Background
In May 2019, Charles Zammuto entered into a purchase and sale agreement (P&S) to buy two adjacent properties in Ashland, Massachusetts from the Damianidis defendants — a pair of real estate trusts — for the purpose of constructing a multi-unit apartment building. Zammuto paid a $35,000 deposit and spent money obtaining special permits and conducting environmental testing. In July 2020, shortly before the scheduled closing, a title insurer discovered that a twelve-foot strip of land essential to Zammuto’s development plan was not actually owned by the defendants. Rather than share the cost to cure the defect through an adverse possession action, the defendants terminated the P&S by invoking provisions allowing termination if clear title could not be delivered within thirty days or without spending more than $3,000.
Zammuto filed suit in the Superior Court in September 2020, seeking specific performance, misrepresentation damages, and relief under G. L. c. 93A (Massachusetts’s consumer protection statute, which authorizes treble damages and attorney’s fees for unfair or deceptive business acts). While the case was pending, the defendants obtained title to the strip through the Land Court in July 2021 and began negotiating to sell the combined properties to a third-party developer, Evolution Developments, LLC. In November 2021, the three parties struck a settlement: Evolution would buy the properties from the defendants, Zammuto’s special permits would transfer to Evolution, and Zammuto would receive $100,000 at closing as a “sellers’ expense.” Both Zammuto and the defendants signed. Evolution’s manager, Carlos Hanzi, did not formally execute the agreement, but his attorney emailed the other parties “Looks good — thanks” and immediately began preparing permit-transfer applications. That same morning, the defendants withdrew from the sale to Evolution entirely.
By early 2022, the litigation had narrowed to Zammuto’s misrepresentation claim; both sides had abandoned their other claims. On the day of the final pretrial conference in January 2024, Zammuto filed a motion to enforce the settlement agreement, seeking a $100,000 judgment. The trial judge denied the motion as “moot,” reasoning that the agreement was contingent on conditions that never occurred (Evolution never closed) and that Zammuto had waited over two years after the breach to seek relief. The judge then held a bench trial and dismissed the misrepresentation claim on the merits. Zammuto appealed both rulings.
The Court’s Holding
The Appeals Court (Singh, Grant & Tan, JJ.) reversed the denial of the motion to enforce and ordered entry of a new $100,000 judgment for Zammuto. Because the motion to enforce should have been granted, the bench trial on the misrepresentation claim would never have occurred; the court vacated the judgment and remanded for entry of a judgment dismissing both parties’ claims with prejudice, as the settlement contemplated.
The court first confirmed that the settlement agreement was a binding contract notwithstanding Hanzi’s failure to formally sign. A contract is formed when parties manifest their intent to be bound, viewed objectively. The email chain showed that all parties, including Hanzi through his attorney’s approval and immediate performance, had assented to all material terms. Execution was treated as a formality, not a condition of obligation. The court also rejected the defendants’ argument that the unfulfilled conditions (the closing with Evolution and completion of preliminary steps by the parties) meant the agreement never took legal effect. Massachusetts distinguishes between conditions precedent to formation and conditions precedent to performance. The language “in the event that items 1-4 above are satisfactorily completed, then at closing . . .” defined when the core payment obligation matured, not whether the contract itself existed.
The court then applied the prevention doctrine: a promisor who hinders or prevents the occurrence of a condition precedent may not invoke the nonoccurrence of that condition as a defense to performance. The defendants’ November 23, 2021 withdrawal from the Evolution transaction was a definite and unequivocal repudiation of the settlement agreement that discharged Zammuto from further obligations and waived any conditions-not-met defense. The laches defense fared no better. Massachusetts does not generally recognize anticipatory repudiation at law, so Zammuto had no enforceable breach-of-contract claim until performance actually came due. The court read the settlement agreement to make the lapse of the special permits — extended by executive order to June 15, 2023 — the implied deadline for performance. Zammuto’s January 2024 filing was not unreasonably delayed, and the lapse of permits neither prejudiced the defendants nor altered their obligations under the settlement.
Key Takeaways
- A settlement agreement reached during litigation is binding once all parties have manifested assent to all material terms, even if one party has not formally signed the document. Conduct and correspondence establishing agreement on terms, and performance consistent with that agreement, are sufficient.
- Conditional language in a settlement agreement — “in the event that X occurs, then Y obligation matures” — typically creates a condition precedent to performance, not a condition precedent to contract formation. The contract exists; only the timing of the obligation is contingent.
- The prevention doctrine bars a party from invoking the nonoccurrence of a condition it caused to fail. A party who repudiates and thereby prevents the condition from occurring cannot later claim the contract was unenforceable because the condition was never met.
- Massachusetts does not generally recognize anticipatory repudiation as a basis for a breach-of-contract action at law. Following a repudiation, the non-breaching party is not required to file suit immediately; the claim accrues when performance was actually due under the contract.
- Recovery for breach of a settlement agreement is the benefit of the bargain — the economic position the plaintiff would have been in had the agreement been performed.
Why It Matters
Zammuto is a useful compendium for litigators handling disputes over settlement agreements that unraveled before all conditions were satisfied. The prevention doctrine point — that a party who repudiates an agreement and thereby prevents its conditions from being fulfilled cannot shelter behind those unmet conditions — is well established in Massachusetts but frequently litigated in real estate and commercial contexts. Sellers, lenders, or other parties who withdraw from a closing should understand that the fact that no closing ever occurred will not automatically insulate them from liability under a settlement agreement that depended on that closing.
The opinion also provides practical guidance on claim timing. Clients who have been repudiated but are waiting for a triggering event (a closing that will not occur, a permit that has not yet lapsed) need not race to the courthouse to preserve their rights, because Massachusetts law does not generally start the breach-of-contract clock on the day of repudiation. Counsel should nevertheless identify the implied or express deadline for performance and calendar it carefully — because the court will find a deadline if the contract does not specify one, and the window for enforcement may be shorter than it appears.