Kunelius v. Town of Stow

First Circuit decision in Kunelius v. Town of Stow

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Similar to other states, Massachusetts provides tax relief to landowners of agricultural, horticultural or forest land. When such land is converted to other uses, the Commonwealth requires landowners to compensate their respective municipalities. Massachusetts law also provides that once a landowner decides to sell the land for other than agricultural, horticultural, or as relevant here, forest uses, the municipality is entitled to a right of first refusal ("ROFR"). Mass. Gen. Laws ch. 61.

What happens if the town exercises the ROFR, but doesn't close. This case explores the issues.

The town thought that the liquidated damages provision in the original agreement was operative. The landowner argued that the ROFR did not include the liquidated damages. The court found for the town.

The second issue was that the liquidated damages provision should not be enforced because it was too small. This is very different than the usual argument that the damages are too large and act as a penalty. The landowner lost on this issue as well.

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Reference Info:Decision | Federal, 1st Circuit | United States


DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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