Larocca v. Creig Northrop Team, P.C.

HOTTEN, J. Appellants, three married couples, obtained financing to purchase new homes through appellees, several realtors, mortgage agencies, banks and their employees. Appellants filed a class action lawsuit in the Circuit Court for Howard County, asserting a number of claims related to an alleged mortgage fraud scheme. The circuit court granted summary judgment as to all counts in appellants’ original complaint on statute of limitations grounds. It also denied class certification on grounds of insufficient numbers, and granted a motion to strike appellants’ second amended complaint because of prejudice to appellees.

Appellants appealed, presenting the following questions for our consideration: 1. Did the [cjircuit [c]ourt err in ruling that claims concerning mortgage fraud and forged leases were time-barred because inquiry notice was triggered by inconspicuous reference to “gross rental income” surreptitiously inserted on one page out of hundreds initialed and signed by [appellants? 2. Did the [cjircuit [c]ourt err in ruling that advertising a fake loan program that secretly involved forged leases and ⁵⁴³ other acts of deception did not violate the SMLL because the false and misleading information putatively concerned underwriting guidelines, not loan terms? 3. Did the [cjircuit [cjourt err in ruling that, for SMLL claims based on advertising the fake loan program that purported to be a package of secondary and primary mortgages, borrowers could only collect treble damages based on the interest and charges collected under the secondary mortgage, but not the primary mortgage? 4.

Did the [cjircuit [cjourt err in ruling that the individual loan officers who made the secondary mortgages were not “lenders” despite that the statutory definition of lenders includes individuals who make loans? 5. Did the [cjircuit [cjourt err in denying class certification based solely on concluding that the proposed class was not numerous enough because of counting transactions, not persons, and estimates of class size were only approximations that did not take into account the collapse of the housing market and other variables? 6. Did the [cjircuit [cjourt err in ruling that the filing of the [sjecond [ajmended [cjomplaint was unfairly prejudicial, despite that it was filed more than 30 days before trial, in accordance with the [cjircuit [cjourt’s [sjcheduling [ojrder, and the new claims would be barred by res judicata if not brought in this action? 7. Did the [cjircuit [cjourt err in ruling that compensation paid to Carla Northrop by Lakeview Title Company, Inc. (“Lakeview”) was not relevant to claims concerning real estate transactions brokered by Ms. Northrop’s broker and settled at Lakeview?

For the reasons that follow, we shall affirm in part and reverse in part the judgment of the circuit court. FACTUAL AND PROCEDURAL HISTORY The Parties This case involves six appellants and eleven appellees. Appellants consist of three married couples: Frank and Cather ⁵⁴⁴ ine LaRocca, Kenneth and Angela Pfeifer, and Mehdi Nafisi and Forough Iranpour. All are residents of Maryland who owned a primary residence and contacted appellees regarding purchasing a new primary residence.

Since there are eleven appellees, they have been divided into three groups. The “Realtor Appellees” are the Creig Northrop Team, P.C., (“the Northrop Team”); Crieghton Northrop (“Mr. Northrop”); Carla Northrop (“Ms. Northrop”); and Long & Foster Real Estate, Inc. (“Long & Foster”). The “Banking Appellees” are Wells Fargo Bank, N.A. (‘Wells Fargo”); Prosperity Mortgage (“Prosperity”), PNC Mortgage, a division of PNC Bank (“PNC”), formerly National City Mortgage; Michelle Mathews (“Ms. Matthews”), a loan officer for Prosperity who worked in the Northrop Team’s offices; and Suzanne Scales Windesheim (“Ms. Windesheim”), a loan officer for PNC.

The Title Appellees are Lakeview Title (“Lakeview”), a licensee of Long & Foster, and Lindell Eagan, an employee of Long & Foster. Factual Background While the dates differ, appellants generally shared the same experience in obtaining financing and purchasing their new homes through the Northrop Team. During 2006 and 2007, appellants contacted the Northrop Team regarding purchasing new homes. Through discussions with Ms. Matthews, appellants were led to believe that the Northrop Team would make available to them a “Bridge Loan Program.” Under the Bridge Loan Program, appellants would obtain financing using the equity in their old homes, while at the same time receiving a primary purchase money mortgage for their new home, that was non-contingent upon the sale of the old home.

Unbeknownst to appellants, the purported Bridge Loan Program did not exist and likely violated the underwriting policies of the lenders. Appellants allege that the Realtor Appellees concealed the lack of a Bridge Loan Program by using forgeries and other misrepresentations to obtain fraudulent financing. Appellants each entered into a non-contingency contract to purchase a new home and obtained a home equity line of credit (“HELOC”) through PNC. At each appellants’ closing ⁵⁴⁵ for the HELOC, they reviewed and signed a number of documents, including a Uniform Residential Loan Application, referred to as Form 1003.

The Laroccas and the Pfeifers closed on their HELOCs in 2006 and the Nafisis/Iranpours closed on theirs in 2007. The parties understood that under the loan program, they would be paying for three mortgages until the old homes were sold. They completed the mortgage process, sold their old homes, and paid off the HELOCs in July 2006, for the Laroccas, June 2007, for the Pfeifers, and September 2007 for the Nafisis/Iranpours. In mid-2010 and mid-2011, appellants were individually contacted by counsel, informing them that another case 1 had revealed a possible fraudulent mortgage scheme.

Appellants allege that they were unaware that the Bridge Loan Program was not legitimate. Appellants filed the instant case as a class action lawsuit in December 2011, with appellants as the named plaintiffs and proposed class representatives. In their complaint, they asserted that in order to effectuate the Bridge Loan Program, appellees acted to conceal from others that appellants still owned their old homes. Appellants claim that appellees made misrepresentations regarding appellants’ income and the status of the old homes so that appellants could qualify for loans they were unqualified for.

As a result of appellees’ fraudulent actions, their old homes were on the market for a considerably longer period of time than they normally would have been, which resulted in appellants paying three mortgages for a longer period of time and incurring more fees. Appellants also contend that the Realtor Appellees pressured them into selling their old homes below market value. ⁵⁴⁶ Procedural Background Appellants’ class action complaint included eleven counts against the Realtor and Banking Appellees. Appellees moved to dismiss the complaint, asserting statute of limitations as a defense. The court denied the motion, ordering discovery to continue so that it could be determined whether limitations barred the action.

During discovery, appellants issued a subpoena requesting compensation documents from Lakeview. Since Lakeview was not a party to the action at that time, the Realtor Appellees moved for a protective order. The court granted the order after reviewing the documents in camera and reasoning that they were not related to any of the counts alleged in appellants’ complaint. Following discovery, appellees moved for summary judgment on all counts, again arguing the statute of limitations defense.

Before the court ruled on the motion for summary judgment, appellants filed a second amended complaint, adding a new count and three new appellees, the Title Appellees and Ms. Northrop. Following a hearing on the motion for summary judgment, the court granted the motion, finding that as a matter of law, the statute of limitations began accruing at the parties’ respective HE-LOC closings in 2006 and 2007 and therefore, the limitations period had run by the time the complaint was filed in December 2011. The court also denied appellants’ motion for class certification and granted appellees’ motion to strike the second amended complaint. Appellants noted a timely appeal against all appellees.

Additional facts shall be provided, infra, to the extent they prove relevant in addressing the issues presented. STANDARD OF REVIEW Summary judgment is proper where the circuit court determines that there are no genuine disputes as to any material fact and that the moving party is entitled to judgment as matter of law. See Md. Rule 2-501. Disputes concerning contract interpretation are questions of law and frequently regarded as appropriate for summary judgment. ⁵⁴⁷ See Sandler v. Executive Mgmt.

Plus, 203 Md.App. 399, 423 , 38 A.3d 478 (2012) (noting that contract interpretation is a question of law). See also Bank of Montreal v. Signet Bank, 193 F.3d 818, 835 (4th Cir.1999). We review a circuit court’s grant of summary judgment de novo. Mitchell v. Baltimore Sun Co., 164 Md.App. 497, 506 , 883 A.2d 1008 (2005).

In reviewing the grant of a motion for summary judgment, appellate courts focus on whether the circuit court was legally correct. Laing v. Volkswagen of Am., Inc., 180 Md.App. 136, 152-53 , 949 A.2d 26 (2008) (citations omitted). “The parameter for appellate review is determining ‘whether a fair minded jury could find for the plaintiff in light of the pleadings and the evidence presented, and there must be more than a scintilla of evidence in order to proceed to trial....’” Id. at 153 , 949 A.2d 26 . “Additionally, if the facts are susceptible to more than one inference, the court must view the inferences in the light most favorable to the non-moving party.” Id. We review rulings on motions for protective orders, motions to strike, and motions for class certification all under an abuse of discretion standard. See Creveling v. Gov’t Employees Ins.

Co., 376 Md. 72, 90 , 828 A.2d 229 (2003) (“We ordinarily review a [circuit court’s] decision regarding whether to certify a class action for an abuse of discretion.”); Tanis v. Crocker, 110 Md.App. 559, 573 , 678 A.2d 88 (1996) (stating that this Court reviews the grant of a protective order under an abuse of discretion standard); Hendrix v. Burns, 205 Md.App. 1, 45 , 43 A.3d 415 (2012) (“We review for abuse of discretion a court’s decision to allow or disallow amendments to pleadings or to grant or deny leave to amend pleadings.”). “A trial judge abuses his or her discretion where no reasonable person would take the view adopted by the [trial] court.” Maryland-Nat’l Capital Park & Planning Comm’n v. Mardirossian, 184 Md.App. 207, 217 , 964 A.2d 713 (2009) (citing Fontaine v. State, 134 Md.App. 275, 288 , 759 A.2d 1136 (2000)). Our standard of review for determining whether a [circuit [c]ourt used a correct legal standard in determining ⁵⁴⁸ whether to grant or deny class certification is de novo. Philip Morris, Inc. v. Angeletti, 358 Md. 689, 726 , 752 A.2d 200 (2000). DISCUSSION 1.

Did the circuit court improperly grant summary judgment as to counts I to IX and XI because there were genuine disputes of material fact? At the conclusion of discovery, the Realtor appellees moved for summary judgment, again asserting limitations as a defense. 2 Specifically, they argued that the question of accrual of statute of limitations was a matter of law, that limitations had run a year before the lawsuit was filed, and that the discovery rule did not excuse the untimeliness. Appellees claimed that appellants were on inquiry notice of fraud at the latest in 2006, for the Larocea and Pfeifer appellants, and in 2007, for the Nafisi/Iranpour appellants, because of the mention of false “gross rental income” in Form 1003 which was signed at the HELOC closings. Appellants responded that any notice that may have occurred at the HELOC closings were irrelevant because their claim was that the Bridge Loan Program did not exist and was fraudulently marketed.

They asserted that, in order to ensure that appellants would qualify for the two new mortgages, appellees misrepresented appellants’ respective incomes, performed fraudulent acts that enabled them to conceal that appellants still owned their old homes and, in turn, the Realtor Appellees secured sales commissions by submitting noncontingent offers. Accordingly, as a result of the fraud, any notice in 2006 regarding Form 1003 was not sufficient to place appellants on notice that the Bridge Loan Program was not a legitimate loan. Therefore, pursuant to the discovery rule, their claims were timely because they did not discover the Bridge Loan Program was fraudulent until 2010. The circuit court held a hearing on the ⁵⁴⁹ motion which lasted longer than five hours.

In its memorandum opinion, the court granted summary judgment as to counts I through IX and XI. The court found that appellants had failed to establish any dispute of the fact that they had reviewed and signed Form 1003. Then, applying the “signature doctrine”, which presumes that one who signs a document is bound to its terms, the court found that appellants were on notice at the HELOC closings in 2006 and 2007 and consequently counts I through IX and XI were untimely. On appeal, appellants advance similar arguments, namely that the factual disputes regarding timeliness were a question for a jury; that the circuit court improperly applied the signature doctrine; and that one reference to “gross rental income” in hundreds of documents did not constitute notice.

Appellees maintain that there is no dispute that appellants received Form 1003 and that the Form placed them on notice of any alleged fraudulent activity. Maryland Code, (2006 Repl.Vol.2012), Courts and Judicial Proceedings § 5-101 [hereinafter Cts. & Jud. Proc.] provides: A civil action at law shall be filed within three years from the date it accrues unless another provision of the Code provides a different period of time within which an action shall be commenced. Generally, the statute of limitations begins to accrue when a plaintiff knows of the wrong he or she sustained.

See Kumar v. Dhanda, 198 Md.App. 337, 343 , 17 A.3d 744 (2011) (explaining that for example, in a breach of contract case the date of accrual is the date of the breach). Modernly, the discovery rule provides that “the cause of action accrues when the claimant in fact knew or reasonably should have known of the wrong.” Poffenberger v. Risser, 290 Md. 631, 636 , 431 A.2d 677 (1981). This Court and the Court of Appeals have acknowledged that the discovery rule, while originally adopted as an exception, is now the general rule. See Lumsden v. Design Tech Builders, Inc., 358 Md. 435, 444 , 749 A.2d 796 (2000). ⁵⁵⁰ Having already broken the barrier confining the discovery principle to professional malpractice, and sensing no valid reason why that rule’s sweep should not be applied to prevent an injustice in other types of cases, we now hold the discovery rule to be applicable generally in all actions and the cause of action accrues when the claimant in fact knew or reasonably should have known of the wrong.

Id. (quoting Poffenberger, 290 Md. at 636 , 431 A.2d 677 ). In Poffenberger , a homeowner brought suit against his homebuilder for failing to comply with applicable building restrictions. 290 Md. at 633 , 431 A.2d 677 . The home had been built in 1972 and the homeowner filed suit after he discovered the building violation in 1976.

Id. The homebuilder moved for summary judgment relying on Cts. & Jud. Proc. § 5-101, asserting that the homeowner’s suit was barred by the three year statute of limitations. Id.

The homebuilder argued that the action began accruing when the home was completed in 1972 while the homeowner argued that the action did not begin accruing until he discovered the violation in 1976. Id. at 634, 431 A.2d 677 . The circuit court granted summary judgment and the homeowner appealed. The Court of Appeals began its analysis by announcing that the discovery rule was applicable to all actions and accordingly, could be applied in the case.

Id. at 636 , 431 A.2d 677 . The homebuilder argued that the homeowner had constructive notice in 1972 because the plat and deed showed the land boundaries. Id. at 637 , 431 A.2d 677 . The Court of Appeals rejected this argument, holding that in order for there to be notice sufficient to begin tolling of the statute of limitations, a plaintiff required actual notice.

Id. It explained that there are two forms of actual notice, express and implied: Express notice embraces not only knowledge, but also that which is communicated by direct information, either written or oral, from those who are cognizant of the fact communicated. Implied notice, which is equally actual notice, arises where the party to be charged is shown to have had knowledge of such facts and circumstances as would lead him, by the exercise of due diligence, to a knowledge of the ⁵⁵¹ principal fact.... It is simply circumstantial evidence from which notice may be inferred.

Id. The Court concluded that there was no dispute that the homeowner lacked express notice, but there was clearly a dispute as to whether he had implied notice. Id. at 638 , 431 A.2d 677 . It remanded back to the circuit court so that the factual dispute could be addressed at trial.

Id. While a grant of summary judgment is appropriate where the statute of limitations has expired, the Court of Appeals has explained that the question of accrual under Cts. & Jud. Proc. § 5-101 may be a question for a jury. Frederick Rd.

Ltd. P’ship v. Brown & Sturm, 360 Md. 76, 95 , 756 A.2d 963 (2000). The Court stated that: “[t]his determination may be based solely on law, solely on fact, or on a combination of law and fact, and is reached after careful consideration of the purpose of the statute and the facts to which it is applied.” Id. Appellants rely on Dashiell v. Meeks, 396 Md. 149 , 913 A.2d 10 (2006) in support of their argument that the circuit court erred in finding that their claims were barred as a matter of law. There, Meeks hired Dashiell as his attorney in 1989 to draft a prenuptial agreement in anticipation of his upcoming wedding.

Id. at 157 , 913 A.2d 10 . According to Meeks, the draft of the agreement he reviewed "with Dashiell contained an alimony waiver provision. Id. However, unbeknownst to Meeks, the final version which he and his flaneé signed did not include the waiver.

Id. At trial, Meeks claimed that he was unaware any changes had been made between the first draft and the final draft, and that Dashiell had indicated that he did not need to read the final draft because no changes had been made. Id. at 159 , 913 A.2d 10 . In 2001, Meeks and his wife separated and it was at this point Meeks discovered the signed agreement lacked the alimony waiver.

Id. Meeks filed a legal malpractice action against Dashiell claiming he was negligent in failing to include the waiver and in advising Meeks that he did not need to read the contract prior to signing. Id. Dashiell moved for summary judgment, arguing in part that the claim was barred under the three year statute of limitations.

The court granted the motion based on limitations and ⁵⁵² Meeks appealed to this Court. Id. We vacated the circuit court’s ruling, concluding that the claim was not barred by the statute of limitations. Id. at 158 , 913 A.2d 10 (citing Meeks v. Dashiell, 166 Md.App. 415 , 890 A.2d 779 (2006) (en banc)).

Dashiell appealed and the Court of Appeals granted certiorari. The Court began its analysis by acknowledging the general rule “under Maryland contract law that, as between the parties to an agreement, a party who signs a contract is presumed to have read and understood its terms and that the party will be bound by them when that document is executed.” Id. at 167, 913 A.2d 10 . The Court explained that absent fraud, duress or mutual mistake, the Court will not rescind an agreement because one party, due to their own carelessness in reading the terms, does not want to abide by the agreement. Id.

The Court then held that the trial court erred when it found that Meeks was “charged with knowledge ... at the time he signed the document.” Id. at 168 , 913 A.2d 10 . Applying the discovery rule, the Court concluded that there was a question of fact regarding whether Meeks was on notice. It held that “the discovery rule tolls the running of the statute of limitations and it is ordinarily a question for the jury or the ultimate factfinder as to whether the plaintiff failed to discover the cause of action because he failed to exercise due diligence or whether he was unable to discover it (and, as a result, unable to exercise due diligence) because the defendant concealed the wrong.” Id. at 169 , 913 A.2d 10 . This Court and the Court of Appeals have reached the same conclusion in other cases.

See Frederick Road, 360 Md. 76 , 756 A.2d 963 (2000) and Supik v. Bodie et al., 152 Md.App. 698 , 834 A.2d 170 (2003). In Frederick Road , an elderly couple, the Kings, hoping to minimize estate and gift taxes, contacted their attorney, Brown, regarding transferring their farm land to their children before they died. 360 Md. at 81 , 756 A.2d 963 . The Kings’ other attorney, Wolf, believed that the land was valued somewhere between $20 million and $100 million. Id.

Brown believed that if the Kings appraised the farm as “farm use only”, valuing it between $515,000 and $720,000, they would incur significant tax savings. Id. Wolf ⁵⁵³ strongly disagreed with Brown’s advice and expressed his objections to the Kings. Id. at 82 , 756 A.2d 963 .

Eventually, in 1981, the Kings proceeded with Brown’s plan, sold their farm to their children for approximately $600,000 and discharged Wolf as their attorney. Id. In response, Wolf sent the Kings a letter expressing his concerns regarding Brown’s valuation plan and that they could be subject to serious tax consequences. The Kings died and Brown continued to represent the King children on matters relating to the farm.

Id. at 84 , 756 A.2d 963 . Five years after the transfer, the IRS began investigating the land transfer and issued a deficiency assessment of more than $68 million in penalties and taxes. Id. The IRS contended the sale of the land had been undervalued and as a result, not enough taxes had been paid.

Id. Brown convinced the King children that Wolf had sent the IRS his letter to their parents expressing his concerns about the sale amount, and as a result, they had no defenses and should settle with the IRS for $20 million. Id. at 85 , 756 A.2d 963 . The King children agreed and in 1988 settled with the IRS.

In 1991, they filed a malpractice suit against Wolf. Id. at 87 , 756 A.2d 963 . The circuit court granted Wolf summary judgment reasoning that if the King children had sustained any damages, it was the result of Brown’s poor legal advice in the 1981 sale and Brown’s failure to contest the admissibility of Wolfs letter in tax court. Id.

In 1995, seven years after the IRS settlement, the King children filed a malpractice action against Brown. Id. at 88 , 756 A.2d 963 . The circuit court granted Brown summary judgment after finding that the King children’s claims were barred by statute of limitations and/or laches. Id. at 89 , 756 A.2d 963 .

The King children appealed and we affirmed the circuit court’s judgment. Id. See also Frederick Road v. Brown & Sturm, et al., 121 Md.App. 384 , 710 A.2d 298 (1998). Before the Court of Appeals, the King children argued that Brown had deliberately prevented them from discovering his wrongdoing and that therefore, the court erred in finding their claims were barred.

Id. at 91, 756 A.2d 963 . Brown contended that there were distinct acts in 1982, 1985, 1987, and 1988 ⁵⁵⁴ that placed the King children on inquiry notice of a potential cause of action. Id. at 92 , 756 A.2d 963 . The Court of Appeals reviewed the underlying principles of the discovery rule.

Id. at 95-96 , 756 A.2d 963 . It explained that “the question of notice generally requires the balancing of factual issues and the assessment of the credibility or believability of the evidence.” Id. at 96 , 756 A.2d 963 . (quoting O’Hara v. Kovens, 305 Md. 280, 294-95 , 503 A.2d 1313 (1986)). The Court also explained that there were some circumstances that would toll the statute of limitations, including fraud, pursuant to Cts. & Jud.

Proc. § 5-203. 3 Id. at 98, 756 A.2d 963 . Again, quoting O’Hara , the Court explained that for fraud: [B]eing ‘on notice’ means having knowledge of circumstances which would cause a reasonable person in the position of the plaintiffs to undertake an investigation which, if pursued with reasonable diligence, would have led to knowledge of the alleged fraud. Id. at 99, 756 A.2d 963 (quoting O’Hara, 305 Md. at 302 , 503 A.2d 1313 ). The Court held that because of the relationship between the parties, a jury could have found that the King children were not on notice of a potential claim against Brown.

In Supik, 152 Md.App. at 704 , 834 A.2d 170 , the plaintiffs were represented by the defendant in a toxic tort litigation against two exterminators who had treated the plaintiffs’ home. Over the course of the three years the defendant represented them, the parties would occasionally disagree regarding a course of action or, in more extreme instances, the defendant would act contrary to the plaintiffs’ wishes. Id. at 705-08 , 834 A.2d 170 . Eventually, they settled the toxic tort case but subsequently, the plaintiffs learned that the settlement was for an amount significantly less than it likely was worth.

Id. at 708 , 834 A.2d 170 . As a result, the plaintiffs filed a legal malpractice action against the defendant. Id. In ⁵⁵⁵ response, the defendant moved for summary judgment using the statute of limitations as its defense.

The circuit court granted summary judgment, finding that the plaintiffs were on inquiry notice of malpractice before the settlement occurred. Id. at 709 , 834 A.2d 170 . The plaintiffs appealed. On appeal, citing Frederick Road , we observed that “Maryland’s appellate courts have repeatedly stated that the determination of when a cause of action “accrues” under § 5-101 of the Courts and Judicial Proceedings Article is one left to the court for judicial determination.” Supik at 710, 834 A.2d 170 .

We then explained that “[w]e read O’Hara and Frederick Road directing that only when there is no genuine dispute of material fact as to when the action accrued, should a trial court grant summary judgment on the basis of limitations; otherwise, the question is one of fact for the trier of fact.” Id. at 710-11, 834 A.2d 170 (emphasis in original). We also noted that when credibility of witnesses or weight of evidence is at issue, the question is one for the jury to resolve. Id. Next, we reviewed some of the instances when the statute of limitations may be tolled, including fraud. “The fraud exception is essentially a tangent of the discovery rule.

If an adverse party fraudulently conceals knowledge of a cause of action, ‘the cause of action shall be deemed to accrue at the time when the party discovered, or by the exercise of ordinary diligence should have discovered the fraud.’ ” Id. at 715 , 834 A.2d 170 (quoting [Cts. & Jud. Proc.] § 5-203). We considered that there was some dispute between the parties over whether any of the prior disagreements or the defendant’s acts against the will of the plaintiffs constituted notice. The defendant claimed that they should have been on inquiry notice of a potential malpractice action before the settlement and at latest when the settlement occurred.

The plaintiffs argued that they did not have notice until well after the settlement, thereby tolling the statute of limitations. Id. at 720, 834 A.2d 170 . We held: Because the ordinary principles governing summary judgment continue to apply when the issue is summary judgment on grounds of limitations, and because there does exist, in this case, a genuine dispute of material fact, we ⁵⁵⁶ hold that the trial court erred as a matter of law in granting [the defendant’s] motion for summary judgment. Id. at 722 , 834 A.2d 170 .

Returning to the case at bar, the question was whether appellants were on inquiry notice that the Bridge Loan Program did not exist and that appellants were fraudulently representing that it did. Appellees contend that the inclusion of false gross rental income on Form 1003 should have indicated some level of fraudulent activity. Although we are not persuaded that one mention of false income on a loan application form is necessarily notice that the Bridge Loan Program did not exist, we will not decide that issue. Our inquiry is whether it is a question of law for the court or a question of fact for the jury if appellants were reasonably on notice.

As Maryland courts have held, summary judgment is appropriate when statute of limitations is at issue, if there is no dispute of material fact. However, there could be instances when accrual involves questions of fact and law. This case is one such instance. Akin to Dashiell and Frederick Road , the parties dispute if there were acts that were sufficient to trigger notice in a reasonable person.

Additionally, there appears to be some dispute regarding whether the Form 1003 was fraudulent in some way because of appellants’ discovery that other leases had been forged. Appellants never affirmatively recalled seeing the gross rental income on the Form. As such, the court’s decision that gross rental income should have put them on notice involved the credibility of their testimony. As we explained in Supik , when credibility is at issue, the question is one to be decided by the finder of fact.

We conclude that there were genuine disputes of material fact and therefore, the circuit court erred in granting summary judgment. 2. Did the circuit court err in granting summary judgment as to the Banking Appellants’ SMLL claims? Before the circuit court, appellants alleged violations of Maryland Code, (1975 Repl.Vol.2013), § 12-403 of the Commercial Law Article [hereinafter Com. Law], known as the ⁵⁵⁷ Secondary Mortgage Loan Law (“SMLL”).

Recently, the Court of Appeals provided a review of the SMLL’s background in the opinion of Thompkins v. Mountaineer Investments, LLC, 439 Md. 118, 123-27 , 94 A.3d 61 , 2014 WL 2808066 (2014). The SMLL is a consumer protection measure that was designed to incorporate, complement, and prevent circumvention of the usury laws by limiting the interest, fees, and other charges that a lender could collect from a borrower as part of a second mortgage loan on a residential property.... The SMLL is codified at Maryland Code, Commercial Law Article (“CL”), § 12-401 et seq. It sets forth certain requirements that must be followed when a lender[ ] extends a secondary mortgage loan to a borrower and also restricts in certain respects the terms of the loan....

The statute includes various other consumer protection provisions, including prohibitions against false advertising regarding the availability of secondary mortgage loans, against age discrimination in the granting of such loans, and against loan provisions that require the debtor to waive the protections of the SMLL. CL §§ 12-403, 12-403.1, 12-409. The statute generally prohibits a lender from offering or making a secondary mortgage loan that is not in compliance with the SMLL and, more specifically, from “directly or indirectly” charging or receiving fees forbidden by the statute. CL §§ 12-411, 12-412.

Finally the SMLL provides for both civil and criminal enforcement. CL §§ 12-413, 12-414. The civil remedy provision reads as follows: Except for a bona fide error of computation, if a lender violates any provision of [the SMLL] he may collect only the principal amount of the loan and may not collect any interest, costs, or other charges with respect to the loan. In addition, a lender who knowingly violates any provision of [the SMLL] also shall forfeit to the borrower three times the amount of interest and charges collected in excess of that authorized by law.

CL § 12-413. Thus, a lender who violates the SMLL is limited ⁵⁵⁸ to collecting the principal amount of the loan and is not entitled to collect any interest or other charges. If the violation is “knowing,” the borrower can recover a form of treble damages from the lender. Following the circuit court’s grant of summary judgment as to counts I to IX and XI, the Banking Appellees moved for summary judgment as to count X, the alleged SMLL violations.

During the prior motion for summary judgment, the parties had agreed that the applicable statute of limitations for the SMLL count was twelve years, so the count was not barred. However, PNC was not a party to the prior motion for summary judgment and as a result, in its motion contended that the SMLL count was subject to a three year statute of limitations under Cts. & Jud. Proc. § 5-201. Appellants argued before the trial court that the Banking Appellees had violated the SMLL by falsely advertising the existence of a non-contingent Bridge Loan Program.

The circuit court granted summary judgment, after finding that the SMLL did not apply to Ms. Matthews or Ms. Windesheim because they were not lenders; that the communications with Michelle Matthews did not qualify as advertising under the statute; and that the statute was not intended to regulate the type of conduct performed by the Banking Appellees. On appeal, appellants argue the circuit court erred because by advertising that a nonexistent Bridge Loan Program was an option, appellees had falsely advertised loan availability in violation of the SMLL. They also posit that Ms. Matthews and Ms. Windesheim qualify as lenders under the SMLL and that the court erred in its determination concerning the penalties that appellees would be required to pay. Additionally, PNC maintains that the SMLL claim is barred by limitations and that in the alternative, there is no evidence that it violated the SMLL.

As a preliminary note, the SMLL applies only to secondary mortgages, and therefore, in the instant case, is only applicable to appellants’ HELOCs. While the Banking Appellees are comprised of five entities, the SMLL claim could only apply to ⁵⁵⁹ those parties involved with the HELOCs. Thus, Prosperity and Wells Fargo are not subject to the SMLL because they are parties to this action as a result of their involvement with the primary purchase money loans. PNC provided the HELOCs and Ms. Windesheim was the loan officer for PNC, therefore, both of these parties could be subject to the SMLL.

Lastly, Ms. Mathews was the loan officer for Prosperity, which was not covered by the SMLL, but appellants contend that she participated in advertising the Bridge Loan Program, which involved the HELOC. Accordingly, of the five Banking Appellees, we shall consider liability only as to the latter three parties. Finally, appellants contend that due to appellees’ actions, their old homes were on the market for a considerable period of time, during which they incurred fees and other charges that they would not have incurred but for the Bridge Loan Program. If appellees are liable under the SMLL, as noted supra, appellants could recover up to three times the amount of any interest or other costs associated with the loan.

See Com. Law § 12-413. a. Is the SMLL claim subject to a twelve year statute of limitations? Courts & Judicial Proceedings § 5-102 provides: (a) Twelve-year limitation.—An action on one of the following specialties shall be filed within 12 years after the cause of action accrues, or within 12 years from the date of the death of the last to die of the principal debtor or creditor, whichever is sooner: (1) Promissory note or other instrument under seal; (2) Bond except a public officer’s bond; (3) Judgment; (4) Recognizance; (5) Contract under seal; or (6) Any other specialty.

PNC maintains that the traditional three year statute of limitations applies to the SMLL claim because it does not fall under any of the speciality exceptions of Cts. & Jud. Proc. ⁵⁶⁰ § 5-102. Master Financial, Inc. v. Crowder, 409 Md. 51 , 972 A.2d 864 (2009) [hereinafter Crowder ], was a case in which the Court of Appeals addressed whether a claim brought under several provisions of the SMLL 4 was subject to the twelve year specialty statute of limitations. There, several borrowers brought class actions against several lenders asserting violations of the SMLL and the Consumer Protection Act.

Id. at 56 , 972 A.2d 864 . The trial court dismissed the action, reasoning that the SMLL claims were barred by the three year statute of limitations. Id. The Court of Appeals granted certiorari and although neither side argued that the SMLL claims were subject to a twelve year statute of limitations, the Court directed the parties to address the issue.

Relying on Greene Tree H.O.A. v. Greene Tree Assoc., 358 Md. 453 , 749 A.2d 806 (2000) and the line of cases which followed, the Court explained the criteria for a claim to be considered a speciality. Acknowledging that the lawsuits were not seeking to enforce the loans and that all of the claims arose entirely under the SMLL, the Court reasoned that the determination of whether the twelve year limitation applied depended upon whether the SMLL claims were an “other specialty.” The Court explained that in order to satisfy that determination, it had to decide if: (1) the duty, obligation, prohibition, or right sought to be enforced is created or imposed solely by the statute, or a related statute, and does not otherwise exist as a matter of common law; (2) the remedy pursued in the action is authorized solely by the statute, or a related statute, and does not otherwise exist under the common law; and (3) if the action is one for civil damages or recompense in the nature of civil damages, those damages are liquidated, fixed, or, by applying clear statutory criteria, are readily ascertainable; Crowder, 409 Md. at 70 , 972 A.2d 864 . The Court noted that the duties and obligations were solely a product of the SMLL ⁵⁶¹ and that the Com. Law § 12-413 provided remedies that could only be recovered under the statute and they were fixed and ascertainable.

Id. at 72, 972 A.2d 864 . PNC asserts that the SMLL claim under Com. Law § 12-403 fails the first prong of the speciality analysis because it already exists at common law, specifically as fraud and negligent misrepresentation. We conclude that a claim brought under Com.

Law § 12-403 is a specialty and subject to the twelve year statute of limitation. We find the Court of Appeals decision in AGV Sports Group, Inc. v. Protus IP Solutions, Inc., 417 Md. 386 , 10 A.3d 745 (2010), is instructive. There, the plaintiffs brought suit asserting violations of the Maryland and federal Telephone Consumer Protection Acts (“TCPA”). Id. at 389 , 10 A.3d 745 .

The federal District Court of Maryland certified a question to the Court of Appeals, instructing it to decide if a claim under the Maryland TCPA was a statutory specialty. Id. at 390 , 10 A.3d 745 . The defendant advanced several arguments in support of its claim that the TCPA was not a specialty, among which was the assertion that the first prong of the specialty analysis was not satisfied. Id. at 397 , 10 A.3d 745 .

The defendant contended that the same rights protected under the TCPA could also be pursued under the common law actions of conversion and trespass to chattels and that in addition, the TCPA permitted a plaintiff to recover unliquidated damages, which violated the third prong. Id. The Court agreed with the defendant, and reasoned that the common law actions were sometimes pursued along with TCPA claims. The Court also explained that the TCPA expressly permitted a plaintiff to recover liquidated damages, pursuant to the statute, and unliquidated damages that could be recovered under the common law.

Returning to the instant case, we find the facts of AGV distinguishable. Appellants could have pursued a lawsuit under common law fraud and negligent misrepresentation. However, considering the intent of the legislature in enacting the SMLL, the claims are different. The SMLL was enacted to protect the unsophisticated buyer and “achieves this beneficent purpose by penalizing even the unwitting violator, to the ⁵⁶² extent of limiting him to recovery of the principal amount of the loan.” Thomkinson v. Mortgage Lenders Network USA, Inc., 209 Md.App. 685, 696 , 61 A.3d 829 (2013) (quoting Duckworth v. Bernstein, 55 Md.App. 710, 724 , 466 A.2d 517 (1983)).

The common law claims of fraud and negligent misrepresentation must be established by demonstrating that the perpetrator knowingly or intentionally committed them. 5 Under the SMLL, even an “unwitting violator” can be held liable, indicating that the legislature wanted to expand and not restrict the rights under the common law. A comparison of Com. Law § 12-413 with Com. Law § 12-403, provides further support that the SMLL is different from fraud and negligent representation.

Com. Law § 12-413 permits additional recovery by a plaintiff if they can establish that the lender acted knowingly; indicating that one can be liable under § 12-403 without acting intentionally. Additionally, unlike the case in AGV, wherein the TCPA provided for liquidated damages but also permitted unliquidated damages, the SMLL only allows a plaintiff to recover interest, costs and ⁵⁶³ other charges related to the loan. Com.

Law § 12-413. Our conclusion that a claim under Com. Law § 12-403 is a specialty statute, is consistent with the Court of Appeals’ holdings in Crowder and AGV. b. Are Ms. Matthews, Ms. Windesheim or PNC