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Opinions – 1/9/12: Maryland Court of Appeals

Administrative Law

LEOBR statute of limitations

BOTTOM LINE: After law enforcement officer knowingly made a material false statement during an investigation of prior misconduct, law enforcement agency had one year from the day the false statement came to its attention to bring an administrative charge against the officer for making that false statement.

CASE: Robinson v. Baltimore Police Department, No. 17, Sept. Term, 2011 (filed Dec. 20, 2011) (Judges Bell, Harrell, Battaglia, Greene, Adkins & BARBERA & Eldridge (Retired, Specially Assigned)). RecordFax No. 11-1220-22, 16 pages.

FACTS: On February 22, 2007, an officer of the Baltimore Police Department arrested Teressa Houssain on a charge of prostitution. During the arrest, Houssain revealed that she had recently engaged in sexual intercourse with a “Sergeant Steve Robinson” of the BPD, after Robinson propositioned her for sex and brandished his firearm. The BPD’s Internal Investigation Division confirmed that the person with whom Houssain had had the sexual encounter was Gregory Robinson.

The matter was referred to the IID later on February 22, 2007. The matter was forwarded to the Baltimore County Police Department (“BCPD” to determine whether criminal charges should be brought against Robinson. On February 23, 2007, detectives from the BCPD interviewed Houssain and concluded her criminal allegations were unfounded. Having no criminal conduct to pursue, the Baltimore County Police returned the matter to the IID, for it to continue its administrative investigation of the incident. The IID conducted its investigation, and on May 22, 2007, the IID served Robinson with a Notification of Complaint, which alleged that on February 19, 2007, Robinson engaged in sexual misconduct while on duty.

The IID investigators interviewed Robinson on July 11, 2007, and again on August 1, 2007. During those interviews, Robinson claimed not to recognize or know Houssain and denied having any sexual contact with her. The IID discovered through its investigation the apparent falsity of a number of the statements, material to the investigation, that Robinson made during the July 11 and August 1 interviews.

On June 26, 2008, the BPD administratively charged Robinson with six violations of BPD General Orders. The charges arose out of Robinson’s alleged sexual conduct with Houssain on February 19, 2007 (Charges 1, 2, 4, and 5); his conduct over the course of his career with BPD (Charges 1 and 6); and his alleged false statements to IID investigators on July 11, 2007 and August 1, 2007 (Charge 3).

The false statement charge was based on BPD General Order C-2, 2-88, Rule 1, Section 17, which provides, “No member of the department shall knowingly make any false statement or misrepresentation of any material fact, oral or written, under any circumstances, with the intent to mislead any person or tribunal.”

On July 11, 2008, a charging committee of the BPD reviewed the charges. That committee agreed with the IID’s formal recommendation to terminate Robinson.

Robinson filed a complaint and petition to show cause in circuit court, alleging all six administrative charges were barred by the one-year statute of limitations set forth in the Law Enforcement Officers’ Bill of Rights (LEOBR), §3-106. The BPD moved for summary judgment, arguing that the false statement charge was not time-barred under §3-106(a), and that, in any event, all the charges, including the false statement charge, came within the ambit of §3-106(b), because all the charges related to “criminal activity.” Robinson filed an opposition and cross-motion for summary judgment, and continued to argue that all the charges were time-barred.

The circuit court granted the BPD’s cross-motion as it related to the false statement charge, but otherwise denied the motion and cross-motion, ruling there were disputes of material fact related to the remaining charges. Robinson voluntarily dismissed the balance of his claims in the complaint. He appealed the judgment. The Court of Special Appeals affirmed the circuit court judgment. Robinson then appealed to the Court of Appeals, which affirmed.

LAW: The question properly before the Court of Appeals implicated the statute of limitations of LEOBR §3-106, which provides that a law enforcement agency may not bring administrative charges against a law enforcement officer unless the agency files the charges within one year after the act that gives rise to the charges comes to the attention of the appropriate law enforcement agency official.

Robinson asserted that the act that gave rise to the false statement charge was the incident between him and Houssain, which came to the BPD’s attention on February 22, 2007, and, that, consequently, the false statement charge filed on June 26, 2008, was time-barred. He suggested that when the LEOBR is silent as on an issue (here, the issue of when the limitations period for a false statement charge is triggered), it should be interpreted in a manner that furthers procedural due process protections for the police officer, consistent with its legislative intent. Robinson further posited that it was reasonable to expect that the Legislature, when enacting §3-106(a), wanted the one-year investigatory period to include investigations into both the underlying misconduct and charges of false statements arising from the underlying investigation.

The “cardinal rule” of statutory construction is that the court ascertain and effectuate the real and actual intent of the Legislature. State v. Johnson, 415 Md. 413, 421 (2010). If the language of the statute is unambiguous and clearly consistent with the statute’s apparent purpose, a court will apply the statute as written. Id.

In this case, there was no room in the plain language of §3-106 for Robinson’s interpretation of it. Put simply, §3-106 is a statute of limitations, nothing more or less. See Baltimore Police Dep’t v. Etting, 326 Md. 132, 138 (1992). Section 3-106 does not even hint at establishing a framework for an investigative process, much less does it address, even implicitly, a relation back of subsequent, chargeable acts of misconduct by the subject officer that are made in response to, or connection with, an investigation of alleged prior misconduct. Moreover, nothing in Maryland case law or the legislative history of either the LEOBR generally, or §3-106 specifically supported Robinson’s contention that, that, in his words, would make it “reasonable to expect” as much from that section. Indeed, to arrive at Robinson’s interpretation of §3-106, it would be necessary to add language so as to reflect an intent not evidenced in the plain and unambiguous language of the statute. Johnson, 415 Md. at 421.

In addition, Robinson’s suggested interpretation of §3-106 could lead to absurd results, which Maryland courts are enjoined by our rules of construction to avoid. See Johnson, 415 Md. at 422. For instance, if an officer were to make a false statement during an interview conducted pursuant to a departmental investigation of an incident that had come to the attention of the law enforcement agency eleven months and 28 days earlier, and the falsity of that statement was not immediately apparent to the investigators, although subsequent investigation would reveal the falsity, then only one of two possible outcomes could follow. The first possibility is that a charge alleging the falsity would be filed within one to three days thereafter (depending on the month), without benefit of an investigation that might show reasonable grounds for the charge, in anticipation that the falsity of the statement would eventually, in the language of §3-106, “come to the attention of the appropriate law enforcement agency.” The second possibility is that the filing of the charge would be time-barred and thus, foregone.

This first result ought never be countenanced, and the second would directly contravene the General Assembly’s intent, reflected by §3-113 of the LEOBR, to proscribe material falsehoods made by an officer during a departmental investigation. Neither outcome could reasonably have been envisioned by the General Assembly in enacting §3-106.

As such, when a law enforcement officer knowingly makes a false statement, material to and during the investigation of prior misconduct, the officer commits an “act” that gives rise to a charge within the meaning of §3-106(a); therefore, pursuant to that subsection, the appropriate law enforcement agency has one year from the day the false statement comes to its attention to bring a charge against the officer for making that false statement. Applying our holding to the facts here, the false statement charge brought against Robinson on June 26, 2008, for false statements he made to the investigators on July 11, 2007, and August 1, 2007, came within the period of limitations set forth in §3-106(a).

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

COMMENTARY: The holding that the false statement charge fell within the limitations period of §3-106(a) properly disposed of the sole issue in the case. Therefore, the court did not reach the BPD’s contention that the limitations period of §3-106(a) was not applicable to the false statement charge because, pursuant to §3-106(b), the charge came within the exception for charges “that relate to criminal activity.”

PRACTICE TIPS: The court noted that in the context of discrimination claims, retaliation is a separate claim, though based on preceding acts. A retaliation claim requires an underlying act of engaging in protected activity (like complaining of unlawful discrimination), an adverse employment action, and a causal link between the two. The statute of limitations for the retaliation claim begins to run at the time of the adverse employment activity, not at the time of the underlying protected activity.

Criminal Law

Theft by deception

BOTTOM LINE: Vendor was improperly convicted of theft by deception in connection to his failure to perform eight construction contracts for detached homes, as there was no evidence that vendor lacked either a right to the money he received or an honest belief in that right, while there was evidence that the vendor gave value for the money he received in the way of advances to pay for the lots, as provided under the contracts.

CASE: State v. Coleman, No. 14, Sept. Term, 2011 (filed Dec. 15, 2011) (Judges Bell, Harrell, Battaglia, Greene, ADKINS, Barbera & Eldridge (Retired, Specially Assigned)). RecordFax No. 11-1215-20, 21 pages.

FACTS: In February and March of 2004, Leon Coleman entered into contracts to convey eight lots in a subdivision and build homes on those lots. The subdivision was called Kings Grant Court, a collection of eleven lots in Prince George’s County. Earlier that year, Coleman had acquired the right to purchase Kings Grant Court for $550,000. The contracts provided that the buyers would purchase the unimproved lots before their homes were constructed.

Seven of the eight contracts identified the price of the unimproved lots, which ranged from $89,959 to $100,000. For at least seven of the eight lots, this price was at or below the appraised value of the land at the times the contracts were executed. The total price under the contracts ranged from $256,000 to $360,891, inclusive of constructing the homes. The buyers paid for the unimproved lots by obtaining loans with an initial advance for the land purchase. At closing, Coleman used the initial advances to purchase one lot for each buyer and to convey title by deeds to them. He received $667,993.19 from the advances and used $500,000 of it to buy the lots. The remaining balance on the buyers’ loans was held in escrow by the lenders pursuant to a draw schedule under which Coleman would make draws to cover his ongoing construction costs.

To make draws, Coleman would have needed to certify that materials were received or work was done, that payment was due, and that the Bank had inspected and approved the work or materials. Coleman never applied for any construction draws, however, because construction never went forward. The only payments that Coleman received from the buyers were the initial land advances, used to purchase the lots, and amounts ranging from $900 to $3500 for paper work costs such as blueprints and site plans.

Construction never went forward because Coleman ran out of money before he was able to obtain the required permits. He had hired MDB Design Group LLC on June 30, 2004, to prepare drawings and designs and obtain the permits. His contract with MDB provided that its work would be completed by August 31, 2004. He also consulted a builder about the project and retained two individuals to process permits and provide real estate consulting. When MDB failed to obtain the permits by the deadline, Coleman contacted James Reid, CEO of Civtech Designs, Inc., to discuss replacing MDB.

Coleman extended MDB’s deadline to November 10, 2004, but MDB again failed to meet it, so he retained Civtech on November 12, 2004, to do the work. He notified the buyers of this change on December 3, 2004, stating that he would still be able to complete the project. By the end of December, however, Coleman’s operating account had a negative balance, and he began to ignore inquiries from the buyers. Ultimately, the buyers either filed for bankruptcy, had their lots foreclosed, or refinanced or modified their loans.

After Coleman failed to perform the eight construction contracts for detached homes, he was convicted of eight counts of theft by deception and eight counts of failure to escrow under the Md.Code (2009), §7-104(a) of the Criminal Law Article. Coleman appealed to the Court of Special Appeals, which reversed all 16 convictions, holding that the Deposits on New Homes Subtitle, §10-301(a) of the Real Property Article (“the Act”) did not apply to money received in exchange for land without a residential unit on it, and that there was insufficient evidence of intent to support the theft convictions.

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

LAW: The issue was whether the evidence was sufficient to conclude that Coleman intentionally deprived the buyers of their property, as required under the theft statute.

In order to prove Coleman’s guilt of theft by deception, the prosecution needed to prove that Coleman obtained control over property by willfully or knowingly using deception with one of these states of mind: (1) intends to deprive the owner of the property; (2) willfully or knowingly uses, conceals, or abandons the property in a manner that deprives the owner of the property; or (3) uses, conceals, or abandons the property knowing the use, concealment, or abandonment probably will deprive the owner of the property. Md.Code §7-104(b) of the Criminal Law Article.

The statute defines “deprive” as to withhold property of another permanently, for a period that results in the appropriation of a part of the property’s value, with the purpose to restore it only on payment of a reward or other compensation, or to dispose of the property or use or deal with the property in a manner that makes it unlikely that the owner will recover it. Criminal Law Article §7-101(c). Property can be “obtained,” for purposes of theft by deception, even when it is transferred to a third party. §7-101(g).

The requirement of intentional deprivation makes theft a specific intent crime. Jones v. State, 303 Md. 323, 340 (1985). Here, the State argued that Coleman’s intent to deprive was proved by the fact that he entered into the contracts, and took the initial advances, with no intent to perform them fully. Specifically, the State argued that the jury could have rationally concluded that Coleman never intended to perform based upon his failure to put monies he received from advances toward development of the property, the lack of diligence with which he pursued the development process, and his misrepresentations and his lack of responsiveness to inquiries about the development’s progress, both of which forestalled any legal action against him.

However, when a defendant has a right to receive money or property, he cannot be guilty of stealing it. See §7-101(j) of the Criminal Law Article. Indeed, even an honest belief in the right to receive money or property negates the mens rea element of theft. Sibert v. State, 301 Md. 141, 147-148 (1984). In this case, there was no evidence that Coleman lacked either a right to the money he received or “an honest belief” in that right. The evidence at trial showed that he gave value (i.e. conveyed the lots), for the money he received in the way of advances to pay for the lots, as provided under the contracts. In exchange for the initial draws and miscellaneous payments, the buyers received land and also construction blueprints. Coleman received no further payments or draws.

Nevertheless, the State argued that Coleman took money not only for the land and blueprints, but also for his promise to build the homes; thus, it argued, Coleman stole the money that he took in exchange for the promise to build, because he never intended to complete construction. However, the State produced no evidence to support this contention, except to note that Coleman received more for the lot sales than he paid for the land.

Importantly, there was no evidence that he received more than market value for the land he conveyed. Indeed, for at least seven of the eight lots, the price Coleman charged was at or below the appraised value of the land. In short, making a profit on a land transaction is not theft.

In addition, there was no evidence that Coleman used the money for anything but the Kings Grant Court project. With these facts, no rational jury could conclude that Coleman intentionally deprived the buyers of their money by overcharging for their lots and keeping the excess money with no intent to perform the rest of the contracts. Moreover, Coleman’s actions between the time of contract and the arrest manifested his intent to perform. These actions, continuing eight months after the contracts were signed, manifested Coleman’s intent to perform. Cf. People v. Riner, 600 N.E.2d 1308, 1310 (Ill.App.Ct.1992). As such, the evidence was insufficient to conclude that Coleman intentionally deprived the buyers of their property, as required under the theft statute.

Accordingly, the judgment of the Court of Special Appeals reversing Coleman’s convictions of theft by deception was affirmed.

COMMENTARY: The Deposits and New Homes Subtitle (the “Act”) in effect at the time of Coleman’s execution of the contracts and receipt of the land acquisition advances required a builder or vendor to escrow money received from buyers when, in connection with the sale and purchase of a new single-family residential unit which was not completed at the time of contracting the sale, the vendor or builder obligated the purchaser to pay and the vendor or builder received any sum of money before completion of the unit and grant of the realty to the purchaser. Maryland Code (1998, 2010 Repl.Vol.), §10-301(a) of the Real Property Article. The Act required the escrow account to be maintained until any of several enumerated events occurred. See Md.Code (1998, 2010 Repl.Vol.), §10-301(b) of the Real Property Article.

This escrow requirement, by its plain language, applied regardless of whether a residential unit was on the land. Such a requirement is sensible in the case of construction advances as a means to protect against builders who could abscond with advances before the home is completed. No such danger existed under Coleman’s contracts, however, because he did not apply for or receive any draws or advances for construction; instead, the contracts provided that construction costs would be financed through loan proceeds already held in escrow by the lenders.

Therefore, it would not make sense for the Legislature to have intended the Act to apply the escrow requirement to Coleman’s situation, because Coleman could not receive any advances with which he could abscond. As such, the clear and unambiguous language of the superseded Act indicated that it did not apply to transactions in which land is conveyed without a home.

PRACTICE TIPS: If a builder or vendor is required under Maryland law to establish an escrow account in connection with the sale and purchase of a new, not-yet-completed single-family residential unit, this escrow account must be maintained until: (1) the granting of a deed to the property on which the a completed residential unit is located to the purchaser; (2) the return of the money to the purchaser; or (3) the forfeiture of the sum by the purchaser, under the terms of the contract of sale.

Criminal Procedure

Verdict sheet

BOTTOM LINE: For purposes of Maryland Rule 4-326(d), which requires that a court disclose to counsel all “communications” between the court and the jury, verdict sheet completed by jury in defendant’s criminal trial was not a “communication” between the court and the jury, and trial court therefore did not err in failing to disclose the contents of the verdict sheet prior to dismissing the jury.

CASE: Ogundipe v. State, No. 54, Sept. Term, 2010 (filed Dec. 21, 2011) (Judges Bell, Harrell, Battaglia, GREENE, Murphy, Adkins & Barbera). RecordFax No. 11-1221-20, 44 pages.

FACTS: Olusegun Ogundipe was charged with multiple crimes stemming from his involvement in an incident that occurred on July 23, 2006, in which Jackson Rodriguez was killed, Tony Perry was seriously injured, and Steven Broadhead was assaulted. After a two-day trial, the judge issued instructions to the jury concerning its deliberations, explaining that the verdict sheet consisted of 12 questions relating to the 12 charges against Ogundipe. The trial judge instructed the jury to “consider” the second-degree murder charge if the jury’s answer to the corresponding first-degree charge was not guilty.

Reinforcing this instruction, the language in the verdict sheet instructed the jury, following the charge of first-degree murder of Rodriguez, “If your answer to Question 1 is not guilty, please consider Question 2. If your answer to Question 1 is guilty, please answer Question 3,” where Question 2 asked the jury to determine whether the defendant was guilty of second degree murder, and Question 3 asked about a separate charge.

The same language was employed for the charges of first-degree murder of Perry and the first-degree assaults of Rodriguez, Perry, and Broadhead. This instruction implied that if the jury found Ogundipe guilty of the charge in the first degree, the jury should skip the next question, containing the same charge in the second degree, and should presumably leave that question blank because it merely inquired about the lesser included offense.

The jury convicted Ogundipe of first-degree murder, attempted first-degree murder, two counts of first-degree assault, use of a handgun in the commission of a crime of violence, and wearing, carrying, and transporting a handgun. However, the jury did not follow verbatim the trial judge’s instructions on how to utilize the verdict sheet. Rather than leaving the second-degree offenses blank when it determined that Ogundipe was guilty of the first-degree offenses, the jury checked the boxes marked “NOT GUILTY.” For instance, the jury found Ogundipe guilty of the offense listed in Question 1, first degree murder of Rodriguez. Rather than leaving Question 2, second-degree murder of Rodriguez, blank, the jury instead checked the box marked “NOT GUILTY.” Pursuant to the instructions, however, the clerk did not ask the foreperson to recite the jury verdict for Questions 2, 4, 8, or 10, which contained the lesser included offenses for which the jury found Ogundipe guilty of the greater offenses.

Following his conviction, Ogundipe appealed to the Court of Special Appeals, arguing that the trial court erred in failing to disclose the contents of the verdict sheet prior to dismissing the jury. The Court of Special Appeals affirmed the convictions.

Ogundipe appealed to the Court of Appeals, which affirmed.

LAW: The Court of Appeals focused on Ogundipe’s objection to the contents of the verdict sheet and the trial court’s failure to disclose to counsel the verdict sheet. The question presented in the petition for writ of certiorari encompassed two separate issues: first, with regard to Ogundipe’s claim that there was an inconsistent or confusing verdict, the issue of whether the signed verdict sheet constituted the jury’s verdict; and second, whether the verdict sheet was a “communication” which was required to be disclosed under Maryland Rule 4-326(d).

The Maryland case Jones v. State discussed whether a verdict sheet constitutes the jury’s verdict. Jones v. State, 384 Md. 669 (2005). In Jones, four counts against the defendant relating to a robbery were submitted to the jury. Jones, 384 Md. at 675. After deliberations, when the jury returned to the courtroom, the courtroom clerk asked the foreperson for the verdict on three of the four counts, and the foreperson answered “guilty” on each of those three counts. Jones, 384 Md. at 675-76. The jury was then polled and the verdict was hearkened only as to the three counts. Jones, 384 Md. at 676-77. The clerk never inquired about the fourth count. Id. The completed verdict sheet, however, reflected that the jury marked Jones guilty on all four counts. Jones, 384 Md. at 676 n. 9. The verdict sheet was filed in the record, and Jones was later sentenced for all four counts. Jones, 384 Md. at 677.

Jones argued that the verdict as to the count that was not orally conveyed, polled, or hearkened should not stand because the jury foreman did not announce the guilty verdict in open court. The Court of Appeals agreed with Jones, reversing the judgment of the Court of Special Appeals and holding that substance will prevail over form even if the guilty verdict is not announced. Id. Thus, the Court of Appeals held, a verdict is not valid until orally conveyed and either polled or hearkened. Jones, 384 Md. at 678. In other words, for a verdict to be considered final in a criminal case it must be announced orally, and, as such, the verdict for the count which was not announced orally, polled, or hearkened, was not valid. Jones, 384 Md. at 685-86; see also State v. Santiago, 412 Md. 28, 40 (2009).

In the present case, while Ogundipe focused his argument on whether or not the verdict sheet was a communication, Ogundipe also implied that the verdict sheet itself was the verdict, referring to the verdict sheet as “the ultimate communication,” and arguing that a “large portion of the verdict…went unspoken and unaddressed.” Ogundipe claimed that the contents of the verdict sheet constituted “evidence of confusion, inconsistency, and potential acquittal.” Ogundipe also maintained that the verdict sheet evidenced an inconsistent verdict, stating that the verdict sheet showed him not guilty of lesser included offenses, yet guilty of the greater offenses as they pertained to each victim in the case.

Although Maryland courts have not specifically determined whether the verdict sheet itself constitutes the verdict of the jury, other jurisdictions have grappled with this exact issue and have determined that it does not. People v. Clark, 293 A.D.2d 624, 624 (N.Y. App.Div. 2002); People v. Boatwright, 297 A.D.2d 603 (N.Y. App.Div. 2002). Both Jones and Santiago support the holding that the contents of the verdict sheet do not constitute the jury’s verdict, and the logic employed by these other courts was persuasive. Thus, the Court of Appeals was correct in stating that the verdict sheet itself is a tool for the jury to utilize in deciding its verdict, but does not constitute the verdict.

Likewise, the verdict sheet did not evidence any confusion by the jury as to the charges. The instructions directed the jury to “consider” the second degree offense if the jurors found the defendant not guilty of the corresponding first degree offense, but the instructions did not specifically direct the jurors to skip the question entirely if they found the defendant guilty of the greater offense. The jury’s marking of “not guilty” for the second degree charges, for which the jury found Ogundipe guilty of the corresponding first degree charges, emphasized the jury’s intent to convict Ogundipe of the greater offenses.

Nonetheless, the courtroom clerk acted properly and in accordance with the judge’s instructions by skipping Questions 2, 4, 8, and 10, relating to those corresponding lesser included offenses, and by reading aloud only that the jury found Ogundipe guilty of the greater offenses. Finally, had the jurors intended a different result, they could have made their objections known during the polling or hearkening.

Accordingly, the judgment of the Court of Special Appeals, in holding that the circuit court did not err in failing to disclose the contents of the verdict sheet to defense counsel because the verdict sheet was not a verdict in itself, was affirmed.

COMMENTARY: In the alternative, Ogundipe argued that the verdict sheet was a communication within the purview of Maryland Rule 4-326(d) that should have been disclosed.

Pursuant to Rule 4-326(d), a court must disclose any communication from the jury pertaining to the action. Any failure of the trial court to disclose a communication under Rule 4-326(d) will not be considered harmless error unless the record affirmatively shows that such communications were not prejudicial or had no tendency to influence the verdict of the jury. Denicolis v. State, 378 Md. 646 (2003). The purpose of this Rule is to provide an opportunity for input in designing an appropriate response to each question in order to assure fairness and avoid error. Perez, 420 Md. at 64.

Ogundipe argued he was denied the right to be present at every stage of the trial; specifically, he claimed that he was not “present” for the verdict because he did not have knowledge of the contents of the verdict sheet, which comprised a “large portion of the verdict.” However, the plain language of Rule 4-326(d) indicates that the verdict sheet is not the type of communication contemplated by the Rule.

As stated, the purpose of Rule 4-326(d) is to ensure that the parties have an opportunity to provide input before the court responds to a communication. Unlike communications received by the court during the presentation of evidence or during deliberation, a verdict sheet does not require input from counsel or from the court.

Accordingly, the Court of Special Appeals was correct in concluding that the verdict sheet is merely a tool for the jury to use in order to aid in its deliberation, rather than a communication requiring action by the court or by counsel. Thus, the verdict sheet is not a communication requiring disclosure under Rule 4-326(d).

PRACTICE TIPS: A criminal defendant’s right to be present at every stage of the proceedings against him does not expire at the conclusion of the jury’s deliberations. Rather, this right persists until the jury has been discharged, after the reading of the verdict in open court, the polling of the jury and the hearkening of the verdict. This right to be present is absolute, and a judgment of conviction ordinarily cannot be upheld if the record discloses a violation of the right.

Estates and Trusts

Accounting

BOTTOM LINE: An order for accounting is not a final appealable judgment or an appealable interlocutory order; therefore, the circuit court’s order requiring the trustor of an inter vivos trust to provide an accounting was dismissed.

CASE: Moreland Johnson v. Johnson, No. 63, Sept. Term, 2009 (filed Dec. 14, 2011) (Judges Bell, Battaglia, Greene, Murphy, Adkins, Barbera & Eldridge (Retired, Specially Assigned)). RecordFax No. 11-1214-20, 9 pages.

FACTS: The controversy in this case was between the trustee of an inter vivos trust, Catherine Moreland Johnson, and her stepson, James Johnson, who was a beneficiary of the trust.

The Johnson Family Trust was created on August 25, 2004, by Edward Johnson and his wife, Catherine Moreland Johnson, who were named as trustors and co-trustees. They established the trust, according to its express language, with the intent that, while they were both living, they would each equitably own an undivided one-half interest in all property subject to the trust. This was to be accomplished by the use of the federal gift tax exemption for transfers between husband and wife. The trust property, which was listed in an attached “Schedule A,” constituted the trust estate. Due to its gifting provisions, the beneficial interest of the first trustor to die was to be exactly equal to that of the surviving trustor.

On February 14, 2006, Edward was the first to die. Pursuant to the trust instrument, the trust estate was then to be divided into two shares. Trust A was to be created to take advantage of the federal estate tax exclusion and other tax provisions. The remaining portion of the decedent’s interest was to be distributed to an irrevocable Trust B.

The surviving trustor, Catherine, was entitled to the income and potentially all of the principal of Trust A during her lifetime, if needed for her health, maintenance, reasonable comfort and support. She had a power of appointment to dispose of the undistributed income and principal of Trust A by her Last Will and Testament, and if that power was not exercised, upon her death, the Trust A corpus was to be added to Trust B and distributed according to its terms.

Catherine had the same lifetime entitlement to the income and to principal of Trust B if needed for her health, maintenance, or support. She had a limited power of appointment over the Trust B estate which authorized her to leave it to one or more of any children and/or other descendants of both Trustors in such shares as she may deem appropriate. If Catherine did not exercise this limited power, distribution of the Trust B corpus would be governed by the Trust’s Article VI, which expressly named Edward’s son, James, as a beneficiary, if he survived Catherine.

After Edward’s death, James twice asked Catherine for an accounting of the trust, but Catherine did not answer his requests. James filed in circuit court a petition requesting that the court assume jurisdiction over the trust and require that Catherine file an accounting. The circuit court granted the petition and ordered that Catherine provide an accounting of the trust. Catherine appealed the circuit court’s order to the Court of Special Appeals, which affirmed the circuit court’s order.

Catherine appealed to the Court of Appeals, which held that an order for accounting was not a final appealable judgment or an appealable interlocutory order, and vacated the judgment of the Court of Special Appeals and remanded the case.

LAW: On appeal, Catherine raised issues concerning the status of James; specifically, Catherine presented the issues of whether James had a right to an accounting, and whether the circuit court’s order contravened the terms of the trust. Neither the parties nor the lower courts raised any issue concerning the appealability of the circuit court’s order. Nevertheless, an order of a circuit court must be appealable in order to confer jurisdiction upon an appellate court, and this jurisdictional issue, if noticed by an appellate court, will be addressed sua sponte. See, e.g., Stachowski v. State, 416 Md. 276, 285 (2010).

When Catherine’s counsel was asked at oral argument whether the circuit court’s order was appealable, he responded by stating that the order was appealable as a final judgment. See Maryland Code (1974, 2006 Repl.Vol.), §12-301 of the Courts and Judicial Proceedings Article. However, it has been settled in Maryland for almost 200 years that an order for an accounting or similar referral is not appealable as a final judgment because, by the order, nothing is finally settled between the parties, and the order for an accounting is only preparatory to a final decree. Snowden et al. v. Dorsey et al., 6 H. & J. 114, 116 (1823).

The provision now codified as §12-303(3)(vi) was first enacted as Ch. 367 of the Acts of 1845, passed by the General Assembly on March 10, 1846. Except for the difference in the names of trial courts, the language of the provision has remained virtually unchanged since 1846. Indeed, the requirement that, to be appealable, the order for an accounting must decide a question of right between the parties was applied by Maryland courts even before Ch. 367 was enacted. See, e.g., Clagett v. Crawford, 12 G. & J. 275, 285 (1841).

As the trial court’s order in this case did not decide any issue concerning the parties’ rights, the order was not appealable. Accordingly, the judgment of the Court of Special Appeals was vacated and the case remanded to the Court of Special Appeals with directions to dismiss the appeal.

COMMENTARY: The only statute authorizing interlocutory appeals from orders directing an accounting is §12-303(3)(vi) of the Courts and Judicial Proceedings Article. Section 12-303(3)(vi) authorizes an appeal from an interlocutory order entered by a circuit court determining a question of right between the parties and directing an account to be stated on the principle of such determination. Subsequent cases under Ch. 367 and successor statutes have reaffirmed that an interlocutory order directing an accounting is not appealable unless the order also decides “a question of right” between the parties. See, e.g., Goodburn v. Stevens, 1 Md. Ch. 420, 427 (1849).

Thus, in this case, in order for the circuit court’s order to be appealable, it would have to be appealable under §303(3)(vi). However, the order in this case did not determine a question of right between the parties. As such, the circuit court’s order was clearly not within the purview of §12-303(3)(vi).

PRACTICE TIPS: Under the Courts and Judicial Proceedings Article, a party generally may appeal from a final judgment entered in a civil or criminal case by a circuit court. In a criminal case, the defendant may appeal even though imposition or execution of sentence has been suspended. In a civil case, a plaintiff who has accepted a remittitur may cross-appeal from the final judgment.

Professional Responsibility

Disbarment

BOTTOM LINE: For the protection of the public, disbarment was appropriate sanction for attorney who engaged in ongoing and intentional dishonest conduct, including knowingly and willfully attempting to induce real estate agent and her client to enter a contract of sale through provision of fraudulent documents and bad checks, misappropriation of client funds, development of multiple schemes to defraud and steal from others.

CASE: Attorney Grievance Commission of Maryland v. Seltzer, Misc. Docket AG No. 55, Sept. Term, 2010 (filed Dec. 22, 2011) (Judges Bell, Harrell, BATTAGLIA, Greene, Adkins, Barbera & Eldridge (Retired, Specially Assigned)). RecordFax No. 11-1222-21, 26 pages.

FACTS: Aaron Seltzer was admitted to the Maryland Bar in 2001. On December 9, 2010, the Attorney Grievance Commission filed a Petition for Disciplinary or Remedial Action against Seltzer, which incorporated two complaints, one by real estate agent Debbie Jenkins, and the other by June Carolyn Piper-Brandon, a partner of Seltzer’s realty company, Advance Realty Anne Arundel Inc.

With respect to the Jenkins complaint, Bar Counsel alleged that Seltzer violated various Maryland Rules of Professional Conduct, including Rule 8.4(a)-(d) (Misconduct), for engaging in deceitful acts and misrepresentations in connection with Seltzer’s attempted purchase of commercial real estate in Baltimore, Maryland, as well as Rule 8.1(b) (Bar Admission and Disciplinary Matters) for failing to cooperate with Bar Counsel in the course of its investigation of the complaints, failing to appear for a Statement Under Oath for which he was duly subpoenaed, and failing to provide Bar Counsel with documents requested by subpoena. With respect to the Piper-Brandon complaint, Bar Counsel alleged that Seltzer again violated Rule 8.4(a), (b), (c) and (d) for converting funds in his realty company’s operating account for his own use and misappropriating funds in his realty company’s escrow account and Rule 8.1(b) for failing to respond to a request for information by Bar Counsel.

In an order dated December 10, 2010, the matter was referred to circuit court Judge Paul Bowman for hearing, pursuant to Rule 16-757.

Seltzer was served with the Petition for Disciplinary or Remedial Action, as well as the Order, Writ of Summons, Interrogatories, Request for Production of Documents, and Request for Admission of Facts and Genuineness of Documents. Seltzer did not file an answer or any other response. An order of default was entered, notice of which was sent to Seltzer. No motion to vacate was filed. The case proceeded on the Requests for Admissions of Facts and Documents, which were deemed admitted by Judge Bowman because Seltzer failed to respond.

In his Findings of Fact and Conclusions of Law memorandum, Judge Bowman found that beginning in 2008, Seltzer was simultaneously a partner of four different companies, Village Green, Death Star, Advance Realty, and First Class. In 2008, Seltzer submitted a contract to purchase real property on behalf of a fifth company, Allied Baltimore Development Group, LLC, to Debbie Jenkins, an agent for the seller of several commercial properties in Baltimore. One of the contract provisions was that Allied’s deposit would be held by Village Green.

At no time, however, did Seltzer explain, nor did Jenkins or her seller understand, that Seltzer executed the contract on behalf of Allied or that he was affiliated with Village Green, or any of the other companies, Death Star, Advance Realty or First Class. Pursuant to the contract of sale, Seltzer was to provide Village Green with a check representing a deposit which was drawn on Death Star’s bank account. The check was returned for insufficient funds.

After Seltzer repeatedly assured Jenkins that he would pay the deposit but failed to do so, the sale did not go through. Seltzer subsequently issued fraudulent documents to the real estate agent’s clients to sell commercial properties.

Seltzer received and failed to respond to two letters and four subpoenas from Bar Counsel requesting that he produce documents related to the Jenkins complaint.

Judge Bowman concluded that Seltzer’s failure to disclose his role as managing member of First Class during negotiations for the second contract, paired with the bad Death Star checks, subsequent fraudulent documents, and multiple failures to respond to Bar Counsel’s requests for information, established, by clear and convincing evidence, that Seltzer had engaged in a pattern of deceit that violated Rules 8.4(a), (b), (c) and (d) and 8.1(b). Judge Bowman further stated that Seltzer’s continuing course of deceit and misrepresentations with Jenkins over a nine-month period violated Rule 8.4(a), (b) and (c) and was prejudicial to the administration of justice in violation of 8.4(d).

With regard to the Piper-Brandon complaint, Judge Bowman found that Seltzer, co-owner of Piper-Brandon’s Advanced Realty Anne Arundel, Inc., used his signatory authority to withdraw from Advanced Realty’s operating account at least $2,300 to which he was not entitled, and to transfer, without authorization, $5,500 from Advanced Realty’s escrow account.

Judge Bowman found, by clear and convincing evidence, that Seltzer’s conduct, specifically the misappropriation of funds to which he was entrusted, established that he had violated Rules 8.4(a), (b), (c) and (d) and his failure to respond to the Piper-Brandon complaint, established that he had violated Rule 8.1(b).

Neither Seltzer nor Bar Counsel filed any exception to the Findings of Fact and Conclusions of Law, and Bar Counsel recommended the sanction of disbarment. Seltzer failed to appear at oral argument before the Court of Appeals.

After oral argument, the Court of Appeals entered a per curiam order disbarring Seltzer.

LAW: The findings of fact sufficiently established that Seltzer violated Rules 8.4(a), (b), (c) and (d) when he continually misrepresented and deceived Jenkins, submitted fraudulent documents, and issued bad checks. Moreover, with respect to Rule 8.4(b), which prohibits a lawyer from committing a criminal act that reflects adversely on the lawyer’s honesty, trustworthiness or fitness as a lawyer, Seltzer’s multiple fraudulent documents submitted to real estate agent Jenkins, all in an effort to induce the agent’s client to join in a contract of sale, constituted criminal acts. See Section 7-104(b) of the Criminal Law Article.

The facts also established that Seltzer knowingly attempted, through bad checks and fraudulent documents, to defraud Ms. Jenkins and her client and induce them to enter a contract of sale.

When an attorney intentionally submits fraudulent documents to obtain pecuniary gain, Rule 8.4(c) also is violated. That Seltzer engaged in deceitful conduct outside of the practice of law did not immunize the sanctionable nature of his behavior. See, e.g., Attorney Grievance v. Jordan, 386 Md. 583, 594 (2005).

As to Rule 8.4(d), Seltzer’s pattern of deceitful conduct with Jenkins was certainly prejudicial to the administration of justice because it was conduct that impacts on the image or the perception of the legal profession. Attorney Grievance v. Marcalus, 414 Md. 501, 522.

As to Rule 8.4(a), which provides that it is misconduct to violate or attempt to violate the Lawyers’ Rules of Professional Conduct, it is well established that various rule violations, of themselves, are sufficient to support a violation. Attorney Grievance v. Webster, 402 Md. 448, 468 (2007). Seltzer’s violations of Rules 8.4(b), (c) and (d) clearly supported a violation of Rule 8.4(a). And, with regard to Seltzer’s conduct during Bar Counsel’s investigation of the. Jenkins complaint, Seltzer violated Rule 8.1(b), which prohibits a lawyer, in connection with a disciplinary matter, from knowingly failing to respond to a lawful demand for information from a disciplinary authority. Seltzer’s failure to respond to Bar Counsel’s requests for information were sufficient for the hearing judge to conclude that Seltzer violated Rule 8.1(b). Attorney Grievance v. Bleecker, 414 Md. 147 (2010).

The court’s primary goal in disciplining an attorney is to protect the public. Bleecker, 414 Md. at 176. To effectuate that goal, the court may consider a number of factors, including prior disciplinary offenses, dishonest or selfish motive, a pattern of misconduct, and multiple offenses. Id. at 176-77, 994 A.2d at 945-46. Here, Seltzer’s dishonest and selfish motives were apparent throughout his misconduct with regard to Jenkins and Advanced Realty. He knowingly and willfully attempted to induce Jenkins and her client to enter a contract of sale through his provision of fraudulent documents and bad checks, and misappropriation of funds in the operating and escrow accounts of Advanced Realty, including funds which belonged to his clients.

Seltzer’s conduct was egregious and violated multiple rules. Bleecker, 414 Md. at 178. Seltzer developed multiple schemes to defraud and steal from others. In his real estate transactions, Seltzer misrepresented to the seller his dual roles in Allied and Village Green, issued bad checks, and provided fraudulent documents as to his financial stature, all in an effort to induce the seller to enter a contract of sale that Seltzer did not intend to honor. He made multiple withdrawals of funds to which he was not entitled.

Intentional dishonest conduct is closely entwined with the most important matters of basic character to such a degree as to make intentional dishonest conduct by a lawyer almost beyond excuse. Attorney Grievance v. Vanderlinde, 364 Md. 376, 418 (2001). Thus, Seltzer’s fraud and misappropriation of client funds by lawyers for their own pecuniary gain, paired with repeated avoidance of Bar Counsel during investigation, warranted a grave sanction. Seltzer’s utter lack of truthfulness, creation of fraudulent documents and misappropriation of funds demonstrated that he was unfit to practice law.

Accordingly, the Court of Appeals entered an order for Seltzer’s disbarment.

COMMENTARY: With respect to the charges raised in the Piper-Brandon complaint, Seltzer’s conversion and misappropriation of funds from Advanced Realty’s operating and escrow accounts likewise violated Rules 8.4(a), (b), (c) and (d), and Seltzer’s subsequent failure to respond to Bar Counsel’s request for information violated Rule 8.1(b). Seltzer clearly engaged in dishonesty when he removed, for personal use, funds to which he was entrusted and to which he was not entitled. These multiple rule violations warranted the sanction of disbarment.