Blackstone v. Sharma

Getty, J. This case is a consolidated appeal of four circuit court cases in which the parties contest the application of a 2007 departmental bill revising the Maryland Collection Agency Licensing Act ("MCALA" or "the Act"). Md. Code (1992, 2015 Rep. Vol.), Bus. Reg.

("BR") § 7-301, et seq. The overarching issue presented in these consolidated cases is whether MCALA, as revised by the 2007 departmental bill, is constrained to the original scope of collection agencies seeking consumer claims or whether the revised statutory language propels MCALA requirements across the threshold of the mortgage debt arena, requiring principal actors of Maryland's mortgage market to obtain a collection agency license. MCALA was first enacted in 1977 to protect Maryland consumers from abusive debt collection practices employed by the collection agency industry. 1977 Md. Laws, ch. 319. The Act specifically defined "collection agencies" as entities engaged in the practice of collecting consumer debts for others, excluding those entities collecting debts they owned.

Pursuant to MCALA, these third-party debt collectors were required to obtain a license as well as file a surety bond of $5,000 for the benefit of the State and any member of the public damaged by such collection agencies. BR § 7-301 ; 7-304. The State Collection Agency Licensing Board ("the Board"), 1 located within the Department of Labor, Licensing, and Regulation ("DLLR" or "Department"), is responsible for enforcing the Act. BR § 7-201.

In 2007, DLLR requested a departmental bill (House Bill 1324) to revise the definition of collection agencies required to obtain the MCALA license. Specifically, the Department submitted a bill request, explaining that the legislation would allow DLLR to regulate actors in the collection industry that employ a loophole in MCALA's licensing requirement by purchasing delinquent consumer debt for goods and services by way of a purchase contract that mirrors a collection agency agreement. When enacted, the departmental bill specifically changed MCALA's definition of "collection agencies" to include a person who engages directly or indirectly in the business of "collecting a consumer claim the person owns, if the claim was in default when the person acquired it[.]" 2007 Md. Laws, ch. 472. Each of the circuit courts below, along with the Court of Special Appeals, found that foreign statutory trusts acting as a repository for defaulted mortgage debts were required to obtain a license as a collection agency pursuant to MCALA before its substitute trustees filed a foreclosure action in the circuit court.

The substitute trustees each petitioned this Court for certiorari, asserting that the circuit courts improperly dismissed the foreclosure actions because the foreign statutory trusts do not fall under the definition of "collection agencies" that are licensed and regulated by MCALA. This Court is therefore called upon to determine the scope of MCALA. 2 Specifically, the limited legal issue in these consolidated cases is whether the General Assembly intended a foreign statutory trust, as owner of a delinquent mortgage loan, to obtain a license as a collection agency under MCALA before substitute trustees instituted a foreclosure action against a homeowner who defaulted on his or her mortgage. As explained below, the legislative history, subsequent legislation, and related statutes make clear that the 2007 departmental bill did not expand the scope of MCALA to include mortgage industry players seeking foreclosure actions; thus, this Court answers that question in the negative. 3 BACKGROUND This appeal constitutes two cases consolidated before the Court of Special Appeals as well as two additional actions appealed to this Court directly from circuit court foreclosure proceedings. In each of the cases sub judice , the respondents obtained a mortgage loan from a creditor to purchase, convey, or refinance their homes.

The loans were evidenced by a promissory note and secured by a deed of trust. Eventually, the homeowners all missed loan payments, resulting in the banks declaring the loans to be in default. At some point after the respondents defaulted on the mortgage loans, the banks transferred the loans and all beneficial interest in the deed of trust as part of a securitized pool of mortgage loans to either Ventures Trust 2013-I-H-R ("Ventures Trust") or LSF9 Master Participation Trust ("LSF9"), both of which are foreign statutory trusts organized under Delaware law. These foreign statutory trusts acted through trustees which in these cases were other banks.

A separate loan servicer was assigned to communicate with the borrowers and collect the monthly mortgage payments. The trustees subsequently appointed substitute trustees, conveying all rights and duties under the deeds of trust, including the power of sale. The substitute trustees subsequently initiated foreclosure actions to enforce the security interest against the defaulting borrowers, meaning that the substitute trustees are the petitioners in each of the cases sub judice . In response, the defaulting homeowners filed counter complaints arguing that the foreign statutory trusts acted as collection agencies as defined under MCALA when they obtained defaulted mortgage loans and then collected mortgage payments through communication and foreclosure actions without being licensed as required by MCALA.

See BR § 7-301, et seq. The counter complaints further alleged that, by attempting to collect mortgage payments without the required license under MCALA, the foreign statutory trusts violated the Maryland Consumer Debt Collection Act ("MCDCA"). Md. Code (1975, 2013 Repl. Vol.), Com.

Law ("CL") § 14-201, et seq. In addition to filing counter complaints, the borrowers in default requested that the circuit courts dismiss or enjoin the foreclosure sales. To support the request, the borrowers argued that the foreign statutory trusts brought the foreclosure action without being licensed as a collection agency, violating MCALA and MCDCA, and that any judgment obtained by an unlicensed entity acting as a collection agency would be void. See Finch v. LVNV Funding, LLC , 212 Md. App. 748 , 759, 71 A.3d 193 (2013).

In response, the substitute trustees argued that the foreign statutory trusts were neither doing business in the State nor doing business as a collection agency when they filed foreclosure actions, that MCALA did not apply to the in rem proceedings, that the foreign statutory trusts constituted trust companies exempted from the Act, and that the homeowners failed to specify a relevant defense under Maryland mortgage foreclosure law. See Md. Code Ann., Real Prop. ("RP") § 7-101, et seq. ; Md. Rules 14-201, et seq. ; Md. Code Regs. 09 .03.12.01, et seq. The circuit courts all held motions hearings to consider the various arguments regarding MCALA.

In each of the cases sub judice , the circuit courts issued an order dismissing the foreclosure proceeding without prejudice after finding that the foreign statutory trusts were in the business of collecting consumer debt because the entities indirectly attempted to collect on a defaulted mortgage loan purchased at a discount. The courts also determined that the foreign statutory trusts did not fall under the trust company exemption to MCALA. After determining that the foreign statutory trusts were subject to the MCALA licensing requirements, the circuit courts noted that there was no dispute that Ventures Trust and LSF9 lacked the required collection agency license. As such, the circuit courts concluded that foreign statutory trusts had no right to bring the foreclosure actions, dismissing each of the cases without prejudice.

We will summarize the factual background of each of the individual cases in turn below. A. Kyle Blackstone, et al. v. Dinesh Sharma, et al. ; Terrance Shanahan, et al. v. Seyed Marvastian, et al. i. Kyle Blackstone, et al. v. Dinesh Sharma, et al. In 2006, Ruchi Sharma owned a home located at 10302 Oaklyn Drive, Potomac, Maryland, which she wished to sell to her parents, Mr. Dinesh Sharma and Mrs. Santosh Sharma. In order to finance the home purchase, Dinesh and Santosh Sharma sought to obtain a loan in the amount of $1,920,000.00 from Washington Mutual Bank, FA ("WMB").

The loan was evidenced by a promissory note and secured by a deed of trust. WMB asked Ms. Ruchi Sharma, who accompanied Dinesh and Santosh to the bank, to sign the deed of trust because the conveyance was not an arm's length transaction. Therefore, Rushi Sharma, Dinesh Sharma, and Santosh Sharma ("the Sharmas") all signed the closing documents, including the deed of trust. 4 On December 2, 2007, WMB declared the Sharmas to be in default on the promissory note. A little less than six years later, Ventures Trust acquired the Sharmas' loan and all beneficial interest in the deed of trust as part of a securitized pool of mortgage loans.

Ventures Trust acted through its trustee, MCM Capital Partners, LLC ("MCM"). In 2014, Ventures Trust, through MCM, appointed substitute trustees, Kyle Blackstone, William O'Neil, and Terrance Shanahan. On November 25, 2014, the substitute trustees initiated a foreclosure action in the Circuit Court for Montgomery County to enforce the security interest in the Sharmas' real property. In response, the Sharmas filed a counter complaint against the substitute trustees as well as MCM, as trustee for Ventures Trust.

The counter complaint alleged that Ventures Trust acted as a collection agency as defined under MCALA when it purchased the defaulted mortgage loan without being licensed. See BR § 7-301, et seq. The counter complaint 5 further alleged that by attempting to collect mortgage payments from the Sharmas without the required license under MCALA, Ventures Trust violated the MCDCA. CL § 14-201, et seq.

In addition to the counter complaint, the Sharmas filed a motion to dismiss or enjoin the foreclosure sale pursuant to Md. Rule 14-211. In their motion, the Sharmas contended that any responsive legal claim in a foreclosure proceeding should be heard and decided before the equitable claims. As to the legal issue, the Sharmas argued that the circuit court should dismiss or stay the foreclosure action primarily because Ventures Trust brought the foreclosure action without being licensed as a collection agency. As such, the Sharmas contended that Ventures Trust violated MCALA and MCDCA.

The Sharmas further asserted in their motion that Ventures Trust could not obtain relief because of a ruling by the Court of Special Appeals, which held that a judgment obtained by an unlicensed entity acting as a collection agency is void. See Finch , 212 Md. App. at 759 , 71 A.3d 193 . The substitute trustees filed an opposition to the homeowners' motion on behalf of Ventures Trust. In the opposition, the substitute trustees contended that the Sharmas failed to specify a relevant defense, such as a violation of the Maryland Rules or Maryland mortgage foreclosure laws.

In addition, Ventures Trust's substitute trustees argued that Ventures Trust falls within the trust companies exemption to MCALA and, as such, is not subject to the licensing requirements under MCALA. Based on this argument, Ventures Trust maintained that it was entitled to bring the foreclosure action without first having to obtain a MCALA license. 6 The Circuit Court for Montgomery County held a motions hearing, during which the presiding judge heard arguments on the Sharmas' motion and Venture Trust's opposition thereto. On August 28, 2015, the circuit court issued an order, granting the Sharmas' motion and dismissing the foreclosure proceeding without prejudice. In a corresponding opinion, the circuit court reasoned that the legislature specifically and explicitly referred to foreign statutory trusts in certain sections of the Maryland Code but decided not to list foreign statutory trusts as an excepted entity from the MCALA requirements.

Therefore, the circuit court found that the legislature intentionally omitted the term foreign statutory trusts from the MCALA sections of the Maryland Code. Moreover, the circuit court found that Ventures Trust failed to provide any convincing evidence that they constituted a trust company, which is one type of entity specifically exempted from MCALA. After determining that Ventures Trust was subject to the MCALA licensing requirements, the circuit court also noted that there was no dispute that Ventures Trust lacked the required MCALA license. As such, the circuit court concluded that the Sharmas established that Ventures Trust had no right to bring the foreclosure action, dismissing the case without prejudice. ii.

Terrance Shanahan, et al. v. Seyed Marvastian, et al. On or about June 23, 2006, Seyed Marvastian ("Mr. Marvastian") obtained a loan in the amount of $1,396,500.00 from Premier Mortgage Funding, Inc. to purchase a home located at 7809 Bradley Blvd., Bethesda, Maryland. The loan was evidenced by a promissory note and secured by a deed of trust. Mr. Marvastian's wife, Mrs. Sima Marvastian, was listed as the record owner of the real property. In 2012, Mr. Marvastian defaulted on the loan after he failed to make payments.

Two years after Mr. Marvastian's loan was declared in default, Ventures Trust acquired the mortgage loan and all beneficial interest in the deed of trust as part of a securitized pool of mortgage loans. Several months later, the substitute trustees initiated a foreclosure action in the Circuit Court for Montgomery County to enforce the security interest in the real property. Mr. and Mrs. Marvastian ("the Marvasistans") timely requested foreclosure mediation, which concluded without agreement. The Marvastians filed a counter complaint against one of the substitute trustees, Terrance Shanahan, as well as MCM, as trustee for Ventures Trust.

The counter complaint alleged that Ventures Trust acted as a collection agency as defined under MCALA when it brought a foreclosure action on the defaulted mortgage loan that Ventures Trust had purchased without the required license. BR § 7-301, et seq. The counter complaint 7 further alleged that by attempting to collect mortgage payments from Mr. Marvastian without the required license under MCALA, Ventures Trust violated MCDCA. CL § 14-201, et seq.

Along with the counter complaint, the Marvastians filed a Rule 14-211 motion to dismiss and/or stay the foreclosure proceeding pending resolution of legal questions. In their motion, the Marvastians argued that the court should stay the foreclosure proceedings in order to first resolve the legal issues presented in the counter complaint. The Marvastians further argued that any court judgment in favor of Ventures Trust would be rendered void because the entity is not licensed as a collection agency as required by MCALA. The substitute trustee and MCM, as trustee for Ventures Trust, filed an opposition to the homeowners' Rule 14-211 motion to dismiss and/or stay foreclosure proceedings.

In their opposition, the substitute trustees argued that adjudicating the counter complaint will not have any effect on the foreclosure action because Ventures Trust is exempt from the licensing requirements under MCALA. The substitute trustees further contended that the Marvastians failed to specify any viable defenses to the foreclosure. In addition, the opposition asserted that the Marvastians' motion was frivolous with the only purpose of delaying the foreclosure. The circuit court held a motions hearing on March 26, 2015. 8 After hearing arguments from both parties on the Rule 14-211 motion, the Court issued an order dated May 12, 2015, making findings of fact and conclusions of law.

Specifically, the order found that "Ventures Trust did business as a 'collection' agency in Maryland by seeking to collect [Mr. Marvastian's] mortgage debts that it purchased after default through a loan servicer." As such, the order concluded that "Ventures Trust is [ ] subject to MCALA's licensing requirements for collection agencies" and "none of the Maryland Code's definitions of 'trust company' includes Delaware Statutory Trusts[.]" Ultimately, the circuit court dismissed the foreclosure action without prejudice after concluding that the Marvastians established that Ventures Trust had no right to file the foreclose action. After the circuit court issued the order, the trustee and substitute trustee filed a motion to alter or amend judgment pursuant to Md. Rule 2-534. Through its trustees, Ventures Trust argued that the circuit court erred in concluding that MCALA applies to foreclosure proceedings and statutory foreign trusts mainly because of the potential conflict between Maryland registration requirements for statutory trusts, Md. Code Ann., Corps. & Ass'ns ("CA") § 12-902(a), and MCALA, BR § 7-301(a). The Marvastians' filed a reply, contending that the circuit court properly concluded that a foreclosure proceeding is a form of debt collection and that Ventures Trust does not fall under the MCALA exemption for trust companies.

On July 22, 2015, the circuit court held a second motions hearing in order to hear arguments on the motion to alter the court's judgment and any opposition thereto. After the second motions hearing, the circuit court issued another order, finding that there is "a clear legislative intent to subject foreign statutory trusts that collect debts in Maryland by bringing foreclosure actions in Maryland courts to MCALA's licensing requirement[.]" The circuit court also found that "MCALA's licensing requirement, Bus. Reg. § 7-301(a), and the registration requirement of CA § 12-902(a) serve distinct purposes; thus, it is not incongruous for the legislature to subject foreign statutory trusts that bring foreclosure action in Maryland to the former but to exempt them from the latter." As such, the circuit court denied Venture Trust's motion to alter or amend the judgment. iii. Consolidation and Court of Special Appeals On September 10, 2015, Ventures Trust, through its trustees and substitute trustees, filed a notice of appeal to the Court of Special Appeals in both cases, i.e. , the foreclosure actions against the properties owned by the Sharmas and the Marvastians.

The Court of Special Appeals consolidated the two foreclosure cases into one appeal and issued a reported opinion on June 6, 2017. 9 Blackstone v. Sharma , 233 Md. App. 58 , 61, 161 A.3d 718 , cert. granted , 456 Md. 53 , 170 A.3d 290 (2017). The consolidated appeal involved two questions: (1) whether a party who authorized a trustee to initiate a foreclosure action needs to be licensed as a collection agency under MCALA; and (2) whether the MCALA licensing requirement applies to foreign statutory trusts, such as Ventures Trust. The Court of Special Appeals held that Ventures Trust, as a foreign statutory trust, must meet the licensing requirements under MCALA before bringing a foreclosure action unless some other exception in MCALA applies. The Court of Special Appeals further concluded that the exception for trust companies under MCALA does not apply to Ventures Trust because it does not act as a trustee or operate as a commercial bank under the Black's Law Dictionary 10th ed. 2014 definitions.

See BR § 7-102. As such, the Court of Special Appeals ultimately held that Ventures Trust was barred from bringing the foreclosure action without the MCALA license, affirming the judgment of the Circuit Court for Montgomery County. Ventures Trust, through its substitute trustees, filed a petition for writ of certiorari to this Court on July 14, 2017. B. Laura O'Sullivan, et al. v. Jeffrey Altenburg, et al. On or about March 30, 2007, Jeffrey and Brenda Altenburg ("the Altenburgs") obtained a loan in the amount of $592,250.00 from Bank of America, N.A.

("Bank of America") to refinance their home located at 11810 Tridelphia Road, Ellicott City, Maryland. The loan was evidenced by a promissory note and secured by a deed of trust. The Alternburgs defaulted on the loan by failing to make a loan payment in 2011. Four years later, Bank of America assigned all beneficial interest under the promissory note and deed of trust to U.S. Bank Trust, as trustee for LSF9.

In 2016, U.S. Bank Trust appointed substitute trustees, Laura H.G. O'Sullivan, Erin M. Shaffer, Chasity Brown, Lauren Bush, and Rachel Kiefer. The substitute trustees subsequently initiated a foreclosure action in the Circuit Court for Howard County to enforce the security interest in the real property. The Altenburgs filed a motion to dismiss the foreclosure action pursuant to Md. Rule 14-211. 10 In their motion to dismiss, the Altenburgs argued that LSF9 did not have any legal right to pursue the foreclosure action because the entity lacked the required MCALA license. Moreover, the Altenburgs contended that any judgment in favor of LSF9, acting as an unlicensed debt collector, would be void.

See Finch , 212 Md. App. at 759 , 71 A.3d 193 . The Altenburgs also asserted that LSF9 does not constitute a trust company, which is one entity exempted from the MCALA licensing requirement. In response, the substitute trustees filed an opposition to the motion to dismiss, arguing that MCALA does not apply to in rem proceedings in which substitute trustees pursue the right to foreclose on real property pursuant to a deed of trust. The substitute trustees further asserted that LSF9 constitutes a trust company, which is specifically exempted from MCALA, because a foreign statutory trust could easily fit within the broad, undefined phrase.

The circuit court held a hearing on the Altenburgs' motion to dismiss and opposition thereto. During the motions hearing, the parties argued as to whether certain facts should be stipulated. As a result, the circuit court scheduled a second motions hearing at a later date to allow the parties time to either stipulate to certain facts or to file discovery requests. On July 13, 2016, the parties filed a pleading, stipulating to the fact that LSF9 "acquired the Promissory Note ('Note') secured by the Deed of Trust that is the subject to this action for a sum less than the total amount remaining due on the Note on the date on which LSF9 acquired the Note." The circuit court held a second motions hearing, during which the court heard additional arguments on the motion to dismiss the foreclosure action.

At the end of the second motions hearing, the circuit court made oral findings of fact and conclusions of law on the record. The court specifically concluded that the instant action constituted a consumer claim and that LSF9 required a license under MCALA before bringing the foreclosure action. As such, the circuit court further found that LSF9 did not have the ability to bring the foreclosure action because the foreign statutory trust did not have a license under MCALA at the time it initiated the action. For those reasons, the court granted the Altenburgs' motion to dismiss.

The circuit court entered an order dated August 25, 2016, dismissing the action without prejudice. The substitute trustees filed a timely notice of appeal to the Court of Special Appeals. Before the Court of Special Appeals could hear oral arguments, however, the intermediate appellate court issued its reported opinion in Blackstone v. Sharma , 233 Md. App. 58 , 61, 161 A.3d 718 , cert. granted , 456 Md. 53 , 170 A.3d 290 (2017). As such, the substitute trustees filed a petition for writ of certiorari with this Court on August 4, 2017.

C. Martin Goldberg, et al. v. Martha Neviaser, et al. On or about October 2, 2007, Marvin and Martha Neviaser ("the Neviasers") obtained a loan in the amount of $171,000.00 from Countrywide Bank, FSB, to refinance their home located at 18103 Maze Lane, Knoxville, Maryland. The loan was evidenced by a promissory note and secured by a deed of trust. The Neviasers defaulted on the loan in 2009 when they failed to make a loan payment. Six years later, Bank of America, as successor by merger to Countrywide Bank, FSB, transferred all interest in the Neviasers' loan to LSF9.

In 2015, LSF9 assigned the deed of trust to U.S. Bank Trust, as trustee for LSF9. The trustee, in turn, appointed substitute trustees, Martin S. Goldberg, Doreen A. Strothman, Virginia S. Inzer, William K. Smart, and Taryn L. Alvey. The substitute trustees subsequently initiated a foreclosure action in the Circuit Court for Washington County to enforce the security interest in the real property. 11 On November 8, 2016, the Neviasers filed a motion to dismiss the foreclosure case. 12 The Neviasers argued that LSF9 was required to have a license under MCALA before initiating the foreclosure action because they acquired a debt in default and then attempted to collect on that debt through foreclosure. Moreover, the Neviasers contended that LSF9 is not exempt from MCALA under the trust company exception because it is not an incorporated entity engaged in banking.

In addition to these arguments, the Neviasers urged the circuit court to conclude that LSF9 is estopped from obtaining a different result in the present action than the judgment by the Circuit Court for Howard County in the Alternburgs' case, discussed supra . In response, the substitute trustees filed an opposition to the motion to dismiss the foreclosure case, making four arguments: (1) LSF9 was not doing business in the State as defined under MCALA when it brought the foreclosure action; (2) LSF9 was not engaging in the business of a collection agency; (3) LSF9 fell under MCALA's trust company exemption; and (4) the rule of lenity required that any ambiguity in the coverage of MCALA favors a ruling for LSF9 because the act contains criminal penalties. The court held a motions hearing, at which time the judge heard arguments from the Neviasers and the substitute trustees as to whether the foreclosure proceeding should be dismissed. After the hearing, the court held the matter sub curia .

By memorandum order, the circuit court concluded that the foreclosure proceedings constituted consumer claims under MCALA. Moreover, the court determined that LSF9 was in the business of collecting consumer claims because the entity indirectly attempted to collect on a defaulted mortgage that it purchased at a discount. The court also rejected LSF9's argument that the trust company exemption under MCALA applied or that the rule of lenity resolved any ambiguities in LSF9's favor. Ultimately, the court granted the Neviasers' motion and dismissed the case without prejudice.

The substitute trustees filed a timely notice of appeal to the Court of Special Appeals. Before the Court of Special Appeals could hear oral arguments, however, the intermediate appellate court issued its reported opinion in Blackstone v. Sharma , 233 Md. App. 58 , 61, 161 A.3d 718 , cert. granted , 456 Md. 53 , 170 A.3d 290 (2017). As such, the substitute trustees filed a petition for writ of certiorari with this Court on August 4, 2017. D. Court of Appeals of Maryland On September 12, 2017, this Court granted certiorari in each of the above cases.

Blackstone v. Sharma , 456 Md. 53 , 170 A.3d 290 (2017) ; 13 O'Sullivan v. Altenburg , 456 Md. 56 , 170 A.3d 291 (2017) ; Goldberg v. Neviaser , 456 Md. 54 , 170 A.3d 290 (2017). This Court accepted separate briefs in each of the appeals. 14 Moreover, this Court scheduled individual oral arguments for each of the three cases. The parties presented six questions for our review, which we have rephrased as follows: 1. Whether a foreign statutory trust seeking a mortgage foreclosure action, which is a purely in rem proceeding against the subject real property, constitutes a "consumer claim" for "money owed" under MCALA? 2.

Whether a foreign statutory trust filing a mortgage foreclosure action, which by statute is not "doing business in this State," nevertheless is "doing business as a collection agency in the State" under MCALA? 3. Whether the Court of Special Appeals' previous ruling in Finch v. LVNV Funding, LLC , 212 Md. App. 748 , 759, 71 A.3d 193 (2013) - i.e. , that a judgment in favor of an unlicensed debt collection agency is void as opposed to voidable - should apply to mortgage foreclosure judgments? 4. Whether the circuit court can dismiss a foreclosure action because a foreign statutory trust lacks a collection agency license under MCALA, despite established Maryland authority holding that entities, such as a trustee of the trust and its duly appointed substitute trustees, may enforce a promissory note indorsed in blank in their possession, regardless of who owns the debt or the foreign statutory trust's legal status? 5. Whether a foreign statutory trust pursuing a foreclosure is "doing business as a collection agency" in Maryland under MCALA? 6.

Whether a foreign statutory trust that owns mortgage assets falls within MCALA's "trust company" exemption? Questions 1, 2, 4, and 5 above require this Court to first answer one question: Did the Maryland General Assembly intend to require foreign statutory trusts, one of the entities in the mortgage industry, to obtain a collection agency license pursuant to MCALA before pursuing an in rem foreclosure proceeding? This is the ultimate question before this Court. By answering this question in the negative, this Court does not need to reach questions 3 and 6, both of which are questions that inherently and incorrectly assume that the MCALA licensing requirement applies to foreign statutory trusts like Ventures Trust and LSF9.

STANDARD OF REVIEW Generally, the "standard of review of the grant or denial of a motion to dismiss is whether the trial court was legally correct." Davis v. Frostburg Facility Operations, LLC , 457 Md. 275 , 284, 177 A.3d 709 (2018) (citing RRC Ne., LLC v. BAA Maryland, Inc. , 413 Md. 638 , 643-44, 994 A.2d 430 (2010) ). Specific to foreclosure actions, Md. Rule 14-211 states that the borrower "may file in the action a motion to stay the sale of the property and dismiss the foreclosure action." Md. Rule 14-211(a). In addition, the rule instructs circuit courts how to make a final determination: After the hearing on the merits, if the court finds that the moving party has established that the lien or the lien instrument is invalid or that the plaintiff has no right to foreclose in the pending action, it shall grant the motion and, unless it finds good cause to the contrary, dismiss the foreclosure action. If the court finds otherwise, it shall deny the motion.

Md. Rule 14-211(e) (emphasis added). In each of the cases below, the circuit courts concluded that the substitute trustees were unable to bring the foreclosure action on behalf of the foreign statutory trust because the trust did not have a collection agency license under MCALA. To that end, the circuit courts determined that the foreign statutory trusts were engaged in the business of a collection agency by acquiring a mortgage loan in default and then having substitute trustees pursue a foreclosure action to collect that mortgage debt. The circuit courts subsequently granted each of the mortgagor's motions, dismissing the foreclosure proceedings.

As these determinations constitute issues of law, this Court will review the circuit courts' decisions to grant the various motions to dismiss de novo . See e.g. , Anderson v. Burson , 424 Md. 232 , 243, 35 A.3d 452 (2011) ; Williams v. Peninsula Reg'l Med. Ctr. , 440 Md. 573 , 578, 103 A.3d 658 (2014). In our review, we will "accept all well-pled facts in the complaint, and reasonable inferences drawn from them, in a light most favorable to the non-moving party[.]" Sprenger v. Pub.

Serv. Comm'n of Maryland , 400 Md. 1 , 21, 926 A.2d 238 (2007) (quoting Converge Servs. Grp., LLC v. Curran , 383 Md. 462 , 475, 860 A.2d 871 (2004) ). DISCUSSION The main dispute between the parties in this case involves the proper interpretation of MCALA as revised by the 2007 departmental bill.

The petitioners in these consolidated cases, the substitute trustees of the foreign statutory trusts, each make slightly nuanced arguments as to why the foreign statutory trusts did not need to obtain a license under MCALA before the substitute trustees filed foreclosure proceedings on the trusts' behalf. Specifically, the substitute trustees of Ventures Trust, the foreign statutory trust that owned the mortgage loans obtained by the Sharmas and the Marvastians, contend that entities do not need an MCALA license when pursuing an in rem foreclosure action because such a proceeding is brought against the property rather than for money owed on a consumer debt. In addition, Ventures Trust's substitute trustees assert that requiring a foreign statutory trust foreclosing on a mortgage to obtain a license under MCALA for "doing business" as a collection agency would conflict with the Corporations & Associations Article of the Maryland Code, which states that foreign statutory trusts are not doing business in the State by foreclosing mortgages and deeds of trust. See CA § 12-908(a)(5).

The substitute trustees of Ventures Trust finally argue that requiring foreign statutory trusts to obtain a license under MCALA will not ultimately protect consumers because foreign statutory trusts do not have employees or offices; instead, the trusts act only through trustees and substitute trustees. See Deutsche Bank Nat. Tr. Co. v. Brock , 430 Md. 714 , 718, 63 A.3d 40 (2013).

Substitute trustees of LSF9, holder of the Altenburgs' and Neviaser's mortgage loans, make slightly different arguments before this Court. First, LSF9 substitute trustees contend that the entities that either need to be licensed or exempted pursuant to MCALA are the trustees (who appoint the substitute trustees), the substitute trustees (who pursue the foreclosure proceeding), and the mortgage loan servicer (who contacts the debtor). To that end, the substitute trustees for LSF9 argues that the licensure of the foreign statutory trust (a repository that owns the mortgage loans) is irrelevant because these entities do not act or conduct any business. The substitute trustees further assert that "doing business" is a legal term of art that can be interpreted by looking to the phrase's definition found within other articles of the Maryland Code.

Furthermore, the substitute trustees argue that foreclosure proceedings are not consumer claims as defined under MCALA and that statutory trusts are not engaging in the business of debt collection by having substitute trustees pursue a foreclosure action. The LSF9 substitute trustees also urge this Court to interpret MCALA's exemption for trust companies to include foreign statutory trusts. In response, the defaulting homeowners argue that the plain language of MCALA unambiguously requires any person or entity that collects a consumer claim, if the claim was in default when the party acquired it, to have a collection agency license. Specifically, the respondents contend that the legislature could have intentionally added an exemption for foreign statutory trusts under MCALA, but chose not to do so.

In undertaking the statutory interpretation, the borrowers in default assert that other statutes are not relevant to this Court's analysis. Moreover, the respondents argue that the petitioners have conceded that a foreign statutory trust is simply an account, requiring a finding by this Court that such an account cannot fall under the exemption for trust companies. The defaulting homeowners also urge this Court to apply Maryland's longstanding principle that unlicensed persons will not be given the assistance of the courts when the person has not obtained a license for conducting certain business required by statute. As becomes clear by the parties' various arguments, this Court must conduct a statutory interpretation analysis.

"This Court provides judicial deference to the policy decisions enacted into law by the General Assembly. We assume that the legislature's intent is expressed in the statutory language and thus our statutory interpretation focuses primarily on the language of the statute to determine the purpose and intent of the General Assembly." Phillips v. State , 451 Md. 180 , 196, 152 A.3d 712 (2017). When conducting a statutory construction analysis, we begin "with the plain language of the statute, and ordinary, popular understanding of the English language dictates interpretation of its terminology." Schreyer v. Chaplain , 416 Md. 94 , 101, 5 A.3d 1054 (2010) (quoting Adventist Health Care Inc. v. Maryland Health Care Comm'n , 392 Md. 103 , 124 n. 13, 896 A.2d 320 (2006) ). When the "words of a statute are ambiguous and subject to more than one reasonable interpretation, or where the words are clear and unambiguous when viewed in isolation, but become ambiguous when read as part of a larger statutory scheme, a court must resolve the ambiguity by searching for legislative intent in other indicia[.]" State v. Bey , 452 Md. 255 , 266, 156 A.3d 873 (2017).

Moreover, after determining a statute is ambiguous, "we consider the common meaning and effect of statutory language in light of the objectives and purpose of the statute and Legislative intent." Stachowski v. Sysco Food Servs. of Baltimore, Inc. , 402 Md. 506 , 517, 937 A.2d 195 (2007). Even in instances "when the language is unambiguous, it is useful to review legislative history of the statute to confirm that interpretation and to eliminate another version of legislative intent alleged to be latent in the language." State v. Roshchin , 446 Md. 128 , 140, 130 A.3d 453 (2016). See also Shealer v. Straka , 459 Md. 68 , 83-85, 184 A.3d 391 (2018). In addition to legislative history, "[w]e may and often must consider other 'external manifestations' or 'persuasive evidence," in order to ascertain the legislative purpose behind a statute.

Kaczorowski v. Mayor & City Council of Baltimore , 309 Md. 505 , 515, 525 A.2d 628 (1987). Specifically, this Court should consider the context of the bill, including the title and function paragraphs, the amendments to the legislation, as well as the "bill request form[.]" Id. This Court may also analyze the statute's "relationship to earlier and subsequent legislation, and other material that fairly bears on the fundamental issue of legislative purpose or goal, which becomes the context within which we read the particular language before us in a given case." Id. In the event the language of a statute is ambiguous, we will often apply rules of statutory construction to ascertain the intent of the legislature.

One such rule is to read the language of a statute in such a way that "will carry out its object and purpose." Harbor Island Marina, Inc. v. Bd. of Cty. Comm'rs of Calvert Cty., Md. , 286 Md. 303 , 311, 407 A.2d 738 (1979). This Court will also "consider the consequences resulting from one meaning rather than another, and adopt that construction which avoids an illogical or unreasonable result, or one which is inconsistent with common sense." Spangler v. McQuitty , 449 Md. 33 , 50, 141 A.3d 156 (2016) (quoting Rosemann v. Salsbury, Clements, Bekman, Marder & Adkins, LLC , 412 Md. 308 , 315, 987 A.2d 48 (2010) ). In this case, therefore, we must determine if the General Assembly intended to require foreign statutory trusts, such as Ventures Trust and LSF9, to obtain a collection agency license under MCALA before substitute trustees file a foreclosure action on the trust's behalf.

A. Plain Language Pursuant to our longstanding statutory interpretation case law, we will first analyze the plain language of the statute in discerning the issue before this Court. MCALA generally requires that "a person must have a license whenever the person does business as a collection agency in the State." BR § 7-301(a). The Act defines collection agency as follows: (d) "Collection agency" means a person who engages directly or indirectly in the business of: (1)(i) collecting for, or soliciting from another, a consumer claim; or (ii) collecting a consumer claim the person owns, if the claim was in default when the person acquired it; (2) collecting a consumer claim the person owns, using a name or other artifice that indicates that another party is attempting to collect the consumer claim; (3) giving, selling, attempting to give or sell to another, or using, for collection of a consumer claim, a series or system of forms or letters that indicates directly or indirectly that a person other than the owner is asserting the consumer claim; or (4) employing the services of an individual or business to solicit or sell a collection system to be used for collection of a consumer claim. BR § 7-101(d).

Under MCALA, a consumer claim is defined as a claim "for money owed or said to be owed by a resident of the State" and "arises from a transaction in which, for a family, household, or personal purpose, the resident sought or got credit, money, personal property, real property or services." BR § 7-101(f). The key provisions of MCALA require a person to have a license "whenever the person does business as a collection agency[.]" BR § 7-301(a). Perhaps most significant to the instant appeal is the new language from the 2007 departmental bill that includes an entity that "engages directly or indirectly in the business of ... collecting a consumer claim the person owns, if the claim was in default when the person acquired it" to the definition of collection agency. BR § 7-101(d).

The General Assembly also limited the scope of MCALA by listing entities exempted from the statute all together. See BR § 7-102(b). Specifically, the statute "does not apply to" many of the mortgage industry actors, including "(1) a bank; (2) a federal or State credit union; (3) a mortgage lender; ... (5) a licensed real estate broker, or an individual acting on behalf of the real estate broker, in the collection of rent or allied charge for property; (6) a savings and loan association; (7) a title company as to its escrow business; (8) a trust company; [and] (9) a lawyer ...." Id.

However, the statute does not define any of the exempted entities. On the one hand, this Court cannot ignore that the term "collection agency" is commonly understood as those entities with a business model of sending letters to debtors, making collection calls, and filing collection suits for consumer debt. See Alexander Gordon, IV, FEDERAL INTERVENTION IN THE MORTGAGE MARKETS , Maryland State Bar Association Inc., GOMF MD-CLE 1707 (2004) ("traditional debt collection activities (sending dunning letters, making collection calls to consumers)"); Finch v. LVNV Funding, LLC , 212 Md. App. 748 , 752, 71 A.3d 193 (2013) (involving a collection agency named LVNV Funding, LLC that brought collection suits against consumers who accumulated credit card debt in district court without first obtaining a license under MCALA). This ordinary meaning of collection agencies aligns with a majority of the collection agency definition under MCALA.

See BR § 7-101(d)(1)(ii); (2)-(4) (defining collection agencies as those engaged directly or in directly in the business of: collecting for, or soliciting from another, a consumer claim; collecting a consumer claim the person owns, using a name or other artifice that indicates that another party is attempting to collect the consumer claim; giving or using, for collection of a consumer claim, a series or system of forms or letters that indicates that a person other than the owner is asserting the consumer claim; and employing the services of an individual or business to solicit or sell a collection system to be used for collection of a consumer claim). On the other hand, however, this commonly understood meaning does not necessarily comport with the prong of MCALA's definition of collection agencies added by the 2007 departmental bill: "a person who engages directly or indirectly in the business of ... collecting a consumer claim the person owns, if the claim was in default when the person acquired it[.]" BR § 7-101(d)(1)(ii). Reading this language alone, it is unclear whether the General Assembly intended to move away from the ordinary meaning of collection agencies. Moreover, the statutory language excerpted above is undoubtedly capable of more than one reasonable interpretation.

See Barbre v. Pope , 402 Md. 157 , 173, 935 A.2d 699 (2007). This language, especially when considering that it includes entities that act "indirectly," could mean that any individual who obtains a single defaulted debt and pursues one lawsuit or contacts the debtor once to collect that debt engages in the business of a collection agency and is required to obtain a license before doing so. BR § 7-101(d). In the alternative, the language added by the 2007 departmental bill could signify that the General Assembly intended to license those businesses that are commonly understood to be collection agencies that were also buying defaulted consumer debt.

In addition to the conflict between the common understanding of collection agencies and the language added by the 2007 departmental bill, MCALA also includes the phrase "engages directly or indirectly in the business of[.]" BR § 7-101(d). The Court of Special Appeals has previously recognized the ambiguity of this phrase in Old Republic Ins. Co. v. Gordon , 228 Md. App. 1 , 17, 137 A.3d 237 (2016). In Gordon , the intermediate appellate court analyzed whether an insurance company pursuing a subrogation right constitutes doing business as a collection agency, requiring the company to obtain a license under MCALA.

Id. at 2, 13 , 137 A.3d 237 . Specifically, the Court of Special Appeals examined the phrase "in the business of," noting the "dearth of authority in Maryland addressing the meaning of the phrase[.]" Id. After evaluating the "different interpretations of the phrase 'in the business of,' " the Court of Special Appeals concluded "that the language of the statute is ambiguous in the context of the issue presented here." Id. at 18 , 137 A.3d 237 . The Court of Special Appeals was correct that this Court has never explicitly opined on the meaning of the phrase "in the business of" let alone the more specific MCALA phrase "engages directly or indirectly in the business of[.]" BR § 7-101(d).

However, we have previously analyzed the meaning of the word "business." In Zurich Insur. Co. v. Friedlander , this Court specifically analyzed the meaning of "business" as used in an exclusionary clause. 261 Md. 612 , 616-17, 276 A.2d 658 (1971). This Court opined: The ordinary and customary meaning is that reflected in Webster's Third New International Dictionary as 'commercial or mercantile activity customarily engaged in as a means of livelihood' or two definitions given by Funk and Wagnall's New Standard Dictionary of the English Language: '1. A pursuit or occupation that employs or requires energy, time or thought; trade, profession, calling. 2.

Any occupation connected with the operations and details of trade or industry, ' Id. (Emphasis added). We then confirmed that the "Funk and Wagnall's definition of business ... has been used by various courts as a test of whether one was or was not engaged in a business." Id. at 617 , 276 A.2d 658 . Applying that definition of "business" as used in MCALA to the consolidated cases before us presents further ambiguity.

Specifically, the foreign statutory trusts that own the mortgage loans in the cases sub judice do not have any employees or offices, do not have any registered agent, and do not have any specifically identified pursuit in the State of Maryland. Instead, LSF9 and Ventures Trust both act solely through trustees and substitute trustees. Therefore, it would be hard for this Court in the first instance to conclude that the foreign statutory trusts engage, either directly or indirectly, in the business of a collection agency when it is hard to deduce if these entities are even conducting "business" under Funk and Wagnall's definition. 15 The defaulting homeowners contend that MCALA's definition of consumer claim is unambiguous and resolves the issue before this Court. 16 Specifically, MCALA defines consumer claim to include a claim that "is for money owed or said to be owed" and "arises from a transaction in which ... the resident sought or got ... real property [.]" BR § 7-101(f) (emphasis added). Though the borrowers may be correct that certain real property transactions or other consumer loans involving property fall within this definition, that is not the crucial question presented in this appeal.

This Court must instead determine whether the General Assembly intended to license certain actors in the mortgage industry, such as foreign statutory trusts, as opposed to solely those actors in the collection agency industry. Just as the Court of Special Appeals determined in Gordon , this Court concludes that the plain language of MCALA is ambiguous "in the context of" whether a foreign statutory trust that owns a defaulted mortgage debt falls under the scope of MCALA when a substitute trustee brings a foreclosure action on the trust's behalf. 17 Id. We cannot determine from the plain language alone if the legislature intended the MCALA licensing requirement to apply to a foreign statutory trust that obtained a defaulted mortgage loan, after which a substitute trustee filed a foreclosure action to protect the trust's security interest. This Court will, therefore, consider the legislative history, subsequent legislation, and related statutes in order to discern the intent of the General Assembly when it enacted the original MCALA statute and any pertinent revisions.

See Kaczorowski , 309 Md. at 515 , 525 A.2d 628 . B. Legislative History In 1977, the General Assembly enacted the first collection agency licensing statute, which generally instructed that a "person may not engage in the business of a collection agency in this State without an annual license[.]" 1977 Md. Laws, ch. 319. The statute also created the Collection Agency Licensing Board responsible for licensing collection agencies and enforcing the Maryland Consumer Debt Collection Act. 1977 Md. Laws, ch. 319. Senate Bill 435 of 1977 specifically defined "Collection Agency" as: all persons directly or indirectly engaged in the business of soliciting from, or collecting for others any claim due or asserted to be owed or due, to a seller, lender, holder, or creditor, arising from transactions involving a Maryland resident seeking or acquiring real or personal property, services, money, or credit for personal, family, or household purposes.

Id. The original legislation further clarified that a " 'Collection Agency' includes any person who gives away, sells, or attempts to give away or sell to others, any system or series of letters or forms used in the collection of claims which assert or indicate, directly or indirectly, that the claim is being asserted or collected by any person other than the creditor or owner of the claim." Id. The 1977 collection agencies licensing statute indicated that: (2) "Collection Agency" does not include any: (I) Regular employee of a creditor acting under the general direction and control of that creditor in the collection of a claim owned by that creditor; (II) Regular employee of a collection agency licensed under this subtitle; (III) Bank, trust company, savings and loan association, or building and loan association or mortgage banker ; (IV) Abstract company doing an escrow business; (V) Attorney at law; or (VI) Any person acting under the order of any court of competent jurisdiction. Id.

(Emphasis added). The language of the initial collection agency licensing statute conveys that the General Assembly originally intended only to require licensure for third party collection agencies that collect or solicit the debt of others or sells a system by which to collect debt. The 1977 legislation also included similar exemptions as the present version of MCALA. Critical to this analysis, the legislature grouped together a subsection of exempted actors for banks, trust companies, savings and loan associations, as well as building and loan associations, and mortgage bankers.

The plain language of the original legislation provides this Court with evidence that the General Assembly exempted all of these parties with a similar consideration relating to the mortgage industry. See id. In addition to the plain language, the Fiscal Note for Senate Bill 435 emphasized that the "bill prohibits any person from engaging in the business of a collection agency in the State of Maryland without an annual license[.]" Dep't Fiscal Servs., Fiscal and Policy Note, Senate Bill 435 , at 1 (1977 Session) (hereinafter cited as "SB 435 Fiscal Note"). The Fiscal Note further advised that the Department of Licensing and Regulation 18 "assumes that 110 collection agencies will apply for the licensure." Id.

The sponsor of the legislation, Senator Clarence W. Blount, submitted written testimony in support of the bill, stating: A survey of 1900 complaints made to the Consumer Protection Division during the first six months of 1976 shows that 3% involve debt collection. This means that they are receiving an average of 2 or 3 calls a week about debt collection. In 9 or 10 of these cases the Division has issued cease and desist orders. However, the Division reports that they don't go into harassment cases because they are too difficult to prove.

They only pursue complaints where they have something in writing to base their case on .... In the years that I have worked on this legislation we have managed to resolve most of the differences with the industry[.] Senator Clarence W. Blount, Senate Bill 435, Re: Licensing of Debt Collection Agencies , Hearing on Senate Bill 435 Before the Economic Affairs Comm. of the Senate, 1977 Leg., 383th Sess. (Md. 1977) (written testimony of Senator Clarence W. Blount) (hereinafter cited as "Senator Blount Testimony"). Senator Blount stressed the urgent "need for this legislation" largely because the "present conditions, inflation, the high rate of unemployment, and the layoffs and hardships" have led to "[m]ore cases of abuse" by collection agencies.

Id. Senator Blount also testified regarding the exempted actors. Specifically, Senator Blount indicated in his written testimony that "[e]xcluded from the licensure requirement are regular employees of a creditor or collection agency, banks, and savings and loan association, abstract [title] companies, lawyers, and those acting under court order .... Mortgage bankers should also be excluded under this section, and I have an amendment to do this." Id.

Indeed, Senator Blount submitted amendments to Senate Bill 435 before the second reading of the bill, which added "mortgage banker" to the list of entities exempted from MCALA. Senator Clarence W. Blount, Amendments to Senate Bill NO. 435 , Second Reading Bill File Before the Economic Affairs Comm. of the Senate, 1977 Leg., 383th Sess. (Md. 1977) (hereinafter cited as "Senator Blount Amendments"). On March 21, 1977, the Senate Economic Affairs Committee passed Senate Bill 435 as favorable with amendments, agreeing with Senator Blount that mortgage bankers should be excluded from the MCALA licensing requirements.

Three years after the General Assembly passed Senate Bill 435, the Department of Fiscal Services issued an evaluation report prepared pursuant to the Regulatory Program Evaluation Act of 1978. Dep't Fiscal Servs., The Collection Agency Licensing Board: An Evaluation Report Prepared Pursuant to the Regulatory Programs Evaluation Act of 1978 (1980) (hereinafter cited as "Evaluation Report"); see also 1978 Md. Laws, ch. 808. In an introductory letter to the report, the Department of Fiscal Services explained that the document consisted of an "evaluation of the Maryland Collection Agency Licensing Board" meant "to assist the Senate Economic Affairs Committee and the House Environmental Matters Committee in preparing their report to the General Assembly." Evaluation Report at 1. The evaluation report first provided a description of "the Industry," in which the Department of Fiscal Services noted that in "Maryland, only third-party collectors are licensed.

Currently, 174 debt collection agencies have received licenses through the Collection Agency Licensing Board of Maryland." Id. at 2. The report continued its description of the collection agency industry: Collection agencies collect money due to businesses or creditors other than the agency itself. Usually creditors refer to collection agencies accounts that are long overdue and difficult to collect. The service is generally performed on a commission or on a percentage basis ....

A mail survey of 89 licensed collection agencies in Maryland reveals that most clients are either hospitals, doctors, retail stores or banks .... Collection agencies usually attempt to collect debts over the telephone or by mail. Typically, an agency has a telephone bank of employees and a clerical support staff. Most collection agencies are small businesses.

Id. at 2-3. In connection with its industry description, the Department of Fiscal Services included a table ("Table 1") in which the Department broke down the clients of collection agencies, listing medical clients, such as doctors and hospitals, as constituting 54% of clients, retail stores as constituting 23% of clients, banks as constituting 10% of clients, and insurance companies, credit card companies, utilities, newspapers, and contractors as constituting 13% of clients. Id. at 3. The Department of Fiscal Services also explained the continued need for regulation.

Specifically, the Department noted: Creditors typically refer to collection agencies only the least collectible accounts. Since agencies are compensated only when they collect, this can lead to abuse. Board members mention harassment, abusive language, and attempting to collect debts not owed as the most prevalent forms of abuse in Maryland. Other abuses include misrepresentation, disclosing credit information to third parties, impersonating government officials or attorneys and simulating the legal process ....

The primary justification for regulation of this industry is the protection of the public. Id. at 7. This legislative history provides insight into the purpose of the original collection agency licensing statute. Specifically, Senator Blount's testimony confirms that the legislature was acting to license and regulate the collection agency industry after the high number of complaints regarding the industry's harassing practices.

Indeed, the bill file makes clear that collection agency harassment was prevalent during this time period in 1976 and 1977 when the rate of unemployment and inflation sharply increased. See Senator Blount Testimony. The Fiscal Note also indicated that the Department of Licensing and Regulation only anticipated that 110 collection agencies would be required to apply for a license, which signifies that the legislature had a general idea of the actors involved in the collection agency industry and intended specifically to license and regulate those actors in order to prevent abusive practices. See id. ; see also SB 435 Fiscal Note, at 1.

Senator Blount made clear to the Senate Economic Affairs Committee that certain actors would be excluded and that mortgage bankers should be added to those entities exempted from MCALA. See Senator Blount Amendments. Overall, the language of the original collection agency licensing statute and the pertinent legislative history indicates that the scope of the initial licensing requirement was limited to an industry of collection agencies, which largely consisted of small businesses collecting medical and retail accounts by contacting debtors via telephone or mail. In 2007, DLLR requested House Bill 1324, which sought to address new issues under the collection agency licensing act.

See 2007 Md. Laws, ch. 472. Significant to the instant appeal, the 2007 departmental bill changed the definition of "collection agency" to include "a person who: (1) engages directly or indirectly in the business of: ... collecting a consumer claim the person owns, if the claim was in default when the person acquired it[.]" Id. Once again, the plain language of the legislation does not provide a definitive scope of regulation. In other words, the language of House Bill 1324 does not unambiguously indicate whether DLLR requested the bill in order to expand the scope of MCALA to industries beyond the ordinary understanding of collection agencies.

Moreover, it is not clear whether the Department intended to regulate any person who buys a single defaulted account and then pursues a lawsuit to collect that debt. Equally unclear is whether DLLR was simply trying to license certain collection agencies that bought the defaulted accounts before engaging in collection practices. This Court will consider further legislative history to discern the reason the General Assembly revised MCALA in 2007. This Court has long considered the "bill request form" as part of its legislative intent analysis.

Kaczorowski , 309 Md. 505 , 515, 525 A.2d 628 (1987) ("We identified that scheme or purpose after an extensive review of the context of [the contested legislation], which had effected major changes [on the overall statute]. That context included, among other things, a bill request form , ... a bill title, related statutes, and amendments to the bill.") (Emphasis added) (citations omitted). See also In re Anthony R. , 362 Md. 51 , 58, 763 A.2d 136 (2000) ; State v. One 1983 Chevrolet Van Serial No. 1GCCG15D8D 104615 , 309 Md. 327 , 329, 524 A.2d 51 (1987). When a department requests legislation, 19 that department is required to submit a bill request directly to the Governor's office for review and approval. 20 In this case, DLLR submitted a bill request for proposed revisions to MCALA to the Governor's office in 2006. 21 The Department's "Proposal for Legislation 2007 Session" included a section entitled Summary for Governor's Review that provided an overview of Maryland's collection agency industry as regulated under MCALA: Debt collectors/collection agencies are an essential part of commerce when credit is used to buy goods and services .

Collection activities in regard to commercial debt remain largely unregulated. However, abusive collection practices concerning consumer debt resulted in state and federal regulation of the activities of collection agencies collecting consumer debt . In 1978 [sic], Maryland enacted the Collection Agencies Licensing Act, which required any person engaged in the practice of collecting debts for others to be licensed by the State Collection Agency Licensing Board. The Collection Agency Licensing Board is made up of two public members, two industry members and the Commissioner of Financial Regulation.

This Board has unanimously recommended that this legislation be adopted. Maryland law regulates collection firms that collect debt as agents on behalf of other entities. The law [ ] does not require licensing for businesses that collect their own consumer debt. Elements of the collection industry have noted a loophole and now enter into "purchase agreements" in regard to delinquent debt rather than act as an agent for the original creditor.

The terms of the purchase contract may closely resemble the terms of a collection agency agreement (the purchase price is primarily a percentage of the amount collected) etc. Although federal law governs the collection activities of these firms in collecting "purchased" debt , they currently need no Maryland license and the complaint resolution and regulatory action provided to Maryland residents is avoided. "Debt purchasers" circumvent current State collection laws, by engaging in debt collection business in Maryland without complying with any licensing or bonding requirement .... This legislative proposal would include debt purchasers within the definition of a "collection agency", [sic] and require them to be licensed by the State Collection Agency Licensing Board before they may collect consumer claims in this State. Businesses that are collecting their own debt continue to be excluded from this law ....

Secretary James D. Fielder, Proposal for Legislation 2007 Session , Department of Labor, Licensing, and Regulation (Md. 2007) (hereinafter cited as "Secretary Proposal for Legislation") (emphasis added). 22 Here, the department highlights the narrow scope of its request. DLLR requested the 2007 bill specifically to regulate actors in the "collection industry" that employed a loophole in MCALA's licensing requirement by purchasing the delinquent consumer debt for "goods and services" via a purchase contract that "may closely resemble the terms of a collection agency agreement[.]" Id. Moreover, the bill request explains that the department considered "debt purchasers" to be those firms engaged in "debt collection business" that were entering into these purchase contracts. Id.

Therefore, the department clarifies that it did not intend to regulate or license any actors outside the scope of the collection agency industry; rather, DLLR requested the 2007 departmental bill in order to ensure that all actors within that industry were complying with the licensing requirement as well as the "complaint resolution and regulatory action" under MCALA. Id. The bill request also included a Fiscal Estimate Worksheet in which DLLR analyzed the "effect of the proposed legislation on the agency (operations, funding, etc.)." Id. (cleaned up).

The Department estimated only 40 debt purchasers to become licensed under the 2007 bill and "anticipate[d] a small growth in the number of licensees, approximately 2 new licensees per year." As such, this Court finds unlikely that the Department was proposing regulation of new industries. Id. Specifically, DLLR requested this departmental bill in order to close a loophole within the collection agency industry rather than to broaden the scope of MCALA to apply to other industries, such as the mortgage industry. In addition to the bill request, the purpose paragraph of House Bill 1324 states: "FOR the purpose of altering the definition of 'collection agency' as it related to the licensing and regulation of collection agencies ; requiring certain additional persons to be licensed by the State Collection Agency Licensing Board before they may collect consumer claims in this State [.]" Id.

(Emphasis added) . The language in the purpose paragraph conveys that the General Assembly intended to alter the definition of collection agencies only insofar as it related to the licensing and regulation of the collection agencies seeking consumer debt. Moreover, the purpose paragraph indicates that these additional actors need to obtain a license under MCALA before they "collect consumer claims[.]" Nothing in the purpose paragraph indicates that the General Assembly intended to expand the scope of MCALA beyond the collection agency industries that collect consumer claims. Indeed, nothing in the above language suggests that the departmental bill was enacted for the purpose of regulating and licensing the mortgage industry.

In addition, the Fiscal Note for House Bill 1324 outlines the general purposes of the legislation: the "bill extends the purview of the State Collection Agency Licensing Board to include persons who collect a consumer claim acquired when the claim was in default[.]" See Dep't Legis. Servs., Fiscal and Policy Note, House Bill 1324 , at 1 (2007 Session) (hereinafter cited as "HB 1324 Fiscal Note"). The Fiscal and Policy Note also has key language regarding the scope of the legislation: DLLR advises that the State Collection Agency Licensing Board currently regulates 1,304 collection agencies. The department estimates that the bill would make 40 debt purchasers subject to State regulation .

Debt purchasers are not currently subject to regulation, as they purchase the debt directly from the creditor and are generally compensated as a percentage of their recovery . Id. at 2 (emphasis added). Another key legislative history document in the bill file is the floor report. 23 The Floor Report for House Bill 1324 contains the following anticipated question: "What problem is this bill addressing?" Floor Report, House Bill 1324, Collection Agencies - Licensing, Economic Matters Committee of the House of Delegates, 2007 Leg., 423th Sess. (Md. 2007) at 3 (hereinafter cited as "HB 1324 Floor Report").

In response, the Floor Report recommends the Delegate answer as follows: Although debt collectors must be licensed in Maryland to collect debts owed to a creditor, currently individuals collecting debts owed to themselves are exempt. Creditors have taken to selling defaulted receivables at a discount to collectors who are not licensed under Maryland law[.] Id. (Emphasis added). The Floor Report's answer indicates that the legislature intended to regulate "debt purchasers" who essentially act as "collectors," but avoid the license requirement by purchasing the defaulted account from the creditor before engaging in collection activities.

These legislative history documents convey that the legislature was concerned specifically with certain collection agencies, or "collectors," that own a defaulted account but are still compensated as a percentage of recovery. Floor Report at 3. Indeed, the Department only expected "40 debt purchasers" to become subject to regulation as a result of the 2007 departmental bill. HB 1324 Fiscal Note, at 2.

This language affirms that House Bill 1324 did not intend to expand the coverage of MCALA beyond those collection agencies that purchase delinquent consumer debts. This interpretation is again confirmed by the Department's written testimony submitted by the Commissioner of Financial Regulation and Chairman of the Collection Agency Licensing Board, Charles W. Turnbaugh. The Commissioner encouraged the legislators to issue a favorable report for the bill requested by DLLR, stating: Maryland law regulates collection firms that collect consumer debt as agents of the creditor (hospitals, retailers, credit card issuers etc.). The law does not require licensing for businesses that only collect their own consumer debts[.] However, the evolution of the debt collection industry has created a "loophole" used by some entities as a means to circumvent current State collection agency laws.

Entities, such as "debt purchasers" who enter into purchase agreements to collect delinquent consumer debt rather than acting as an agent for the original creditor, currently collect consumer