Washington Homes, Inc. v. Interstate Land Development Co.

⁷¹⁴ Orth, J., delivered the opinion of the Court. This case stems from a contract dated 23 June 1972 (the Sales Agreement) for the sale and development of several hundred single family residential lots in Charles County, Maryland. The original vendor was Interstate Land Development Company, Inc. It was succeeded by Interstate General Development, Inc. Along the way, their interests under the Sales Agreement were obtained by St. Charles Associates, a limited partnership. The vendee was Washington Homes, Inc. 1 Disputes over the performance of the Sales Agreement led to litigation in the Circuit Court for Charles County.

Interstate General Development, Inc. filed an action seeking a decree compelling Washington Homes, Inc. to perform by paying to it the purchase price of the property with interest. (Equity No. 3694). Washington Homes, Inc. countered with an action against Interstate Land Development Company, Inc. and Interstate General Development, Inc. praying that the vendors be compelled to perform under the Sales Agreement, to convey to it as many lots as the vendors were ready to deliver in accordance with the terms and conditions of the contract and to pay compensatory damages. (Equity No. 4098).

The Sales Agreement did not provide for the arbitration of disputes. On 13 February 1976, Interstate Land Development Company, Inc., Interstate General Development, Inc. and Washington Homes, Inc. executed an instrument (the Arbitration Agreement) whereby they agreed that, in lieu of the litigation pending in the Circuit Court for Charles County, they would submit to binding arbitration all of the disputes which had arisen as of that date from the terms and conditions of the Sales Agreement. By order of court issued 24 February 1976 upon stipulation, the pending actions were placed on the Stet Docket. In June 1976, the parties stipulated in writing that St. Charles Associates, which had obtained the interests ⁷¹⁵ of the original and successor vendors on 25 May 1976, would be bound under the Arbitration Agreement.

The American Arbitration Association constituted a panel of three neutral arbitrators. 2 They made an award after a full plenary hearing. 3 The heart of the award, specified in ¶6 to be “in full settlement of all claims submitted to this arbitration,” was contained in ¶1 wherein it was declared that the Sales Agreement “between the parties, which was the subject matter of this arbitration, be rescinded and declared null, void and of no force and effect.” 4 Washington was not satisfied. It filed an action in the Circuit Court for Charles County against Interstate, the American Arbitration Association, and each of the three arbitrators, in which it sought to vacate the award. The court disposed of the case by granting a motion by Interstate for summary judgment and ordering the dismissal of the Bill of Complaint. Washington appealed to the Court of Special Appeals.

On our own motion, we certified the case to us for review before decision by that court. I The ultimate question is the propriety of the trial court’s grant of Interstate’s motion for summary judgment. “In an action, a party asserting a claim ... or a party against whom a claim is asserted, may at any time make a motion for a summary judgment in his favor as to all or any ⁷¹⁶ part of the claim on the ground that there is no genuine dispute as to any material fact and that he is entitled to judgment as a matter of law.” Maryland Rule 610 a 1. The summary judgment procedure is not a substitute for a trial, but a means by which the trial court may determine, summarily, whether a trial is necessary. At the trial level, the court, in ruling on a motion for summary judgment, does not decide disputed facts, but decides whether any real dispute as to material facts exists.

Lipscomb v. Hess, 255 Md. 109, 118 , 257 A. 2d 178 (1969). “The judgment sought shall be rendered forthwith if the pleadings, depositions and admissions on file, together with the affidavits, if any, show that there is no genuine dispute as to any material fact and that the moving party is entitled to a judgment as a matter of law.” Maryland Rule 610 d 1. “Conversely, if there is a genuine dispute as to any material fact, summary judgment would not properly be granted.” Brown v. Suburban Cadillac, Inc., 260 Md. 251, 255 , 272 A. 2d 42 (1971). “[Ejven where the underlying facts are undisputed, if those facts are susceptible of more than one permissible inference, the choice between those inferences should not be made as a matter of law, but should be submitted to the trier of fact.” Fenwick Motor Co. v. Fenwick, 258 Md. 134, 138 , 265 A. 2d 256 (1970), and cases therein cited. The function of the trial judge is much the same as that which he performs at the close of all the evidence in a jury trial when motions for directed verdict or requests for peremptory instructions require him to determine whether an issue requires resolution by a jury or is to be decided by the court as a matter of law. Lynx, Inc. v. Ordnance Products, 273 Md. 1, 8 , 327 A. 2d 502 (1974); Salisbury Beauty Schools v. St. Bd., 268 Md. 32, 41 , 300 A. 2d 367 (1973). A court cannot rule summarily as a matter of law until the parties have supported their respective contentions by placing before the court facts which would be admissible in evidence.

Rooney v. Statewide Plumbing, 265 Md. 559, 563-564 , 290 A. 2d 496 (1972); Shatzer v. Kenilworth Warehouses, 261 Md. 88, 95 , 274 A. 2d 95 (1971); Brown v. Suburban Cadillac, Inc., 260 Md. at 255 . “ ‘[W]hen the moving ⁷¹⁷ party has set forth sufficient grounds for summary judgment, the party opposing the motion must show with some precision that there is a genuine dispute as to a material fact.’ ” Shatzer at 95 (quoting Brown at 255 ). “A bare allegation in a general way that there is a dispute as to material facts is never sufficient to defeat a motion for summary judgment____General allegations which do not show facts in detail and with precision are insufficient to prevent the entry of summary judgment.” Lynx, Inc. at 7-8. A material fact is one “the resolution of which will somehow affect the outcome of the case.” Rooney at 564 . How each opposing party may place before the court facts necessary to the determination of a motion for summary judgment is explained in Maryland Rule 610 and the cases applying the Rule. In Vanhook v. Merchants Mut.

Ins. Co., 22 Md. App. 22, 26-27 , 321 A. 2d 540 (1974), the Court of Special Appeals pointed out that some of the ways to place facts before the court were by affidavit, Maryland Rule 610 a 3; Davis v. Montgomery County, 267 Md. 456 , 298 A. 2d 178 (1972); by deposition, Maryland Rules 400-413; White v. Friel, 210 Md. 274 , 123 A. 2d 303 (1956); by answers to interrogatories, Maryland Rule 417; by admission of facts, Maryland Rule 421; by stipulation or concession; by pleadings, Melbourne v. Griffith, 263 Md. 486 , 283 A. 2d 363 (1971); Vanhook at 27 explained: “The function of pleadings in summary judgment cases is twofold: “1. They serve to frame the issues, with respect to which the court must determine materiality. “2. Allegations and the response, or lack of response, may establish facts as admitted or deemed to be admitted, for the purpose of the case.

See, for example, Maryland Rules 311, 326, 342 c, 372.” In reviewing the propriety of the trial court’s action on a motion for summary judgment, the appellate court is concerned with whether there was a dispute as to any material fact, and if not, whether the moving party was entitled to judgment as a matter of law. In considering the ⁷¹⁸ matter, the duly shown facts which would be admissible in evidence and all reasonable inferences deducible therefrom must be considered in a light most favorable to the party opposing the motion and against the party making the motion. See Rooney, 265 Md. at 563-564 ; Shatzer, 261 Md. at 95 ; Brown, 260 Md. at 255 . II Washington’s Bill of Complaint To Vacate Arbitration Award and Interstate’s Answer framed the issue whether, in providing in the arbitration award that the Sales Agreement “be rescinded and declared null, void and of no force and effect,” the arbitrators exceeded their powers. 5 As we have indicated, the trial court decided the issue by granting Interstate’s motion for summary judgment, and dismissing Washington’s Bill of Complaint.

The award thus stood affirmed. 6 In granting Interstate’s motion- for summary judgment the court said: “By the parties having submitted to the arbitrators all of the issues which arose from each and all of the disputes concerning the Terms and Conditions of the Agreement for the Sale and Development of Lots, they granted to the arbitrators the power to determine to what extent, if any, that Agreement was enforceable and what relief, if any, should be granted. “In determining liability under the contract the arbitrators would clearly have the power to determine if there would, in fact, be any liability. Thus, the enforceability of the contract would be a preliminary issue to be decided. Thus, the arbitrators’ award deciding that the contract was unenforceable did not exceed their powers.” ⁷¹⁹ Implicit in the grant of the motion was that the court determined summarily, as it may, that there was no genuine dispute as to a fact material to the issue. Board v. John K. Ruff, Inc., 278 Md. 580, 594 , 366 A. 2d 360 (1976).

During the hearing on the motion it was suggested that there was no issue of fact; the matter was one of interpretation of documents which was a question of law for the court. The judge agreed: “I think that if it is determined that the arbitrators had the power to reach the award that they reached in this case, then I think that decides the motion for summary judgment.” It was established by admissions in responses to allegations in Washington’s Bill of Complaint To Vacate Arbitration Award that a Sales Agreement had been executed; that actions for specific performance of the Sales Agreement had been filed by each side in the Circuit Court for Charles County and docketed as Equity Nos. 3694 and 4098; that the parties agreed to binding arbitration and to place the pending specific performance actions on the Stet Docket; that the American Arbitration Association constituted a panel of neutral arbitrators to hear in arbitration issues raised by the parties; and that the arbitrators made an award which was forwarded to the parties under date of 22 October 1976. The pleadings, by attachments as exhibits, placed before the court the Arbitration Agreement, the stipulation and order to place the two specific performance actions on the Stet Docket, and the arbitration award. The Motion for Summary Judgment placed before the court by attachments as exhibits, the two bills of complaint for specific performance, which included as an exhibit the Sales Agreement.

There was no dispute with respect to the existence or legality of these documents. With regard to the factual requisite for grant of summary judgment, we think that on the facts admitted through the pleadings and the documents placed before the court, Interstate as the moving party had set forth sufficient grounds for summary judgment, so that it was incumbent upon Washington to show in detail and with precision that there was a genuine dispute as to a material fact. To do so, Washington submitted an affidavit by Lawrence M. Breneman, its President. Breneman ⁷²⁰ made the bare allegation “that there is a genuine dispute as to material facts as such facts are set forth in [Interstate’s] Motion for Summary Judgment.” This, of course, in itself, was not sufficient to defeat the Motion.

He gave as specifics that Washington “submitted to arbitration only such Terms and Conditions as were labeled as such in [the Sales Agreement].” It is not disputed that it was certain of the terms and conditions of the Sales Agreement which were the subject of arbitration. He asserted that “such Terms and Conditions were the subject matter of specific performance litigation having been brought in the Circuit Court for Charles County, Maryland, in Equities numbered 3694 and 4098.” This was admitted. He referred to attached copies of an exchange of correspondence between counsel fór appellant and counsel for appellees, “which,” he claimed, “further give clear evidence to the fact that the June 20, 1976 meeting, the same being a meeting wherein all principals agreed to submit certain matters to binding arbitration, produced an Agreement limiting arbitration to ‘all of the presently outstanding issues.’ ” The Arbitration Agreement, executed 13 February 1976, provided inter alia: “That each and all of the disputes having arisen, as of this date, from different interpretations of the Terms and Conditions of the [Sales Agreement] be submitted to binding arbitration____” It is manifest that the correspondence is not at odds with the Arbitration Agreement. The affidavit concludes: “That at no time did I enter into any agreement or authorize any one on behalf of Washington Homes, Inc. to submit to binding arbitration matters that were not in dispute as of the date of the Agreement dated February 12, 1976, and that, furthermore, neither Washington Homes, Inc. nor Interstate Land Development Company, Inc. and/or Interstate General Development, Inc. at any time prior to February 12, 1976, alleged or averred that the heretofore mentioned June 23, 1972 Agreement was null and void.” ⁷²¹ There was no allegation by Interstate that Breneman entered into any agreement or authorized anyone on behalf of appellant to submit to binding arbitration matters that were not in dispute as of the date of the Arbitration Agreement, nor did Interstate claim, as far as the record before us discloses, that at any time prior to [13] February 1976, they alleged or averred that the Sales Agreement was null and void.

Thus, to this point in the determination of the propriety of the grant of the Motion for Summary Judgment, we find no genuine dispute as to any material fact which would bar the grant of the Motion. We turn, therefore, to the second requisite that Interstate be entitled to judgment as a matter of law. Ill The parties by written contract duly executed agreed to submit certain disputes “to binding arbitration before an Arbitration Panel to be constituted through the American Arbitration Association” and “to be bound by the terms of the award, as is to be issued, by the Arbitration Panel aforesaid.” 7 Pursuant to the agreement, the American Arbitration Association constituted a panel of neutral arbitrators at the request of the parties. The parties participated in a plenary hearing conducted by the arbitrators in the conference room of the office of the American Arbitration Association, following which the arbitrators issued an award.

The award provided that the administrative fee and expenses of the Association and the fees for the remuneration of the arbitrators, to be borne by the parties equally, “shall be paid as directed by the Association.” 8 It is manifest that by their agreement and their effectuation of the arbitration, the parties “provided for arbitration by the ⁷²² American Arbitration Association.” They thereby made the Commercial Arbitration Rules of the Association a part of their arbitration agreement. 9 Section 42 of the Rules provides: “The Arbitrator may grant any remedy or relief which he deems just and equitable and within the scope of the agreement of the parties, including, but not limited to, specific performance of a contract.” As it is implicit that the arbitrators here deemed just and equitable the relief and remedy they granted, the question is whether the relief and remedy was “within the scope of the agreement of the parties.” The introductory clauses of the Arbitration Agreement referred to the Sales Agreement, observing that it did not call for binding arbitration in the event any disputes arose therefrom, noted the pending actions for specific performance and alleged that “each party hereto has agreed that, in lieu of litigation in the Circuit Court for Charles County, Maryland, as aforesaid, that the parties enter into binding arbitration.” The parties then agreed, for good and valuable considerations specified, to submit to binding arbitration certain matters which i they designated, as we have indicated, to be “each and all of the disputes having arisen, as of this date [13 February 1976], from different interpretations of the Terms and Conditions of the [Sales Agreement]----” The Arbitration Agreement did not precisely delineate the disputes which had so arisen as of 13 February 1976. At the arbitration hearing, however, the parties made clear what disputes were within the contemplation of the Arbitration Agreement. ⁷²³ Before the trial court, by way of exhibits to Interstate’s Motion for Summary Judgment, were two documents entitled respectively “Contention of Interstate Land Development, Inc. and Interstate General Development, Inc., its Successor” and “Position of Washington Homes, Inc.” Also attached as exhibits to the Motion were transcriptions of portions of the proceedings at the arbitration hearing. The documents asserting the contentions of