$1.85 Million Verdict Upheld Against Demoulas In-Law In Back Bay Condo Squeeze Out

by Rich Vetstein on January 8, 2015 · 6 comments

in Condominium Law, Massachusetts Real Estate Law, Real Estate Litigation

1__1263399571_0444-300x199One of Largest Verdicts In A Condominium Dispute

In a David vs. Goliath case pitting a Demoulas family heir against an elderly Brandeis professor over a tony Back Bay townhouse, the Appeals Court has let stand a $1.85 Million jury verdict — one of the largest awards in a private condominium governance dispute. The case is also one of the first to successfully employ the Massachusetts Civil Rights Act in a private real estate dispute. With interest and an award attorneys fees of $1.9 Million, the judgment will swell close to $4 Million — providing a cautionary tale to condominium trustees who abuse their power for ulterior purposes. The case is Kettenbach v. Wodinsky, Mass. Appeals Court (Jan. 6, 2015), embedded below.

A Classic David vs. Goliath Tale

In 1996, Michael and Frances (Demoulas) Kettenbach bought a unit in the 5 unit townhouse located at 303 Commonwealth Avenue in the Back Bay. (Frances is the sister of Arthur T. Demoulas who was recently reinstated as CEO of Market Basket after a publicized family fight). With the goal to acquire all of the units and convert the building to a grand single family Back Bay residence, Kettenbach purchased three more units, leaving only the top floor unit owned by Jerome and Bernadette Wodinsky. The Wodinskys, who had owned their the fourth floor unit for over 30 years, didn’t want to sell.

According to the court’s ruling, Kettenbach enlisted Gary Crossen, a former prominent Boston attorney who was the Demoulas family’s trial lawyer in their epic family litigation in the 1990’s. When the Wodinsky’s made it clear they were not selling, Kettenbach and Crossen began to put the proverbial “squeeze” on them. Armed with the controlling interest in the condominium association, they summoned state inspectors to condemn the building elevator, leaving the 82 year old Wodinsky, who suffers emphysema, to make the daily climb up 86 stairs to his fourth floor unit. Instead of repairing the elevator, Kettenbach voted to replace it at a $275,000 price tag. When the roof leaked, rather than repair it, Kettenbach insisted on installing a new one – even though it was only 10 years old. He also completely replaced the building’s heating system and did a massive overhaul of the electrical system. The result was a $1 million special assessment, 20% of which Kettenbach attempted to impose on Wodinskys. Kettenbach also hired a private investigator who showed up at Mrs. Wodinsky’s workplace and threatened her with bankruptcy.

Staggering Jury Verdict

Not backing down, the Wodinskys sued, asserting claims under the little used Massachusetts Civil Rights Act, abuse of process, civil conspiracy, and the Consumer Protection Act, Chapter 93A. They won an early victory when a trial judge issued an injunction forcing Kettenbach to fix the elevator. The case went to trial in 2011 over 19 days, and the jury returned a whopping $1.85 Million verdict in the Wodinsky’s favor. Although the trial judge vacated the judgment on the Chapter 93A count, which would have given the Wodinsky’s triple damages, he left the judgment intact on all other claims. Both parties appealed.

Jury Verdict Upheld on Appeal

On appeal, Appeals Court Justice William Meade upheld the entire jury verdict and judgment, and awarded the Wodinsky’s their appellate attorneys’ fees and costs, which will balloon the judgment against Kettenbach to well over $4 Million and change. The justice held that there was ample evidence that:

Kettenbach and Crossen coerced, intimidated, and threatened the Wodinskys in an effort to force them out of their home. This evidence includes: the Kettenbachs’ active attempts to condemn and decommission the building’s only elevator; the excessive period of time during which the elevator was unusable, which forced the elderly Wodinskys to walk up and down four flights of stairs; Crossen and the Kettenbachs’ manipulation of the board’s voting process to the Wodinskys’ detriment; the Kettenbachs’ demand that the Wodinskys pay twenty percent of expensive, unneeded projects that were not lawfully voted upon by the board; the Kettenbachs’ instituting litigation against the Wodinskys to collect such payments while simultaneously forgiving the assessments of another owner who agreed to sell her unit; and the Kettenbachs’ hiring of a private investigator to visit Bernadette at her work place for the specific purpose of threatening the Wodinskys with bankruptcy.

Since a member of the Demoulas family is involved, you can bet that this case isn’t over yet, and that he will try to get the Supreme Judicial Court to hear this case. And he might be successful as this is a huge jury verdict and, as mentioned earlier, one of the largest involving the Massachusetts Civil Rights Act.

Expansion of Condominium Trustee Liability?

Although this was a particularly unique and egregious case, this ruling could be used to expand liability against condominium trustees to for state civil rights violations arising out of contentious governance and assessment disputes. I’m not so sure that the Mass. Civil Rights Act is the appropriate vehicle to address this sort of private claim, because I don’t see how it invokes traditional constitutional rights which the Act was intended to protect. The SJC will have to sort this out but if they don’t take this case, this ruling will be the law of the land. Either way, I will bet that we haven’t heard the end of this dispute.

Kettenbach v. Wodinsky

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  • Eduardo Valadares

    Hi there,

    I don’t know how to begin with. I am disoriented, financially bad situation and unfortunate situation happens. My unit condo catch on fire and for my desperation I have no insurance ( even when I see on my mortgage statement monthly escrow account ( Insurance and taxes ) make me believe, my apartment have insurance. The broker when sold me my condo, keep telling me the unit has ” master insurance ” but not clarify what is the limitation and what means ” master insurance ” and what covers. The president of condo association which also is the owner of maintenance company who does the business with the condo association, denied me any information regarding the master insurance. Also maintenance company was working on my unit condo to fix my apartment without building permit, the manager denied any information about the scope of the service, what is the cost of the service. I know I need a lawyer but I cannot afford one due to a lost of job. My life is a nightmare, I don’t a place to live and I don’t know where to go. Anybody willing to help, I grateful appreciate your kindness for the help in that difficult time. Please email to edu_valadares@live.com

    Sincerely Edu.

  • Sharon

    I read your blog when I was looking up information about condominium law and trustees. I have heard from other condominium owners regarding the abuse and self serving practices of “trustees”. People are literally captives in their own homes, subject to abuses by trustees but short of having to go to court, find no remedy. The condominium community becomes divided amongst those who are either afraid of retribution by trustees, or who, for a variety of reasons, are not familiar with their rights or just go along to get along even when their condo fees are inappropriately used. Many are afraid to speak up for fear of not knowing who is “in with the trustees” and again, fear of retribution. Services are denied, fines are assessed, people stay within their homes and/or only travel to and from their unit to their vehicle. Many “don’t get involved” or speak up until or unless they become of “victim” and then, lack an understanding of their rights under the bylaws, mindlessly except the trustees’ interpretation of what their rights are. The trustees take the position that they are unilaterally exempt from individual liability and “rule” with impunity. Litigation for most is financially prohibitive and confusing and there doesn’t seem to be any available means of legal redress through state law.

    • R

      Who can talk to when our rights as condo owners are abused?
      Why isn’t there a state/city office
      that can advise and help when we are robbed by the trustees?

  • kyle

    I like your blog, based on the story their behavior is disturbing to me, almost seems like criminal charges should be handed down too

  • Adam Adamname

    So in your sick and weird sense of logic the landlord should keep providing tenant services to the only stubborn tenant who opted not to leave the building and happened to live on the top floor. It looks half way convincing when half the story is told. Watch, the
    Wodinskys will take the $4M and decide they don’t want to stay after
    all. You are a genius! More like a Dick Vetstein.
    Boston is such a cesspool!

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