Lucky Ned Pepper's Ltd. v. Columbia Park & Recreation Ass'n

²²⁵ ALPERT, Judge. Trial by jury has been described as “the only anchor ever yet imagined by man, by which a government can be held to the principles of its constitution.” 1 In this appeal we explore the extent to which the right to a jury trial may be curtailed. Because of such curtailment, in this appeal the constitutionality of one of Maryland’s rent escrow statutes is challenged. Specifically, appellant challenges Maryland Real Property Code Ann. § 8-118 (1981 Repl.Vol., 1984 Cum.Supp.) 2 which provides, in pertinent part: Rent escrow account in certain landlord-tenant actions.

(a) Tenant to pay rents into account. — In an action under § 8-401, § 8-402, or § 8-402.1 of this article in which a party prays a jury trial, the District Court shall enter an order directing the tenant or anyone holding under the tenant to pay all accrued and unpaid rents, and all rents due and as they come due during the pendency of the action, as prescribed in subsection (b) of this section. (b) Escrow accounts into which rents to be paid. —The District Court shall order that the rents to be paid into the registry of an escrow account of: (1) The clerk of the circuit court; or (2) If directed by the District Court, an administrative agency of the county which is empowered by local law to hold rents in escrow pending investigation and disposition of complaints by tenants. (c) Failure to pay rent. — In an action under § 8-401, § 8-402, or § 8-402.1 of this article, if the tenant or anyone holding under the tenant fails to pay rent accrued or as it comes due pursuant to the terms of the order, the circuit court, on motion of the landlord and certification ²²⁶ of the clerk or agency of the status of the account, shall give judgment in favor of the landlord and issue a warrant for possession. (emphasis added).

FACTS The appellant is Lucky Ned Pepper’s, Ltd. (“Lucky Ned”), a tenant of appellee, Columbia Park and Recreation Association. Lucky Ned operates the bar and restaurant at the Allview Golf Course in Howard County, Maryland. This appeal arises out of appellee’s suit filed in the District Court of Maryland for Howard County requesting possession of and accrued rent on the area of the golf course clubhouse occupied by appellant. The action was filed under § 8-401 of the Real Property Code, providing for summary eviction proceedings based upon a tenant’s failure to pay rent.

At the scheduled trial date, July 9, 1984, appellant prayed a jury trial. Following the prayer for jury trial, the District Court (through appellee’s counsel) requested that appellant show cause within two (2) days, as to why appellant ought not be ordered to pay, into escrow, accrued rents on the property pursuant to § 8-118(a) of the Real Property Code. On July 10th appellant responded, by letter, to the judge’s request, indicating that § 8-118 ought not be applied in this case because (1) it is unconstitutional and (2) “the amount claimed [by appellee] is a shameful fraud.” Finally, appellant’s counsel requested “to be heard in order to lay bare the fraudulent Statement of Claim.” On July 11th, apparently without ever having seen appellant’s correspondence of July 10th, the district court judge ordered appellant to pay $6,710.66 into escrow. This sum represents the amount allegedly owed by appellant, exclusive of late charges and attorney’s fees, as sworn to in appellee’s original statement of claim.

Appellant was also ordered to pay into escrow future rents as they became due. Appellant was given two days to comply with this order. ²²⁷ Pursuant to the prayer for jury trial, this case reached the Circuit Court for Howard County on July 16, 1983. In the meantime, appellant paid no money into escrow and on July 19th promptly moved to strike the district court’s July 11th order. The motion was based upon three grounds: (1) that § 8-118 of the Real Property Code was unconstitutional; (2) that even if constitutional, § 8-118 did not apply; and (3) that the amount of rent claimed by appellee was fraudulent.

Appellant also requested a hearing on this motion. In September, appellee moved for judgment against appellant pursuant to § 8-118(c) which provides that “[i]n an action under § 8-401 ... if the tenant ... fails to pay rent accrued or as it becomes due pursuant to the terms of the order, the circuit court, on motion of the landlord, ... shall give judgment in favor of the landlord----” Appellee also requested a hearing on this motion. On November 11, 1984, the Circuit Court for Howard County heard arguments on the pending motions including appellant’s motion to strike the escrow order. At the hearing appellant again claimed that § 8-118 was unconstitutional and that, in any event, it was denied due process by the district court’s failure to afford him a hearing prior to its July 11th order.

From the bench, the circuit court judge ruled that § 8-118 was constitutional and that appellant was not denied due process by virtue of the July 11th order. He then granted appellee’s motion for judgment which included all rents that had accrued as of the district court proceeding plus rents that were accruing and had accrued to October 20, 1984, a total of $9,210.66. He denied appellant’s motion to strike the district court order. Orders to this effect were filed on November 8, 1984, and November 13, 1984, respectively.

An appeal was taken November 8, 1984. 3 ²²⁸ I. Section 8-118 of the Real Property Code is alleged to be repugnant to articles 23 and 24 of the Maryland Declaration of Rights. These articles provide: Article 23: The right of trial by Jury of all issues of fact in civil proceedings in the several courts of law in this State, where the amount in controversy exceeds the sum of five hundred dollars, shall be inviolably preserved. Article 24: That no man ought to be taken or imprisoned or disseized of his freehold, liberties or privileges, or outlawed, or exiled, or, in any manner, destroyed, or deprived of his life, liberty or property but by the judgment of his peers, or by the Law of the Land. Specifically, appellant argues: (1) that § 8-118 interferes with the exercise of one’s right to a jury trial, and (2) that subsections (a) and (c) of § 8-118 violate one’s due process rights because they provide for the payment of money and entry of a judgment without providing for a hearing.

II

A. Interference with Jury Trial Right “Before a statute may be declared unconstitutional ‘its repugnancy to the provisions or necessary implications of the Constitution should be manifest and free from all rea ²²⁹ sonable doubt.’ ” Att’y Gen’l v. Johnson, 282 Md. 274, 281 , 385 A.2d 57 (1978) (quoting Baltimore v. State, 15 Md. 376, 475 (1860)). In this appeal it is alleged that § 8-118 is repugnant to Article 23 of the Maryland Declaration of Rights because (1) it impermissibly encroaches upon the function of a jury and (2) it places a premium upon the exercise of the right to a civil jury trial. While the right to trial by jury in civil actions remains inviolate in this State, it does so only to the extent that it existed at common law. See Knee v. Baltimore City Passenger Ry.

Co., 87 Md. 623 , 40 A. 890 (1898). Consequently, we must carefully scrutinize any curtailment of that right. The Court of Appeals has already recognized that the right may be subject to reasonable regulations. See Bringe v. Collins, 274 Md. 338 , 335 A.2d 670 (1975).

Our task, therefore, is to decide if § 8-118 is a reasonable regulation of this right. Appellant suggests it is an unreasonable one because it “obliterates the ultimate function of the jury and renders the Constitution inoperable.” Specifically, appellant complains that if the district court orders an escrow payment of accrued and unpaid rents due, it requires a predetermination of the ultimate issue committed to a circuit court jury, i.e., what money is owed the landlord. Additionally, appellant asserts that § 8-118 unreasonably requires a party praying a jury trial to pay for the exercise of this right. Initially, we observe that under § 8-118 the district court may order an escrow of past due (accrued) rents and future (accruing) rents.

Inasmuch as the statute contemplates two separate orders we may hold the statute only partially unconstitutional. In that case those portions which are unconstitutional are without legal effect and may be severed from the remaining constitutional portions. See Turner v. State, 299 Md. 565 , 474 A.2d 1297 (1984). There is a presumption that, “even in the absence of an express clause or declaration, that a legislative body generally intends its enactments to be severed if possible.” Turner, ²³⁰ 299 Md. at 576 , 474 A.2d 1297 .

Unless excision of the unconstitutional portion of a statute renders the same meaningless or there is evidence of a legislative intent not to sever, we will infer severability. See Turner v. State, 299 Md. 565 , 474 A.2d 1297 (1984) (legislative intent); Davidson v. Miller, 276 Md. 54, 83 , 344 A.2d 422 (1975). In the case sub judice we find no legislative intent to preclude severance of the statute at issue, § 8-118. Nor do we believe that the two orders are so intertwined that the statute becomes meaningless if only one is deemed an unconstitutional infringement of the right to a jury trial.

Therefore, we will address the constitutionality of these orders separately. Past Due (Accrued) Rents We agree with appellant that this statute, to the extent that it provides for an escrow of past due rents, amounts to more than merely a reasonable regulation of one’s right to a jury trial. We believe that it interferes with this right to the extent that the right becomes meaningless. We explain.

Requiring the tenant to escrow “all accrued and unpaid rents and all rents due” presupposes a determination that the money is owed. “The word due always imports a fixed and settled obligation or liability____” Black’s Law Dictionary (5th ed. 1979) p. 448 (emphasis added). Section 8-118 permits the district court, ex parte and without constraints, to order an escrow of accrued and unpaid rent. This necessarily requires the court to determine what money is owed to the landlord as of the time the jury trial is prayed. That unfettered and unconditional determination requires a factual finding which impermissibly encroaches upon the function of the jury.

Moreover, the practical effect of a district court order, under § 8-118, is to require that a party prepay any possible judgment in order to obtain a jury trial. This places a premium on the exercise of this right in the context of ²³¹ landlord-tenant action. While no other jurisdiction has so encumbered a civil litigant’s right to a jury trial, 4 we believe ²³² that requiring such a premium for the exercise of one’s right to a jury trial is unreasonable. We realize that the legitimate purpose of summary eviction proceedings, i.e., accelerated relief, is often frustrated by a prayer for jury trial.

We believe, however, that requiring an escrow of past due rents provides a secure fund for the landlord, something to which neither he nor any other litigant is otherwise entitled and something which far exceeds previously defined “reasonable regulation” of the right to a jury trial. The “reasonable regulation” said to be constitutional in Bringe v. Collins was a mere procedural rule (former M.D.R. 343) requiring timely election of a jury trial. That rule, clearly designed to foster efficient judicial administration, imposed no financial burden on anyone seeking a jury trial, and only a minimal procedural one. This is not to say that monetary conditions may never be attached to exercise of the jury trial right.

Knee v. Baltimore City Passenger Ry. Co., for example, upheld the constitutionality of the payment of court costs as a condition precedent to jury trial. 87 Md. at 624-27 , 40 A. 890 . And see, Application of Harvey A. Smith, 381 Pa. 223 , 112 A.2d 625 (1955) and cases therein cited (State may constitutionally require a party praying civil jury trial to pay fees incurred as a result of jury request). But, in the latter cases the amounts involved were minor and the purposes of the requirements were related to court administration.

We also note that on ²³³ one occasion Maryland has held unconstitutional a provision imposing a monetary condition on the exercise of a constitutional right. Barnes v. Meleski, 211 Md. 182 , 126 A.2d 599 (1956) (unconstitutional to require payment of court costs as prerequisite to exercise of former absolute right to removal in civil cases). In any event, the question is as to the reasonableness of the regulation. As to the issue immediately before us (accrued and unpaid rents), the price is exorbitant.

It is, indeed, a different situation where, as here, the price to be paid makes the right practically unavailable. Under § 8-118, a tenant, wishing a jury trial, can be ordered to prepay what amounts to all monies allegedly owed; this is not the same as requiring that same party to pay the additional costs attendant on a jury trial. The payment, in the former instance, becomes a premium on the exercise of one’s inviolate right to a civil jury. Consequently, because the statute requires a predetermination of the amount owed and because it places a premium on the exercise of one’s right to a civil jury, we believe that § 8-118, to the extent that it provides for the payment of past due (accrued) rents into escrow, is an unreasonable, and, therefore, unconstitutional interference with that right.

Future (Accruing) Rents We do not suggest, however, that a statutory provision requiring the escrowing of rents as they become payable during the pendency of a jury trial is likewise unconstitutional. We observe that in Lindsey v. Normet, 405 U.S. 56 , 92 S.Ct. 862 , 31 L.Ed.2d 36 (1972), the Supreme Court of the United States, addressing the constitutionality of Oregon’s summary eviction statutes, noted that [tjhere are unique factual and legal characteristics of the landlord-tenant relationship that justify special statutory treatment inapplicable to other litigants. The tenant is, by definition, in possession of the property of the landlord; unless a judicially supervised mechanism is provided ²³⁴ for what would otherwise be swift repossession by the landlord himself, the tenant would be able to deny the landlord the rights of income incident to ownership by refusing to pay rent and by preventing sale or rental to someone else. Many expenses of the landlord continue to accrue whether a tenant pays his rent or not.

Speedy adjudication is desirable to prevent subjecting the landlord to undeserved economic loss and the tenant to unmerited harassment and dispossession when his lease or rental agreement gives him the right to peaceful and undisturbed possession of the property. Id. at 72-73 , 92 S.Ct. at 873-74 . In observing that a request for a continuance under Oregon’s statute would make it impossible for the courts to provide quick relief, the Supreme Court held that there was “no constitutional barrier to Oregon’s insistence that the tenant provide for accruing rent pending judicial settlement of his disputes with the lessor.” Id. at 67 , 92 S.Ct. at 871 . In the case subjudice a tenant’s request for a jury trial, like a request for a continuance, makes it impossible to provide a lessor with quick relief.

Therefore, we believe that if a tenant is to remain in possession of the landlord’s property, pending resolution of a jury trial, it is not unreasonable to request that the tenant pay for the privilege of remaining on the landlord’s premises. Unlike requiring an escrow of past due (accrued) rents, an escrow of future (accruing) rents, as they become payable, is not tantamount to paying for the privilege of exercising the right to a civil jury. In the latter instance the escrow fund represents money the tenant must pay in order to remain on the premises pending the jury trial. Section 8-118, to the extent it provides for the payment of future (accruing) rents into escrow, therefore, is a reasonable and, hence, constitutional regulation of one’s right to a jury trial.

B. Due Process Appellant argues that § 8-118, even if a constitutional regulation of one’s right to a jury trial, denies it procedural ²³⁵ due process in that no hearing is provided in connection with the district court’s escrow order. Because we hold that § 8-118, to the extent it requires an escrow of past due (accrued) rents, is substantively unconstitutional under Art. 23 of the Maryland Declaration of Rights, we need address appellant’s procedural due process contentions only in connection with an order to escrow future (accruing) rents. Due Process — Future (Accruing) Rents Appellant suggests, and we agree, that Article 24 of the Maryland Declaration of Rights, along with the Fourteenth Amendment to the United States Constitution, dictates a hearing in connection with a district court order requiring the payment of accruing rents into escrow. In Dep’t of Transportation, Motor Vehicle Administration v. Armacost, 299 Md. 392 , 474 A.2d 191 (1984) the Court of Appeals of Maryland set forth the requirements of procedural due process.

There the Court observed that: the aggrieved party must show that state action has resulted in a deprivation of a property interest within the meaning of the due process clause. Once deprivation of a property