Gee v. Mass Transit Administration

GARRITY, Judge. The appellant, Helen Gee, an individual who had filed a complaint of handicap discrimination, asks us to review the actions of the lower court and the Appeal Board of the Maryland Commission on Human Relations to determine whether the decision to grant the Motion to Dismiss of the appellee, Mass Transit Administration, was proper. We shall reverse the judgment of the Circuit Court for Baltimore City. Facts On January 30, 1977, the appellant filed an application with the Mass Transit Administration (MTA) to become a bus driver.

She was given a vision test which revealed that without glasses the acuity of her right eye was below the effective vision standards required for that of a bus operator. As a result, on July 11, 1977, the appellant was informed that her application would be rejected. On July 18, 1977, the appellant filed a complaint with the Maryland Commission on Human Relations (Commission) in which she alleged that the MTA had discriminated against her by refusing to hire her due to a physical handicap. The complaint was authorized for investigation by the Executive Director of the Commission on April 4,1979.

A copy of the complaint was served on the MTA on April 11, 1979, one year and nine months after the complaint was filed with the Commission. The Commission investigated the complaint, and on March 10, 1981, issued written findings that, inter alia, probable cause existed to believe that the MTA had ²⁵⁷ discriminated against the appellant by refusing to hire her due to her physical handicap. The Statement of Charges was filed on June 15, 1981. The MTA filed a Motion to Dismiss on July 31, 1981, alleging that the Commission prejudicially delayed the proceedings.

The Hearing Examiner issued an Opinion and Order on November 2, 1981, denying the MTA’s motion. A hearing on the merits was conducted on March 29, 1982, culminating in an Opinion and Provisional Order which denied the MTA’s motion and found that the MTA had discriminated against the appellant due to a physical handicap. The MTA noted timely appeals to the Appeal Board of the Maryland Commission on Human Relations (Board) from the Hearing Examiner’s decision on the merits and the denial of its Motion to Dismiss. On August 8,1985, the Board reversed the decision of the Hearing Examiner and dismissed the case solely on the basis of the timeliness issue.

The Commission moved for reconsideration and by Order dated September 10, 1985, that motion was denied. The appellant appealed to the Circuit Court for Baltimore City which, after a hearing, issued an Order affirming the Board’s decision. From the circuit court’s Order the appellant filed this appeal. The appellant claims that her case was improperly dismissed by the Board.

She argues that: the dismissal denied her due process; the Board misinterpreted the applicable statute and regulations; and that dismissal, in any event, was not an appropriate sanction for the Commission’s failure to follow its designated procedures. I. At the time the appellant filed her complaint on July 18, 1977, the Commission was governed by statute, Md.Code Ann. Art. 49B, and by the Rules of Procedure Before the Maryland Commission on Human Relations (Rules of Proce ²⁵⁸ dure). Within five months, on December 6, 1977 regulations were issued which promulgated the Commission’s procedural rules and public hearing process in the Code of Maryland Regulations (COMAR). The MTA’s Motion to Dismiss was filed July 31, 1981, after the Commission issued its written findings that probable cause existed to believe that the MTA had discriminated against the appellant and after a Statement of Charges had been filed against the MTA.

The motion was to dismiss the Statement of Charges. The reason stated, however, related solely to the late service of the complaint, which the MTA had received 26 months before the Statement of Charges had been filed. The MTA argued in the motion that at the time of the filing of the complaint the Commission’s regulations had not been promulgated, and that, consequently, the Commission was regulated by Article 49B. The motion stated that the Commission had violated the statute to such an extent that the inordinate delay resulted in the MTA being substantially prejudiced.

The MTA further argued that “the General Assembly mandated that promptness was one of the most important aspects of the Complaint—Investigation—Public Hearing process. Failure to address complaints and the issues raised therein with dispatch can only lead to chaos.” It is evident that the theory of the motion was to dismiss the complaint for lack of timely service. The Hearing Examiner dismissed the motion and in his November 2, 1981, Opinion and Order found that the “prompt” language of the statute was clarified and interpreted by the regulations effective December 6,1977, which required that an investigation be concluded by written findings within two years from the date of the receipt of the complaint by the respondent. The written findings had been issued within the two-year period.

The Hearing Examiner further found that the Commission’s failure to serve the complaint on the MTA for one year and nine months did not violate the statute and require dismissal because Art. ²⁵⁹ 49B, § 10(a) 1 required prompt investigation after referral to staff, not prompt referral to staff for investigation. He also found that the MTA failed to file its Motion to Dismiss timely as required by the regulations and he rejected the MTA’s argument of prejudicial delay. The Examiner issued his Opinion and Provisional Order on August 6, 1982, and on September 2, 1982, the MTA noted an appeal to the Board. The MTA argued that the Commission had exceeded its jurisdiction and authority by seeking to impose its own standards on the MTA; that the Commission failed to follow its own statutory mandate and regulations in processing the complaint and filing the Statement of Charges in a timely manner; that the Commission failed to prove that Ms. Gee had a “physical handicap” within the meaning of Art. 49B, § 15(g); that the Opinion and Provisional Order was arbitrary and capricious; that back pay was improperly awarded; and, that the Hearing Examiner erroneously refused to adopt the Respondent’s Proposed Findings of Fact and Conclusions of Law.

On August 8, 1985, the Board issued its Opinion which reversed the decision of the Hearing Examiner solely on the grounds that the Commission failed to comply with its rules and regulations with regard to timely notice to MTA. The Board stated: We believe the language of Article 49B, § 10(a) and COMAR 14.03.01.02 F.(l) to be unambiguous, mandatory language which was not intended merely to govern internal agency procedures but was specifically adopted to confer important procedural benefits and safeguards upon respondent parties to the commission’s proceedings. Hopkins v. Md. Inmate Griev. Comm’n, 40 Md.App. 329, 337 [ 391 A.2d 1213 ] (1978).

We disagree with the commission that the provisions cited above are merely of a “housekeeping” nature. ²⁶⁰ The Board went on to note that the regulations provide a penalty for failure to adhere to the time requirements and the use of the word “shall” in the regulations should be considered as mandatory and must be complied with since there is no indication that the notice requirement is merely directory. The Board further noted that: It is well established that rules and regulations promulgated by an administrative agency cannot be waived, suspended or disregarded in a particular case as long as such rules and regulations remain in force ... and that an agency of the government must scrupulously observe rules, regulations or procedures which it has established. When it fails to do so, its action cannot stand and courts will strike it down. Hopkins v. Maryland Inmate Griev.

Comm’n., 40 Md.App. 329, 335-36 , 391 A.2d 1213 (1978). We believe the Board’s reversal of the Hearing Examiner’s decision was improper. In reviewing the Hearing Examiner’s decision the Board improperly applied CO-MAR to justify its reversal. As noted above, COMAR’s effective date was after the complaint had been filed with the Commission.

Generally, when a change in the law occurs, it affects all new and pending cases to which it applies unless the statute specifically states otherwise or affects a party’s substantive rights. Janda v. General Motors, 237 Md. 161 , 205 A.2d 228 (1964). Because of the potential for interference with substantive rights ... and because of the resulting prejudice against retroactive application, the presumed intent is that statutes operate prospectively and are to be construed accordingly. Nevertheless, if the statute contains a clear expression of intent .that it operate retrospectively, or the statute affects only procedures or remedies, it will be given retroactive application. ²⁶¹ State Comm’n on Human Relations v. Amecom Division, 278 Md. 120, 123-24 , 360 A.2d 1 (1976) (citations omitted).

When the regulations were issued on December 6, 1977, the present case was pending before the Commission. There is no indication that the regulations were intended to operate retrospectively. Furthermore, any retrospective application of the regulations would obviously affect the substantive rights of Ms. Gee. 2 Consequently, based on the facts and circumstances of this case, we hold that the regulations are inapplicable. The applicable statute in effect on July 18, 1977 was Article 49B, and § 13(a) 3 required, in part, that: After the filing of any complaint the Executive Director shall consider the complaint and shall refer it to the Commission’s staff for prompt investigation and ascertainment of the facts.

The language of the statute clearly required “prompt investigation and ascertainment of facts” after the Executive Director considered and referred it to the Commission’s staff. The statute set forth no time within which the respondent had to be served with the complaint. In fact, the statute does not require that the complaint be served upon the respondent until after the investigation is completed, there has been a finding of cause to believe discrimination was committed, and there has been a failure to reach agreement as to the elimination of the discrimination. Indeed, the statute is clear in its requirement that the potential respondent not be subjected to a complaint until a preliminary investigation has been conducted to insure the ²⁶² reliability of the information in the complaint.

Banach v. St. Comm’n on Human Rel., 277 Md. 502 , 356 A.2d 242 (1976); Solely v. St. Comm’n on Human Rel., 277 Md. 521 , 356 A.2d 254 (1976). The Court of Appeals observed in Banach that “it is at the adjudicatory stage of the administrative proceeding that the parties must be accorded such traditional elements of fair play as notice of charges and opportunity to be heard.” Id. [277 Md.] at 515, 356 A.2d 242 . The Court went on to note that: [T]he term “hearing” refers to quasi-judicial proceedings where the “traditional safeguards” of fairness must be observed, while the same test need not be met in the “non-judicial” investigative stage. It is only when the conciliation process prescribed by § 13 [§ 10] fails and the hearing stage contemplated by § 14 [§ 11] is invoked that the investigative yields to the adjudicative function.

Id. The Commission’s Rules of Procedure were promulgated pursuant to the Administrative Procedure Act, Art. 41, § 244 et seq. (1971) and required the Commission’s staff to furnish the respondent with notice of the complaint in a timely fashion. Promptly after a complaint is filed the Commission staff shall furnish the respondent with a notice thereof ...

Despite the seemingly mandatory nature of this rule we believe that the Commission’s failure to serve promptly the respondent with notice of the complaint did not warrant dismissal. Using the reasoning enunciated by this court in Bellamy v. State, 50 Md.App. 65, 78-79 , 435 A.2d 821 (1981), where we held that the late filing of a report by the Department of Mental Hygiene did not warrant a dismissal, we note first that the Rules of Procedure did not provide a sanction for the failure to serve the respondent promptly with notice in accordance with the dictates of the statute. See Brodak v. Brodak, 294 Md. 10 , 447 A.2d 847 (1982); Pope v.