McReady v. University System

EYLER, DEBORAH S., J. In three cases, Edward C. McReady, the appellant, has challenged dismissals by the Circuit Court for Montgomery County of his actions for judicial review against the University of Maryland (“the University”), the appellee. His cases originated as complaints under the Maryland Whistleblower Law (“MWL”), Md.Code (1993, 2009 RepLVol.), sections 5-301 et seq. of the State Personnel and Pensions Article (“SPP”), which were referred to the Office of Administrative Hearings (OAH) for decision by an Administrative Law Judge (“ALJ”). The cases have been consolidated in this Court. McReady poses six questions for review, which constitute arguments on ²²⁷ the single question whether the circuit court erred in dismissing the actions for judicial review. 1 For the following reasons, we hold that the court erred in dismissing the actions.

Accordingly, we shall reverse the judgments of the circuit court. FACTS AND PROCEEDINGS The issues in this case are procedural in nature and therefore it is not necessary to delve into the specifics of McReady’s complaints. The following skeletal summary will do. McReady was employed as an accounting professor at the School of Undergraduate Studies of the University of Maryland University College, which is part of the University.

On June 21, 2007, he received notice that his contract, which was set to expire on June 30, 2008, would not be renewed. Thereafter, on August 24, 2007, he was terminated from his position. McReady filed grievances with the University, arguing in part that the non-renewal of his contract and his ultimate termination were in retaliation for his exercise of his constitutional right to free speech. The grievances were decided against him.

On March 17, 2008, and June 5, 2008, McReady filed complaints under the MWL with the Department of ²²⁸ Management and Budget (“DBM”). The DBM ruled that the complaints were not timely filed. McReady appealed those decisions to the OAH. The University filed a motion to dismiss on the issue of timeliness of the March 17, 2008 complaint.

An ALJ with the OAH held a hearing on the motion, which consisted solely of argument of counsel. 2 On August 12, 2008, the ALJ issued an order ruling that the March 17, 2008 MWL complaint was untimely. 3 In the Circuit Court for Montgomery County, McReady filed an action for judicial review, challenging that order. On September 18, 2008, after another non-evidentiary hearing on a motion to dismiss filed by the University, the ALJ issued a second order ruling that McReady’s June 5, 2008 MWL complaint likewise was untimely. McReady filed a second action for judicial review from that order, in the same circuit court. In the two actions for judicial review, the clerk’s office, within a month of filing, mailed notice of the actions to the OAH.

Pursuant to Rule 7-206(c), the 60-day period for the OAH to file the records in those appeals started to run on the dates of the letters (October 10 and October 20, 2008). Initially, separate judges were assigned to the cases. They each sent letters to the parties explaining that the proceedings would be governed by Title 7 of the Maryland Rules of Procedure. Ultimately, both cases were assigned to one judge, who sent the parties a “timetable to use as a guide in accordance with Rule 7-200 et seq.” and scheduled a hearing date of February 27, 2009, in both cases.

On November 5, 2008, with respect to McReady’s first action for judicial review, Linda Bailey, the docket clerk for the OAH, wrote to McReady detailing what was to be the “Record” in the actions for judicial review, under Rule 7-206. Her letter quoted a prior version of the rule, which is not in any significant way different from the existing rule. The quotation in the letter included part (a) of the Rule, stating: ²²⁹ Contents; expense of transcript—The record shall include the transcript of testimony and all exhibits and other papers filed in the agency proceeding, except those papers the parties agree or the court directs may be omitted by written stipulation or order included in the record. If the testimony has been recorded but not transcribed before the filing of the petition for judicial review, the first petitioner, if required by the agency and unless otherwise ordered by the court or provided by law, shall pay the expense of transcription, which shall be taxed as costs and apportioned as the court directs.[ 4 ] Bailey’s letter went on to quote the remaining four subsections of the rule, which, respectively, provide that the parties may agree to proceed by means of a statement in lieu of the record; that, except as otherwise provided, the agency is required to submit to the court clerk the original or a certified copy of the record within 60 days of its receipt of the petition in the action for judicial review; that that time period could be shortened or extended by the court, upon motion, and that “[t]he action shall be dismissed if the record has not been transmitted within the time prescribed unless the court finds that the inability to transmit the record was caused by the act or omission of the agency, a stenographer, or a person other than the moving party,” see subsection (d); and that upon the filing of the record the clerk of court is required to notify the parties that the record has been filed.

Bailey’s letter to McReady stated, with respect to the transcript: It is the responsibility of the party who first filed the petition for review to order a transcription of the tape-recorded record of the hearing, and to pay the expense of transcribing the hearing, if the parties have not agreed upon ²³⁰ a statement in lieu of the record. See COMAR 17.02.03.07. The cost of transcribing the tape-recorded hearing is $3.35 per page. The letter further stated that to insure that the tape-recorded record was timely transcribed and transmitted to the court, McReady needed to immediately remit $971.50 to George Quade, Project Coordinator for For the Record, Inc. (with address included), and to ask Quade to forward the original and two copies of the transcript to her attention.

The letter concluded by stating: YOU ARE RESPONSIBLE FOR COMPLIANCE WITH ALL APPLICABLE REQUIREMENTS OF THE MARYLAND RULES. IF THE RECORD IS NOT COMPLETES [sic] BY PROMPTLY SUBMITTING EITHER A TRANSCRIPT OR A STATEMENT IN LIUE [sic ] OF THE RECORD, YOUR APPEAL WILL NOT PROCEED. On the same date, Bailey sent McReady an identical letter regarding his second action for judicial review. The only difference between the letters was that the amount owed for the transcription of the record in the second action for judicial review was $1,494.10.

On November 7, 2008, McReady wrote to the ALJ who had presided over the hearings in the two cases seeking clarification of his obligation to pay for the cost of transcripts and asking that the November 5, 2008 letters by Bailey be rescinded. He argued that, because the OAH decisions had been made on motion, and the hearings that had been held consisted of argument, not testimony, the hearings did not need to be transcribed. On November 10, 2008, Thomas E. Dewberry, Chief ALJ at the OAH, responded to McReady, disagreeing with his argument, and explaining, in part: When an appeal is filed, the entire record of that proceeding must be transmitted to the circuit court, and the record includes such things as the evidence, argument, etc. presented at a motion(s) hearings, among other records. The ²³¹ records of the motion(s) hearings in these particular cases are extremely pertinent because it is my understanding that the rulings on the motions form the basis of your appeal.

Therefore, the Maryland Rules require a transcription of the testimony in the hearing for review by the court. Although the Maryland Rules do not specifically define the term testimony, I do not believe that it is as restrictive a definition as you have offered, and believe it would include the arguments on the motion(s). Dewberry’s letter emphasized that it remained McReady’s obligation to order and pay for the transcripts of the hearings and that if he did not do so, his actions for judicial review would be dismissed. According to McReady, on November 14, 2008, he wrote to Dewberry requesting reconsideration, which was denied by letter of November 17, 2008. 5 On October 22, 2008, in the second OAH case, the ALJ revised his original order and dismissed some but not all of McReady’s MWL claims.

On November 17, 2008, McReady filed a third action for judicial review in the circuit court, challenging that decision. McReady refused to pay for any OAH hearing transcripts associated with his actions for judicial review on the ground that, because there was no “testimony” taken in the proceedings before the ALJ, in that the cases were decided on motion, with only argument being advanced, the transcripts were not part of the OAH record that was required to be transmitted to the circuit court pursuant to Rule 7-206. On December 1, 2008, he filed a motion for “compliance,” seeking to have the OAH comply with Rule 7-206 by filing the records in the cases without the hearing transcripts. There was no opposition to the motion, and, as the court did not rule on it before the 60-day deadlines by which the records in the first two cases were to be filed, the motion was implicitly denied.

Those 60-day periods expired on December 15 and 22, 2008, respectively. The records were not transmitted. ²³² The 60-day deadline in the third case was to expire on January 19, 2009. On January 15, 2009, the OAH filed a “Certificate of Record” for each case stating that it was filing a “partial record,” which included the written decisions by the ALJ and the exhibits that had been presented to the ALJ, and that it would forward the hearing transcripts when they were received. (Of course, the transcripts would not be received by the OAH until they had been prepared, and they would not be prepared until they were paid for; and McReady still would not pay for the transcripts.) McReady filed unsuccessful motions to revise the scheduling order, which applied to all three eases.

He did not file any Rule 7-207 memoranda. The Rule 7-208 hearing on the three cases remained scheduled for February 27, 2009. McReady was sent notices from the clerk’s office and a letter from the judge assigned to the cases reminding him of that hearing date. There is no indication in the record that the notices or letter were not received.

On February 27, 2009, counsel for the University appeared before the court for the Rule 7-208 hearing. The judge and University counsel waited for almost an hour for McReady to appear, but he did not do so. Counsel for the University orally moved to dismiss the actions for judicial review on the primary ground that the OAH transcripts never had been prepared and therefore were not included in the record as required, he argued, by Rule 7-206(a). Counsel also included as reasons for dismissal that McReady had not submitted a memorandum in accordance with Rule 7-207 and had failed to appear at the hearing.

The court granted the motion to dismiss with prejudice in all three actions for judicial review, on all grounds raised by University counsel. The orders granting the motions to dismiss the actions for judicial review were not docketed until March 19, 2009. That same day, McReady filed a motion to vacate. On April 17, 2009, he filed a notice of appeal.

In an unreported opinion, this Court dismissed the appeal as not having been taken from a final judgment, as the motion to vacate, having been filed ²³³ within 10 days of the entry of the dismissal orders, had undone their finality. McReady v. Univ. Sys. of MD., No. 231, September Term 2009 (Md. Ct. Spec.App. filed May 14, 2010). On August 26, 2010, after remand from this Court, the circuit court denied the motion to vacate.

This appeal then timely followed. DISCUSSION Before examining McReady’s contention that the circuit court erred in dismissing his actions for judicial review, we shall discuss generally the statutory and regulatory scheme and the court rales governing the proceedings. An MWL complaint is brought under and governed by SPP title 5, subtitle 3 (sections 5-301 through 5-313). SPP section 5-303 provides that the Secretary of DBM shall adopt regulations for processing and resolving such complaints.

Under SPP section 5-309, a complaint is filed with the Secretary, and the Secretary or his or her designee investigates and issues a written decision, which shall include any remedial action to be taken. Pursuant to SPP section 5-310(a), a complainant who is aggrieved by the Secretary’s decision may appeal it to the OAH. SPP section 5-310(b) provides that the OAH shall conduct a hearing in accordance with Md.Code (1984, 2009 RepLVol.), title 10, subtitle 2 of the State Government Article (“SG”), which is the Maryland Administrative Procedure Act (“APA”), and the OAH “is bound by any regulation, declaratory ruling, prior adjudication ... to the same extent as the [DBM] is or would have been bound if it were hearing the case.” The OAH must issue a written decision, and that decision is the final agency decision in the matter. SPP § 5-310(c).

Judicial review of the OAH’s decision may be had in accordance with SG section 10-222. SPP § 5-310(e). The DBM regulations that apply to MWL complaints appear at COMAR 17.04.08.05 through .07. Regulation .06 concerns the Secretary’s'investigation of the complaint and issuance of findings.

Regulation .07 concerns the appeal that can be taken from the decision of the Secretary to the OAH. ²³⁴ Subsection (D) of that regulation states that any hearing that is conducted before the OAH in such an appeal shall be held in accordance with the APA and SPP section 5-310. The OAH regulations that are promulgated pursuant to the APA appear at COMAR 28.02.01 et seq. Regulation .01.12 governs “Motions.” Subsection B(4) states that “[u]pon notice to all parties, the [ALJ] may schedule a conference to consider a written motion.” Subsection B(5) further states that the ALJ “may issue a written decision on a motion or state the decision on the record.” Subsection D, which concerns motions for summary decision, says nothing about hearings. Finally, Regulation .01.22B states that the OAH “record” shall include “(9) The recording of the hearing, and any prehearing proceeding, and any transcript of the recording prepared by a court reporting service.... ” The provisions that govern actions for judicial review of final agency decisions appear in Title 7, Chapter 200 of the Maryland Rules of Procedure.

We already have reviewed Rule 7-206, which is entitled “Record.” As pertinent here, it requires at section (a) that “[t]he record shall include the transcript of testimony and all exhibits and other papers filed in the agency proceeding” except those that are to be omitted by agreement or court order. (Emphasis added.) It further directs that, “[i]f the testimony has been recorded but not transcribed before the filing of the petition for judicial review, the first petitioner, if required by the agency and unless otherwise ordered by the court or provided by law, shall pay the expense of transcription.... ” (Emphasis added.) Generally, and as applicable to this case, pursuant to subsection (c) of the Rule, the record must be transmitted to the clerk of court within 60 days after the agency receives the first petition for judicial review. Rule 7-207, governing memoranda in actions for judicial review, provides as pertinent here: Within 30 days after the clerk sends notice of the filing of the record, a petitioner shall file a memorandum setting forth a concise statement of the questions presented for ²³⁵ review, a statement of facts material to those questions, and argument on each question, including citations of authority and references to pages of the record and exhibits relied on. Rule 7-208(a) provides that, unless waived in writing by the parties, “the court shall hold a hearing.” The hearing is to be scheduled “upon the filing of the record pursuant to Rule 7-206,” and, “[ujnless otherwise ordered by the court or required by law, the hearing shall be no earlier than 90 days from the date the record was filed.” Rule 7-208(b).

McReady’s contention that the circuit court erred in dismissing his actions for judicial review is comprised of the following arguments. First, based on Rule 7-206(a), the “record” in these actions for judicial review did not include transcripts of the hearings held before the ALJ on the motions to dismiss, as no “testimony” was taken; therefore, he was not required to pay for those transcripts and the OAH was required to transmit the record, as defined by Rule 7-206, to the circuit court without the transcripts. In the first two cases, the OAH failed to file the record by the 60-day deadline established by Rule 7-206(c). Its reason for doing so—that transcripts of the motions hearings were not ordered and obtained, and the transcripts were required to be part of the record—was erroneous.

McReady maintains that the court should not have dismissed his actions for judicial review for failure to file the record because it was OAH’s failure, not his. 6 Second, McReady asserts that the circuit court erred in issuing a scheduling order, before the record was filed, that directed when he had to file his Rule 7-207 memorandum and setting a date for the Rule 7-208 hearing, because the record never was filed in the first two cases, and Rules 7-207 and 7-208 tie the dates for a memorandum to be filed and for a hearing to be held to the filing of the record. ²³⁶ Third and fourth, McReady argues that the court erred in dismissing his actions for judicial review for failure to file a memorandum and for failure to appear at the hearing because the obligation to file a memorandum and the scheduling of a hearing are tied to the receipt by the court of the record, which in this case was the OAH record in each case. In the first and second cases, the OAH did not timely transmit any record; therefore, he was not obligated to file a memorandum and the court should not have scheduled a hearing. In addition, the court never ruled on his motion to vacate the scheduling order, which should have been granted, as the timetable for filing a Rule 7-207 memorandum and for the Rule 7-208 hearing was tied to receipt of the record, and the agency record had not been received in the first two cases. In addition, upon receipt of what the OAH referred to as a “partial record” in the third action for judicial review, the clerk’s office issued amended notices (on January 26, 2009) stating that upon receipt of the entire records in the cases, notices in accordance with Maryland Rule 7-206(e), i.e., the notice the clerk’s office must send of the filing of the record, “will be mailed.” 7 Thus, even though the OAH filed what it contended was a “partial record” in the third case, which it also referenced, retroactively, to the first two cases, in which the records already had not been timely filed, the notice from the clerk’s office made clear that the record was not considered to have been received, and therefore the time for filing a Rule 7-207 memorandum and for scheduling a Rule 7-208 hearing had not been triggered.

The University responds as follows to McReady’s arguments. First, it maintains that under the plain language of Rule 7-206(d), “[t]he action [for judicial review] shall be dismissed if the record has not been transmitted” within 60 ²³⁷ days, and, although the agency is responsible for transmitting the