Smith v. State Farm Mutual Automobile Insurance

MOYLAN, J. The appellant, Terrence Smith, sued the appellee, State Farm Mutual Automobile Insurance Company, in the Circuit Court for Baltimore City for the breach of an insurance contract. On June 21, 2005, Judge Kaye Allison granted State Farm’s motion, pursuant to Maryland Rule 2-327(c), to transfer the case to the Circuit Court for Montgomery County. On this appeal, Smith contends 1. that Judge Allison abused her discretion in ordering the transfer of the case, and 2. that Judge Allison erroneously denied him a hearing on the transfer. On March 30, 2002, Smith was a passenger in a car being driven by Ashley Anne Ray that was headed southbound on New Hampshire Avenue in Montgomery County.

Ray lost control of the vehicle. The vehicle collided with a guardrail and then, after it crossed the center line, struck an oncoming vehicle driven by Adam Carl Krause. Smith sustained bodily injuries in the collision. Ashley Ray was insured by the Maryland Automobile Insurance Fund (MAIF) for the liability insurance policy limits of $20,000/$40,000 in coverage.

MAIF offered Smith the policy limits of $20,000, and he accepted the offer. State Farm enabled the settlement by waiving its potential right of subrogation against Ashley Ray. Smith then sued State Farm for underinsured motorist benefits predicated on the alleged liability of Ashley Ray. The suit was brought on an automobile insurance policy maintained by Smith’s father, also named Terrence Smith, with whom Smith resided in Montgomery County.

State Farm has denied liability and has raised the affirmative defenses of both contributory negligence and the assumption of risk. It has also denied Smith’s entitlement to unin ²⁹⁰ sured or underinsured motorist benefits under the facts of the case and under applicable law. On May 19, 2005, State Farm filed a Motion to Transfer Action to the Circuit Court for Montgomery County. On June 21, Judge Allison, upon consideration of State Farm’s motion and Smith’s “opposition thereto,” ordered the case transferred “on the authority of Stidham v. Morris, 161 Md.App. 562 , 870 A.2d 1285 (2005).” The transfer of the action was pursuant to Maryland Rule 2-327(c), which provides: (c) Convenience of the parties and witnesses.

On motion of any party, the court may transfer any action to any other circuit court where the action might have been brought if the transfer is for the convenience of the parties and witnesses and serves the interests of justice. The Case For the Transfer Those paragraphs of State Farm’s motion that help to make out a case for the transfer from Baltimore City to Montgomery County are as follows: 1. Neither Baltimore City nor its citizens has any connection to or interest in this dispute. The accident occurred in Montgomery County, Maryland; the parties and witnesses reside in Montgomery County (with one exception); the insured vehicle was garaged in Montgomery County and insurance was obtained in Montgomery County, Maryland.

No events relevant to either the liability or damages issues occurred in Baltimore City where the case is pending. 2. The subject accident occurred on New Hampshire Avenue near its intersection -with Cliftonbrook Lane in Montgomery County. 3. According to the Complaint, as well as the Motor Vehicle Accident Report, the Plaintiff himself resides in Montgomery County, Maryland and was so residing there when the accident occurred. Plaintiff resided with his father, Terrence Smith, and this claim for underinsurance motorist benefits derives from the Plaintiffs status as a ²⁹¹ “resident relative ” with his father who resided in Montgomery County. 4.

Altogether, there were four people who were witnesses or potential witnesses to the subject accident: Plaintiff Terrence Smith (passenger in Ray vehicle); Ashley Ann Ray (driver of Ray vehicle); Adam Krause (driver of second vehicle); and Richard Reed (witness). According to the Motor Vehicle Accident Report (Exhibit 1 hereto), Ms. Ray lived on Washington Boulevard in Elkridge, Maryland, a town that is located in Howard County. Besides Ms. Ray, the other three witnesses to the collision all resided in Montgomery County. In addition to the Plaintiff, Adam Krause lived on Armand Lane in Silver Spring, and an eyewitness, Richard Reed, lived on Tamworth Lane in Silver Spring.

Thus, all eyewitnesses, or potential eyewitnesses, reside in Montgomery County except Ms. Ray who resides in Howard County not Baltimore City. 5. After the incident, the Plaintiff was transported by ambulance to Suburban Hospital which is located in Bethesda, Montgomery County, Maryland. Plaintiff received all of his medical care in Montgomery County, to the best of undersigned’s knowledge. For example, attached hereto collectively as Exhibit 2 are copies of the first pages of the medical reports generated from each healthcare provider who treated the Plaintiff.

It appears from these records that all medical care was administered in Montgomery County. That is, according to records produced to this Defendant in connection with the claim, Plaintiff received medical care from Suburban Hospital (Bethesda), Montgomery General Hospital (Olney), Phillips and Green, M.D. (Silver Spring), Don Fonatana, M.D. (Chevy Chase), and H. Ryan Kazemi, M.D.

(Bethesda). All of these providers are in Montgomery County, Maryland. 6. In short, besides the fact that the accident itself occurred in Montgomery County, virtually all of the potential liability and damages witnesses are located in Montgomery County. And to the extent that there could be (although it is unlikely) contractual issues relevant to this ²⁹² case, the Plaintiff is claiming underinsured motorist benefits under a policy issued to Plaintiffs’ parents, Terrence O. Smith and Janet Mr. Smith, who reside in Olney, Montgomery County, Maryland.

The vehicle insured was a 1989 Toyota Camry which was presumably kept or garaged at the insureds’ residence in Montgomery County, Maryland. (Emphasis supplied). The Case Against the Transfer Those paragraphs of Smith’s Opposition to the Motion to Transfer that set out reasons for not transferring the case to Montgomery County are as follows: 5. That pursuant to Ann.Code Cts. & Jud.

Art. § 6-201, a Defendant may be sued in a county where “the defendant resides, carries on a regular business, is employed, or habitually engages in a vocation”. Without question, State Farm regularly carries on business in the City of Baltimore. Consequently, venue is proper in this Honorable Court. 8. As discussed in Leung, supra, the Plaintiff has made a tactical decision in his choice of venue and this choice should not be disturbed unless the moving party can strongly show reasons to support its position.

See also Simmons v. Urquhart, 101 Md.App. 85 , 643 A.2d 487 (1994). 9. Plaintiff plans at trial to call Dr. Edward R. Cohen, 2506 St. Paul Street, Baltimore, Maryland as his expert witness. Dr. Cohen is located in the City of Baltimore and it is more convenient for him to appear at trial conducted in the Circuit Court for Baltimore City than in Rockville, Maryland. 10. In its Motion, the Defendant alleges that it would be convenient for Ashley Ray to appear in Rockville as opposed to Baltimore.

According to the police report, submitted by the Defendant as an attachment, Ms. Ray resides at 7734 Washington Boulevard, Elkridge, Maryland. Upon checking with Mapquest, it is discovered that Ms. Ray’s address ²⁹³ is 14.27 miles from the Circuit Court for Baltimore City while this same address is 31.22 miles from the Circuit Court for Montgomery County: more than double the distance. Clearly, the location of this Honorable Court is more convenient to Ms. Ray than that of Montgomery County. (Emphasis supplied).

Immediate Appealability Although the denial of a motion to transfer a case on the ground of forum non conveniens would be only interlocutory and would not be immediately appealable, the affirmative order of a transfer is subject to immediate appellate review. In Brewster v. Woodhaven Building and Development, Inc., 360 Md. 602, 615-16 , 759 A.2d 738 (2000), Judge Raker explained. [A]n order putting an appellant out of a particular court is also a final judgment. It follows that an order transferring a case from one circuit court to another, for proper venue or for a more convenient forum, and thereby terminating the litigation in the transferring court, is a final judgment and thus immediately appealable. At the same time, an order denying a motion to transfer is not an immediately appealable final judgment, because the litigation may continue in the court issuing the order.

(Emphasis supplied). See also Cobrand v. Adventist Healthcare, Inc., 149 Md.App. 431, 437-38 , 816 A.2d 117 (2003) (“Because appellants challenge the grant of appellee’s motion [to transfer], this case is properly before us on appeal.”). Transfer on the Basis of Forum Non Conveniens Chief Judge Wilner explained for this Court in Lennox v. Mull, 89 Md.App. 555, 562-63 , 598 A.2d 847 (1991), that the transfer of a case from one county to another on the basis of forum non conveniens, in contrast to a transfer based on actual lack of venue, can be traced to the promulgation of Maryland Rule 2-327(c) in 1984. He further explained that the then new rule was derived from a Federal statute—28 U.S.C. § 1404(a). ²⁹⁴ This would seem to be confirmed by the Court’s felt need in 198b to add to that provision (now codified as Md. Rule 2-327(b)) Rule 2-327(c), specifically allowing a transfer for the convenience of parties and witnesses.

Md. Rule 2-327(a) was derived from, a Federal statute— 28 U.S.C. § lbOb(a). See Source Note to Rule 2-327. Section 1404(a) provides that “[f]or the convenience of parties and witnesses, in the interest of justice, a district court may transfer any civil action to any other district or division where it might have been brought.” (Emphasis supplied). In Odenton Development Co. v. Lamy, 320 Md. 33, 40 , 575 A.2d 1235 (1990), Judge Chasanow, after noting the provenance of Rule 2-327(c), pointed out how the federal cases interpreting 28 U.S.C. 1404(a) are highly persuasive authority in Maryland.

Section (c) of Md. Rule 2-327 was derived from 28 U.S.C. § 1404 (a). Consequently the federal law construing § lb0b(a) is highly persuasive in our analysis of the trial court’s ruling, which was based on Md. Rule 2-327(c). (Emphasis supplied). In enunciating, for the first time, the basic guidelines for appellate review of a transfer decision, Judge Chasanow supported each principle with a wealth of supporting caselaw both from the Supreme Court and from lower federal courts.

When determining whether a transfer of the action for the convenience of the parties and witnesses is in the interest of justice, a court is vested with wide discretion. Norwood v. Kirkpatrick, 349 U.S. 29, 32 , 75 S.Ct. 544, 546 , 99 L.Ed. 789, 793 (1955); King v. Johnson Wax Associates, Inc., 565 F.Supp. 711, 719 (D.Md.1983). Section 1404(a) is intended to place discretion in the District Court to adjudicate motions for transfer according to an ‘individualized, case-by-case consideration of convenience and fairness.’ Stewart Organization, Inc. v. Ricoh Corp., 487 U.S. 22, 29 , 108 S.Ct. 2239, 2244 , 101 L.Ed.2d 22, 31 (1988) (citing Van ²⁹⁵ Dusen v. Barrack, 376 U.S. 612, 622 , 84 S.Ct. 805, 812 , 11 L.Ed.2d 945, 953 (1964)). It is the moving party who has the burden of proving that the interests of justice would be best served by transferring the action, Texas Gulf Sulphur Company v. Ritter, 371 F.2d 145 , 147 (10th Cir.1967); Equitable Bank v. Finn, 671 F.Supp. 374, 380 (D.Md.1987); King, 565 F.Supp. at 719 , and a motion to transfer should be granted only when the balance weighs strongly in favor of the moving party.

Akers v. Norfolk and Western Railway Company, 378 F.2d 78, 80 (4th Cir.1967); King at 719 . To reach this decision, a court “must weigh in the balance the convenience of the witnesses and those public-interest factors of systemic integrity and fairness that, in addition to private concerns, come under the heading of ‘the interest of justice.’ ” Stewart, 487 U.S. at 30 , 108 S.Ct. at 2244 , 101 L.Ed.2d at 32 . 320 Md. at 40 , 575 A.2d 1235 . The Standard of Appellate Review In Wagner v. Wagner, 109 Md.App. 1, 52 , 674 A.2d 1 , cert. denied, 343 Md. 334 , 681 A.2d 69 (1996), Judge Cathell, writing for this Court, sounded the basic theme of appellate deference to the discretionary decision of the trial judge on whether to transfer an action. The trial court enjoys wide discretion in determining whether to transfer an action on the grounds of forum non conveniens, and the reviewing court should be reluctant to substitute its judgment for that of the trial court.

(Emphasis supplied). In Cobrand v. Adventist, 149 Md.App. at 437 , 816 A.2d 117 , Judge Sharer stressed the deference that an appellate court extends to the discretionary decisions of a trial judge. We review a trial court’s decision to transfer a case to another venue, pursuant to Md. Rule 2-327(c), under an abuse of discretion standard. “When determining whether a transfer of the action for the convenience of the parties and witnesses is in the