Fitch Law Partners LLPBoston Business Litigation Attorneys | Massachusetts Real Estate Lawyers | Banking2024-03-15T18:46:09Zhttps://www.fitchlp.com/feed/atom/WordPress/wp-content/uploads/sites/1201231/2021/02/favicon.icoby Laura Hennesseyhttps://www.fitchlp.com/?p=567322024-03-15T18:46:09Z2024-03-15T18:46:09ZCFPB, “[t]hese institutions typically charge $35 for an overdraft loan, even though the majority of consumers’ debit card overdrafts are for less than $26, and are repaid within three days.” The proposed rule would apply only to institutions with $10 billion in assets and would offer two alternatives for continuing to offer overdraft protection. First, banks could make overdraft lending services a formal line of credit subject to the rules applicable to credit cards (including disclosing the interest rate). Alternately, banks could continue to offer overdraft protection as a convenience to customers but would be required to charge a much lower fee—either an amount that approximates their costs or a benchmark fee set by the CFPB (the proposed rule is considering $3, $6, $7 or $14).
So far, the CFPB has received at least 120 formal comments on the proposed overdraft rule, many from consumers expressing their emphatic support for the proposal. Banks, credit unions and other financial institutions, on the other hand, have been equally emphatic in their opposition to the proposed regulation. The American Bankers Association (“ABA”) and the Consumer Bankers Association (“CBA”) issued statements in opposition to the rule shortly after it was proposed on January 17. The ABA expressed concern that the proposal “would make it significantly harder for banks to offer overdraft protection to customers, including those who have few, if any, other means to access needed liquidity” and cited data showing that the majority of Americans value access to overdraft protection. The CBA noted that financial institutions had voluntarily reduced overdraft fees by $5 billion between 2019 and 2022, and faulted the CFPB for its “one-size-fits-all approach” that threatens to “feez[e] innovation and competition.” Comments submitted by various credit unions and other financial institutions echo those of the ABA and CBA, highlighting that the proposed rule would jeopardize the ability of banks to continue offering overdraft protection, a service that customers uniformly value and are required to affirmatively opt in to. Commenters also pointed out that overdraft protection allows customers who live paycheck to paycheck to address timing mismatches and access valuable free checking accounts.]]>by Michele Connollyhttps://www.fitchlp.com/?p=567312024-03-15T18:38:47Z2024-03-15T18:34:33ZBoulay v. Boulay is a partition action, involving property owned by a family trust and a dispute between brothers, who were the beneficiaries of the family trust. The brothers – Todd and Chad – began discussions concerning Todd’s purchase of Chad’s beneficial interest in the trust. They exchanged emails discussing the terms of the transfer of interest, which included a $75,000 payment by Todd to Chad. The proposed transaction would involve changing ownership on the deed for the real property, and a dispute arose between the brothers of whose name would appear. Todd claimed that the email exchange constituted an enforceable written agreement.
For a contract to be enforceable, the parties to the contract must agree on the material terms and must have an intent to form an enforceable agreement. Without agreement as to all material terms, there is no enforceable agreement. Further, contracts in Massachusetts involving the sale of real property must comply with the Statute of Frauds, which requires a written, signed agreement.
The Court reiterated the now well-established principle that email exchanges can satisfy the requirements of the Statute of Frauds when the emails memorialize the agreement between the parties. However, where the email exchanges constitute a negotiation that does not result in a meeting of the minds on all material terms, the Statute of Frauds in not satisfied.
The Court found that the brothers had no meeting of the minds on certain material terms, noting that the identity of the individual on the deed when property is transferred constitutes a material term. The Court also found no intent to be bound as a result of Todd’s statements that he would not “sign off” on an agreement until it was reduced to a written agreement drafted by an attorney. The Court concluded that the email exchanges evidenced that the parties were in the stage of imperfect negotiation, which is insufficient to form a binding contractual obligation.]]>by Andrea Knowleshttps://www.fitchlp.com/?p=567272024-02-29T15:44:50Z2024-02-29T15:44:50ZMehra v. Boston Globe Media Partners.]]>by Madeline Pelagallihttps://www.fitchlp.com/?p=567182024-02-23T03:26:22Z2024-02-21T16:39:35Z
During the height of the Covid-19 pandemic, the Probate and Family Court suspended the requirement for all parties in divorces involving children, actions to establish paternity, complaints for modification and contempt involving custody and/or parenting-time, or any other case involving parenting time, custody, or support of minor children, to attend a Parent Education Program. The suspension of this requirement was rescinded by a September 20, 2023 Standing Order of the Probate and Family Court, which required parties in matters filed on or after November 1, 2023 to attend a court-approved parenting course.
On January 22, 2024, the Probate and Family Court revised Standing Order 3-23, which addresses the Court’s authority to order parents to attend a Court approved parenting education course. All parents to a Complaint for Divorce filed pursuant to G. L. c. 208, § 1B, Complaint for Separate Support, Complaint to Establish Paternity, or Complaint for Custody/Support/Parenting Time filed on or after February 12, 2024 must attend a co-parenting education course called “Two Families Now”. A pamphlet describing the course and a Notice to Parents, which describes the requirements of the Standing Order, shall be given to the Plaintiff or their attorney upon the filing of the Complaint, and the Notice to Parents must be served to the other party with the complaint and summons.
Parents must register for the course within 30 days after the service of the Complaint, and the course must be completed 30 days after registering. The Certificate of Completion must be filed within 14 calendar days after the completion of the course. The Court may impose sanctions upon parties who fail to complete the co-parenting course.
Parents should note that Standing Order 3-23 gives judges the authority to order parents involved in post-judgment cases involving custody and/or parenting time issues, such as a Complaint for Modification or Complaint for Contempt, to attend the Course.
“Two Families Now” is a four-hour, online course that parents can complete at their own pace on a computer, tablet, or smart phone. The cost to attend is $49 per parent, unless the Court approves of a parent’s Affidavit of Indigency and Request for Waiver, Substitution or State Payment of Fees and Costs. If a waiver is granted, the approved waiver must be uploaded to the “Two Families Now” two website during registration.
A Court may waive the attendance of one or both parents upon a Motion to Waive Attendance at Parent Education Program, and with proper notice of the Motion being given to the other parent. The Court may decide the request without a hearing, or the Court may schedule an in-person or virtual hearing to hear the Motion. A waiver may be granted if there is a demonstrable showing of actions or patterns of behaviors which makes parental communication unsafe, if there are language barriers between the parties, if a parent is incarcerated or unavailable, if the parties submit a written agreement on custody and/or parenting time issues, or if a parent previously attended the course.
If a parent is not required to attend the co-parenting course under the standing order but wishes to do so, they may voluntarily take the course upon payment of the $49 fee or the approval of an Affidavit of Indigency and Request for Waiver.]]>by Michele Connollyhttps://www.fitchlp.com/?p=567172024-02-21T16:29:47Z2024-02-21T16:29:47ZBoykin v. Genzyme Therapeutic Products, LP, the First Circuit re-affirmed that tripartite framework.
First, a plaintiff must make out a prima facie showing of discrimination. That is, a plaintiff must proffer evidence that would support a finding that the claim is valid.
Second, if a plaintiff meets that threshold, then the burden of production shifts to the defendant, who must show that there was a legitimate, non-discriminatory reason for the adverse employment action.
Finally, if the employer has provided a legitimate, non-discriminatory reason for the adverse employment action, the burden shifts back to the plaintiff, who must show that the employer’s stated reason was pretextual and that, in fact, the real reason for the adverse employment action was improper discrimination. If a plaintiff is unable to show that the legitimate reason offered was a pretext, then the plaintiff’s claim fails.
In Boykin, the plaintiff challenged a lower court’s decision dismissing his claim, arguing (1) that the District Court had failed to analyze the tripartite framework in the proper order, and (2) that the District Court had committed error in finding that plaintiff had failed to establish that the reason proffered by the employer for the adverse employment action was pretextual.
With respect to the first argument, the District Court considered whether the plaintiff had made a prima facie showing of discrimination, but noted that there was a question of whether a negative performance review could constitute the adverse employment action necessary for a claim of discrimination. Because the District Court found that the plaintiff had not established that the employer’s proffered reason was pretextual, the Court found that it did not need to consider the first step. The First Circuit agreed with this approach, finding that there is no requirement that the steps must be considered in order when the first step is uncertain, but the third step clearly shows a plaintiff cannot prevail.
With respect to the second argument, the First Circuit affirmed the District Court’s finding that the plaintiff failed to show that the employer’s reason for the negative performance review was pretextual. The First Circuit found that the argument for discrimination made by the plaintiff might be a possibility, but it was not backed by the kind of definite evidence courts require for a claim to survive summary judgment.]]>by Alessandra Wingerterhttps://www.fitchlp.com/?p=567092024-02-16T16:25:21Z2024-02-16T16:17:20ZMcLaughlin v. Zoning Board of Appeals of Duxbury.
McLaughlin v. Zoning Board of Appeals of Duxbury involved the denial of a special permit for a proposed pier. The lynchpin in this case was determining the edge of a salt marsh. The local bylaw required that any pier “must extend the full distance over any salt marsh used to access the water’s edge.” The proposed pier, as shown on the plans, would extend over a grassy, vegetated area of a salt marsh. A float at the end of the pier would rest in the water, at least during high tide. Because the pier would reach the water after crossing over the marshy, grassy area, the applicant argued that the proposed pier met this bylaw’s requirement. The ZBA, however, maintained that even though the pier would reach the water, the inlet where the float would rest is considered part of the salt marsh and denied the application for special permit. Both parties relied on wetlands experts to support their arguments.
When the denial of the special permit was appealed, the Land Court heard testimony from three experts – the engineer who designed the pier, a wetland scientist who testified on behalf of the applicant, and a wetland scientist who testified on behalf of the ZBA. Expert testimony featured heavily in the case, because a number of key terms, like “salt marsh,” “tidal flat” and “tidal creek” were either poorly defined or not defined at all. Further, the resource maps and plans were outdated and unreliable. In deciding whose testimony to credit, the Land Court gave much weight to the fact that the applicant’s two experts “inspected the property multiple times” and verified their information with “onsite inspections,” unlike the ZBA’s expert “who had not made a site visit.” The Appeals Court upheld the Land Court’s crediting of the applicant’s experts and not that of the ZBA’s expert.
As McLaughlin v. Zoning Board of Appeals of Duxbury demonstrates, maps and regulations are becoming more and more outdated with a changing landscape. Consequently, site visits are likely to become increasingly important for ground-truthing and rendering an opinion – and, in turn, increasingly important for a party’s expert’s credibility before a decision-making body.]]>by Ryan Cunninghamhttps://www.fitchlp.com/?p=567062024-02-16T15:58:24Z2024-02-16T15:58:24ZDepartment of Agricultural Rural Development Rural Housing Service v. Kirtz.
Kirtz sued the Rural Housing Service, a division of the United States Department of Agriculture (USDA), for failing to conduct a good-faith investigation into allegedly inaccurate information it had reported to credit reporting agency TransUnion regarding a loan it made to Kirtz. The USDA argued that sovereign immunity barred the claim, and the United States District Court agreed. On appeal, while acknowledging a circuit split on the issue, the Third Circuit found that the FCRA explicitly waived sovereign immunity by imposing liability on any “person,” the definition for which includes “any…government or governmental subdivision or agency.”
At the Supreme Court, the USDA argued that application of the definition of person to it would lead to absurd outcomes, potentially exposing government agencies to criminal prosecution under Section 1681q. The Justices, however, noted that any such absurdity can be corrected by the Court without distorting other provisions of the statute. Where the statutory language in Section 1681a of the FCRA defines a “person” to include any government or governmental subdivision or agency, that definition includes the USDA, and sovereign immunity is waived as to suits against government agencies by individuals under Sections 1681n and 1681o.
For more information about our banking litigation practice, please visit our banking litigation page.]]>by Nathalie Salomonhttps://www.fitchlp.com/?p=566232024-01-30T19:38:55Z2024-01-30T19:30:06ZTrustees of Boston College v. NCDS of the Sacred Heart, Inc., the Appeals Court addressed each of these questions and provided a comprehensive overview of principles and doctrines commonly invoked by parties in connection with their claims to rights in a way that abuts their property. The case involved the dispute between two schools, Boston College (“BC”) and Boston Academy of the Sacred Heart, which operates Newton Country Day School, (“NCDS”) over property rights in Colby Street, a private road that separates their respective campuses. Both schools acquired their property from the same seller in a joint closing. The deed to BC expressly includes rights to Colby Street whereas the deed to NCDS does not. Although both schools recorded their deed on the same day at the same time, the deed to NCDS appears first, based solely upon the book and page numbers assigned to the two deeds. For nearly fifty years, the parties both used Colby Street without any issue. Tension arose when NCDS planned to build a new athletic facility and sought to use Colby Street for vehicular access to that facility. BC agreed to permit NCDS to use the street, but for emergency access only. In its lawsuit against NCDS, BC maintained that NCDS’s use of Colby Street was not, in fact, limited to emergencies. NCDS also filed suit, seeking a declaration from the Court that it owned half of Colby Street, up to the center line or that it had acquired an easement to use the street. The Land Court entered judgment in favor of BC, holding that the order in which the deeds were recorded was inconsequential and, based upon the plain language of its deed, BC owned all of the street and NCDS had no right to use it. NCDS appealed.
On appeal, NCDS disputed BC’s assertions that it owned all of the rights to Colby Street and NCDS had no right to use it. Invoking the Derelict Fee Statute, G.L. c. 183, § 58, NCDS alleged that it had a fee interest in Colby Street. In the alternative, it alleged that it had an easement right based on two different theories: estoppel and implication. As discussed below, the Appeals Court disagreed with both of NCDS’s arguments and ruled in favor of BC.
The Derelict Fee Statute
The purpose of the Derelict Fee Statute is to determine ownership rights in a private or public way abutting a property when the deed to the property is silent with respect to rights to the way. It often comes into play when an owner, who owns a large piece of land, subdivides the land into separate lots abutting a way (or street), and conveys a lot without any reference to any interest in the way, while retaining the property on the other side of the way. Under the statute, unless the grantor expressly reserves a right to the way to the property it retains, a fee to the center line of the way is automatically included with the sold lot.
In this case, in contrast to the deed to BC, the deed to NCDS did not contain any recitation of rights in NCDS to Colby Street, a fact that NCDS acknowledged. To overcome that undisputed fact, NCDS argued that, since its deed was recorded first, it had priority over BC’s deed pursuant to the Derelict Fee Statute, on the theory that when the NCDS deed was recorded, the seller/grantor still retained rights to Colby Street. The Appeals Court disagreed.
The effective transfer of title and the simultaneous deeds doctrine
The Court found that the order in which the deeds were recorded was immaterial, because title to real property passes not upon the recording of the deed but the delivery of the deed to the grantee. It noted that the purpose of the recording of a deed is simply to give notice to others who would not otherwise have knowledge of the transaction. In the instant case, the deeds to BC and NCDS were delivered simultaneously in a joint closing. Furthermore, the Court noted, both deeds were included in a closing binder that both parties received prior to the closing. Consequently, NCDS had knowledge that title to Colby Street was being transferred to BC at the same time it acquired the adjacent property, and the Derelict Fee Statute did not apply to the transaction.
Even though its reasoning was dispositive of the issue before it, the Court went on to consider the simultaneous deeds doctrine, which provides that when two deeds are executed, delivered and recorded as part of a single simultaneous transaction, the deeds are deemed to have been recorded simultaneously and there is no priority of one deed over the other. Even though NCDS’s deed appears first in the Registry of Deeds’ records, the Court concluded that they were recorded simultaneously based on the circumstances of the closing.
The Court also rejected NCDS’s argument that it had an implied easement or an easement by estoppel over Colby Street.]]>by Malgorzata Mrozekhttps://www.fitchlp.com/?p=566222024-01-26T16:20:28Z2024-01-26T16:16:09ZGrupo Unidos por el Canal, S.A. v. Autoridad del Canal de Panama, related to the expansion of the Panama Canal. Grupo Unidos is a consortium of European companies contract to design and build a new set of locks for the Panama Canal. After complications and delays, Grupo Unidos did not complete its contractual obligations until almost two years past the deadline. Several arbitrations between Grupo Unidos and the canal authority commenced as a result of the delay.
At issue in this case was the Panama I Arbitration, which involved a three-member arbitral tribunal with the International Court of Arbitration of the International Chamber of Commerce. Prior to the commencement of the arbitration, all three members of the tribunal made disclosures as to potential conflicts. Following five years of arbitration, the tribunal awarded the canal authority almost $240 million dollars in damages. Following the arbitration award, Grupo Unidos requested additional disclosures from the tribunal members, seeking evidence of arbitrator bias. The additional disclosures revealed that: (1) one of the arbitrators nominated another tribunal member to serve as chair in an unrelated arbitration; (2) during the pendency of the Panama I arbitration one of the tribunal members served as co-arbitrator in an unrelated arbitration with one of the canal authority’s attorneys; (3) prior to the Panama I arbitration, another tribunal member served as co-arbitrator on an unrelated arbitration with one of the canal authority’s attorneys; and (4) one of the tribunal members has been serving on a panel in a case in which one of the canal authority’s attorneys represents a party. Grupo Unidos claimed the relations were evidence of bias against them and sought to vacate the award in the United States District Court for the Southern District of Florida.
The District Court declined to vacate the award and confirmed. Grupo Unidos appealed. The Eleventh Circuit affirmed the District Court’s award confirmation, under both the Federal Arbitration Act (“FAA”) and New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards (“New York Convention”). The Eleventh Circuit held that merely serving on the same tribunals, and even nominating a fellow arbitrator as chair, is not sufficient to show evident partiality or corruption among the arbitrators. The Panama I arbitrators were experienced, sought-after neutrals with decades of experience and dozens of cases, with particular expertise in construction arbitration, a niche area. Thus, it is unsurprising the arbitrators may serve on other panels together and know one another professionally – that is not tantamount to bias, the Eleventh Circuit concluded. Additionally, again given the niche legal area, it is also not surprising that counsel may appear before neutrals in more than one case. Again, such familiarity is not tantamount to bias. Thus, the Eleventh Circuit found there were no grounds to vacate the award under either the FAA or New York Convention.]]>by Srish Khakurelhttps://www.fitchlp.com/?p=566162024-01-23T21:00:56Z2024-01-20T19:31:33Zoral arguments in Good v. Uber Technologies, Inc. et al. At issue is whether Uber’s in-app pop-up screen provides to its customers reasonable notice of the terms of use containing, among other things, a binding arbitration clause, and whether this mechanism is sufficient to secure a reasonable manifestation of assent from the customer. At the Trial Court, Uber moved to compel arbitration against a customer who filed suit after suffering serious injuries while using Uber’s services. But the Trial Court denied the motion after finding that the agreement to arbitrate was not enforceable. The sufficiency of notice issue pertains to a smartphone pop-up screen which stated that Uber had updated its terms and encouraged users to read the updated terms, provided hyperlinks to the terms of use and privacy notice, and provided a checkbox for the user to confirm review of and indicate agreement with those terms.
Only three years ago, the SJC had sided against Uber in finding an agreement to arbitrate unenforceable against Uber’s customers, in a slightly different iteration of the issue stemming from Uber’s app registration process. See Kauders et al. v. Uber Technologies, Inc. et al. Applying the analytical framework supplied by that opinion, the Trial Court in Good v. Uber Technologies, Inc. et al. found that the pop-up did not provide reasonable notice to customers regarding the terms of use, including the agreement to arbitrate. “Had [the customer] been required to click on the Terms of Use, and scroll through the terms, the outcome…may be different,” the Trial Court opinion notes. A clickwrap or click-through agreement usually “appears on an internet webpage and requires that a user consent to any terms or conditions by clicking on a dialog box on the screen in order to proceed with the internet transaction.” In contrast, a scrollwrap agreement “requires users to physically scroll through an Internet agreement and click on a separate ‘I agree’ button in order to assent to the terms and conditions of the host website.” The Trial Court found this distinction important because the SJC has “indicated that a scrollwrap agreement provides reasonable notice of the internet contract’s terms and conditions, whereas a clickwrap agreement…only may, depending on the associated language.” As the SJC noted in Kauders, for Internet transactions, “the specifics and subtleties of the ‘design and content of the relevant interface’ are especially relevant.”
While it remains to be seen how the SJC will decide Good, it is likely that scrollwrap agreements provide better protection for companies conducting business in Massachusetts that wish to enter into online contracts with customers. For companies wishing to continue using clickwrap agreements, a nuanced analysis may be needed to ascertain enforceability.]]>