Tower Oaks Boulevard, LLC v. Procida

EYLER, DEBORAH S., J. Tower Oaks Boulevard, LLC (“Tower Oaks”), the appellant, is a Virginia limited liability company that owned commercial real estate located at 2701 Tower Oaks Boulevard, in Rockville (“the Property”). 2701 Tower Oaks Boulevard Holdings, LLC (“TOB Holdings”) held a deed of trust against the Property. Brent W. Procida and Laura S. Bouyea, the appellees, were appointed by TOB Holdings as substitute trustees under the deed of trust. On October 22, 2012, in the Circuit Court for Montgomery County, the substitute trustees commenced an action against Tower Oaks to foreclose on the deed of trust for the Property. Tower Oaks filed a motion to stay and dismiss.

The court granted a temporary stay but, after an evidentiary hearing, lifted the stay and denied the motion. Tower Oaks noted this interlocutory appeal, in which it asks whether the court’s ruling was in error. We shall affirm the order. ³⁸¹ FACTS AND PROCEEDINGS On March 19, 2007, TOB, Inc., an entity related to Tower Oaks, borrowed $9.1 million dollars from CWCapital, LLC (“CW”), and executed a promissory note guaranteed by Tower Oaks. (Unless it is necessary to do otherwise, we include TOB, Inc., when we reference Tower Oaks.) As security for the loan, Tower Oaks granted CW a deed of trust against the Property.

The promissory note and the deed of trust were assigned several times to various lenders, the last of which was TOB Holdings. The sole Member of Tower Oaks is Oak Plaza, LLC (“Oak Plaza”), a Maryland limited liability company. Oak Plaza’s Operating Agreement states that its purpose is “to acquire and hold all outstanding membership interests in Tower Oaks LLC and, through Tower Oaks LLC, to buy, sell, own, hold, develop, lease, manage, subdivide, and otherwise deal in and with the ... Property and to do any and all things necessary, convenient, or incidental to that purpose.” Oak Plaza was formed on January 11, 2001.

Its original Members were five siblings in the Buckingham family, who owned the following percentages of the company: Thomas and Daniel, 26% each; and Susan, Richard, and David, 16% each. Their father, John Buckingham, was designated the Manager of the company in the Operating Agreement, but was not a Member. An amendment to the Operating Agreement in February of 2007 made John a Member, with a 1% interest. The other Members’ interests were reduced accordingly (Thomas and Daniel, 25.8% each; Susan, Richard, and David, 15.8% each).

John also was the Manager of Tower Oaks under its Operating Agreement. For many years, he managed both companies. As we shall discuss below, the Tower Oaks Operating Agreement authorizes its Manager to carry out the business of the company but requires that “Major Decisions” be made “by written instrument of Members representing a majority of Membership Interests.” Among these “Major Decisions” is any decision “to compromise, settle or submit to arbitration, ³⁸² and to institute, prosecute, and defend any and all actions in favor of or against [Tower Oaks] or relating to its businesses.” The Oak Plaza Operating Agreement, by contrast, gives the Manager extremely broad authority and discretion to act on behalf of the company and make decisions affecting it. That Operating Agreement contains a succession plan for the position of Manager.

The plan provides that John will act as Manager until his death or resignation, at which time Thomas, Daniel, and Elizabeth Buckingham (John’s wife and the mother of the siblings) “shall jointly become the Manager (with all Manager decisions to thereafter be made by majority vote of these three (3) individuals, or in such other manner as they may among themselves determine to be appropriate.).” (The Manager of Oak Plaza need not be a Member.) John developed dementia and became unable to function mentally. On January 13, 2011, the Circuit Court for Montgomery County issued an order appointing Elizabeth and David co-guardians of John’s person and David guardian of his property, without limitation. David’s guardianship authority included the power to act in John’s stead as Manager of Tower Oaks and Manager of Oak Plaza. Tower Oaks defaulted on its obligations under the promissory note, and in November of 2011, in the Circuit Court for Montgomery County, the substitute trustees, acting under the deed of trust held by TOB Holdings, commenced a foreclosure action against the Property (sometimes referred to as “the first foreclosure action”).

The Property was sold at foreclosure on November 28, 2011. On December 19, 2011, David, with the agreement of Thomas, Richard, and Susan, retained the law firm of Gleason, Flynn, Emig and Fogleman (“GFEF”) to defend Tower Oaks in the foreclosure action. Through GFEF, Tower Oaks filed exceptions to the foreclosure sale. Eventually, the substitute trustees agreed to set the sale aside and dismiss the foreclosure action without prejudice.

On July 30, 2012, the court entered a consent order to that effect. In the meantime, on December 7, 2011, Elizabeth died. ³⁸³ On August 14, 2012, David, acting as Manager of Oak Plaza and purportedly acting pursuant to a provision of the Oak Plaza Operating Agreement by which each Member makes the Manager his or her attorney-in-fact, signed a “Second Amendment to Operating Agreement of Oak Plaza, LLC” (“Second Amendment”) individually, and on behalf of Thomas and Daniel, as their attorney-in-fact. Richard and Susan personally signed the Second Amendment. As written, the Second Amendment changed the line of managerial succession in the Oak Plaza Operating Agreement, removing Thomas and Daniel and replacing them with Richard, Susan, and David.

Thomas and Daniel were not aware of the Second Amendment. John died on October 17, 2012. Five days later, on October 22, 2012, the substitute trustees again brought a foreclosure action against Tower Oaks regarding the Property (sometimes referred to as “the second foreclosure action”). A sale of the Property was scheduled for November 13, 2012.

On November 9, 2012, Tower Oaks, represented by GFEF, filed a motion to stay and dismiss the second foreclosure action, under Rule 14-211(a). Such a motion “shall ... state with particularity the factual and legal basis of each defense that the moving party has to the validity of the lien or the lien instrument or to the right of the plaintiff to foreclose in the pending action.” Id. If the court grants a temporary stay, it shall then conduct a merits hearing, after which, unless it finds good cause to the contrary, it shall grant the motion if it finds that the moving party has established that the lien or lien instrument is not valid or has established that the plaintiff did not have a right to foreclose. Md. Rule 14-211(e).

The court shall deny the motion if it finds otherwise. Id. In its motion, Tower Oaks “dispute[d] and challenge^ the] plaintiffs’ right to foreclose against the Property.” It did so based on allegations it had made in a pending civil action it had brought, together with TOB, Inc., Oak Plaza, and John (soon before his death), against TOB Holdings and prior holders of the promissory note (“the Lenders”), and Ronald ³⁸⁴ Cohen Investments, Inc., and Ronald Cohen Management Company, both tenants of the Property (“the Tenants”) (“the civil action”). In the civil action, Tower Oaks made claims for tortious interference with contractual relations, civil conspiracy, aiding and abetting, abuse of process, breach of contract, conversion, unjust enrichment, constructive fraud, and breach of an indemnification agreement.

The gist of the allegations was that the Lenders, most prominently TOB Holdings, had conspired with the Tenants to have the Tenants not pay their rent for the Property, which would deprive Tower Oaks of the income necessary to make the payments on the promissory note secured by the Property, put the loan in default, and result in foreclosure. Also on November 9, 2012, the substitute trustees filed an opposition to the motion to stay and dismiss. They stated that the total amount due on the loan, which had been accelerated upon default, was over $9.8 million. They pointed out that in the civil action Tower Oaks had acknowledged the promissory note and deed of trust, that payment on the promissory note was in default, and that the loan had been accelerated.

They emphasized that, pursuant to Rule 14-211(a)(3)(B), a motion to stay and dismiss a foreclosure action must “ ‘state with particularity the factual and legal basis of each defense that the moving party has to the validity of the lien or the lien instrument or to the right of the plaintiff to foreclose in the pending action.’ ” (Emphasis in opposition filed by substitute trustees.) They argued that Tower Oaks’s motion to stay and dismiss was legally deficient, as it did not present a defense to the validity of the lien or to the right of the lien holder to foreclose. The substitute trustees stated: The Complaint [in the civil action] seeks a money judgment, an accounting and the imposition of a constructive trust. It does not contest the validity of the lien or the right of TOB Holdings to foreclose. On the contrary, the Complaint [in the civil action] confirms the validity of the Deed of Trust and the default.

Still on that same day, the court held an expedited hearing on whether to issue a temporary stay of the upcoming foreclo ³⁸⁵ sure sale. The court granted the temporary stay, scheduled a merits hearing on the motion to stay and dismiss for January 3, 2013 (which later was moved to January 10, 2013), and ordered Tower Oaks to post a bond by 2:00 p.m. on November 13, 2012, in the amount of $95,030.52 “as security for payment of advertising fees, cancellation fees, and the December, 2012, and January, 2013 payments of principal and interest.” Instead of posting a bond, Tower Oaks paid that sum of money into court. On January 9, 2013, the day before the hearing, the substitute trustees filed a “trial brief,” in which they argued for the first time that Tower Oaks’s “appearance in th[e second foreclosure] action” was “improper” because its defense in that action had not been authorized in accordance with the Operating Agreements of Tower Oaks and Oak Plaza. The substitute trustees reasoned as follows.

Whether Tower Oaks would defend itself in the second foreclosure action was a “Major Decision” of that company that, according to its Operating Agreement, had to be made by a majority of its Members. Because Oak Plaza was the only Member in Tower Oaks, that “Major Decision” was its to make. Per Oak Plaza’s Operating Agreement, the authority to make that decision rested with its Manager, not its Members. Also per the Oak Plaza Operating Agreement, upon John’s death Thomas and Daniel became the Manager, jointly, of Oak Plaza.

Therefore, only they had the authority to decide whether Tower Oaks should defend itself in the second foreclosure action, and, if so, to take steps to do so. Thomas and Daniel had not made any decision or taken any action on that issue, however. Only David, who, not being the Manager of Oak Plaza, did not have the power to make that decision and take action on it, had done so. Accordingly, the motion to stay and dismiss, filed at David’s request, was not authorized by Tower Oaks and had to be denied.

The substitute trustees also argued, as they had at the hearing on the temporary stay, that Tower Oaks could not show that the lien or lien instrument were invalid or that TOB Holdings did not have the right to foreclose on the Property. ³⁸⁶ The hearing went forward on January 10, 2013, and largely was devoted to the issue of David’s authority vel non to cause Tower Oaks to defend itself in the second foreclosure action. The substitute trustees argued, as explained above, that because Thomas and Daniel did not authorize the hiring of counsel or the filing of the motion to stay and dismiss, the court had no option but to deny the motion. Mr. Fogleman (of GFEF), arguing on behalf of Tower Oaks, offered three reasons why David had been authorized to decide whether Tower Oaks would defend itself in the second foreclosure action and to take action to launch a defense: 1) David’s guardianship power to act as Manager of Oak Plaza in John’s place extended beyond the time of John’s death, at least for a short period that encompassed the decision to defend Tower Oaks in the second foreclosure action (filed on October 22, 2012, five days after John died); 2) when GFEF was retained to represent Tower Oaks in the first foreclosure action, before John’s death, the scope of the retention was to defend Tower Oaks in all foreclosure actions brought against it regarding the Property, which ultimately included the second foreclosure action; and 3) the Second Amendment to Oak Plaza’s Operating Agreement removed Thomas and Daniel from the line of managerial succession and replaced them with David, Susan, and Richard, who in fact authorized the defense of Tower Oaks in the second foreclosure action. The substitute trustees called Thomas and Daniel as witnesses.

Thomas testified that he had served as the Assistant Manager of Tower Oaks until around the time David was appointed guardian of John’s property. He did not sign the Second Amendment to the Oak Plaza Operating Agreement. He had consented to and authorized GFEF’s representing and defending Tower Oaks in the first foreclosure action, in November 2011, and had discussed the matter with Mr. Fogle-man then and in March of 2012. No one had discussed the second (pending) foreclosure action with him.

When asked by the court whether he was authorizing David to proceed to take steps to defend Tower Oaks in the second foreclosure action, including hiring counsel, Thomas said he would “give [his] ³⁸⁷ permission” to David to “do this.” Thomas further testified that he had assumed that the second foreclosure action was a “continuation” and “followup” to the first foreclosure action, involving the same Property and the same loan. It was his view at the time of the hearing (January 10, 2013), as it had been in the Fall of 2011, that it was a “good idea” for Tower Oaks to contest the foreclosure action. Daniel testified that he had had no involvement in any matter having to do with the Property since 2009. He was not aware of the first foreclosure action and sale (later vacated) in 2011, and had not been informed of any decisions made or actions taken by David, or by anyone, regarding Tower Oaks’s defense to that foreclosure action or to the second (pending) foreclosure action.

He did not sign the Second Amendment to the Oak Plaza Operating Agreement, regarding the succession plan. As of the present (January 10, 2013), he did not have sufficient information to say whether he would have authorized Tower Oaks’s defense in the second (pending) foreclosure action had he been asked. Mr. Fogleman read into the record the engagement letter of December 19, 2011, between GFEF and Tower Oaks. The letter was signed by David.

(We shall discuss its contents infra.) David then was called as a witness. He testified, in pertinent part, that in the Fall of 2011, when he was acting as guardian of John’s property and therefore Manager of Oak Plaza and Tower Oaks, he had engaged GFEF to defend Tower Oaks in the first foreclosure action, which was then pending, and in any future foreclosure action concerning the Property. David further testified that Daniel had not communicated any inclination against defending Tower Oaks in the second foreclosure action or against retaining GFEF to represent Tower Oaks in that action. David stated that, when it came time to decide how to defend Tower Oaks in the second foreclosure action, he consulted with Mr. Fogleman and executed the affidavit attached to the motion to stay and dismiss.

He had been aware in August of 2012 (before John’s death) ³⁸⁸ that the substitute trustees were planning to file a second foreclosure action against the Property. Mr. Procida, one of the substitute trustees, had told him then that a foreclosure sale of the Property likely would be scheduled for a date in September of 2012. According to David, that was when he decided in favor of defending Tower Oaks in the second foreclosure action, even though it had not yet been filed, and he made that decision by exercising his authority as Manager of Oak Plaza, in John’s stead. The court ruled from the bench.

It determined that, under Md.Code (2001, 2011 Repl.Vol.), sections 13-220 and 13-221 of the Estates and Trusts Article, David’s guardianship of John’s property ceased upon John’s death, and after that date David had no power to act as Manager of Oak Plaza. It further determined that the engagement letter did not change this, and did not authorize a defense of Tower Oaks in an action commenced after John’s death. The court also found that the Second Amendment to Oak Plaza’s Operating Agreement, purporting to change the managerial succession plan for that company, did not come “close to complying with the law” because the Operating Agreement required an amendment of that significance to be made by the Members of Oak Plaza personally, not by means of a power of attorney. Because Thomas and Daniel did not give their consent to amend the Operating Agreement to change the line of managerial succession, no change was effected.

Upon John’s death, they became the Manager of Oak Plaza, jointly (Elizabeth having already died). Although it had ruled that the motion to stay and dismiss had to be denied because it was not authorized by Tower Oaks, the court discussed the substance of the motion, and whether the facts alleged in the civil action, if true, could establish that TOB Holdings, and through it the substitute trustees, did not have the right to foreclose on the Property. The judge observed: [T]he defendant in the foreclosure action has a preexisting duty to pay that money, and if there was some reason that it was deprived of its funds, it seems to me that an action for ³⁸⁹ damages might lie — I don’t suggest that it does or doesn’t— but that would be the appropriate remedy for someone who says, “I couldn’t pay because basically you took my money away.” And I recognize this is an equitable action and the unclean hands doctrine applies. I’m still reluctant to conclude that the relief that a person of, whose property was being foreclosed would have would be to say, you know, “You’ve caused this,” because I don’t think the language of [Rule] 14-211(a)(3)(B) refers to that.

I think it rather refers to the legal right of the plaintiff to foreclose, and whether he was not the proper note-holder or there was some imperfection in the deed ..., I think that’s what that refers to. The judge further commented: “I don’t really think, even assuming that [Tower Oaks] put on its case here and I said, ‘You know what, the reason you didn’t pay this was because they deprived you of your ability to do so,’ I don’t think that falls within the provisions of the rule. I don’t think that’s what is contemplated by the rule.” That same day, the court issued and docketed an order lifting the temporary stay that had been entered on November 9, 2012. On January 22, 2013, Tower Oaks filed a motion to alter, amend, or revise judgment, and request for hearing, which was denied by order entered on January 25, 2013.

On February 6, 2013, Tower Oaks filed a notice of appeal. On February 21, 2013, the court issued and docketed an order denying the motion to stay and to dismiss “[f]or the reasons stated in the court’s opinion delivered from the bench on January 10, 2013.” On February 28, 2013, Tower Oaks filed a second notice of appeal. In the meantime, on February 12, 2013, the substitute trustees filed in the circuit court a motion to dismiss appeal, to which Tower Oaks filed an opposition. On April 11, 2013, the court issued an order, entered on April 16, 2013, denying the ³⁹⁰ motion. 1 During the pendency of this appeal, the second foreclosure action against the Property has proceeded in the circuit court, with Tower Oaks defending the action, through GFEF.

On February 8, 2013, the Property was sold. TOB Holdings “bought in” at a purchase price of $6 million. The substitute trustees filed a report of sale on March 11, 2013. On May 28, 2013, Tower Oaks filed exceptions.

The exceptions were denied and on September 4, 2013, the court issued an order ratifying the sale. Tower Oaks filed a notice of appeal from that order. That appeal is pending in this Court. Also during the pendency of this appeal, the claims in the civil action were decided in part before trial by the court and in part by a jury and the court at trial.

The court granted summary judgment in favor of the Lenders on the claims against them. The claims against the Tenants were tried to a jury, which found in favor of Tower Oaks and awarded it significant compensatory damages, including sums for lost rent. After an evidentiary hearing, the court awarded Tower Oaks punitive damages against the Tenants. Recently, the Tenants noted an appeal in this Court.

We shall include additional facts as necessary to our discussion of the issues. DISCUSSION I. Motions to Dismiss for Mootness In their brief, the substitute trustees argue that this appeal must be dismissed as moot because the court denied the motion to stay and dismiss on two grounds, and in its brief ³⁹¹ Tower Oaks only challenges one ground, making no mention of the other. Specifically, the substitute trustees maintain that the court denied the motion because it was filed without authorization and because Tower Oaks did not present legally sufficient evidence to support a finding that TOB Holdings did not have a right to foreclose. Yet, Tower Oaks only has challenged the authority ruling on appeal.

In a reply brief, Tower Oaks argues that the court denied the motion to stay and dismiss on the ground that it was filed without authorization, and that the court’s observations about the unclean hands doctrine and the type of evidence necessary to show that the lien holder does not have a right to foreclose were not a separate, independent ground for its ruling. Thus, the only ruling subject to challenge on appeal was the one determining that Tower Oaks’s defense, including its motion to stay and dismiss, had not been authorized and therefore was of no effect. Tower Oaks also argues that, if the court ruled on two separate, independent grounds, both rulings were in error. After briefs were filed but before oral argument in this Court, the substitute trustees filed another motion to dismiss the appeal, also for mootness, but on a different theory.

As we have explained, Tower Oaks had argued that the court should grant the motion to stay and dismiss because, under the unclean hands doctrine, TOB Holdings had lost its right to foreclose by engaging in wrongful conduct that resulted in Tower Oaks’s defaulting on the promissory note. Almost a year after the motion to stay and dismiss was denied, the court in the civil action granted summary judgment in favor of the Lenders, including TOB Holdings. The substitute trustees argue that because the claim of wrongful conduct against TOB Holdings in the civil action was essential to Tower Oaks’s assertion that TOB Holdings did not have a right to foreclose, TOB Holdings’ victory in the civil action eliminated Tower Oaks’s “no right to foreclose” argument. Therefore, Tower Oaks was left with no basis on which to challenge TOB Holdings’ right to foreclose, and, even if authorized to file the motion to stay and dismiss, had no basis for it. ³⁹² Maryland law makes clear that “[a] case is moot when there is no longer an existing controversy between the parties at the time it is before the court so that the court cannot provide an effective remedy.” Coburn v. Coburn, 342 Md. 244, 250 , 674 A.2d 951 (1996).

With this definition in mind, we shall deny the motions to dismiss this appeal on both theories. There is no theory advanced by the substitute trustees that would warrant dismissal of this appeal for mootness. Their arguments, if viable, would warrant an affirmance of the court’s order. The law of appellate review establishes that, “ ‘[w]hen a separate and independent ground that supports a judgment is not challenged on appeal, the appellate court must affirm.’ ” Bailiff v. Woolman, 169 Md.App. 646, 653 , 906 A.2d 409 (2006) (quoting San Antonio Press, Inc. v. Custom Bilt Machinery, 852 S.W.2d 64, 65 (Tex.Ct.App.1993)).

Here, if Tower Oaks failed to challenge both grounds on which the court denied the motion to stay, and the grounds were separate and independent, we would have no choice but to affirm the order denying the motion to stay and dismiss on the ground not challenged. That is not the situation here, however, because the two grounds were not separate and independent. The court denied the motion on the ground that Tower Oaks had not been authorized to take action to defend itself in the second foreclosure action, making the motion to stay and dismiss ineffective. The court then went on to address the merits of the motion to stay and dismiss, opining that if the motion to stay and dismiss had been authorized, the wrongful conduct by TOB Holdings that resulted in the Tenants not paying rent and Tower Oaks not having funds to pay the note would not eliminate TOB Holdings’ right to foreclose, as a matter of law or under the unclean hands doctrine.

The court’s “ruling” about the merits of the motion to stay and dismiss was not a separate and independent basis on which it denied the motion. At most, it was a contingent ruling. The court found that Tower Oaks filed an unauthorized and therefore ineffective motion to stay and dismiss; the consequence of that finding is that any “ruling” on the merits ³⁹³ of the motion is immaterial. It is not a separate basis for denying the motion, independent of the lack of authority ruling.

If this Court were to decide on appeal that the circuit court was correct in its lack of authority ruling, that would result in an affirmance, with the “ruling” on the merits remaining inconsequential. Even if this Court were to decide on appeal that the circuit court had erred in its lack of authority ruling, the “ruling” on the merits only would take on meaning with respect to whether the error was prejudicial. In that case, the “ruling” on the merits, if itself correct, would enable this Court to conclude that the motion to stay and dismiss would have to have been denied, even absent the authority ruling. In neither situation are the two rulings separate and independent and in neither situation has there ceased to be a live controversy between the parties so that the case has become moot.

Regardless of the court’s “ruling” on the merits of the motion to stay and dismiss, and regardless of the resolution of the claims against TOB Holdings in the civil action in its favor, there is a controversy between the parties over whether the court erred in finding that Tower Oaks lacked authority to defend itself in the second foreclosure action, and this Court has the power to provide an effective remedy respecting that controversy. It is worth noting that the lack of authority ruling has affected subsequent rulings in the second foreclosure action. For example, the court denied Tower Oaks’s exceptions to the foreclosure sale and ratified the sale on the ground that the lack of authority ruling made in January 2013 continued to apply for the life of the case, and therefore Tower Oaks had no authority to file exceptions to the sale. As mentioned, these later rulings now are being challenged on appeal.

The decision in this appeal about authority vel non could affect the outcome of that appeal. For all these reasons, this case is not moot, and this appeal will not be dismissed for mootness. 2 ³⁹⁴ II. Denial of Motion to Stay and Dismiss for Lack of Authority The parties repeat many of the arguments they advanced below about whether Tower Oaks’s defense in the second foreclosure action, including its filing of the motion to stay and dismiss, was or was not authorized. In particular, Tower Oaks maintains that David had authority to decide that Tower Oaks would defend itself and to take action to accomplish that purpose because: 1) he retained guardianship power after John’s death to act as Oak Plaza’s Manager for a brief period, during which the decision whether Tower Oaks would defend against the second foreclosure action was made; 2) before John’s death, David effectively “pre-authorized” GFEF to defend Tower Oaks against all future foreclosure actions involving the Property; or 3) by virtue of the Second Amendment to the Oak Plaza Operating Agreement, upon John’s death, David, Richard, and Susan became the Manager, jointly, of Oak Plaza, and therefore had authority to decide whether Tower Oaks would defend itself in the second foreclosure action.

(David, Susan, and Richard all agreed that Tower Oaks should defend itself). Tower Oaks also argues that Thomas and Daniel ratified David’s decision to defend Tower Oaks in the second foreclosure action and to have GFEF represent Tower Oaks in that action (as it had done in the first foreclosure action). The substitute trustees respond that the court correctly rejected these arguments, and that other arguments, such as ratification, have no factual basis. Therefore, under the managerial line of succession provision in the Oak Plaza Operating Agreement, Thomas and Daniel were the Manager of Oak Plaza, which was the sole Member of Tower Oaks when the second foreclosure action was initiated, and they had sole authority to decide for Oak Plaza, and hence for Tower Oaks, ³⁹⁵ whether to defend Tower Oaks in that action.

David’s actions in that regard were unauthorized. The circuit court’s decision on the authority issue was based in part upon its interpretation of the Operating Agreements for Tower Oaks and Oak Plaza, and relevant statutory law. These are legal decisions that we review de novo. See Moscarillo v. Prof'l Risk Mgmt.

Servs., Inc., 169 Md.App. 137, 145 , 899 A.2d 956 (2006). We also review mixed questions of law and fact by a circuit court de novo. See Winder v. State, 362 Md. 275, 310-11 , 765 A.2d 97 (2001). Finally, we defer to the court’s factual findings, unless they are clearly erroneous, but give no deference to its purely legal conclusions.

Fischbach v. Fischbach, 187 Md.App. 61, 88 , 975 A.2d 333 (2009). It is important to keep in mind that the authority issue in this case is not about an ultra vires act of a business entity. An act of a corporation is ultra vires if it is beyond the scope of the express or implied powers conferred upon the corporation by statute or by its charter, articles of incorporation, or by-laws. 19 C.J.S. Corporations § 673, (2007); Day v. Nu-Day Partnership, LLLP, 289 Ga. 357 , 711 S.E.2d 689, 690-91 (2011); Rowe v. Franklin County, 318 N.C. 344 , 349 S.E.2d 65, 68-69