Maryland Automobile Insurance Fund v. Soffas

BISHOP, Judge. This is an appeal from a judgment of the Circuit Court for Baltimore City in favor of appellee, James Sofías, granting summary judgment on a Cross-Claim filed by appellant, Maryland Automobile Insurance Fund (“MAIF”). Michael Reid and his wife, plaintiffs in the trial court, originally filed a claim for personal injuries and loss of consortium against co-defendants Roy Troutner and James Sofías, alleging the Troutner negligently operated a vehicle and caused plaintiffs’ injuries while acting as the agent of Sofías, the owner of the vehicle. Sofías moved for sum ⁶⁶⁶ mary judgment claiming he was not the owner of the car and Troutner was not his agent.

Several months later, MAIF moved to intervene in the suit as a defendant because plaintiffs held an insurance policy with MAIF which provided uninsured motorist benefits. On November 27, 1989, the trial court granted MAIF’s Motion to Intervene and, three days later, MAIF filed an Answer to plaintiffs’ Complaint. On December 4, 1989, MAIF filed a Cross-Claim for indemnification against Troutner and Sofías. On December 14,1989, the trial court granted Soffas’s Motion for Summary Judgment against the plaintiffs and ordered final judgment be entered in favor of Sofías.

Judgment was entered on December 21, 1989. Sofías, as cross-defendant, then filed a Motion for Summary Judgment against MAIF’s Cross-Claim, which was granted by the trial court. MAIF’s Motion for Reconsideration was denied and final judgment was entered in favor of Sofías. Issues Presented I. Should appellant MAIF, in its Cross-Claim against Sofías, have been bound by the trial court’s previous award of summary judgment on December 21, 1989, in favor of Sofías and against the plaintiffs?

II

Did the trial court properly deny Soffas’s Motion for Summary Judgment with respect to MAIF’s Cross-Claim, on the merits, in light of the existence of genuine disputes concerning material facts? Statement of Facts On September 3, 1986, Michael Reid was traveling northbound on Martin Luther King Boulevard and stopped in response to the traffic in front of him. Troutner was driving immediately behind Reid and, when Troutner failed to stop, he crashed into the rear of Reid’s vehicle. Reid and his wife brought suit against Troutner and Sofías, the alleged owner of the vehicle driven by Troutner, ⁶⁶⁷ seeking damages for personal injuries and lost consortium.

The Complaint alleged that Troutner negligently operated his vehicle and caused plaintiffs’ injuries, while acting as the agent of Sofías. Troutner never responded to the Complaint and an Order of Default was entered against him. Sofías answered the Reids’ interrogatories and filed a Motion for Summary Judgment against the Reids. The Motion included an affidavit in which Sofías alleged that he sold the vehicle to Troutner in August 1986, the month before the accident.

Sofías denied owning the vehicle in September and denied that he ever employed Troutner. Sofías alleged: On the day of the sale, I removed the license plates registered to me ... and placed them on the car roof— Mr. Troutner and I started talking and we went into his house; when I left for home, I forgot to take the license plates with me. As soon as I returned home, I immediately called Mr. Troutner and asked that he return the plates to me but he indicated that he would simply return the plates into the Department of Motor Vehicles the next day when he registered the car to his name____ I sent [Reids’ attorney] on two separate occasions, a photocopy of the bill of sale between myself and Roy Troutner. Unfortunately, I subsequently misplaced [it].

Several months after the Motion for Summary Judgment was filed, MAIF moved to intervene on the ground that it provided the Reids’ insurance which contained uninsured motorist benefits. On November 27, 1989, at a hearing before Judge Hubbard, in the Circuit Court for Baltimore City, MAIF’s Motion to Intervene as a party defendant was granted and Sofías’s Motion for Summary Judgment was held sub curia, until December 7, 1989 to await further pleadings from MAIF. The purpose of this was to allow the deposition of Sofías, which had been noted previously by the Reids and was to be held on December 4, 1989. MAIF was present at this hearing.

MAIF had not filed a ⁶⁶⁸ notice to take a deposition because it had just been granted its Motion to Intervene at the November 27th hearing. On November 30, 1989, Soffas’s attorney notified Judge Hubbard, by letter, that the Reids had cancelled Soffas’s deposition and that MAIF had indicated it would not be taking the deposition on December 4. Soffas’s attorney requested a ruling on his pending Motion for Summary Judgment against Reid. Copies of this letter were sent to the Reids and MAIF.

On December 4, 1989, MAIF filed a Cross-Claim for indemnification against Troutner and Sofías alleging that Troutner negligently operated the vehicle while acting as the agent of Sofías, and that Sofías negligently entrusted the vehicle to Troutner. MAIF also forwarded a Request for Production of Documents to Sofías. On December 5, 1989, in response to Soffas’s Motion for Summary Judgment, the Reids filed a response, not under oath as required by Maryland Rule 2-501(b), that contained a copy of the police report of the accident indicating that Sofías was the owner of the vehicle driven by Troutner, and a certificate of title from the Motor Vehicle Administration indicating that Sofías sold the vehicle on October 14, 1986. The response alleged that Troutner was acting as the “agent, servant and/or employee” of Sofías and that the Reids never received the Bill of Sale for the vehicle that Sofías claimed to have sent to them.

On December 14, 1989, Judge Hubbard granted summary judgment in favor of Sofías and against the Reids without a hearing. Pursuant to Md. Rule 2-602(b), the Judge expressly determined there was no just reason for delay, and final judgment was entered and became appealable on December 21, 1989. Neither the Reids nor MAIF appealed within 30 days thereafter as required by Md. Rule 8-202. On December 15, Sofías answered MAIF’s Cross-Claim and supplemented his response to Reids’ Request for Production of Documents. ⁶⁶⁹ Soffas filed a Motion for Summary Judgment against MAIF’s Cross-Claim and the Reids filed an Amended Complaint naming MAIF as a defendant and alleged that they were entitled to make a claim with MAIF under the uninsured motorist coverage of their insurance policy.

MAIF answered the Motion for Summary Judgment but did not include an affidavit or written statement under oath. The answer did not contain any evidence on agency not previously included in Reid’s response to Soffas’s Motion for Summary Judgment against the Reids. A hearing on Soffas’s Motion for Summary Judgment on the Cross-Complaint was held and Judge Ross granted summary judgment in favor of Soffas. As to Count 1 of MAIF’s Cross-Claim (alleging Soffas’s ownership of the vehicle and agency with Troutner) Judge Ross found MAIF was bound by Judge Hubbard’s grant of summary judgment against the Reids [by the doctrine of collateral estoppel].

As to Count 2, which alleged that Soffas negligently entrusted the vehicle to Troutner, Judge Ross found there was no genuine dispute concerning material facts. Appellant MAIF did not appeal this ruling. Soffas’s motion for final judgment based on Judge Ross’s ruling was granted. Discussion The proper standard for appellate review of a trial court’s grant of a motion for summary judgment is whether the trial court was legally correct.

Heat & Power v. Air Products, 320 Md. 584, 591-92 , 578 A.2d 1202 (1990) (summary judgment is a question of law, not fact). MAIF contends that Judge Ross improperly granted Soffas’s Motion for Summary Judgment when he ruled that MAIF was collaterally estopped from claiming a genuine dispute as to agency, by Judge Hubbard’s previous grant of summary judgment against Reid on the same question of agency. “Maryland law is clear that ... collateral estoppel will apply where there has been a final judgment of a court on ⁶⁷⁰ the merits in a previous proceeding.” Harding v. Ramsay, Scarlett & Co., Inc., 599 F.Supp. 180, 183 (1984) (citing Institutional Management v. Cutler Computer, 294 Md. 626, 633 , 451 A.2d 1224 (1982); Surrey Inn, Inc. v. Jennings, 215 Md. 446, 454-55 , 138 A.2d 658 (1958)). “[W]hen an issue of fact or law is actually litigated and determined by a valid and final judgment, and the determination is essential to the judgment, the determination is conclusive in a subsequent action between the parties, whether on the same or different claim.” See Murray Int'l Freight Corp. v. Graham, 315 Md. 543, 547 [ 555 A.2d 502 ] ... (1989)... In Murray, we discussed the following considerations in applying this rule: 1) the identity of parties, 2) the actual litigation of an issue of fact or law, 3) the essentialness of the determination to the judgment and 4) the appealability of that determination by the party against whom the issue preclusion is being asserted.

Id. at 549 [ 555 A.2d 502 ]____ Cassidy v. Board of Education, 316 Md. 50, 62 , 557 A.2d 227 (1989) (quoting Restatement (Second) of Judgments § 27 (1980)). In Washington Suburban Sanitary Commission v. TKU Associates, 281 Md. 1, 19 , 376 A.2d 505 (1977), the Court of Appeals also considered whether the party against whom collateral estoppel was asserted was given a “fair opportunity to be heard on the issue” in determining whether the party was bound by the prior adjudication. Applying the factors from Cassidy and TKU, we hold that Judge Ross properly granted Soffas’s Motion for