in his contention that the agreement required the plaintiff to

designate an attorney to devote one hundred percent of the

attorney's professional time to the OWCP practice,17 the evidence

at trial was sufficient to establish that three different

attorneys were designated to support the defendant's OWCP

practice at various times and were prepared to devote one

hundred percent of their time to the practice.   Though the

defendant approved each designation, he thereafter refused to

work with each of the three.   The evidence was sufficient to

support the jury's conclusion that the plaintiff did not commit

a breach of the agreement by failing to designate an attorney to

devote one hundred percent of their time to the OWCP practice,

and we discern no abuse of discretion by the trial judge in

denying the defendant's motion to set aside the verdict.

                                    Judgment affirmed.

     17As the plaintiff observes, the relevant provision of the
agreement stated that "[i]t is contemplated that sometime prior
to the expiration of [y]ear [one], [the plaintiff] will
designate an attorney to devote [one hundred percent] of his/her
professional time to the OWCP Practice" (emphasis added).