Bayly Crossing, LLC v. Consumer Protection Division, Office of Attorney General

JAMES R. EYLER, J. This appeal arises from a civil administrative action by the Consumer Protection Division of the Maryland Office of the Attorney General (“CPD”) against appellants Julia B. Passyn, Theodore B. Passyn, Theodore B. Passyn, III (“the Passyns”), and Bayly Crossing, LLC. CPD charged appellants with failing to register under the Home Builder Registration Act (“HBRA”), Maryland Code (2004 Repl Vol., 2007 Supp.), 1 §§ 4.5-101 to 4.5-701 of the Business Regulation Article; ³⁰⁵ unfair and deceptive trade practices under the Consumer Protection Act (“CPA”), Maryland Code (2005 Repl.Vol., 2008 Supp.), §§ 13-101 to 13-501 of the Commercial Law Article; and failure to comply with a settlement agreement pursuant to CPA § 13-403(c)(l). The CPD, acting in its quasi-judicial role, 2 delegated the matter to the Office of Administrative Hearings (“OAH”), see Maryland Code (2004 Repl.Vol., 2008 Supp.), § 10-205(a), (b) of the State Government Article (“SG”), for proposed findings of fact and conclusions of law, and ultimately issued a Final Order ruling against appellants on all charges. Appellants filed a petition for judicial review pursuant to SG § 10-222(a) in the Circuit Court for Baltimore City, which affirmed the Agency’s decision in its entirety.

This appeal followed. Facts and Proceedings The Passyns purchased Bayly Crossing, LLC from Talbot Bank on November 19, 2002, with each Passyn acquiring a one-third interest. 3 At the time of the purchase, Bayly Crossing, LLC owned thirty lots in the “Bayly Crossing” subdivision located in Dorchester County, which consisted of nine finished lots and twenty-one unfinished lots. Bayly Crossing, LLC was not registered as a home builder with the Home Builders Registration Unit (“HBRU”) prior to the Passyns’ acquisition of the company, nor did any of the Passyns apply to register Bayly Crossing, LLC as a home builder following their purchase. ³⁰⁶ Over the 827 day period from October 11, 2002 to January 14, 2005, Bayly Crossing, LLC contracted with ten consumers to sell them homes in the Bayly Crossing subdivision. The form contract used by Bayly Crossing, LLC contained the following pertinent language: PURCHASER agrees to buy and SELLER agrees to sell and construct on Lot_, Phase_, in the subdivision known as “Bayly Crossing,” Dorchester County, in the State of Maryland (“Lot”), with improvements thereon to be known as_(Street Address), a house substantially similar to the seller’s model known as « » ❖ * ❖ 12.

CONSTRUCTION. (a) SELLER agrees to complete upon the aforesaid Lot, a dwelling substantially similar, as to workmanship, material, type of construction, floor plans, dimensions, detail and finish to the interior, exterior and structure, to SELLER’S Model House and/or floor plans, drawings, brochures, or any selling aids or displays utilized by SELLER as set forth above, which items have been inspected by PURCHASER 33. ACKNOWLEDGMENT OF RECEIPT OF CONSUMER INFORMATION PAMPHLET: On _ (date), my home builder, T.B. Passyn & Sons, Inc., MHBR # 455 Provided me with a copy of the consumer information pamphlet title “Buying a New Home-Consumer Rights and Remedies under Maryland Law” produced by the Consumer Protection Division of the Attorney General’s Office. The contracts were signed by Bayly Crossing, LLC, and Julia B. Passyn, Member, as “SELLER[s].” All payments for the sales were made to Bayly Crossing, LLC.

The bottom of the contract indicated that the document was copyrighted to “T.B. Passyn & Sons, Inc., August 1,1998.” ³⁰⁷ The contracts also contained an addendum titled “Builder’s Notice of Standards and Buyer’s General Release to Landowner and Buyer’s Acknowledgment of Receipt of Consumer Information Pamphlet.” 4 The addendum provided: T.B. Passyn & Sons, Inc. MHBR 455 is the Builder for the house on Lot_Phase_located in Bayly Crossing, Cambridge, MD 21613 and hereby agrees to grant to the Buyers of said house a One-Year Limited Warranty in accord with the Standards set by the Residential Warranty Corporation, 5300 Derry Street, Harrisburg, PA---- In exchange for said Limited Warranty, the Buyer’s [sic] hereby grant a general release to Bayly Crossing, LLC (Theodore B. Passyn, Julia Beall Passyn and Theodore Passyn III[ ]) Landowners and their heirs, successors and assigns and forever discharge the said Bayly Crossing, LLC (Theodore B. Passyn, Julia Beall Passyn and Theodore Passyn III) from any and all actions or causes of action relating to the construction of the house on Lot-Phase _located at Bayly Crossing which Buyers have or may have against the said Bayly Crossing, LLC (Theodore B. Passyn, Julia Beall Passyn and Theodore Passyn III) now or in the future and also release the Builder from any and all items not covered either by said Limited Warranty or the Punch List.... Bayly Crossing was not registered as a home builder with the HBRU during the period when these sales occurred. Seven homes were constructed on lots owned by Bayly Crossing, LLC between November 19, 2002, and October 22, 2004, and they were built by T.B. Passyn & Sons, Inc., an HBRU-registered home builder. 5 On October 22, 2004, Bayly Cross ³⁰⁸ ing, LLC sold the remaining twenty-three lots to Gemcraft Forest Hill, LLC. In 2002, the CPD initiated an investigation of T.B. Passyn & Sons, Ine.’s home building practices, which led to litigation in the Circuit Court for Talbot County and a related administrative action.

The dispute was settled with a Final Order by Consent (“Consent Order”), executed on July 17, 2003, by Theodore B. Passyn, III, President, on behalf of T.B. Passyn & Sons, Inc., the Passyns individually, Jeston Harner, Jr. and Steven M. Sakamoto-Wengel, Assistant Attorneys General, and William Leibovici, “Assistant Attorney General and Chief [of the CPD].” 6 The Statement of Facts contained in the Consent Order included the following: 7. On January 7, 2003, the [HBRU] received an application to Renew Registration as a Home Builder in the State of Maryland for T.B. Passyn & Sons, Inc. [7] 8. The [HBRU] determined that T.B. Passyn & Sons, Inc. and its principals had a substantial history of open lawsuits, including an unsatisfied consumer judgment against its principal for a case that was pending after January 1, 2001, and liens that were not disclosed on the application. 9. Further, T.B. Passyn & Sons was served with an Administrative Subpoena from the Attorney General of Maryland requiring it to produce certain documents, including contracts pertaining to its activities as a builder on or before October 7, 2002.

T.B. Passyn & Sons ³⁰⁹ was not responsive to this request and the Division was forced to file a lawsuit against the company to obtain compliance, which also was not disclosed on the application forms. 10. Based on the failure of T.B. Passyn & Sons to disclose additional lawsuits, the unsatisfied consumer judgment, and the liens on the application forms, and the existence of unsatisfied judgment liens, the [HBRU] denied the application of T.B. Passyn & Sons to renew registration as a home builder in the State of Maryland on May 28, 2003. Under the terms of the Consent Order, the HBRU agreed to renew T.B. Passyn & Sons registration as home builder provided they complied with certain conditions. The Consent Order specified: 12.

This Final Order by Consent encompasses and pertains to new home building activities, whether individually or jointly, of Theodore B. Passyn, Sr., Theodore B. Passyn, III, Julia Beall Passyn and any entity in which they are or will be involved, and includes their agents, employees, successors and/or assigns. The Proponent and Respondents agree to the following. 13. None of the Respondents shall act as a Home Builder in Maryland as defined in Md.Code Ann., Bus. Reg. § 4.5-101® unless the Respondent has first registered with the Home Builders Registration Unit of the Consumer Protection Division as required by Md.Code Ann. Bus.

Reg. § 4.5-301, et seq. 19. Respondents agree that any violation of this Consent Order will be considered a second violation of the Home Builders Registration Act and the Consumer Protection Act for the purposes of Md.Code Ann., Com. Law II, § 13-410. On March 1, 2005, the Passyns and T.B. Passyn & Sons, Inc. brought a declaratory judgment action against the CPD attacking the validity of the Consent Order.

The Passyns and ³¹⁰ T.B. Passyn & Sons, Inc. subsequently amended the complaint to add the State as a defendant, and to add a charge that the CPD and the State violated their right to due process under Article 24 of the Maryland Declaration of Rights. 8 The circuit court granted summary judgment for the State and the CPD. This Court dismissed the appeal as to T.B. Passyn & Sons, Inc. for lack of standing, and affirmed the judgment against the Passyns individually. See T.B. Passyn & Sons, Inc., et. al. v. Consumer Protection Division, et. al., 185 Md.App. 741 , 747, Appeal No. 1042, Sept. Term, 2007 (unreported opinion filed Apr. 6, 2009) (hereinafter “T.B. Passyn & Sons ”). On July 12, 2005, the CPD initiated the present litigation, when it filed "with the Agency a Statement of Charges against the Passyns and Bayly Crossing, LLC, alleging violations of HBRA §§ 4.5-301 and 4.5-501 for failing to register as home builders; CPA § 13-303 for engaging in unfair and deceptive trade practices defined in CPA §§ 13-301(1) and 13-301(3); and CPA § 13^02(c)(l) for failing to comply with the Consent Order.

On July 14, 2005, the Agency granted the CPD’s request for a hearing and delegated authority to conduct the contested case hearing and render proposed findings of fact and conclusions of law to the OAH. An evidentiary hearing was scheduled for September 13, 2005. The Passyns and Bayly Crossing, LLC filed a Motion for Summary Decision on August 12, 2005, which the CPD opposed. The OAH heard the opposing motions on September 13, 2005, in lieu of the scheduled evidentiary hearing.

Following the hearing, the OAH issued a Proposed Ruling on Motion recommending that the Motion for Summary Decision be granted and concluding that neither the Passyns nor Bayly Crossing, LLC violated the HBRA or CPA. The CPD filed exceptions to the Proposed Ruling, and on May 30, 2006, the Agency issued an order in which it concluded that “Bayly Crossing was required to have registered as home builder at ³¹¹ the time that it entered into the contracts in which it undertook to construct new homes for consumers.” The Agency then remanded the case to the OAH “for any further proceedings required to resolve factual or legal issues that have not been resolved by the Agency’s ruling on this motion” and for the parties to “offer evidence for the record that they will want this agency to consider in determining the appropriate relief for any proven violations of the law.” On July 5, 2006, while the remand hearing was pending, the CPD filed an Amended Statement of Charges adding a charge for violating CPA § 13-303 by engaging in an unfair or deceptive trade practice as defined by CPA § 13-301(13). The remand hearing was held on August 22, 2006, and the OAH issued its Proposed Ruling and Decision on December 15, 2006, in which the Administrative Law Judge reached the following conclusions of law: Based upon the foregoing I conclude as a matter of law that the Respondents violated [HBRA] §§ 4.5-301 and 4.5-501 by failing to register as a home builder under the [HBRA], I further conclude as a matter of law that the Respondents violated [CPA] § 13-402(c)(l) by failing to comply with the Final Order of Consent by not registering as a home builder under the [HBRA]. I also conclude as a matter of law that the Respondents violated [CPA] § 13-301(13) by using a contract related to the sale of single family residential consumer realty that contained a clause limiting or precluding the buyer’s right to obtain consequential damages as a result of the seller’s breach or cancellation of the contract.

I further conclude that the Respondents did not violate [CPA] §§ 13-301(1) and 13-301(3) because they did not make misleading oral or written statements or representations that had the capacity, tendency or effect of deceiving or misleading consumers and did not omit a material fact by failing to register as home builders under the ³¹² [HBRA] or by failing to inform purchasers that they were not registered as home builders under the [HBRA]. Both parties filed exceptions to the Proposed Ruling and Decision with the Agency. On August 3, 2007, the Agency issued a Final Order, Findings of Facts and Conclusions of Law, and a Ruling on Exceptions. The agency first concluded that Bayly Crossing, LLC violated HBRA §§ 4.5-301 and 4.5-501 by failing to register as a home builder.

The Agency reasoned as follows: The [HBRA] defines a “contract purchaser” as “a person who has entered into a contract with a home builder to purchase a new home----” § 4.5-101(c). It defines “home builder” as a “a person that undertakes to erect or otherwise construct a new home.” § 4.5-101(f)(l). And, it requires a contract for the initial sale of a new home to include the “builder registration number of the seller of the new home.” § 14—117(j)(2)(i).[ 9 ] All of these sections support the proposition that the party entering into the contract with a consumer must be a registered home builder. The term “undertake” used in defining a home builder means to “put oneself under obligation to perform.” Webster’s Third International Dictionary (1968).

Bayly Crossing placed upon itself the obligation to “sell and construct” a new home for the consumer. Even if the contract had used different words, the result would have been the same as long as the contract still provided that the consumer was purchasing a new home. In addition to the obligations Bayly Crossing assumed in its contract with consumers, Maryland law also places on it the obligation to pay for all consequential damages caused by its breach or cancellation of the contract. Md.Code Ann., Com.

Law II § 13-301(13) (2005). In other words, Bayly Crossing remains liable if a purchaser is able to establish, among other things, that a new home was not ³¹³ constructed in the manner or with the quality required by the contract. The exemption of a real estate developer from having to register provided by § 4.5-101(f)(3)(iv) has to be read in harmony with the [HBRA’s] requirements relating to the purchasers and sellers of new homes. This exemption was intended to cover developers who do not play a direct role in the transactions with consumer [sic].

By entering into contracts undertaking to provide new homes to consumers, Bayly Crossing was acting as a home builder as that term is defined in the Act. In summary, after applying the uncontested facts to the [HBRA], this Agency has concluded that Bayly Crossing was required to have registered as a home builder at the time it entered into the contract in which it undertook to construct new homes for consumers. The Agency next detailed multiple violations of the CPA by Bayly Crossing, LLC. The Agency, citing Golt v. Phillips, 308 Md. 1, 9-10 , 517 A.2d 328 (1986), concluded that Bayly Crossing violated CPA §§ 13-301(1) and 13-303 by “implicitly [and falsely] representing] in their form contracts that Bayly Crossing L.L.C. was a properly registered home builder.” The Agency found that the primary source of this misrepresentation was the statement in the contract that Bayly Crossing, LLC would “sell and construct” a new home for the consumer.

Again citing Golt , the Agency further concluded that Bayly Crossing, LLC violated CPA §§ 13-301(3) and 13-303 by failing to disclose to consumers a material fact that it was not a registered home builder. The Agency additionally concluded that the provision contained in the addendum signed by consumers that discharged Bayly Crossing, LLC from “any and all actions or causes of actions relating to the construction of the house” restricted consumers’ right to bring actions for consequential damages resulting from the seller’s breach or cancellation of the contract, and thus violated CPA §§ 13-301(13) and 13-303. ³¹⁴ Finally, the Agency concluded that the Passyns violated the provision of the Consent Order requiring any entity they became associated with to register as a home builder, if required. The Agency determined that the Passyns’ noncompliance with the Consent Order violated CPA § 13-402(c) because “the parties agreed that [the Consent Order] would be subject to enforcement under Subtitle 4 of the [CPA] and that any such violation would be deemed a second violation of [the CPA].” For these violations, the Agency imposed penalties and costs on the Passyns and Bayly Crossing, LLC, jointly and severally, in the amount of $25,000 and $6,781.98, respectively. The Agency’s determination of whether to impose a civil penalty was guided by its analysis of the five factors in CPA § 13-410(d) as follows: 1.

Severity The Respondents in this case failed to register as a home builder that was engaged in entering into contracts with consumers in which it agreed to sell and construct new homes for the consumers. Respondents also used a general release form that violated the [CPA]. The Respondents also violated the terms of a Final Order by Consent that they had entered into in 2003. All of the Respondents’ violations are serious. 2.

Good Faith The Respondents did not operate in good faith in their dealings with the Proponent. The Respondents entered into a Final Order by Consent with the Proponent on July 17, 2003 in which they agreed to register in the future all their entities that were operating as home builders under the HBRA. At that time the Respondents had already sold four new homes to consumers through Bayly Crossing L.L.C. and subsequent to entering into the Final Order by Consent, they sold another five new homes to consumers through this unregistered entity. ³¹⁵ 3. Prior Violations There is a history of prior violations as evidenced by the Final Order by Consent previously entered into by the individual Respondents. 4.

Deterrent Effect of Amount of Penalty The civil Penalty must be sufficient to deter both the Respondents as well as other people from engaging in this or similar type of illegal conduct in the future. The Respondents were more than willing to ignore the HBRA law even after they had had a previous legal action brought against them for failing to comply with the Act. Imposing a substantial civil penalty is intended to deter them from ever doing anything like this again. A civil penalty has to convince these people that they will lose a lot of money if they get caught violating the law.

Changing the monetary bottom line is the only thing that will alter their conduct in the future. 5. Sufficiency of the Cease and Desist Order, including Restitution Consumers would not be protected from the Respondents in this ease if the Respondents were simply ordered to stop violating the law in the future. That is what the Final Order by Consent did. On August 29, 2007, Bayly Crossing and the Passyns filed a petition for judicial review of the Agency’s Final Order.

Following a hearing on July 14, 2008, the Circuit Court for Baltimore City issued an opinion affirming the Final Order. Bayly Crossing, LLC and the Passyns responded with this appeal. Questions Presented Appellants set out the following questions for our review, which we have rephrased and consolidated: 1. Was the Agency’s decision that Bayly Crossing, LLC was required to register as a home builder under the ³¹⁶ HBRA based upon an erroneous interpretation of law or unsupported by substantial evidence? 2.

Was the Agency’s decision that Bayly Crossing, LLC was required to disclose its unregistered status and that failure to disclose such status constituted a misrepresentation under the [CPA] based upon an erroneous interpretation of law or unsupported by substantial evidence? 3. Was the Agency’s decision that appellants violated CPA § 13-402(c)(l) by failing to comply with the Consent Order based upon an erroneous interpretation of law or unsupported by substantial evidence? 10 4. Was the Agency’s decision that it was not required to issue a new delegation of authority to the OAH after the Amended Statement of Charges was filed based upon an erroneous interpretation of law or unsupported by substantial evidence? 5. Was the Agency’s decision that Bayly Crossing, LLC violated the CPA by limiting a buyer’s right to obtain consequential damages for breach or cancellation of the contract based upon an erroneous interpretation of law or unsupported by substantial evidence? 6.

Was the Agency’s decision that appellants were jointly and severally liable for the actions of Bayly Crossing, LLC based upon an erroneous interpretation of law or unsupported by substantial evidence? 7. Was the Agency’s assessment of civil penalties against appellants arbitrary and capricious or excessive? As we explain below, we answer these questions in the negative, and thus, we shall affirm the decision of the Agency. Standard of review Judicial review of the Agency’s Final Order is governed by SG § 10-222(h), which provides that we may: ³¹⁷ (1) remand the case for further proceedings; (2) affirm the final decision; or (3) reverse or modify the decision if any substantial right of the petitioner may have been prejudiced because a finding, conclusion, or decision: (i) is unconstitutional; (ii) exceeds the statutory authority or jurisdiction of the final decision maker; (iii) results from an unlawful procedure; (iv) is affected by any other error of law; (v) is unsupported by competent, material, and substantial evidence in light of the entire record as submitted; or (vi) is arbitrary or capricious.

The “substantial evidence” standard of review applies to agency fact-finding and application of law to facts. Consumer Prot. Div. v. Morgan, 387 Md. 125, 160 , 874 A.2d 919 (2005). “The standard for substantial evidence review is whether a reasoning mind reasonably could have reached the factual conclusion the agency reached.” Id. (citation and quotation marks omitted).

Though we review an agency’s legal conclusion de novo, “an administrative agency’s interpretation and application of the statute which the agency administers should ordinarily be given considerable weight by reviewing courts.” Christopher v. Montgomery County HHS, 381 Md. 188, 199 , 849 A.2d 46 (2004) (quoting Bd. of Physician Quality Assurance v. Banks, 354 Md. 59, 69 , 729 A.2d 376 (1999)). Accordingly, “judicial review of administrative agency action is [generally] narrow. The reviewing court must not substitute its judgment for the expertise of those persons who constitute the administrative agency.” 11 George, 383 Md. at 512 , 860 A.2d 896 (quoting Watkins v. Dept. of Public Safety ³¹⁸ and Correctional Services, 377 Md. 34, 45-46 , 831 A.2d 1079 (2003)) (internal quotation marks omitted). With few exceptions, the facts in this case are not in dispute.

Consequently, our review is focused on the Agency’s legal conclusions, its application of law to facts, and its adherence to proper procedure. Discussion Bayly Crossiny, LLC’s standiny Before responding to appellants’ contentions, we must first address the CPD’s assertion that Bayly Crossing, LLC lacks standing to pursue this appeal because it forfeited its corporate charter. Appended to CPD’s brief is a certificate from the State Department of Assessments and Taxation (“SDAT”), dated April 24, 2009, stating that Bayly Crossing, LLC’s charter was forfeited by SDAT on October 5, 2007. As of the date this opinion was filed, SDAT’s website continues to list Bayly Crossing, LLC’s corporate charter as forfeited.

Appellants’ reply brief makes no mention of the status of Bayly Crossing, LLC’s charter, and does not respond to the CPD’s assertion that it lacks standing to pursue this appeal. Consequently, we take judicial notice pursuant to Maryland Rule 5-201 that Bayly Crossing, LLC forfeited its corporate charter on October 5, 2007, and has not thus far filed articles of revival. We addressed this same issue in T.B. Passyn & Sons, where we likewise took judicial notice that T.B. Passyn & Sons, Inc. had forfeited its corporate charter, and dismissed its appeal for lack of standing. Id. at 22-27.

There we explained that “[o]nce a charter has been forfeited, the corporation immediately becomes a legal non-entity, a lifeless corpus.” Id. at 24 (citing Dual v. Lockheed Martin Corp., 383 Md. 151, 163 , 857 A.2d 1095 (2004)). We also explained “that the revival of a corporate charter d[oes] not relate back so as to permit an appeal when the notice of appeal was filed during the time that the corporate charter was forfeit.” Id. at 25 (citing Hill Construction v. Sunrise Beach, LLC, 180 Md.App. ³¹⁹ 626, 952 A.2d 357 (2008)). Thus, as in T.B. Passyn & Sons, the forfeiture of Bayly Crossing, LLC’s corporate charter and its failure to file articles of revival render its appeal a nullity. Accordingly, Bayly Crossing, LLC is dismissed as a party to this appeal for lack of standing.

Bayly Crossiny, LLC’s failure to reyister as a home builder The linchpin of this dispute is the Agency’s determination that Bayly Crossing, LLC was a “home builder” and, therefore, required to register as such under the HBRA. The HBRA defines a “home builder” as “a person that undertakes to erect or otherwise construct a new home.” HBRA § 4.5-101(f)(1). Subject to certain exceptions, “home builder[s]” must register with the HBRU. HBRA §§ 4.5-301, 4.5-303(a)(1).

The definition of “home builder” specifically excludes “a real estate developer who does not construct new homes.” HBRA § 4.5-101(f)(3)(iv). The Passyns argue that they fall within the exclusion because they merely contracted to sell new homes and did not, in their individual capacities or through Bayly Crossing, LLC, undertake to construct or erect new homes. The Passyns argue that the Agency’s conclusion that they acted as home builders under the HBRA was “based entirely upon the boilerplate phrase ‘sell and construct’ within contracts used by Bayly Crossing” and ignored the real estate developer’s exemption. The Passyns further note that T.B. Passyn & Sons, Inc., the entity that performed the actual construction, was plainly disclosed as the home builder in its contracts.

The CPD’s arguments in response mirror the rationale provided by the Agency in its Final Order. Specifically, the CPD argues that whether the Passyns or Bayly Crossing, LLC intended to perform the actual construction is irrelevant because by agreeing to “sell and construct” new homes, they “undertook the legal obligation to construct homes for consumers.” The CPD premises this argument on the assertion that “ ‘undertake,’ as used in defining a home builder, means ‘to put oneself under obligation to perform.’ ” The CPD also suggests that, irrespective of the contract language, the seller ³²⁰ of a new home must register with the HBRU. The CPD points to the requirement in Maryland Code, § 14-117(j)(2)(i), which requires the contract for an initial sale of a new home to include the “builder registration number of the seller of the new home.” Moreover, CPD argues that, if the registration requirement was determined by who performed the actual construction, there would be no need to exempt from registration lenders who hire a second registered home builder to complete the first home builder’s unfinished project. See HBRA § 4.5-501(c).

Finally, the CPD argues that the real estate developer’s exemption “was intended to cover developers who do not play a direct role in the sale of new homes to consumers.” We view the use of the term “undertake[ ]” in the definition of “home builder” as dispositive on this issue. The cardinal rule of statutory interpretation is to ascertain and effectuate the intent of the Legislature. In order to ascertain the intent of the Legislature, we begin with the plain language of the statute, and if that language is clear and unambiguous, we look no further than the text of the statute. In re Najasha B., 409 Md. 20, 27 , 972 A.2d 845 (2009) (citations and quotation marks omitted).

The definitions of “undertake” listed in Webster’s New Twentieth Century Dictionary (1968, 2nd ed.) include “to give a promise or pledge that; to contract,” “to promise; to guarantee,” and “to make oneself responsible for.” Thus, by defining a home builder as one who “undertakes to erect or otherwise construct a new home,” HBRA § 4.5-101(f)(l) (emphasis added), the legislature clearly intended to capture those who incur the obligation to build a new home, rather than just those who actually build the home. Bayly Crossing, LLC undertook the legal obligation to construct a home for the purchasers by agreeing to “sell and construct” a new home. The contractual provision in which the “SELLER”—Bayly’s Crossing, LLC—agreed to provide ³²¹ the buyer with a home substantially similar “to SELLER’S Model House” reaffirmed this obligation. The Passyns argue that the “sell and construct” language is mere “boilerplate,” and point to the fact that T.B. Passyn & Sons, Inc. is listed as the actual builder.

Under the well-settled principle of objective contract interpretation we “give effect to the clear terms of the contract regardless of what the parties to the contract may have believed those terms to mean.” Clancy v. King, 405 Md. 541, 557 , 954 A.2d 1092 (2008) (quotation marks and citation omitted). Thus, the Passyns’ subjective intent in agreeing to “sell and construct” new homes is irrelevant. According to the clear and unambiguous terms of the contract, Bayly Crossing, LLC “undertook] to erect or otherwise construct a new home” and was therefore a “home builder” under HBRA § 4.5—101(f)(1). Our conclusion is also supported by looking at the entirety of the statute and reading the definition of “home builder” in context.

As stated, “home builder” is defined in HBRA § 4.5-101(f) as “a person that undertakes to erect or otherwise construct a new home.” It includes, inter alia, “a custom home builder as defined in § 10-501 of the