Hyannis Anglers Club, Inc. v. Harris Warren Commercial Kitchens, LLC

91 Mass.App.Ct. 555

78 N.E.3d 784

HYANNIS ANGLERS CLUB, INC., & others¹

v.HARRIS WARREN COMMERCIAL KITCHENS, LLC² (and a consolidated case³ ).

No. 16-P-34

Appeals Court of Massachusetts, Barnstable..

Argued October 14, 2016.

Decided May 23, 2017.

Stephen Soule & Clyde K. Hanyen, Jr., South Easton, for Hyannis Anglers Club, Inc., & another.

John J. Lang, Lynnfield, for Harris Warren Commercial Kitchens, LLC.

Present: Vuono, Massing, & Sacks, JJ.

VUONO, J.

Shortly after 5:00 A.M . on August 27, 2010, a fire erupted in the kitchen of a restaurant in Hyannis owned by Oceans Harbors, LLC (Harbors). The blaze originated in a "Pitco Frialator" (fryer),⁴ a cooking appliance, which, some twelve hours earlier, had purportedly been repaired by a technician employed by Harris Warren Commercial Kitchens, LLC (Harris), a firm engaged in repairing commercial kitchen equipment. The restaurant operated on the first floor of a two-story building owned by Hyannis Anglers Club, Inc. (Anglers Club). The Anglers Club, Harbors, and their insurer, Certain Underwriters at Lloyd's London (Underwriters), brought this action against Harris seeking damages for the losses caused by the fire and for violations of G. L. c. 93A, §§ 2 and 11.⁵

Following a trial in the Superior Court, a jury found that Harris was negligent, and the plaintiffs were awarded $686,496.44, exclusive of costs and statutory interest.⁶ Thereafter, the trial judge, who had reserved for himself the plaintiffs' claim under c. 93A, entered findings, rulings, and an order in which he concluded that Harris had violated c. 93A when its employee, for whom Harris was vicariously liable, disabled a safety switch on the fryer, concealed this fact from Harbors, and falsified the associated work documentation in violation of the Attorney General's rules and regulations regarding repairs and services, 940 Code Mass. Regs. § 3.08(1)(e) (1993). The judge ruled that this deceptive conduct "caused the fire that damaged plaintiffs' businesses and property." However, the judge declined to find, as the plaintiffs alleged, that Harris had wilfully or knowingly violated c. 93A, a ruling that foreclosed an award of multiple damages. Because the plaintiffs prevailed on their c. 93A claim, the judge awarded attorney's fees and costs. The award for one attorney's services was substantially less than the amount sought by the plaintiffs, as the judge computed that award using a contingency fee agreement, rather than the lodestar method.

The parties filed cross appeals from the judgment on the c. 93A claim. The plaintiffs contend that the judge erred in declining to award multiple damages and abused his discretion by declining to award the full amount of attorney's fees they requested. Harris contends that the plaintiffs' complaint did not provide adequate notice of the alleged c. 93A violation and the judge erred by concluding that the conduct of Harris's employee was the proximate cause of the plaintiffs' injuries. For the reasons that follow, we affirm the judgment in part, reverse it in part, and remand the case for further proceedings.

Background. The trial judge accepted the jury's finding of negligence and the award of damages. Based on the evidence presented at trial and the reasonable inferences therefrom, he found the following subsidiary facts. On August 25, 2010, Harris dispatched its employee, James White, to repair a convection oven at Harbors's restaurant. While White was on site, Harbors's day chef asked him to take a look at the fryer. The fryer had been shutting down while in operation, which caused the cooking oil in the fryer to cool and required the pilot light to be relit.⁷ White concluded that the fryer needed a new high limit switch. He ordered that part and an igniter for the convection oven to be delivered overnight to Harris's office.⁸ The next day (August 26), White returned to the restaurant with the parts that he had ordered. White installed an igniter in the convection oven, but he did not install the new high limit switch in the fryer. Instead, as the judge found, White left the restaurant without finishing his work "for his own convenience and personal benefit."⁹ Before he left the kitchen, White informed the day chef that repairs had been made to both the oven and the fryer, and White handed the chef a work order. White's work order provided in pertinent part: "Install Hi–Limit + re-wire to unit—check operating temps OK."¹⁰

Later that evening, at approximately 9:30 P.M. , the fryer overheated and belched smoke. By turning the fryer's control knobs back and forth, Harbors's night chef was able to stop the overheating. The fryer promptly cooled down and remained so until at least 1:30 A.M. , when Harbors's manager closed the restaurant and building for the night. The manager checked the fryer before he left the building.¹¹

During the early morning of August 27, a fire alarm system in the building triggered an alert to the Hyannis Fire Department, which promptly responded. The fire was ultimately suppressed. Investigators determined that the fryer had malfunctioned and sparked a blaze. Further testing by experts confirmed that the high limit switch on the fryer was not new, and that the fryer's thermostat had been "hanging up" intermittently in a setting that called for more heat to the burners even though the thermostat had reached the set temperature needed to heat the cooking oil. This condition is called a "runaway thermostat." The purpose of the high limit switch is to shut off the fryer if this condition occurs.

The judge expressly found that White had disabled the fryer's high limit switch. That switch had been working before he arrived at the restaurant on August 25, but did not work after White finished his work on the afternoon of August 26. He further found that White failed to disclose that he had disabled the switch, and that he submitted a work order and invoice that he knew falsely stated that he had fixed the fryer by replacing the high limit switch when he had not done so.

The judge concluded White's unfair and deceptive acts violated c. 93A and "led directly to the fire and consequent damages." As the judge explained, White, by his own admissions regarding his failures and untruthfulness, was negligent and "arguably ... indifferent" toward the consequences of his conduct when he left the job site without finishing his work.¹² The judge further ruled that White violated 940 Code Mass. Regs. § 3.08(1)(e) by representing that he had made repairs that were not made. However, the judge rejected the plaintiffs' contention that, in the circumstances, White's conduct amounted to a wilful or knowing violation of c. 93A.¹³ Consequently, he did not award multiple damages.

Discussion. 1. Harris's appeal. Harris argues, in essence, that the plaintiffs' complaint did not provide adequate notice and identification of the alleged c. 93A violation. In addition, Harris argues that the c. 93A violation alleged by the plaintiffs was not a proximate cause of the plaintiffs' damages. Both arguments lack merit.

a. Chapter 93A violation. The factual allegations of the complaint provide a detailed description of the deceptive conduct of Harris's employee, White. In particular, the complaint describes White's written work order and invoice (i.e., "Installed hi-limit in Pitco fryer"), which (fairly read) deliberately misrepresented that White had "replaced" the fryer's high limit switch when, in fact, a new switch had not been installed. In addition, the complaint stated that the existing high limit switch was "inoperative." The complaint's factual allegations, as a whole, were incorporated by reference into the plaintiffs' c. 93A claim and, in combination, provided more than fair notice to Harris of the precise nature and totality of the plaintiffs' claim. See Halper v. Demeter, 34 Mass.App.Ct. 299, 301–302, 610 N.E.2d 332 (1993). Harris's suggestion that it was unfairly surprised by the plaintiff's c. 93A claim is implausible on this record. Compare Slaney v. Westwood Auto, Inc., 366 Mass. 688, 702, 322 N.E.2d 768 (1975) (plaintiff "alleged a failure to fulfil warranty obligations ... and ... such failure gives rise to a § 9 claim for relief").

In addition, even if we were to deem the complaint insufficient, the c. 93A violation was tried by consent. "When issues not raised by the pleadings are tried by express or implied consent of the parties, they shall be treated in all respects as if they had been raised in the pleadings." Allen v. Allen, 86 Mass.App.Ct. 295, 304, 16 N.E.3d 1078 (2014), quoting from Mass.R.Civ.P. 15(b), 365 Mass. 761 (1974).

b. Proximate cause. We are similarly unpersuaded by Harris's claim that there was no causal relationship between White's fraudulent misrepresentation and the fire. See Casavant v. Norwegian Cruise Line Ltd., 460 Mass. 500, 503, 952 N.E.2d 908 (2011) (award of damages under c. 93A requires causal connection between deceptive act and injury or loss). It suffices to note that the judge found that Harbors's employees relied upon White's false assurances which, in turn, caused them "to act differently than they would have acted ... with respect to the continued operation of the Pitco Frialator if they had known the truth—the Pitco Frialator had not been repaired and the high limit switch had been disabled." This finding is not clearly erroneous, as Harris claims. To the contrary, the conclusion that White's conduct—which indisputably led the kitchen staff to believe that the fryer had been repaired—directly caused the fire is fully supported by the evidence, which included the chef's testimony that he began to use the fryer immediately after White gave him the invoice and left the premises.¹⁴

2. Plaintiffs' appeal. a. Wilful or knowing violation of c. 93A. We now turn to the plaintiffs' argument that the judge erred in finding that White's deceptive conduct, imputed to Harris, did not amount to a wilful or knowing violation of G. L. c....