Automobile Trade Ass'n v. Harold Folk Enterprises, Inc.

COLE, Judge. The central issue we must decide in this case is whether referral agents of United Buying Service (UBS), an automobile referral sales business, must satisfy the licensure requirements for vehicle salesmen under Md.Code (1984 Repl. Vol.) §§ 15-401 to -412 of the Transportation Article. We recount those facts necessary to place this issue in proper perspective.

UBS is an automobile referral sales business with operations in Virginia, New York, Colorado, the District of Columbia, and, since 1967, Maryland. UBS arranges sales of new vehicles to individuals belonging to member-groups, such as companies, labor organizations, and other similar entities. These individuals contact a UBS referral agent after locating a desired vehicle in the UBS price book, which lists various makes and models of new vehicles at a price that is discounted from the dealer’s normal list price. The individual provides the UBS referral agent with information concerning the desired automobile, such as the make, model, and options.

In return, the UBS referral agent sends the customer a “purchase certificate” for that vehicle. The referral agent instructs the customer to take the certificate to a dealer who has agreed to accept UBS referrals under a verbal agreement between UBS and the dealership. Under this agreement, the dealer must sell that vehicle to the customer at the UBS price. As consideration for UBS referrals, the dealer pays UBS $30.00 per sale. ⁶⁴⁷ Approximately ninety percent of UBS’s business is derived from automobile referrals, with the remaining ten percent derived from furniture referrals.

The Chevy Chase — based organization employs about twenty five individuals, most of whom are UBS referral agents. UBS referral agents are responsible for dealing with prospective customers, often over the telephone, concerning vehicles listed in the UBS price book. UBS hires and trains these referral agents, and pays their salaries, workmen’s compensation insurance, medical benefits, and other expenses. All UBS referral agents transact business from the Chevy Chase office.

On the basis of a 1982 opinion by the Attorney General, the Motor Vehicle Administration (MVA) informed UBS that it would not renew the licenses of its referral agents, which were due to expire on April 30, 1983. In response, UBS filed a declaratory judgment action in the Circuit Court for Anne Arundel County seeking injunctive and mandamus relief against the MVA. The Automobile Trade Association of Maryland (ATA), an association of new automobile dealers, intervened in this suit. The trial court found that UBS referral agents were required to be licensed because they were “vehicle salesmen,” and that these referral agents met the licensure requirements because they were “employed by” licensed dealers.

Accordingly, on April 28, 1983, the trial court ordered that the MVA renew the licenses of the UBS referral agents. The MVA appealed to the Court of Special Appeals but we granted certiorari before judgment was entered by that Court. I Before we can reach the merits of this case it is necessary for us first to analyze a procedural issue raised by the appellants. In its opinion and order, the trial court made several findings to which the appellee did not file a cross-appeal.

Appellants argue that the appellee’s failure to file a cross-appeal bars appellate review of the trial court’s finding that UBS referral agents are “vehicle salesmen” within ⁶⁴⁸ the meaning of § 15-101(e) of the Transportation Article and are thus required to be licensed under Maryland law. The Maryland Rules do not contain extensive requirements for cross-appeals. For review by this Court, Maryland Rule 812 b provides in general that any other party may file a petition for writ of certiorari within ten days of the filing of the first timely petition for writ of certiorari or within the time specified in Maryland Rule 812 a. Similarly, for appeals to the Court of Special Appeals, Maryland Rule 1012 f generally requires any other party to file an order for appeal within ten days from the date on which the first order for appeal was filed.

Despite the lack of detailed guidance in the rules, we have discussed on numerous occasions when a cross-appeal properly lies. E.g., Joseph H. Munson Co. v. Secretary of State, 294 Md. 160 , 448 A.2d 935 (1982), aff'd, ___ U.S. ___, 104 S.Ct. 2839 , 81 L.Ed.2d 786 (1984); Offutt v. Montgomery County Bd. of Educ., 285 Md. 557 , 404 A.2d 281 (1979). As a general matter, a party to a trial court proceeding must file a valid, timely order of appeal to seek direct appellate review and reversal of the trial court’s judgment. See Joseph H. Munson Co. v. Secretary of State, supra, 294 Md. at 168 , 448 A.2d at 939-40 .

In Munson, we held that dn appellee could not assert on appeal that the appellant lacked standing to challenge the constitutionality of a statute because the appellee failed to file a cross-appeal from a declaratory judgment that upheld the validity of that statute. Id. at 168 , 448 A.2d at 940 . In writing for the Munson Court, Judge Eldridge reasoned that the lack of standing could not be raised for the first time by the appellee on appeal because lack of standing would not serve as an alternate ground for affirming the trial court’s decision on the merits. Conversely, where a party has an issue resolved adversely in the trial court, but receives a wholly favorable judgment on another ground, that party may, as an appellee and without taking a cross-appeal, argue as a ground for affirmance the matter that ⁶⁴⁹ was resolved against it at trial.

Offutt v. Montgomery County Bd. of Educ., supra, 285 Md. at 564 n. 4, 404 A.2d at 285 n. 4; State Comm’n on Human Relations v. Amecom Div., 278 Md. 120 , 128 n. 2, 360 A.2d 1 , 3 n. 2 (1976). In Offutt , the appellee school board received a judgment wholly in its favor, although the trial court ruled that it had bargained in bad faith. The school board filed a cross-appeal. Under these circumstances, we determined that the cross-appeal was inappropriate because a finding of good faith would have been an alternate ground to support the trial court’s ruling.

In Amecom Div., we noted that the appellee was not required to file a cross appeal to assign any error of the trial court in support of the final decree when the appellee seeks only affirmance of that final decree. In light of these principles, it is apparent to us that the appellee in the case sub judice was not required to file a cross-appeal to argue in this Court that its referral agents are not “vehicle salesmen” under § 15-101(e) of the Transportation Article. The appellee received a judgment wholly in its favor at trial insofar as that court denied the relief sought by appellants. Without taking a cross-appeal, appellee may argue as a ground for affirmance the matter that was resolved against it at trial.

Thus, appellee can argue that we should affirm the trial court’s final order on an alternate ground, i.e., that the UBS referral agents do not come within the definition of vehicle salesmen and therefore do not have to be licensed. Although this issue was resolved against appellee at trial, it nevertheless provides an alternate ground for affirmance. We therefore hold that the appellant’s contention that appellee is barred from raising the contested issues because no cross-appeal was taken is without merit. II UBS and Maryland’s vehicle salesmen licensing laws have often been at odds since UBS initiated its Maryland opera ⁶⁵⁰ tion in 1967.

Barely one year after UBS’s foray into Maryland, the MVA issued a bulletin to all automobile dealers on May 21, 1968, indicating that they should not enter into selling arrangements with any person not licensed or bonded in accordance with Maryland law. At the MVA’s request, the Attorney General of Maryland issued an opinion on the matter. The Attorney General opined that consumer buying services were “salesmen” under former Md.Code 1957, 1967 Repl.Vol.), Art. 6672, § 2(49a) (current version at Md.Code (1984 Repl.Vol.), § 15-101(e) of the Transportation Article) and that dealers could not participate in an automobile sales transaction with an unlicensed buying service without violating the applicable licensing laws. 53 Op. Att’y Gen. 402 (1968).

On November 20, 1968, MVA directed UBS to cease and desist its operations. After discussions between UBS and the MVA, UBS modified its purchase certificate by having it state that UBS was the agent of the purchaser, not the dealer. Based on this modification, the MVA approved the UBS operation on January 2, 1969. In 1970, the General Assembly undertook an extensive revision of Maryland’s motor vehicle laws.

This revision expanded the definition of “vehicle salesmen” to include an individual who “induces or attempts to induce any person to buy or exchange” a vehicle and who “receives or expects to receive” any “value from either the seller or purchaser” of a vehicle. Chapter 534 of the 1970 Laws of Maryland (codified at Md.Code (1957, 1970 Repl.Vol.), Art. 66½, § 1-210) (definition of “vehicle salesman”). Based on this new definition, the MVA again issued a bulletin that advised automobile dealers not to operate in conjunction with buying services that induce or attempt to induce the sale of vehicles, unless the representative of the buying service holds a valid salesman’s license covering employment by a particular registered dealer. Bulletin from Chief, Dealer Licensing Services, Maryland Dept. of Motor Vehicles (June 16, 1971). ⁶⁵¹ Shortly after the issuance of this bulletin UBS filed suit in the Circuit Court for Montgomery County seeking an injunction prohibiting the MVA from advising dealers not to transact business with UBS and a declaration that the licensing laws were inapplicable to UBS and, moreover, were unconstitutional.

Settlement negotiations resulted in what the parties characterize as an “accommodation letter” between UBS and MVA. Under the terms of this May 5, 1972 letter from the Deputy Administrator of the MVA to UBS’s counsel, the MVA explained that UBS would be in compliance with the licensing laws if the UBS representatives became licensed vehicle salesmen. To accomplish this UBS representatives had to be licensed through, and bonded by, a licensed dealer. UBS followed this procedure for the next decade, at which time the Attorney General issued an opinion adverse to UBS.

This opinion, requested by the Secretary of Transportation, dealt with whether UBS referral agents had to comply with the appropriate licensure requirements. 67 Op.Att’y Gen. 393 (1982). The Attorney General noted that Maryland’s licensing and regulatory requirements fail to accommodate adequately the operation of automobile buying referral services such as UBS, and that these businesses are unauthorized to the extent that they receive or expect to receive compensation for their referrals. More specifically, the Attorney General stated that UBS referral agents are “vehicle salesmen,” but that they are ineligible for licenses because they are not “employed” by licensed dealers as required under § 15-404. The opinion concluded: In summary, it is our opinion that the statutory licensing scheme does not permit the operation of car buying/ referral services in the manner described above.

The licensing scheme makes it lawful only for licensed dealers and their licensed salesmen to participate in vehicle sales in Maryland. Furthermore, the General Assembly has long required that, as a condition on which a salesman’s license may be granted, the salesman must be an employee of the dealer, not some other entity. The mere align ⁶⁵² ment of buying/referral service staff members as vehicle salesmen with a dealer does not satisfy this employment requirement. This opinion in turn precipitated the appellee’s declaratory judgment action and this subsequent appeal. ■ A Central to our analysis is whether UBS referral agents are vehicle salesmen within the meaning of § 15-101(e) of the Transportation Code.

The statute provides: (e) Vehicle Salesman. — (1) “Vehicle salesman” means, except as provided in paragraph (2) of this subsection, any individual who: (i) For a commission or other compensation, under any form of agreement or arrangement with a dealer, buys, sells, or exchanges or negotiates or attempts to negotiate a sale or exchange of an interest in a vehicle of a type required to be registered under Title 13 of this article; or (ii) Induces or attempts to induce any other person to buy or exchange an interest in a vehicle of a type required to be registered under Title 13 of this article and receives or expects to receive a commission or other compensation from either the seller or the buyer of the vehicle. (2) “Vehicle salesman” does not include: (i) A person described in subsection (b)(2) of this section; or (ii) An individual acting as a representative of a person described in subsection (b)(2) of this section. Based on this definition, the trial court determined that UBS’s referral agents fall within the definitional purview of § 15-101(e)(ii) because these agents induce or attempt to induce automobile sales. The parties correctly note that the meaning of “induce” and “attempts to induce” as used within that statute is of critical importance in ascertaining whether the referral agents are vehicle salesmen.

Because ⁶⁵³ the Transportation Article does not define these terms, we must resort to well-settled canons of statutory construction to determine their meaning. As we have often stated: [I]t is the duty of the courts to declare the law as the General Assembly has made it, that is, to ascertain and give effect to the intention of the legislature. This we have said on many occasions is the cardinal rule of statutory construction. In ascertaining the legislative intent we look to the language used, and when such language is clear and unambiguous, it must be held to mean what it expresses.

However, where the language is ambiguous and of doubtful import, the duty of the courts is to ascertain and give effect to the true legislative intent. In short, the judicial function of statutory construction lies wholly within the domain of ambiguity and uncertainty. When exercising this function the courts may resort to extrinsic aids such as examining the history of the passage of the law, the reports of committees and commissions, the introduction of amendments and testimony given before legislative committees. As we said in Berry v. State, [ 287 Md. 491, 496 , 413 A.2d 557 (1980)], “where the statutory language is of doubtful meaning, the Court must venture beyond the words of the statute and consider the subject matter of the statute, the purpose underlying its enactment, and the object sought to be accomplished^]” Bledsoe v. Bledsoe, 294 Md. 183, 188-89 , 448 A.2d 353, 356 (1982) (citations omitted); see Board of Examiners in Optometry v. Spitz, 300 Md. 466, 474 , 479 A.2d 363, 367 (1984); City of Baltimore v. Hackley, 300 Md. 277, 283 , 477 A.2d 1174, 1177 (1984).

In light of these well-settled rules, we must determine the meaning of “induce” and “attempts to induce” as those terms are used in § 15 — 101(e)(ii) of the Transportation Article. 1 ⁶⁵⁴ Dictionary meanings are a useful source in determining the “natural and ordinary signification” of the terms involved. Webster’s Third New International Dictionary 1154 (1976) defines “induce” in the following manner: la: to move and lead (as by persuasion or influence ...: prevail upon: INFLUENCE, PERSUADE ... b: to inspire, call forth, or bring about by influence or stimula- ' tion ... 3a: to bring on or bring about: EFFECT, CAUSE syn PERSUADE, PREVAIL: INDUCE may indicate overcoming indifference, hesitation, or opposition, usu. by offering for consideration persuasive advantages or gains that bring about a desired decision ... PERSUADE may suggest a winning over by an appeal, entreaty, or expostulation addressed as much to feelings as to reason ... PREVAIL may be used in situations in which strong opposition or reluctance is overcome by sustained argument and entreaty[.] Although induce, persuade, and prevail are considered synonyms, “induce suggests a subtler leading of a person to a course of action so that the decision seems finally to come from him[.]” Webster’s New World Dictionary 1062 (2d ed. 1982).

A leading law dictionary further defines induce as “[t]o bring on or about, to affect, cause, to influence to an act or course of conduct, lead by persuasion or reasoning, incite by motives, prevail on.” Black’s Law Dictionary 697 (5th ed. 1979). These definitions of induce suggest that that term is susceptible to either a restrictive or expansive interpretation. Under a restrictive interpretation, the action taken must actually accomplish the goal, which in this case is the sale of a new vehicle. A less restrictive interpretation would be that the action taken lead or influence one toward ⁶⁵⁵ the desired goal.

Irrespective of the appellee’s argument that “induce” be given a restrictive meaning, it is clear to us that the General Assembly intended a significantly broader meaning by its use of the language “attempts to induce.” Appellee seeks to avoid the effect of this language by urging that we give “attempt” its criminal law meaning of a specific intent to do a criminal act. This argument is pure sophistry because it disregards the natural and ordinary signification of the term “attempt.” The fallacy in appellee’s contention is best illustrated by the definition of “attempt”: “In statutes and in cases other than criminal prosecutions an ‘attempt’ ordinarily means an intent combined with an act falling short of the thing intended. It may be described as an endeavor to do an act, carried beyond mere preparation, but short of execution.” Id. at 116 (emphasis supplied.) Another dictionary defines “attempt” as follows: “to make an effort to do, accomplish, solve, or effect ... — often used in venturous or experimental situations sometimes with implications of failure[.]” Webster’s Third New International Dictionary, supra, at 140. These definitions, together with our obligation to ascertain and carry out the real legislative intent, compels us to conclude that UBS referral agents induce or attempt to induce vehicle sales within the meaning of § 15 — 101(e)(ii) of the Transportation Article.

The act of referring a customer to a specific vehicle dealer or dealers serves “to influence,” “to bring on or about”, “to affect,” and “to aid” the sale of a vehicle by that dealer to that particular customer. The customer expects to receive a lower purchase price and a faster transaction as the result of the referral made by the UBS agent. The expectation of these special services and benefits are presumably not readily available at other dealers. Indeed, one dealer testified that UBS referred customers enjoy savings between $800 — $2,-000 over non-UBS customers.

Of course, a sale does not always have to result by virtue of the referral because the ⁶⁵⁶ statute uses the language “attempts to induce.” See 67 Op.Att’y Gen., supra, at 401-02. Appellee discounts this reasoning by maintaining that its operation simply facilitates or carries out a purchase already decided upon by the buyer. This argument proves too little. As an initial matter, assuming arguendo that the customer may have already decided to purchase a specific automobile before contacting a UBS referral agent, the customer has obviously not decided from which dealer to purchase the vehicle.

By referring the customer to a specific dealer, the UBS referral agent induces or attempts to induce the sale of a vehicle between that dealer and that customer. The argument also proves too much because it rests on the unsupported proposition that every customer who contacts a UBS referral agent has already firmly decided upon the desired vehicle’s make, model, options, and accessories. Although there was testimony to the effect that UBS referral agents never discuss the price or options with potential customers, other testimony indicated that referral agents would apprise potential customers of recent price increases not reflected in the UBS price book. In addition, the UBS price book, which was offered into evidence, clearly encourages