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Opinions – Maryland Court of Appeals: 5/16/11

Constitutional Law

Right to counsel

BOTTOM LINE: Criminal defendant was entitled to a new trial because the trial court violated his right to counsel of choice by disqualifying one of his attorneys from the defense team.

CASE: State v. Goldsberry, No. 141, Sept. Term, 2008 (filed April 26, 2011) (Judges Bell, Harrell, Battaglia, Greene, Adkins & BARBERA) (Judge Murphy dissenting). RecordFax No. 11-0426-21, 56 pages.

FACTS: James Goldsberry and his co-defendant, James Myers were tried jointly on charges arising from the homicide of Vincent Chamberlain. Goldsberry hired attorneys Andrew Jezic, Joseph McKenzie, and John Giannetti, each of a different law firm, to represent him at trial.

Before trial, Myers filed a motion to sever from Goldsberry. At a hearing Myers’ counsel, Janet Hart, informed the court that attorney McKenzie had spoken previously to Myers regarding the facts of the case. Ms. Hart was not certain of the exact date on which the conversation took place, the purpose of the conversation, whether McKenzie by that time had entered his appearance on behalf of Goldsberry, and whether Myers was represented by counsel at the time. Hart nevertheless alleged that the conversation between her client and McKenzie posed possible violations of Maryland Rules of Professional Conduct 1.18 and 4.2.

After hearing from both parties on the issue, the trial court found as a fact that the conversation between Myers and McKenzie took place before Myers was indicted. The court denied the motion for severance and, instead, imposed restrictions on McKenzie’s involvement in the trial. After Jezic objected, the court modified its ruling, explaining that McKenzie could remain at the trial table, but was not to reveal to Jezic anything related to his conversation with Myers.

At that point, the State brought to the trial court’s attention a second potential conflict, one that involved McKenzie and Tawanna Davis, who was scheduled to testify as a State’s witness. Ms. Davis, according to the State, had testified before the grand jury that she was “coached” by Goldsberry and McKenzie. Based on this conflict, the trial court then ruled that McKenzie was disqualified entirely from the defense.

At the close of all the evidence, the court gave instructions concerning felony murder, including an instruction on first degree felony murder and second degree felony murder.

The jury convicted Goldsberry of second-degree felony murder and related charges. The Court of Special Appeals affirmed in part, finding that there was no Sixth Amendment violation, and reversed in part on the ground that the trial court erred in instructing the jury on second degree felony murder and, presumably, sending that charge to the jury.

The Court of Appeals affirmed in part, reversed in part and remanded for a new trial.

LAW: The Sixth Amendment provides that, “[i]n all criminal prosecutions, the accused shall enjoy the right … to have the Assistance of Counsel for his defence.” The right to counsel includes the right of a defendant, who does not require court-appointed counsel, to select the counsel of his or her choosing. Wheat v. United States, 486 U.S. 153 (1988). The right to counsel of choice, however, is qualified.

In Wheat, Wheat and numerous co-defendants had been charged with participating in a drug distribution conspiracy. Two of those co-defendants were represented by attorney Eugene Iredale. Wheat, evidently impressed by the results Iredale obtained with his co-defendants, contacted Iredale to request his representation. The district court denied Wheat’s request for substitution of Iredale as his counsel on the ground that the joint representation would pose an irreconcilable and unwaivable conflict. Wheat was convicted of conspiracy to distribute marijuana and related offenses.

The Supreme Court affirmed, stating that the right to choose one’s counsel may be circumscribed by a trial court when necessary to uphold “the ethical standards of the profession” and to ensure that “legal proceedings appear fair to all who observe them.” Id. at 160. In other words, the right to choice of counsel is not absolute: one may not select an unbarred advocate or an attorney about whom a “court justifiably finds an actual [or a serious potential for a] conflict of interest[.]” Id. at 162.

It is in the latter context that the “likelihood and dimensions of nascent conflicts of interest are notoriously hard to predict,” requiring the trial court to act without the benefit of a fully developed record produced at trial. Id. at 162. For this reason, the trial court is afforded “substantial latitude in refusing waivers of conflicts of interests.” Id. at 163. The Court determined that the proper balance is struck when “the district court [ ] recognize[s] a presumption in favor of [the defendant’s] counsel of choice,” which “may be overcome not only by a demonstration of actual conflict but by a showing of a serious potential for conflict.” Id. at 164.

In People v. Ortega, 808 N.E.2d 496 (Ill.2004), the Supreme Court of Illinois suggested a framework based on Wheat: The trial court must first determine whether there is “actual or serious potential for conflict.” Id. at 502. If the court finds a conflict, it must then determine whether the presumption favoring one’s counsel of choice is overcome by the interests of fairness and maintenance of ethical standards implicated by the conflict. Id. (citing Wheat, 486 U.S. at 160).

In conducting this balancing test, the court may consider the following factors relevant to the conflict: the likelihood that defense counsel will have divided loyalties; the State’s right to a fair trial; the appearance of impropriety should the jury learn of the conflict; and the likelihood that defense counsel’s continued representation will provide grounds for overturning the conviction. Id. See also State v. Peeler, 828 A.2d 1216, 1225 (Conn.2003).

Based on the approach to this issue taken by the Illinois and Connecticut courts, before a trial court is permitted to disqualify a criminal defendant’s privately obtained counsel, the court must conduct a hearing on the matter, “scrutinize closely the basis for the claim,” Peeler, 828 A.2d at 1225, and make evidence-based findings to determine, based on factors such as those outlined in Ortega, whether there is “actual or serious potential for conflict” that overcomes the presumption the defendant has to his or her counsel of choice. The record must reflect that the trial court contemplated relevant factors in conducting the test that balances the right to one’s counsel of choice against the necessity to uphold “the ethical standards of the profession” that ensure that “legal proceedings appear fair to all who observe them.” See Wheat, 486 U.S. at 160.

Here, the trial court, prompted by representations made first by attorneys Hart, Myers, and Jezic, and then by the State, determined sua sponte to deny Goldsberry’s choice of counsel. Contrary to the “serious,” if not near-certain, potential for conflict posed by Iredale’s representation in Wheat, the record here of a potential conflict posed by McKenzie’s continued representation of Goldsberry was “sketchy” at best.

McKenzie’s conversation with Myers “could have” violated Rule 1.18. At the hearing on Myers’s motion to have his trial severed from Goldsberry’s, the trial court was presented with imprecise assertions from Myers’s counsel about McKenzie’s conversation with Myers. There were no facts indicating that, at the time of the conversation, Myers was represented by counsel.

Moreover, the only information before the trial court concerning the content of the conversation came from McKenzie’s representation to the court that Myers related to him only the “facts” of the case, and made “no admissions.” The trial court did not ask of McKenzie his intentions in meeting with Myers. Nor did the trial court request from Myers’s counsel a proffer concerning the nature of the conversation.

Likewise, though Rule 4.2, which prohibits a lawyer from communicating with a person whom the lawyer “knows is represented in the matter by another attorney,” was not specifically mentioned by the trial court in its decision to disqualify McKenzie, the court explicitly rejected the possibility of the rule’s violation when it found that McKenzie “did not know” whether Myers was represented by counsel.

Furthermore, the trial court, relying solely on the State’s representation that the potential State witness, Ms. Tawanna Davis, had testified before the grand jury to being “coached” by McKenzie, inferred that McKenzie could be called by the State as a witness. Based on the record before the trial court, it could not be concluded that there was a showing of “serious potential” that McKenzie would be called as a witness.

At a minimum, the court, prior to disqualifying McKenzie, should have conducted an in camera hearing to determine the likelihood that the State would be calling Ms. Davis as a witness; and, in that event, whether she would in fact testify to having been “coached” by McKenzie and, if so, what she meant by the term “coach.”

Therefore, the court’s failure to develop a factual record that supported its decision to disallow McKenzie as one of Goldsberry’s defense attorneys denied Goldsberry his Sixth Amendment right to counsel of his choice. That constitutional violation entitled Goldsberry to a new trial.

COMMENTARY: The State contended that the Court of Special Appeals erred in holding that Goldsberry was convicted of a “non-existent” crime, i.e., second-degree felony murder based on the crime attempted robbery with a dangerous weapon (attempted armed robbery).

The purpose of Maryland’s statutory scheme, which divides murder into degrees, is to differentiate severity of punishment. Fisher v. State, 367 Md. 218, 250 (2001). A person commits felony murder when the person’s “conduct [brings] about an unintended death in the commission or attempted commission of a felony.”

When the facts make out only a charge of first degree felony murder, a trial court errs in instructing the jury on the crime of second degree felony murder. A trial court further errs, as the court did here, by sending the jury to its deliberations with a verdict sheet that presents the jury with the option of finding the defendant guilty of second degree murder.

However, the trial court’s errors in the present case, and the jury’s verdict flowing from them, did not lead ineluctably to the conclusion that Goldsberry cannot be re-tried on a charge of felony murder.

The General Assembly’s enactment of Chapter 138, §3 of the Act of 1809, Weighorst v. State, 7 Md. 442, 451 (1855), and as recently as in Roary v. State, 385 Md. 217 (2005), did not abrogate the common law crime of felony murder. Rather the Act divided the single, common law offense into two degrees of culpability, for penalty purposes only, dependent solely on the severity of the underlying felony. See also Jackson v. State, 286 Md. 430, 436 (1979); Abbott v. State, 188 Md. 310, 312 (1947).

Thus, notwithstanding the errors the trial court committed in its instructions, the jury’s finding that Goldsberry was guilty of felony murder should stand. The verdict unequivocally reflected the jury’s finding that Chamberlain was killed during Goldsberry’s commission of an attempted armed robbery. Those facts make out the crime of felony murder.

The only windfall to which Goldsberry was entitled was that, at re-trial, should the jury once again find him guilty of felony murder, the court is bound to impose a sentence no greater than 30 years’ imprisonment, the statutory maximum sentence for second-degree felony murder.

DISSENT: According to the dissent, Goldsberry’s Sixth Amendment right was not violated because the trial court was well within its bounds to restrict Goldsberry’s qualified right to counsel of choice. Consequently, the dissent also disagreed with the conclusion that the Court did not need to address the issue of whether the circuit court’s “modified unanimity instruction” was coercive.

PRACTICE TIPS: Where defense counsel himself brings to the trial court’s attention counsel’s own potential or actual conflict of interest, which, in that attorney’s view, prevents the attorney from adequately representing his or her client, “judges should normally accept at face value a lawyer’s assertion that a conflict of interest exists.” Lettley v. State, 358 Md. 26 (2000).

Contract Law

Governmental immunity

BOTTOM LINE: Because the legislative waiver of sovereign immunity was applicable to the defendant county and SG §12–203 provides a funding mechanism for judgments rendered against it following a waiver of sovereign immunity, the county was subject to suit on a written contract.

CASE: Beka Industries, Inc. v. Worcester County Board of Education, No. 47, Sept. Term, 2010 (filed April 26, 2011) (Judges Bell, Harrell, Battaglia, GREENE, Murphy, Adkins & Barbera). RecordFax No. 11-0426-24, 49 pages.

FACTS: In 2004, the Board of Education of Worcester County executed a written contract with BEKA Industries, Inc. to perform construction work on a new elementary school. The “lump sum bid” proposed for the work by BEKA and accepted by the Board was $1,856,000. Subsequent to execution of the contract, the parties agreed to three approved change orders, totaling $105,913, which increased the total contract price to $1,961,913.

BEKA’s work on the contract was completed by May 2006. During that time, there were numerous disputes regarding BEKA’s responsibilities under the original contract as well as the monetary consequences of modifications made by the Board. To date, the Board paid BEKA a total of $1,421,852.

BEKA filed a complaint in the circuit court, seeking damages in the amount of $1,157,053, as well as pre-judgment interest, post-judgment interest, costs and attorney’s fees. The County Board generally denied liability, raising 12 affirmative defenses in its first answer; a recoupment claim for “credits, backcharges, and/or setoffs” in the amount of $531,979 in its amended answer and counter–complaint; combining the recoupment claim and the 12 affirmative defenses in its second amended answer; and adding four more defenses to its third, and final, amended answer. The Board conceded at trial that it owed at least $361,991 on the balance of the original contract.

The trial judge struck the Board’s counter–complaint and amended answer and later the Board’s second and third amended answers.

Following a trial, the circuit court entered a judgment in favor of BEKA for $1.1 million, excluding prejudgment interest and not awarding attorney’s fees or post-judgment interest. The Court of Special Appeals reversed the judgment of the trial court and remanded the case to the circuit court for purposes of a new trial. BEKA petitioned for certiorari and the Board filed a conditional cross-petition, both of which were granted.

The Court of Appeals affirmed in part, reversed in part and remanded to the circuit court for a new trial.

LAW: The Maryland State Board of Education (MSBE) establishes standards and planning guidance for construction projects and the State Superintendent must approve of all plans for new construction and the remodeling of school buildings exceeding $350,000. ED §§2–205(l), 2–303(f). Annually, the MSBE must submit a public school budget to the Governor including appropriations for the Department itself and for aid to “counties … for the construction of school buildings.” ED §2–205(j). County boards of education may undertake the construction of public school buildings as long as the plans conform to the “bylaws, rules and regulations of the State Board” and to the regulations of the Board of Public Works related to alternative financing, when applicable. See ED §§4–115(b), 4–126.

Here, the Board contended that the doctrine of sovereign immunity barred this suit. The doctrine of sovereign immunity “prohibits suits against the State or its entities absent its consent.” Magnetti v. University of Md., 402 Md. 548, 557 (2007).

In order to determine if the doctrine of sovereign immunity applied to the Board, the question was: “(1) whether the entity asserting immunity qualifies for the protection; and if so, (2) whether the legislature has waived immunity either directly or by necessary implication, in a manner that would render the defense of immunity unavailable.” Magnetti, 402 Md. at 557 (quoting ARA Health v. Dept. of Public Safety, 344 Md. 85, 92 (1996).

A legislative waiver of sovereign immunity is ineffective unless “there are funds available for the satisfaction of the judgment or the agency has been given the power ‘for the raising of funds necessary to satisfy recovery against it.” Stern v. Board of Regents, 380 Md. 691, 701 (2004).

Under SG §12–201(a), “the State, its officers, and its units may not raise the defense of sovereign immunity in a contract action based on a written contract that an official or employee executed for the State or 1 of its units while the official or employee was acting within the scope of the authority of the official or employee.”

Because the Board is a State agency, a “unit” of the State in the parlance of the statute, the waiver of sovereign liability in contract actions set forth in SG §12–201 was expressly applicable. Moreover, since the contract between the Board and BEKA “was [(1)] reduced to writing; and (2) the State employee or official [the County Superintendent on behalf of the Board] acted within the scope of his, her, [or its] authority in executing the contract,” the contract was duly executed and falls within the waiver of sovereign immunity provided by SG §12–201(a). See ARA Health, 344 Md. at 92.

The Board contended that the legislative waiver of sovereign immunity contained in SG §12–201 did not apply because a county board of education is neither a State “unit,” nor a local government entity, drawing on the distinction made in Chesapeake Charter v. Board of Ed., 358 Md. 129, 135–36 (2000).

The Court of Appeals held in Chesapeake Charter that a county school board is not a “unit” within the meaning of the General Procurement Law, and accordingly, that the Maryland State Board of Contract Appeals had no jurisdiction over disputes arising from procurement decisions made by those boards. Chesapeake Charter, 358 Md. at 145–46. Thus, the fine distinction drawn in Chesapeake Charter for the purposes of determining whether a school bus contract (a local, operational expense) was governed by the State’s General Procurement Law, does not proscribe the application of SG §12–201(a)’s waiver of sovereign immunity to the Board in the present contract action.

Because SG §12–201(a) waives the Board’s sovereign immunity in an action based on a written contract for public school construction, the question was whether the General Assembly intended for a judgment awarded thereunder to be satisfied by funding requested by the Governor as part of a “budget bill” pursuant to SG §12–203.

SG §12–203 requires that “adequate” funds to satisfy a final judgment “rendered against the State or any of its officers or units” be made available through a “budget bill” after all appellate issues have been resolved.

According to the plain language of the statute, and its surrounding provisions relating to governmental immunity in contract suits, there is no indication that §12–203 differentiates between those judgments that the State must pay and those it must not as long as the legislative waiver of sovereign immunity enshrined in SG §12–201(a) is applicable to the dispute. See e.g., Coastal Holding & Leas. v. Maryland Environmental, 420 F.Supp.2d 441, 444–46 (2006).

The amount of money that the Governor would be required to include in the budget bill “to satisfy a final judgment” is a factual inquiry and must be determined at trial by reference to the contract provisions and an accounting of payments and reimbursements between the parties.

SG §12–203 has been found to be an explicit funding mechanism for judgments based upon written contracts against the State, its officers, or units. See Stern, 380 Md. at 715. Therefore, §12–203 applied to the instant case because it was already determined that SG §12–201(a) waives the Board’s governmental immunity and the language of SG §12–203 requires that all judgments rendered against the State, its officers or units, upon breach of a written contract shall be requested by the Governor as part of a budget bill. Furthermore, the application of SG §12–203 to written contract disputes between a State entity and a private party is consistent with the purpose of providing a waiver to immunity in contract actions involving written agreements. See Magnetti, 402 Md. at 560.

Finally, CJ §5–518, which limits the liability of a self-insured board of education to $100,000, does not apply to contract claims.

Accordingly, the Board was subject to suit on the underlying contract action brought against it by BEKA.

COMMENTARY: At trial, the Board sought to reduce the amount of money damages awarded to BEKA by asserting its entitlement to “credits, backcharges, and/or set-offs” totaling $531,079 arising from proposed change orders.

The Board’s claim was a “recoupment” claim because it sought to adjust the amount awarded to BEKA in light of its own losses arising out of the same transaction from which BEKA sought a legal remedy. See The Impervious Products Co. v. Gray, 127 Md. 64, 68 (1915).

The trial judge granted BEKA’s motion in limine to bar any evidence of recoupment as an affirmative answer. The Court of Special Appeals held that the trial judge abused his discretion when he granted BEKA’s motion in limine.

BEKA’s motion in limine was based entirely on allegations that the County Board failed to produce information substantiating its recoupment claim and that it was severely prejudiced by this withholding.

There was scant commentary from the trial judge regarding his deliberation on BEKA’s motion in limine, except to indicate his belief that he had already ruled on the substantive issue of presentation of the recoupment claim by striking the counter–complaint and amended answer. The particular phrasing of the ruling, barring evidence of recoupment as “an affirmative answer,” indicated that the trial judge may have been persuaded by BEKA’s argument that it was prejudiced by failing to appreciate that information provided on “backcharges, credits and/or set-offs” at the beginning of litigation would be used as an “affirmative answer” or “affirmative defense.”

Notwithstanding the alleged prejudice, there was no legal reasoning stated on the record supporting the trial judge’s grant of this motion. The trial judge should have engaged in some factual and legal analysis regarding treatment of the recoupment claim pursuant to, or outside, of the contract. Because the Board was precluded from presenting evidence on its recoupment claim, the case was remanded to the circuit court for a new trial.

PRACTICE TIPS: There has never been a common law right to governmental immunity for contract claims against local governments, see Housing Authority v. Bennett, 359 Md. 356 (2000), and, by statute, a county governed by county commissioners, a chartered county, or code county expressly may not raise the defense of sovereign immunity for actions based upon written contracts. See Article 25, §1A, Article 25A, §1A, and Article 25B, §13A.

Contract Law

Non-solicitation clause

BOTTOM LINE: A former employee was entitled to recover attorney’s fees pursuant to a fee-shifting provision in the employment contract which stated that a prevailing party was entitled to recover attorneys’ fees incurred in defending against a claim arising from the contract.

CASE: Weichert Co. of Maryland, Inc. v. Faust, No. 43, Sept. Term, 2010 (filed April 27, 2011) (Judges Bell, Harrell, Battaglia, GREENE, Murphy, Adkins & Barbera). RecordFax No. 11-0427-22, 42 pages.

FACTS: Dorothy Faust was Vice President and Manager of a real estate sales office owned by Weichert Co. of Maryland, Inc., from May 1994 until February 2003. Faust and Weichert executed a contract which detailed Faust’s duties as manager, as well as the obligations of the parties following the conclusion of her employment. The agreement included a non-solicitation clause, which provided that during the period of one year from the date of termination, Faust could not, directly or indirectly, in any capacity, solicit for employment with any other company, any persons receiving compensation of any type from Weichert. Under the terms of the contract, if Weichert brought a claim under the non-solicitation clause and did not succeed on that claim, Faust would be entitled to recover attorney’s fees incurred in defending against the claim.

Two weeks after Faust ended her employment with Weichert, she joined another real estate company, Long & Foster Real Estate, Inc. On May 20, 2005, Weichert filed a complaint against Faust and Long & Foster in circuit court, claiming that Faust had breached the duty of loyalty owed to Weichert and that Faust had breached the non-solicitation clause included in her contract with Weichert. Specifically, Weichert alleged that Faust recruited Weichert’s sales agents and employees to work for Long & Foster.

The jury found that Faust had breached her duty of loyalty to Weichert, and awarded damages to Weichert in the amount of $250,000. The jury found that Faust had not breached the non-solicitation clause. After the trial, both parties filed petitions for costs and attorney’s fees. Faust was awarded attorney’s fees by the circuit court, and the Court of Special Appeals affirmed.

Weichert appealed to the Court of Appeals, which affirmed.

LAW: The first issue addressed was whether Faust’s breach of the duty of loyalty resulted in a forfeiture of her rights under the contract. The duty of loyalty is an implied duty, read into every employment contract, and requires that an employee act solely for the benefit of his employer in all matters within the scope of employment, avoiding all conflicts between his duty to the employer and his own self-interest. Maryland Metals, Inc. v. Metzner, et al., 282 Md. 31, 38 (1978). While the duty of loyalty requires that the employee refrain from actively and directly competing with his employer, some latitude is given to the employee in making arrangements for future employment. Maryland Metals, 282 Md. at 38–41. The determination of whether an employee has breached his or her inherent duty of loyalty is based on a thorough examination of the facts and circumstances. Maryland Metals, 282 Md. at 41.

However, an employee’s breach of duty does not automatically result in extinguishing the obligations of the employer. Regal Savings Bank v. Sachs, 352 Md. 356 (1999). The principal issue in determining whether the employee’s breach of contract justified his employer’s actions is the materiality of any misconduct. Id. at 363. Accordingly, not every breach of a duty by an employee extinguishes the employer’s contractual obligations. Id.

Faust argued that her breach of the duty of loyalty did not result in the forfeiture of her rights under her contract with Weichert. The non-solicitation provision in the parties’ contract presented rights and obligations separate from the remainder of the contract, and thus a breach of the inherent duty of loyalty did not necessarily affect those separate rights. Given that the duty of loyalty was never determined to be material, Weichert was not excused from performance. The non-solicitation provision presented divisible rights and obligations from the remainder of the contract, and thus a breach of the inherent duty of loyalty did not affect those rights. As such, Faust’s breach of the duty of loyalty did not result in a forfeiture of her rights under the fee-shifting provision of the non-solicitation clause.

Accordingly, the judgment of the Court of Special Appeals was affirmed.

COMMENTARY: The Court of Appeals also considered the issue of whether Faust could enforce the terms of the non-solicitation provision, despite a jury finding that she breached the duty of loyalty. Pursuant to the fee-shifting provision, the parties agreed that if either party brought an action “to enforce its rights hereunder” and judgment was entered in that party’s favor, the prevailing party would be entitled to reimbursement for attorney’s fees that party incurred. If the fee-shifting provision was deemed to pertain to the entire contract, then Faust would not be entitled to attorney’s fees because Weichert prevailed on its claim of breach of the duty of loyalty. If, on the other hand, the fee-shifting provision pertained only to the non-solicitation clause, then Faust would be entitled to attorney’s fees because Weichert did not prevail on its claim of solicitation.

The parties’ contract set forth the non-solicitation clause and, in 8 separate clauses, established the parties’ rights and obligations under the non-solicitation clause, as well as the mechanism for enforcement of the non-solicitation obligation. In various subsections of one paragraph, the agreement made clear that only disputes concerning a non-solicitation clause were enforceable by any legal means, and that involvement by a court of competent jurisdiction was contemplated in enforcement of the non-solicitation clause; no other section of the agreement referred to attorneys’ fees. It therefore followed that the particular non-solicitation clause subsection at issue related exclusively to the non-solicitation clause and entitled the prevailing party to attorney’s fees only in a suit based on the non-solicitation clause. Thus, the structure of the contract indicated that the word “hereunder” referred only to the provisions of the non-solicitation clause.

Applying this framework to the case at hand, Faust “prevailed” under the non-solicitation clause in that the jury found that she did not solicit any employees from Weichert to join Long & Foster. Therefore, under the fee-shifting provision, Weichert was required to reimburse Faust for attorneys’ fees incurred.

PRACTICE TIPS: Maryland generally adheres to the “American rule,” which holds that in which each party is responsible for its own legal fees, regardless of which party prevails in the case. Fee-shifting is an exception to the American rule, whereby a court orders payment of the prevailing party’s attorneys’ fees by the losing side. Fee-shifting may be accomplished by an express agreement or by statute.


Real property covenants

BOTTOM LINE: A declaration of rights in a three-parcel tract of land could be modified by the written agreement of less than all three owners, as long as the modification did not prejudice the interests of the third, non-consenting party.

CASE: 600 North Frederick Road, LLC v. Burlington Coat Factory of Maryland, LLC, No. 181, Sept. Term, 2010 (filed April 22, 2011) (Judges Bell, HARRELL, Battaglia, Greene, Murphy, Adkins & Barbera). RecordFax No. 11-0422-23, 41 pages.

FACTS: 600 North Frederick Road, LLC, owned a tract of land in Gaithersburg. Sometime before 1976, the tract was subdivided into Parcels One, Two and Three. The parcels were owned by Danac Real Estate Investment Corporation, which, on April 22, 1976, entered into a 30-year lease with Montgomery Ward & Co, Inc., involving Parcels One and Two. Pursuant to the lease, Montgomery constructed a retail store on Parcel One, and its parking on Parcel Two.

Montgomery’s use of Parcel Two for parking was subject expressly to Danac’s right to develop Parcel Two, but Montgomery’s need for parking on Parcel Two was to be accommodated in any development proposal by Danac, presumably by parking structures. The lease provided further that Danac was required to obtain Montgomery’s consent before commencing development on Parcels Two or Three, which consent was not to be withheld unreasonably. At the end of the original 30-year lease term, Montgomery had the option to extend the lease for ten years.

In 1980, Danac entered into a contract with Realty Dealership Corporation (RDC), by which RDC was to acquire fee-simple title to Parcels One and Two, in the name of a wholly-owned subsidiary, Eretz Land Corporation. Prior to closing the sale, Danac executed and recorded covenants reserving to itself development rights to Parcel Two. On Jan. 30, 1981, Danac executed a Declaration of Easement and Covenant. The 1981 declaration provided that, should Danac cease to be the fee simple owner of Parcel Two, Danac reserved the right, until Jan. 1, 2001, to enter into a 50-year ground lease with the owner, for an annual rent of $1,000. The proposed ground lease would grant Danac certain development rights on Parcel Two. Of particular importance to the present case, the 1981 declaration provided that the declaration could be modified or canceled only by written instrument signed by the owners of all of the parcels.

On Jan. 20, 1981, Danac conveyed Parcels One and Two to Eretz. The 1981 Declaration and the deed were recorded on Feb. 13, 1981. In October 1983, Danac sought Montgomery’s consent to develop Parcel Two with an office complex. Montgomery objected to Danac’s plan, asserting that proposed buildings would destroy the line of sight of occupants of vehicles on Route 355 to its store entrance, as well as most parking in front of the store. In October 1984, Montgomery filed a complaint in circuit court seeking a declaratory judgment that Danac had no rights arising under the 1981 declaration, or alternatively, declaring exactly what rights Danac had under the declaration.

Danac filed an answer and asserted various counterclaims. During that litigation, throughout 1987 and 1988, most of Parcel Three was conveyed to the State Highway Administration, Corner Limited Partnership, and Point Limited Partnership. Further, while the litigation was ongoing, Danac and Montgomery continued negotiations regarding the scope of Danac’s proposed development of Parcel Two. These negotiations culminated in 1992 in the execution of an Amended and Restated Declaration of Easements and Covenants. The 1992 declaration reiterated that it was intended to supersede and replace in its entirety the 1981 declaration and any other documents granting development rights to Declarant in Parcel Two. The 1992 declaration restated Purcell/Danac’s option, exercisable until Jan. 1, 2001, to enter into a ground lease with the owner of Parcel Two, at $1,000 per month. Importantly, the 1992 declaration delineated (with somewhat greater specificity than the 1981 declaration) restrictions on any future development on Parcel Two and emphasizing that the 1992 Declaration’s provisions would govern the construction of any Future Improvements on Parcel Two.

In 1994, after the 1992 Declaration was executed, the 1984 litigation was dismissed with prejudice. At some point prior to 1998, Burlington Coat Factory (BCF) began investigating whether the largely vacant Montgomery store on Parcel One would be a suitable site for one of its retail clothing stores. In October 1998, Montgomery assigned to BCF its interest as tenant under the 1976 Lease and, thereafter, BCF began operating a retail store in the building on Parcel One, while continuing the subleases of parts of the building to other businesses. The BCF operation on Parcel One became one of its best stores in Maryland.

In the fall of 2003, 600 North Frederick, became interested in acquiring Parcels One and Two. After conducting a due diligence review, the company’s outside counsel determined that the 1992 declaration was not binding on the owner of Parcel Two and that the covenants applied only to third-party developers of Parcel Two. As a result, 600 North Frederick, in December 2003, purchased Parcels One and Two, and eventually entered into an agreement with a developer, JPI Enterprises, Inc., for the development of Parcel Two. Under the development agreement, JPI was to purchase and develop Parcel Two, and 600 North Frederick, would remain the owner of Parcel One. When the LLC’s counsel contacted BCF regarding JPI’s proposed development of Parcel Two, BCF’s counsel advised 600 North Frederick Road, LLC, of its refusal to consent to the JPI project, explaining that the construction would be in violation of numerous provisions of the 1992 covenants and would substantially interfere with BCF’s operations at the site.

On June 7, 2007, 600 North Frederick filed a seven-count Complaint for Declaratory Relief against BCF in circuit court for Montgomery County. Among other things, 600 North Frederick asked that the court declare that: 1) the 1992 document was unenforceable; 2) the 1992 document failed to create an easement or covenant regarding Parcel Two; 3) BCF unreasonably withheld its consent and the 1976 lease permitted construction of the JPI Development; and 4) BCF waived its right to approve or disapprove the JPI Development. At trial, 600 North Frederick injected the additional issue of whether the 1992 declaration was invalid because it was not signed by the owners of Parcels One, Two and Three as required by the 1981 declaration.

On May 27, 2009, the circuit court rejected the LLC’s claim that the 1992 declaration’s restrictions on “Developer” were not applicable to the Owner of Parcel Two. Regarding the missing-signatories argument, the circuit court held that the 1992 declaration was valid and enforceable notwithstanding the fact that the owners of Parcel Three were not signatories to it. The LLC appealed to the Court of Special Appeals, which affirmed the circuit court judgment. Regarding the issue of whether BCF’s withholding of consent to development of Parcel Two was unreasonable, the Court of Special Appeals opined that there was substantial evidence in the record supporting the circuit court’s conclusion that BCF acted reasonably and in good faith.

The LLC appealed to the Court of Appeals, which vacated the judgment of the Court of Special Appeals and remanded the case to the circuit court.

LAW: In its first challenge to the validity of the 1992 declaration, 600 North Frederick Road contended that the 1992 declaration was invalid because it was not signed by all of the parcel owners. More specifically, the company argued that because the 1981 Declaration expressly provided that it could be modified or cancelled only by written instrument signed by the owners of the Parcels, the 1992 declaration, which was “intended to supersede and replace in its entirety” the 1981 declaration and any other documents granting development rights in Parcel Two, could not modify or replace the 1981 declaration without the signatures of the Parcel Three owners.

Generally, where the language of a contract is unambiguous, its plain meaning will be given effect. Aetna Cas. & Surety Co. v. Ins. Comm’r, State of Md., 293 Md. 409, 420 (1982). However, this rule is not without exceptions. For instance, the common-law rule is that even where the contract specifically states that no non-written modification will be recognized, the parties may yet alter their agreement by parole negotiation; thus, in some instances, the law may operate to allow supplementation or even modification of the express terms of a valid contract. See Mortgage Investors of Wash. v. Citizens Bank and Trust Co. of Md., 278 Md. 505, 509 (1976). The issue in the present case, then, was whether there exists an exception allowing a declaration requiring certain parties to be signatories to it in order for a modification to be effectual, to be modified with the written consent of less than all of the parties required by the original undertaking. This was an issue of first impression in Maryland.

Here, the Court of Special Appeals adopted the rule enunciated in the California case Hotle v. Miller, holding that two parties to a tripartite agreement may modify the original agreement, provided such modification in no way prejudices the interests of the third, non-consenting party. See Hotle v. Miller, 334 P.2d 849 (Cal.1959). However, adoption of the Hotle rule did not end the Court’s inquiry as to whether the 1992 declaration, which was executed by only two of the three parcel owners, was valid. Instead, application of the Hotle rule operated to shift the inquiry to the question of whether the Parcel Three owners were prejudiced by the 1992 declaration; if so, the 1992 declaration might be nothing more than an unsuccessful attempt to modify and replace the 1981 declaration.

Because the restrictions on development contained in the 1992 declaration were entirely consistent with, and did not affect, or conflict with, any right that the Parcel Three Owners had under the 1981 declaration, 600 North Frederick’s contention that the 1992 declaration was invalid because it was not joined by the Parcel Three owners was contrary to settled contract law. Absent extrinsic evidence to the contrary, nothing in the 1992 declaration seemed to affect the rights of the relevant owners of Parcel Three to develop Parcel Three, then-existing under the 1981 Declaration. Nevertheless, the Court of Appeals held that it would be unfair, without giving the relevant owners of Parcel Three an opportunity to be heard, to declare affirmatively that, because the current record was devoid of any demonstrable evidence of prejudice to the owners of Parcel Three, they would suffer no prejudice from the 1992 Declaration.

Therefore, the Court of Appeals held that on remand, the owners of Parcel Three should be permitted to weigh in, as parties or otherwise, if they wish, and the circuit court to offer and, if necessary, conduct an evidentiary hearing, with the goal of determining whether the owners of Parcel Three are prejudiced by the 1992 declaration. In the event that the circuit court determines they are not so prejudiced or if, after notice, the owners of Parcel Three fail to assert any prejudice, the circuit court’s declaration that the 1992 declaration is valid and enforceable should stand. If, on the other hand, the circuit court determines, upon an adequate and persuasive showing, that the owners of Parcel Three are prejudiced by the 1992 Declaration, it may reconsider its earlier declaration that the 1992 Declaration is valid.

600 North Frederick next argued that, if the 1992 declaration was found to be valid and enforceable, the “onerous restrictions” of the 1992 declaration were never were intended to be applied to the owner Parcel Two and that it applies merely to third-party developers. In the present case, the meaning of the 1992 Declaration was abundantly clear that the stated restrictions were to apply whether or not future improvements were undertaken pursuant to the ground lease. Because the 1992 declaration was clear facially that its development restrictions were to apply equally to the owner of Parcel Two as to third-party developers, it was unnecessary to consider the circumstances surrounding the execution of the instrument. Therefore, barring an adequate and persuasive showing of prejudice to the owners of Parcel Three (a determination that may be made on remand), the 1992 declaration was a valid and enforceable modification of the 1981 declaration, and the restrictions in the 1992 declaration apply with equal force to 600 North Frederick as they do to third-party developers of Parcel Two.

Accordingly, judgment of the Court of Special Appeals was vacated and the case remanded to the circuit court.

COMMENTARY: The Court of Appeals also considered the validity of the circuit court’s finding that BCF did not unreasonably withhold its consent to the construction of the JPI development. It was concluded that there was substantial evidence in the record supporting the circuit court’s conclusion that BCF acted reasonably and in good faith in withholding consent to the JPI development on Parcel Two.

However, the circuit court’s rationale for why BCF’s withholding of its consent to the JPI development plan for Parcel Two was not unreasonable was not a “separate and independent basis” for the declaration by the circuit court. In other words, the circuit court, although tipping its hand as to the merits of whether the consent was withheld unreasonably, ruled ultimately that this declaration was “nothing more than an advisory opinion as to whether BCF was unreasonable in withholding its consent to a development contract.” As such, the circuit court’s memorandum opinion on this point could not constitute a “separate and independent basis” for its ruling, such that the failure to point to that basis on appeal would make the issues before this Court moot. See Bailiff, 169 Md.App. at 653.

Criminal Law

Voluntariness of plea

BOTTOM LINE: The plea colloquy was insufficient to show that, under the totality of the circumstances, the defendant knowingly and voluntarily entered into the guilty plea with understanding of the nature of the charge.

CASE: State v. Daughtry, No. 81, Sept. Term 2010 (filed April 25, 2011) (Judges Bell, HARRELL, Greene & Barbera) (Judges Murphy, Battaglia & Adkins dissenting). RecordFax No. 11-0425-24, 57 pages.

FACTS: Demetrius Daughtry was charged with murder, robbery, robbery with a deadly weapon, and use of a handgun in the commission of a felony or a crime of violence arising from the shooting death of Anthony Brown. Daughtry negotiated with the State to plead guilty to first-degree murder and use of a handgun in the commission of a felony or a crime of violence.

At the plea hearing, the court asked Daughtry whether he talked with his lawyer about the plea and whether it was his decision to take the plea. Daughtry responded yes.

The circuit court agreed to the sentencing terms of the plea agreement — life imprisonment, suspend all but 30 years — in exchange for Daughtry’s cooperation in the investigation and prosecution of Ashton.

Daughtry appealed, asserting that his plea should be vacated because the circuit court judge did not determine on the record that defense counsel had advised him of the elements of first degree murder. The Court of Special Appeals vacated Daughtry’s convictions.

The State appealed to the Court of Appeals, which affirmed.

LAW: In Henderson v. Morgan, 426 U.S. 637 (1976), Henderson, indicted initially for first-degree murder, pleaded guilty to second-degree murder, and was sentenced to a term of imprisonment of 25 years to life. See Henderson, 426 U.S. at 642. At the plea hearing, in direct colloquy with the trial judge, Henderson stated that his plea was based on the advice of his attorneys. There was no discussion of the elements of the offense of second-degree murder, no indication that the nature of the offense had ever been discussed with Henderson, and no reference of any kind to the requirement of intent to cause the death of the victim. Henderson, 426 U.S. at 642–43.

Henderson initiated proceedings in state court to have his guilty plea vacated on grounds that he entered into the plea involuntarily, which proved unsuccessful. See Henderson, 426 U.S. at 638–39. Henderson filed a petition for writ of habeas corpus in federal court. The district court denied Henderson’s petition for writ of habeas corpus. See id.

The 2nd Circuit reversed and remanded. On remand, the district judge concluded that Henderson “was not advised by counsel or court, at any time, that an intent to cause … the death of the victim was an essential element of Murder 2nd degree”; thus, that the plea was involuntary. Henderson, 426 U.S. at 640. The 2nd Circuit affirmed. See id.

The Supreme Court held that “it is impossible to conclude that his plea to the unexplained charge of second-degree murder was voluntary,” considering that there was nothing in the record suggesting that Henderson had the requisite intent for murder, or that Henderson had been aware that intent was a necessary element of murder. Henderson, 426 U.S. at 646.

“Normally the record contains either an explanation of the charge by the trial judge, or at least a representation by defense counsel that the nature of the offense has been explained to the accused. Moreover, even without such an express representation, it may be appropriate to presume that in most cases defense counsel routinely explain the nature of the offense in sufficient detail to give the accused notice of what he is being asked to admit.” Id. at 64.

Although the Supreme Court mentioned a “presumption,” it did not apply it to the facts in Henderson. Accordingly, in Henderson, because the presumption was not necessary to the Court’s holding, the discussion of the presumption was clear dicta. See Miller v. State, 185 Md.App. 293 (2009).

Rule 731, the predecessor to Rule 4–242(c), stated: “c. Plea of Guilty The court may not accept a plea of guilty without first questioning the defendant on the record to determine that the plea is made voluntarily, with understanding of the nature of the charge and the consequences of the plea.”

State v. Priet, 289 Md. 267, 275 (1981), was decided under Rule 731. In Priet, the Court considered three consolidated criminal cases. The Court found that Rule 731(c) does not impose any fixed procedure to guide the trial judge in determining whether a guilty plea is voluntarily and intelligently entered. Rather, the test “is whether, considering the record as a whole, the trial judge could fairly determine that the defendant understood the nature of the charge to which he pleaded guilty.” Id. at 291.

In 1984, Rule 731(c) was re-numbered Rule 4–242(c) and provided: “The court may accept a plea of guilty only after it determines, upon an examination of the defendant on the record in open court … that (1) the defendant is pleading voluntarily, with understanding of the nature of the charge and the consequences of the plea.”

In Bradshaw v. Stumpf, 545 U.S. 175 (2005), a defendant pleaded guilty to aggravated murder and was sentenced ultimately to death. Later, the defendant moved to withdraw his guilty plea. Id. at 182. The 6th Circuit held that Stumpf’s guilty plea was involuntary because “he was manifestly not aware that specific intent was an element of the crime to which he plead guilty.” Stumpf v. Mitchell, 367 F.3d 594, 596 (6th Cir.2006).

The Supreme Court reversed the 6th Circuit’s conclusion that defendant’s plea was not entered voluntarily and knowingly. In Stumpf’s plea hearing, his attorneys represented on the record that they had explained to their client the elements of the aggravated murder charge and Stumpf himself then confirmed that this representation was true. The Court stated that the constitutional prerequisites of a valid plea may be satisfied where the record accurately reflects that the nature of the charge and the elements of the crime were explained to the defendant by his own, competent counsel. Where a defendant is represented by competent counsel, the court usually may rely on that counsel’s assurance that the defendant has been properly informed of the nature and elements of the charge to which he is pleading guilty.” Bradshaw, 545 U.S. at 183.

The Supreme Court’s decision in Bradshaw did not affect the limited viability of the presumption as set forth originally in dicta in Henderson. Bradshaw does not acknowledge any presumption that counsel, in most cases, explains the nature of the charges to his or her client. This, however, is unremarkable, as the Court did not need to employ the presumption because Stumpf’s attorneys represented on the record that they had explained to him the elements of the aggravated murder charge Bradshaw, 545 U.S. at 183. Thus, to the extent that a presumption was identified in Henderson, it was unaffected by Bradshaw.

Rule 4–242(c) requires “an examination of the defendant on the record in open court.” Where the record reflects nothing more than the fact that a defendant is represented by counsel (as in the present case) and that the defendant discussed generically the plea with his or her attorney, such a plea colloquy is deficient under Rule 4–242(c), and the plea must be vacated. The test, in determining whether a guilty plea is voluntary under current Rule 4–242(c), is whether the totality of the circumstances reflects that a defendant knowingly and voluntarily entered into the plea.

It does not matter whether (1) the defendant informs the trial court that either he understands personally or was made aware by, or discussed with, his attorney the nature of the changes against him, see Gross v. State, 186 Md.App. 320 (2009); (2) the attorney informs the trial court that he informed his client of the charges against the client, see Bradshaw, 545 U.S. at 183; or (3) the trial court itself informs the defendant of the charges against the defendant, see Abrams v. State, 176 Md.App. 600 (2007). The presence of any one of these scenarios on the record is strong evidence, absent other circumstances tending to negate a finding of voluntariness that the defendant entered the guilty plea knowingly and voluntarily.

In the present case, none of these indicia were present. It may be that, in answering in the affirmative to the trial court’s question, “Have you talked over your plea with your lawyer?”, the defendant understood merely the terms of the plea, but not the nature of the charges to which he plead guilty.

Because Rule 4–242(c) requires an “on the record” examination before accepting a plea as voluntary, it should not be presumed that an attorney explained the elements to the defendant unless there is some factual basis in the record to support the presumption. Here, there was no such factual basis. Thus, based on the totality of the circumstances, Daughtry’s plea was not entered knowingly and voluntarily.

Accordingly, the judgment of the Court of Special Appeals was affirmed.

COMMENTARY: Where “a decision of this Court with regard to a constitutional provision, a statute, or a common law principle, is overruled on the ground that the decision represented an erroneous interpretation or application of the constitutional provision, statute, or common law principle, the question of whether the new ruling should be applied prospectively only is governed by the principles set forth in Owens–Illinois[, Inc.] v. Zenobia, 325 Md. 420, 470–72 (1992).” Walker v. State, 343 Md. 629, 637, 6 (1996).

“[T]he question of whether a particular judicial decision should be applied prospectively or retroactively, depends in the first instance on whether or not the decision overrules prior law and declares a new principle of law. If a decision does not … no question of a ‘prospective only’ application arises; the decision applies retroactively in the same manner as most court decisions.” Houghton v. County Comm’rs of Kent County, 307 Md. 216, 220 (1986).

Maryland law, with respect to the voluntariness of guilty pleas, has been the same over the past thirty years: “[W]hether, considering the record as a whole, the trial judge could fairly determine that the defendant understood the nature of the charge to which he pleaded guilty.” Priet, 289 Md. at 291. The Court reaffirmed this “totality of the circumstances” approach to determining the voluntariness of guilty pleas.

Thus, the decision in the present case in no way “overrules prior law and declares a new principle of law.” See Houghton, 307 Md. at 220. It is consistent entirely with Rule 4–242(c), its predecessor, and attendant case law. Therefore, the opinion was given full retrospective effect.

DISSENT: The record showed that Daughtry (1) gave a detailed confession to the investigating officers, in which he confessed to his role in the armed robbery that resulted in the murder of the robbery victim, (2) aided in the investigation of that crime, which resulted in the arrest of his co-defendant, (3) entered into a plea agreement in which he promised to testify against his co-defendant, and during which he answered “Yes” when asked by the Court whether the facts stated by the prosecutor were “what happened in this case?,” (4) breached his plea agreement when called to testify during the trial of his codefendant, and (5) at sentencing, requested “mercy” on the ground that, “but for” his cooperation, the State’s case against his co-defendant would not have been likely to “come to trial.”

According to the dissent, therefore, from a review of the record as a whole, when Daughtry entered the guilty pleas at issue, he fully understood the nature of the charges to which he pleaded guilty.

PRACTICE TIPS: “[W]here it is alleged that an individual is mentally retarded, the trial court must consider that factor when determining whether an individual has the mental capacity to achieve the necessary understanding of a guilty plea.” Edwards v. United States, 766 A.2d 981, 991 (D.C.2001).

Criminal Procedure

Voir dire objections

BOTTOM LINE: By raising his objection to a bifurcated jury selection process when the court announced that it was going to run out of prospective jurors, defendant sufficiently preserved his objection for appeal.

CASE: State v. Tejada, No. 103, Sept. Term, 2009 (filed Apr. 26, 2011) (Judges Bell, Harrell, Greene, Murphy, Adkins & BARBERA). RecordFax No. 11-0426-22, 27 pages.

FACTS: In October 2007, Emanuel Tejada and a co-defendant stood trial in circuit court on various charges stemming from an attempted robbery of an armored truck. The trial was scheduled to take seven days. The jury selection process began with a venire of 60 prospective jurors. The trial court dismissed 17 of them for cause, leaving 43 venirepersons for the peremptory challenge phase of the process. Tejada and his co-defendant were each entitled to exercise 20 peremptory challenges and the State, 20 (10 per defendant).

Midway through the peremptory challenges, the court noted that because the parties had more peremptory strikes left than there were prospective jurors remaining, it appeared that they were going to run out of jurors. The trial judge requested additional venirepersons. However, when the proceedings resumed after the luncheon recess, the court instructed the lawyers that the additional prospective jurors were not able to stay for the duration of the trial and that therefore there was no point continuing with the jury selection. The court told the parties that they had two options: they could dismiss all of the jurors and prospective jurors and begin the juror selection process all over again the following day; or, they could agree to keep the seven or eight jurors that had been selected, and select the remaining jurors the following morning.

Counsel for Tejada’s co-defendant indicated a desire to start over with the entire jury selection process the following day. The State opposed that proposal. The court then dismissed the jurors for the evening. The following morning, the court announced that because there had not been enough people in the previous day’s panel to complete the selection process, an additional group of prospective jurors would be brought in so that the parties could select the remaining 12 or 16 jurors needed. Tejada’s counsel formally objected to the bifurcated jury selection, and counsel for Tejada’s co-defendant continued her objection.

After the court began voir dire of the new panel, the co-defendants’ counsels again raised objections to the bifurcated selection process. In response, the trial judge told the defendants’ attorneys that he could dismiss the jurors immediately and start over the selection process, and their objections would then “go away.” Counsel for Tejada’s co-defendant expressed concern that if they dismissed the jurors, they would once again be left with not enough prospective jurors to select a full jury. The judge responded that if counsel wished to excuse the nine jurors that had been picked that day, he would reserve ruling on the objection. The court then resumed the voir dire.

Shortly thereafter, the court and the parties discussed how long the selection process was taking. The court noted that the option of starting over was not a “real option” because there were no more jurors available that day. The court added that it was not depriving the parties of the option to start over the process, but that if the parties chose to do so, it would be necessary to bring in additional venirepersons the following day. Tejada’s counsel responded, “Your Honor, given Your Honor’s statement just now, my client would waive that objection.”

The parties returned after a recess, at which time counsel for Tejada’s co-defendant renewed her objection and requested that a new panel of 150 prospective jurors be brought in the following day. The trial judge overruled the objection. Following some discussion, Tejada’s attorney stated that he had misunderstood the court’s position, and that he retracted any previous waiver of his objection and joined in the objection of the co-defendant’s counsel. The court responded, “Very well. Overruled.” The parties then resumed jury selection, during which Tejada exercised the remainder of his peremptory strikes.

The jury found Tejada guilty of multiple offenses. Tejada appealed to the Court of Special Appeals, arguing, among other things, that trial court erred in its manner of conducting the jury selection process. The State countered that Tejada had failed to preserve the claim for appellate review and that even if the claim was properly before the appellate court, it had no merit. The Court of Special Appeals held that Tejada had preserved the claim for appellate review and that the trial judge erred by conducting a bifurcated jury selection process. The Court of Special Appeals vacated the judgments and remanded Tejada’s case for a new trial.

The State appealed to the Court of Appeals, which affirmed.

LAW: As in the present case, King v. State Roads Comm’n. King v. State Roads Comm’n., 284 Md. 368 (1979) presented the issue of whether the petitioners had preserved their appellate objections by timely challenging the jury selection process in the trial court. The King Court emphasized that when a rule clearly sets forth the jury selection procedure to be followed, any dissatisfaction with the technical procedure actually utilized must be expressed for the record before the jury is sworn unless it can be shown that the complaining party both did not know and, with reasonable diligence, could not have known of the irregularity.

At the time of Tejada’s trial, the applicable Maryland Rule, Rule 4–312(g) stated, “Before the exercise of peremptory challenges, the court shall designate from the jury list those jurors who have qualified after examination.” Based on this Rule, the State contended that Tejada was required to object prior to the exercise of his peremptory challenges because by that time, Tejada knew that too few potential jurors remained to produce a full jury after accounting for all the peremptory challenges afforded to the parties. The State argued that by not objecting before the exercise of any peremptory challenges, Tejada waived any objection to the size of the venire.

When read in its entirety, Rule 4–312 does not require that an objection to the number of qualified jurors designated by the court be made before the exercise of any peremptory challenges; had such a requirement been intended, the Rule itself would have said so explicitly. Thus, Rule 4–323(c) did not require Tejada to object to the jury selection process before the parties began to exercise their peremptory challenges. Rather, that Rule required merely that a party object to a court ruling or order “at the time the ruling or order is made or sought.” In this case, the ruling or order that was “made or sought” came, at the soonest, when the court announced that the parties were “going to run out of jurors.”

Thus, no fair reading of Rule 4–323(c) obligated Tejada to raise the concern at that time, lest he waive any claim of error attendant to whatever action the court subsequently might take to remedy the problem. Tejada “made known to the court his objection to the ruling at the time the ruling was made,” which was all that Rule 4–323(c) required. See Bundy v. State, 334 Md. 131, 138 (1994).

Accordingly, the judgment of the Court of Special Appeals was affirmed.

COMMENTARY: The State also contended that Tejada waived appellate review by continuing to exercise peremptory challenges after he and his co-defendant had raised the issue of the insufficient venire. Specifically, the State argued that Tejada’s exercise of challenges after his initial objection was “directly inconsistent” with his claim that he desired to have a sufficiently large venire for jury selection.

Maryland courts have long deemed the right of peremptory challenge a most essential one to a prisoner, and one which is highly esteemed and protected in the law. See Turpin v. State, 55 Md. 462, 464 (1881). There is no Maryland caselaw holding stating that a party’s continued exercise of peremptory challenges waives appellate review of earlier phases of the jury-selection process. Indeed, such a rule would undermine the purpose of CJ §8–420 and Rule 4–313, which is to recognize the right of peremptory challenge. Thus, where a party’s objection was a general one not directly aimed at the composition of the jury ultimately selected, the objecting party’s approval of the jury as ultimately selected does not explicitly or implicitly waive his previously asserted objection, and this objection is preserved for appellate review. Gilchrist v. State, 340 Md. 606, 618 (1995).

In this case, Tejada objected early on to the size of the venire, and then continued to exercise peremptory strikes after the trial court indicated that it would bring in an additional panel of jurors later that same day. The next day, Tejada exercised his remaining challenges, and never stated that the final jury, as chosen, was acceptable. There is no Maryland authority which requires a party to choose, on the one hand, between exercising all of his peremptory challenges and thereby waiving appellate review of deficient jury selection procedures, and, on the other hand, and not exercising all of his or her challenges and thereby facing a potentially less desirable jury at trial.

Thus, Tejada’s exercise of peremptory challenges was not inconsistent with a request for a venire containing a sufficient number of jurors. As such, Tejada did not waive his right to appeal the bifurcated jury selection process by continuing to exercise the peremptory challenges available to him.

PRACTICE TIPS: The number of peremptory challenges available to each party in a criminal case is based on the flagship charge and its potential penalty. In a case in which one or more defendants are charged with any single count which carries the possibility of a life sentence upon conviction, each defendant is permitted 20 peremptory challenges and the State is permitted ten peremptory challenges for each defendant.



BOTTOM LINE: Pages allegedly printed from the defendant’s girlfriend’s MySpace profile were not properly authenticated, and, therefore, the defendant was entitled to a new trial.

CASE: Griffin v. State, No. 74, Sept. Term, 2010 (filed April 28, 2011) (Judges Bell, BATTAGLIA, Greene, Adkins & Barbera) (Judges Harrell & Murphy dissenting). RecordFax No. 11-0428-20, 30 pages.

FACTS: Antoine Griffin was charged in numerous counts with the shooting death of Darvell Guest. During trial, the State sought to introduce the MySpace profile or Griffin’s girlfriend, Jessica Barber, to demonstrate that, prior to trial, Ms. Barber had threatened a State witness.

The printed pages contained a MySpace profile in the name of “Sistasouljah,” describing a 23 year-old female from Port Deposit, listing her birthday as “10/02/1983” and containing a photograph of an embracing couple. The printed pages also contained the following blurb: “FREE BOOZY!!!! JUST REMEMBER SNITCHES GET STITCHES!! U KNOW WHO YOU ARE!!”

When Ms. Barber had taken the stand after being called by the State, she was not questioned about the pages allegedly printed from her MySpace profile. Instead, the State attempted to authenticate the pages, as belonging to Ms. Barber, through the testimony of Sergeant John Cook, the lead investigator in the case.

Defense counsel was permitted to voir dire Sergeant Cook, outside of the presence of the jury. The trial judge, thereafter, indicated that he would permit Sergeant Cook to testify in support of authentication of the redacted portion of the pages printed from MySpace.

The circuit court convicted Griffin of second-degree murder and other charges. The Court of Special Appeals affirmed, determining that the trial judge did not abuse his discretion in admitting, without proper authentication, what the State alleged were several pages printed from Griffin’s girlfriend’s MySpace profile.

Griffin appealed to the Court of Appeals, which reversed.

LAW: Social networking websites have been described as “sophisticated tools of communication where the user voluntarily provides information that the user wants to share with others.” Independent Newspapers, Inc. v. Brodie, 407 Md. 415, 424 n. 3 (2009). A number of social networking websites, such as MySpace, enable members “to create online ‘profiles,’ which are individual web pages on which members [can] post photographs, videos, and information about their lives and interests.” Doe v. MySpace, Inc., 474 F.Supp.2d 843, 845 (W.D.Tex.2007). Anyone can create a MySpace profile at no cost, as long as that person has an email address and claims to be over the age of fourteen. There is no law that prevents someone from establishing a fake account under another person’s name, so long as the purpose for doing so is not to deceive others and gain some advantage.

Thus, online social networking poses two threats: that information may be (1) available because of one’s own role as the creator of the content, or (2) generated by a third party, whether or not it is accurate. See Montes, Living Our Lives Online: The Privacy Implications of Online Social Networking, Journal of Law and Policy for the Information Society, Spring 2009, at 507, 508.

Authentication is generally governed by Rule 5–901, which provides: “(a) General provision. The requirement of authentication or identification as a condition precedent to admissibility is satisfied by evidence sufficient to support a finding that the matter in question is what its proponent claims.”

Potential methods of authentication are illustrated in Rule 5–901(b). Rules 5–901(b)(1) and 5–901(b)(4) state: “By way of illustration only, and not by way of limitation, the following are examples of authentication or identification conforming with the requirements of this Rule: (1) Testimony of witness with knowledge. Testimony of a witness with knowledge that the offered evidence is what it is claimed to be. (4) Circumstantial evidence. Circumstantial evidence, such as appearance, contents, substance, internal patterns, location, or other distinctive characteristics, that the offered evidence is what it is claimed to be.”

Here, the trial judge abused his discretion in admitting the MySpace evidence pursuant to Rule 5–901(b)(4), because the picture of Ms. Barber, coupled with her birth date and location, were not sufficient “distinctive characteristics” on a MySpace profile to authenticate its printout, given the prospect that someone other than Ms. Barber could have not only created the site, but also posted the “snitches get stitches” comment. The potential for abuse and manipulation of a social networking site by someone other than its purported creator and/or user leads to the conclusion that a printout of an image from such a site requires a greater degree of authentication than merely identifying the date of birth of the creator and her visage in a photograph on the site in order to reflect that Ms. Barber was its creator and the author of the “snitches get stitches” language.

Other courts, called upon to consider authentication of electronically stored information on social networking sites, have suggested greater scrutiny because of the heightened possibility for manipulation by other than the true user or poster. In Commonwealth v. Williams, 926 N.E.2d 1162 (Mass.2010), the defendant was convicted of the shooting death of Izaah Tucker, as well as other offenses. The witness, Ashlei Noyes, testified that she had spent the evening of the murder socializing with the defendant and that he had been carrying a handgun. She further testified that the defendant’s brother had contacted her “four times on her MySpace account between Feb. 9, 2007, and Feb. 12, 2007,” urging her “not to testify or to claim a lack of memory regarding the events of the night of the murder.” Id. at 1172.

At trial, Noyes testified that the defendant’s brother, Jesse Williams, had a picture of himself on his MySpace account and that his MySpace screen name or pseudonym was “doit4it.” She testified that she had received the messages from Williams, and the document printed from her MySpace account indicated that the messages were in fact sent by a user with the screen name “doit4it,” depicting a picture of Williams. Id.

The Supreme Judicial Court of Massachusetts determined that there was an inadequate foundation laid to authenticate the MySpace messages, because the State failed to offer any evidence regarding who had access to the MySpace page and whether another author, other than Williams, could have virtually-penned the messages. See id. at 1173. See also People v. Lenihan, 911 N.Y.S.2d 588 (N.Y.Sup.Ct.2010).

The MySpace printout here was used to show that Ms. Barber had threatened a key witness, who the State had characterized as “probably the most important witness in this case;” the State highlighted the importance of the “snitches get stitches” posting during closing argument. In addition, during rebuttal argument, the State again referenced the pages printed from MySpace, asserting that Ms. Barber had employed MySpace as a tool of intimidation against a witness for the State. It was clear, then, that the MySpace printout was a key component of the State’s case. Thus, the error in the admission of its printout required reversal and Griffin was entitled to a new trial.

Accordingly, the judgment of the Court of Special Appeals was reversed.

COMMENTARY: There are times when printouts from social networking sites could be admitted. The first method of authentication would be to ask the purported creator if she indeed created the profile and also if she added the posting in question, i.e. “[t]estimony of a witness with knowledge that the offered evidence is what it is claimed to be.” Rule 5–901(b)(1).

The second option may be to search the computer of the person who allegedly created the profile and posting and examine the computer’s internet history and hard drive to determine whether that computer was used to originate the social networking profile and posting in question.

A third method may be to obtain information directly from the social networking website that links the establishment of the profile to the person who allegedly created it and also links the posting sought to be introduced to the person who initiated it. This method was apparently successfully employed to authenticate a MySpace site in People v. Clevenstine, 891 N.Y.S.2d 511 (N.Y.App.Div.2009).

DISSENT: According to the dissent, a reasonable juror could have concluded, based on the presence on the MySpace profile of (1) a picture of a person appearing to Sergeant Cook to be Ms. Barber posing with Griffin; (2) a birth date matching Ms. Barber’s; (3) a description of the purported creator of the MySpace profile as being a twenty-three year old from Port Deposit; and (4) references to freeing “Boozy” (a nickname for Griffin), that the redacted pages contained information posted by Ms. Barber. Thus, the picture of Ms. Barber, coupled with her birth date and location, were sufficient “distinctive characteristics” on the profile to authenticate its redacted printout.

PRACTICE TIPS: Authentication concerns attendant to e-mails, instant messaging correspondence, and text messages differ significantly from those involving a MySpace profile and posting printout, because such correspondences is sent directly from one party to an intended recipient or recipients, rather than published for all to see. See, e.g., Independent Newspapers, Inc. v. Brodie, 407 Md. 415, 423 (2009); States v. Safavian, 435 F.Supp.2d 36, 41 (D.D.C.2006).

Insurance Law

Uninsured/underinsured motorist benefits

BOTTOM LINE: Plaintiff was not entitled to uninsured/underinsured motorist benefits under his father’s insurance policy because an unambiguous exclusion in the policy clearly precluded coverage of plaintiff’s claim.

CASE: Government Employees Insurance Company v. Comer, No. 19, Sept. Term 2008 (filed April 26, 2011) (Judges Bell, Harrell, Battaglia, Murphy, Adkins, Barbera & ELDRIDGE (retired, specially assigned)). RecordFax No. 11-0426-20, 13 pages.

FACTS: Ray Comer was riding on his motorcycle when he was involved in an accident with Patsy Lee Frey. Comer sustained serious injuries as a result of this collision, and his medical expenses alone exceeded $200,000.

Comer’s motorcycle was insured by a motor vehicle insurance policy issued by Progressive Insurance Co. The policy carried uninsured/underinsured motorist limits in the amount of $50,000 per person.

At the time of the accident, Comer resided in his father’s home. His father owned two automobiles, both of which were insured under a Government Employees Insurance Company (GEICO) Family Automobile Insurance Policy (the Policy). This policy carried single limit uninsured/ underinsured motorist coverage in the amount of $300,000. In light of his residence, Comer qualified as an “insured” under the GEICO policy.

Ms. Frey’s automobile was insured by a policy issued by the Erie Insurance Company, which had maximum liability coverage of $100,000. Erie tendered the $100,000 policy limits to Comer.

After accepting the $100,000 liability insurance payment from Ms. Frey’s carrier, Comer also presented claims to his insurance carrier, Progressive, and to his father’s carrier, GEICO, for underinsured motorist benefits. Progressive denied Mr. Comer’s claim for underinsured motorist benefits, as the maximum uninsured/underinsured coverage under the Progressive policy was $50,000, and Comer was not eligible for any more benefits from Progressive because he had received $100,000 from the liability carrier. GEICO also denied Comer’s claim because he did not qualify for coverage under the Policy based on an exclusion in the Policy (the Exclusion).

Comer filed a complaint in the circuit court against GEICO, seeking a declaratory judgment, requesting a declaration that he was entitled to receive uninsured/underinsured motorist benefits under the GEICO insurance policy. Both sides filed motions for summary judgment.

The circuit court issued a declaratory judgment declaring that the Policy provided coverage to Comer for losses sustained in his accident, that there was no applicable exclusion in the Policy precluding that coverage, and that the coverage under the Policy was limited to $300,000 and was secondary to the coverage provided by Erie.

GEICO appealed to the Court of Special Appeals. The Court of Appeals issued a writ of certiorari prior to argument in the Court of Special Appeals and reversed.

LAW: Comer primarily relied upon the basic coverage language of the uninsured/underinsured motorist section of the Policy, which states: “We will pay damages for bodily injury and property damage caused by an accident which the insured is legally entitled to recover from the owner or operator of an uninsured motor vehicle arising out of the ownership, maintenance or use of that vehicle.”

Another provision in the uninsured/underinsured motorist section of the Policy stated: “When an insured occupies an auto or other motor vehicle not described in this policy, this insurance is excess over any other similar insurance available to the insured. The insurance which applies to the occupied auto or other motor vehicle is primary.”

The Exclusion stated: “Bodily Injury sustained by an insured while occupying a motor vehicle owned by an insured and not described in the declarations and not covered by the bodily injury and property damage liability coverages of this policy is not covered.”

The basic uninsured/underinsured coverage provision, and the paragraph dealing with primary/excess insurance, standing alone, may well indicate excess coverage for Comer under the Policy. The two provisions, however, did not stand alone.

The nature of an exclusion, dealing with a more specific circumstance, is to modify, or create an exception to, the broader coverage provisions. If the two coverage provisions of the Policy did not arguably cover Comer’s claim, there would be no need to consider any exclusions.

In Liberty Mutual Insurance v. State Farm, 262 Md. 305 (1971), the circuit court held that a motor vehicle accident was covered by a paragraph in the definitions section of its policy, and that an exclusion in another part of the policy could not remove coverage. The Court of Appeals reversed and held that there was no coverage. “The lower court … concluded that Liberty Mutual could not confer coverage in one part of the policy and take it away at another part of the policy. [H]owever, … almost all liability policies do just that by conferring broad coverage in the first part of the policy only to narrow that broad coverage by exclusions, conditions, etc., later in the policy.” Id. at 312.

The Exclusion here excluded from uninsured/underinsured motorist coverage bodily injury to an insured while the insured was occupying a vehicle owned by the insured, but not described in the declarations of the GEICO policy, and not covered by the liability provisions of that policy. The exclusion was not ambiguous and clearly precluded coverage of Comer’s claim under the Policy. Thus, Comer was not entitled to uninsured/underinsured motorist benefits under the Policy.

Accordingly, the judgment of the circuit court was reversed.

COMMENTARY: Comer argued that the Exclusion was not authorized by IN §19–509(f)(1), which provides: “An insurer may exclude from the uninsured motorist coverage required by this section benefits for: (1) the named insured or a family member of the named insured who resides in the named insured’s household for an injury that occurs when the named insured or family member is occupying … an uninsured motor vehicle that is owned by the named insured or an immediate family member of the named insured who resides in the named insured’s household.”

Comer was a family member of the named insured, resided in the named insured’s household, was occupying a motorcycle owned by him when he was injured, and the vehicle was not insured under the Policy. Comer’s motorcycle was “uninsured” under the declarations and liability coverage of the Policy. Comer’s motorcycle was clearly an underinsured motor vehicle.

In Powell v. State Farm Ins. Co., 86 Md.App. 98 (1991), the Court of Special Appeals held that an exclusion similar to the Exclusion was authorized by the statutory provision which is now codified as IN §19–509(f)(1). With respect to the statute, “the exclusionary language contained in Section 541(c)(2)(i) [now §19–509(f)(1)], that ‘an insurer may exclude from coverage … the named insured when occupying … an uninsured motor vehicle that is owned by … a member of his immediate family,’ was intended to permit exclusion of coverage for other family-owned vehicles not insured under the applicable policy. As we see it, the legislature was permitting an insurer to exclude other vehicles of an insured that were not insured under the policy at issue.” Id. at 108–109.

“To hold as appellant also urges, i.e., that his wife’s vehicle was not uninsured because it was covered under another policy, would be to permit an owner to buy excess coverage under one policy for one vehicle at a relatively small premium and coverage under a separate policy for his other vehicles at a lesser cost, and have the excess coverage of the first policy apply to the vehicles covered under the subsequent policies.” Id. at 110.

Accordingly, the Exclusion was authorized by IN §19–509(f)(1).

Real Property

Dual agency

BOTTOM LINE: Seller of real property was not entitled to refuse to pay an agreed-upon fee to the seller’s broker on the ground that the broker was a “dual agent” representing both the seller and the buyer of the property, because at the time of the sale, the broker was not representing both the seller and the buyer.

CASE: Wilkens Square, LLLP v. W.C. Pinkard & Col, Inc., No. 23, Sept. Term, 2010 (filed Apr. 26, 2011) (Judges Bell, Harrell, Battaglis, Greene, MURPHY, Adkins & Barbera). RecordFax No. 11-0426-23, 24 pages.

FACTS: W.C. Pinkard & Col, Inc. (Colliers Pinkard) was a commercial real estate broker in Baltimore and a client of Wilkens Square, LLLP, a real estate brokerage firm. Wilkens Square filed suit against Colliers Pinkard for breach of contract to recover unpaid broker’s fees that Wilkens Square had earned while acting as Colliers Pinkard’s broker in the sale of Colliers Pinkard’s real property located on Pratt Street in Baltimore.

Colliers Pinkard filed a three-count counterclaim asserting that, among other things, Wilkens Square materially breached the Listing Agreement by failing to disclose to Colliers Pinkard that it had previously entered into a buyer’s agency agreement with the purchaser of the property and was thus acting as a dual agent for both the purchaser, Charles McCann Investments (CMC), and Wilkens Square.

The circuit court entered judgment on a jury verdict in favor of Wilkens Square, and Colliers Pinkard appealed to the Court of Special Appeals, which affirmed the circuit court judgment.

Colliers Pinkard appealed to the Court of Appeals, which affirmed.

LAW: A “dual agent” is a licensed real estate broker, licensed associate real estate broker, or licensed real estate salesperson who acts as an agent for both the seller and the buyer or the lessor and the lessee in the same real estate transaction. Md.Code Ann., Bus. Occ. & Prof. (“BOP”), §17–530(5) (2004 Repl.Vol., 2009 Supp.). A “real estate broker” is an individual who provides real estate brokerage services. §17–101(n). Absent the knowing consent of the parties to a real estate transaction, the broker’s fiduciary relationship with his client precludes a “dual agency,” that is, the same broker representing both sides in the transaction.

A broker in a dual agency not consented to by both principals cannot recover a commission from either party to the transaction, as any commission paid would amount to a benefit conferred on a fiduciary who violated his duty in the transaction. Proof of dual agency must consist of evidence that the broker represented the opposite sides to a transaction when the transaction took place. Ricker v. Abrams, 263 Md. 509 (1971). Thus, in order to prevail in the case at bar, Colliers Pinkers was required to persuade the jury by a preponderance of the evidence that Wilkens Square “provided real estate brokerage services” to both Colliers Pinkard and CMC in the same real estate transaction, for consideration.

Here, it was undisputed that Colliers Pinkard did not represent CMC in the sale of the Pratt Street property, on June 14, 2006, and indeed did not represent CMC in any capacity after Dec. 31, 2005. It was also undisputed that Colliers Pinkard in fact represented Wilkens Square in the sale of the Pratt Street Property, and in the auction process that led to the sale of the Property to CMC. Under the holding in Ricker, and consistent with all of the Maryland dual agency cases, as a matter of law, Colliers Pinkard was not representing both sides to Pratt Street Property sale when the sale went forward or when the auction that resulted in the sale was held, and therefore was not in a dual agency respecting that transaction. When the auction and sale of the Pratt Street Property took place, Colliers Pinkard was representing one party to the transaction (Wilkens Square) and not the other (CMC). Under Ricker, there was not a dual agency when the sale took place, when the auction was held, or at any time after Dec. 31, 2005, as a matter of law.

The sole evidence at trial that showed that Colliers Pinkard had any business relationship with CMC at the same time it had a business relationship with Wilkens Square was that, from mid-November 2005, until Dec. 31, 2005, Colliers Pinkard had a contract with CMC to render general real estate purchase consulting services and also had a contract with Wilkens Square to market the Pratt Street Property for sale. However, the mere coexistence of the two contracts did not constitute a dual agency under Maryland law, as there was no inherent conflict in Colliers Pinkard’s contracts with the two entities. Collers Pinkard could properly perform its obligations under both contracts without necessarily breaching a fiduciary duty to one client or the other.

The only evidence adduced at trial that linked the Colliers Pinkard contracts with CMC and with Wilkens Square to the Pratt Street Property was that, in mid-December 2005, Colliers Pinkard recommended to CMC that its representatives view the Property, and that, later that same month, in response to CMC’s expressed interest in the property, Colliers Pinkard, as broker for Wilkens Square, added CMC to the list of entities to receive the Executive Summary about the property. Wilkens Square argued that, by recommending that CMC’s representatives view the Pratt Street Property, even though it was not valued in the $20 million dollar range, Colliers Pinkard was rendering real estate brokerage services to CMC, for a fee, respecting the purchase of the Pratt Street Property, at the same time it was representing Wilkens Square with respect to the sale of the same Property. Specifically, Wilkens Square asserted that Colliers Pinkard, by serving as a consultant to CMC with respect to the purchase of the Property, was providing “real estate brokerage services” to CMC as that term is defined by Maryland Code (2004 Repl.Vol., 2009 Supp.), §17-101(l) of the Business Occupations and Professions Article (BOP).

However, Colliers Pinkard’s agreement to present properties to CMC was not in conflict with its fiduciary obligations to Wilkens under the Listing Agreement. The mere recommendation that CMC consider properties worth less than $20 million generally, and that it consider the Pratt Street property specifically, did nothing to further CMC’s interest in purchasing the property, nor could it possibly be construed as adverse to Wilkens’s interest in selling the property. As otherwise stated, Colliers Pinkard never acted as CMC’s agent with respect to the sale of the Pratt Street property and thus could not have been a dual agent for the purpose of that transaction. In fact, the most logical inference to be drawn from the evidence presented is that Colliers Pinkard, in recommending that CMC look at the Property, was acting in its capacity as listing agent for the property, and thus seeking to advance the interests of Wilkens Square. At the very least, this evidence was insufficient to require a finding of dual agency as a matter of law. Instead, under the circumstances, the evidence presented at trial was at the very least sufficient to generate a question of fact regarding the issue of whether the brokerage agreement was applicable to the sale of the Pratt Street property.

Accordingly, the Court of Appeals affirmed the judgment of the Court of Special Appeals.

COMMENTARY: Wilkens Square additionally argued that it was entitled to judgment as a matter of law on its breach of fiduciary duty claim, which was based upon the theory that Colliers Pinkard was obligated to disclose the fact that it had entered into a brokerage agreement with CMC.

A real estate broker has a duty to disclose to his or her principal all facts or information which may be relevant or material in influencing the judgment or action of the principal in the matter. St. Paul at Chase Corp. v. The Manufacturers Life Ins. Co., 262 Md. 192, 215–216 (1971). Depending upon the facts and circumstances in a given case, there may be information in addition to or other than dual agency that is material to the principal, and therefore must be disclosed to the buyer. Failure to disclose such information may likewise result in a forfeiture of a broker’s commission. Sellner v. Moore, 251 Md. 391 (1968).

Here, Wilkens Square’s insistence that it wished to know about the CMC-Colliers Pinkard relationship was not alone sufficient to render that information material. Rather, as Wilkens Square itself argued, the Court was required to consider what a reasonable person in the principal’s position would wish to know under the facts and circumstances of the transaction in question. In this case, there was no objective evidence in this case that Colliers Pinkard’s contract with CMC to assist it in purchasing properties in the Baltimore City/Washington, D.C., metro area would have been material to Wilkens with respect to the ultimate sale of its property.

To be sure, if Colliers Pinkard had been in a dual agency with CMC and Wilkens respecting the Pratt Street Property, there would have been a fiduciary duty to disclose that fact. However, for the reasons discussed above, it was questionable whether there was any legally sufficient evidence of dual agency in this case. Moreover, if there was any such evidence at all, the jury decided as a matter of fact that a dual agency did not exist. There simply was no evidence of any other “material fact” — that is, a fact that reasonably would have had an impact one way or the other upon Wilkens Square’s decision to sell the property to CMC, that Colliers Pinkard had a duty to disclose, but did not.

Accordingly, the Court of Special Appeals did not err by refusing to enter judgment for Wilkens Square on that basis.

PRACTICE TIPS: Maryland employs an objective approach to contract interpretation, according to which, unless a contract’s language is ambiguous, a court will give effect to that language as written without concern for the subjective intent of the parties at the time of formation. Therefore, rather than acquiescing to the parties’ subjective intent, a court must consider the contract from the perspective of a reasonable person standing in the parties’ shoes at the time of the contract’s formation. In other words, the true test of what is meant is not what the parties to the contract intended it to mean, but what a reasonable person in the position of the parties would have thought it meant.


Firefighter’s rule

BOTTOM LINE: The firefighter’s rule barred a police officer’s claim against the state for the negligence of police dispatcher in reporting a shoplifting incident as an armed robbery and thereby causing the officer to engage in high-speed pursuit during which he was severely injured.

CASE: White v. State, No. 36, Sept. Term, 2009 (filed April 27, 2011) (Judges Bell, Harrell, Battaglie, Greene, Murphy, Adkins & BARBERA). RecordFax No. 11-0427-20, 24 pages.

FACTS: On the morning of Oct. 24, 2002, Richard White was on duty as a police officer for the town of Thurmont when Craig Main, an employee of Ace Hardware, placed a 911 call to report an incident that had just occurred at the store. The call was routed to the Maryland State Police Barrack in Frederick, where it was answered by the dispatcher, William Henrickson, of the Maryland State Police.

During the call, Main told Henrickson that someone had just robbed the Ace Hardware Store. Henrickson dispatched Main’s call to the police for assistance, describing the getaway vehicle and stating: “Frederick, all cars, an armed robbery just occurred at the Ace Hardware in Thurmont.”

White heard the call and located the suspects driving on a nearby roadway. White initiated pursuit, activating the lights on his cruiser, which automatically activated the dashboard video camera. White and several other police cruisers pursued the suspects over mostly rural, two-lane roads. White communicated to Henrickson that he was in sight of the vehicle intermittently throughout the chase.

During the chase, White lost control of his vehicle and collided with a tree. White suffered severe injuries.

White filed a complaint in circuit court, naming as defendants Henrickson and the State of Maryland, alleging that Henrickson was negligent in issuing the dispatch. White alleged that Henrickson owed White a duty to use reasonable care and/or the skill and care of a reasonably competent police dispatcher, and that Henrickson breached that duty of care when he requested emergency personnel response to an armed robbery at the Ace Hardware Store rather than a mere shoplifting, failed to inquire as to whether the suspects had shown or used any type of weapon during the incident prior to dispatching and/or requesting emergency personnel response, failed to make any substantive inquiry as to the threat posed by the suspects to the general public prior to dispatching and/or requesting emergency personnel response, and was in other ways careless, reckless and negligent. White’s claim against the State was based on the theory of respondeat superior and alleged negligent hiring/supervision and negligence in supervising 911 dispatch protocols.

Before trial, the court granted Henrickson’s motion to dismiss the complaint on the basis of qualified immunity. The court denied the State’s motion to dismiss the suit, which asserted, that the firefighter’s rule barred White’s claim.

At the conclusion of White’s case-in-chief, the State moved for judgment, asserting, among other grounds, that White was barred from recovery by operation of the firefighter’s rule and by his contributory negligence in conducting the pursuit. The court denied the motion.

The State then presented additional evidence of White’s contributory negligence, including expert testimony on the subject. At the close of all the evidence, the State re-asserted both the firefighter’s rule and contributory negligence as grounds for its renewed motion for judgment. The court granted the motion on both grounds. The Court of Special Appeals affirmed.

White appealed to the Court of Appeals, which affirmed.

LAW: The firefighter’s rule is based on public policy that recognizes the relationship between public safety officers, who have assumed certain occupational risks, and the public, whom those officers serve and protect. The doctrine generally prevents firefighters and police officers injured in the course of their duties from recovering tort damages from those whose negligence exposed them to the risk of injury. Southland Corp. v. Griffith, 332 Md. 704, 713 (1993). In 1925, Maryland joined a number of other states in recognizing this common-law rule, and, like its sister jurisdictions, grounded the doctrine on a theory of premises liability.

In Flowers v. Rock Creek Terrace, Maryland courts shifted the basis for the rule from premises liability as the undergirding rationale. Flowers v. Rock Creek Terrace, 308 Md. 432 (1987). The Flowers court traced the development of the rule in Maryland and elsewhere and concluded that the rule was best explained by public policy rather than the law of premises liability, reasoning that the very nature of the firefighter’s or police officer’s occupation limits the public safety officer’s ability to recover in tort for work-related injuries. Id. at 447. Notably, the implications of a fireman’s public function regardless of whether he was classified as a licensee or invitee upon the property. Flowers, 308 Md. at 442.

Thus, as a matter of public policy, firemen and police officers generally cannot recover for injuries attributable to the negligence that requires their assistance. This public policy is based on a relationship between firemen and policemen and the public that calls on these safety officers specifically to confront certain hazards on behalf of the public. A fireman or police officer may not recover if injured by the negligently created risk that was the very reason for his presence on the scene in his occupational capacity. Someone who negligently creates the need for a public safety officer will not be liable to a fireman or policeman for injuries caused by this negligence. Flowers, 308 Md. at 447–48.

However, the firefighter’s rule does not bar recovery of tort damages for all improper conduct. Id. at 448. Negligent acts not protected by the fireman’s rule may include failure to warn the firemen of pre-existing hidden dangers where there was knowledge of the danger and an opportunity to warn. Id. In addition, the firefighter’s rule does not bar suits against arsonists or those engaging in similar misconduct. Id. at 449. Finally, the rule does not cover acts which occur subsequent to the safety officer’s arrival on the scene and which are outside of his anticipated occupational hazards. Id. at 448.

Notwithstanding that the firefighter’s rule has its limits, the rule applies whenever the officer is injured by risks inherent in the dangerous occupation of firefighting and law enforcement, so long as the risks are directly related to “ the situation requiring the firefighter’s or police officer’s services. Hart v. Swaroop, Inc., 385 Md. 514, 529 (2005). Thus, when a firefighter enters upon property for the purposes of fighting a fire, he or she must generally bear the risk of being injured by causes relating to or arising out of the fire.

In this case, White argued that the firefighter’s rule did not apply because his injuries resulted from Henrickson’s negligence, which was independent of the cause for his services (the theft from the hardware store). In fact, however, White was called not to investigate the larceny at the hardware store, but to pursue the fleeing suspects. Thus, the direct impetus for White’s service was not the earlier larceny, but, rather, Henrickson’s negligent act of reporting the suspects as having fled an armed robbery. Under Maryland law, White’s suit against the State was clearly barred because White was injured by the negligently created risk that was the very reason for his presence on the scene in his occupational capacity. Flowers, 308 Md. at 447–48.

White’s contention that his injuries were the result of a preexisting hidden danger of which Henrickson had knowledge and opportunity to warn was also unpersuasive. To find that a public safety officer is owed a duty of care under this circumstance would require evidence that the alleged tortfeasor had engaged in knowing concealment or deceptive appearance, something like fraud, put in the path of the officer, as would render the danger a trap. Hart, 385 Md. at 526. There was no such evidence present here.

White’s argument that Henrickson’s negligent dispatch was not a foreseeable occupational risk was likewise without merit. White was injured when he was unquestionably in the process of performing the duty for which he was ordered — that is, to engage in a high-speed pursuit. See Hart, 385 Md. at 525. High-speed pursuits of suspected armed suspects come within the range of hazards that a police officer is expected to confront in the course of his or her duties on behalf of the public. Cf. Crews v. Hollenbach, 358 Md. 627, 653 (2000). Therefore, the firefighter’s rule applied to bar White’s claim.

Accordingly, the judgment of the Court of Special Appeals was affirmed.

COMMENTARY: White additionally argued that the firefighter’s rule was inapplicable to suits between public safety officers. However, White provided no reason, based either in law or policy, to limit application of Maryland’s firefighter’s rule to suits against citizens.

To adopt such a limitation on the rule would run counter to its underlying public policy, which recognizes that the very nature of the firefighter’s or police officer’s occupation limits the public safety officer’s ability to recover in tort for work-related injuries.

PRACTICE TIPS: The firefighter’s rule was conceived in Illinois in 1892 in a case involving a firefighter’s suit against a landowner for negligently maintaining an elevator that malfunctioned, causing the firefighter to be injured during his investigation of a fire. Some states have abolished the rule, believing it to be antiquated. Maryland still applies the rule, however, and has adopted the prevailing view that the standard of care owed to firefighters applies with equal force to police officers.