Warshaw et al v. QBE Ins. Corp. et al

Filing 48

Magistrate Judge Kenneth P. Neiman: ORDER entered with regard to 24 Plaintiffs' Motion to Amend the Complaint, cc:cl. "...For the reasons stated, Plaintiffs' motion to amend the complaint is DENIED." (Healy, Bethaney)

UNITED STATES DISTRICT COURT
DISTRICT OF MASSACHUSETTS

GERALD AND HELAINE
WARSHAW,

)
)
)
Plaintiffs
)
)
)
v.
)
)
)
QBE INS. CORP., COMMUNITY
)
ASSOCIATION UNDERWRITERS OF )
AMERICA, INC., COLDBROOKE
)
SOUTH UNIT OWNERS’ TRUST,
)
BERKSHIRE INS. GROUP, INC.,
)
R.E.M. ENTERPRISES, INC.,
)
)
Defendants )

Civil Action No. 11-12068-MAP

ORDER WITH REGARD TO PLAINTIFFS’ MOTION
TO AMEND THE COMPLAINT (Doc. No. 24)
August 22, 2012
NEIMAN, U.S.M.J.
Presently before the court is Gerald and Helaine Warshaw (“Plaintiffs”)’ first
motion to amend the complaint. Plaintiffs seek to add an additional count against
Defendant R.E.M. Enterprises, Inc. (“REM”), for breach of the implied warranties of
merchantability and fitness for a particular purpose pursuant to Mass. Gen. Laws c. 106
§ 2-316A. For the reasons discussed below, the court will deny Plaintiffs’ motion.
I. FACTUAL BACKGROUND
Plaintiffs own a seasonal home located at Unit 15B of the Coldbrooke South
Condominium Association in Lenox, Massachusetts. Pursuant to their condominium
association agreement with Coldbrooke, Plaintiffs were required to keep their unit at or

above 62 degrees during the winter months. In an effort to meet that requirement,
Plaintiffs contracted with REM to monitor their property for low temperatures. Although,
at this time, the parties disagree about the exact parameters of the contract, the initial
agreement was entitled “Alarm Monitoring and Services Agreement” (hereinafter the
“Agreement”), through which REM agreed to monitor the temperature at Plaintiffs’ unit.
Also included in the Agreement are several disclaimers in which REM expressly
disclaims liability for, among other things, breach of any warranties of fitness or
merchantability.
On or about March 31, 2011, personnel at Coldbrooke discovered water running
at Plaintiffs’ unit, the cause of which was subsequently determined to be a copper pipe
that froze and then burst, resulting in water damage to the unit. Plaintiffs subsequently
brought this action against several parties, including REM for breach of contract.
II. DISCUSSION
Pursuant to Fed. R. Civ. Pro. 15(a), “consent to file amended pleadings ‘shall be
freely given when justice so requires,’ unless the amendment would be futile or reward
undue delay.” Adorno v. Crowley Towing and Transp. Co., 443 F.3d 122, 126 (1st Cir.
2006) (quoting Fed. R. Civ. Pro. 15(a)). Although Rule 15 has established a “rather
forgiving standard, ‘in considering a motion for leave to amend the trial court must first
consider whether the proposed new claims are futile, that is, whether they would be
subject to dismissal for failure to state a claim.’” MacNeill Engineering Co., Inc. v.
Trisport, Ltd., 59 F. Supp. 2d 199, 201 (D. Mass. 1999) (quoting Smith v. Mitre Corp.,
949 F. Supp. 943, 945 (D. Mass. 1997)).
2

As explained, Plaintiffs seek to add a count against REM for breach of
warranties of fitness and merchantability pursuant to Mass. Gen. Laws c. 106 § 2-316A.
REM opposes Plaintiffs’ motion, arguing that such a claim is futile, as the services
provided by REM are excluded from the scope of the Massachusetts statute relied on
by Plaintiffs. The court finds REM’s position persuasive.
One of the provisions of Massachusetts General Laws on which Plaintiffs rely in
moving to amend their complaint provides as follows:
Any language, oral or written, used by a seller or
manufacturer of consumer goods and services, which
attempts to exclude or modify any implied warranties of
merchantability and fitness for a particular purpose or to
exclude or modify the consumer’s remedies for breach of
those warranties, shall be unenforceable.
Mass. Gen. Laws c. 106 § 2-316A(2). The second provision relied on by Plaintiffs
states expressly that “[t]he provisions of this section may not be disclaimed or waived
by agreement.” Mass. Gen. Laws c. 106 § 2-316A(5). Citing these provisions in
tandem, Plaintiffs argue that REM cannot waive, alter, or amend the warranties of
merchantability and fitness for a particular purpose and, therefore, their motion to
amend is not futile.
Both provisions cited by Plaintiffs, however, fall under the portion of the
Massachusetts General Laws that codify the Uniform Commercial Code and, as such,
apply to transactions in goods only. Mattoon v. City of Pittsfield, 775 N.E.2d 770, 783
(Mass. App. Ct. 2002) (“As a threshold matter, the code’s art. 2 warranty provisions are
limited to transactions in ‘goods.’”); see also Phillips v. Medtronic, Inc., 754 F. Supp. 2d

3

211, 216 (D. Mass 2010) (claims for breach of implied warranties of merchantability
and/or fitness “must arise out of ‘transactions in goods’ and not the provision of
services”) (quoting Mass. Gen. Laws c. 106 § 2-102). As the Massachusetts Court of
Appeals stated in Mattoon, “in contrast to the sale of goods, the rendition of services is
not covered by art. 2 of the code” and explained that, where a contract implicates both
goods and services, the test to determine the applicability of art. 2 is whether “the
predominant factor, thrust or purpose of the contract is . . . the rendition of service, with
goods incidentally involved.” 775 N.E.2d at 783.
Here, Plaintiffs do not allege that any goods were sold to them in the course of
their relationship with REM; in fact, the Agreement was entitled the “Alarm Monitoring
and Services Agreement.” Indeed, in their complaint, Plaintiffs allege only that a low
temperature alarm was “installed, maintained and monitored” by REM, all of which
indicate an on-going service rather than a transaction in goods, which are defined as
“all things . . . which are movable at the time of identification to the contract for sale.”
Id. (quoting Mass. Gen. Laws c. 106 § 2-105(1)). To the extent, then, that Plaintiffs
wish to assert a claim for the breach of warranties under art. 2, that effort would be
futile. And to the extent that Plaintiffs’ complaint even hints that a sale of goods may
have taken place between the parties, that transaction was merely incidental to the
alarm monitoring services provided by REM.
III. CONCLUSION
For the reasons stated, Plaintiffs’ motion to amend the complaint is DENIED.
IT IS SO ORDERED.
4

DATED: August 22, 2012
/s/ Kenneth P. Neiman
KENNETH P. NEIMAN
U.S. Magistrate Judge

5