Mathis v. Hargrove

DAVIS, J. Appellants, Jerry Mathis, Prudential Mathis Realtors and Mathis Realty, Inc., 1 appeal from the verdict of a jury in the Circuit for Prince George’s County, Clark, J., in favor of appellee, Aaron Hargrove. Appellants raise the following issues on this appeal: I. Whether the circuit court wrongfully declined to decide on the motion for summary judgment; II. Whether the circuit court erred by denying appellants’ motion for summary judgment, where appellee failed to file an opposition to the motion; III. Whether the circuit court, appellants’ attorney, and appellee’s attorney violated appellants’ constitutional due process rights regarding a subpoenaed witness and by ignoring appellants’ right to a ruling on motion; IV.

Whether the jury’s verdict was supported by substantial evidence in a written record; V. Whether appellee voluntarily breached his orally modified contact [sic]; A. Parties’ Agreement Creates An Independent Contractor Relationship; and B. Appellee Unilaterally Modified the Oral Contract, therein Breaching; and VI. Whether the finding of fraud, evil intent, willful or knowing requires a showing of intent. ²⁹³ FACTS AND PROCEDURAL BACKGROUND On August 1, 2001, appellant and Mathis Realtors, Inc., d/b/a, Prudential Mathis Realtors, entered into a Broker Associate Independent Contracting Agreement with appellee. Pursuant to § 9(B) of the Agreement, appellee promised to pay $2,000 per month to Prudential Mathis Realtors, Inc. Under the Agreement, appellee was to retain 100 percent of commissions he earned and, pursuant to the Addendum of even date, appellee was allowed to have, on his staff, up to four licensed agents working out of his designated office space without incurring any additional monthly rental fees. Each additional member of his “team,” up to a maximum of seven, was required to pay a $150 per month rental fee and each associate under appellee’s supervision was required to pay $150 per transaction up to four transactions per month.

In September 2002, appellant and appellee verbally agreed to modify the Broker Associate Agreement. Appellee would establish a new office in Bowie, pay fifty percent of the initial opening expenses, fifty percent of all subsequent operating expenses, and receive fifty percent of any future profits. Appellant insisted that they had agreed appellee was also to pay $2,000 per month as his initial investment capital as consideration for a partnership in the business. Appellant would continue to manage the Fort Washington office and appellee would manage the new office in Bowie.

According to appellee, there was a further agreement that the $25,000 rental commission paid by the owner of the office building for the five-year lease on the Bowie location executed by appellant would be divided equally between them. Appel-lee also claimed that he paid $27,329 of his own money between January and March of 2003, which constituted payment of the initial expenses to which they had agreed. In addition, he paid a rental commission of approximately $29,000. Appellants, in their submission to this Court, state: “On March 25, 2003, appellee, Hargrove, informed appellant, that he would have to disassociate himself from Jerry J. Mathis and Prudential Mathis Realtors, Inc.” ²⁹⁴ In reference to the termination of the relationship, appellee testified that, after he, Jerry Mathis and his wife and other members of the Company returned from a convention in Las Vegas, Mathis and his wife summoned him into their office and told him that they were dissatisfied with his production.

Appellee had a bad managerial style, he did not smile enough, and agents were afraid to talk to Jerry for fear that anything they said to him would be used by appellee against them. According to Hargrove, he was told by appellant and Ms. Mathis that “they no longer wanted me to manage the Ft. Washington — the midway office and our partnership arrangement was being abolished and I could no longer manage the Bowie office, the 50/50 percent arrangement, I could be anything but 50 percent.” In short, Hargrove was told that Mathis had to have a controlling interest, that he could be anything in the Company except a manager, and that he could work out of any office other than the manager’s office. When asked to describe his reaction to appellant’s repudiation of their agreement, Hargrove explained: Well, you know, I was devastated by it, because here’s something that we both went into together.

At this time I had almost in excess of you know 20, 30, $40,000 invested into their venture, and then I felt like the rug was being pulled out from underneath of me, and I thought that if he could change the rules of the game three months into the venture, what would happen if I got a year down the line or two years down the line with more invested into this venture. So at that point in time I just told him if your rules are going to change, then I can’t continue to partner with you, and I took the option of taking no percentage and I offered him my resignation. Appellee subsequently transferred his license, as did other members of his “team,” to Realty Executives, 2000 in Bowie. On December 10, 2003, appellee filed a three-count complaint alleging in Count I, Replevin, Trespass and Conversion, stemming from appellant’s “wrongfully barring Aaron Hargrove from retrieving his furniture and files” from the Fort Washington office of Prudential-Mathis Realtors, Inc.; Count II, ²⁹⁵ Breach of Contract, Breach of Fiduciary Duty, Fraud, based on appellant’s alleged failure to make a full accounting and to remit commissions due within 20 business days after May 20, 2003 after securing drafts, made payable to Jerry J. Mathis and Prudential Mathis Realtors, Inc., received from appellee for transactions he procured; Count III, Breach of Partnership Agreement, Fraud, based on appellant’s alleged termination of appellee and reduction in ownership interest from 50% to 49% after having been induced “to invest time and money into the opening of the Bowie office in return for a 50% ownership interest.” Prior to trial, the following transpired regarding appellants’ motion for summary judgment: THE COURT: All right.

I’m ready to proceed. I see that there is a motion for summary judgment, but I don’t understand why it wasn’t ruled on. [APPELLEE’S COUNSEL]: If I might just explain for the record, Your Honor? THE COURT: Go ahead. [APPELLANTS’ COUNSEL]: May I invoke the rule on witnesses, or is that necessary? THE COURT: No, that’s all right.

Anyone who is going to testify in this matter needs to remain outside the courtroom. While you’re outside the courtroom, you’re not to discuss this matter amongst yourselves or with anyone else. [APPELLEE’S COUNSEL]: Thank you, Your Honor. Your Honor, as opposing counsel has indicated, the motion for summary judgment was actually filed after the date of the scheduling order. We had our pretrial conference on June the 23rd.

At that time, which I originally entered my appearance as counsel in the case, outgoing counsel had not conducted discovery. The defendant was prejudiced in that matter, so we asked the judge at the time to allow reopening of discovery. He did so. Discovery was reopened for a sixty-day period.

Co-counsel — opposing—counsel and myself agreed to ex ²⁹⁶ tend it beyond that. In fact, we did not complete discovery in this matter until September, I think it was, 17th of this year time frame. By the time approximately twenty depositions and hundreds of pages of deposition testimony and exhibits were actually produced for us and then got a chance to decipher it and apply the theory to the case, it was the November time frame. We then, looking at the evidence, the affidavit, you know, the admissions, submitted a motion for summary judgment.

As counsel indicated, by the date that was filed their response was not due until, again, tomorrow. He filed a motion to strike on behalf of the plaintiff. We did not get that because of a mail mix up. The motion linked to the wrong address, came back, and counsel diligently had it Fed Ex’d to me.

The second I received it I immediately turned around and filed an opposition and also asked the court at that time I filed a motion last Friday to continue the trial. Pending the court’s decision with respect to the motion for summary judgment, of course, counsel indicates, you know, that he wants to proceed. We are prepared to proceed. However, as the court will recognize, we’ve got two attorneys over here.

I’ve handled it as pro hac vice. The defendant, as counter-plaintiff. Is [sic] required to have two counsels [sic] here. My position was that it prejudices the defendants.

THE COURT: Has there been an order permitting you to practice? [APPELLEE’S COUNSEL]: Yes, ma’am. There’s one in there. Judge Missouri signed it and — but the problem, obviously, that we have, that if the matter can be resolved via summary judgment, therefore it reduces the amount of the money that the client has to pay. So I thought it was a prudent way to go, given the evidence that we discovered in the case via discovery.

Had discovery been ²⁹⁷ originally conducted according to the original schedule, of course, those motions would be filed on time and we wouldn’t be in this predicament. THE COURT: I think we have to proceed with the trial. We already selected the jury. [APPELLANTS’ COUNSEL]: Your Honor, may I be heard just so-I need to know what my comfort level is as to whether I have to go back to my office and spend overnight opposing that motion for summary judgment. THE COURT: No, you don’t. [APPELLANTS’ COUNSEL]: So is my motion to strike granted?

THE COURT: No, the motion, basically, once the trial is over, the motion will be moot. At the conclusion of the trial, the case was submitted to the jury, which rendered the following verdicts: as to Count I, replevin, the jury awarded appellee $5,700; as to Count II, breach of contract for failing to pay commissions earned from listings in sales transactions settled after appellee’s termination, the jury awarded appellee $49,362.74; and as to Count III, breach of contract for failure to abide by the terms of the opening of the office in Bowie, the jury awarded appellee $39,622.81. Because the jury determined in the first phase of the trial that appellants’ actions were characterized by evil motive, intent to injure, ill will and fraud, as part of the second phase of the trial they awarded appellee punitive damages on Count I in the amount of zero dollars; on Count II in the amount of $5,000; on Count III in the amount of $29,059.40. From the jury’s verdicts and the judgments entered thereon, this timely appeal was filed.

LEGAL ANALYSIS Appellants contend in the first issue presented, “in the instant matter, reservation of the ruling on appellants’ motion for summary judgment, effectively or impliedly denied the motion, thereby opining that there were outstanding material issues of genuine fact.” ²⁹⁸ MOTION FOR SUMMARY JUDGMENT Maryland Rule 2-501, Motion for Summary Judgment, provides, in pertinent part: (a) Motion. Any party may make a motion for summary judgment on all or part of an action on the ground that there is no genuine dispute as to any material fact and that the party is entitled to judgment as a matter of law. The motion shall be supported by affidavit if it is (1) filed before the day on which the adverse party’s initial pleading or motion is filed or (2) based on facts not contained in the record. (b) Response.

A response to a written motion for summary judgment shall be in writing and shall (1) identify with particularity each material fact as to which it is contended that there is a genuine dispute and (2) as to each such fact, identify and attach the relevant portion of the specific document, discovery response, transcript of testimony (by page and line), or other statement under oath that demonstrates the dispute. A response asserting the existence of a material fact or controverting any fact contained in the record shall be supported by an affidavit or other written statement under oath. (c) Form of Affidavit. An affidavit supporting or opposing a motion for summary judgment shall be made upon personal knowledge, shall set forth such facts as would be admissible in evidence, and shall show affirmatively that the affiant is competent to testify to the matters stated in the affidavit.

(d) Affidavit of Defense Not Available. If the court is satisfied from the affidavit of a party opposing a motion for summary judgment that the facts essential to justify the opposition cannot be set forth for reasons stated in the affidavit, the court may deny the motion or may order a continuance to permit affidavits to be obtained or discovery to be conducted or may enter any other order that justice requires. (e) Contradictory Affidavit or Statement. ²⁹⁹ (1) A party may file a motion to strike an affidavit or other statement under oath to the extent that it contradicts any prior sworn statement of the person making the affidavit or statement. Prior sworn statements include (A) testimony at a prior hearing, (B) an answer to an interrogatory, and (C) deposition testimony that has not been corrected by changes made within the time allowed by Rule 2-415.

(2) If the court finds that the affidavit or other statement under oath materially contradicts the prior sworn statement, the court shall strike the contradictory part unless the court determines that (A) the person reasonably believed the prior statement to be true based on facts known to the person at the time the prior statement was made, and (B) the statement in the affidavit or other statement under oath is based on facts that were not known to the person and could not reasonably have been known to the person at the time the prior statement was made or, if the prior statement was made in a deposition, within the time allowed by Rule 2-415(d) for correcting the deposition. (f) Entry of Judgment. The court shall enter judgment in favor of or against the moving party if the motion and response show that there is no genuine dispute as to any material fact and that the party in whose favor judgment is entered is entitled to judgment as a matter of law. By order pursuant to Rule 2-602(b), the court may direct entry of judgment (1) for or against one or more but less than all of the parties to the action, (2) upon one or more but less than all of the claims presented by a party to the action, or (3) for some but less than all of the amount requested when the claim for relief is for money only and the court reserves disposition of the balance of the amount requested.

If the judgment is entered against a party in default for failure to appear in the action, the clerk promptly shall send a copy of the judgment to that party at the party’s last known address appearing in the court file. We engaged in an in-depth discussion of the obligations imposed on the parties, on a motion for summary judgment, to establish the necessity, vel non, for a controversy to proceed ³⁰⁰ to a trial on the merits in Bond v. Nibco, Inc., 96 Md.App. 127, 134-36 , 623 A.2d 731 (1993). Because of the centrality of the operative effect of a motion for summary judgment, we quote liberally from that discussion in Bond . Thus, a moving party must set forth sufficient grounds for summary judgment.

Although the movant is not required to support his motion with an affidavit unless he files it “before the day on which the adverse party’s initial pleading or motion is filed,” see Md. Rule 2-501 (a), he must support his various contentions by placing before the court facts that would be admissible in evidence or otherwise detailing the absence of evidence in the record to support a cause of action. The Supreme Court and the Court of Appeals have, in recent years, emphasized that a trial court should not be reluctant to grant a motion for summary judgment in an appropriate case. In Seaboard Surety Co. v. Richard F. Kline, Inc., 91 Md.App. 236, 242-45 , 603 A.2d 1357 (1992), we discussed at some length these teachings, emphasizing that a motion for summary judgment, although not a substitute for trial, is nevertheless not disfavored. A proper summary judgment motion is to be granted unless the parties truly dispute a material fact, i.e., the evidence is such that a fair minded jury could return a verdict for the nonmovant.

Id. at 244 , 603 A.2d 1357 . For this reason, although a party opposing a proper motion for summary judgment need not file an affidavit unless “the motion ... is supported by an affidavit or other statement under oath,” see Md. Rule 2-501 (b), the opponent cannot rely on formal denials or general allegations. Instead, an opponent must “identify with particularity the material facts that are disputed.” Md. Rule 2-501(b). Thus, “[when a moving party has set forth sufficient grounds for summary judgment,] the party opposing the motion must show with ‘some precision’ that there is a genuine dispute as to a material fact,” and place before the trial court facts that would be admissible in evidence. ³⁰¹ All of these principles remain good law; we do not disavow or limit any of them.

They are, however, all premised on a proper motion for summary judgment. A party moving for summary judgment, like a party filing any other motion, must comply with Md. Rule 2-311. See Paul V. Niemeyer & Linda M. Schuett, Maryland Rules Commentary 171 (2d ed. 1992) (“Niemeyer”). See also Md. Rules Committee, Minutes of Oct. 17, 1981 meeting, at 48 (“Rule 2-311 ... governs all motions, including summary judgment motions”).

That is, if the summary judgment motion is based on facts not contained in the record or papers on file in the proceeding it “shall be supported by affidavit and accompanied by any papers on which it is based.” Md. Rule 2-311(d) (1993). Moreover, as the Supreme Court noted in articulating its now famous Celotex Corp. [v. Catrett, 477 U.S. 317 , 106 S.Ct. 2548 , 91 L.Ed.2d 265 (1986)] holding, even when an affidavit is not necessary ... a party seeking summary judgment always bears the initial responsibility of informing the district court of the basis for its motion, and, identifying those portions of “the pleadings, depositions, answers to interrogatories and admissions on file, together with the affidavits, if any,” which it believes demonstrate the absence of a genuine issue of material fact. Celotex Corp., 477 U.S. at 323 , 106 S.Ct. at 2553 . (emphasis added). “To satisfy the requirement that there be no genuine dispute as to any material fact, the moving party m,ust include in the motion the facts necessary to obtain judgment and, a shown,ng that there is no dispute as to any of those facts.” Niemeyer at 330 (emphasis added).

Only if a movant “bears this initial responsibility” or makes this “showing” does the party opposing the summary judgment motion have the burden of identifying “with particularity the material facts that are disputed.” Md. Rule 2-501(b). See Galindo v. Precision American Corp., 754 F.2d 1212, 1216, 1221 (5th Cir.1985). Thus, a motion for summary judgment that simply asserts that the opponent has not ³⁰² identified disputed facts is not sufficient. A summary judgment movant usually is not required to file an affidavit, see Md. Rule 2-501 (a), but if the movant disputes facts alleged in the complaint (or answer if the movant is the plaintiff), the movant must himself identify the portions of the record that “demonstrate the absence of a genuine issue of material fact.” Celotex, 477 U.S. at 323 , 106 S.Ct. at 2553 .

Indeed, the movant must attach “as an exhibit” to his motion “any document” that he “wishes the court to consider in ruling on the motion ... unless the document is adopted by reference as permitted by Rule 2-303(d) or set forth as permitted by Rule 2-432(b).” Md. Rule 2-311(c) (1993). (Citations omitted.) I We begin by accepting appellants’ premise that the circuit court’s reservation of its ruling on the motion for summary judgment effectively operated to deny the motion. As the court put it, “... once the trial is over, the motion will be moot.” The extenuating circumstances regarding the failure of appellee’s prior trial counsel to comply with the discovery schedule and which, in turn, reduced the time for appellee to respond to the motion for summary judgment, are set forth, supra. That said, although a motion for summary judgment may be filed at any time prior to or during the trial, see Baker, Watts & Co. v. Miles & Stockbridge, 95 Md.App. 145, 161 , 620 A.2d 356 (1993) 2 , the reservation of the court’s ruling on the motion defeats the very purpose for filing the motion pretrial, i.e., to obviate the need for a trial where there is no dispute as to a fact which is material to the outcome of the case.

Moreover, it is well settled that the denial of a motion for summary judgment is, in most instances, an interlocutory ³⁰³ order 3 not subject to an immediate appeal, but reviewable only after the conclusion of proceedings ending in a final judgment. Appellants, in essence, claim that there were no outstanding issues of material fact and apparently that a legal ruling should have been forthcoming, in favor of either appellant or appellee. With the foregoing in mind, our task, as we see it, is to determine the nature and extent of appellate review of the court’s refusal to rule on the motion to which appellant is entitled, and what legal harm appellant has sustained from the inability to obtain a determination, pre-trial, as to whether appellant was entitled to judgment as a matter of law based on the pleadings, depositions, interrogatories, affidavits, discovery and other submissions offered on the motion. In Metropolitan Mortgage Fund, Inc. v. Basiliko, 288 Md. 25, 26 , 415 A.2d 582 (1980), the Court of Appeals discussed the narrow question of the standard of review for a pretrial denial of summary judgment following a full trial on the merits.

In that case, the Court stated: Consequently, we now hold that a denial (as distinguished from a grant) of a summary judgment motion, as well as foregoing the ruling on such a motion either temporarily until later in the proceedings or for resolution by trial of the general issue, involves not only pure legal questions but also an exercise of discretion as to whether the decision should be postponed until it can be supported by a complete factual record; and we further hold that on appeal, absent clear abuse ..., the manner in which this discretion is exercised will not be disturbed. Id. at 29 , 415 A.2d 582 . Relying upon federal authority, the Court explained that, while a court is generally not able to “draw upon any discre ³⁰⁴ tionary power to grant summary judgment, it ordinarily does possess discretion to refuse to pass upon, as well as discretion affirmatively to deny, a summary judgment request in favor of a full hearing on the merits; and this discretion exists even though the technical requirements for entry of such a judgment have been met.” Id. at 28 , 415 A.2d 582 . Basiliko goes on to state: “It is our view that an appellate court should be loath indeed to overturn, on a very narrow procedural ground, a final judgment on the merits entered in favor of the party resisting the summary judgment.” Id. at 29 , 415 A.2d 582 .

See also Foy v. Prudential Insurance Company of America, 316 Md. 418, 423-24 , 559 A.2d 371 (1989). “It follows from our holdings in Fenwick [Motor Co. v. Fenwick, 258 Md. 134 , 265 A.2d 256 (1970)] and Basiliko, [supra], that ordinarily no party is entitled to summary judgment as a matter of law. It is within the discretion of the judge hearing the motion, if he finds no uncontroverted material facts, to grant summary judgment or to require a trial on the merits. It is not reversible error for him to deny the motion and require a trial.” Prudential Ins. Co. of Am., 316 Md. at 424 , 559 A.2d 371 .

Remaining true to the basic premise recited, supra, we have found occasion to reverse the denial of summary judgment. See Presbyterian University Hospital v. Wilson, 99 Md.App. 305 , 637 A.2d 486 (1994), aff'd, Presbyterian University Hospital v. Wilson, 337 Md. 541 , 654 A.2d 1324 (1995). In Wilson, we determined that, in a case where the issue is purely one of law, that could not properly be submitted to the trier of fact for resolution, it is appropriate for us to review the trial court’s denial of summary judgment. 99 Md.App. at 313-14 , 637 A.2d 486 . In that case, the issue of lack of personal jurisdiction was submitted as part of a summary judgment motion, which the trial court denied.

Id. at 310 , 637 A.2d 486 . The appellees in Wilson argued that Basiliko limited our review to abuse of discretion on the part of the trial court. Id. at 311, 637 A.2d 486 . We determined, however, and the Court of Appeals agreed, see Wilson, 337 Md. at 548-59 , 654 A.2d 1324 , that the motion for summary judgment was in effect an ³⁰⁵ extension of Presbyterian’s motion to dismiss for lack of personal jurisdiction, which was reviewable on appeal.

Id. at 314-15, 637 A.2d 486 . We noted in Manown v. Adams, 89 Md.App. 503 , 598 A.2d 821 (1991), however, that it is a rare circumstance for an appellate court to reverse a trial court’s denial of a summary judgment motion after there has been a full trial on the merits. Id. at 514 , 598 A.2d 821 , vacated 328 Md. 463 , 615 A.2d 611 (1992). In vacating our decision in Adams , the Court explained: Given that a circuit court has the discretion to deny a motion for summary judgment, even though the record on summary judgment would support grant[ing] of the motion at that time, the correct mode of analysis here is to determine whether the party moving for judgment at the conclusion of trial is entitled to judgment as a matter of law on the record as it stands at that time.

Manown, 328 Md. at 472 n. 4, 615 A.2d 611 . The rationale which undergirds our resistance to reverse a trial court’s denial of a summary judgment motion was explained by Judge Digges in Basiliko . If after a full evidentia-ry hearing, in which the party opposing a summary judgment prevails on the merits, were we to reverse, in essence "that “would be nothing short of substituting a known unjust result for a known just one.” Basiliko, 288 Md. at 29 , 415 A.2d 582 . 4 ³⁰⁶ Appellants tell us that ruling on the motion for summary judgment is compulsory upon the trial court. They insist that there is no rule nor provision of law that allows the court the discretion to “reserve” ruling on a motion for summary judgment.

Basiliko, Manown, Wilson and decisions cited therein, supra, hold otherwise. The trial court is not only vested with the discretion to reserve ruling or forego ruling on the motion entirely, but that discretion exists even where a party meets all the technical requirements for summary judgment. This principle holds true even where, as appellant claims here, there are no disputes as to a material fact. See Porter Hayden Company v. Commercial Union Insurance Co., 339 Md. 150, 164 , 661 A.2d 691 (1995).

Accepting our initial premise that the trial court’s refusal to rule on the motion was effectively a denial, such a refusal is only reviewable upon an abuse of discretion standard. We perceive no such abuse of discretion in this case. The denial of the motion for summary judgment did not preclude appellants from defending their case on the merits, nor were they prevented from placing the evidence offered in support of their motion for summary judgment before the jury. More importantly, appellants’ motion for summary judgment presented factual issues, rather than pure questions of l%w, properly submitted to a trier of fact — in this instance, a jury — for determination.

To further support their claim that the trial court’s refusal to rule on their summary judgment motion constituted error, appellants allude to appellee’s failure to respond to their motion. The failure to contradict facts recited in appellants’ affidavits constitutes an admission of those facts for purposes of summary judgment. See Roe v. Citizens National Bank, 32 Md.App. 1, 11 , 358 A.2d 267 (1976). Because there was no response to the motion by appellee, appellants conclude that summary judgment was necessary.

The record reflects that, at the time the trial court declined to rule on the motion in favor of proceeding to trial on the merits, the following day was the deadline for appellee to submit his opposition to the ³⁰⁷ motion. Because of the confusion stemming from the scheduling order, the trial court had instructed appellee that he was not required to respond to the motion. We need not reach the question whether the court’s action in excusing appellee’s obligation to respond was appropriate. It certainly was reasonable for appellee’s counsel to rely on the court’s decision.

Finally, appellants assert that the trial court’s failure to rule on their motion violated their Fourteenth Amendment substantive due process rights, in that, the trial court’s actions render the law on summary judgment impermissibly meaningless and vague. They seek solace in the opinions rendered by the Court of Appeals in Ferro v. Lewis, 348 Md. 593 , 705 A.2d 311 (1998) and