O  T  H  E  R      D  E  C  I  S  I  O  N  S  :

Abbott v. Arthur MacKenzie Productions, Inc., 21 Mass. L. Rep. 2, 2006
Mass. Super. LEXIS 220 (April 3, 2006) (van Gestel, J.).

Plaintiff prevailed in his claims against Arthur MacKenzie (“MacKenzie”) and two of MacKenzie’s companies, including claims for breach of fiduciary duty, misappropriation and conversion. Plaintiff then sought to collect on the judgment through an attachment on the residence in which MacKenzie lived with his wife, Maralyn. The house, located in Weston, has been in Maralyn’s name since 1973. Plaintiff alleged that he is entitled to reach and apply MacKenzie’s interest in the property to the extent misappropriated funds were used to enhance the value of the property, including for example by paying the mortgage. Plaintiff also alleged that a constructive trust existed over Maralyn’s interest in the property.

The Court allowed Maralyn’s motion for summary judgment. The Court held that a constructive trust required a showing that the recipient of the property (here, Maralyn) had given no value for the property or had knowledge of the violation of MacKenzie’s duties. Because there was no evidence that Maralyn was in any respect involved in MacKenzie’s businesses nor evidence that she had 

knowledge of MacKenzie’s violation of his duties to the Plaintiff, the Court refused to impose a constructive trust. In so holding, the Court vehemently rejected Plaintiff’s argument that Maralyn did not give value for her interest in the Property simply because she was a traditional housewife.

The Court also rejected Plaintiff’s reach and apply claim. Citing a recent Appeals Court opinion, Stevens v. Nagel, 64 Mass. App. Ct. 136 (2005), the Court required a demonstration that Maralyn held property “under such circumstances that in equity and good conscience she ought not retain it.” Absent evidence that Maralyn was aware of her husband’s breaches of duty, the Court refused to permit Plaintiff to reach and apply “some incalculable enhancement in value to Maralyn’s real estate. . . .”

Finally, due to the ill health of MacKenzie and the complicated legal issues facing him, the Court denied MacKenzie’s counsel’s motion to withdraw. The Court refused to leave MacKenzie unrepresented, notwithstanding that counsel’s bills had not been paid nearly in full, if at all.