Cerretani v. Fudge

Statement of the Issues Presented for Review...................................................................1

Statement of the Case and Facts......................................................................................2

Conclusion....................................................................................................................34

Addendum.................................................................................................................Post

Statutory and Rule Addendum...................................................................Post Addendum

Rule 16 Attorney Certification.......................................Post Statutory and Rule Addendum

Abrams v. Burg, 367 Mass. 619-621(1975).................................................................23

Bercume v. Bercume, 428 Mass. 635, 638-640(1999).................................................32

Bird v. Capital Site Management Co., 423 Mass. 172(1996).................................25;26

Bisienere v. Buccino, 36 Mass. App. Ct. 749, 753-754 (1994)....................................25

Blackwell v. E.M. Helides, Jr., Inc., 368 Mass. 225(1975)..........................................15

Boyden v. Hill, 198 Mass. 477, 484-485(1908)......................................................29-30

Canney v. New England Telephone & Telegraph Co.,
353 Mass. 158, 165(1967)...........................................................................................24

Cepek v. Cepek, 22 Mass. App. Ct. 331, 333(1986)...................................................20

Kehillath Jacob, 370 Mass. 828, 834 (1976)..............................................................30

City Coal Co. of Springfield v. Noonan, 434 Mass. 709(2001).................................27

DeChristofaro v. DeChristofaro, 24 Mass. App. Ct.231(1987).................................32

Department of Revenue v. W.Z., 412 Mass. 718, 721-722(1992)..............................33

Diver v. Diver, 402 Mass. 599, 402(1988).................................................................26

Downey v. Downey, 55 Mass. App. Ct. 812, 815-817(2002).....................................32

Fugere v. Fugere, 24 Mass. App. Ct. 758, 759-760(1987)........................................32

Gifford v. Gifford, 354 Mass. 247, 248(1968)...........................................................24

Glick v. Greenleaf, 383 Mass. 290, 293-295(1981)...................................................19

Gouzoulas v. F.W. Stock & Sons, 223 Mass. 537, 539(1916)....................................30

Hills v. Shearer, 355 Mass. 405, 408-409(1969)...................................................20;23

Hinds v. Hinds, 4 Mass. App. Ct. 63, 66-67(1976).....................................................26

J.C. Higgins Company, Inc. v. Bond Bros. Inc.,
58 Mass. App. Ct. 537, 539 (2003).............................................................................28

Judge Rotenberg Educ. Ctr., Inc. v. Commissioner of the
Dep't of Mental Retardation (No.1), 424 Mass. 430, 449-451 (1997)........................25

Kotler v. Spaulding, 24 Mass. App. Ct. 515, 516-517(1987)......................................20

Knox v. Remick, 371 Mass. 433, 437(1976)................................................................23

Larson v. Larson, 28 Mass. App. Ct. 338, 340 (1990).......................................20;25;26

Lowell Bar Ass'n v. Loeb, 315 Mass. 176, 178(1943)..................................................15

Mackeen v. Kasinskas, 333 Mass. 695, 698(1956)......................................................31

Makino, U.S.A. , Inc. v. Metlife Capital Credit Corp.,
25 Mass. App. Ct. 302, 320-321(1987)........................................................................27

Mansur v. Clark, 25 Mass. App. Ct. 618, 620(1988)..............................................20;31

Markell v. Sidney B. Pfeifer Foundation, Inc.,
9 Mass. App. Ct. 412, 440(1980).................................................................................24

Martiniello v. Bamel, 255 Mass. 25, 28 (1926)............................................................30

McCarthy v. Tobin, 429 Mass. 84, 88-89(1999)..........................................................30

McLearn v. Hill, 276 Mass. 519, 524(1931).................................................................31

Parrish v. Parrish, 30 Mass. App. Ct.78,82-87(1991).................................................24

Perkins Sch. for the Blind v. Rate Setting Commn.,
383 Mass. 825, 835(1981)............................................................................................28

Porter v. Harrington, 262 Mass. 203, 207(1928)....................................................29;30

Ratchford v. Ratchford, 397 Mass. 114, 116(1986)......................................................32

Reeves v. Reeves, 318 Mass. 381, 384(1945)................................................................23

Rose v. Regan, 344 Mass. 223, 229(1962).....................................................................29

Schillander v. Schillander, 307 Mass. 96, 98(1940).......................................................23

Simon v. Weymouth Agricultural & Industrial Soc.,
389 Mass. 146(1983)......................................................................................................15

Smith-Clarke v. Clarke, 44 Mass. App. Ct. 404, 405(1998)..........................................33

Stansel v. Stansel, 385 Mass. 510, 515 n.5(1982)..........................................................19

Sterilite Corp. v. Continental Casualty Co.,
397 Mass. 837, 841(1986)..............................................................................................28

Surabian v. Surabian, 362 Mass. 342, 345-347 (1972)..................................................23

Trinity Church in the City of Boston v. John Hancock
Mutual Life Ins. Co., 405 Mass. 682, 684(1989)............................................................27

United Factory Outlet, Inc. v. Jay's Stores, Inc.,
361 Mass. 35, 36-37(1972).............................................................................................26

G.L.c. 208, Section 34A...................................................................................................26

G.L.c. 215, Section 6...................................................................................................19-20

G.L.c. 231, Section 6C.................................................................................................27-28

1. Whether the Probate Judge erred in refusing to find Stephen D. Fudge in civil contempt for refusing to honor his promise to Gail L. Cerretani in their 1988 Separation Agreement to indemnify and hold her harmless for any debt or other obligation caused Cerretani by his refinancing of the marital property and for refusing to pay Cerretani's mortgage “in full” as ordered by the Probate Judge?

2. Did the Probate Judge err in refusing to enforce the parties' 1988 Separation Agreement which as rein-forced by the Probate Judge obligated Fudge to pay Cerretani “the balance on the mortgage to the Haverhill Cooperative Bank in the sum of $169,569.70 or by paying to [her] the monthly principal and interest payment due on said mortgage...until said mortgage is paid in full”?

3. Did the lower court in the absence of changed circumstances unilaterally modify the parties' obliga-tions under the Separation Agreement so that Fudge is now excused from paying Cerretani interest on the money which he, in effect, borrowed from her in 1988 when he refused to perform under their Separation Agreement?

On April 28, 1988, the plaintiff-appellant Gail L. Cerretani (“Cerretani”) and the defendant-appellee Step- hen D. Fudge (“Fudge”) were divorced for the cause of the irretrievable breakdown of their marriage pursuant to the provisions of G.L.c. 208, §1A(A.1-7). Incident to their divorce, the parties executed a Separation Agreement (“the Agreement”), one which was incorporated within the divorce judgement but survived as an independent agree-ment(A.19-52). Among other things, it addressed the disposition of thirty (30) acres of land which the parties owned jointly at 316 Boxford Road in Bradford , Massachusetts (A.35-36).

This 30-acre parcel of land contained the parties' marital home as well as their horse farm(A.36-45). The parties agreed that Cerretani would take unencumbered title to the marital home on approximately two (2) acres of the land while Fudge would take title to the remaining 28 acres free and clear of any claim by Cerretani(A.35-36). At the time the parties divided the premises, the entire 30-acre parcel was encumbered by a first mortgage, a line of credit, real estate taxes, utility charges and other such liabilities(A.35-36).

Cerretani was to take title to the marital home and her 2-acre parcel free and clear of all these existing encumbrances(A.35). In addition, from and after the date of the conveyance of the marital home and acreage to her, Cerretani “shall be solely responsible for and pay from her own funds all costs associated with her ownership of [her] parcel including but not limited to real estate taxes, utilities and the like”(A.35). Moreover, Cerre-tani agreed to indemnify and hold Fudge harmless from and against all claims and costs associated with her owner-ship of this 2-acre parcel containing the former marital home(A.36).

As for Fudge, he was responsible for the existing encumbrances on the entire parcel, for securing the necessary permits in order to subdivide Cerretani's parcel from the rest of the 30 acres of land and for obtaining bank approvals and the refinancing of the debt on the parcel in order to facilitate this division(A.35-36). Furthermore, Fudge likewise agreed

(A.35). In substance, Fudge was responsible for paying off and refinancing the approximately $680,000 mortgage existing on the 30-acre parcel so that he could deliver the marital home with its two acres free and clear to Cerretani consistent with the scheme laid out in their Separation Agreement(A.35-36;58-59). In view of these mutual promises, both parties waived alimony(A.28-29).

Fudge's 28 acres contained about six (6) subdivided, buildable residential house lots and it was anticipated that his agreed-upon refinancing of the debt on the parcel would include his development and/or marketing of these lots(A.58). However, Fudge never marketed these buildable lots to the public and never attempted to refinance the parcel consistent with his obligations under the Separation Agreement(A.58-59). The bank holding the first mortgage on the property, The Haverhill Co-operative Bank (“the Bank”), foreclosed on the entire 30-acre parcel, including Cerretani's parcel containing her 2 acres and the former marital home(A.59).

In order to forestall foreclosure, Fudge and then Cerretani filed petitions for bankruptcy in 1990 and 1991, respectively(A.59). Subsequently, Cerretani was able to retain title to her 2-acre parcel and the former marital home after being forced by the Bank in 1991 to have a $175,000 mortgage placed on her parcel, property she was promised by Fudge to receive free and clear from all such encumbrances under the terms of their Separation Agreement(A.59). The Bank eventually took Fudge's remain-ing 28 acres which contained the six buildable lots and the horse farm and discharged the obligations of both parties on this parcel(A.59;85). Neither party was ulti-mately adjudicated bankrupt as both dismissed their pending petitions(A.59).

Cerretani began making payments to the Bank on her mortgage in the amount of $1,195.30 monthly which repre-sented principal together with interest at the current market rate(A.53;55;59-60). In late 1993 and early 1994, Cerretani brought a complaint for civil contempt against Fudge as well as a complaint for modification alleging that Fudge's failure to honor his promise in the Separation Agreement to deliver to her the 2-acre parcel free and clear of all encumbrances was a contumacious violation of the divorce judgment and the kind of “countervailing equity” which should allow her the right to modify her earlier waiver of alimony contained in the Separation Agreement(A.12-13).

After hearing, the Probate and Family Court Depart-ment, Rockett, J., on September 21, 1994, entered a judgment finding Fudge in contempt for having willfully failed to obey the divorce judgment and its incorporated Separation Agreement by inter alia (1) neglecting and refusing to convey title to the marital home to Cerretani free and clear of encumbrances; and (2) neglecting and refusing to indemnify Cerretani from his liabilities and debts, specifically the Bank's first mortgage on the entire 30-acre parcel which included the former marital home(A.12-13;53-54).

In order to redress this contempt, the Probate Judge ordered Fudge to indemnify and hold Cerretani harmless on her present mortgage which she was forced to obtain from the Bank because of Fudge's contumacious conduct(A.53-54). Fudge could do this in one of two ways: he could either forthwith pay Cerretani her present mortgage balance of $169,569.70 with the Bank; or he could pay the monthly principal and interest payment on this mortgage in the amount of $1,195.30 “until said mortgage is paid in full”(A.53). Besides this, Fudge was ordered to pay Cerretani within thirty days the sum of $37,905.76 as reimbursement for the payments she had already made on this mortgage(A.53-54).

A modification/alimony judgment entered the same day which inter alia repeated the option Fudge had to redress his contempt, i.e., he could either forthwith pay Cerretani her present mortgage balance of $169,569.70 with the Bank; or he could pay the monthly principal and interest payment on this mortgage in the amount of $1,195.30 “until said mortgage is paid in full”(A.55). An amended modification/alimony judgment gave Fudge the right to deduct the mortgage interest on his income tax returns(A.63).

In his findings of fact and conclusions of law supporting these judgments, Judge Rockett made several findings concerning Fudge's increased income, his accumu-lation of assets over the years and his prospering busi-ness(A.58-59). He found, among other things, that Fudge had a net income in 1993 of $228,170.00 and

Since Cerretani who bargained for a mortgage-free home under the parties's Separation Agreement was caused to take out her own mortgage from the Bank for $175,000.00 in order to keep the former marital home, the Probate Judge concluded that “[c]ountervailing equities exist...which entitle [Cerretani] to a judgment ordering [Fudge] to pay the principal and interest payments on [her] present mortgage or to pay the balance due on said mortgage in the sum of $169,569.70 " (A.59-60). As Judge Rockett ruled, Cerretani

In the face of these contempt and modification/ali-mony judgments in 1994, Fudge paid Cerretani the sum of $37,905.76 as reimbursement for the payments she had already made on her mortgage with the Bank and he elected to pay the monthly principal and interest due the Bank in the amount of $1,195.30.

On September 26, 1996, Cerretani sold the parcel to third persons and the settlement statement of that con-veyance reflects that $165,608.59 was deducted from her proceeds at the closing on account of the payoff of her mortgage with the Haverhill Cooperative Bank(A.64-68). Thus, instead of receiving this cash at the closing from the purchasers of her property, she was denied these funds on account of Fudge's refusal in 1988 to abide by the Separation Agreement. As Cerretani's attorney inform-ed Fudge in writing in 1996, he still owed her approximately $165,515.03 on the same terms as the original mortgage with the Haverhill Cooperative Bank, i.e., a variable rate promissory note based upon a yearly index of the average yield in the United States Treasury One-Year Constant Maturity Securities.

In an effort to provide some predictability for Fudge about his payments, Cerretani suggested a change from a variable rate of interest to a fixed rate; and the parties beginning in November of 1996 agreed to an amortization schedule by which Fudge paid 9%interest on the monies he owed Cerretani for the first year (or a monthly payment to her of $1,389.78) and, after Cerretani acceded to Fudge's request for a lesser interest rate, 7% interest for years 2 through 15 (or a monthly payment of $1531.81)(A.82-83;98-102). This was roughly the same rate of interest which Fudge would have had to pay a lending institution had he borrowed the $165,515.03 in 1996 to pay Cerretani this money which he owed her.

From November of 1996 through October of 1997, Fudge paid Cerretani $1,389.78 monthly and thereafter he paid her $1531.81 monthly consistent with this amortization schedule(A.83;86;98-101). After making 115 payments con-sistent with this repayment scheme, Fudge in June of 2007 willfully refused to make any more payments on this loan of money Cerretani made to him in 1991, leaving a principal arrearage of $68,538.13 (A.83;86;101).

On August 31, 2007, Cerretani brought a contempt complaint against Fudge for his refusal to pay her the remaining $68,538.13 and to obey the provisions of the contempt judgment of September 21, 1994, which inter alia obligated him to make Cerretani whole for the money owed her under the mortgage, an instrument which represented the amount of money Fudge owed Cerretani, “until said mortgage is paid in full”(A.15;53;69;87).

Fudge answered the complaint by denying any liability and by asserting in affirmative defenses that there was no outstanding clear and unequivocal order which required him to pay Cerretani $68,538.13; that the underlying mortgage was paid off in October of 1996, and no longer exists; and that as of June 2007, when he stopped paying Cerretani, he had already paid her $197,367.32 on the 1994 debt of $165,608.25 or an excess of $28,759.07 over the principal amount, representing a rough interest rate of 3%(A.71-73). As Fudge claimed in his Fourth Affirmative Defense, he

With the pleadings in this posture, the matter came on for hearing and argument by counsel in the Probate & Family Court Department before DiGangi, J., on December 4, 2007(A.16-17;77-102). After considering the arguments of the parties' respective counsel, the Probate Judge took the matter under advisement(A.96-97). On December 20, 2007, Judge DiGangi issued a judgment finding Fudge not guilty of civil contempt(A.17;74). In his rationale, the Probate Judge determined that there was not a clear and unequivocal of the Court with regard to the percen-tage of interest which Fudge was to pay Cerretani and that Fudge has paid the underlying amount back to Cerretani as ordered by the Court “plus a reasonable amount of interest”(A.74).

The Lower Court Erred In Finding Stephen D . Fudge Not Guilty Of Civil Contempt For His Failure To Pay Gail L. Cerretani's Mortgage “ In Full ” And Make Her Whole Based Upon His Admitted Refusal To Abide By His Promise In The Separation Agreement To Indemnify And Hold Her Harmless From Any Of The Liabilities Associated With His Refinancing / Division of the Marital Property .

Cerretani has reproduced in her Record Appendix the relevant pleadings, the Separation Agreement and all the prior orders and judgments which contain the findings and rulings addressing the issues which she has raised on this appeal. In addition, she has reproduced the hearing transcript containing the arguments of counsel on the contested issues. This Court therefore has a sufficient record upon which to rule whether Judge DiGangi erred when he refused to find Fudge in contempt for his refusal to pay Cerretani any further monies for the loan of $175,000.00 she made to him in 1988 in the form of the mortgage she was forced to purchase from the Haverhill Cooperative Bank in order to keep the marital home, property she should have received free and clear absent Fudge's defalcations under the Separation Agreement.

This Court is not obligated to reach the same conclusions of law which the Probate Judge reached below and it may accordingly reverse the judgment below if any of the lower court's rulings is tainted by error of law. Simon v. Weymouth Agricultural & Industrial Soc., 389 Mass. 146, 148-149(1983). Blackwell v. E.M. Helides, Jr., Inc., 368 Mass. 225, 226(1975). Lowell Bar Ass'n v. Loeb, 315 Mass. 176, 178 (1943).

Given this standard of review, Cerretani submits that the Probate Judge erred as a matter of law when he refused to find Fudge guilty of civil contempt under the terms of the parties' 1988 Separation Agreement for refusing to pay Cerretani's mortgage with the Bank “in full,” as specifically ordered by Judge Rockett in 1994, and thereby for failing to make Cerretani whole based upon Fudge's admitted failure to abide by his promise to indemnify and hold her harmless from any liabilities caused by his refinancing/division of the marital property.

Fudge neglected and refused to convey to Cerretani the subdivided 2-acre marital home free and clear of encumbrances, as he was obligated to do under the Separa-tion Agreement. He then refused and neglected to pay Cerretani the present-day value of the mortgage she was forced to obtain from the Bank in 1991 in order to keep the property, a financial undertaking by Cerretani which facilitated Fudge's ability to avoid liability on his own obligations to the Bank under the first mortgage for the sum of $680,000.00, an event which Judge Rockett found led to Fudge's subsequent ability to accumulate assets.

The fact that the “mortgage” Cerretani obtained in 1991 was discharged when she sold her parcel in 1996 is irrelevant. The debt running from Fudge to Cerretani which was represented by the mortgage loan was never discharged ; and it is this debt which Fudge under the Separation Agreement was bound to repay either in one payment or, if he chose to do so over time, with market-rate interest . Indeed, Fudge's subsequent 115 timely payments from November of 1996 through June of 2007 to Cerretani pursuant to a 15-year amortization schedule establish that the parties agreed upon a repayment protocol which encompassed an interest rate of 9% for the first year and 7% for the ensuing 14 years; and Fudge by his conduct has therefore waived any claim about interest or should be estopped from raising any claim that there was no agreement about interest.

Thus Fudge's refusal to abide by that agreed upon repayment protocol, to abruptly announce in June of 2007 that he had paid Cerretani the principal and “more than enough” interest on his debt, and then to refuse to make any further payments, leaving a principal arrearage of more than $68,000.00, violates the terms of the Separa-tion Agreement to indemnify and hold Cerretani harmless as well as Judge Rockett's 1994 contempt judgment which obligated him to pay Cerretani's mortgage “in full.”

Judge DiGangi's ruling excuses Fudge refusal to make further payments for the inexplicable reason that Fudge has paid enough interest, more than the principal amount loaned him by Cerretani in 1991, and impliedly finds that their 15-year repayment agreement is at an end in its eleventh year, a conclusion completely at odds with the parties' intent as expressed in the Separation Agreement and through their conduct over the years. It modifies the Separation Agreement in the absence of a change of circumstances and in the process deprives Cerretani of $68,000.00 worth of loan principal, ignoring the fact that Fudge as a debtor now has the benefit of a loan which no one—--including Cerretani—--could have possibly obtained on the open financial market. This result is unjustified by decisional law of this Court and unfair to Cerretani under any reading of the Separation Agreement.

This Court should accordingly reverse and vacate the judgment below which finds Fudge not guilty of civil contempt. In its place, a new judgment should enter finding that Fudge's willful refusal to continue paying Cerretani the money he forced her to borrow in 1988, with interest and pursuant to a repayment scheme agreed to by the parties following an express order from this Court in 1994, is contumacious and warrants the present award of such money to Cerretani as will make her whole, including an award of her attorney's fees and costs incurred at trial and on this appeal; or provide Cerretani with such other relief as is fair and just in the circumstances of this case.

This Court has consistently held that the Probate Judge has the jurisdiction, indeed the duty, under G.L.c. 215, § 6, to specifically enforce the terms of the par-ties' Separation Agreement and harmonize its provisions with any equitable division incident to a divorce. Stansel v. Stansel, 385 Mass. 510, 515 n.5(1982). Glick v. Greenleaf, 383 Mass. 290, 293-295(1981). The Separa-tion Agreement here awarded Cerretani the former marital home outright free and clear of all encumbrances together with two acres; Fudge was given the remaining 28 acres consisting of the horse farm and 6 buildable lots with Fudge being responsible for paying off the $680,000.00 first mortgage on the entire parcel. Each party agreed to indemnify and hold the other harmless from liabilities connected with their respective responsibilities under the Agreement.

Separation agreements such as this one are valid contracts in Massachusetts and are subject to the general principles of contract law, including those rules of construction invoked when their terms are challenged for their meaning. Hills v. Shearer, 355 Mass. 405,408(1969). Mansur v. Clark, 25 Mass. App. Ct. 618, 620(1988). Cepek v. Cepek, 22 Mass. App. Ct. 331, 333(1986). When such an agreement sets forth the parties' respective obliga-tions, its language, if plain and unambiguous, will be construed in accordance with its ordinary and usual sense. Larson v. Larson, 28 Mass. App. Ct. 338, 340 (1990). Kotler v. Spaulding, 24 Mass. App. Ct. 515,516-517(1987). In such a case, the agreement's language would provide the kind of clear and unequivocal command which would support a finding of contempt if Fudge had disobeyed its provisions. Larson, 28 Mass. App. Ct. at 342-343.

Employing these principles, the parties' bargain here in the event that either or both of them created liability in carrying out their respective undertakings pursuant to the Separation Agreement could not have been more clear. Each was bound to indemnify and hold the other harmless from any ensuing liability. When Fudge failed to refinance the Bank's first mortgage of $680,000.00, it forced Cerretani to obtain a $175,000.00 mortgage from the Bank on her property which she should have received free and clear from any encumbrances under the Separation Agreement. Fudge was responsible for Cerretani's debt under the plain terms of the Separation Agreement.

Furthermore, if Fudge had any questions about his responsibility in this regard, the 1994 contempt judgment entered by Judge Rockett reinforced the Agreement's plain terms by finding Fudge in contempt for having willfully failed to obey the divorce judgment and its incorporated Separation Agreement by inter alia (1) neglecting and refusing to convey title to the marital home to Cerretani free and clear of encumbrances; and (2) neglecting and refusing to indemnify Cerretani from his liabilities and debts, specifically the Bank's first mortgage on the entire 30-acre parcel which included the former marital home(A.12-13;53-54).

There is no question that these orders contained within the 1994 contempt judgment issued by Judge Rockett recognized that under the Separation Agreement, Fudge was responsible for Cerretani's debt, expressed in the form of a mortgage to the Bank; that he could pay it off either in one payment to Cerretani or over time, paying interest (just like Cerretani was obliged to do when she borrowed the money from the Bank) for the privilege of doing so; and that this debt, expressed as a mortgage, was to be paid by Fudge “in full” before he could claim a discharge of this obligation. This plain language of the Separation Agreement, reinforced by Judge Rockett's 1994 contempt judgment, therefore reflects the parties' intention to have each party solely responsible for performing their own respective undertakings incident to their divorce (and the Separation Agreement) and to indemnify and hold harmless the other should either of them fail to perform their duties thereunder.

Where a separation agreement is fair and reasonable, free from fraud or coercion and its provisions create no risk that either spouse will be become a pubic charge, it is valid and specifically enforceable. Knox v. Remick, 371 Mass. 433, 437(1976). Hills v. Shearer, 355 Mass. 405, 408-409(1969). Reeves v. Reeves, 318 Mass. 381, 384(1945). Schillander v. Schillander, 307 Mass. 96, 98 (1940). Just as a change in circumstances after the contract's execution will not modify or condition the performance of a surviving agreement, Surabian v. Surabian, 362 Mass. 342, 345-347 (1972) (remarriage of former spouse); Abrams v. Burg, 367 Mass. 619-621(1975)(a husband's bankruptcy); Schillander v. Schillander, supra (the financial reverses of one of the parties), the fact that Fudge was unable to secure a refinancing of the Bradford premises and then unilaterally decided to stop paying Cerretani the money she effectively loaned him in 1991 when she was forced to obtain a mortgage is no reason in law to deny Cerretani now the benefit of the bargain she struck with Fudge in the Separation Agreement at the time of the divorce. Cerretani is entitled to the enforcement of its freely bargained for provisions by finding Fudge in contempt and Judge DiGangi's refusal to do so is error.

In the absence of fraud, one who knowingly and voluntarily executes a surviving separation agreement is bound by its terms, Gifford v. Gifford, 354 Mass. 247, 248(1968); Canney v. New England Telephone & Telegraph Co., 353 Mass. 158, 165(1967); Markell v. Sidney B. Pfeifer Foundation, Inc., 9 Mass. App. Ct. 412, 440 (1980), and there was no evidence adduced by either of the parties below---or comes from the document itself----to infer that their intent was to excuse the other from the performance of their duties simply because one of them decided that he had paid too much interest on a loan or because he thought his 115 payments of principal and interest over the course of the loan had exceeded the loan's principal. See Parrish v. Parrish, 30 Mass. App. Ct.78,82-87(1991). Instead, all the proof below showed that the parties expected that either one of them would have to pay market-rate interest over the life of any loan which he/she had caused the other to make and for which he/she was bound to repay.

B. A Clear and Unequivocal Outstanding Order and Fudge's Willful Refusal To Obey The Order.

Before a judgment of civil contempt could enter against Fudge, there must be an undoubted disobedience of a clear and unequivocal order or command. Judge Rotenberg Educ. Ctr., Inc. v. Commissioner of the Dep't of Mental Retardation (No.1) , 424 Mass. 430, 449-451(1997). Bird v. Capital Site Management Co., 423 Mass. 172, 178(1996). Bisienere v. Buccino, 36 Mass. App. Ct. 749, 753-754 (1994) quoting Larson v. Larson , 28 Mass. App. Ct. at 340. Cerretani submits that the plain terms of the parties' incorporated surviving Separation Agreement in 1988 together with Judge Rockett's reinforcing 1994 contempt judgment clearly ordering Fudge to pay the debt represented by Cerretani's mortgage “in full” constitute such a clear an unequivocal order or command. Larson v. Larson, 28 Mass. App. Ct. at 342-343.

In addition, G.L.c. 215, Section 34A, provides inter alia that a judgment of contempt shall enter “for failure to comply with an order or judgment for monetary payment....”(emphasis supplied). This wording reflects the established decisional law of this Court that there can be no present or past contempt unless there is a positive showing that the alleged contemnor violated a clear and unequivocal outstanding order or judgment. Bird v. Capital Site Management Co., 423 Mass. 172, 178(1996). Warren Gardens Housing Cooperative v. Clark, 420 Mass. 699, 701(1995). Diver v. Diver, 402 Mass. 599, 402(1988). United Factory Outlet, Inc. v. Jay's Stores, Inc ., 361 Mass. 35, 36-37(1972). Larson, 28 Mass. App. Ct. at 340. Hinds v. Hinds, 4 Mass. App. Ct. 63, 66-67(1976).

Fudge did just that when in June of 2007 he repudiated the repayment protocol established by the parties' amortization schedule and announced that he had paid “more than enough” interest, had made total payments exceeding the loan's principal and was therefore no longer obligated to repay this loan to Cerretani. His self-serving rationale ignores the nature of his debt to Cerretani and his voluntary election to repay this loan over the course of fifteen years rather than immed-iately, a choice which brings with it the obligation of interest. Like any debtor who chooses to repay a loan over time, including Cerretani when she was forced to obtain a mortgage from the Bank, Fudge was bound to pay Cerretani market-rate interest, the kind of market-rate interest Cerretani had to pay the Bank for her mortgage loan which Fudge's defalcations caused.

Interest is paid as compensation for delay in the repayment of a loan. Trinity Church in the City of Boston v. John Hancock Mutual Life Ins. Co., 405 Mass. 682, 684(1989) citing Murphy's Case, 352 Mass. 233, 234-235(1967). It compensates the lender for the loss of the use of money during the time that the debtor is repaying the loan. Connecticut Valley Sanitary Waste Disposal, Inc. v. Zielinski, 436 Mass. 263, 270-271(2002) citing City Coal Co. of Springfield v. Noonan, 434 Mass. 709, 716 (2001) and Makino, U.S.A., Inc. v. Metlife Capital Credit Corp., 25 Mass. App. Ct. 302, 320-321(1987).

G.L.c. 231, Section 6C, reflects this principle of delay in payment and provides that in “all actions based on contractual obligations” which results in a “judgment for pecuniary damages,” interest shall be added to the judgment at the rate specified in the contract or, if not so specified, at the rate of 12% per annum from the date of the breach or demand. In addition, if the date of the breach or demand is not established, then interest is to be added at the contract rate or at the rate of 12% per annum “from the date of commencement of the action.”

As this Court recently observed in J.C. Higgins Com-pany, Inc. v. Bond Bros. Inc., 58 Mass. App. Ct. 537, 539 (2003), Section 6C's purpose is “to compensate a party for the loss of use, or unlawful detention, of money after the date that payment is due.” Id. citing Perkins Sch. for the Blind v. Rate Setting Commn., 383 Mass. 825, 835(1981). The aim is that a party wrongfully deprived of the use of money “should be made whole for his loss.” Sterilite Corp. v. Continental Casualty Co., 397 Mass. 837, 841(1986) quoting Perkins, supra .

In the same sense, when Fudge's failure to perform his undertakings under the Separation Agreement caused Cerretani to obtain a $175,000.00 mortgage, it was, in effect, a loan by Cerretani to Fudge of this amount. As Judge Rockett ruled in 1994, his indemnification and hold harmless promises to Cerretani obligated him either to repay her immediately or to pay her back over time with interest, the same kind of interest Fudge would have to pay for borrowing this money in 1996. The fact that Cerretani eventually paid off the Bank's mortgage in 1996 did not extinguish Fudge's debt to Cerretani which this mortgage represented and Judge Rockett was right to redress Fudge's contempt in 1994 by ordering him either to pay her back immediately the total sum due or over time with interest. Any other result would have rewarded Fudge with a windfall for the unnecessary delay he caused in repaying this loan and unfairly punished Cerretani financially for events over which she had no control.

C. Fudge Has Waived or Is Estopped From Claiming
Any Relief From the Repayment Protocol Which
He and Cerretani Agreed To In 1996.

Waiver is the intentional relinquishment of a known right. Rose v. Regan , 344 Mass. 223, 229(1962) and cases cited. It may be manifested by acts as well as by words.

Porter v. Harrington, 262 Mass. 203, 207(1928). Boyden v. Hill, 198 Mass. 477, 484-485(1908). Thus parties to a course of dealing may waive objection to its conditions orally, by their own actions, or in writing. Gouzoulas v. F.W. Stock & Sons, 223 Mass. 537, 539(1916). Martiniello v. Bamel, 255 Mass. 25, 28 (1926).

In McCarthy v. Tobin , 429 Mass. 84, 88-89(1999), the High Court found that a seller had waived the deadline for an extension of the parties' land agreement when his lawyer did not object to the passing of the time set for closing and when he continued to deal with the buyer's lawyer in order to craft a mutually satisfactory agreement. Id . at 89 citing Church of God in Christ, Inc. v. Congregation Kehillath Jacob, 370 Mass. 828, 834 (1976)(oral extension, acceptance of payments and contin-ued dealings signified waiver). Accord, Porter v. Harrington, 262 Mass. at 207-208(party who without objection adopts protocol of repayment waives objection thereto).

Here both Fudge and Cerretani established in 1996 an order of business by which Fudge repaid Cerretani the loan consistent with an amortization schedule which included a 9% interest rate for the first year and a 7% interest rate for the next fourteen (14) years. His 115 payments since 1996 consistent with this scheme consti-tute a waiver of his self-serving claim in 2007 that this repayment protocol was somehow unfair to him or a windfall for Cerretani.

Similarly, equitable estoppel is a principle created to prevent one from benefitting from his own wrongdoing and to avoid injustice or “results contrary to good conscience and fair dealing....” Mackeen v. Kasinskas, 333 Mass. 695, 698(1956) quoting McLearn v. Hill, 276 Mass. 519, 524(1931). Reflecting this principle, Fudge should be estopped by his own conduct from now claiming that he should be excused from paying any further principal and interest on this loan from Cerretani.

D. Judge DiGangi's Ruling Unilaterally Modifies the Parties' Separation Agreement in the Absence of a change in Circumstances.

The Probate Judge had no authority to modify the parties' Separation Agreement so that he nullifies its terms and frustrates its purpose. Winslow v. Winslow, 26 Mass. App. Ct. 1002(1988). Mansur v. Clark, 25 Mass. App. Ct. 618, 620(1988). DeChristofaro v. DeChristofaro, 24 Mass. App. Ct. 231, 235-236;239(1987). See also Ratchford v. Ratchford, 397 Mass. 114, 116(1986). Yet this is precisely the effect of the ruling below.

Judge DiGangi's determination that despite the terms of the Separation Agreement and Judge Rockett's prior contempt judgment against him, Fudge had paid enough interest and is now excused from any further payments of the loan's outstanding principal constitutes a modifi-cation of the divorce judgment unjustified by any change of circumstances. To be successful in an action to modify a divorce judgment, Fudge had to demonstrate a material or substantial change of circumstance since the entry of the earlier judgment, i.e., an alteration of a funda-mental fact which was not contemplated by the parties when they executed their separation agreement. Bercume v. Bercume, 428 Mass. at 643-644. Downey v. Downey, 55 Mass. App. Ct. 812, 815-817(2002). Fugere v. Fugere, 24 Mass. App. Ct. 758, 759-760(1987).

Not only has he failed to adduce such proof, he has failed even to file a complaint seeking such relief and this procedural impropriety alone prevents the lower court from making the ruling which it did. See Department of Revenue v. W.Z., 412 Mass. 718, 721-722(1992)(no authority to award modification without a complaint seek-ing such relief prospectively). Smith-Clarke v. Clarke, 44 Mass. App. Ct. 404, 405(1998)(same).

For all of the reasons identified herein, this Court should reverse and vacate the judgment below which finds Fudge not guilty of civil contempt. In its place, a new judgment should enter finding that Fudge's willful refusal to continue paying Cerretani the money he forced her to borrow in 1988, with interest and pursuant to a repayment scheme agreed to by the parties following an express order from this Court in 1994, is contumacious and warrants the present award of such money to Cerre-tani as will make her whole, including an award of her attorney's fees and costs incurred at trial and on this appeal; or provide Cerretani with such other relief as is fair and just in the circumstances of this case.