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Opinions – Maryland Court of Special Appeals: 3/7/11

Criminal Procedure

Reach-in searches

BOTTOM LINE: Where, police partially exposed defendants’ buttocks during searches incident to their arrests, searches were reasonable because they were “reach-in” rather than strip searches.

CASE: Allen v. State, Smith v. State, Nos. 1963, 1968, Sept. Term, 2009 (filed Feb. 4, 2011) (Judges Wright, GRAEFF & Davis (retired, specially assigned)). RecordFax No. 11-0204-00, 20 pages.

FACTS: In March of 2008, a Baltimore City police detective was patrolling a drug-prone location when he observed a group of men, including Octavian Allen and Drew Smith, standing on a street corner. The detective had previously arrested Smith for drug distribution on the same block. As cars passed by, the men shouted, “We got the fat 20’s here.” Based on his training and experience, the detective understood “fat 20’s” to be a term used to refer to $20 worth of cocaine.

The detective watched as a truck pulled up to the corner where the men were standing. The detective observed Allen approach the truck and engage the driver in a brief conversation. The driver gave Allen some money, and Allen gave the driver some small objects from his sleeve. Believing that the men were participating in a narcotics transaction, the detective called an arrest team to stop the truck and arrest the group of men.

During a search of Allen incident to arrest, a police officer pulled Allen’s pants and underwear away from his waist, and noticed a plastic bag near Allen’s buttocks. The officer reached in and removed the bag, which contained 28 orange ziplock bags filled with cocaine.

Another detective asked Smith if he had “anything illegal on him.” Smith responded that he had some marijuana. The detective recovered marijuana from Smith’s coat pocket and arrested him. The detective also noticed a bag in Smith’s buttocks area. The detective reached in and withdrew the bag, which contained 24 ziplock bags filled with narcotics.

Allen and Smith filed a motion to suppress the drugs on the grounds that the searches were not reasonable under the Fourth Amendment. Smith also asserted that the police did not have probable cause to arrest him. The circuit court denied the motions and found Allen and Smith guilty of distribution of cocaine.

Allen and Smith appealed to the Court of Special Appeals, which affirmed.

LAW: Police are allowed to conduct a search incident to an arrest to remove weapons or to search for and seize any evidence on the arrestee’s person in order to prevent its concealment or destruction. Paulino v. State, 399 Md. 341 (2007). The question here was whether a strip search, or a “reach-in” search, is a reasonable search incident to arrest.

The Supreme Court has addressed the reasonableness of a strip search in connection with pretrial detention. Bell v. Wolfish, 441 U.S. 520 (1979). “The test of reasonableness under the Fourth Amendment is not capable of precise definition or mechanical application. In each case it requires a balancing of the need for the particular search against the invasion of personal rights that the search entails. Courts must consider the scope of the particular intrusion, the manner in which it is conducted, the justification for initiating it, and the place in which it is conducted.” Bell, 441 U.S. at 520.

Maryland courts have applied this analysis in addressing claims regarding the reasonableness of a strip search incident to arrest. See Paulino, 399 Md. at 359-60 (strip search and visual body cavity search unreasonable when conducted in a well-lit public car wash); Nieves, 383 Md. at 596, 861 (strip search incident to arrest for a minor traffic violation unreasonable because the offense precipitating the arrest did not create reasonable suspicion that the defendant possessed weapons or drugs). These cases make clear that a strip search is not the type of search that the police may conduct automatically incident to arrest; rather, the reasonableness of such a search is determined by consideration of the four-factor test set forth by the Supreme Court in Bell. See Paulino, 399 Md. at 355; Nieves, 383 Md. at 588.

Thus, in this case, the first issue that was necessary to address was whether the searches were strip searches. The State contended that they were not because the defendants’ clothing was not removed nor were any of their private body parts or the buttocks publicly exposed. According to the State, the searches were “reach-in” searches, a search defined as one that “involves a manipulation of the arrestee’s clothes such that the police are able to reach in and retrieve the contraband without exposing the arrestee’s private areas.” Paulino, 399 Md. at 360 n. 6.

Allen and Smith contended that the searches were strip searches, not “reach-in” searches, arguing that a “reach-in” search does not expose the arrestee’s private area, and the police here inspected appellants’ bare buttocks during the searches. They further argued that, regardless of how the searches were classified, the searches were unreasonable under the test set forth by the Supreme Court in Bell.

Given the conflicting definitions of the term “strip search,” the dispute between the parties regarding whether the searches were “strip searches” was not surprising. In Nieves, the Court stated that “strip searches involve the removal of the arrestee’s clothing for inspection of the under clothes and/or body.” Nieves, 383 Md. at 586. In contrast, in Paulino, a strip search was defined as “any search of an individual requiring the removal or rearrangement of some or all clothing to permit the visual inspection of the skin surfaces of the genital areas, breasts, and/or buttocks.” Paulino, 399 Md. at 352-53.

However, whether a “reach-in” search such as searches conducted of Allen and Smith was classified as a strip search was not dispositive of its reasonableness. Although a “reach-in” search may be less invasive than a search requiring a suspect to remove his or her clothing, to the extent that it allows an officer to view a person’s private areas, a “reach-in” search is still intrusive and demeaning. See State v. Stone, 362 N.C. 50 (N.C. 2007) (search of intimate areas violates social expectations; “areas are referred to as ‘private parts’ for obvious reasons”). For this reason, regardless of whether it is classified as a strip search, a “reach-in” search or other search inside a person’s clothing, a search which permits the officer to view a suspect’s private areas is not the type of search that automatically is allowed as a search incident to arrest. Rather, the analysis for a strip search incident to arrest applies, and the reasonableness of a reach-in search is to be determined by reference to the four factors set forth by the Supreme Court in Bell: 1) the scope of the particular intrusion; 2) the manner in which it is conducted; 3) the justification for initiating it; and 4) the place in which it is conducted. Bell, 441 U.S. at 559.

Addressing first the justification for the search, a strip search incident to arrest may be conducted only if there is reasonable suspicion to believe that drugs are concealed on the suspect’s body. Nieves, 383 Md. at 596. The same justification is required for a “reach-in” search. See Safford Unified School District # 1 v. Redding, —-U.S. ——, —— (2009) (school search that goes beyond “outer clothes and backpacks to exposure of intimate parts” requires reasonable suspicion that evidence concealed under clothing).

Here, the searches were justified because they were incident to a lawful arrest for narcotics distribution, and it was reasonable for the police to believe that Allen and Smith were concealing drugs on their persons. Moreover, it is “well known in the law enforcement community, and probably to the public at large, that drug traffickers often secrete drugs in body cavities to avoid detection.” Moore v. State, —-Md. ——, No. 1759, Sept. Term, 2007, slip op. at 22 (filed Oct. 29, 2010). This knowledge supports the holding that, when a person is arrested for drug dealing, the nature of the offense provides reasonable suspicion to believe that the arrestee is concealing drugs on his or her person. See United States v. Barnes, 506 F.3d 58, 62 (1st Cir. 2007).

The next two factors in the Bell test, the scope and manner of the searches, were then considered. Although a “reach-in” search that exposes a person’s private area is invasive, and therefore not automatically permitted as a search incident to arrest, it is less invasive than a full strip search. Here, the police officers merely pulled the suspects’ pants and underwear away from their waist, at which point the police observed a plastic bag protruding from the suspects’ buttocks. The suspects’ clothing was not removed, the private areas of their bodies were not publicly exposed, and the officers took steps to protect their privacy. In each case, the officer stood directly behind the suspect, and was the only one who could see the suspects’ buttocks during the search. Thus, the scope and manner of the searches were not unreasonable.

The final factor to be considered in the Bell analysis was the reasonableness of the location of the search, which was a public area. A “reach-in” search may be reasonable under the Fourth Amendment, even if it occurs in a public place, if the police take steps to protect the suspect’s privacy. See Williams, 477 F.3d at 977 (“reach-in” search of defendant’s pants in police parking lot was reasonable where precautions were taken by the officers to prevent viewing by passersby).

Here, the searches were conducted on a public street. However, the searches were conducted out of public view, in front of storage garages, not homes, and there were no civilians in the area. Indeed, testimony indicated that the officers took precautions to protect the suspects’ privacy, and the searches were conducted so that no one, other than the searching officer, could have observed appellants’ buttocks.

In contrast to Paulino, where the police conducted a search in the bay of a car wash, Paulino, 399 Md. at 360, the searches of Smith and Allen were not as highly invasive. Rather, they were brief and conducted in a manner such that the suspects’ private areas were not publicly exposed. Thus, balancing the four Bell factors, the searches in this case were reasonable under the Fourth Amendment.

Accordingly, the judgment of the circuit court was affirmed.

COMMENTARY: The other issue was whether the arrest of Smith was supported by sufficiently particularized probable cause.

The rule of probable cause is a non-technical conception of a reasonable ground for belief of guilt, requiring less evidence for such belief than would justify conviction but more evidence than that which would arouse a mere suspicion. Doering v. State, 313 Md. 384, 403 (1988). Probable cause exists where the facts and circumstances within the officer’s knowledge and of which he had reasonably trustworthy information would justify the belief of a reasonable person that a crime has been or is being committed. See Beck v. Ohio, 379 U.S. 89, 91 (1964).

Here, police clearly had probable cause to arrest Smith. Experienced police officers observed a suspicious transaction in a drug-prone area and even heard the suspects advertising their “fat 20’s.” Moreover, Smith admitted that he had marijuana in his pocket.

PRACTICE TIPS: Regardless of whether it is classified as a strip search or as a “reach-in” search, any search inside a person’s clothing, which permits the officer to view a suspect’s private areas, is not the type of search that is automatically allowed as a search incident to arrest. Rather, the reasonableness such a search is to be determined by considering the scope of the particular intrusion, the manner in which it is conducted, the justification for initiating it, and the place in which it is conducted.

Criminal Procedure

Restitution

BOTTOM LINE: Because a reasonable person in the defendant’s position would have understood the plea agreement as leaving open the possibility of restitution in the criminal proceeding, the trial court’s order of restitution did not constitute a breach of the defendant’s plea bargain.

CASE: Lafontant v. State, No. 1228 Sept. Term, 2008 (filed Feb. 3, 2011) (Judges EYLER, J., Hotten & Moylan. (retired, specially assigned)). RecordFax No. 11-0203-00, 24 pages.

FACTS: Joseph Lafontant, driving under the influence of alcohol, struck an oncoming vehicle, killing 12-year-old Brianna Stanton. Brianna’s grandmother was driving. Lafontant was charged with nine counts, including manslaughter by vehicle or vessel under CL §2-209.

Lafontant entered into a plea agreement with the State, in which he promised to plead guilty to the charge of vehicular manslaughter and the State assured Lafontant that it would seek no more than four years of active incarceration. Lafontant was thus convicted of vehicular manslaughter.

Before the sentencing hearing, the grandmother retained counsel through the Maryland Crime Victim’s Resource Center. Counsel advised the grandmother of her right to request restitution under CP §11-603(b), and prepared a written request that the trial court order Lafontant to pay her $11,977.

The request was not filed until the date of the sentencing hearing. Defense counsel objected that restitution was not part of the plea agreement. The court then sought confirmation as to whether Lafontant wished to withdraw his guilty plea, given the unexpected request for restitution.

The court decided not to rule on the restitution request in order to allow defense counsel to discuss it with his client, and to permit the parties and counsel for the grandmother to supply the court with authority for and against the request. The court then sentenced Lafontant to a ten-year prison term with all but four years suspended, plus probation.

Following the sentencing, Lafontant and the grandmother could not agree on the issue of restitution. A restitution hearing was therefore held, at which the court ordered Lafontant to pay restitution as a condition of probation.

Lafontant appealed to the Court of Special Appeals, which affirmed.

LAW: Under CP §11-603(a), “a court may enter a judgment of restitution that orders a defendant … to make restitution in addition to any other penalty for the commission of a crime if … as a direct result of the crime or delinquent act, the victim suffered: (i) actual medical, dental, hospital, counseling, funeral, or burial expenses or losses; (ii) direct out-of-pocket loss; (iii) loss of earnings; or (iv) expenses incurred with rehabilitation.” Subsection (b) of CP §11-603 makes it clear that restitution is in fact a right held by victims and, in a criminal proceeding, can be requested by either the victim or the State.

Generally, courts may impose restitution as either a condition of probation or as part of a sentence. Goff v. State, 387 Md. 327, 338-39 (2005). However, if a court entering a judgment of restitution to a victim under CP §11-603 does elect to order a period of probation, “compliance with the judgment of restitution … shall be a condition of probation … in addition to a sentence or disposition.” CP §11-607(a)(1).

CP §11-615(a) sets out the procedure by which victims can present the court with competent evidence of their losses. A court need not issue a judgment of restitution if the court finds “(1) that the restitution obligor does not have the ability to pay the judgment of restitution; or (2) that there are extenuating circumstances that make a judgment of restitution inappropriate.” CP §11-605(a).

“An order of restitution entered in a criminal case, even when attached as a condition of probation, is a criminal sanction-part of the punishment for the crime.” Chaney v. State, 397 Md. 460, 470 (2007).

Because plea agreements are similar to contracts, “contract principles should generally guide the determination of the proper remedy of a broken plea agreement.” Solorzano v. State, 397 Md. 661 (2007). “In considering whether a plea agreement has been violated … the terms of the plea agreement are to be construed according to what a defendant reasonably understood when the plea was entered.” Tweedy v. State, 380 Md. 475, 482 (2004).

To determine “a defendant’s reasonable understanding of the agreement at the time he entered into it, we consider terms implied by the plea agreement as well as those expressly provided.” Id. “Fairness and equity” govern the enforcement of plea agreements so that when a plea agreement rests on a promise as to disposition, the promise must be fulfilled. Cuffley v. State, 416 Md. 568 (2010).

Maryland has a strong public policy in favor of affording crime victims meaningful rights and fair treatment within the criminal justice system. Hoile v. State, 404 Md. 591, 605 (2008). See also Article 47(a) and (b) of the Maryland Declaration of Rights. Maryland also affords crime victims an expansive set of statutory rights, which echoes the constitutional rights. See, e.g., CP §11-102, CP §11-104(b), CP §11-403, and CP §11-603.

On the other hand, a criminal defendant is entitled to enforcement of a plea agreement if accepted by the court. That principle is grounded in the Due Process Clause and the well-established rule that, to be valid, a guilty plea must be both voluntary and intelligent. Mabry v. Johnson, 467 U.S. 504, 508-09 (1984).

To decide whether the circuit court breached the plea agreement, the first issue was what the plea agreement included, and—perhaps more importantly—what the plea agreement did not include.

Lafontant agreed to plead guilty to vehicular manslaughter, and, in return, the State agreed to request no more than four years of active incarceration. The State did not expressly require that Lafontant pay restitution as part of the plea agreement. Neither did the State expressly waive the right to request restitution, either by it or by the victim directly. The question thus became whether the State, by failing to expressly include the issue of restitution in the agreement, effectively waived the victim’s right to request restitution.

Lafontant could not reasonably have believed that the terms of the bargain impliedly waived the victim’s right to restitution. Even if Lafontant might have understood the State was impliedly waiving its right to request restitution, Lafontant should reasonably have understood that the victim was not. Accordingly, the agreement contained neither an express nor an implied waiver of the victim’s right to restitution in a criminal and/or civil proceeding.

The plea agreement was not for a specific sentence and was not even for a recommendation of a specific sentence. The agreement was that the State would recommend a sentence that would include no more than four years active incarceration.

At the time of the bargain, Lafontant should have understood that four years of active, unsuspended incarceration would implicate a period of probation. Rankin v. State, 174 Md.App. 404, 411-12 (2007). At the plea hearing, Lafontant was expressly informed by the court that, if he pled guilty, he might be sentenced to a period of probation. Lafontant did not object, indicating that he understood probation was a possibility and was not precluded by the plea agreement.

Further, it is well understood that the terms and conditions of probation are largely within the trial court’s discretion. See CP §6-221; State v. Wooten, 27 Md.App. 434, 335 (1979). Moreover, restitution is known to be a standard condition of probation. See Lafave et al., Criminal Procedure §26.9(b). Indeed, the record contained the circuit court’s Probation/Supervision Order form, which sets forth a checklist of (A) Standard Conditions, and (B) Special Conditions and specifically states: “10. Pay all fines, costs, restitution, and fees as ordered by the court or as directed by your supervising agent through a payment schedule.”

Thus, Lafontant should reasonably have known that the court could impose a period of probation, and that one of the conditions might be restitution, if requested by the victim. Lafontant understood that the one and only term in his plea agreement was that the State would not recommend more than fours years active incarceration.

Accordingly, the circuit court did not breach the terms of the agreement when it ordered Lafontant to pay restitution to the victim’s representative.

COMMENTARY: Because the agreement did not in fact preclude restitution, the Court did not address the victim’s representative’s claim that, by declining to withdraw his guilty plea, Lafontant waived his right to argue that the agreement does preclude restitution. Nevertheless, if the Court had held that the order of restitution violated the plea agreement, the fact that Lafontant declined to withdraw from the agreement when the question of restitution first arose, after the plea agreement had been accepted, would be of no consequence.

In Solorzano, the Court of Appeals held that “when either the prosecution breaches its promise with respect to a plea agreement, or the court breaches a plea agreement that it agreed to abide by, the defendant is entitled to relief.” 397 Md. at 667-68. Specifically, “where the plea agreement is breached, and it was not caused by the defendant, the general remedy for the breach is to permit the defendant to choose either specific performance or withdrawal of the plea.” Id. at 668.

Therefore, if restitution had been a violation of the plea agreement, Lafontant would have had the option to pursue enforcement of the agreement as it stood before the breach, rather than withdrawing when the victim’s representative requested restitution. By choosing the option of specific performance, Lafontant would not have waived his ability to argue the merits of the breach.

PRACTICE TIPS: Having determined that restitution is a form of punishment, the Court of Appeals set forth three requirements that must be met before restitution may be imposed: “(1) the defendant [must be] given reasonable notice that restitution is being sought and the amount that is being requested, (2) the defendant [must be] given a fair opportunity to defend against the request, and (3) there [must be] sufficient admissible evidence to support the request—evidence of the amount of a loss or expense incurred for which restitution is allowed and evidence that such loss or expense was a direct result of the defendant’s criminal behavior.” Chaney v. State, 397 Md. 460, 470 (2007).

Criminal Procedure

Voir dire

BOTTOM LINE: There was no plain abuse of discretion in trial court’s voir dire questioning of a panel of prospective jurors en masse and, in any case, no extraordinary circumstances were present to invoke appellate review of defendant’s unpreserved claim of plain error.

CASE: Frazier v. State, No. 1472, Sept. Term, 2009 (filed Feb. 3, 2011) (Judges Hollander, WRIGHT & Raker (retired, specially assigned)). RecordFax No. 11-0203-02, 28 pages.

FACTS: Robert Frazier was indicted in the circuit court for Baltimore City and charged with distribution of cocaine, possession with intent to distribute cocaine, and possession of cocaine.

Before voir dire, the trial judge explained the voir dire process to the venire as a group. The court then asked the venire four sets of questions, each containing multiple components. Next, the court informed the venire about the burden of proof in a criminal case. Finally, the court stated that if anyone had anything else they wanted to inform the court, including any scheduling issues, “please bring it to our attention.”

After asking the prosecutor and defense counsel if he missed “any important questions,” and after both attorneys responded in the negative, the court heard individually from 18 members of the venire. Then, the court entertained challenges for cause from the attorneys and excused 31 of the prospective jurors. The attorneys then proceeded to select a jury and both parties used all of their peremptory strikes.

The jury convicted Frazier on all counts. He was subsequently sentenced to fifteen years imprisonment for distribution of cocaine.

Frazier appealed the conviction to the Court of Special Appeals, contending that the trial court’s voir dire procedure violated the decision of the Court of Appeals in Wright v. State, 411 Md. 503 (2009). Acknowledging that defense counsel did not object to the voir dire, Frazier asked the Court of Special Appeals to recognize plain error.

The Court of Special Appeals declined to recognize plain error and affirmed the Circuit Court’s decision.

LAW: The overarching purpose of voir dire in a criminal case is to ensure a fair and impartial jury. Wright v. State, 411 Md. 503, 508 (2009); see also Drake and Charles v. State, 414 Md. 726 (2010). Without an adequate voir dire, the trial judge’s responsibility to remove prospective jurors who will not be able impartially to follow the court’s instructions and evaluate the evidence cannot be fulfilled. Stewart v. State, 399 Md. 146, 158 (2007).

The trial court has broad discretion in the conduct of voir dire. Wright, 411 Md. at 508; see also Moore v. State, 412 Md. 635 (2010) (“In the absence of a statute or rule prescribing the questions to be asked of the venirepersons during the examination, the subject is left largely to the sound discretion of the court in each particular case”). “That discretion extends to both the form and the substance of questions posed to the venire.” Wright, 411 Md. at 508.

In Wright, the Court of Appeals considered whether the trial court properly exercised its discretion by asking the venirepersons, as a group, a roster of seventeen questions. Id. at 506. After the collective questioning, each venireperson was called to the bench and asked “if he or she had any information in response to the voir dire questions” and “if he or she could be fair and impartial.” Id. Defense counsel objected, arguing that lumping all seventeen voir dire questions together frustrated the ability of the jurors to remember all of the questions. Id. at 507. The Court of Appeals agreed, explaining, “The presentation of a lengthy roster of questions to the venire, without providing the opportunity to answer each question as it was posed, required each venireperson to comprehend and retain far too much information to guarantee that the questions were answered properly.” Id. at 509. The Court noted that voir dire was “five and a half minutes of continuous questioning, without pause,” which “resulted in substantial delay between presentation of the questions and the answers.” Id. at 511-12. Accordingly, it was held that “the selected voir dire method may have obscured relevant information from the trial court’s view by failing to ensure that the jurors on the venire made reasonably full disclosures. The trial court was therefore working with an incomplete understanding of the jury pool.” Id. at 513.

The Wright Court, however, qualified its holding by stating, “We are not suggesting that asking questions to a venire panel en masse is an inherently flawed procedure. In this case, it is the multiplicity of the questions that is problematic, not the means by which the questions are broadcast. The key to an effective voir dire is allowing venirepersons the meaningful opportunity to digest the individual questions posed to them and to respond fully to each one while the question is at the forefront of their minds.” Id. at 514. In Wright, the issue was preserved by defense counsel’s objection at the conclusion of the voir dire. Id. at 507.

Here, a similar objection was not lodged. For this reason, Frazier asked the Court to consider the issue as plain error. As is well established, a court’s discretion to recognize plain error is plenary. See McMillan v. State, 181 Md.App. 298, 359 (2008) (“[W]hen a defendant fails to object, an appellate court possesses plenary discretion to notice plain error material to the rights of a defendant, even if the matter was not raised in the trial court”), cert. granted, 406 Md. 744. Further, an appellate court “will review the unpreserved claim only where the unobjected to error can be characterized as compelling, extraordinary, exceptional, or fundamental to assure the defendant a fair trial by applying the plain error standard.” Abeokuto v. State, 391 Md. 289, 327 (2006).

In James v. State, 191 Md.App. 233 (2010), the court declined to exercise plain error review for an unpreserved claim that was similar to the one raised in Wright. Although an appellate court may address an unpreserved issue to “communicate a desired message to the bench and bar that might otherwise go unsent,” McMillan, 181 Md.App. at 360, the Wright decision obviates the need for further appellate exploration of the issue of a trial judge’s discretion in conducting the voir dire process. Furthermore, the “error” of which Frazier complains was not “plain” at the time of trial in this case, as it has been held consistently that there is nothing improper about a trial judge’s questioning prospective jurors as a group. An error would not be “plain” unless it is wrong under current law. See United States v. Olano, 507 U.S. 725, 734 (1993).

At the time of the trial in the present case, Maryland’s appellate courts had yet to address whether the manner in which the voir dire was conducted was error. No extraordinary circumstances were present in the instant case to invoke the Court’s discretion to address an unpreserved claim of error that has since been addressed by the Court of Appeals. James, 191 Md.App. at 247. Frazier contended that James was distinguishable because, in that case, the court used the very same method used in Wright, whereas in the instant case, the trial court employed a different technique.

Here, Frazier’s trial began on June 5, 2009, with jury selection. Wright was subsequently decided on Nov. 16, 2009. Thus, any error in the voir dire procedure in this case was not plain under then-current law. James, 191 Md.App. at 247. Because no extraordinary circumstances were present in the instant case to invoke the Court’s discretion to address an unpreserved claim of error that has since been addressed by the Court of Appeals, James, 191 Md.App. at 247, plain error review was not warranted under the circumstances of this case.

Accordingly, the judgment of the circuit court was affirmed.

COMMENTARY: The next issue was whether the trial court abused its discretion in denying Frazier’s motion for a mistrial, based on a verbal exchange between Frazier and one of the courtroom sheriffs which occurred when Frazier approached an easel that the State had set up near the jury box. Frazier contended that the exchange, which occurred in the presence of the jury, prejudiced him by injuring the presumption of his innocence. Granting a mistrial is “an extraordinary act which should only be granted if necessary to serve the ends of justice.” Cooley v. State, 385 Md. 165, 173 (2005).

Whether to grant a request for a mistrial is left to the sound discretion of the trial court. Cooley, 385 Md. at 173. The determining factor is whether “the prejudice to the defendant was so substantial that he was deprived of a fair trial.” Kosh v. State, 382 Md. 218, 226 (2004). Control over courtroom security is within the “broad discretion” of the trial court. Cooley, 385 Md. at 182. “It is obvious that some security is necessary or desirable in most, if not all, criminal trials. It is equally obvious that not all security measures will result in prejudice to the defendant.” Bruce v. State, 318 Md. 706, 718 (1990). The fundamental rationale for the deference given is that “the trial judge is physically on the scene, able to observe matters not usually reflected in a cold record … The judge has his finger on the pulse of the trial.” State v. Cook, 338 Md. 598, 615 (1995).

Here, as the contact between Frazier and the sheriff’s deputy was a limited one, the extreme remedy of a mistrial was not warranted in this case. Thus, the trial court did not abuse its discretion in denying the motion for mistrial.

PRACTICE TIPS: To determine whether improper closing remarks by a prosecutor influenced the verdict, the court must consider the severity of the remarks, the measures taken to cure any potential prejudice, and the weight of the evidence against the accused. Instead of considering each improper statement independently, a court will consider the cumulative effect of all errors on the ability of a jury to render a fair and impartial verdict in the context of the case.

Real Property

Abatement of interest

BOTTOM LINE: Appellees were not responsible for interest accrued during the delay between the date set for final ratification of the foreclosure sale and the actual date of ratification since the delay was caused by the conduct of other persons beyond the power of appellees to control or ameliorate.

CASE: Zorzit v. 915 W. 36th Street, LLC, No. 978, Sept. Term, 2009 (filed Feb. 2, 2011) (Judges WOODWARD, Graeff & Davis (retired, specially assigned)). RecordFax No. 11-0202-00, 24 pages.

FACTS: Kalliopi and George LeVanis used to own three properties in Baltimore at 915, 917, and 919 West 36th Street. Each property was subject to a separate deed of trust in favor of the lender, Nick’s Amusements, Inc. Upon the former owners’ default, John Zorzit, the substitute trustee on the three deeds of trust, petitioned the circuit court for a decree for sale of the properties. Zorzit advertised the properties for sale at public auction. See Rule 14-210(a).

On June 30, 2008, 915 W. 36th Street, LLC and 919 W. 36th Street, LLC (collectively, the Purchasers), purchased the properties at the foreclosure sale for $1.2 million. In accordance with the terms of the sale, the Purchasers made a total deposit of $120,000, of which $50,000 was paid at the time of the foreclosure sale. The remaining balance of $1,080,000 was due at settlement.

After Zorzit filed a report of sale, the clerk of the circuit court issued a notice of sale on July 16, 2008, indicating that unless good cause to the contrary was shown by Aug. 15, 2008, the court would ratify the sale of the properties. See Rule 14-305(e).

On Aug. 15, 2008, the former owners filed exceptions to the foreclosure sale. On Oct. 31, 2008, the circuit court denied the exceptions and issued an order ratifying the sale of the properties. The settlement on the sale of the properties occurred on Dec. 8, 2008. The settlement statement indicated that the Purchasers paid $47,584.71 in interest at the closing.

The Purchasers filed a motion for abatement of interest in the circuit court on the ground that the ratification of the foreclosure sale was significantly delayed because of the exceptions filed by the former owners. The circuit abated the entire interest, in the amount of $47,584.

The Court of Special Appeals affirmed in part and reversed in part.

LAW: “Whether to abate the payment of interest by a [foreclosure sale] purchaser … is a decision entrusted to the discretion of the hearing judge.” Thomas v. Dore, 183 Md.App. 388, 405 (2008); Baltrotsky v. Kugler, 395 Md. 468, 477 n. 7 (2006).

Rule 14-202(a) authorizes the beneficiary of a deed of trust or any successor trustee, under power of sale or assent to a decree, to institute a foreclosure action upon default. Before making a sale of the property subject to the lien, the trustee must “publish notice of the time, place, and terms of sale in a newspaper of general circulation in the county in which the action is pending.” Rule 14-206(b)(1). For the sale of an interest in real property, the notice must be printed in the newspaper at least once a week for three successive weeks. Id. The trustee or a court-appointed substitute trustee thereafter conducts the foreclosure sale. Rule 14-207(b)(2).

After the sale is completed, the trustee must file a report of sale with the court. Rule 14-305(a). Once the report of sale is filed with the court, the clerk issues a notice containing “a brief description sufficient to identify the property and stating that the sale will be ratified unless cause to the contrary is shown within 30 days after the date of the notice.” Rule 14-305(c). Within this 30-day period, a party may file exceptions to the sale. Rule 14-305(d)(1).

A court will ratify the sale if the time for filing exceptions “has expired and exceptions to the report either were not filed or were filed but overruled, and … the court is satisfied that the sale was fairly and properly made.” Rule 14-305(e). After the court issues a final order of ratification, settlement takes place with the foreclosure purchaser.

In Donald v. Chaney, 302 Md. 465 (1985), purchasers at a foreclosure sale bought the property in accordance with the advertised terms of the sale. The sale was ratified by the [circuit court] on Dec. 17, 1982.

Settlement did not occur within 10 days from that date because the purchasers were unable to obtain financing for the unpaid balance of the purchase price. Id. at 473, 478. Creditors thereupon filed a petition to require the purchasers to pay interest on the unpaid balance of the purchase price for the period of delay, i.e., from Dec. 27, 1982 to the actual date of settlement. The trial court denied the creditors’ requested relief. Id. at 468.

The Court of Appeals stated: “[A] purchaser at a judicial sale will be excused from [the] requirement to pay interest upon the unpaid balance for the period between the time fixed for settlement and the date of actual settlement only when the delay [1] stems from neglect on the part of the trustee; [2] was caused by necessary appellate review of lower court determinations[;] or [3] was caused by the conduct of other persons beyond the power of the purchaser to control or ameliorate.” Id. at 477.

Finding none of the equitable considerations that would justify relieving the purchasers of the obligation to pay interest on the unpaid balance for the period of delay in settlement, the Court held that the trial court’s order relieving the purchasers of that obligation was clearly erroneous. Id. at 478.

In White v. Simard, 152 Md.App. 229 (2003), Simard made the winning bid of $53,000 at the foreclosure sale. Simard, however, failed to timely complete settlement, and the property was resold at Simard’s risk. Id. Simard again made the winning bid at the resale, this time for $101,141. Id. Although he again defaulted, this time Simard assigned his rights to substitute purchasers who successfully completed the sale. Id. at 238. The bid at the second sale created surplus proceeds, and Simard argued that he was entitled to that surplus under Maryland common law. The advertisement of sale, however, expressly provided that “[t]he purchaser shall not be entitled to any surplus proceeds or profits resulting from any resale of the property.” Id. at 237.

The Court of Special Appeals first observed that the “purchase and sale transaction at any judicial sale is governed by general principles of contract, with the court acting as vendor[.]” Id. at 241. The advertisement or notice of sale published by the trustee that sets forth the time, place, and terms of sale “become part of the contract that is made when the sale is ratified.” Id. at 244. Therefore, Simard was not entitled to the surplus proceeds of the resale of the property, because he knowingly bargained away that entitlement. Id. at 236, 247.

In Baltrotsky, the Court of Appeals addressed an issue left unresolved by the confluence of its opinion in Donald and the opinion in White. The owner of three residential properties, which were subject to a single deed of trust, defaulted on the loan secured by said deed of trust, and the trustee initiated a foreclosure action. Id. at 471. The foreclosure sale was held on Dec. 24, 2003, and each of the three properties was sold to a third-party purchaser. Id.

Beginning on Dec. 29, 2003, the owner began a litigation effort to avoid the sale and preserve his ownership in the properties. Id. at 472. Because of the delay occasioned by the owner’s protracted litigation, the trial court granted the foreclosure purchasers’ motions for abatement of interest on the purchase prices from the date of sale (Dec. 24, 2003) to the date of settlement. Id. at 473. The Court of Special Appeals affirmed the abatement of interest. Id. at 473-74.

The Court of Appeals first reaffirmed the common law rule recognized in Donald that a foreclosure sale purchaser must pay interest on the unpaid balance of the purchase price until actual settlement of the sale, but there are three equitable exceptions to that general rule. Donald, 302 Md. at 478. The Court then determined that the owner’s extensive efforts to void the sale placed the case directly within the third equitable exception, namely, the delay in achieving settlement on the sale was caused by the “conduct of other persons beyond the power of the purchaser to control or ameliorate.” Id. at 479.

Relying on White, however, the owner argued that the purchasers were contractually bound by the terms of sale contained in the advertisement, which provided for interest to be paid on the unpaid purchase money by the purchaser(s) from the date of sale to the date of settlement. Id. at 479-80. The Court recognizing that parties are bound by the express terms of a contract. Id. at 480. That general rule, was, however, subject to the caveat that “some countervailing public policy” may nonetheless justify “modify[ing] or excis[ing] certain terms of a contract” id., and that the owner’s conduct which delayed settlement on the properties justified modifying the terms of the contract. Id. at 480-81.

Finally, in Thomas, 183 Md.App. at 389, the purchaser successfully bid on the property at a foreclosure sale on Nov. 29, 2006. The clerk of the court issued a notice of the report of sale indicating that the circuit court would ratify the foreclosure sale unless good cause was shown by Jan. 7, 2007. Id. at 390. The ratification did not take place on time, but was delayed until March 23, 2007 because the owner mortgagor of the property filed exceptions to the sale. The ultimate settlement was thereby pushed back to April 12, 2007. Id. at 391.

The foreclosure purchaser moved to abate the interest that accrued on the unpaid purchase price between the anticipated ratification date (Jan. 8, 2007) and the actual date of ratification (March 23, 2007).

The published advertisement of the foreclosure sale stated that in the event settlement was delayed, there would be no abatement of the interest. Id. The circuit court denied the purchaser’s motion on the ground that the purchaser was contractually prohibited from receiving an abatement of interest payments. Id. at 398.

The Court of Appeals, however, found that the contractual provisions in an advertisement are “presumptively binding” and that presumption is rebuttable. Id.

Here, there were three separate and distinct time periods: the date of the foreclosure sale, June 30, 2008, to the initial date set for final ratification, Aug. 15, 2008 (Period One); the initial date set for final ratification, Aug. 15, 2008, to the actual date of final ratification, Oct. 31, 2008 (Period Two); and the actual date of final ratification, Oct. 31, 2008, to the date of settlement, Dec. 8, 2008 (Period Three).

The contractual prohibition of the abatement of interest set forth in the “terms of sale” section of the advertisement of the foreclosure sale was presumptively binding on Zorzit and the Purchasers. Thomas, 183 Md.App. at 402, 405. The Purchasers had the initial burden of rebutting that presumption by showing that this case fell within one of the equitable circumstances delineated in Donald.

It was clear from the record that Period Two, the time period from the initial date set for final ratification of the foreclosure sale (Aug. 15, 2008) to the actual date of final ratification (Oct. 31, 2008), fits squarely within the third equitable circumstance delineated in Donald, because Period Two constituted a delay “caused by the conduct of other persons beyond the power of the purchaser to control or ameliorate.” Donald, 302 Md. at 477. Accordingly, the trial court properly exercised its discretion by abating the interest accrued during Period Two.

On the other hand, there was nothing in the record to indicate that Periods One and Three involved a delay in the foreclosure process, or that, if there was a delay, such delay “was caused by the conduct of other persons beyond the power of the purchaser to control or ameliorate.” See Donald, 302 Md. at 477.

Accordingly, the trial court abused its discretion by abating the interest accrued during Period One, from the date of the foreclosure sale (June 30, 2008) to the initial date set for final ratification (Aug. 15, 2008), and during Period Three, from the date of final ratification (Oct. 31, 2008) to the date of settlement (Dec. 8, 2008).

COMMENTARY: The Purchasers contended that the only thing the trial court have could done based upon the record before it was to abate all of the interest accrued against them. However, abating all of the accrued interest because of a failure to be provided with a computation of interest for a lesser time period had the effect of improperly placing the burden on Zorzit to show the amount of interest that should not be abated.

Furthermore, the trial court was able to compute the amount of the interest to be abated for the period of delay from Aug. 15, 2008 to Oct. 31, 2008. One of the exhibits admitted at the hearing on the motion to abate the interest was a copy of the advertisement for the foreclosure sale, which stated that the sale would take place on June 30, 2008, that a deposit of 10% of the purchase price was required, and that interest at the rate of 10% per annum was payable on the unpaid balance “from the date of sale to the date funds are received in the office of [Zorzit].”

Also admitted at the hearing was the settlement statement, dated Dec. 8, 2008, which showed the purchase price of $1.2 million and a deposit of $120,000, leaving an unpaid principal balance of $1,080,000. The record also contained all of the relevant dates that defined Periods One, Two, and Three.

Thus, the case was remanded to the circuit court for a determination of the appropriate amount of interest to be abated for the 77 days of delay between Aug. 15, 2008 and Oct. 31, 2008.

Real Property

Ejectment

BOTTOM LINE: Tenant had the absolute right to obtain relief from the default judgment of possession entered against it in an ejectment action without having to comply with or satisfy the requirements of Rule 2-535(b).

CASE: Priority Trust, LLC v. The Aliceanna Group, No. 1296, Sept. Term, 2009 (filed Feb. 2, 2011) (Judges WRIGHT, Graeff & Davis (retired, specially assigned)). RecordFax No. 11-0202-02, 11 pages.

FACTS: Priority Trust, LLC filed a complaint in the circuit court, seeking to eject The Aliceanna Group from a property in Baltimore. Priority Trust, the ground rent owner of the Property, alleged that Aliceanna, the leasehold owners, had not paid ground rent. Thus, Priority Trust sought recovery of the Property and damages in the amount of $5,000.

The circuit court entered a default judgment for possession of the Property against Aliceanna and Priority Trust filed a request for a writ of possession, which was subsequently issued.

Aliceanna filed a motion for relief from judgment of possession, pursuant to RP §8-402.2(c)(2). Priority Trust filed a response arguing that Rule 2-535 precluded the relief sought by Aliceanna The circuit court granted Aliceanna’s motion and denied Priority Trust’s motion for reconsideration.

The court ordered Aliceanna to pay Priority Trust the redemption amount of $1,972 within 30 days.

Priority Trust appealed to the Court of Special Appeals, which affirmed.

LAW: Under Rule 2-535, on motion of any party filed within 30 days after entry of judgment, “the court may exercise revisory power and control over the judgment and, if the action was tried before the court, may take any action that it could have taken under Rule 2-534.” On motion of any party filed at any time, “the court may exercise revisory power and control over the judgment in case of fraud, mistake, or irregularity.”

Citing Norris v. Campbell, 27 Md. 688 (1867), Redding v. Redding, 180 Md. 545 (1942) and Master v. Master, 223 Md. 618 (1960), Priority Trust averred that Rule 2-535(b) is the only method by which a court can exercise revisory power and control over a judgment.

The cases relied upon by Priority Trust are inapposite. In Norris, the Court of Appeals reviewed the lower court’s grant of injunction in favor of appellee debtors, which prevented appellant creditors from obtaining judgment against the former. Norris, 27 Md. at 691. Similarly, in Redding, the Court of Appeals reviewed the lower court’s grant of injunction in favor of appellee creditors, which prevented appellant debtors from obtaining judgment. Redding, 180 Md. at 547. Neither party in this case was seeking to enjoin the other from obtaining judgment.

Further, although the Redding Court recognized “[t]he right, in a proper case, to secure relief from an execution by an original bill in equity,” id. at 549, Priority Trust’s reliance on that statement was misplaced, as the Court never mandated that the right to secure relief could exclusively be exercised by way of an “original bill.”

In Master, the Court of Appeals stated that it was “proper” for appellee “to seek relief by an original bill to vacate an enrolled decree for fraud.” Master, 223 Md. at 623. However, the question here was not considered by the Court in Master.

Under appropriate circumstances, Rule 2-535 may be utilized to strike out a judgment in a ground rent ejectment action. It is not, however, the exclusive remedy and does not in any way prohibit or modify relief under RP §8-402.2(c)(2).

Under RP §8-402.2(c)(2)(ii), in a ground rent ejectment action, “the property is discharged from the lease and the rights of all persons claiming under the lease are foreclosed unless, within 6 calendar months after execution of the judgment for possession, the tenant or any other person claiming under the lease: (i) Pays the ground rent, arrears, and all costs awarded against that person; and (ii) Commences a proceeding to obtain relief from the judgment.”

RP §8-402.2(c)(2)(ii) uses the term “proceeding” and not “action.” “‘Proceeding’ means any part of an action.” Rule 1-202(u) (formerly Rule 1-202(t)). In turn, “‘[a]ction’ means collectively all the steps by which a party seeks to enforce any right in a court.” Rule 1-202(a).

Thus, by using the word “proceeding” as opposed to “action” in RP §8-402.2(c)(2)(ii), the legislature appears to have indicated a preference for filing the request for relief from judgment of possession in the underlying action as opposed to a separate action.

Thus, because the statute requires a tenant to “[c]ommence[ ] a proceeding,” or part of an action, in order to obtain relief from the judgment, Aliceanna acted properly when they filed their motion in the existing action.

This interpretation is in keeping with Rule 1-201(a), which provides that “rules shall be construed to secure simplicity in procedure, fairness in administration, and elimination of unjustifiable expense and delay.” If a tenant or any other person claiming under the lease was required to file a separate action in order to obtain relief under RP §8-402.2(c)(2), such a requirement would promote, instead of eliminate, unjustifiable expense and delay. It would also defeat any simplicity in procedure.

COMMENTARY: Having determined that the court could review Aliceanna’s motion under RP §8-402.2(c)(2), the question was whether Aliceanna satisfied the statute’s requirements. Priority Trust did not dispute that Aliceanna filed their motion for relief from judgment of possession within six months after execution of the judgment for possession, nor did it dispute that Aliceanna were within the class of persons entitled to request relief.

Therefore, after having commenced the proceeding, Aliceanna needed only “pay[ ] the ground rent, arrears, and all costs awarded,” in order to obtain relief from the judgment. Aliceanna were ordered, by the court, to pay Priority Trust the redemption amount of $1,972.00 within 30 days of July 14, 2009, thereby satisfying the statute’s requirements.

PRACTICE TIPS: Under Rule 4-217(i)(2), a court may strike out bail bond forfeiture “[i]f the defendant or surety can show reasonable grounds for the defendant’s failure to appear, notwithstanding Rule 2-535.”

Torts

Wrongful death

BOTTOM LINE: Trial court erred when it dismissed plaintiffs’ wrongful death claims without granting leave to amend their pleadings to name the decedent’s estranged son as a “use plaintiff” because the court failed to consider whether the son would be prejudiced by dismissal.

CASE: Muti v. University of Maryland Medical Systems Corporation, No. 1991, Sept. Term, 2009 (filed Feb. 4, 2011) (Judges Woodward, MATRICCIANI & Moylan (retired, specially assigned)). RecordFax No. 11-0204-01, 25 pages.

FACTS: In January 2005, Elliot Muti suffered an acute myocardial infarction. He was admitted to University Medical Systems Corporation (UMMS) for emergency coronary bypass surgery. Following the surgery and subsequent treatment by UMMS physicians, Muti’s condition worsened and he died on March 4, 2005, at the age of 65.

On Sept. 23, 2008, Giuseppina, Tom and David Muti filed a complaint in the circuit court for Baltimore City, naming UMMS as the sole defendant and claiming three counts of wrongful death and one count of medical negligence as a survival action.

On Aug. 31, 2009, UMMS moved to dismiss the claims for failure to join a necessary party and, in the alternative, for summary judgment on all counts.

The circuit court granted the motion to dismiss and subsequently issued orders that dismissed the Mutis’ wrongful death claims without leave to amend and granted summary judgment to UMMS on the remaining survival claim.

The Mutis appealed to the Court of Special Appeals, which reversed.

LAW: The CJP governs wrongful death claims and provides, in relevant part, that a wrongful death action “shall be for the benefit of the wife, husband, parent, and child of the deceased person…” §3-904(a). Pleadings in wrongful death claims fall under Maryland Rule 15-1001, which states, in relevant part, that if the wrongful act occurred in Maryland, “all persons who are or may be entitled by law to damages by reason of the wrongful death shall be named as plaintiffs whether or not they join in the action.” The Rule further states that “the words ‘to the use of’ shall precede the name of any person named as a plaintiff who does not join in the action.”

Here, there was no dispute that the Elliot Muti’s estranged son, Ricky Muti, was a person who “may be entitled by law to damages by reason of the wrongful death” under CJP §3-904.5 There was also no dispute that Ricky was not named as a plaintiff or “use plaintiff,” as required.

Rule 15-1001(b) does not, however, provide a specific remedy in such a case. Thus, in accordance with Rule 1-201, the trial court “may compel compliance with the rule or may determine the consequences of the noncompliance in light of the totality of the circumstances and the purpose of the rule.” See Jones v. Prince George’s County, 378 Md. 98, 117 (2003) (“standing to bring a wrongful death action is a procedural matter to be covered by rules and not an issue of substantive law”). As such, it was necessary to determine whether the trial court abused its discretion when it dismissed the Mutis’ claims with prejudice. See Gaetano v. Calvert County, 310 Md. 121, 126 (1987).

In Walker v. Essex, 318 Md. 516, 518 (1990), the decedent was survived by his two infant sons, each from a different mother. The mother of one son agreed to settle with the defendants’ insurer, who was unaware of the other son. Walker, 318 Md. at 518. The insurer contested the arrangement upon learning of the other son, but the trial court enforced the settlement agreement by entering a judgment against the defendants. Id. The Walker Court considered whether the settlement by one wrongful death beneficiary requires the consent of the other joined beneficiaries or the approval of the court, and began by briefly reviewing the history and intent of Maryland’s wrongful death statute. Id. As noted in Walker, the common law not only denied a tort recovery for injury once the tort victim had died it also refused to recognize any new and independent cause of action in the victim’s dependents or heirs for their own loss at his death. In response to this harsh rule, the English legislature created a cause of action for wrongful death by enacting the Fatal Accidents Act of 1846, also known as Lord Campbell’s Act. 9 & 10 Vict. c. 93. In 1852, Maryland adopted a statute strongly resembling Lord Campbell’s Act, 1852 Maryland Laws Chapter 299.

Currently, the relevant section of the wrongful death subtitle states that “Only one action under this subtitle lies in respect to the death of a person.” Cts. & Jud.Proc., §3-904(f). The purpose of the one-action rule is to protect a defendant from being vexed by several suits instituted by or on behalf of different equitable plaintiffs for the same injury, when all the parties could be joined in one proceeding. Walker, 318 Md. at 522-23. The Walker Court went on to explain that while the English statute vested the cause of action in the decedent’s estate, under Maryland law the suit is brought in the name of a person entitled to recover, to the “use of” any other interested parties. Id. at 523.

“When looking to the direction of §3-904(b), we are told that ‘only one action under this subtitle lies in respect to the death of a person.’ We are also instructed that, if a recovery or verdict is obtained in this one action, the amount recovered shall be “divided among the beneficiaries in shares directed by the verdict.” The statutory language does not allow a judgment for one of the beneficiaries to be made a matter of record, as by its very nature, other claims are forever foreclosed or barred. The trial judge in this case considered the claims of the beneficiaries to be severable. The statute does not. A judgment should not have been entered in the circuit court unless it included the interests of all of the known beneficiaries…The circuit court, accordingly, should have been concerned all minor beneficiaries shared in the judgment and the available proceeds … ” Id. at 523-24.

Although the facts of Walker concerned only a settlement, the case nevertheless indicated that the purpose of Rule 15-1001 is to minimize prejudice to the defendants and the absent plaintiffs. This proposition is further supported in Williams v. Work, 192 Md.App. 438, 455 (2010), which held that, “[a]lthough Rule 15-1001(b) does not require formal joinder, the failure to include a known statutory beneficiary as a plaintiff or a ‘use plaintiff’ in a wrongful death action and to settle without providing for that beneficiary can be analogized to the failure to join a necessary party in an action where joinder is required.”

In the present case, there was no dispute that Giuseppina, Tom and David Muti failed to comply with the requirements of Rule 15-1001. The Mutis argued that compliance was impossible because Ricky’s whereabouts were unknown, and they emphasized that Ricky may not even be alive; however, those proffers were irrelevant. In a situation such as this, where a party cannot be joined, Rule 15-1001 requires only that the real parties in interest name each use plaintiff and “mail a copy of the complaint by certified mail to any use plaintiff at the use plaintiff’s last known address.” There was nothing in the record to indicate that the Mutis could not have substantially complied with Rule 15-1001 by sending notice to his last known address and amending the pleadings to name him as a use plaintiff.

Given that the Mutis did not comply with Rule 15-1001, and because the court could not have rendered judgment without the use plaintiff, it could not be said that the court abused its discretion when it dismissed their claims. See, e.g., Williams, at 452. However, the question remained as to whether the trial court should have granted the Mutis leave to amend their pleadings.

It was determined that the trial court erred when it held that it would grant the motion to dismiss for “one reason,” namely that “the Court in applying the law is not to look to [see] whether or not this will make it difficult for one party or the other.” The clear import of Maryland’s rules of procedure and case law is to the effect that, before dismissing a complaint under the auspices of Rule 15-1001 for failure to name a use plaintiff, the court must consider whether doing so will prejudice that use plaintiff. Indeed, UMMS all but proved that point when it cited Rule 2-211(c) in its motion to dismiss to argue: “Plainly, Ricky Muti…is a necessary party…[whose] rights and interests arose out of his father’s death and are required to be adjudicated with all of the other Wrongful Death claims in this case.”

For these reasons, the court erred when it did not grant the Mutis leave to amend their pleadings to name Ricky Muti as a “use plaintiff” without first considering whether Ricky would be prejudiced thereby. Because the potential prejudice to Ricky was not considered, the record was insufficient to determine whether dismissal should ultimately have been granted.

Accordingly, the judgment of the circuit court granting UMMS’s motion to dismiss was vacated, and the wrongful death claims were remanded for further proceedings.

COMMENTARY: The Mutis also asserted that the trial court erred when it granted summary judgment in favor of UMMS.

Summary judgment is proper where the motion and response show that there is no genuine dispute as to any material fact and that the party in whose favor judgment is entered is entitled to judgment as a matter of law. Md. Rule 2-501(f).

The Mutis’ survival action claimed medical malpractice, whose “elements translate into a duty of care owed by the health care provider to the patient; a breach of the applicable standards of care; proximate causation of a medical injury; and damages.” State v. Copes, 175 Md.App. 351, 370 (2007). The Mutis provided two theories of breach and a theory of causation that unified them. First, they relied upon medical testimony to prove that UMMS’s staff breached standards of care when they intubated Elliot Muti, causing a tracheal tear and resultant medical complications. Second, the Mutis relied upon the testimony of a doctor to prove that UMMS’s critical care staff breached the standards of care when they failed to diagnose and treat a tracheal tear. UMMS asserted that, taken either separately or together, the opinions testified to by the Mutis’ experts were in irreconcilable conflict and were therefore insufficient to establish a coherent theory of liability.

It was found, however, that based upon the medical testimony, a jury could have found the requisite elements of causation and breach as matters of fact. Accordingly, the judgment of the circuit court granting UMMS’s motion for summary judgment was reversed.

Workers’ Compensation

Out-of-state coverage

BOTTOM LINE: An endorsement in a Delaware contractor’s workers’ compensation policy, which provided coverage for temporary operations outside of the named state of coverage under certain circumstances, provided coverage for the injuries sustained by a nonresident employee of the subcontractor while working in Maryland.

CASE: Zurich American Insurance Company v. Uninsured Employers’ Fund, No. 1509, Sept. Term, 2009 (filed Feb. 3, 2011) (Judges EYLER, J., Zarnoch & Sharer (retired, specially assigned)). Record Fax No. 11-0203-03, 19 pages.

FACTS: A & B Enterprises, Inc., a Delaware corporation, was in the business of constructing “farm buildings,” “food shelters,” and “post frame buildings.” A & B performed 90% of its work in Delaware and 10% of its work in Maryland.

A & B contracted with Richard Townsend, a resident of Salisbury, Maryland, to build a pole building on Townsend’s land. A & B then subcontracted the work to Wayne and Marie Travis, Delaware residents, doing business as WMT Contracting. WMT performed 95% of its work in Delaware, 3% of its work in Maryland, and 2% of its work in Virginia.

Dean Young, a Delaware resident, was employed by WMT. While working on the job site in Salisbury, Young fell and was injured. After the injury, Young continued to work for WMT at a job site in Delaware but, because of his injuries, was able to work only one day.

American Zurich Insurance Company had issued to A & B a “workers’ compensation and employers liability” policy (the Policy) which included a “residual market limited other states insurance endorsement” (the Endorsement).

Young filed a workers’ compensation claim against WMT in Delaware, with that state’s Industrial Accident Board (the Board), but did not collect benefits because WMT was uninsured

Young then filed a workers’ compensation claim against WMT in Maryland. The Uninsured Employers’ Fund (UEF) impleaded both A & B as statutory employer and Zurich.

The Maryland Workers’ Compensation Commission (the Commission) ruled that Young was employed by WMT; that WMT was uninsured; that A & B was the statutory employer of Young; that A & B was covered by the Policy; and that Young had sustained a compensable injury. With respect to coverage, the Commission found that A & B was covered by the Policy by virtue of the terms of the Endorsement.

Zurich filed a petition for judicial review in circuit court. Zurich and UEF each filed a motion for summary judgment. The circuit court granted UEF’s motion and denied Zurich’s motion. The Court of Special Appeals affirmed. Zurich filed a motion for reconsideration. The Court of Special Appeals granted the motion and withdrew its earlier opinion.

Albeit for a different reason than originally stated, the Court of Special Appeals again affirmed.

LAW: “Each employer shall secure compensation for covered employees of the employer” by maintaining insurance with the Injured Workers’ Insurance Fund, maintaining insurance with an authorized insurer, or by maintaining self-insurance. LE §9-402(a). The Commission must approve the form of a workers’ compensation insurance policy. LE §9-309(e) and IN §19-402.

To the extent pertinent, an award is payable by the UEF if an employer fails to secure payment of compensation in accordance with §9-402. See LE §9-1002.

The workers’ compensation act applies to employers with at least one covered employee. LE §9-201. An individual is presumed to be a covered employee while in the service of an employer under an express or implied contract of hire. LE §9-202. A “covered employee” is a person for whom an employer is required to provide workers’ compensation coverage. LE §9-101(f). An individual is a covered employee while working for the individual’s employer “in this State.” LE §9-203(a).

There are exceptions. “A casual employee is not a covered employee.” LE §9-205. In addition, “[a]n individual is not a covered employee while working in this State for an employer only intermittently or temporarily if: (i) the individual and employer make a contract of hire in another state; (ii) neither the individual nor the employer is a resident of this State; (iii) the employer has provided workers’ compensation insurance coverage under a workers’ compensation or similar law of another state to cover the individual while working in this State; (iv) the other state recognizes the extraterritorial provisions of this title; and (v) the other state similarly exempts covered employees and their employers from its law.” LE §9-203(b)(1).

In Maryland, a principal contractor which is not the direct employer of the worker is liable under the following circumstances and, when liable, is commonly referred to as a statutory employer. “A principal contractor is liable to pay a covered employee any compensation that the principal contractor would have been liable to pay had the covered employee been employed directly by the principal contractor if: (1) the principal contractor undertakes to perform any work that is part of the business, occupation, or trade of the principal contractor; (2) the principal contractor contracts with a subcontractor for the execution by or under the subcontractor of all or part of the work undertaken by the principal contractor; and (3) the covered employee is employed in the execution of that work.” LE §9-508(a).

A & B was a statutory employer and, thus, was liable for benefits. The question of insurance coverage turned on the language in the Endorsement.

In Maryland, “the interpretation of an insurance policy is guided by the same principles that apply to the construction of other contracts.” Philadelphia Indem. Ins. Co. v. Maryland Yacht Club, Inc., 129 Md.App. 455, 467 (1999).

The Endorsement provided: “A. 1. We will pay promptly when due the benefits required of you by the workers compensation law of any state not listed in Item 3.A of the Information Page if all of the following conditions are met: a. The employee claiming benefits was either hired under a contract of employment made in a state listed in Item 3.A of the Information Page or was, at the time of injury, principally employed in a state listed in Item 3.A of the Information Page; and b. The employee claiming benefits is not claiming benefits in a state where, at the time of injury, (i) you have other workers compensation insurance coverage, or (ii) you were, by virtue of the nature of your operations in that state, required by that state’s law to have obtained separate workers’ compensation insurance coverage, or (iii) you are an authorized self-insurer or participant in a self-insured group plan; and c. The duration of the work being performed by the employee claiming benefits in the state for which that employee is claiming benefits is temporary.”

Subsections a., b., and c. of the Endorsement are joined by “and,” and all have to be satisfied. The three sub-parts in b. are joined by “or,” and are disjunctive, but because the lead in phrase is in the negative (“We will pay when … the employee … is not claiming benefits in a state where”), satisfaction of any of the three sub-parts prevents coverage. Thus, subsection b. is satisfied if A & B had other coverage, was required, by virtue of its operations in Maryland, to have separate coverage, or was a self-insurer. Subsection c. is satisfied if the duration of the work being performed by Young was temporary.

Young was hired in Delaware, and thus, A. 1.a. was satisfied. Under subsection A. 1.b., A & B did not have other workers’ compensation insurance in Maryland and was not an authorized self-insurer in Maryland. Thus, the question was whether A & B was required to have “separate workers compensation insurance coverage” in Maryland.

With respect to a “casual” employee, “‘where the employment for one job cannot be characterized as permanent or periodically regular, but occurs by chance, or with the intention and understanding on the part of both employer and employee that it shall not be continuous, it is casual.’” Smigelski v. Potomac Ins. Co., 403 Md. 55, 62-63 (2008)(quoting Lupton v. McDonald, 241 Md. 446, 452 (1966)).

The Court continued: “Some of the factors we use to determine whether an employee is a casual employee are: the nature of the work, the duration of the employment, and the nature of the contract of employment. [T]he question ‘must be determined with principal reference to the scope and purpose of the hiring rather than with sole regard to the duration and regularity of the service.’“ Smigelski, 403 Md. at 63(quoting State Accident Fund v. Jacobs, 134 Md. 133, 135 (1919)).

The evidence was that Young was hired as a regular employee, with the intention by both employer and employee that he would continue employment for a regular and indefinite term. Thus, he was not a “casual” employee within the meaning of §9-205. Furthermore, Young was a “covered employee.”

A & B did not regularly do business in Maryland; Young was working in Maryland temporarily; coverage under the Endorsement satisfies Maryland law; and A & B was not required to have separate coverage in Maryland.

Thus, if an employee employed in the state of coverage, in this instance Delaware, is injured in another state which provides for benefits under its laws, in this instance Maryland, but the employer does not regularly do business in that state, and the employee is performing work in that state on a temporary basis, the Endorsement provides coverage.

Furthermore, the “duration of the work being performed by [Young was] temporary,” within the meaning of A.1.c.

In Granite State Ins. Co. v. Hernandez, 191 Md.App. 548, 567 (2010), the employee was employed in Maryland, worked on three projects in Maryland, and was injured in Maryland. The employer was insured in Virginia. The terms of the policy included an endorsement identical to the Endorsement here. Thus, the endorsement did not provide coverage because A. 1.a. was not satisfied (the employee was not hired in Virginia and was not principally employed in Virginia). In addition, there was not evidence that the employee’s “work in Maryland was temporary to otherwise regular work in Virginia.” Id. at 568.

Here, however, there was evidence that it was the intention of the parties to the employment agreement that Young generally work in Delaware. The parties expected that Young would be in Maryland only a few days.

Young was hired in Delaware within the meaning of A. 1.a. Maryland did not require “separate workers compensation insurance coverage” within the meaning of A. 1.b. of the Endorsement. Young’s work in Maryland was temporary within the meaning of A.1.c.

Consequently, the Endorsement provided coverage for Young’s injuries.

COMMENTARY: Other related statutes and regulations included COMAR 14.09.06, which requires an insurer issuing policies in Maryland to maintain an office in Maryland. Furthermore, the Commission must approve the form of a workers’ compensation insurance policy. LE §9-309(e) and IN §19-402. A tax is assessed against each insurer pursuant to LE §9-316(c).

PRACTICE TIPS: If an employer fails to secure insurance coverage pursuant to LE §9-402, the employer must pay premiums to become insured with the Injured Workers’ Insurance Fund, LE §9-407, which insures employers against liability under Title 9 of the Labor and Employment Article.