Rustic Ridge, L.L.C. v. Washington Homes, Inc.

MARVIN H. SMITH, Judge, Retired, Specially Assigned. This appeal involves a dispute between two developers as to which one is entitled to a nearly 90-acre parcel of land in Prince George’s County. Washington Homes, Inc. (“Washington Homes”) filed suit against Rustic Ridge, L.L.C. (“Rustic Ridge”) and its managing member, John Dixon, in the Circuit Court for Prince George’s County.

The first count of the complaint sought a declaratory judgment that Washington Homes was “the proper and rightful owner” of the land. The second count sought compensatory and punitive damages against Rustic Ridge and Dixon for slander of title. Washington Homes moved for partial summary judgment on the declaratory judgment count, and the court granted the motion over Rustic Ridge’s objection. The court declared that Washington Homes was “the proper and rightful owner.” Rustic Ridge then filed this appeal.

It argues, in essence, that: I. The trial court erred by ruling on the motion for partial summary judgment despite Rustic Ridge’s request that it be permitted to complete discovery first, II. The trial court erred by granting partial summary judgment in that the record disclosed genuine disputes as to material facts, and ⁹² III. The trial court erred by denying Rustic Ridge’s motion to reconsider and vacate the partial summary judgment. For the reasons that follow, we conclude that Rustic Ridge’s appeal is from an unappealable interlocutory order.

Therefore, we shall dismiss the appeal. 1 FACTS The land in question was owned collectively by 13 individuals to whom we shall refer herein as “the sellers.” On July 14, 2000, the sellers entered into an “Agreement of Sale” with Rustic Ridge. The agreement indicated that the land consisted of 147 lots for single-family homes, and that Rustic Ridge was to pay the sellers $19,500.00 for each lot. The agreement specified that the sellers had given a right of first refusal to Washington Homes. The agreement stated: Seller hereby notifies Buyer that after Buyer executes this Agreement to purchase the Property, Seller is required to offer the Property to a third-party entity, for a period of .fifteen (15) days after Seller’s receipt of the signed Agreement, which has a first right of refusal to purchase the Property upon the same terms and conditions set forth herein (the “Refusal Right”).

In the event the third-party entity having the Refusal Right does not notify Seller that it will execute a contract of sale upon the same terms and conditions within the aforesaid fifteen (15) day period, Seller shall notify Buyer, in writing, of the failure of the third-party entity to exercise the Refusal Right and simultaneously deliver to Buyer an original of this Agreement, fully executed by Buyer and Seller, at which time this Agreement shall become in full force and effect. The date upon which ⁹³ Buyer receives Seller’s notification that the Refusal Right has been waived and/or terminated, as well as a fully-executed original of this Agreement shall be referred to herein as the “Effective Date.” In the event that Washington Homes did not exercise its right of first refusal, the agreement provided: “Within forty-eight (48) hours after the Effective Date ..., Buyer shall pay to Home Title Company, Inc. (“Escrow Agent”) the sum of Fifty Thousand Dollars ($50,000.00) as a first deposit (“First Deposit”).” Also upon the “Effective Date,” Rustic Ridge would have a 60 day “study period,” during which it could “determine! ], in its sole discretion, that the development of the Property for the Intended Use is practical....” Within the 60-day period, Rustic Ridge could either (1) determine that the plan was impractical, terminate the agreement, and obtain the return of its deposit from the escrow agent, or (2) determine that the plan was practical and make a second $50,000.00 deposit. The agreement called for Rustic Ridge to execute a promissory note for the remaining amount at a later date. It appears from the record that Rustic Ridge received notification from the sellers on September 1, 2000, that Washington Homes had not exercised its right of first refusal.

On November 1, 2000, John Dixon, on behalf of Rustic Ridge, sent a letter to Washington Homes. In the letter, Dixon referred to several perceived problems that had arisen which might affect “consummating the closing on the project.” As a result of the perceived problems, Dixon proposed several revisions to the agreement. Dixon closed the letter by stating: The Study Period is scheduled to expire today. In the event that we are not able to agree to a mutually acceptable resolution to the above-referenced matters, this letter will serve as the Buyer’s notice that it is terminating the Agreement. ...

The record does not reflect whether the sellers agreed to Dixon’s proposed revisions. Nor does it reflect whether Rustic Ridge sought the return of its first deposit from the escrow ⁹⁴ agent. There is no dispute, however, that Rustic Ridge never made the second deposit contemplated by the agreement. On December 12, 2000, Rustic Ridge sent to the sellers an “Agreement of Sale Addendum,” signed by Dixon, which altered various terms of the original agreement.

The addendum seemingly acknowledged the continued existence of Washington Homes’ right of first refusal. It stated: It is understood and agreed that Washington Homes, Inc. has a right of first refusal to purchase the Property under the same conditions as outlined in the Agreement and this Addendum. Seller shall notify Buyer within seven (7) days of Seller’s receipt of this executed addendum from Buyer if Washington Homes, Inc. has exercised its right to purchase the Property. If Washington Homes, Inc. exercises its right to purchase the Property, the Agreement shall become null and void and the Deposit shall be returned to Buyer.

The sellers did not sign the proposed addendum. On December 18, 2000, Washington Homes notified the sellers of the following by letter: This is to advise you that Washington Homes, Inc .... is hereby exercising its right of first refusal for the above-referenced property. Please prepare an agreement that mirrors the existing agreement between the Sellers and Rustic Ridge, LLC but which incorporates ... name changes, notice changes, and other [agreed upon] changes.... That same day, Washington Homes forwarded to the sellers a check for $100,000.00, representing the first two required deposits.

A closing was held February 15, 2001, at which time title to the land was transferred from the sellers to Washington Homes. Also on February 15, Rustic Ridge filed a lis pen-dens action against the sellers, alleging that it had a valid contract to purchase the property and seeking specific performance of the alleged contract. 2 ⁹⁵ On April 26, 2001, as a result of Rustic Ridge’s suit against the sellers, Washington Homes filed the complaint against Rustic Ridge that is the source of this appeal. DISCUSSION Ordinarily, “a party may appeal [only] from a final judgment entered in a civil or criminal case by a circuit court.” Md.Code (1974, 2002 Repl.Vol.), § 12-301 of the Cts. & Jud. Proc.

Art. Rustic Ridge does not contend that the partial summary judgment against it was a final judgment. Rather, Rustic Ridge takes the position that the partial summary judgment was an appealable interlocutory order that fell within an exception to the final judgment rule. In support of its position, Rustic Ridge directs this Court to § 12-303(1) and (3)(v) of the Courts Article: A party may appeal from any of the following interlocutory orders entered by a circuit court in a civil case: (1) An order entered with regard to the possession of property with which the action is concerned or with reference to the receipt or charging of the income, interest, or dividends therefrom, or the refusal to modify, dissolve, or discharge such an order. (3) An order: (v) For the sale, conveyance, or delivery of real or personal property or the payment of money, or the refusal to rescind or discharge such an order, unless the delivery or payment is directed to be made to a receiver appointed by the court. ⁹⁶ Code (1974, 2002 Repl.Vol.), § 12-303(1) and (3)(v) of the Cts. & Jud.

Proc. Art. We readily dispose of Rustic Ridge’s contention that the appeal may be brought pursuant to § 12-303(3)(v) of the Courts Article. In granting partial summary judgment in favor of Washington Homes and thus declaring Washington Homes to be “the proper and rightful owner” of the land in question, the court did not order the “sale, conveyance, or delivery of real or personal property or the payment of money....” Id. Nor did the court refuse “to rescind or discharge such an order,” as no such order had ever been made.

Id. The land was sold and title was transferred to Washington Homes long before the court issued its ruling. Nor do we find merit in Rustic Ridge’s contention that the appeal is authorized by § 12-303(1) of the Courts Article, which concerns “possession of property” or “the receipt or charging of the income, interest, or dividends” from the property. Id.

Clearly, the trial court’s ruling did not involve income, interest, or dividends from the property. The ruling did not purport to address possession, moreover.