Len Stoler, Inc. v. Wisner

HOTTEN, J. A creditor brought suit against an automobile dealer challenging the dealer’s retention of certain fees and charges associated with the purchase of a vehicle, alleging violations of the Maryland Closed-End Credit Grantor Law. The car dealer moved for summary judgment, which was denied by the Circuit Court for Baltimore County. The court also granted the creditor’s motion for partial summary judgment. In the order the court stated: “[t]o the extent that this Order is not a ²²¹ final judgment, this court expressly determines, pursuant to Maryland Rule 2-602(b) that there is no just reason for delay, and this otherwise final Order should be entered as a final judgment, notwithstanding that it adjudicates fewer than all of the claims at issue in this action.” On appeal, the dealer presents three questions for our review: 1.

Whether the [circuit [c]ourt erred when it determined that Maryland’s Closed-End Credit Grantor Law, [Md.Code Ann. Comm. Law], § 12-1001, et. seq. (“CLEC”), prohibited [Len Stoler Inc.,] from collecting and retaining the [electronic titling fee], despite express permission to do so in [Md.Code Ann., Transp.] § 13-610 and [Md.Code Regs.] 11.12.01.23(A) & (B)? 2. Whether the [c]ircuit [c]ourt erred when it held, implicitly, that [appellee] had standing to sue for the alleged injury caused by [Len Stoler Inc.J’s retention of the Tax Allowance, notwithstanding that [appellee] had no rights to the funds and that the funds collected would otherwise have gone to the State and not to [appellee]? 3.

Whether the [circuit [c]ourt erred when it determined that Maryland’s Closed-End Credit Grantor Law, [Md.Code Ann. Comm]. Law, § 12-1001, et seq., prohibited [Len Sto-ler Inc.,] from collecting and retaining the Tax Allowance despite express permission to do so in [Md.Code Ann., Transp.] § 13-812? For the reasons that follow, we shall reverse the judgment of the circuit court. FACTUAL AND PROCEDURAL HISTORY On March 30, 2011, appellee, Tracy Wisner, purchased a 2011 Lexus from appellant, Len Stoler, Inc., (“LSI”), an automobile dealer, for $51,867.50.

Appellee traded in a Jeep she owned in lieu of a down payment, and financed the remainder through Toyota Credit Motor Corporation. Appel-lee signed a sales contract that was a standard form document LSI used for all purchases. The contract included an itemized list of all charges including: a $4.00 charge for taxes paid to ²²² government agencies; a $220.00 charge for government registration fees; and a $50.00 charge for government certification of title fees. Two years later, appellee filed a putative class action lawsuit against LSI alleging causes of action related to the three charges referenced above.

In her original complaint, she asserted that LSI had overcharged her $104 for the fees. LSI explained that out of the $220 in government registration fees, it had only actually incurred $140 in fees and accordingly, sixteen days after appellee purchased the vehicle, on June 15, 2011, it issued her an $80 refund which appellee accepted and deposited within days of receipt. As a result of this realization, appellee amended her complaint, alleging that LSI had improperly collected $24, had double charged her this amount and improperly retained the fee in violation of the Credit Grantor Closed End Credit Provisions (“CLEC”). LSI moved for summary judgment, asserting that it was authorized by the Transportation Article to collect the retained $24.

Additionally, it argued that appellee was incorrect in her assertion that she had been double charged the $24 and ascribed the confusion to appellee misreading the sales documents. LSI averred that appellee confused a separate $24 fee, which consisted of the $4 tire recycling fee and the $20 electronic titling fee. In her opposition to LSI’s motion for summary judgment, appellee altered her argument slightly: she no longer claimed that she had been double charged the $24 tax allowance, but rather asserted that LSI had violated CLEC by improperly retaining the $24 tax allowance and the collected $20 electronic titling fee—bringing the total amount she alleged she was overcharged to $44. The court held a hearing on the motion and a cross motion for summary judgment filed by appellee on March 26, 2014 and after both parties argued, the court adjourned to review two cases brought to its attention, Biggus v. Ford Motor Credit Co., 328 Md. 188 , 613 A.2d 986 (1992) [hereinafter Biggus ] and Ford Motor Credit Co. v. Roberson, 420 Md. 649 , 25 A.3d 110 (2011) [hereinafter Roberson ].

The hearing resumed on April 23, 2014 and, following additional argu ²²³ ments, the court granted appellee’s motion for partial summary judgment, and denied LSI’s motion for summary judgment, ruling that the CLEC prohibited LSI from charging appellee either the $20 electronic titling fee or the $24 charge for collecting excise taxes. 1 LSI noted an appeal several days later. Additional facts will be presented, to the extent they prove relevant in addressing the issues on appeal. 2 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. We review a circuit court’s grant or denial of summary judgment de novo.

See Haas v. Lockheed Martin Corp., 396 Md. 469, 479 , 914 A.2d 735, 741 (2007). In reviewing the grant of a motion for summary judgment, appellate courts focus on whether the circuit court’s grant of the motion was legally correct. Laing v. Volkswagen of Am., Inc., 180 Md.App. 136, 152-53 , 949 A.2d 26 (2008) (citations omitted). CERTIFICATION FOR FINAL JUDGMENT Before considering the merits of this appeal, we must engage in a jurisdictional inquiry, specifically, whether the circuit court was correct in certifying its summary judgment ruling as a final order.

Although neither party raised this issue in their briefs, we note that if certification was improper, the appeal must be dismissed for lack of jurisdiction. See ²²⁴ Huber v. Nationwide Mut. Ins. Co., 347 Md. 415, 419 , 701 A.2d 415 (1997) (declining to address the merits of an appeal predicated on the lack of jurisdiction as a result of the circuit court improperly certifying its declaratory judgment as a final judgment).

See also Shofer v. Stuart Hack Co., 107 Md.App. 585, 591 , 669 A.2d 201 (1996) (addressing the circuit court’s certification of a final judgment even though neither party raised the issue on appeal, and explaining that appellate courts cannot exercise subject matter jurisdiction over an appeal unless there was a properly entered final judgment before the circuit court). We review a circuit court’s entry of a final judgment pursuant to Maryland Rule 2-602 de novo, and accordingly, we give no deference to the circuit court’s findings. Id. at 591 , 669 A.2d 201 . In the case at bar, the parties filed cross motions for summary judgment and appellee filed a motion for class certification.

Following oral arguments on the cross motions, the circuit court denied appellant’s motion and granted appellee’s partial motion for summary judgment. Regarding the class certification motion, the following colloquy occurred: THE COURT: Now, the next part of this case is the [appellee’s] request to have the class certified. I try to be a practical judge and I suspect I’m not the last word on this case and it seems to me that if Len Stoler intends to appeal this case on my decision, I believe it is prudent and more efficient with considering all the possible costs involved that this be considered an appealable order at this time before we go down the road of class certification. [APPELLANT’S COUNSEL]: Thank you, Your Honor. That is Len Stoler’s intention.

THE COURT: So I believe that is the prudent way to proceed. Did you wish to be heard on that, [appellee’s counsel]? [APPELLEE’S COUNSEL]: No, Your Honor. That’s fine. THE COURT: I mean, it might save you money in the long run, too, or expense. ²²⁵ [APPELLEE’S COUNSEL]: I agree.

We want to know the ultimate answer. The court later issued its order, ruling in part “[t]o the extent that this Order is not a final judgment, this [c]ourt expressly determines, pursuant to Maryland Rule 2-602(b) that there is no just reason for delay, and this otherwise final Order should be entered as a final judgment, notwithstanding that it adjudicates fewer than all of the claims at issue in this action.” The “final judgment rule” is codified in the Maryland Code, (1974 Repl.Vol.2013) Courts & Judicial Proceedings § 12-301, which provides that “a party may appeal from a final judgment entered in a civil or criminal case by a circuit court. The right of appeal exists from a final judgment entered by a court in the exercise of original, special, limited, statutory jurisdiction, unless in a particular case the right of appeal is expressly denied by law.” The Court of Appeals has explained that there are only three exceptions to the final judgment rule: Rather, we have made clear that the right to seek appellate review of a trial court’s ruling ordinarily must await the entry of a final judgment that disposes of all claims against all parties, and that there are only three exceptions to that final judgment requirement: appeals from interlocutory orders specifically allowed by statute; immediate appeals permitted under Maryland Rule 2-602; and appeals from interlocutory rulings allowed under the common law collateral order doctrine. Salvagno v. Frew, 388 Md. 605, 615 , 881 A.2d 660 (2005).

Maryland Rule 2-602 provides: (a) Generally. Except as provided in section (b) of this Rule, an order or other form of decision, however designated, that adjudicates fewer than all of the claims in an action (whether raised by original claim, counterclaim, cross-claim, or third-party claim), or that adjudicates less than an entire claim, or that adjudicates the rights and liabilities of fewer than all the parties to the action: (1) is not a final judgment; ²²⁶ (2) does not terminate the action as to any of the claims or any of the parties; and (3) is subject to revision at any time before the entry of a judgment that adjudicates all of the claims by and against all of the parties. (b) When Allowed. If the court expressly determines in a written order that there is no just reason for delay, it may direct in the order the entry of a final judgment: (1) as to one or more but fewer than all of the claims or parties; or (2) pursuant to Rule 2—501(f)(3), for some but less than all of the amount requested in a claim seeking money relief only.

In Shofer, supra, the plaintiff sued his former accountants, alleging that as a result of their financial advice, he incurred more than $100,000 in state and federal tax penalties. 107 Md.App. at 589 , 669 A.2d 201 . His case was dismissed and following an appeal before the Court of Appeals, the matter was remanded for trial. Id. at 590 , 669 A.2d 201 . Before the circuit court prior to trial, there were three separate orders issued in response to various motions, all ruling against the plaintiff.

Id. At a pre-trial conference, the plaintiff expressed that he planned on appealing the three orders regardless of the outcome of the trial. Id. at 591 , 669 A.2d 201 . Therefore, the circuit court certified the three orders as final judgments so that the plaintiff could appeal to this Court.

Id. On appeal, we sua sponte addressed whether the circuit court’s certification of the three orders as final judgments was improper. Id. at 592 , 669 A.2d 201 . We opined: Rule 2-602 is not a conduit for trial judges to certify any interlocutory order as a final judgment so as to acquire an advisory opinion from this Court on a pressing legal issue.

The certification process is “limited to orders which, by their nature, have a characteristic of finality. Such orders must be completely dispositive of an entire claim or party.” Snowden v. Baltimore Gas & Electric, 300 Md. 555, 563 , 479 A.2d 1329 (1984); see also Pearlstein v. Maryland Deposit ²²⁷ Ins., 79 Md.App. 41, 51 , 555 A.2d 528 (1989) (stating that “[a]n order that merely resolves an issue within a claim rather than an entire claim may not be certified pursuant to this rule”). A trial judge should only certify orders for final judgment in extraordinary circumstances and in an effort to prevent “sufficient hardship or unfairness.” Planning Bd. v. Mortimer, 310 Md. 639, 648 , 530 A.2d 1237 (1987). Id. at 594 , 669 A.2d 201 .

We continued, noting that our first inquiry was whether the order disposed of an entire claim. Id. The second inquiry was whether “no just cause for delay” existed. Id.

Regarding the “no just cause for delay” requirement, we listed four factors that may be considered, whether a delay of appeal: 1) would create a “harsh impact” on the litigants, including an economic impact; 2) would create a risk that the same issues would be raised in subsequent appeals; 3) “whether disposition of the remaining claims might moot the need for an immediate appeal”; and 4) if an appeal would result in the appellate court deciding questions still before the trial court. Id. at 595 , 669 A.2d 201 . We concluded that the three orders did not dispose of entire claims and that based on the record, it was not established that there was no just cause to delay the appeal process. Id. at 596 , 669 A.2d 201 .

Accordingly, we dismissed the appeal. Id. In the ease at bar, we conclude that both requirements to certify a final judgement under Md. Rule 2-602 were met. The denial of appellant’s summary judgment and grant of appellee’s motion for partial summary judgment resolved the claims raised in appellee’s complaint—specifically that appel-lee had violated CLEC by retaining the two fees. 3 Accordingly, this ruling meets the threshold required to permit certification of a judgment as a final judgment.

Next, the court’s ²²⁸ order reasoned that there was no just reason for delay, and we agree. Cf. Tyrone W. v. Danielle R., 129 Md.App. 260, 270 , 741 A.2d 553 (1999) (holding that the certification of final judgment under Md. Rule 2-602(b) was improper where the circuit court failed to express a finding of “no just reason for delay.”). Following the court’s summary judgment ruling, the remaining issue was appellee’s outstanding class certification motion.

The circuit court explained in its oral ruling that it was prudent and efficient, in terms of both time and money, to permit an appeal without delay. Some reasons that this Court and the Court of Appeals have held can be permissible to justify certification of a final order are to avoid “duplication of efforts and costs in cases” and to avoid the “potential that delay of the appeal may work an economic hardship upon one or more of the parties.” Gress v. ACandS, Inc., 150 Md.App. 369, 381 , 820 A.2d 616 (2003). Considering the four factors enumerated in Shofer , we find that delay of this appeal would have imposed a harsh impact on the litigants, namely, the economic impact of litigating the class certification motion. Next, we find that it is a near certainty that this same issue would be considered in a subsequent appeal.

Appellant’s collection and retention of the fees was the entire basis of the lawsuit, therefore, appellants would certainly appeal this circuit court’s ruling that they violated CLEC by retaining the fees. Disposition of the remaining claim, specifically the class certification motion, would not moot the need for an intermediate appeal. Even if the court denied the class certification motion, it had still ruled that appellant had violated CLEC. Finally, this Court’s consideration of the appeal would not require that we determine issues still before the trial court.

We find that there was no just cause for delaying an appeal, especially considering our conclusion and the impact that this case has on Maryland consumers, automobile dealers, and the Motor Vehicle Administration. See Bessette v. Weitz, 148 Md.App. 215, 233-34 , 811 A.2d 812 (2002) (finding that there was no reason to delay an appeal predicated on this Court’s findings regarding the circuit court’s certification and considering our conclusions on the merits of the case). ²²⁹ Accordingly, we find that the circuit court did not err in certifying its summary judgment order as a final judgment pursuant to Maryland Rule 2-302(b), and shall now turn to the merits of this case. DISCUSSION In 1983, the General Assembly enacted the Credit Grantor Closed End Credit Provisions (“CLEC”), codified in Maryland Code, Commercial Law Article § 12-1001 et seq. [hereinafter Com. Law] It governs closed end credit transactions and regulates interest rates, charges, default and other aspects of a credit transaction.

Com. Law § 12-1005(b) permits a dealer to collect reasonable fees for services rendered in connection with a loan. (b) Reasonable fees for services rendered or for reimbursement of expenses incurred in good faith by the credit grantor or its agents in connection with the loan, including: (1) Commitment fees; (2) Official fees and taxes; (3) Premiums or other charges for any guarantee or insurance protecting the credit grantor against the borrower’s default or other credit loss; (4) Costs incurred by reason of examination of title, inspection, recording, and other formal acts necessary or appropriate to the security of the loan; (5) Filing fees; (6) Attorney’s fees; and (7) Travel expenses. However, if the loan is taken out by a consumer borrower, Com.

Law § 12—1005(d) prohibits a dealer from collecting the fees enumerated in subsection (b). (d)(1) In the case of a loan to a consumer borrower, a fee permitted under subsection (b) of this section may not be charged and collected unless: (i) The agreement, note, or other evidence of the loan permits; ²³⁰ (ii) The fee is an actual and verifiable expense of the credit grantor not retained by him; and (iii) Limited to charges for: 1. Attorney’s fees for services rendered in connection with the preparation, closing, or disbursement of the loan; 2. Any expense, tax, or charge paid to a governmental agency; 3.

Examination of title, appraisal, or other costs necessary or appropriate to the security of the loan; and 4. Premiums for any insurance coverage permitted under this subtitle. Appellee alleges that pursuant to the language of CLEC, LSI improperly retained both an electronic titling fee and an excise tax allowance. In response, LSI argues that while CLEC is the applicable law, the Transportation Article explicitly permits it to collect and retain both amounts.

Maryland Code, Transportation Article [hereinafter Transp.] (1977 Repl.Vol.2012) § 13-610 permits a dealer to issue permanent registration plates to a buyer by electronically transmitting the registration to the MVA and to charge the buyer a fee for doing so. This is the electronic titling fee. 4 The Code of Maryland Regulations (“COMAR”) 11.12.01.23 provides that this fee may be no more than $20 and that the dealer may retain the fee, as opposed to forwarding it to the MVA. Likewise, Transp. § 13-812 permits a dealer to keep $24 of the excise tax it collects for the State. 5 LSI contended that these two provisions created exceptions to the general requirements of CLEC. ²³¹ 1. Electronic Titling Fee LSI argues that the circuit court erred when it found that CLEC prohibited it from collecting and retaining the electronic titling fee, notwithstanding the fact that Transp. § 13-610 authorizes a dealer to collect and retain the fee.

Appellee responds in her brief that LSI is miseharacterizing the court’s finding and that in