Kennedy v. Commonwealth

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16-P-1464 Appeals Court

RUTH KENNEDY & others1 vs. COMMONWEALTH & others.2

No. 16-P-1464.

Hampshire. September 19, 2017. - January 18, 2018.

Present: Vuono, Blake, & Singh, JJ.

School and School Committee, Regional school district, Standing
to challenge validity of statute. Contract, Regional
school district, Promissory estoppel. Constitutional Law,
Standing, Home Rule Amendment, Special law. Municipal
Corporations, Home rule. Statute, Special law. Practice,
Civil, Standing, Declaratory proceeding, Motion to dismiss.
Declaratory Relief.

Civil action commenced in the Superior Court Department on
October 31, 2014.

Motions to dismiss were heard by Bertha D. Josephson, J.

James B. Lampke (Russell J. Dupere also present) for the
plaintiffs.
Layla G. Taylor for town of Worthington.

1
Derrick Mason, town of Huntington, and Gateway regional
school district.
2
Town of Worthington, Department of Elementary and
Secondary Education, and town of Russell.
 2

Kerry David Strayer, Assistant Attorney General (Juliana
deHaan Rice, Assistant Attorney General, also present) for the
Commonwealth & another.

VUONO, J. This appeal arises from the town of

Worthington's (Worthington's) withdrawal from the Gateway

regional school district (school district) pursuant to special

legislation. The school district was established in 1957 and

consisted of seven member towns in Hampden and Hampshire

Counties until May 7, 2014, when the Legislature adopted "An Act

Relative to the Withdrawal of the Town of Worthington From the

Gateway Regional School District." St. 2014, c. 97 (act). The

act enabled Worthington to withdraw from the school district

without the consent of the other member towns. The school

district, the town of Huntington (Huntington), Ruth Kennedy (a

resident of the member town of Russell), and Derrick Mason (a

resident of the member town of Russell), brought an action in

Superior Court against Worthington, the Commonwealth, the

Department of Elementary and Secondary Education (department),

and the town of Russell, challenging the act. The defendants

filed motions to dismiss pursuant to Mass.R.Civ.P. 12(b)(1) &

(6), 365 Mass. 754 (1974), which a judge allowed. Primarily for

the reasons set forth in the judge's well-reasoned memorandum of

decision, we affirm.
 3

Background. Between 1957 and 1968, the towns of Russell,

Worthington, Huntington, Middlefield, Montgomery, Chester, and

Blandford entered into an agreement for the creation and the

operation of the school district. See G. L. c. 71, §§ 14-14B,

15. Among other things, the agreement provides for the location

of schools, the apportionment and payment of costs by member

towns, and the employment of teachers. The agreement also

outlines the procedures through which a town may enter and

withdraw from the school district. Withdrawal of a member town

must be done by amendment to the agreement, and the withdrawal

takes effect after each town in the school district accepts the

amendment by obtaining a majority vote from its residents during

a town meeting. The agreement requires unanimous approval by

the remaining towns before a town may withdraw. Any town

allowed to withdraw from the school district remains liable

under the agreement for its share of unpaid operating costs and

indebtedness for capital expenses incurred while the withdrawing

town was a member.

In early 2013, Worthington advised the school district that

it wished to withdraw, and then attempted to do so. However,

Worthington failed to obtain the approval of the other member

towns and, as a result, the residents of Worthington voted to

file a home rule petition with the Legislature seeking

legislation that would permit Worthington to withdraw from the
 4

school district. See art. 89, § 6, of the Amendments to the

Massachusetts Constitution (home rule amendment).3

On July 8, 2013, a home rule petition was filed on behalf

of Worthington. See 2013 House Doc. No. 3574. The plaintiffs

state that the proposed legislation was changed to "a non-home

rule bill," though they dispute that it was changed to a special

law.4 On April 28, 2014, the Legislature approved the act, and

it was signed by the Governor on May 7, 2014. The act states in

relevant part:

"Notwithstanding chapter 71 of the General Laws or any
other general or special law or agreement to the contrary,
the town of Worthington may unilaterally withdraw as a
member of the Gateway Regional School District."

St. 2014, c. 97, § 1. The act required Worthington to pay the

school district (1) any amounts that it would have been

obligated to pay under the agreement for operating and capital

costs, and (2) any amounts owed under the agreement to the

Massachusetts School Building Authority. St. 2014, c. 97, § 2.

3
Pursuant to the home rule amendment, the Legislature has
the power to act in relation to all cities, all towns, all
cities and towns, or to a class of cities and towns of not fewer
than two; the Legislature also has the power to act when the
legislation only affects one city or town, by way of a special
law, if the municipality has met certain requirements. See
Opinion of the Justices, 429 Mass. 1201, 1204 (1999).
4
The defendants allege that the legislation was changed to
a special law. There is no explanation in the record regarding
whether the bill was indeed changed to a bill for a special law,
aside from disputing statements of the parties. As explained
infra, the act was not improper however it is viewed.
 5

The act also directed the department to convene a

"reorganization needs conference," to assess, among other

things, (1) the impact of Worthington's withdrawal, (2) its

effect on current and future enrollments in the school district,

(3) an inventory of the educational facilities in the school

district, and (4) Worthington's continued obligations for

capital indebtedness.

In their amended complaint, the plaintiffs sought damages

and declaratory relief, contending that adoption of the act and

any related actions taken by the defendants constitutes an

unconstitutional impairment of contract, a violation of the home

rule amendment, interference with contractual relations (the

plaintiffs subsequently withdrew this claim), and a violation of

the so-called "local mandates" law, see G. L. c. 29, § 27C. The

plaintiffs also claim that Worthington breached the agreement

and the implied covenant of good faith and fair dealing,

requiring promissory estoppel due to the plaintiffs' detrimental

reliance.

In allowing the defendants' motions to dismiss, the judge

reasoned that the two individual plaintiffs, i.e., Kennedy and

Mason, did not have standing to raise any claim regarding the

act because their harm was too speculative. The judge also

determined that the school district and Huntington did not have

standing to claim that the act violated the contracts clause of
 6

the United States Constitution because only "citizens" have the

right to challenge the constitutionality of the act. She

further held that the school district did not have standing to

claim that the act violated the home rule amendment because the

school district was not a municipality. Furthermore, she held

that the act did not violate the home rule amendment as the act

did not apply solely to Worthington, i.e., it related to all of

the towns in the school district.

The remaining contract and promissory estoppel claims were

similarly dismissed. The judge held that Worthington acted in

good faith in its attempt to withdraw from the agreement,

through the method provided in the agreement; it was only when

the parties "reached a stalemate" that Worthington sought action

from the Legislature. Regarding the estoppel claim, she found

no allegation of concealment or a misrepresentation by

Worthington, and therefore there could not have been any

reliance by the plaintiffs. The judge also held that the act

did not violate the local mandates law, and that the plaintiffs

were not entitled to a declaratory judgment as there was no

actual controversy. The complaint was dismissed and judgment

entered. The plaintiffs appealed.

Discussion. 1. Standing. "A defendant may properly

challenge a plaintiff's standing to raise a claim by bringing a

motion to dismiss under Mass.R.Civ.P. 12(b)(1) or (6)." Ginther
 7

v. Commissioner of Ins., 427 Mass. 319, 322 (1998). "'While a

complaint attacked by a . . . motion to dismiss does not need

detailed factual allegations . . . a plaintiff's obligation to

provide the "grounds" of his "entitle[ment] to relief" requires

more than labels and conclusions . . . . Factual allegations

must be enough to raise a right to relief above the speculative

level . . . [based] on the assumption that all the allegations

in the complaint are true (even if doubtful in fact) . . . .'

[Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007)]. What is

required at the pleading stage are factual 'allegations

plausibly suggesting (not merely consistent with)' an

entitlement to relief." Iannacchino v. Ford Motor Co., 451

Mass. 623, 636 (2008), quoting from Bell Atl. Corp., supra at

557. On appeal, we "accept the factual allegations" in a

plaintiff's complaint, "as well as any favorable inferences

reasonably drawn from them, as true." Ginther, 427 Mass. at

322.

Here, the defendants claim that the individual plaintiffs,

Kennedy and Mason, do not have standing to challenge the act

because they have not suffered any harm. The defendants also

assert that the town of Huntington and the school district lack

standing to raise claims for impairment of contract under the

contracts clause of the United States Constitution and pursuant

to the home rule amendment.
 8

A. Plaintiffs Kennedy and Mason. We agree with the

judge's conclusion that Kennedy and Mason lack standing because

they have failed to allege facts beyond mere speculation that

they will incur damages as a result of the act or Worthington's

withdrawal from the school district. Kennedy and Mason allege

that they "will have to pay more in taxes and other municipal

fees in order to make up for the loss of the financial

obligations" owed by Worthington under the agreement, and that

Worthington's withdrawal is "causing serious and irreparable

damage, financial and otherwise and disruption to the orderly

and effective administration of the [school district] to the

detriment of" the plaintiffs.

These assertions are merely conclusions and are not

supported by allegations of specific injury; therefore, they do

not rise above speculation and are not sufficient to confer

standing. See Tax Equity Alliance for Mass. v. Commissioner of

Rev., 423 Mass. 708, 715-716 (1996) ("[O]nly persons who have

themselves suffered, or who are in danger of suffering, legal

harm can compel the courts to assume the difficult and delicate

duty of passing upon the validity of the acts of a coordinate

branch of the government" [citation omitted]). See also

Ginther, supra at 323 (plaintiffs who have not alleged facts

that "place them within the area of concern of the statute" do

not have standing as they have not alleged substantial injury).
 9

B. Remaining plaintiffs. Next, the defendants assert that

the school district and the town of Huntington are governmental

entities and therefore are not entitled to raise any

constitutional claims. We agree. The school district, created

pursuant to G. L. c. 71, is "a body politic and corporate" that

has the power "[t]o sue and be sued, but only to the same extent

and upon the same conditions that a town may sue or be sued."

G. L. c. 71, § 16, inserted by St. 1949, c. 638, § 1. As

"political subdivision[s] of the Commonwealth," Dartmouth v.

Greater New Bedford Regional Vocational Technical High Sch.

Dist., 461 Mass. 366, 379 (2012), towns "are not 'persons' for

purposes of challenging the constitutionality" of State

statutes. Id. at 380. See Spence v. Boston Edison Co., 390

Mass. 604, 609 (1983). Thus, neither the school district nor

Huntington has standing to challenge the constitutionality of

the act. Id. at 608-610 (city cannot invoke constitutional

protections against State). Accordingly, the plaintiffs'

constitutional claims properly were dismissed.5

C. Pursuant to home rule amendment. Section 8 of the home

rule amendment states that the Legislature "shall have the power

to act in relation to cities and towns, but only by [G]eneral

5
The school district and Huntington invite us to "exercise
[our] broad authority and adopt a limited and specific exception
to the standing rules for governmental entities to challenge
certain [S]tate laws." We decline the invitation.
 10

[L]aws which apply alike to all cities or to all towns, or to

all cities and towns, or to a class of not fewer than two, and

by special laws." The plaintiffs argue that the act is not a

special law and yet it applies to only one town, i.e.,

Worthington, thus violating the home rule amendment. "A

municipality has standing to assert this [type of] claim."

Clean Harbors of Braintree, Inc. v. Board of Health of

Braintree, 415 Mass. 876, 881 (1993) (Clean Harbors). For the

purpose of this appeal we assume without deciding that the

school district has standing as well.

We conclude, as did the judge, that even though the act

permitted only Worthington to withdraw from the school district

and, as a result, had the appearance of a special law, the act

was appropriate legislation under the home rule amendment.

Contrast Opinion of the Justices, 374 Mass. 843, 850-851 (1978).

In effect, as the judge ruled, the act sets out the rights and

duties of all seven member towns of the school district prior to

and after the withdrawal of Worthington. St. 2014, c. 97, § 4.

The home rule amendment preserves the Legislature's rights with

respect to "State, regional, and general matters." Clean

Harbors, supra. Because, the act did not affect only
 11

Worthington, Huntington's (and the school district's) challenge

to the act fails.6 See id. at 881-882, and cases cited.7

2. Contract claims. The school district and Huntington

further claim that the act effectively permits Worthington to

breach the agreement and the implied covenant of good faith and

fair dealing; the plaintiffs also seek promissory estoppel based

on their detrimental reliance on the agreement.8 The flaw in

this argument is that Worthington sought to withdraw from the

school district according to the terms of the agreement. When

Worthington's effort to withdraw pursuant to the agreement

failed, Worthington sought legislative action as an alternative

means for withdrawal from the school district. The act, see

c. 97, §§ 2-4, sets out the specific means whereby Worthington

could withdraw from the school district. Section 4 of the act

6
If the act is viewed as the defendants prefer, i.e., as a
special law affecting only one municipality, it still was proper
because it was a petition based on a vote by the town meeting of
Worthington.
7
The plaintiffs sought to amend their complaint to allege
that the act violates art. 30 of the Massachusetts Constitution.
In light of the foregoing discussion, the judge did not abuse
her discretion by failing to allow the motion to amend.
8
The plaintiffs also seek specific performance of the
contract. Specific performance requires findings that money
damages are not an adequate remedy under the contract. See
Perillo, Corbin on Contracts §§ 63.1, 63.4, and 63.5 (2012).
The judge did not reach the issue of specific performance of the
agreement as it is not appropriate for resolution on a motion to
dismiss. Moreover, she disposed of the contract claims as a
matter of law.
 12

required, among other things, the commissioner of the department

to evaluate:

"a long range education plan to determine: (i) the impacts
of the withdrawal; (ii) the impacts of the withdrawal on
current and future enrollment in the district; (iii) an
inventory of all educational facilities under the
jurisdiction of the remaining communities in the district;
(iv) plans for the reimbursement of the [C]ommonwealth's
capital expenditures for facilities located in the town of
Worthington; (v) the requirements for continued assessments
to the town of Worthington for district facilities
previously paid by the town of Worthington; (vi) the
administrative structure of the new district; (vii) the
long-term fiscal impacts of the withdrawal of the town of
Worthington, including detailed analyses of transportation,
special education, vocational education and personnel
costs; and (viii) fiscal recommendations to hold harmless
the remaining communities."9

This is not a situation where Worthington withdrew from the

school district unilaterally and ceased paying the required

amounts incurred by the school district while enjoying the

benefits of the services rendered by the school district. As

the judge noted, the amended complaint does not establish any

affirmative detrimental consequences, but instead provides a

brief and unspecified accusation regarding additional costs.

There is nothing in the amended complaint that rises above the

speculative level as to factual allegations of bad faith or a

representation by Worthington on which the plaintiffs relied.

9
The plaintiffs argue that the indirect personnel costs,
especially retirement benefits and health care costs, are
sufficient to establish standing. However, § 4 of the act
addresses these costs.
 13

3. Remaining claims. A. Local mandates law. General

Laws c. 29, § 27C(a), inserted by St. 2012, c. 165, § 112,

provides in pertinent part: "Any law . . . imposing any direct

service or cost obligation upon any city or town shall be

effective . . . only if such law is accepted by vote . . . in

the case of a town by a town meeting . . . ." The amended

complaint does not plead any facts that support Huntington's or

the school district's position that either is likely to incur

direct cost obligations other than a possible increase in what

the remaining towns may be required to pay to support the school

district. These alleged costs are indirect and in any event are

speculative; therefore, they are not sufficient under § 27C(a)

to support the plaintiffs' claim.

B. Declaratory judgment. Finally, as the judge correctly

observed, because all of the plaintiffs' claims could not

survive the motion to dismiss, there was no actual controversy

at stake and declaratory relief therefore is not available. See

Gay & Lesbian Advocates & Defenders v. Attorney Gen., 436 Mass.

132, 134 (2002).

Judgment affirmed.