Neal v. Balt. City Brd. of School Commissioners

Starr Neal, et al. v. Baltimore City Board of School Commissioners, No. 21, September Term, 2019. Opinion by Getty, J. SOVEREIGN IMMUNITY STATUTORY WAIVER—INDEMNIFICATION The Court of Appeals held that for the purpose of indemnifying a defendant county school board employee, the plain language of Courts and Judicial Proceedings Article § 5-518 requires joinder of a county board of education in the litigation at all times, even if the board has for all other purposes been substantively dismissed. Circuit Court for Baltimore City Case No. 24-C-16-002208 Argued: October 8, 2019 IN THE COURT OF APPEALS OF MARYLAND No. 21 September Term, 2019 STARR NEAL, et al. v. BALTIMORE CITY BOARD OF SCHOOL COMMISSIONERS Barbera, C.J. McDonald, Watts, Hotten, Getty, Booth, Greene, Clayton, Jr., (Senior Judge, Specially Assigned) JJ. Opinion by Getty, J. Pursuant to Maryland Uniform Electronic Legal Materials Act (§§ 10-1601 et seq. of the State Government Article) this document is authentic.

Filed: February 28, 2020 2020-02-28 11:40-05:00 Suzanne C. Johnson, Clerk As every bleacher fan and every Monday morning quarterback knows, it is easy to second guess any given situation. Judge Marvin H. Smith, Wooddy v. Mudd, 258 Md. 234, 251 (1970). In executing his trial strategy in a case against the Baltimore City Board of School Commissioners (the “Board”) for an incident involving a school police officer, Plaintiffs’ counsel made the decision to not appeal the summary judgment dismissal of the Board from the case and to avoid joinder of the Board until after the trial’s conclusion. That decision was the result of counsel’s misunderstanding of § 5-518 of the Courts and Judicial Proceedings Article (“CJ”), (1990, 2013 Repl.

Vol.) and the Maryland Rules of Civil Procedure. Section 5-518 requires joinder of a county school board to an action against a county board employee that alleges damages resulting from a tortious act or omission committed by the employee in the scope of employment. Now, from the post-judgment vantage point of a Monday morning quarterback, the parties dispute whether the school board in this case is liable for a judgment against its employee when the board was dismissed from the case prior to trial. We hold that even if a board is entitled to substantive dismissal from a case by summary judgment or otherwise, the plaintiffs are required under § 5-518 to keep the board as a party—or request that it be brought back into the case—in order for the board to be required to indemnify an employee.

In the event a board is dismissed, the plain language of § 5-518 requires a plaintiff to (1) request that a board be brought back into a case for the purposes of indemnification; or (2) at the appropriate time, appeal a circuit court order that otherwise dismisses a board prior to or during trial. Plaintiffs’ counsel below did not properly follow the plain language directives of § 5-518 either by requesting that the Board be brought back in after summary judgment or by appealing the summary judgment ruling. Due to these § 5-518 procedural errors, the Board is not required to satisfy the judgment. BACKGROUND A. Courts and Judicial Proceedings Article § 5-518.

This dispute is grounded in a fundamental disagreement about the operation of § 5- 518 in the context of mandatory joinder. We start by noting that the discussion in this opinion is limited to the application of § 5-518 to “county board employees.” The statute treats differently “board members” and “volunteers” in ways that are beyond the scope of this opinion. At the relevant time,1 § 5-518 provided: (b) A county board of education, described under Title 4, Subtitle 1 of the Education Article, may raise the defense of sovereign immunity to any amount claimed above the limit of its insurance policy or, if self-insured or a member of a pool described under § 4-105(c)(1)(ii) of the Education Article, above $100,000. (c) A county board of education may not raise the defense of sovereign immunity to any claim of $100,000 or less. 1 In 2016, the General Assembly amended § 5-518, increasing the extent of the waiver of sovereign immunity to reach claims up to $400,000. 2016 Md. Laws, ch. 680 §§ 1, 3.

The Act took effect October 1, 2016 and is “construed to apply only prospectively and may not be applied or interpreted to have any effect on or application to any cause of action before the effective date of [the] Act.” Id. §§ 2, 3. The relevant events in this case occurred in 2014 and the complaints were filed in April 2016, therefore we apply the law as it existed before Chapter 680 became effective. 2 (d)(1) The county board shall be joined as a party to an action against a county board employee . . . that alleges damages resulting from a tortious act or omission committed by the employee in the scope of employment . . . . (2) The issue of whether the county board employee acted within the scope of employment may be litigated separately. *** (e) A county board employee acting within the scope of employment, without malice and gross negligence, is not personally liable for damages resulting from a tortious act or omission for which a limitation of liability is provided for the county board under subsection (b) of this section, including damages that exceed the limitation on the county board’s liability. *** (h) Except as provided in subsection (e) . . . of this section, a judgment in tort for damages against a county board employee acting within the scope of employment . . . shall be levied against the county board only and may not be executed against the county board employee, the county board member, or the volunteer personally. CJ § 5-518.

The core of the statutory scheme is § 5-518(c), which makes a county school board potentially liable through a limited waiver of sovereign immunity. The Court recently made clear that a county school board is, in certain contexts, an arm of the State. See Donlon v. Montgomery Cty. Pub.

Sch., 460 Md. 62 , 80–82 (2018). Sovereign immunity is one such context in which a county school board is considered an arm of the State. Id. at 80–81, 86–88, 94; Beka Indus., Inc. v. Worcester Cty. Bd. of Educ., 419 Md. 194, 210 (2011).

The State and its agents have sovereign immunity from common law tort actions except to the extent that the Legislature has waived that immunity. Estate of Burris v. State, 360 Md. 721, 736 (2000) (citing Kee v. State Highway Admin., 313 Md. 445 , 455 3 (1988)). Absent a statutory waiver, therefore, county school boards and their employees and agents have complete immunity from tort claims. Section 5-518(c) provides a statutory waiver for claims up to, at the relevant time, $100,000.

Section 5-518(b) provides that county school boards maintain complete sovereign immunity for claims above that amount. Section 5-518(d) requires joinder of a county school board in an action against any board employee “that alleges damages resulting from a tortious act or omission committed by the employee in the scope of employment.” CJ § 5-518(d)(1). In this context, the purpose of mandatory joinder is to place the board on notice that it must satisfy a judgment against an employee. Notably, as to joinder, § 5-518(d)(1) does not have any qualified language—rather it has mandatory language: the board “shall be joined” in any action against a board employee where tortious acts or omissions within the scope of employment allegedly damaged the plaintiff.

CJ § 5-518(d)(1) (emphasis added). Even if the board is properly joined, its responsibility to satisfy a judgment depends on “whether the county board employee acted within the scope of employment.” CJ § 5- 518(d)(2). Such a question may be litigated separately from the underlying action. Id.

Sections 5-518(e) and (h) proceed to lay out protections for board employees. First, a board employee, acting within the scope of her employment, is shielded from personal liability if she was not acting with malice or gross negligence, regardless of the amount of damages. CJ § 5-518(e). Second, where the employee acted without malice or gross negligence, any judgment against a county board employee acting within the scope of employment “shall be levied against the county board only and may not be executed against the county board employee.” CJ § 5-518(h) (emphasis added).

Thus, in those 4 circumstances, a judgment may “be entered against both the employee and the county board of education, but the judgment may be levied and executed against the county board of education only.” Bd. of Educ. v. Marks-Sloan, 428 Md. 1, 29 (2012). B. The Assaults. A violent altercation occurred at the Vanguard Collegiate Middle School (“VCMS”), a Baltimore City Public School, on October 28, 2014. The facts presented at trial focused on the conduct of a school police officer at VCMS, Officer Lakeisha Pulley.2 The entire encounter was recorded on school security cameras and the video was presented at trial.

During a class change, Officer Pulley verbally and physically assaulted three students, Starr Neal, Ty’llah Neal, and Diamond McCallum (the “Students”).3 In the initial encounter, a verbal altercation between Officer Pulley and Starr Neal turned physical. As Starr Neal walked by, Officer Pulley reached out for Starr Neal, grabbed her by the hair and pushed her against a window. Starr Neal struggled with Officer Pulley as Officer Pulley hit her and directed pepper spray at her face. When Ty’llah Neal approached the altercation to intervene, Officer Pulley hit Ty’llah Neal and pushed her into an exterior door.

A third student, Diamond McCallum, approached the fray and physically struck Officer Pulley in the head and neck area. Officer Pulley released her grip on Starr Neal’s 2 The Court of Special Appeals spells Officer Pulley’s first name “Lakisha.” The spelling in this opinion relies upon the spelling in the complaints below. 3 On September 25, 2015, Officer Pulley pleaded guilty to three counts of second-degree assault. 5 hair and chased Diamond McCallum down the hall. As Diamond McCallum backed away, Officer Pulley struck her three times in the head with an expandable baton. Officer Pulley then retreated and the altercation ended when Diamond McCallum withdrew into an office and a VCMS teacher physically restrained Starr Neal and Ty’llah Neal.

C. The Civil Case. The parents and guardians of the Students filed three nearly identical complaints in the Circuit Court for Baltimore City against Officer Pulley and the Board. 4 According to the Students’ complaints, there was no provocation by the Students and the entire altercation occurred for “no apparent or viable” reason. The Students brought four intentional tort claims and two constitutional claims: (1) false imprisonment; (2) malicious prosecution; (3) false arrest; (4) intentional infliction of emotional distress; (5) violation of Article 26 of the Maryland Declaration of Rights; and (6) violation of Article 24 of the Maryland Declaration of Rights. The Students also brought claims of assault and battery against Officer Pulley and a claim of negligent hiring, retention, supervision and credentialing against the Board.

Upon the Board’s motion, the circuit court dismissed with prejudice the intentional infliction of emotional distress and negligent hiring claims. 4 The Students also named as defendants the City of Baltimore, the Baltimore City Public School System, the Baltimore City School Police Force, Chief Marshall T. Goodwin of the Baltimore City School Police Force, Gregory E. Thornton, the Chief Executive Officer of Baltimore City Public Schools, and Mr. Charley Serrida, a teacher at VCMS (“Serrida” is also spelled “Surida” in various court documents). Each of those defendants was dismissed or awarded judgment in rulings that are not relevant to this appeal. 6 1. The Summary Judgment Stage After discovery, the Board filed a motion for summary judgment that relied upon, among other things, the statutory immunity provided by § 5-518. Specifically, the Board argued that (1) if Officer Pulley was acting within the scope of employment, she had immunity both as a police officer and under § 5-518(e) and, therefore, had no liability by which the Board could be held responsible; and (2) if Officer Pulley was acting outside the scope of her employment or committed an intentional tort, the Board was immune to liability under § 5-518.

The Board also argued that it completely escaped liability if there was a finding that Officer Pulley acted with malice because such malicious actions took the claims outside the Board’s potential responsibility under § 5-518. In its written motion for summary judgment, the Board cited § 5-518 numerous times for the contention that it could not be responsible for damages or indemnification. Curiously, however, the Students’ response failed to dispute the Board’s interpretation of the statute or even cite § 5-518. The Students instead argued that the Board could be held responsible under respondeat superior because (1) the Board ratified Officer Pulley’s tortious actions when it upheld the Students’ suspensions; and (2) the “custom or policy” of the Board caused the constitutional violations.

The circuit court entered orders granting the Board’s motion for summary judgment and dismissed with prejudice all the claims against the Board. The court also dismissed with prejudice several of the claims against Officer Pulley, but left pending certain intentional tort claims and the claim that she violated the Students’ rights under Article 24 of the Maryland Declaration of Rights. In coming to these conclusions, it is unclear 7 whether the court considered the implications of the Board’s indemnification status under § 5-518 because the orders did not explain the bases of the decisions. 2. The Trial The Students presented their case to a jury over the course of three days in September 2017.

As a result of its dismissal by summary judgment, the Board was not party to and did not participate in the trial. During trial, the Students dropped their intentional tort claims and proceeded only with the Article 24 claim. Counsel for Officer Pulley, “mindful of” § 5-518, requested instructions and a special verdict sheet with findings not only on the constitutional violation but also on whether such violation was the result of malicious or grossly negligent conduct. According to Officer Pulley’s counsel, a finding on malice would have determined who was liable to satisfy a possible judgment: [Officer Pulley’s Counsel]: [I]f the[ constitutional violations] were committed with malice or gross negligence, then my client, Officer Pulley, has liability.

If they were committed without malice or gross negligence then the County Board in this case, the Baltimore City Board of School Commissioners has liability. The Students objected to, and the court struck, the special instructions and special verdict sheet because malice was not an element of the claims currently before the jury. The parties did, however, stipulate that Officer Pulley was acting within the scope of her employment during the altercation. At the conclusion of trial, the jury found that Officer Pulley violated the rights of each of the students and awarded damages of $150,000 to Starr Neal, $100,000 to Diamond McCallum, and $30,000 to Ty’llah Neal.

Even after obtaining a final judgment, it is unclear whether Students’ counsel appreciated the indemnification status of 8 the Board because counsel did not, at any stage of the litigation, appeal the earlier order dismissing the Board from the case.5 3. The Motions to Enforce the Judgments Six weeks later, the Students asked the Board by email to satisfy the three judgments entered against Officer Pulley. Counsel for the Board responded in a one-line email: “[The Board] is not paying. [The Board] was out of the case and has no legal obligation to pay.” A few hours later, the Board sent another email warning Students’ counsel that the Board would seek sanctions pursuant to Maryland Rule 1-341 if the Students initiated any legal proceedings seeking any payment from the Board. The threat fell on deaf ears as the Students’ counsel filed a motion to enforce the judgment that same week.

Despite making no argument under § 5-518 during the summary judgment stage, the Students now argued that the Board was obligated to satisfy the judgments pursuant to § 5-518 because Officer Pulley committed her tortious conduct within the scope of her employment. Although the initial complaints alleged malice or gross negligence, the Students now, for the first time, contended that the tortious conduct was committed without malice or gross negligence. The Students also argued that “the statute forbids the[m] from levying the judgment against Defendant Pulley personally” based on their stipulation that Officer Pulley acted within the scope of her employment and their new concession that she acted without malice or gross negligence. 5 Nor did Students’ counsel, at any point, request that the circuit court exercise its discretion to direct entry of a partial final judgment under Maryland Rule 2-602(b). 9 At the hearing on the motion to enforce the judgments, the Students’ counsel conceded that he had made a strategic decision to proceed at trial only on the Article 24 counts to thus avoid arguing that Officer Pulley acted with malice. According to counsel, he did so “specifically with an eye towards” later establishing the Board’s responsibility to indemnify Officer Pulley under § 5-518.

Counsel interpreted § 5-518 to mean that “if a school board employee does have malice, then the schools may not have to indemnify them.” Thus, as a trial strategy, the Students’ counsel proceeded only with the Article 24 claim because, unlike the common law intentional torts, the constitutional claim did not require proof of malice. Counsel thus acknowledged that his trial strategy was “to eliminate the risk to [the Students] that [they] would receive a judgment wherein the Defendant Pulley would have committed malice . . . and then [the] school system wouldn’t have to pay because [the Students] viewed Officer Pulley as an insolvent defendant.” The Board argued, as it did in the prior emails to Students’ counsel, that it was not obligated to pay the judgments because it had been completely removed from the case: summary judgment was entered in its favor, all claims against it were dismissed with prejudice, and the Students failed to seek reconsideration or appeal that judgment. As such, the Board contended that (1) the Students’ claim was barred by res judicata and collateral estoppel; and (2) the entry of summary judgment was premised on Officer Pulley having acted with malice “and/or” gross negligence, therefore liability could not be revived against the Board due to the Students’ change in theory at trial, during which the Board was absent. In a one-page order, the circuit court rejected the Board’s position and granted the Students’ motion to enforce judgments.

The Board filed a timely notice of appeal. 10 4. The Court of Special Appeals In the Court of Special Appeals, the dispute centered on whether the grant of summary judgment in favor of the Board acted as a res judicata bar to the Students’ later- filed motion to enforce. The Students argued that res judicata did not apply because the circuit court’s entry of summary judgment applied only to their claims against the Board based on direct liability and common law respondeat superior liability. Thus, they asserted, their indemnification claim under § 5-518 is an entirely separate claim that was not at issue on summary judgment.

The Court of Special Appeals, in a well-reasoned unreported opinion, disagreed and held that the Students’ motion to enforce was barred by res judicata. Balt. City Bd. of Sch. Comm’rs v. Neal, No. 2366, Sept. Term, 2017, 2019 WL 855642 (Md. Ct. Spec.

App. Feb. 21, 2019). After parsing out in great detail the plain language requirements under § 5-518, the Court of Special Appeals discussed Board of Education v. Marks-Sloan, 428 Md. 1 (2012), in which this Court explained that the proper procedure under § 5-518 is for a “plaintiff to sue both the county board and its employee, to obtain a judgment against both, and then to satisfy the judgment against the board alone.” Neal, 2019 WL 855642 , at ⁶. Based on the requirements laid out in § 5-518 and Marks-Sloan, the Court of Special Appeals held that the Students’ claims that the Board was responsible for indemnification under § 5-518 were included in their initial complaints and that those claims were resolved by the circuit court’s awards of summary judgment in favor of the Board and dismissals with prejudice of all claims against the Board. That is based on (1) the statutory scheme, which requires joinder of the Board for the purpose of the indemnification claim; (2) the language of the Students’ complaints against the Board, which sought to hold the Board responsible for damages based on the actions of Officer Pulley; and (3) the actual arguments made on summary judgment, in which the Board sought judgment based on 11 the absence of any potential obligation under § 5-518 and the plaintiffs did not contest that claim.[6] Neal, 2019 WL 855642 , at ¹¹.

In dicta, the Court of Special Appeals addressed “malice” under § 5-518 in a comprehensive footnote. As the court noted, both parties seemingly accepted that liability of county boards and liability of county board employees are mutually exclusive. The Board’s belief therefore, that a board has no liability if its employee acted with malice or gross negligence, compelled the Board’s position on summary judgment. Similarly, the Students’ trial strategy not to argue that Officer Pulley acted with malice was based on this same interpretation of the statute.

Although the intermediate appellate court had no need to clarify the statutory language, it noted that “the parties’ interpretation is at least arguably in tension with the plain language of” § 5-518. Id. at ⁵ n.6. 6 Because the intermediate appellate court concluded on res judicata grounds, it did not address the Board’s alternative claims that the circuit court erred: (1) in entering a judgment against the Board even though it was not “joined” as a party at trial; (2) in entering a judgment against the Board even though there had been no determination binding as to the Board that Officer Pulley’s tortious acts were undertaken within the scope of her employment and without malice or gross negligence; and (3) in determining that the Board was responsible for the entire amount of the Students’ combined judgments against Officer Pulley even though its liability under § 5-518 was limited, the Board contends, to $100,000 per occurrence. Neal, 2019 WL 855642 , at ³ n.3. Those grounds are not relevant to this appeal. 12 The Students filed a petition for writ of certiorari which we granted on June 7, 2019.

Neal v. Balt. City Bd. of Sch. Comm’rs, 464 Md. 9 (2019). They presented two questions for our review, which we have consolidated and rephrased:7 In order to force a county school board to indemnify a judgment against a county board employee, does the mandatory joinder requirement under § 5- 518 of the Courts & Judicial Proceedings Article require a county board be joined as a party throughout the entire litigation?

For the reasons that follow, we answer in the affirmative. A judgment on the direct claims against a county board employee requires a plaintiff to affirmatively enforce the board’s statutory obligation to indemnify their employee against damages by including them in all stages of the litigation. Where a county board has been removed from a case, the plain language of § 5-518 requires a plaintiff to (1) request that the board be brought back into a case; or (2) at the appropriate time,8 appeal a circuit court order that otherwise dismisses a board prior to or during trial. The Students’ counsel below did not properly follow the plain language directives of § 5-518 either by requesting that the Board be brought back in after summary judgment or by appealing the circuit court’s summary 7 The exact questions presented were: 1.

Did [the Court of Special Appeals] err in holding that the trial court’s order granting a Motion to Enforce Judgments against a school board pursuant to [CJ] § 5- 518 . . . was barred by res judicata? 2. May a judgment solely against a school board employee be levied against a school board pursuant to CJ[] § 5-518? 8 Such an appeal, of course, is subject to the Final Judgment Rule. CJ § 12-301; see Monarch Acad. Balt.

Campus, Inc. v. Balt. City Bd. of Sch. Comm’rs, 457 Md. 1 , 41–42 (2017) (“[A] party may generally appeal only from ‘a final judgment entered in a civil or criminal case by a circuit court.’” (quoting CJ § 12-301)). 13 judgment ruling. Due to the Students’ § 5-518 procedural errors, the Board is not required to satisfy the judgments against Officer Pulley.

Such a statutory failure foregoes the need to apply the principles of res judicata. As such, we affirm the judgment of the Court of Special Appeals on statutory grounds. STANDARD OF REVIEW The parties agree that Officer Pulley was acting within the scope of her employment with the Board at the time of the incident. The Students no longer allege that Officer Pulley was acting with malice or gross negligence in causing the Students’