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Law Digest — Md. Court of Appeals, Court of Special Appeals –Sept. 23, 2021

Maryland Court of Appeals

Consumer Law; Statute of limitations: Maryland’s general three-year statute of limitations under Courts & Judicial Proceedings §5-101 applies to claims filed by a judgment debtor against a judgment creditor for unjust enrichment and money damages under the Maryland Consumer Protection Act and the Maryland Consumer Debt Collection Act related to collection activities arising from the entry of a judgment at a time when the judgment creditor was not a licensed collection agency, and the continuing harm doctrine did not apply to extend the accrual period for claims for unjust enrichment and statutory money damages related to a judgment creditor’s collection activities, where the wrongful conduct forming the basis of the plaintiffs’ claims was the debt collector’s licensure status at the time the judgment was entered and where the collection activities occurred after the debt collector obtained its license. Cain v. Midland Funding, LLC, Nos. 38 and 39, Sept. Term, 2020.

Maryland Court of Special Appeals

Family Law; Child in Need of Assistance: Pursuant to Courts and Judicial Proceedings §3-817(b), when there is a contested adjudicatory hearing regarding a petition to have a child declared a Child in Need of Assistance (“CINA”), the department of social services is required to submit evidence, in compliance with the Maryland Rules, to support the allegations in the CINA petition; therefore, where the circuit court’s factual findings in a contested adjudicatory hearing were not based on evidence but based solely on an unadmitted emergency shelter care report and proffers by the parties, these factual findings were clearly erroneous. In re M.H., No. 1267, Sept. Term, 2020.

Family Law; Visitation: Under Maryland Code, Family Law Article §9-105, which states that a circuit court may grant a parent who has wrongfully been denied visitation “makeup” visitation in a manner consistent with the best interest of the child, the circuit court did not abuse its discretion in denying makeup visitation time to a father who had unjustifiably been denied visitation access where the court found that such a denial was in the best interests of the child. Alexander v. Alexander, No. 1320, Sept. Term, 2020.

Workers’ Compensation; Offset: Under Labor and Employment Article §9-610(a)(l), where an employee’s service-connected total disability retirement compensated for any and all work-related injuries he sustained in his employment with the county, he could not also receive a permanent partial workers’ compensation award. Spevak v. Montgomery County, Maryland, No. 893, Sept. Term, 2019.

Maryland Court of Appeals

Consumer Law

Statute of limitations

BOTTOM LINE: Maryland’s general three-year statute of limitations under Courts & Judicial Proceedings §5-101 applies to claims filed by a judgment debtor against a judgment creditor for unjust enrichment and money damages under the Maryland Consumer Protection Act and the Maryland Consumer Debt Collection Act related to collection activities arising from the entry of a judgment at a time when the judgment creditor was not a licensed collection agency, and the continuing harm doctrine did not apply to extend the accrual period for claims for unjust enrichment and statutory money damages related to a judgment creditor’s collection activities, where the wrongful conduct forming the basis of the plaintiffs’ claims was the debt collector’s licensure status at the time the judgment was entered and where the collection activities occurred after the debt collector obtained its license.

CASE: Cain v. Midland Funding, LLC, Nos. 38 and 39, Sept. Term, 2020 (filed August 4, 2021) (Judges Barbera, McDonald, Watts, Hotten, Getty, BOOTH  & Biran).

FACTS: On September 10, 2009, a federal civil action was filed against Midland Funding, LLC, in Johnson v. Midland Funding, LLC, D. Md. Civil. No. 09-2391. Clifford Cain, Jr., was a putative class member of the Johnson plaintiffs’ proposed class, which was defined as “all natural persons who reside in Maryland and who have been the subject of consumer debt collection efforts by Midland within three years immediately preceding the filing of this class action that included the filing of an action before a Court of the State of Maryland.” In June 2010, the parties agreed to a settlement of the Johnson case. As part of the settlement, the plaintiff class was narrowed to exclude persons – like Cain – against whom Midland had obtained a judgment. The federal district court approved the settlement on March 10, 2011. The claims that were not included in the settlement were dismissed with prejudice.

On July 30, 2003, Cain filed a putative class action against Midland in the circuit court. In a separate case, on September 28, 2015, Tasha Gambrell filed a putative class action against Midland in a different circuit court. In both cases, the plaintiffs alleged Midland obtained judgments against the named plaintiffs and similarly situated members of the putative classes for consumer debts during a time period when Midland did not have a collection agency license under the Maryland Collection Agency Licensing Act (“MCALA”).

Both putative class actions included counts for declaratory judgment, injunctive relief preventing Midland from collecting on the judgments in the future, and money damages arising from claims for unjust enrichment and violations of the Maryland Consumer Debt Collection Act (“MCDCA”) and the Maryland Consumer Protection Act (“MCPA”). In both cases, the circuit courts resolved the cases by motion. In Cain’s case, the circuit court entered an order granting summary judgment to each party in part, and a separate declaratory judgment declaring the rights of the parties. In Gambrell’s case, the circuit court granted Midland’s motion to dismiss.

Both cases were appealed to the Court of Special Appeals. With respect to Cain’s case, the Court of Special Appeals determined that it had jurisdiction to consider Cain’s appeal, concluding that the circuit court’s summary judgment order and declaratory judgment constituted a final judgment. Aside from that procedural issue, which was unique to Cain’s case, the Court of Special Appeals resolved Cain’s and Gambrell’s claims in the same manner. In both cases, the intermediate appellate court held that the decision in LVNV Funding LLC v. Finch, 463 Md. 586 (2019) (“Finch III”) resolved the plaintiffs’ declaratory judgment counts and that under Finch III, the judgments obtained when Midland was unlicensed were not void. The court also held that, since the plaintiffs’ judgments had been satisfied, they were not entitled to injunctive relief because Midland was no longer collecting on them. With respect to the remaining claims seeking restitution under an unjust enrichment theory and money damages for the statutory claims, the Court of Special Appeals held that the claims were barred by the general three-year statute of limitations codified at Maryland Code, Courts and Judicial Proceedings Article (“CJ”) §5-101.

The plaintiffs appealed to the Court of Appeals. In Cain’s case, the decision of the Court of Special Appeals was affirmed in part and reversed in part. In Grambrell’s case, the decision of the Court of Special Appeals was affirmed in its entirety.

LAW: At issue on appeal was whether the plaintiffs’ claims for unjust enrichment and for statutory damages under the MCDCA and the MCPA were time-barred. Cain’s claims for money damages accrued for limitations purposes when Midland received its first payment on the judgment, which was on September 25, 2009. Cain filed suit on July 30, 2013 – more than three years after the claim accrued. Gambrell’s claims accrued on July 14, 2008, the date that Midland filed its collection action against her. Midland’s unlicensed status was a matter of public record, and the Licensing Board had issued an advisory notice requiring collection agents to be licensed two years prior to the commencement of that action. Gambrell filed her lawsuit on September 28, 2015, almost seven years after the district court entered judgment against her on October 8, 2008, and nearly six years after Gambrell made a partial payment to Midland on November 30, 2009.

As the Court of Special Appeals correctly held, both plaintiffs’ claims accrued at the latest when Midland received its first payments on the judgments. By making the payments, they were clearly on notice of the judgment that had been entered against them, and they had the ability to determine whether Midland was licensed at the time of the entry of the judgments. Given that plaintiffs’ claims were filed more than three years after their respective accrual, they were barred by the three-year statute of limitations unless: (1) an alternative limitations period applies; (2) it was extended under a continuing harm theory; or (3) it was tolled.

The default statute of limitations for civil actions at law in Maryland, codified at CJ §5-101, is three years, unless another provision of the Code expressly provides for an alternative limitations period. See, e.g., AGV Sports Grp., Inc. v. Protus IP Sols., Inc., 417 Md. 386, 392 (2010). As noted, the plaintiffs’ claims were for unjust enrichment and money damages for violations of the MCPA and MCDCA. Notwithstanding the application of the three-year statute of limitations to similar claims for money damages, the plaintiffs asserted that their claims fell within the 12-year statute of limitations applicable to specialties actions because, they argued, their claims constituted an “action on a judgment” under CJ §5-102(a)(3).

Considering first the plain language of the specialties statute, a 12-year statute of limitations applies to a specialties “action on judgment.” CJ §5-102(a)(3). The wording of the statute indicates that it applies to “an action on one of the following specialties,” which includes an action to enforce a promissory note or other instrument under seal, a judgment, a contract under seal, etc. Given the nature of the specific list of specialties identified, the statue is clearly intended to apply to an action to enforce rights granted by a specialty. See, e.g., Goodwin & Boone v. Choice Hotels Int’l, Inc., 346 Md. 153 (1997).

This interpretation of the statute as providing a 12-year statute of limitations on a specialties action to enforce a judgment was also confirmed by its legislative history. The present statute, CJ § 5-103, is a recodification of former Md. Code (1957), Article 57, §3. The language in the original specialties statute clearly contemplated a 12-year statute of limitations for actions on a judgment brought against a judgment debtor. Nothing in the prior version of the statute could be construed to establish a 12-year statute of limitations for a judgment debtor to assert a claim against a judgment creditor for a matter arising out of the entry of a judgment.

The interpretation of the plain language of CJ §5-102(a)(3) as establishing a 12-year statute of limitations only to enforce a judgment and not establishing the same period to challenge a judgment is consistent with principles of finality expressed by the Supreme Court and by the Court of Appeals for over a century. See Milwaukee County v. M.E. White Co., 296 U.S. 268, 275 (1935); see also Finch III. To interpret the specialties statute as providing a 12-year statute of limitation for a debtor to challenge a judgment, or activities related to the entry of the judgment, would run contrary to the very principles expressed in Finch III concerning the finality of judgments. By contrast, the competing construction – that the General Assembly would establish a longer limitations period only to enforce a judgment – is consistent with the general purpose of collection laws, which enable judgments to be paid over a longer time period thereby ensuring that payment is not unduly burdensome to a judgment debtor.

Finally, the plaintiffs’ interpretation would also create illogical results. In other contexts, Maryland courts have rejected arguments that statutory claims for money damages fall within other categories of the 12-year specialties statute instead of the three-year default statute. See Greene Tree Home Owners Ass’n v. Greene Tree Assocs., 358 Md. 453 (2000). It would be illogical to apply a strained interpretation to the specialties statute and hold that a 12-year limitations period applies to claims under the MCPA for unlicensed collection activities that result in the entry of a judgment, but apply only a three-year limitations period to claims for similar conduct that by happenstance, does not result in the entry of a judgment.

In summary, the 12-year statute of limitations under CJ § 5-102(a)(3) is intended to apply to an action to enforce a judgment. Because the plaintiffs were not seeking to enforce a judgment, but rather, were seeking money damages resulting from Midland’s efforts to collect the judgment, CJ §5-102(a)(3) did not apply. Such claims were subject to the default three-year statute of limitations under CJ §5-101.

To avoid the three-year limitations bar to their claims, the plaintiffs additionally contended that the continuing harm doctrine applied to change the accrual date for their claims since they made multiple payments to Midland over a period of time. The continuing harm doctrine permits recovery by an injured party caused by a tortfeasor’s sequential breaches of an ongoing duty by imposing a new limitations period for each breach. Litz v. Maryland Department of the Environment, 434 Md. 623, 649 (2013). Here, however, the wrongful conduct that formed the basis of the plaintiffs’ claims was Midland’s unlicensed status when it filed the collection actions and obtained the judgments against the plaintiffs. Although Midland was unlicensed at the time that it obtained judgments against Cain and Gambrell, Midland subsequently entered into a settlement agreement with the Licensing Board on December 17, 2009, whereby Midland agreed to stay all collection-related actions until it was issued a license.

The Licensing Board issued Midland a collection agency license on January 15, 2010. The collection activities upon which the plaintiffs sought to extend their accrual date for limitations purposes occurred after Midland became licensed. It would be inappropriate to apply the continuing harm doctrine where the alleged continuing harm was Midland’s attempts to collect on the judgments after it became licensed. See Finch III, 463 Md. at 606.

Applying the class action tolling rule set forth in American Pipe & Construction Co. v. Utah, 414 U.S.538 (1974), to Cain’s individual claims, the claims were timely filed. Accordingly, in Cain’s case, the decision of the Court of Special Appeals was affirmed in part and reversed in part. In Grambrell’s case, the decision of the Court of Special Appeals was affirmed in its entirety.

COMMENTARY: Cain argued that the class action tolling rule outlined in American Pipe & Construction Co. v. Utah, 414 U.S.538 (1974), applied to toll the applicable statute of limitations on his claims filed in the present case for a time period equal in duration to the pendency of the prior federal class action case wherein he was a putative class member. In American Pipe, the United States Supreme Court held that the commencement of a class action suspends the applicable statute of limitations as to all asserted members of the class who would have been parties had lawsuit been allowed to continue as a class action. tolling. Maryland adopted the concept of “class action tolling” in Philip Morris USA, Inc. v. Christensen, 394 Md. 227, 238 (2006), abrogated on other grounds, Mummert v.Alizadeh, 435 Md. 207 (2013).

To permit tolling based upon successive class action suits could result in a “rolling tolling” approach to class action suits, whereby a putative class member could toll his or her statute of limitations after the denial of one class action certification in one circuit court by filing a successive class action in one of the other 23 state circuit courts. As such, American Pipe class action tolling does not apply to permit a putative class member, upon denial of class certification, to file a successive class action past the expiration of the statute of limitations.

Applying these principles to Cain’s individual claims, the three-year statute of limitations was tolled from the filing of the Johnson case on September 10, 2009 until March 10, 2011 – the date that the federal district court approved the settlement of the limited class and entered an order dismissing the claims that were not part of the settlement. Cain’s individual claims were tolled during the pendency of the Johnson action, or for 546 days. The circuit court determined that Cain’s claim started to accrue when Midland received its first payment on the judgment on September 25, 2009. Cain filed the present action 1,404 days later – on July 30, 2013 – which was beyond the three-year statute of limitations. However, tolling the three-year statute during the pendency of the Johnson action for a period of 546 days, Cain’s individual claims were not barred by the three-year limitations period (1,404 days – 546 days = 858 days). Applying cross-jurisdictional tolling to Cain’s individual claims, the claims were timely filed.

  

PRACTICE TIPS: In Maryland, courts apply the “discovery rule” in civil actions in determining when the statute of limitations begins to accrue on a claim. Under this rule, a claim accrues when the plaintiff “knew or reasonably should have known of the wrong.”

Maryland Court of Special Appeals

Family Law

Child in Need of Assistance

BOTTOM LINE: Pursuant to Courts and Judicial Proceedings §3-817(b), when there is a contested adjudicatory hearing regarding a petition to have a child declared a Child in Need of Assistance (“CINA”), the department of social services is required to submit evidence, in compliance with the Maryland Rules, to support the allegations in the CINA petition; therefore, where the circuit court’s factual findings in a contested adjudicatory hearing were not based on evidence but based solely on an unadmitted emergency shelter care report and proffers by the parties, these factual findings were clearly erroneous.

CASE: In re M.H., No. 1267, Sept. Term, 2020 (filed July 29, 2021) (Judges Kehoe, Friedman & RIPKEN).

FACTS: On June 5, 2020, E.D.C., the mother of minor male child M.H., made a statement to police that M.H.’s father had burned two-year-old M.H. with a cigarette and that both parents were using methamphetamines in M.H.’s presence. As a result of the mother’s statement, the Elkton Police Department obtained and executed a search warrant on the family residence. The police requested a case worker with the Department of Social Services for Cecil County be present at the home to ensure M.H.’s welfare.

Brittany Lester, a social worker for the Department, subsequently arrived at the residence. At that point, M.H.’s father had been arrested and taken into custody and was no longer at the residence. Lester observed that the home was “in disarray” and “posed many safety hazards” within reach of the toddler. There were snap rat traps on the floors and tables throughout the home. A large hunting knife was in an open drawer. Numerous pill and alcohol bottles, food waste, and trash were scattered across the floor of the home and in the bedroom where M.H. and his parents slept. Propped up against the wall in the bedroom was an inflatable mattress, which was laid down on top of the debris at night for the family to sleep.

Lester transported M.H. to the Elkton police station, where she met with his mother and father. M.H. was placed in shelter care through the Department the same night, and the Department filed an Emergency Shelter Care Report with the circuit court on June 10, 2020. In the report, Lester articulated several reasons that M.H. should remain in shelter care rather than return to his parents’ physical custody. These allegations included drug use in the presence of 2-year-old M.H., domestic violence in the home, the parents’ inability or unwillingness to protect M.H. from present dangers, and that there was no substitute caretaker to ensure M.H.’s safety. According to the report, M.H.’s mother had stated that she had an active protective order in place against the father, which gave her full custody of M.H. Despite the protective order, the mother permitted M.H.’s father to stay in the family residence.

On June 10, 2020, the Department filed a petition alleging that M.H. was a Child in Need of Assistance (“CINA”). The petition identified the mother and father as M.H.’s natural parents, provided the parents’ addresses, and indicated that M.H. had been taken from his parents’ custody before entering shelter care. In addition to the CINA petition, the Department filed a Petition for Continued Shelter Care. Following a hearing on June 23, 2020, the circuit court granted continued shelter care of M.H. pending the adjudicatory hearing on the CINA petition. The court appointed M.H. an attorney to advocate for his best interests.

The circuit court held an adjudicatory hearing on October 6, 2020. At the beginning of the hearing, the Department advised the court that M.H.’s mother had passed away since the last hearing due to an apparent overdose. M.H.’s father made an oral motion to dismiss. The focal point of the hearing was M.H.’s placement in foster care rather than placement with relatives. The parties agreed that the adjudicatory hearing should be reconvened in two weeks to provide the relatives with sufficient time to undergo the screening process. The court did not explicitly rule on the father’s motion to dismiss.

On October 20, 2020, the court reconvened the adjudicatory hearing. Following the hearing, the circuit court found that M.H. was a Child in Need of Assistance. The court further ordered M.H.’s father to participate in drug and alcohol, psychological, parenting, and domestic violence evaluations.

M.H.’s father appealed to the Court of Special Appeals, which vacated the judgment of the circuit court and remanded the case.

LAW: M.H.’s father first contended that the circuit court erred in failing to grant his motion to dismiss the CINA petition for failure to comply with Courts & Judicial Proceedings (“CJP”) §3-811 (2013 Repl. Vol.). He argued that the petition did not meet the requirement that a CINA petition “allege that a child is in need of assistance and shall set forth in clear and simple language the facts supporting that allegation” and that the petition failed to meet due process standards of notice as to the nature of the proceedings. He also argued that the circuit court’s findings of fact were clearly erroneous.

Specifically, M.H.’s father claimed that the CINA petition, which simply incorporated by reference the Emergency Shelter Care Report, was insufficient to meet the requirement of “clear and simple language.” In support of this assertion, he argued that the Report was full of conclusory statements without support. For instance, the Report alleged that M.H.’s parents’ drug and alcohol use placed two-year-old M.H. in immediate danger, but, M.H.’s father argued, the facts to support this conclusion were not presented. In addition, the Report failed to clearly distinguish between statements collected from M.H.’s mother at the police station and the social worker’s observations and impressions.

M.H.’s father was correct that the CINA petition had certain deficiencies, such as the failure to contain a witness list as well as the failure to follow the format prescribed by CJP §3-811 and Md. Rule 11-103. However, the petition identified M.H.’s natural parents, provided the parents’ addresses, and referenced the Emergency Shelter Care Report, which included details about the cigarette burn, the unkempt condition of the home and the hazards throughout it, and the parents’ consistent drug use in the presence of M.H. The Report also indicated that M.H. had been taken from his parents’ custody before entering shelter care, and identified Lester as the author. Although no witness list was provided, the Report included the names of all potential witnesses and no witnesses were called during the hearings.

With this information, M.H.’s father had minimally sufficient details to prepare for the CINA proceedings. The Department’s incorporation of the emergency shelter care report to satisfy the requirement of “clear and simple language” upon which the allegations were based is not the best practice for drafting a CINA petition. Nevertheless, the petition was minimally sufficient to inform M.H.’s father of the “who, what, when, and where” regarding the allegations in the petition sufficient to prepare for his defense. As such, the circuit court did not err in denying M.H.’s father’s motion to dismiss prior to adjudication.

M.H.’s father went on to contend that the Emergency Shelter Care Report was inadmissible hearsay and that, therefore, the court’s findings of fact at adjudication, which were solely based on the Report, were clearly erroneous. M.H’s father also argued that the court’s sustained factual findings in the order were clearly erroneous because the Report was not admitted into evidence. Finally, he asserted that there were facts in the court’s order that were not included in the Report, further supporting a clearly erroneous holding.

Pursuant to CJP §3-817(c), the Department was required to prove, by a preponderance of the evidence, that the allegations in the CINA petition were true. Md. Rule 11-114 (c), (e)(3). The circuit court’s finding that the Department proved these allegations by a preponderance of the evidence and the specific findings in the Order are clearly erroneous because they are not supported by competent evidence. During the contested adjudicatory hearing, no evidence was presented and no witnesses were called during the contested adjudicatory hearing. While Lester might have been available to testify regarding the conditions of the home when M.H. was removed, no such testimony was ever provided. The Report, which was the substance of the allegations in the CINA petition, was also not admitted into evidence. In short, the Department did not offer, and the court did not admit, any evidence to support the allegations in the petition.

The practice of “submitting on the report” in a contested adjudication is flatly contrary to the CINA statute. As noted. CJP §3-817(b) states that the rules of evidence apply at adjudicatory hearings and the Department has the burden of proving the allegations in a petition by a preponderance of the evidence. This section requires the Department to submit evidence in support of the Petition. The CINA Report could not be used to both state the allegations in the CINA petition and as evidence to substantiate the allegations in the petition. For these reasons, the circuit court’s factual findings in the contested adjudicatory hearing, which were based solely on the unadmitted Report and proffers by the parties, were clearly erroneous.

Accordingly, the judgment of the circuit court was vacated, and the case was remanded for further proceedings.

COMMENTARY: M.H.’s father argued that dismissal was the proper remedy for the Department’s failure to offer evidence. However, the special purpose of Maryland’s juvenile statutes is not ordinarily best served by dismissal of the proceedings. In re Keith G., 325 Md. 538, 545 (1992). In this case, the CINA Report, which was incorporated into the petition, alleged in part that two-year-old M.H. was burned by a cigarette, was in an extremely unkempt home, and was in the presence of his parents while they used drugs. Based on the totality of M.H.’s circumstances and the purpose of the CINA statute, remand was the appropriate remedy. See In re Michael G., 107 Md. App. 257, 268–69 (1995).

Pursuant to CJP §3-817, the circuit court would be required to hold an adjudicatory hearing to determine whether the allegations in the CINA petition were proven by a preponderance of the evidence. If the allegations in the petition were disputed, a contested adjudicatory hearing would ensue, during which the Department would be required to present evidence in support of the petition. At the conclusion of the hearings, the circuit court would be required to enter a new adjudication and disposition order, along with a permanency plan. On remand, the custody arrangement in place for M.H. would be maintained while the juvenile court conducted the hearings on the matter.

  

PRACTICE TIPS: In case seeking to have a child declared a Child in Need of Assistance, unless the juvenile court directs otherwise, a local department of social services shall provide all parties with a written report at least ten days before any scheduled disposition, permanency planning, or review hearing.

Family Law

Visitation

BOTTOM LINE: Under Maryland Code, Family Law Article §9-105, which states that a circuit court may grant a parent who has wrongfully been denied visitation “makeup” visitation in a manner consistent with the best interest of the child, the circuit court did not abuse its discretion in denying makeup visitation time to a father who had unjustifiably been denied visitation access where the court found that such a denial was in the best interests of the child.

CASE: Alexander v. Alexander, No. 1320, Sept. Term, 2020 (filed July 28, 2021) (Judges Friedman, Ripken & SALMON (Senior Judge, Specially Assigned)).

FACTS: Shelton Alexander and Tamara Alexander married in 2004. In August 2006, they had a son, “S.” The marriage ended on July 28, 2014 when the circuit court entered a final judgment of divorce. Shelton appealed from the entry of that judgment, but it was affirmed by the Court of Special Appeals.

More litigation followed, most of it concerning custody and visitation issues. In 2017, Shelton moved to modify custody, visitation and child support. In October of that year, Tamara filed a counter-motion asking the circuit court to grant her sole legal and primary physical custody of S. Following a hearing, the circuit court filed a final custody order, which granted Tamara sole legal and primary physical custody of S.

In the order, Shelton was granted access to S. every other weekend from after school on Friday until Monday morning, plus every Wednesday evening from 6:30 p.m. to 8:15 p.m., so that S. could attend a church youth group. The court set forth in its order a detailed holiday schedule and granted each party two-week blocks of summer access in July, with the orders of the blocks alternating year-to-year. Shelton appealed the order. The Court of Special Appeals affirmed.

In March 2020, while Shelton’s appeal was still pending, Tamara sent Shelton an email stating that, given that S. had type 1 diabetes “and thus his vulnerability to getting serious complications from COVID-19 if he contracts the Coronavirus, I plan on keeping him here at home until the CDC Coronavirus guidelines are lifted and schools are back in session. We can discuss makeup time once it is safe to do so.”  During the next few days, several emails between Shelton and Tamara were exchanged. Shelton took the position that Tamara had no right to disobey a court order and that obeying the visitation order would not endanger S.’s health.

Tamara maintained that because she had been given the authority to make medical decisions for S., she had the right to ensure his safety by halting, temporarily, Shelton’s right to have visitation with his son. Therefore, she announced, Shelton’s weekend visitation with S., scheduled for March 20, 2020, would be canceled, as well as future visitation until school reopened. In an email to Shelton dated March 19, 2020, she wrote that because waiting for school to resume might be an “untenable resolution,” she would give Shelton extended Facetime/virtual time with him over the weekend for gaming or for you to just spend time with him.” She further asked Shelton to agree that everyone in both households get tested for the coronavirus as soon as testing became available to the general public.

The parties did not resolve their differences. On March 27, 2020, Shelton filed an “Emergency Motion to Enforce Court’s Order Regarding Access During COVID[-]19 Pandemic.” Shelton asked the court to grant his emergency motion and sign an order: (1) requiring Tamara to immediately comply with the terms of the final custody order; (2) granting Shelton extra visitation as “make-up time” for the period that Tamara had withheld visitation; and (3) grant him attorney’s fees.

Following a hearing on September 10, 2020, the judge denied Shelton’s emergency motion and ordered. The court ordered that the parties resume Shelton’s every-other-weekend visitation schedule, with Shelton picking up S. at 3:30 p.m. on designated Fridays while S. was in school virtually and after school once school again resumed meeting in person. The court denied Shelton’s request for attorney’s fees.

Shelton appealed to the Court of Special Appeals, which affirmed the judgment of the circuit court and remanded the case.

LAW: Shelton argued that the motions judge abused her discretion in denying him “makeup time.” Specifically, Shelton took issue with the part of the judge’s opinion that read, “I’m not going to give you any make-up time because it’s not about making you whole. It is about [S.’s] daily life.” Shelton pointed to Maryland Code (2019 Repl. Vol.), Family Law Article, §9-105, which states, “In any custody or visitation proceeding, if the court determines that a party to a custody or visitation order has unjustifiably denied or interfered with visitation granted by a custody or visitation order, the court may, in addition to any other remedy available to the court and in a manner consistent with the best interests of the child, take any or all of the following actions: (1) order that the visitation be rescheduled; (2) modify the custody or visitation order to require additional terms or conditions designed to ensure future compliance with the order; or (3) assess costs or counsel fees against the party who has unjustifiably denied or interfered with visitation rights.” (Emphasis added.)

In enacting §9-105, the General Assembly used the word “may” with regard to makeup time. The word “may” is generally considered to be permissive, as opposed to mandatory, language. Board of Physician Quality Assurance v. Mullan, 381 Md. 157, 166 (2004). As such, it was not mandatory that the court award makeup time when, as here, one parent unjustifiably denies another visitation. Thus, in order for Shelton to prevail as to the issue of makeup time, it was necessary that he demonstrate that the motions judge abused her discretion in not granting him makeup time.

Relying on §9-105, Shelton contended that “Maryland law specifies that ordering the rescheduling of visitation is just one of the remedies available to the court for the purpose of making the party, which was unjustifiably denied visitation, whole.” However, contrary to Shelton’s assertion, the statute does not specify that the purpose of §9-105 is to “make whole” the party that is unjustifiably denied visitation. The statute simply gives the court the option of ordering make-up time; the court is not required to exercise that option. In fact, the statute provides that in order to exercise the option, such an award must be “consistent with the best interests of the child.”

Here, the motions judge explained that she did not believe it to be in the best interests of S. to order makeup time. The court’s decision was understandable. At the time of the September 10, 2020 hearing, approximately three and one-half months had expired since Tamara had allowed Shelton to resume visitation in accordance with the court order. Arguably, after that lapse of time, it might have been disruptive to S.’s routine if, rather than keeping him on the every-other-weekend visitation schedule with Shelton, the court ordered that Shelton have access for ten straight weekends as Shelton requested.

It was true, as the motions judge stated, that Tamara’s actions in denying visitation to Shelton for almost two months was harmful to S. That fact, however, did not necessarily mean that the harm could be erased or even ameliorated by ordering makeup time, nor did it mean that it would be in S.’s best interests to do so. It was clear that the trial judge knew what remedies were available to her under §9-105 of the Family Law Article, and the wording of the statute makes it clear that it is within the court’s discretion as to whether to utilize any of the remedies set forth in §9-105. For these reasons, Shelton did not meet his heavy burden of showing that the trial judge abused her discretion by refusing to grant him makeup time with his son.

Accordingly, the judgment of the circuit court was affirmed.

COMMENTARY: Shelton further argued that the trial judge erred in modifying the court-ordered access for Shelton and in denying the motion to enforce Wednesday-night access, which Tamara denied in part for over a year. This argument concerned the fact that Tamara brought S. to Shelton’s church’s youth group at 6:45 p.m. and sometimes at 7:00 p.m., rather than at 6:30 p.m., the time set forth in the final custody order. However, it was clear from the testimony that, with one exception, Tamara delivered S. to the meetings at the time those meetings actually started, which was always after 6:30 p.m. The one exception was on Wednesday, March 18, 2020, when Tamara, due to the coronavirus pandemic, did not deliver S. to the meeting at all.

At the hearing, Shelton never indicated that S. was ever late for the youth group meetings. Instead, he took the rigid position that Tamara’s conduct constituted a violation of his right to access. Even assuming, arguendo, that Tamara was wrong in failing to deliver S. to the youth group meetings at 6:30 p.m., by the time of the September 2020 hearing, those meetings were all being held virtually and, as far as shown by the record, S. was on time for the virtual meetings. Because S. never was late for the youth group meetings, it could not possibly have been in S.’s best interests to award makeup time on the grounds that S. did not arrive at the youth group meetings earlier than the scheduled start time. And, aside from awarding makeup time, there was nothing else the judge could have done to remedy this “wrong.” As such, this argument was with merit.

Shelton also contended that the trial judge erred in failing to award him attorney’s fees. Under Family Law Article, §12-103, the court may award to either party the costs and counsel fees that are just and proper under all the circumstances in any custody or visitation proceeding, taking into account the financial status of each party, the needs of each party, and whether there was substantial justification for bringing, maintaining, or defending the proceeding. Here, the motions judge did not make a finding that Tamara lacked substantial justification in defending against Shelton’s motion to enforce. It could not be said that “no reasonable person would take the view adopted by the trial court. As such, there was no abuse of discretion  

  

PRACTICE TIPS: A trial court is required to make its own independent decision as to the ultimate disposition of any case, although it may be guided by the recommendations of a magistrate.

Workers’ Compensation

Offset

BOTTOM LINE: Under Labor and Employment Article §9-610(a)(l), where an employee’s service-connected total disability retirement compensated for any and all work-related injuries he sustained in his employment with the county, he could not also receive a permanent partial workers’ compensation award.

CASE: Spevak v. Montgomery County, Maryland, No. 893, Sept. Term, 2019 (filed July 28, 2021) (Judges Leahy, Reed & BEACHLEY).

FACTS: Patrick Spevak was employed by Montgomery County as a firefighter from 1979 to 2010. He sustained a back injury during his employment and, as a result of that injury, retired in 2010 after being granted a service-connected total disability retirement. Since 2010, Spevak had been receiving retirement benefits amounting to approximately 70 percent of his highest salary.

Spevak’s hearing subsequently deteriorated, and in 2016 he filed a workers’ compensation claim based on occupational hearing loss. In 2017, the Workers’ Compensation Commission found that Spevak’s hearing loss was causally related to his employment and awarded him permanent partial disability benefits as a result of a 21-percent hearing loss in his left ear. However, the Commission determined that Spevak’s permanent partial benefits were completely offset pursuant to §9-610(a)(1) of the Labor and Employment Article (“LE”), which states that, except for benefits subject to an offset under §29-118 of the State Personnel and Pensions Article, if a statute, charter, ordinance, resolution, regulation, or policy, regardless of whether part of a pension system, provides a benefit to a covered employee of a governmental unit or a quasi-public corporation that is subject to this title under §9-201(2) of this title or, in case of death, to the dependents of the covered employee, payment of the benefit by the employer satisfies, to the extent of the payment, the liability of the employer and the Subsequent Injury Fund for payment of similar benefits under this title.

Spevak sought judicial review in the circuit court. Both parties moved for summary judgment. Following a hearing, the circuit court granted summary judgment in favor of the County, concluding that because Spevak’s service-connected total disability retirement benefits and the permanent partial disability workers’ compensation benefits both resulted from a work-related injury, the benefits were “similar” under LE §9-610. The court further found that Spevak was limited to “one wage loss replacement.” Therefore, the court applied the statutory offset.

Spevack appealed to the Court of Special Appeals, which affirmed the judgment of the circuit court.

LAW: Spevak acknowledged that LE §9-610 allows an employer to offset workers’ compensation payments if “similar benefits” are received by a covered employee of a governmental unit pursuant to “a statute, charter, ordinance, resolution, regulation or policy. Spevak contended, however, that because his service-connected total disability retirement was awarded based on his back injury and the permanent partial disability workers’ compensation award resulted from his later-developed hearing loss, the two benefits did not result from the “same injury.” Therefore, he argued, the LE §9-610 offset did not apply.

No Maryland case had previously considered whether the LE §9-610(a) offset applies when an employee is receiving service-connected total disability retirement benefits based on one injury and is then awarded permanent partial workers’ compensation benefits based on a second, separate injury. In support of his contention, Spevak relied on the holding of the Court of Appeals in Reger v. Washington Cty. Bd. of Educ., 455 Md. 68 (2017). Reger worked as a custodian for the Washington County Board of Education and injured his back and neck at work while moving a cafeteria table. Id. at 77. Because of his injuries, he was unable to perform his regular custodial work, and he was granted temporary total disability benefits by the Workers’ Compensation Commission. Id. Additionally, Reger sought accidental disability retirement benefits through the State Retirement Agency. Id. at 82. The State Retirement Agency denied accidental disability retirement but approved ordinary disability retirement benefits based on his back injury. Id. at 82–83.

In response to the request of the Board of Education to apply the LE §9-610(a) offset, the Commission found that “during all three periods in which Reger received temporary total disability benefits, he also received ordinary disability retirement benefits. Id. at 88. Thus, the Commission ruled that the LE §9-610(a) offset applied, and found that the employer was entitled to a credit in the amount of ordinary disability retirement benefits paid while Reger was also receiving temporary total disability benefits, which the employer could apply against future workers’ compensation awards. Id. Reger challenged the offset on judicial review to the circuit court. The circuit court and the Court of Special Appeals affirmed the Commission’s determination that the offset applied. Id. at 91. The Court of Appeals affirmed, but expressly rejected the “wage loss” theory, instead relying on a “same injury” theory derived from several appellate decisions interpreting LE §9-610.

However, the Reger decision was not controlling here. For one, Reger involved a single-injury claim, whereas Spevak’s case involve two injuries: his back injury and his subsequent hearing loss. In Reger, the Court compared the evidence that supported Reger’s ordinary disability retirement claim with the evidence supporting his workers’ compensation claim. Because the same injury evidence was used to support both claims, the Court held that the offset applied. Thus, the Reger decision was in perfect accord with all of the service-connected disability retirement offset cases holding that, to determine whether the offset applies to an ordinary disability retirement, the tribunal must determine whether the ordinary disability retirement was awarded based on the same service-connected injury.

In assessing Spevak’s case, it was necessary to consider the nature and legal effect of Spevak’s service-connected total disability retirement. Section 33-43 of the Montgomery County Code, which governs “disability retirement” for County employees, states that a member may be retired on a service-connected disability retirement if the member is totally or partially incapacitated as the natural and proximate result of an accident occurring, or an occupational disease incurred or condition aggravated while in the actual performance of duty. As defined in §33-43(b), “partial incapacity” means a member’s inability to perform one or more essential functions of the position the member holds because of impairment that: (1) is unlikely to resolve in the next 12 months; (2) may be permanent; and (3) does not prevent the member from performing any other substantial gainful activity. “Total incapacity” is defined as the member’s inability to perform substantial gainful activity because of an impairment that: (1) is unlikely to resolve in the next 12 months; and (2) may be permanent. Thus, the principal definitional difference between partial and total incapacity in the Montgomery County Code is that partial incapacity “does not prevent the member from performing any other substantial gainful activity.”

Spevak was awarded a “total incapacity” service-connected disability retirement, pursuant to which he received, tax-free, approximately 70 percent of his final earnings. Because Spevak was retired on a “total incapacity service-connected disability retirement” for which he received 70 percent of his final earnings, it would make no difference whether he was totally disabled due to his back injury, his occupational hearing loss, or a combination of both his back injury and hearing loss. Service-connected total disability retirement and a permanent total disability award under workers’ compensation law arising from the same employment are “similar benefits” under LE §9-610. Both sets of benefits are “comparable” because both are based on an employee’s service-connected permanent total disability from the same employment, and both sets of benefits are also definitionally comparable.

Thus, when an employee is granted a service-connected “total incapacity” disability retirement and a workers’ compensation permanent total disability award, the benefits paid are the same whether the total disability is traceable to one work-related injury or multiple work-related injuries. Because a permanent total disability award would be subject to the offset, Spevak’s permanent partial disability workers’ compensation award was a fortiori subject to the offset. Given that Spevak’s service-connected total disability retirement compensated for any and all work-related injuries he sustained in his employment with Montgomery County, he could not also receive a permanent partial workers’ compensation award.

Accordingly, the judgment of the circuit court was affirmed.

COMMENTARY: Spevak also argued that the Legislature demonstrated the ability to limit benefits in LE §9-503(e), which applies to certain occupational diseases: “benefits received under this title shall be adjusted so that the weekly total of those benefits and retirement benefits does not exceed the weekly salary that was paid.” In Polomski v. Mayor & City Council of Balt., 344 Md. 70, 82 (1996), the Court of Appeals held that LE §9-610 and LE §9-503 and their predecessors “say different things” and therefore “mean different things.”

The offset provisions in LE §9-610(a) and LE §9-503(e) were both established in 1971. That the Legislature has recodified and repeatedly amended both statutes since then, but has not substantially altered either offset provision after 50 years, implies that it is satisfied with the Courts’ interpretations. See Plein v. Dept. of Labor, 369 Md. 421, 433 (2002). In light of the substantial caselaw construing the “similar benefits” language of LE §9-610 over the past 50 years and the understanding that the General Assembly is aware of such interpretations, it could be concluded that the language in LE §9-503(e) that limits the employee’s recovery to his or her “weekly salary” – a “wage loss” limitation expressly disavowed by Reger – did not inform the Court’s interpretation of LE §9-610.

  

PRACTICE TIPS: Depending on the employer, retirement benefits based on a disability from a work-related injury are referred to by various terms, including “service-connected disability,” “accidental disability,” or “special disability.”