Medical Mutual Liability Insurance Society v. B. Dixon Evander & Associates

ELDRIDGE, Judge. The respondents, B. Dixon Evander & Associates, Inc. (Evander, Inc.), an insurance agency owned by Mr. Evander, and Mr. Evander individually, filed in the Circuit Court for Baltimore City a complaint against the petitioners, Medical Mutual Liability Insurance Society of Maryland and its chairman and chief executive officer, Raymond M. Yow, M.D. 1 Both Evander, Inc. and Mr. Evander sought damages from Medical Mutual and Dr. Yow in four counts. 2 Each count was ³⁰⁴ on behalf of both plaintiff's against both defendants. Count I was based upon defamation; Count II was based upon tortious interference with business relationships; Count III was based upon “tortious interference with prospective advantage” and Count IV was based upon “injurious falsehood.” The factual predicate for all four counts was a letter written by Dr. Yow on behalf of Medical Mutual to its policyholders brokered by Evander, Inc., informing the insureds that Medical Mutual would no longer accept new business or renewal business from Evander, Inc. Specifically, the plaintiffs asserted that a particular statement in the letter caused harm. The statement in the “Dear Colleague” letter was as follows: “I have listened to members over the past months, and it has become apparent that a few brokers are no longer representing Medical Mutual in a way that many of you feel to be adequate.” Following a six-day trial, which the Court of Special Appeals later characterized as being “dominated” by the above-quoted statement from the letter, 3 the trial court submitted the case to the jury on two counts, defamation and tortious interference with business relationships. 4 The verdict sheet asked the jury to consider, inter alia, the following questions: ³⁰⁵ “1.

Do you find for plaintiffs on their claim for defamation against Medical Mutual? “2. Do you find for plaintiffs on their claim for defamation against Raymond M. Yow? “3. Do you find for plaintiffs on their claim for tortious interference with business relationship against Medical Mutual? “4. Do you find for plaintiffs on their claim for tortious interference -with business relationships against Raymond M. Yow?” The jury failed to reach a verdict on the defamation count, and a mistrial was declared.

The jury found for the plaintiffs against the defendants on the count of tortious interference with business relationships, awarded $1,725 million in compensatory damages, 5 awarded $5 million in punitive damages against Medical Mutual, and awarded $2 million in punitive damages against Dr. Yow. At plaintiffs’ request, the trial court in an order dated November 1, 1991, purported to make the appropriate certification and to direct the entry of a final judgment pursuant to Maryland Rule 2-602 “as to the claims set forth” in the “judgment on the verdict in favor of the plaintiffs.” No further action was taken on the defamation count. Medical Mutual noted an appeal, and the case was briefed and argued in the Court of Special Appeals. Without address ³⁰⁶ ing or apparently noticing an issue concerning the finality and appealability of the “judgment,” the Court of Special Appeals purported to vacate the punitive damages awards, to affirm the “judgment” in all other respects, and to remand the case to the circuit court for further proceedings.

Medical Mutual v. Evander, 92 Md.App. 551 , 609 A.2d 353 (1992). Medical Mutual thereafter filed a petition for a writ of certiorari, which was denied, 328 Md. 447 , 614 A.2d 973 . After reconsideration, the trial court, refusing to reduce the amount of punitive damages awarded by the jury, reaffirmed its prior action by denying Medical Mutual’s “Motion for New Trial and for Remittitur.” Medical Mutual again noted an appeal to the Court of Special Appeals and, prior to any proceedings in the intermediate appellate court, filed in this Court a petition for a writ of certiorari. The petition raises issues with respect to both the compensatory and punitive damages awarded by the jury.

Plaintiffs answered the petition on its merits. Prior to acting on the petition, this Court ordered the parties to address, by memoranda of law, the following issue: “Whether the trial court’s certification of the judgment as final under Rule 2-602(b) was a valid certification or whether the unresolved defamation count, and the adjudicated tortious interference with business relationship count were actually a single claim, rendering the certification improper under Rule 2-602(b).” 6 We referred the parties to the following opinions of this Court: Planning Board v. Mortimer, 310 Md. 639, 649-651 , 530 A.2d 1237, 1240-1243 (1987); Washington Sub. San. Comm’n v. Frankel, 302 Md. 301, 307-309 , 487 A.2d 651, 655 (1985); Potter v. Bethesda Fire Dept., Inc., 302 Md. 281, 285-287 , 487 ³⁰⁷ A.2d 288, 290-291 (1985); East v. Gilchrist, 293 Md. 453, 458-462 , 445 A.2d 343, 345-346 (1982); Biro v. Schombert, 285 Md. 290, 293-297 , 402 A.2d 71, 73-74 (1979); Diener Enterprises v. Miller, 266 Md. 551, 554-556 , 295 A.2d 470, 473 (1972).

The parties have filed memoranda addressing this question. Medical Mutual argues that “[b]oth counts were based upon a single factual occurrence—the issuance of the allegedly defamatory letter—and both counts sought a single recovery—compensation for lost business revenues caused by the alleged defamation.” Relying on the above cited Maryland cases, Medical Mutual concludes that “the unresolved defamation count and the adjudicated tortious interference with business relationship count were in fact a single claim, and thus the trial court’s certification of the adjudicated count as a final judgment under Rule 2-602(b) was improper.” Although plaintiffs do not contend that the defamation and tortious interference counts were based on any facts other than the distribution of the “Dear Colleague” letter, plaintiffs argue that the counts constitute separate claims because they “sought different recoveries and were not mutually exclusive.” With respect to the argument that each count sought different damages, plaintiffs refer to the jury instructions with regard to the damages for each count, stating that “Evander sought recovery in his defamation claim for out-of-pocket loss, loss of reputation, and personal humiliation and embarrassment, and that in his tortious interference claim he sought recovery for the destruction of his business.” 7 Consequently, plaintiffs conclude that the certification was proper. After consideration of the arguments submitted by the parties, we have granted the certiorari petition, and, for the reasons hereafter set forth, we shall dismiss the appeal. Rule 2-602 provides as follows: ³⁰⁸ “(a) Generally.—Except as provided in section (b) of this Rule, an order or other form of decision, however designated, that adjudicates fewer than all of the claims in an action (whether raised by original claim, counterclaim, cross-claim, or third-party claim), or that adjudicates less than an entire claim, or that adjudicates the rights and liabilities of fewer than all the parties to the action: (1) is not a final judgment; (2) does not terminate the action as to any of the claims or any of the parties; and (3) is subject to revision at any time before the entry of a judgment that adjudicates all of the claims by and against all of the parties. “(b) When Allowed.—If the court expressly determines in a written order that there is no just reason for delay, it may direct in the order the entry of a final judgment: (1) as to one or more but fewer than all of the claims or parties; or (2) pursuant to Rule 2-501(e)(3), for some but less than all of the amount requested in a claim seeking money relief only.” It is undisputed that under this rule, a trial court can only certify as final a judgment that, “but for multi-party or multiclaim circumstances, would be final in the traditional sense.” Planning Board v. Mortimer, supra, 310 Md. at 649 , 530 A.2d at 1242 .

Therefore, although the trial court in the present case expressly determined that there was no just reason for delay and purported to direct the entry of a final judgment, the trial court would not be authorized to finalize an order unless, by its nature, that order was final as to a single claim or party. “ ‘Such a finding only makes a final order appeal-able. It cannot make a nonfinal order ... into a final order.’ ” Planning Board v. Mortimer, supra, 310 Md. at 654 , 530 A.2d at 1245 , quoting Jursich v. Arlington Heights Fed. Sav. & Loan Ass’n, 83 Ill.App.3d 352 , 38 Ill.Dec. 656 , 403 N.E.2d 1260 (1980). As stated in Snowden v. Baltimore Gas & Electric, 300 Md. 555, 563 , 479 A.2d 1329, 1333 (1984), “the authoriza ³⁰⁹ tion ... for trial judges to make certain orders appealable, is limited to orders which, by their nature, have a characteristic of finality. Such orders must be completely dispositive of an entire claim or party.” See also Keene Corp. v. Levin, 330 Md. 287, 292 , 623 A.2d 662, 664 (1993); East v. Gilchrist, supra, 293 Md. at 458 , 445 A.2d at 345 ; Biro v. Schombert, supra, 285 Md. at 294 , 402 A.2d at 74 .

This Court has repeatedly held that “ ‘[a]n order which disposes of only a part of a single claim cannot be made final’ ” under Rule 2-602 or its predecessor rule. East v. Gilchrist, supra, 293 Md. at 458 , 445 A.2d at 345 , quoting Biro v. Schombert, supra, 285 Md. at 294 , 402 A.2d at 74 . See also, e.g., Keene Corp. v. Levin, supra, 330 Md. at 292-293 , 623 A.2d at 664-665 ; Planning Board v. Mortimer, supra, 310 Md. at 654 , 530 A.2d at 1245 ; Washington Sub. San.

Comm’n v. Frankel, supra, 302 Md. at 308-309, 487 A.2d at 655 ; Snowden v. Baltimore Gas & Electric, supra, 300 Md. at 560 , 479 A.2d at 1332 ; Lewis v. Lewis, 290 Md. 175, 181 , 428 A.2d 454, 458 (1981); Diener Enterprises v. Miller, supra, 266 Md. at 554-555 , 295 A.2d at 473 . The parties do not challenge these holdings. Rather, the disputed issue is whether the defamation and tortious interference counts constitute one claim. In Diener Enterprises v. Miller, supra, 266 Md. at 556 , 295 A.2d at 473 , this Court examined the requirements for separate claims for purposes of what is now Rule 2-602, stating: “[Wjhere a claimant presents a number of legal theories, but will be permitted to recover on at most one of them, his possible recoveries are mutually exclusive, and he has but a single claim for relief.

The existence of multiple claims ultimately depends upon whether the ‘aggregate of the operative facts’ presented states more than one claim which can be separately enforced.” See also, e.g., Planning Board v. Mortimer, supra, 310 Md. at 651 , 530 A.2d at 1243 ; Potter v. Bethesda Fire Dept., Inc., supra, 302 Md. at 286, 487 A.2d at 290; Biro v. Schombert, supra, 285 Md. at 295 , 402 A.2d at 74 ; Harford Sands, Inc. v. Levitt & Sons, 27 Md.App. 702, 708 , 343 A.2d 544, 547 , cert. ³¹⁰ denied, 276 Md. 744 (1975) (“a claim for purposes of [Rule 2-602 is] a set of facts giving rise to a legal right”). When two counts are based upon the same facts, and merely represent different legal theories upon which the plaintiff can recover the same damages, the counts constitute a single claim. See East v. Gilchrist, supra, 293 Md. at 459 , 445 A.2d at 346 (“Different legal theories for the same recovery, based on the same facts or transaction, do not create separate ‘claims’ for purposes of the rule”); Biro v. Schombert, supra, 285 Md. at 295 , 402 A.2d at 74 (alternate legal theories “based upon one matter or transaction” do not give rise to separate claims); Diener Enterprises v. Miller, supra, 266 Md. at 556 , 295 A.2d at 473 (“the ‘claims’ stated by using two counts is actually but one claim that was framed in two ways so as to present either one of two legal theories for one recovery”); Harford Sands, Inc. v. Levitt & Sons, supra, 27 Md.App. at 711 , 343 A.2d at 547 . In this case, the counts of defamation and tortious interference with business relationships were based upon identical facts.

As the Court of Special Appeals stated, one sentence in the letter sent to the insureds “dominated” the trial. In fact, the trial court at one point stated: “If the verbal conduct is not defamatory, it’s not wrongful, and if its not wrongful, both counts fall, both the defamation and the tortious interference ... I mean, I’ve looked at this whole case from the beginning as a case of defamation, and I’ve looked at the multiple counts as different ways to state the cause of action for the same conduct, and indeed that has been the plaintiffs explanation of what the plaintiff was doing ... I am satisfied that there’s no such thing as a separate defamation count and a wrongful interference count based upon defamatory conduct.” Also, in his closing statement, plaintiffs’ counsel advised the jury that “[t]he intentional interference with contract is really based upon the defamation.” As all parties concede, there are no other facts upon which the counts for defamation or tortious interference were grounded. ³¹¹ At trial, plaintiffs’ counsel acknowledged that the damages were essentially the same in the following colloquy with the trial judge: “THE COURT: How can the damages be different for the defamation count from the tortious interference count?

PLAINTIFFS’ COUNSEL: Your honor, I agree with you that from a lawyer’s perspective, I think all three of us are thinking that if there’s damage ... it ought to be the same for any count---- THE COURT: I mean I really think this is a one count, this is a one count case.” Plaintiffs rely on the jury instructions to argue that the count of defamation and the count of tortious interference are separate claims. The circuit court instructed the jury as follows: “If you find that the plaintiffs were defamed, they are