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A Primer: Economic Loss Doctrine Not Necessarily Bar to Tort Recovery

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Written by: Anthony L. DeProspo

Although the “economic loss doctrine” has historically barred recovery of certain classes of tort damages, the Massachusetts Supreme Judicial Court recently affirmed an Appeals Court decision holding that the doctrine did not bar a condominium association’s negligent construction claim against a developer for alleged faulty construction.  The Court’s ruling in Wyman v. Ayer Properties. LLC, SJC-11474 (July 19, 2014), based almost entirely on equitable principles, represents a potentially significant shift away from generally recognized principles of tort recovery.

Massachusetts Registered Land - A Primer

Land Deed

Written by: Andrew Royce

Many out-of-state attorneys and real estate professionals are unfamiliar with the existence of registered land in Massachusetts.  Approximately 15 to 20% of Massachusetts land is registered, meaning that title is certified by the Commonwealth, the description of the land and a list of all encumbrances is found on a certificate of title issued by the Land Court, and documents affecting such land must be filed with the Registry District of the Land Court having jurisdiction over the county (or portion of the county) in which the land is located.  Although registered land systems have existed in several states, they are currently used extensively only in Massachusetts and Minnesota.

2014 Massachusetts Solar Update

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Written by: Bethany A. Bartlett 

SREC II: It seems we hardly knew you

In April of 2014, the Massachusetts Department of Energy Resources (DOER) published amendments to 225 CMR 14.00 creating the next generation of the Solar Carve-Out Renewable policy known as SREC II.  The major differences between the SREC II program and its predecessor was (a) the creation of SREC factors based on four different market sectors, and (b) a declining auction bid price for SRECs over the life of the program.  The Managed Growth sector contains all those projects which do not meet the criteria for the other three sectors (which cover residential, solar canopy, emergency power, community solar, units located on landfills or Brownfields (the definition of which is the subject of a draft DOER guideline) and roof top along with ground mounted units with capacity greater than 25 kW with 67% or more of the output used on-site).  Unless large commercial ground mounted projects (the type of projects that underwent a growth explosion under SREC I) are built on landfills or Brownfields, they would need to qualify under the Managed Growth sector.  SREC II limited the number of these large projects by capping the Managed Growth sector at 26 MW for Compliance Year 2014 and at 80 MW for Compliance Year 2015. 

Purchase Money Security Interests - Value Limited

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Written by: Tracey M. Stockton

During a recent discussion, the topic of purchase money security interests arose and it seemed like a good topic for a quick review.  In Massachusetts, the concept of the purchase money security interest is codified at Article 9 to the UCC, under the heading, “Secured Transactions.”  Let’s briefly look at who is entitled to this type of security interest and, if you have one, what benefit does it provide? 

Buying Standing? Buyer Beware.

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Written by: Thomas P. Gorman 

The doctrine of standing to sue -- the status that allows a plaintiff to bring a lawsuit in the first instance -- is as elusive as it is fundamental.  Courts will dismiss an action unless the plaintiff can show that it has standing.  As the United States Supreme Court has explained, the doctrine of standing ensures that the courts hear only those cases or controversies where the plaintiffs have “alleged such a personal stake in the outcome of the controversy as to assure that concrete adverseness which sharpens the presentation of issues upon which the court so largely depends for illumination….”  Baker v. Carr, 369 U.S. 186, 204 (1962). 


Science Meets Government: MassDEP Moves Forward With Contingency Plan Regulations

MassDEP Contingency Plan

Written by: Ronald W. Ruth and Kevin Hall

Last month, the Massachusetts Department of Environmental Protection (DEP) promulgated several important amendments to the Massachusetts Contingency Plan (MCP), which sets forth the procedures and standards for remediation of environmental contamination. The amendments aim to increase regulatory efficiency while maintaining a high standard of environmental protection by eliminating unnecessary permit requirements, increasing transparency with regards to site closure conditions and updating cleanup standards based on the most recent science.

For example, one amendment addresses the recent change in scientific understanding of the relationship between residual petroleum and future site use. Residual petroleum, a relatively common complication of contamination, is essentially a thin “film” of petroleum existing in a “separate phase” of the surrounding soil and groundwater (think oil and vinegar). In the MCP, this “separate phase” is referred to as a nonaqueous phase liquid (NAPL). The old MCP contemplated a NAPL upper concentration limit (UCL) which required the “film” to be less than ½ inch regardless of NAPL mobility and/or contamination risk.


The Effect of On-line Shopping on Retail Leases and Percentage Rent

Percentage Rent and Retail Leases

Written by: Geoffrey H. Smith

“Percentage Rent” is a familiar concept to retailers and landlords and has long formed a significant aspect of the business arrangement between commercial landlords and their retail tenants.  In a lease arrangement that includes percentage rent, a landlord may negotiate a relatively reduced base rent for the chance to have some “skin in the game” by agreeing to participate in a percentage of tenant’s revenue, through gross sales, when that revenue exceeds a certain threshold amount.  Tenants appreciate this arrangement because they pay percentage rent if they are doing well and their sales exceed that negotiated threshold level. Landlords appreciate this model because it compensates them for the costs they incur in creating and maintaining successful shopping centers with amenities, such as food courts and open spaces.  If a successful shopping center drives foot traffic to individual tenants that increases their sales, tenants are often willing to compensate landlords for their part in driving that foot traffic.  The concept really is a “rising tide lifts all boats” model, in which landlords and tenants work as partners. 

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Five Key Issues for the Parties to a Sublease

Ed Bloom bio

Written by: Edward M. Bloom

A sublease is a transfer of less than a tenant’s full interest in its lease because either it is a transfer of less than all of the tenant’s premises or a transfer of the entire premises for less than the entire term of the tenant’s lease.  Generally, there is no relationship or enforceable rights between the prime landlord and the subtenant because the sublease is basically a lease between the prime tenant and the subtenant whose terms are defined by the provisions of the sublease.  As a result of the legal principles governing (i) the existing lease between prime landlord and prime tenant and (ii) the sublease arrangement between the prime tenant and its subtenant, each party must focus on certain key issues for its protection.


Heating, Ventilation and Air Conditioning (“HVAC”), Solar and Other “Green” Heating Alternatives in Retail Leasing

HVAC for Retail Leases

Written by: Gary D. Buchman

A topic that arises in virtually every retail lease, and yet is barely addressed in the letter of intent (LOI), is the heating and cooling of the demised premises.  The LOI is typically cursory:  “Landlord shall deliver the demised premises to tenant with a 15 TON HVAC system in good working order.”  Who is responsible to maintain and repair the system?  Whose obligation is it to replace the system if it can no longer be repaired?  While these are all business issues, they are most often left for the lawyers to determine during the lease negotiation.  A standard landlord clause would provide:

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Appeals Court Rejects Buyer’s Attempt to Enforce Seller’s Conditional Acceptance

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Written by: Anthony L. DeProspo

The Massachusetts Appeals Court in Host v. Gray recently affirmed a Land Court decision dismissing a buyer’s claim seeking specific performance of his offer to purchase real property.  In March 2010, the seller subdivided her property into three parcels, two of which became known as “Lot 18” and “Lot 19.”  Thereafter, the seller, through a broker, listed Lot 19 for sale.  The buyer viewed Lot 19 in October 2010.  At that time, the seller’s broker advised the buyer that any sale of Lot 19 would require the purchase of some or all of Lot 18 in order to provide access to Lot 19. 

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