Maryland Radiological Society, Inc. v. Health Services Cost Review Commission

Digges, J., delivered the opinion of the Court. The present legal skirmish is a by-product of this Court’s earlier Maryland Rule 871 remand in this same action for further proceedings consistent with our opinion that has now been reported as Holy Cross Hosp. v. Health Services, 283 Md. 677 , 393 A. 2d 181 (1978). The record in that case, which is again before us, discloses that following an administrative hearing in which Holy Cross Hospital actively participated as a party, respondent ³⁸⁵ Maryland Health Services Cost Review Commission concluded “that the salaries of the radiologists, pathologists and cardiologists [associated with the hospital] are subject to [commission] review as a part of their legislative charge to assure the public that total costs are reasonably related to total services provided.” The hospital, being dissatisfied with this determination, appealed to the Circuit Court for Montgomery County pursuant to Md. Code (1957, 1978 Repl. Vol.), Art. 41, § 255, a part of the Administrative Procedure Act.

In the circuit court, Drs. Robert E. McCullough and Edward D. Soma, a pathologist and a radiologist, respectively, who were associated with Holy Cross, obtained leave to intervene and thus joined the hospital as parties before the trial court in contesting the validity of the commission’s ruling. When the circuit court reached the same conclusion as had the administrative agency, the hospital and the two intervening doctors, in a proper manner, sought further appellate review and we granted certiorari. In identifying the issue earlier before this Court in Holy Cross Hosp. v. Health Services, our opinion indicates that we were there involved as a matter of statutory construction with the question of whether fees charged by physicians in certain medical specialties to hospital patients, which fees are placed on hospital accounts and billed by the hospitals in such amounts to the patients, constitute a part of “the total costs of the hospital” so as to be considered as “reasonably related to the total services offered by the hospital” and thus whether the Maryland Health Services Cost Review Commission (the Commission) is empowered to review and set charges by these physicians in the specialties of cardiology, pathology, and radiology. [ 283 Md. at 679 , 393 A. 2d at 182 . 1 ] ³⁸⁶ In disposing of that question, Judge Smith, writing for the Court, announced and explained our ruling: [W]e are unable to agree with the conclusion of the trial judge or the conclusion of the Commission that the fees charged by these pathologists, radiologists, and cardiologists are a part of the “costs of the hospital,” the term being used here in the sense of cost of operation of a hospital.

On the other hand, we do not rule out the possibility that at the time of the enactment of this statute the words “total costs of the hospital” might have been a term “of art” in the health care field having a well understood meaning different from its common signification which would include the fees of the physicians here. Therefore, we think that the cause of justice would be best served by a remand of this case to the Circuit Court for Montgomery County under Maryland Rule 871 without affirmance or reversal for further proceedings in which the Commission would be afforded an opportunity to present evidence of such an understanding of the meaning of the term within the field of health care at the time this statute was enacted, if such testimony in fact is available. [Id at 689-90 [187].] The record, as it relates to the current dispute before us, discloses that in December 1978, at about the time our mandate issued in the principal case, Maryland Radiological Society, Inc., 2 and two of its radiologist-officers, Drs. Michael L. Sherman and James E. Bell, filed motions seeking leave under Maryland Rule 208 to intervene in the new proceeding that was directed by this Court. This request received a favorable endorsement from the hospital and the earlier intervening doctors, but met with stiff opposition from the commission.

Concluding these intervention requests did ³⁸⁷ not meet the requirements of Rule 208 in that they were not timely filed, and, in any event, the applicants had not shown satisfactorily that the representation of their interests by existing parties “is or may be inadequate,” Circuit Court Judge Philip M. Fairbanks denied the motions on April 5, 1979. The following day the rejected movants appealed to the Court of Special Appeals and we later granted certiorari. 3 ***⁸ Because Rule 208 controls intervention by an outsider in an already pending action and that rule is at the core of the dispute now before us, we note that in relevant part it provides: a. Of Right. Upon timely application a person shall be permitted to intervene in an action: (a) when the representation of the applicant’s interest by existing parties is or may be inadequate and the applicant is or may be bound by a judgment in the action .... b.

Permissive 1. Person Upon timely application a person may be permitted to intervene in an action when his claim or defense has a question of law or fact in common with the action. In this appeal, the applicants controvert the trial court’s denial ruling principally by asserting that they may intervene and participate as a matter of right under Rule 208 a in the upcoming proceeding that we ordered because 1) 'their motions were timely filed, and 2) their interests are not being adequately protected by the present parties, Holy Cross Hospital, Dr. McCullough, and Dr. Soma; alternatively, they ³⁸⁸ urge that the trial court abused its discretion in not granting them permissive intervention pursuant to Rule 208 b. While agreeing with the petitioners that their applications to become parties were timely filed, we nevertheless reject the remaining two contentions they make and, as a consequence, will affirm the trial court’s rulings denying intervention. 4 We now explain our reasons.

TIMELINESS Whether intervention be aske'd as of right or permissively, it is manifest from the inaugural words of both sections a and b of Rule 208 that timely application is a prerequisite to such a request being granted. Thus, before proceeding to consider the substantive merits of an intervention motion, a trial court should require that the applicant demonstrate the promptness of his request. Whether it is so shown is dependent upon the individual circumstances of each case and rests in the sound discretion of the trial court, which, unless abused, will not be disturbed on appellate review. NAACP v. New York, 413 U. S. 345, 365-66 , 93 S. Ct. 2591 , 37 L. Ed. 2d 648 (1973).

In considering the promptness factors contained in Federal Rule of Civil Procedure 24, which is almost identical to our Rule 208, 5 the United States Supreme Court stated in NAACPthaX “[although the point to which the suit has progressed is one factor in the determination of timeliness, it is not solely dispositive. Timeliness is to be determined from all the circumstances.” Id. at 365-66 (footnote omitted). Even though all relevant circumstances should be taken into account in assessing the timeliness of an intervention motion, as a general guide for the trial courts of this State in their consideration of the issue we now fashion from the federal ³⁸⁹ authorities the following framework for inquiry: one, the purpose for which intervention is sought; two, the probability of prejudice to the parties already in the case; three, the extent to which the proceedings have progressed when the movant applies to intervene; and four, the reason or reasons for the delay in seeking intervention. See Natural Resources Defense Council v. Costle, 561 F. 2d 904, 907 (D.C. Cir. 1977); Commonwealth of Pa. v. Rizzo, 530 F. 2d 501, 506 (3d Cir.), cert. denied, 426 U. S. 921 (1976).

The trial judge in the case now before us concluded that since the principal action was initiated in the circuit court in March of 1977 and intervention was not sought by the present applicants until our mandate in that case was issued in December 1978, the time lag of more than a year authorized the court’s determination “that the applications to intervene are not timely filed and should not be granted, either on a permissive basis or as a matter of right.” We, however, conclude that a consideration of the factors just set out requires a different ruling. In explanation we mention that, in the first place and of prime importance, it must be borne in mind that the applicants’ purpose in seeking to intervene at the time their motions were filed was not in any way to change or otherwise influence any proceeding, ruling, or decision that had already been made or taken place in the action, but merely to participate in and urge adoption of their view on the very narrow issue this Court directed be determined on remand: Whether at the time of enactment the statutory words “ ‘total costs of the hospital’ [were] a term ‘of art’ in the health care field having a well understood meaning [that has general acceptance throughout Maryland] different from its common signification which would include