Fraternal Order of Police, Montgomery County Lodge 35 v. Montgomery County

MEREDITH, J. The Circuit Court for Montgomery County denied a Petition for Award of Costs and Disbursements that was filed by Fraternal Order of Police, Lodge 35 (“appellant” or “FOP”), which was seeking reimbursement of the fees it incurred in fending off a motion to stay a request for arbitration. FOP’s claim for attorneys’ fees and costs was filed after appellant scored a court victory over Montgomery County (“appellee” or “the County”); the Court of Appeals ruled that a grievance filed by FOP was subject to arbitration pursuant to a collective bargaining agreement between the parties. Montgomery County, Maryland v. Fraternal Order of Police, Montgomery ⁶³⁶ County Lodge 35, Inc., 427 Md. 561, 567 , 50 A.3d 579 (2012) (hereafter referred to as “FOP /”). After the Court of Appeals ruled in FOP I that the grievance was indeed subject to arbitration, FOP filed its petition asking that the Circuit Court for Montgomery County order the County to reimburse FOP for the litigation expenses and costs it had incurred up to that point in its efforts to establish and confirm that the grievance was arbitrable.

The circuit court rejected FOP’s argument that § 3-228(b) of the Courts and Judicial Proceedings Article of the Maryland Code authorizes such an award of litigation expenses at that preliminary stage in the arbitration proceedings, and the court denied FOP’s fee petition. This appeal followed. QUESTION PRESENTED Appellant presents a single question for our review: Does Section 3-228(b) of the Maryland Uniform Arbitration Act permit a court, following litigation of a petition to stay arbitration, to award the prevailing party reasonable attorneys’ fees and costs? We will affirm the circuit court’s denial of the appellant’s Petition for Award of Costs and Disbursements.

FACTS AND PROCEDURAL HISTORY The proceedings that led to the present dispute were described as follows by the Court of Appeals in FOP I: The Fraternal Order of Police, Montgomery County Lodge 35, Inc. (“FOP” or “Appellee”) filed a grievance under the “Maintenance of Standards” provision of its collective bargaining agreement (“CBA” or “Agreement”) with Montgomery County (“County” or “Appellant”) following the County’s unilateral decision to discontinue a long-standing practice of allowing shop stewards to sit in on disciplinary interrogations for training purposes. The County filed a motion to dismiss the grievance, arguing that arbitration of the issue was preempted by the Law Enforcement Officers’ Bill of Rights ... [LEOBR]. The arbitrator deter ⁶³⁷ mined that the grievance was not preempted and denied the motion to dismiss. The County then filed a petition to vacate the “arbitration award” in the Circuit Court for Montgomery County.

The Circuit Court affirmed the arbitrator’s decision and granted summary judgment on behalf of the FOP. We affirm the judgment of the Circuit Court that the LEOBR is not implicated by the steward training grievance and, therefore, does not preempt its arbitration under the CBA. 427 Md. at 564 , 50 A.3d 579 (emphasis added) (footnote omitted). The Court of Appeals observed in FOP I that the County had been mistaken in labeling its motion as a petition to vacate an arbitration award; there was no award to be vacated. Consequently, the Court of Appeals treated the claim for relief which the County had labeled a “petition to vacate” as a motion to stay arbitration.

The Court explained, id. at 568-69 , 50 A.3d 579 : Preliminarily, we take this opportunity to clarify the procedural issue raised by the trial judge when, in confirming the determination of the arbitrator, he noted confusion as to whether a petition to “vacate” was the “correct terminology,” under the circumstances. Indeed, by filing a petition to vacate the “arbitration award,” the County suggested that an award was, in fact, made by the arbitrator. It used language throughout the petition that referred to the arbitrator’s denial of its dispositive motion as an “award,” despite its preliminary nature and the fact that arbitration on the merits had not taken place. Appellant apparently relied on Montgomery County v. Fraternal Order of Police Montgomery County Lodge 35, Inc., 147 Md.App. 659 , 810 A.2d 519 (2002) (“Lodge 35 ”), as the blueprint for pursuing this procedural error.

In that case the FOP requested arbitration, and the County, rather than petitioning the circuit court for a stay of arbitration, filed a motion to dismiss before the arbitrator, arguing that the particular dispute was not arbitrable. After the arbitrator denied the motion to dismiss, the County filed a “peti ⁶³⁸ tion to vacate arbitration award” in the circuit court. The circuit court affirmed the determination of arbitrability, which was then appealed. On appeal, the intermediate appellate court stated that although the arbitrator issued a preliminary decision rather than a final award, “[n]evertheless, the parties have not argued that an arbitrator has to render a final award before a petition to vacate a preliminary decision can be filed, and we are not aware of any authority compelling that conclusion.” Lodge 35, 147 Md. App. at 666 , 810 A.2d at 523 .

The intermediate appellate court then continued to evaluate whether the arbitrator exceeded his powers and whether the “award” should be “vacated” under the Arbitration Act, Maryland Code § 3-224 of the Courts and Judicial Proceedings Article. The reasoning of the intermediate appellate court in Lodge 35 is incorrect because it is clear, pursuant to our case law, that a petition to vacate an arbitration award requires an actual award, i.e., a final decision by an arbitrator on the merits. See Messersmith, Inc. v. Barclay Townhouse, 313 Md. 652, 663 , 547 A.2d 1048, 1053 (1988) (noting that Md.Code § 3-208 and § 3-224 of the Courts and Judicial Proceedings Article are “mechanisms through which a court (based upon its independent assessment of the evidence thereby concluding that no agreement to arbitrate exists) is authorized to either stay an arbitration proceeding, under § 3-208, or invalidate it after the fact, under § 3-224(b)(5).” (emphasis added)); Brewster v. Woodhaven Bldg. & Dev., Inc., 360 Md. 602, 620 , 759 A.2d 738, 753-54 (2000) (noting that § 3-224 is one of three sections of the Arbitration Act which “permit parties who have been through arbitration to file certain post-award petitions in the Circuit Court ...” (Wilner, J., dissenting on other grounds)); Stauffer Constr. Co. v. Bd. of Educ., 54 Md.App. 658, 664 , 460 A.2d 609, 612 (1983) (“When such an [arbitration] agreement exists, or is alleged to exist, the courts are generally enjoined by the statute from interfering with the arbitration process.

Indeed, the court’s jurisdiction [before arbitration is completed] may properly be invoked in but ⁶³⁹ two limited contexts—to compel arbitration or to stay it.”); Martin Domke, Domke On Commercial Arbitration, § 39:6 at 15-16 (3d ed. 2012) (“Before an [arbitration] award is ripe for review, it must be ‘definite and final,’ ” and resolve the parties’ dispute, (footnote omitted)). Despite [the fact that the County filed] an incorrect motion, however, we treat the County’s “petition to vacate arbitration award,” in the present case, as a motion to stay arbitration. The Court of Appeals ruled in FOP I that the circuit court’s denial of the County’s motion to stay the arbitration was immediately appealable because such an order “ ‘exhausts the court’s jurisdiction.’ ” Id. at 570, 50 A.3d 579 (quoting Brewster, supra, 360 Md. at 631 , 759 A.2d 738 ). Similarly, the order as to which FOP noted the present appeal exhausted the circuit court’s jurisdiction once again, and was immediately appealable.

The instant appeal flows from FOP’s decision to file in the circuit court—before proceeding with the arbitration of its grievance—a Petition for Award of Costs and Disbursements. FOP asserts (and the County does not dispute) that the Maryland Uniform Arbitration Act (“MUAA”), codified at Md.Code (1973, 2013 Repl. Vol.), Courts and Judicial Proceedings Article (“CJP”), § 3-201 et see/., governs these proceedings. FOP argued in its fee petition that CJP § 3-228(b) authorizes the circuit court to order the County to reimburse FOP for all of the litigation expenses FOP had incurred up to that point, including attorneys’ fees, in the amount of $52,971.84.

FOP contends that CJP § 3-228(b) permits a court to enter an order for such fee shifting with respect to “any petition” that is filed relative to a proceeding under the MUAA. The County filed an opposition to FOP’s fee petition, and, following a hearing on April 9, 2013, the circuit court denied FOP’s request. FOP then noted the present appeal. ⁶⁴⁰ STANDARD OF REVIEW Because this case turns upon an issue of statutory construction, our review is de novo. Addison v. Lochearn Nursing Home, LLC, 411 Md. 251, 275-77, 983 A.2d 138 (2009).

The Court of Appeals summarized the relevant principles of statutory construction in Victoria Falls v. Prince George’s County, 438 Md. 391, 401-03 , 92 A.3d 365 , 2014 WL 1128391 (2014): “The cardinal rule of statutory interpretation is to ascertain and effectuate the real and actual intent of the Legislature. A court’s primary goal in interpreting statutory language is to discern the legislative purpose, the ends to be accomplished, or the evils to be remedied by the statutory provision under scrutiny. “To ascertain the intent of the General Assembly, we begin with the normal, plain meaning of the language of the statute. If the language of the statute is unambiguous and clearly consistent -with the statute’s apparent purpose, our inquiry as to legislative intent ends ordinarily and we apply the statute as written, without resort to other rules of construction. We neither add nor delete language so as to reflect an intent not evidenced in the plain and unambiguous language of the statute, and we do not construe a statute with ‘forced or subtle interpretations’ that limit or extend its application. “We, however, do not read statutory language in a vacuum, nor do we confine strictly our interpretation of a statute’s plain language to the isolated section alone.

Rather, the plain language must be viewed within the context of the statutory scheme to which it belongs, considering the purpose, aim, or policy of the Legislature in enacting the statute. We presume that the Legislature intends its enactments to operate together as a consistent and harmonious body of law, and, thus, we seek to reconcile and harmonize the parts of a statute, to the extent possible consistent with the statute’s object and scope. ⁶⁴¹ “Where 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 a part of a larger statutory scheme, a court must resolve the ambiguity by searching for legislative intent in other indicia, including the history of the legislation or other relevant sources intrinsic and extrinsic to the legislative process. In resolving ambiguities, a court considers the structure of the statute, how it relates to other laws, its general purpose, and the relative rationality and legal effect of various competing constructions. “In every case, the statute must be given a reasonable interpretation, not one that is absurd, illogical, or incompatible with common sense.” (Quoting Mummert v. Alizadeh, 435 Md. 207, 213-14 , 77 A.3d 1049, 1052-53 (2013).) DISCUSSION As noted above, CJP §§ 3-201 through 3-234 are known as the Maryland Uniform Arbitration Act (“MUAA”). The MUAA was adopted by the General Assembly in 1973, and the act “ ‘expresses the legislative policy favoring enforcement of agreements to arbitrate,’ Allstate Ins.

Co. v. Stinebaugh, 374 Md. 631, 641 , 824 A.2d 87, 93 (2003), by giving the courts jurisdiction to enforce arbitration agreements and enter judgments on arbitration awards.” Questar Homes of Avalon, LLC v. Pillar Constr., Inc., 388 Md. 675, 684 , 882 A.2d 288 (2005). FOP’s petition seeking costs was based expressly upon CJP § 3-228, which is captioned “Judgment, costs, and disbursements,” and provides: (a) Entering of judgment; enforcement of judgment.—(1) If an order confirming, modifying, or correcting an award is granted, a judgment shall be entered in conformity with the order. ⁶⁴² (2) The judgment may be enforced as any other judgment. (b) Costs and disbursements.—A court may award costs of the petition, the subsequent proceedings, and disbursements. In its brief, FOP asserts that “[t]he meaning of Section 3-228(b) ultimately depends on the meaning of the term ‘petition,’ as used in that provision.” FOP further contends “that subsection (b)’s reference to ‘petition’ includes both petitions to vacate arbitration awards under the MUAA ... and petitions to stay arbitration under the MUAA (as in this case), ... provided that the party filing such a petition is unsuccessful in the court proceedings.” The linchpin of FOP’s argument is its insistence that “Section 3-228(b) of the MUAA plainly permits an award of fees and costs to the prevailing party after litigation on any petition filed under the MUAA.” (Emphasis added.) It is immediately apparent that FOP’s argument is largely dependent upon its substitution of the words “any petition” for the phrase that actually appears in CJP § 3-228(b), which is “the petition.” The legislature did not use the phrase “any petition,” and we agree with the circuit court’s conclusion that it would be improper to interpret CJP § 3-228 as if that phraseology had been chosen by the General Assembly.

In the County’s brief, the appellee responded to the appellant’s argument that CJP § 3-228(b) permits a court to award fees and costs relative to “any petition filed under the MUAA” by observing, in part: The trial court correctly rejected this interpretation, which reads subsection (b) in isolation from the rest of § 3-228. The more reasonable reading of the law is one that reads § 3-228 as a whole. “The petition” in subsection (b) is a reference to the immediately preceding language in subsection (a). Thus, “the petition” in subsection (b) is any petition that results in “an order confirming, modifying, or correcting an award,” as described in subsection (a). ⁶⁴³ As noted above, the Court of Appeals observed in FOP I that, although the County erroneously captioned its motion as a “Petition to Vacate Arbitration Award,” no arbitration on the merits had taken place. The Court of Appeals stated: “[I]t is clear, pursuant to our case law, that a petition to vacate an arbitration award requires an actual award, i.e., a