Manzano v. Southern Maryland Hospital, Inc.

²⁰ CHASANOW, Judge. In this case we are called upon to decide whether the Court of Special Appeals erred in holding (1) that Petitioner failed to submit her claim to arbitration as required by the Health Care Malpractice Claims Act, Maryland Code (1973, 1989 RepLVol., 1992 Cum.Supp.), Courts & Judicial Proceedings Article, §§ 3-2A-01 et seq., 1 and (2) that the arbitration panel chair properly dismissed Petitioner’s claim for violation of a scheduling order. We hold that the Court of Special Appeals did err as to both issues. Therefore, we shall reverse the judgment of the Court of Special Appeals and remand the case to the circuit court with instructions to remand the claim to arbitration.

I. On October 10, 1988, Anthony Manzano was admitted to Southern Maryland Hospital (the Hospital) by Dr. Robert M. Nedzbala to receive treatment for pneumonia. Mr. Manzano died six days later, while under the care of Dr. Nedzbala and the Hospital. Petitioner, Maria R. Manzano, instituted this medical malpractice action, individually and as personal representative of the Estate of Anthony Manzano, against Dr. Nedzbala and the Hospital (collectively, Respondents). As required by the Health Care Malpractice Claims Act (the Act), Petitioner filed a claim with the Health Claims Arbitration Office (HCAO), on May 23, 1991, and an arbitration panel was assembled.

The chair of the arbitration panel originally set a hearing date of August 4, 1992, but continued the hearing to March 15, 1993, when he became aware that claimant’s expert, Dr. George Sample, had not made himself available for deposition by the opposing party. On August 11, 1992, the chair issued a revised scheduling order that required Petitioner to identify an expert witness by October 9, 1992, ²¹ and to provide Respondents with three dates upon which the expert would be available for deposition by November 6, 1992. Petitioner did identify her expert within the time mandated by the scheduling order, and the expert chosen was, again, Dr. Sample. Petitioner also provided the potential deposition dates, albeit not until November 13, 1992, one week later than required by the scheduling order.

Again, the delay was caused by Dr. Sample’s refusal to cooperate. When the dates were finally obtained, Petitioner’s counsel forwarded them to the chair via letter, dated November 16, 1992, in which he explained: “The delay in furnishing these dates was in no way due to the fault of the [Petitioner] or counsel.” Respondents moved to have Petitioner’s claim dismissed as a sanction for the violation of the chair’s scheduling order. The chair had the three prospective deposition dates in the file at the time of the hearing on Respondents’ motions to dismiss. Petitioner’s counsel argued that the minimal delay was neither his fault nor Petitioner’s and did not prejudice Respondents in any way.

Nevertheless, the chair granted Respondents’ motions to dismiss by Order dated November 25, 1992, nine days after the dates had been provided. Petitioner filed a notice of rejection of the arbitration award in the HCAO and an action to nullify the arbitration award in the Circuit Court for Prince George’s County. Respondents filed motions to dismiss Petitioner’s action to nullify, arguing that Petitioner was “flagrantly dilatory” and that her delay should be considered a failure to arbitrate. Petitioner argued, in her opposition to Respondents’ motions to dismiss, that her actions had not been willful, that Respondents had not been prejudiced by the delay, and that her actions did not constitute a failure to arbitrate.

Petitioner also filed a motion to vacate the arbitration award in the circuit court, arguing that the panel chair exceeded his power by imposing the extreme sanction of dismissal for Petitioner’s one-week delay in complying with the scheduling order. See §§ 3-2A-06(c), 3-224(b)(3). Respondents opposed Petitioner’s motion to vacate, arguing that she “failfed] to comply with [a] discovery order,” ²² and that a panel chair may dismiss a claim as a sanction for such a violation. The circuit court denied Petitioner’s motion to vacate the arbitration award on May 31, 1995. 2 The court found that “dismissal of an action for failure to comply with discovery requests is well within the discretion of the Panel Chairman,” and that the failure to comply “is not required to be willful and contumacious.” Thus, the court concluded that the panel chair did not abuse his discretion in dismissing Petitioner’s claim.

The circuit court also granted Respondents’ motions to dismiss Petitioner’s action to nullify, on June 29, 1995, and July 14, 1995, respectively, but it offered no supporting analysis for its finding that Petitioner’s delay constituted a failure to arbitrate. Petitioner appealed to the Court of Special Appeals, which affirmed the judgment of the circuit court in an unreported opinion. The intermediate appellate court held (1) that Petitioner’s failure to provide dates for her expert’s deposition by the date set by the panel chair constituted a failure to submit to arbitration as required by the Act, and (2) that the panel chair did not exceed his authority when he dismissed Petitioner’s claim for violation of a scheduling order. This Court issued a writ of certiorari to the Court of Special Appeals on December 11, 1996.

Petitioner asks this Court to address, in addition to the two issues raised below, whether the intermediate appellate court applied the correct standard of review when resolving issue number one.

II

The Act requires a claimant, as a condition precedent to instituting an action in a court of law, to submit his or her ²³ claim to non-binding arbitration. 3 §§ 3-2A-02(a), 3-2A-04(a)(1); Attorney General v. Johnson, 282 Md. 274, 283-84 , 385 A.2d 57, 63 (1978), partially overruled on other grounds, Newell v. Richards, 323 Md. 717 , 594 A.2d 1152 (1991). If a claimant files an action in a circuit court without having first submitted the claim to arbitration, the court must dismiss the action. Bailey v. Woel, 302 Md. 38, 45 , 485 A.2d 265, 268 (1984). In the case sub judice, the Court of Special Appeals held that the circuit court’s dismissal of Petitioner’s action was proper because her delay in complying with the scheduling order constituted a failure to submit the claim to arbitration as required by the Act.

The two cases the court relied upon to support its holding, Bailey, 302 Md. 38 , 485 A.2d 265 , and Robinson v. Pleet, 76 Md.App. 173 , 544 A.2d 1 , cert. denied, 313 Md. 689 , 548 A.2d 128 (1988), however, are inapplicable to the present case. In Bailey , the claimants filed their claim with the HCAO and participated in discovery but, at the arbitration hearing, refused to make an opening statement or to put on any evidence. 302 Md. at 40-41 , 485 A.2d at 265-66 . The arbitration panel, unable to decide the merits of the case without evidence, dismissed the claim. Bailey, 302 Md. at 40 , 485 A.2d at 266 .

The claimants then filed an action to nullify the award in the Circuit Court for Baltimore County, arguing that they were not required to put on evidence at the arbitration hearing because the mere filing of their claim with the HCAO constituted compliance with the Act’s arbitration requirement. Id. The circuit court disagreed and found that the plaintiffs, by refusing to participate in the arbitration hearing, had not satisfied the Act’s arbitration requirement. Id.

The plaintiffs appealed to the Court of Special Appeals, which affirmed the circuit court’s decision. Id. On its review of the judgment of the Court of Special Appeals, this Court held that, in order to satisfy the condition precedent to filing an action in a court of ²⁴ law, the Act requires that a claimant present evidence before an arbitration panel. Bailey, 302 Md. at 45 , 485 A.2d at 268 .

In Robinson , the claimant filed her claim in arbitration but failed to comply with another of the Act’s requirements, the filing of a certificate of qualified expert. 76 Md.App. at 174 , 544 A.2d at 1 . The panel chair, following the dictates of the Act, 4 dismissed Robinson’s claim. Robinson, 76 Md.App. at 174-75 , 544 A.2d at 2 . Robinson then filed an action in the Circuit Court for Baltimore County to nullify and vacate the arbitration award.

Robinson, 76 Md.App. at 175 , 544 A.2d at 2 . The circuit court dismissed Robinson’s action, finding that the panel chair had acted properly under the Act. Id. The Court of Special Appeals affirmed the circuit court’s decision, holding, inter alia, that the circuit court’s dismissal of Robinson’s action was proper because, as in Bailey , the claim was never arbitrated.

Robinson, 76 Md.App. at 176-78 , 544 A.2d at 3 . Thus, the court held, the condition precedent necessary to file suit in circuit court was not satisfied. Id. Bailey and Robinson each addressed a claimant’s total failure to comply with an explicit requirement of the Act.

These two cases provide no support for the intermediate appellate court’s holding in the present case, however, because Petitioner did not fail to comply with the Act. She submitted her claim to the HCAO, and she filed a certificate of expert witness. Petitioner was fully participating in discovery at the time her claim was dismissed, and the delay in submitting her expert’s prospective deposition dates was caused through no fault of Petitioner or her counsel. The more accurate analysis, which should have been made in this case, is to examine whether Petitioner failed to make a good faith effort at arbitration, that is, whether she ²⁵ intentionally delayed in turning over prospective deposition dates or in any way connived with her chosen expert in an effort to circumvent the Act’s arbitration requirement.

See Karl v. Davis, 100 Md.App. 42 , 639 A.2d 214 , cert. denied, 336 Md. 224 , 647 A.2d 444 (1994). In Karl , claimants’ counsel informed opposing counsel that he intended to present his expert’s discovery deposition testimony, rather than live testimony, at the arbitration hearing. 100 Md.App. at 46 , 639 A.2d at 216 . Opposing counsel stated that he would object to the admission of the deposition testimony because “the expert’s opinions were not rendered to a reasonable degree of medical probability.” Id. At the arbitration hearing, claimants offered the expert’s deposition testimony in lieu of live testimony, and the panel chair granted opposing counsel’s motion for summary judgment on the ground that the expert’s “deposition testimony as to violation of the standard of care was not stated to be within a reasonable degree of medical probability.” Karl, 100 Md.App. at 47 , 639 A.2d at 216 .

Claimants then filed an action to nullify the arbitration award in the Circuit Court for Wicomico County, which dismissed the action. Id. The circuit court found that the claimants, by presenting the deposition testimony after being notified of its inadequacies, had failed to arbitrate in good faith. Id.

On appeal, the Court of Special Appeals stated: “The question squarely before us is what will constitute a good faith effort at arbitration such that cases that subsequently proceed to the circuit court pursuant to ... § 3-2A-06 will not be dismissed for failure to arbitrate.” Karl, 100 Md.App. at 50 , 639 A.2d at 218 . The court held that, in order to dismiss a case from the circuit court on the basis of a lack of good faith, “some evidence of deliberate or knowing conduct on the part of the claimant or his or her counsel” is required. Karl, 100 Md.App. at 58 , 639 A.2d at 222 . The court did not find any willful or deliberate action on the part of counsel that was intended “to circumvent the mandatory requirement that medical negligence cases be submitted to arbitration to undergo a thorough dispute resolution process prior to presenting the controversy to circuit court.” Karl, 100 Md.App. at 59 , 639 ²⁶ A.2d at 222.

Claimants’ attorney had honestly believed that the testimony, when viewed in conjunction with other evidence in the case, was adequate. Karl, 100 Md.App. at 58 , 639 A.2d at 222 . The court held that counsel’s “misplaced reliance” on the expert’s deposition did not “suffice[ ], as a matter of law, to demonstrate a lack of good faith in appellant’s approach to the mandated arbitration process.” See Karl, 100 Md.App. at 49 , 639 A.2d at 217 . Thus, the Court of Special Appeals reversed the decision of the circuit court.

Karl, 100 Md.App. at 60 , 639 A.2d at 223 . In the case at bar, the Court of Special Appeals never considered whether Petitioner or her counsel deliberately and willfully failed to turn over the prospective deposition dates in an effort to circumvent the mandatory arbitration