Wessell v. Mink Brook Associates, Inc.

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14-P-1120 Appeals Court
MARY ELLEN WESSELL vs. MINK BROOK ASSOCIATES, INC., & another.1
No. 14-P-1120.
Worcester. April 7, 2015. - August 5, 2015.
Present: Kantrowitz, Kafker, & Hanlon, JJ.
Massachusetts Wage Act. Attorney at Law, Disqualification,
Attorney-client relationship, Conflict of interest.
Employment, Retaliation, Termination. Damages, Wrongful
discharge of employee, Back pay. Practice, Civil,
Instructions to jury, Damages.
Civil action commenced in the Superior Court Department on
June 19, 2012.
A motion to disqualify the plaintiff's attorney was heard
by David Ricciardone, J., and the case was tried before him.
Gregg S. Haladyna for the defendants.
Steven D. Weatherhead (John F. Welsh with him) for the
plaintiff.
KANTROWITZ, J. This case involves a dispute between an
employee and her former employer regarding unpaid wages. The
plaintiff, Mary Ellen Wessell, successfully sued Mink Brook
1
Robert C. Stone.
2
Associates, Inc. (Mink Brook), and owner Robert C. Stone under
the Wage Act for lost wages and retaliatory discharge after
Stone refused to issue her a paycheck, she complained, and she
was fired.
In this appeal, the defendants argue that the trial judge
improperly denied their pretrial motion to disqualify opposing
counsel because Wessell's attorney, who was her long-time
personal friend, had previously provided informal legal advice
to her on certain topics in Wessell's capacity as an employee of
Mink Brook. The defendants also contend that the judge
improperly instructed the jury on compensatory damages on the
retaliation claim. We affirm.
Background.2 Mink Brook was incorporated in 1993 as a
franchisee of Paul Davis Restoration, a national company that
performed restoration work on houses to mitigate damage from
flooding, fire, mold, or other problems. Stone was Mink Brook's
owner and president. In 2007, Stone contacted Wessell to
discuss hiring her to work on the company's financial matters
and record-keeping. She joined Mink Brook in its Worcester
office as a subcontractor at an hourly rate, and in 2008 she
2
Our recitation includes both evidence put before the judge
on the defendants' pretrial motion to disqualify Wessell's
counsel and evidence put before the jury at trial. The latter
we generally present in the light most favorable to Wessell.
Much was undisputed, but where there was a relevant conflict, or
a finding by the judge, we will so note.
3
became the company's "business manager" at an annual salary of
$50,000. Wessell's duties included managing accounts, human
resources, payroll, bookkeeping, insurance policies, vehicle
registration, and licenses. She would occasionally work from
home on a laptop computer that Stone purchased. Wessell also
performed unpaid work duties during her vacations or at times
outside of her business hours. Employees received paychecks
every two weeks. Wessell testified that she worked about fifty
hours per week.3
During Wessell's employment at Mink Brook, she occasionally
sought informal legal advice from a close friend, Attorney John
Welsh, whom she had known for many years.4 In 2008 and 2009,
Wessell consulted with Attorney Welsh on a former employee's
breach of postemployment covenants, and Welsh drafted a cease-
and-desist letter. In 2010, on matters involving another former
employee, Wessell exchanged electronic mail messages (e-mails)
with Welsh, and he reviewed correspondence that Mink Brook sent
3
In April, 2011, Wessell was involved in a car accident,
which required approximately eight weeks of recuperation and
lost work. When Stone protested the lost time, Wessell worked
part-time from home. She was paid at an hourly rate.
4
Attorney Welsh stated in an affidavit that "I have known
Ms. Wessell for over 35 years. She has been my sister's best
friend since grade school." He further stated that "Ms. Wessell
would call me intermittently (once every 12-18 months) for
advice concerning personnel issues she was handling on behalf of
the company."
4
to the Attorney General's office. Sometime in 2010, Welsh
notified Wessell that he would no longer provide legal advice to
Mink Brook.5 However, on June 15, 2011, Wessell again contacted
Welsh, who agreed as a "friend" to provide advice on an issue
involving building access by a Mink Brook job applicant who had
a physical disability.6
Wessell testified that as of late 2011, she observed
numerous problems or irregularities with the company's finances
and operations.7 She informed Stone of some of her observations,
including her belief that an employee was "stealing from him."
Stone said "[b]asically nothing" in response to this
information.
5
Welsh stated in his affidavit that he stopped providing
legal advice to Mink Brook because he found Stone's treatment of
Wessell to be unacceptable. Additionally, he had a billing and
stolen property dispute with Mink Brook regarding work performed
on his home. The defendants dispute receiving notice that
Welsh's legal advice stopped in 2010.
6
The defendants also alleged that Welsh helped Wessell
prepare an employee handbook for Mink Brook.
7
Regarding Mink Brook's finances, Wessell testified that
sales were low and customers were complaining. On at least one
occasion, Wessell had to delay issuing paychecks to herself and
other employees. Wessell testified that Stone charged personal
expenses to company credit cards and used company money to pay
his son large amounts of money for cleaning the bathrooms, to
provide his wife with a salary, to make payments on his home
mortgage, and to purchase several items that were unrelated to
the company's home restoration business.
5
Shortly thereafter, in early January, 2012, Stone called
Wessell into a meeting in which the accused employee was
present. At this meeting, Stone accused Wessell of lying about
her reporting of work hours since her automobile accident (see
note 3, supra). He demanded financial reports that were
impossible for her to provide, and he ultimately demoted her
from business manager, placed the accused employee in that role,
and required Wessell to report to that employee.
On March 28, 2012, during a meeting with several employees
including Wessell, Stone addressed their financial concerns
about Mink Brook and informed them that the company was not
closing but was experiencing "just a little bump in the road."
Stone then named several employees who would still receive their
upcoming paychecks, but he did not name Wessell. When she
inquired about her paycheck, he stated that she would not
receive it. Wessell responded that this was unfair and that she
wanted to meet privately with Stone after the group meeting.
One hour later, Wessell and Stone met privately in her office.
Wessell demanded to be paid, and Stone replied that she "could
afford not to get paid." The next day, March 29, 2012, Wessell
again met with Stone and the accused employee. Stone stated
6
that Wessell was stealing money and reimbursing herself without
authorization, which Wessell denied. Stone then fired her.8
Wessell formally retained Welsh who, on June 19, 2012,
filed the instant complaint against Mink Brook and Stone,
alleging claims of nonpayment of wages and retaliatory firing in
violation of the Wage Act, G. L. c. 149, §§ 148, 148A.9 On
January 2, 2014, nearly one and one-half years after the
litigation began and eleven days before trial, the defendants
filed a motion to disqualify Welsh, claiming a conflict of
interest given Welsh's attorney-client relationship with them.10
One week later the trial judge, after a hearing, denied the
motion. The judge ruled that Welsh's advice to Wessell, given
when she worked for Mink Brook, was informal, free, and
unrelated to the issues in her complaint. The judge concluded
8
Wessell testified that she later received a check for a
portion of the money that Mink Brook owed her for wages.
9
Wessell's complaint stated that she received a right-to-
sue letter from the Attorney General; this letter is not
included in the record appendix, but the defendants raise no
issue on this subject. Wessell's complaint also included a
quantum meruit claim that was eventually dismissed by
stipulation of the parties.
10
The matter of representation by Welsh was apparently
considered by the defendants when they were defaulted in late
2012. Counsel for the defendants told the trial judge on
January 9, 2014, at the hearing on the motion to disqualify,
that the default occurred because Stone considered the complaint
"just an intimidation tactic," and believed that Welsh could not
bring the complaint because of his prior legal assistance to
Mink Brook.
7
that although Welsh's personal relationship with Wessell gave
Mink Brook a "valuable contact," Mink Brook and Welsh never
established an attorney-client relationship.11
On January 14, 2014, the jury found for the plaintiff and
awarded damages for lost wages and unused vacation time, up to
the date of her firing, of $3,750. The jury also awarded lost
compensation from the date of firing up to the date of the
verdict, minus earnings from Wessell's subsequent employment
elsewhere, of $54,880.90. On January 24, 2014, the court
entered an amended judgment that trebled the amount, as required
under G. L. c. 149, § 150,12 and added interest, for an award of
$187,111.38. This appeal followed.13
11
The judge found:
"There's a very de minimis interaction between Ms.
Wessell and Mr. Welsh in terms of some of this informal
advice and education on legal topics such as handicap
accessibility and what to do with a competing former
employee and things of that nature. These contexts to me
arise out of the personal relationship between the two. I
think he was representing Mink Brook in only the most
technical sense, and certainly by going ahead and
representing Ms. Wessell in this case I don't think that
there is any basis for an abuse of confidential information
regarding Mink Brook that he learned in the course of any
of this advice. The advice Mr. Welsh gave on these few
exchanges over the course of several years were on clearly
unrelated matters . . . ."
12
The statute states, in pertinent part, "An employee so
aggrieved who prevails in such an action shall be awarded treble
damages, as liquidated damages, for any lost wages and other
benefits and shall also be awarded the costs of the litigation
8
Motion to disqualify. Denial of a motion to disqualify an
attorney is reviewed for abuse of discretion. Steinert v.
Steinert, 73 Mass. App. Ct. 287, 288 (2008). A moving party
must show, first, that the current representation is adverse to
the interests of the former client, and second that the matters
of the two representations are substantially related. Slade v.
Ormsby, 69 Mass. App. Ct. 542, 546 (2007), citing Adoption of
Erica, 426 Mass. 55, 61 (1997). See Mass.R.Prof.C. 1.9, 426
Mass. 1342 (1998).14
An attorney-client relationship "may be, but need not be,
express; the relationship can be implied from the conduct of the
parties." Page v. Frazier, 388 Mass. 55, 62 (1983). For an
implied attorney-client relationship, (1) a party must seek
advice from an attorney, (2) the advice sought must be within
the attorney's professional competence, and (3) the attorney
and reasonable attorneys' fees." G. L. c. 149, § 150, as
amended by St. 2008, c. 80, § 5.
13
On April 8, 2014, the court further ordered an award of
Wessell's costs and attorney's fees, which together totaled
about $40,000. The defendants did not file an appeal from that
order, and its correctness is not before us.
14
Rule 1.9(a) states, "A lawyer who has formerly
represented a client in a matter shall not thereafter represent
another person in the same or a substantially related matter in
which that person's interests are materially adverse to the
interests of the former client unless the former client consents
after consultation." The Massachusetts Rules of Professional
Conduct "specifically incorporate" the substantial relationship
test. Adoption of Erica, 426 Mass. at 61.
9
agrees to give, or actually gives, the advice. DeVaux v.
American Home Assur. Co., 387 Mass. 814, 818 (1983).
Additionally, "the question whether there was an attorney-client
relationship depends on the reasonableness of the [complaining
party's] reliance." Id. at 819.
For matters to be "substantially related," courts have
consistently found that counsel must possess confidential
information that could be used against the former client in the
current representation. See Masiello v. Perini Corp., 394 Mass.
842, 847-850 (1985); Adoption of Erica, 426 Mass. at 63.15 When
determining whether matters are substantially related, a judge
should make a factual determination by comparing "the overlap
and similarity" between the former and current representations.
Slade v. Ormsby, 69 Mass. App. Ct. at 547.16
Courts discourage "eleventh hour maneuvers" to disqualify
opposing counsel where the moving party has advance notice of
the representation by opposing counsel but waits to raise the
issue until the eve of trial. Masiello v. Perini Corp., 394
Mass. at 850. Such tactics "are disruptive to the efficient
15
One can envision a scenario where matters are
substantially related despite a lack of confidential
information. Such is not the case here.
16
"[T]he exact parameters" of when two matters are
substantially related has not been delineated in the case law.
Slade v. Ormsby, 69 Mass. App. Ct. at 547 n.11, citing Adoption
of Erica, 426 Mass. at 62.
10
administration of justice and are costly." Ibid. "Court
resources are sorely taxed by the . . . use of disqualification
motions as harassment and dilatory tactics." Gorovitz v.
Planning Bd. of Nantucket, 394 Mass. 246, 250 n.7 (1985).
Here, even if an attorney-client relationship existed
between Welsh and the defendants, the judge properly denied the
motion to disqualify because Welsh's services, including his
advice on handicap accessibility and review of certain letters,
never involved matters "substantially related" to Wessell's Wage
Act dispute. See Slade v. Ormsby, 69 Mass. App. Ct. at 546.
Although Welsh advised Wessell on specific Mink Brook employee
matters, those matters were not substantially related to
Wessell's complaint because there was no overlap or similarity.
See id. at 547. Also, Welsh never gained confidential
information in the prior matters that disadvantaged Mink Brook
at trial here.17 See Masiello v. Perini Corp., 394 Mass. at 847-
850; Adoption of Erica, 426 Mass. at 63.18
17
Regarding the employee handbook that Welsh was alleged to
have helped to create for Mink Brook, the judge found the
defendants' contention to be an "overstatement."
18
While Welsh infrequently gave uncompensated legal advice
to Wessell, the defendants and Welsh never expressly created any
formal representation agreement. See Page v. Frazier, 388 Mass.
at 62. Additionally, while a closer question, they never formed
an implied agreement. Even though Wessell sought and obtained
advice from Welsh that was within his professional competence,
and for the purpose of furthering Mink Brook's interests, Mink
Brook could not reasonably have concluded that based on this
11
Lastly, as the judge noted before trial, the defendants'
motion had all the indications of being an "eleventh hour
maneuver[]" to disqualify opposing counsel despite numerous
opportunities before trial to raise the objection. Masiello v.
Perini Corp., 394 Mass. at 850. The defendants filed their
motion on the eve of trial, about one and one-half years after
Wessell's complaint. Without a sufficient explanation for the
extraordinary delay,19 the motion was properly denied not only as
without merit but also as a dilatory tactic.
Damages under Wage Act. The defendants argue that the
judge erred when he instructed the jury that they could award
the plaintiff compensatory damages ("back pay") for a violation
of the Wage Act, specifically for a retaliatory firing
prohibited under G. L. c. 149, § 148A.20 They maintain that one
infrequent, informal, and free advice that Welsh represented the
company. See DeVaux v. American Home Assur. Co., 387 Mass. at
818-819.
19
At oral argument, counsel for the defendants explained
that the original claim was for a minimal amount, and there was
a belief that the matter would be settled prior to trial.
(Indeed, during the hearing on the disqualification motion,
defense counsel told the judge that "there was always a hope
that it would settle or resolve, or it would just go away at
some point.") Even so, that belief had to dissipate as the
trial date approached.
20
The judge instructed the jury that "if you find that Ms.
Wessell was terminated unlawfully from making a complaint
regarding the Wage Act, then she is entitled to damages of the
amount she would have earned if she had not been wrongfully
12
who violates § 148A "shall be punished or shall be subject to a
civil citation or order as provided in [G. L. c. 149, §] 27C,"
only, and that § 148A does not enable a private individual to
obtain compensatory damages because the criminal and civil
penalties in § 27C are the exclusive remedy, enforceable by the
Attorney General only, for § 148A violations.21
The Wage Act has interrelated mechanisms to ensure that
employees are timely paid and protected when that right is
asserted. Under G. L. c. 149, § 148, as amended by St. 1992,
c. 133, § 502, an employer "shall pay weekly or bi-weekly each
such employee the wages earned by him to within six days of the
termination of the pay period during which the wages were earned
if employed for five or six days in a calendar week . . . ."
The first paragraph of G. L. c. 149, § 148A, inserted by
discharged from the date of her termination, forward to this
date."
21
The second paragraph of § 148A, which the defendants cite
as support for their argument, states,
"Any employer who discharges or in any other manner
discriminates against any employee because such employee
has made a complaint to the attorney general or any other
person, or assists the attorney general in any
investigation under this chapter, or has instituted, or
caused to be instituted any proceeding under or related to
this chapter, or has testified or is about to testify in
any such proceedings, shall have violated this section and
shall be punished or shall be subject to a civil citation
or order as provided in section 27C."
G. L. c. 149, § 148A, as amended by St. 1999, c. 127, § 144.
13
St. 1977, c. 590, mandates that "[n]o employee shall be
penalized by an employer in any way as a result of any action on
the part of an employee to seek his or her rights under the
wages and hours provisions of this chapter." Completing the
circle, G. L. c. 149, § 150, authorizes an employee faced with a
violation of § 148 or § 148A to bring a civil action "for any
damages incurred, and for any lost wages and other benefits."22
See Fernandes v. Attleboro Hous. Authy., 470 Mass. 117, 126-127
(2014).
The defendants' view, that the remedy under § 148A is
limited to criminal and civil penalties and not damages from the
date of retaliation up to the date of judgment, is overly
restrictive, essentially ignores G. L. c. 149, § 150, and leaves
those aggrieved with no option other than a complaint to, and
action by, the Attorney General. The Wage Act, when read as a
whole to ensure payment and to protect employees who assert that
right, does not support the defendants' assertion that the § 27C
22
"An employee claiming to be aggrieved by a violation of
[§ 148, § 148A, or other specified sections] may, 90 days after
the filing of a complaint with the attorney general, or sooner
if the attorney general assents in writing, and within 3 years
after the violation, institute and prosecute . . . a civil
action for injunctive relief, for any damages incurred, and for
any lost wages and other benefits." G. L. c. 149, § 150, as
amended by St. 2008, c. 80, § 5. (We note that the 2014
amendments to § 150, even had they not postdated the events at
issue in this litigation, did not change the language applicable
here. See St. 2014, c. 260, § 11; St. 2014, c. 292, § 1.)
14
language is exclusive and only allows actions by the Attorney
General. In so arguing, the defendants ignore the authorization
in § 150 for a private cause of action for retaliation
prohibited by the first paragraph of § 148A.
In sum, read in totality, for wage claims under § 148, an
employee may recover earned wages that an employer has withheld.
For retaliation claims under § 148A, an employee terminated by
an employer for asserting a wage right may recover damages
stemming from the termination. Damages for retaliation may
include earnings from the date of termination up to trial. See
Johnson v. Spencer Press of Me., Inc., 364 F.3d 368, 379 (1st
Cir. 2004) ("An award of back pay compensates plaintiffs for
lost wages and benefits between the time of the discharge and
the trial court judgment").23
Here, the defendants' retaliatory firing of Wessell
violated § 148A, which triggered Wessell's § 150 remedy for
23
While the defendants failed to object after the judge
delivered his final instructions to the jury, it appears that
defense counsel throughout challenged the back pay jury
instruction. At a precharge hearing, defense counsel objected
to the proposed instruction, and the judge acknowledged his
objection. Although a judge may save or preserve rights at an
earlier time that might, in some circumstances, excuse the need
for a timely objection later, "we discourage the practice."
Commonwealth v. Almele, 87 Mass. App. Ct. 218, 224 (2015). See
Rotkiewicz v. Sadowsky, 431 Mass. 748, 751 (2000), citing Flood
v. Southland Corp., 416 Mass. 62, 66-67 (1993). See also id. at
67 ("Cautious counsel, however, wisely will renew any earlier
objection with specificity after the charge unless the judge
then instructs otherwise"); Mass.R.Civ.P. 51(b), 365 Mass. 816
(1974).
15
recovery of "any damages incurred, and . . . any lost wages and
other benefits." The judge correctly instructed the jury that
if they found that the defendants fired Wessell in retaliation,
the jury could award her damages based on her earnings from the
date of her termination until the date of the jury's decision.
See Fernandes v. Attleboro Hous. Authy., 470 Mass. at 130 &
n.11.
Amended judgment affirmed.