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Archive for August, 2014

COURT FINDS THAT AN ELECTRONICALLY SIGNED AGREEMENT PERFECTS A MECHANIC’S LIEN

Posted on: August 29th, 2014 by admin

ABC In a case that modernizes the Massachusetts mechanics’ lien statute, M.G.L. c. 254 et seq., Bennett & Belfort Attorney Eric LeBlanc successfully argued that electronic signatures satisfy the mechanics’ lien statute’s “written contract” requirement.  In the recent Massachusetts Superior Court decision Clean Properties, Inc. v. Riselli, the Middlesex Superior Court decided that “[n]othing in the mechanics’ lien statute requires a physical signature…on a piece of paper rather than an acceptance of written contract terms by an electronic signature that is conveyed by email.” (C.A. No. 2014-04742) (Salinger, J.)

In Clean Properties, it is alleged that Defendant, Carol Riselli, was provided with a written proposed contract by Clean Properties, Inc., an environmental services company, to perform environmental cleanup work on an emergency basis at Riselli’s property.  Riselli apparently responded via email, stating that she agreed to the terms of the contract.  After Clean Properties performed substantial work on the property, it is claimed Riselli failed to make a single payment.  Clean Properties placed a mechanics’ lien on Riselli’s property, and initiated litigation to recover payment for its services.  Riselli attempted to dissolve the mechanics’ lien, claiming that because there was no signed, written agreement, the “written contract” requirement of the mechanics’ lien statute was not satisfied. The Court disagreed.

Defendant unsuccessfully argued that “no written contract was ever formed because neither party affixed a handwritten signature to a paper form of the contract.”  However, the Court appears to have been persuaded by the plain meaning of the Massachusetts Uniform Electronic Transactions Act (“MUETA”), M.G.L. 110G et seq., which provides that an electronic record or acceptance by email results in a binding contract, and satisfies the statutory requirements of a “written contract.”   The MUETA defines an electronic record as, “a record created, generated, sent, communicated, received or stored by electronic means,” and does not require a physical signature for it to be enforced.

Superior Court Judge Kenneth W. Salinger agreed and found on these facts that the email Riselli sent to Clean Properties, Inc., which contained her name in the signature block, and expressed her assent to be bound by the deal, formed a binding electronic record under the Uniform Electronic Transactions Act.

The Clean Properties, Inc. v. Riselli decision is further evidence that the law is evolving to meet the pervasive use of new technology in business and society at large.  In light of today’s wide use of electronic communications, this precedent adds clarity that both businesses and individuals can rely upon.  The decision underscores that even in our rapidly evolving world of tweets, face book and electronic mail, the old adage coined by William Penn still holds true: “Rarely promise, but, if lawful, constantly perform.”

Release Bars Wage Claim Despite Lack of Specific Reference to Massachusetts Wage Act

Posted on: August 11th, 2014 by admin

District-MassachusettsUntil recently, it was thought that an employee’s waiver of rights to sue for past due compensation or wages as reflected in a signed release of claims had to be spelled out with precision.  Since the Supreme Judicial Court’s 2012 decision in Crocker v. Townsend, in which the Court held that an employee’s release did not prevent him from filing a later claim under the Wage Act, many employers have included a specific reference to “the Massachusetts Wage Act” in their release provisions.  However, a recent U.S. District Court decision – MacLean v. TD Bank, N.A. – states that a specific reference to the Wage Act is not required, and a release bars any claim for unpaid wages as long as the language is clear that the employee is waiving his or her right to be paid wages.

The Plaintiff in MacLean signed a severance agreement that involved the payment of approximately $500,000 in exchange for a release of all claims.  The release provision included a waiver of claims “related to the payment of wages, bonuses, incentives, and other compensation” and rights relating to “compensation agreements.” However, the release did not specifically reference the Wage Act.  Later, the Plaintiff filed suit, claiming that the Defendant failed to compensate him for 23 days of PTO time he had accrued.

Despite the Plaintiff’s argument that the release he signed was insufficient based upon the Crocker decision because there was no specific citation to the Wage Act, the U.S. District Court disagreed and held that the Crocker decision did not require a specific citation to the Wage Act.  Instead, the Court opined that in order to validly release all claims under the Wage Act, a release only required a reference to the “rights and claims” under the Wage Act.  Accordingly, the Court held that the release was sufficient to waive the Plaintiff’s later claims for non-payment of PTO time because it included “plainly worded and understandable references to the rights Plaintiff was giving up under the Wage Act”.

The MacLean decision is instructive, as many employers responded to the Crocker decision by including specific citations to the Wage Act in their releases.  The U.S. District Court has now clarified that those specific citations are not necessary.

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