author: Moore, J.,

text:
    LAWRENCE N. BRANDT, INC. et al. v. MONTGOMERY COUNTY COMMISSION ON LANDLORD-TENANT AFFAIRS et al.
    [No. 830,
    September Term, 1977.]

      Decided March 13, 1978.

      The cause was argued before Gilbert, C. J., and Thompson and Moore, JJ.

      William J. Chen for appellants.

      Daniel J. Cassidy, Assistant County Attorney for Montgomery County, with whom were RichardS. McKernon, County Attorney, and Richard K Frederick, Deputy County Attorney, on the brief, for appellees Montgomery County, Maryland and Montgomery County Commission on Landlord-Tenant Affairs. A. Howard Metro for other appellees.

       Note: Certiorari denied, Court of Appeals of Maryland, May 19, 1978.

   Moore, J.,

delivered the opinion of the Court.

This appeal is another episode in the life — now legislatively extinguished — of the Montgomery County rent control law. Here, a landlord was rejected in its bid for an “Extraordinary Rent Increase.” A subsequent statutory appeal to the circuit court was unavailing, as were a request for a hearing en banc and a motion to revise judgment. The landlord then sought a rehearing before the administrative agency which the latter denied. Unbowed, the landlord then pursued an action in the circuit court for a declaratory judgment, and was again rebuffed. From the lower court’s adverse declaration, this appeal has been taken; but a like fate awaits this persistent litigant’s latest encounter.

I

On July 29,1974, appellant, Lawrence N. Brandt, Inc., filed an application for an extraordinary rent increase (ERI) with the office of Landlord-Tenant Affairs for Montgomery County (OLTA) in conformance with § 29-51 (b) of the Montgomery County Code (1972, 1974 Cum. Supp.). The ERI was sought under the county’s rent control law as a result of alleged increased operating expenses at Colesville Towers, an apartment-hotel complex in Silver Spring; the expenses were claimed to be of such magnitude as to create a “hardship” if the landlord was limited to a “basic rent increase” (BRI), up to a maximum of four per cent of the base rent for each apartment, permitted to be charged to holdover tenants under new leases.

The executive director of OLTA was empowered to rule, in the first instance, upon ERI applications and, after a hearing in which appellant and certain tenants participated, he issued a decision on January 6, 1975 granting appellant’s request.

Appeals were taken by both tenants and landlord to the Commission on Landlord-Tenant Affairs, pursuant to § 29-51 (b) (10), and a hearing was held on March 17, 1975. The executive director’s determination of the landlord’s entitlement to the ERI was reversed by the Commission. In a written “Decision and Order,” dated May 20, 1975, the Commission’s Chairman, John L. Catalan, stated, in pertinent part:

“In deciding this appeal the Commission finds that it must agree with the tenants’ contention that the record established during these proceedings fails to disclose any creditable evidence to support the landlord’s allegation of hardship.
“Section 29-51b permits the granting of an Extraordinary Rent Increase only upon a showing that the basic rent increase would result in a ‘hardship.’ Section 29-51b (5) requires the Executive Director to make a specific finding as to hardship. The landlord has the burden of proving the existence of hardship by a preponderance of the evidence.
“The record doesn’t contain any evidence to support the conclusion that the landlord has even sustained any loss in his business during the period under review, much less hardship.”

The Commission’s order constituted final administrative action under § 29-51 (b) (12), and the sole remaining remedy for an “aggrieved party” under the provisions of the Code then existing was an appeal to the Circuit Court for Montgomery County, under Subtitle B of the Maryland Rules of Procedure, entitled “Administrative Agencies — Appeal From.”

Appellant did not petition the Commission for a rehearing but filed in the circuit court, on June 10, 1975, a Petition in Support of Appeal. Appellant’s allegations were two-fold: paragraph seven, which contained eight sub-parts, challenged the constitutionality of the rent control article of the Montgomery County Code as violating due process and equal protection, impairing freedom of contract, and improperly extending the police power; the succeeding paragraph, in six sub-parts, claimed arbitrary and capricious action on the part of the Commission in substituting its judgment for that of the executive director. The relief requested was that the court declare the act unconstitutional and that it reinstate the ERI granted by the director, effective September 1, 1974, rather than October 1, 1974. (No claim of error was made in the failure of the Commission to grant a basic rent increase, as distinguished from an extraordinary rent increase.)

A hearing was held in the circuit court before Judge Richard B. Latham and, on July 15,1976, the court rendered an oral opinion. After reviewing the history of the case and the evidence presented, Judge Latham stated:

“Considering the various data as presented by the tenants at the hearing before the full Commission plus the record of the hearing before the Executive Director, the Court can only conclude that there was in fact a factual basis for the Commission finding that the record established during their hearing, and also referring to the proceedings before the Executive Director, that the landlord had in fact failed to disclose any credible evidence to support the allegation of hardship.” (Emphasis added.)

The court further held that “the findings of the full Commission [were] fairly debatable,” and refused to “substitute its own judgment for that of the Commission....” The challenges to the constitutionality of the act were not addressed in the court’s opinion.

A motion to revise the judgment, pursuant to Maryland Rule 625, was then filed by appellant in the circuit court. At a hearing before Judge Latham, appellant’s counsel argued (a) that some members of the Commission had arrived at their decision without reviewing the entire record of the proceedings before the executive director, (b) that certain new evidence of increased expenses forwarded by appellant to the Commission after the hearing had not been considered, and (c) that the Commission had applied an incorrect evaluative standard in determining whether appellant had suffered financial hardship. On February 22, 1977, Judge Latham denied appellant’s motion for revision, after hearing extensive oral argument from counsel for the parties.

Thereupon, on March 7, 1977, almost two years after the final order of the Commission from which the appeal had been taken, appellant engaged new counsel and filed a Petition for Rehearing before the Commission alleging “fraud, mistake, or inadvertence” in the Commission’s original decision of May 20,1975. Four grounds were asserted, the first three of which had been presented to the circuit court in the appeal proceedings: that the Commission applied an incorrect evaluative standard in denying the ERI; that the appellant was prejudiced by virtue of its being denied the opportunity to present evidence at the Commission hearing, and that the panel of Commissioners failed to discharge its duty to review the entire proceedings, where one or more, members failed to read the record in its entirety. The fourth ground was that the Commission failed to consider appellant’s entitlement to a “Basic Rent Increase” (BRI), when it ruled unfavorably with respect to the ERI. On March 22,1977, the Commission, agreeing “that it may have the authority under certain circumstances to rehear such a case,” declined to do so by a 4 to 3 vote.

At that juncture, appellant instituted a declaratory judgment action in the Circuit Court for Montgomery County which has given rise to this appeal. The bill of complaint also included a prayer for injunctive relief. Appellee demurred to appellant’s complaint, alleging that the action was barred by collateral estoppel or res judicata as a consequence of the prior appeal to the circuit court. At a hearing before Judge David L. Cahoon, on May 19,1977, oral motions for summary judgment were made by appellees. Judge Cahoon, holding that the court could properly enter summary declaratory judgment, delivered an oral opinion from the bench in which he carefully considered the grounds upon which appellant contended that error had been committed by the Commission. In sustaining appellees’ demurrers without leave to amend and issuing a declaratory judgment, he stated in part:

“In summary, I find in the first instance that taken in their best light, the grounds for rehearing presented to the Commission were insufficient in not meeting the test of a decision that had been caused by fraud, mistake or irregularity. More significantly, each and every one of the matters, insofar as the proceedings before this Court are concerned would be barred by res judicata, or collateral estoppel----
“For those reasons, the Court will sustain the demurrers that have been filed and will sustain them without leave to amend and issue a declaratory judgment that the Commission’s action of March 22, 1977 was not an abuse of administrative discretion in that the Commission’s hearing and action on the ERI request of Lawrence N. Brandt, Inc. was not shown to have been attended by mistake, fraud, or inadvertence____”

The court also denied the injunctive relief prayed by appellant to enjoin OLTA, the Commission, other county officials and certain tenant intervenors from interfering with appellant's right to collect the ERI rent, pending appeal procedures, under the provision of § 29-51 (b) (13) of the rent control law. See Riger v. L & B Limited Partnership, supra, note 2. Appellant thereafter filed a petition for reconsideration of Judge Cahoon’s final order. That petition was also denied.

On this appeal, it is contended that the lower court erred in disposing of the suit under a summary judgment procedure; that the declaratory judgment issued by the court was incorrectly based upon res judicata or collateral estoppel; and that injunctive relief was improperly withheld. For reasons hereafter set forth, we do not reach the first and third issues, and we approach the res judicata question in a different context.

We find in appellant’s brief a succinct statement of the purposes for which the declaratory judgment action was brought:

“The declaratory judgment action sought judicial review of two administrative actions of the local regulatory agency. The first administrative action of which complaint was made was a decision of the local agency which dealt with a request by the Appellant to raise rents at a rental facility in Montgomery County. The second administrative action of which complaint was made was a decision of the local agency which dealt with a petition filed with it by the Appellant to rehear the request to raise rents at the rental facility. The agency had denied the request to raise rents, and denied a petition to rehear the request.”

In our judgment, appellant was not entitled to further judicial réview of agency action in either of the above instances. We therefore hold that the instant appeal must be dismissed and the case remanded to the circuit court with instructions that the action also be dismissed at that level.

II

Our review of the authorities yields two grounds which require disposition of the case in this manner. First, dismissal is mandated by the clear language of the Uniform Declaratory Judgments Act, Md. Cts. & Jud. Proc. Code Ann. §§ 3-401 etseq. (1974), which provides, in § 3-409 (b) that “[i]f a statute provides a special form of remedy for a specific type of case, that statutory remedy shall be followed in lieu of a proceeding under this subtitle.” Second, we are persuaded that the doctrine of res judicata bars the declaratory judgment action with respect to the agency’s denial of appellant’s request to raise rents, and that the agency’s refusal to reconsider such determination was justified not only by res judicata considerations but also because appellant's claim to agency reconsideration came too late. We will separately discuss the application of the declaratory judgment statute and of the doctrine of res judicata to each administrative action of which “judicial review” was sought.

A. DENIAL OF REQUEST TO RAISE RENTS

1. Declaratory Judgments Act

We regard the right of appeal to the circuit court permitted an aggrieved party under § 29-51 (b) (12) of the Montgomery County Code as the precise “special form of remedy for a specific type of case” contemplated as being exclusive by the drafters of the Uniform Declaratory Judgments Act. Once the statutory mode of appeal has been exhausted, no further right remains in a party to secure review of a final decision of an agency. See Prince George’s County v. Fahey, 28 Md. App. 312, 345 A. 2d 102 (1975). There is nothing to distinguish the instant case from the legion of cases decided by the Court of Appeals where a declaratory remedy was held not to exist in the face of a statutorily-provided right of appeal. Hartman v. Prince George’s County, 264 Md. 320, 286 A. 2d 88 (1972) [citing Reiling v. Comptroller, 201 Md. 384, 94 A. 2d 261 (1953); Tanner v. McKeldin, 202 Md. 569, 97 A. 2d 449 (1953); Albert v. Public Service Commission, 209 Md. 27, 120 A. 2d 346 (1956); Quinan v. Schneider, 247 Md. 310, 231 A. 2d 37 (1967) ; Lee v. Secretary of State, 251 Md. 134, 246 A. 2d 562 (1968)]; Friendship Heights v. Funger, 265 Md. 339, 289 A. 2d 329 (1972); Soley v. State Commission on Human Relations, 277 Md. 521, 356 A. 2d 254 (1976); C. & P. Telephone Co. v. Pincoffs, 23 Md. App. 474, 328 A. 2d 78 (1974).

In a leading case involving the right to declaratory relief in such a situation, Mayor of Baltimore v. Seabolt, 210 Md. 199, 123 A. 2d 207 (1956), the city of Baltimore and intervening property owners appealed from a declaratory decree of the lower court that a zoning ordinance was invalid with respect to certain property. The Court of Appeals held that an existing statutory method of appeal from zoning board determinations created an exclusive remedy, and should have been followed by the appellants:

“If resort to declaratory judgment procedures can be had in every case where an applicant is dissatisfied with the ruling of the Board and the application of the general Zoning Ordinance to specific properties all over the City can be challenged, a condition of chaos can easily result____ “... The use of the Declaratory Judgments Act to accomplish such a result as that just stated would, we think, frustrate the purposes of the zoning laws and would go beyond the proper limits of declaratory relief.” 210 Md. at 209-10, 123 A. 2d at 212. See also Commissioners of Cambridge v. Eastern Shore Public Service Co., 192 Md. 333, 64 A. 2d 151 (1949).

Even where questions of constitutional law are involved, if they cán be raised in the statutorily-provided appellate setting, no exception to the strict rule of the Declaratory Judgments Act will apply. As the Court of Appeals stated in Poe v. Mayor of Baltimore, 241 Md. 303, 307, 216 A. 2d 707, 709 (1966), another zoning case:

“The appellants contend that they had no effective remedy before the Board, because the Board is an administrative agency, not a court, and only a court can decide a question of constitutional law. This argument overlooks the fact that Section 40 of the Zoning Ordinance provides for an appeal from the Board’s action in denying an application for a special exception to the Baltimore City Court, and, from the decision of that court, to this tribunal.” Cf. Commissioners of Cambridge v. Eastern Shore Public Service Co., supra, 192 Md. at 337, 64 A. 2d at 152-53.

In the instant case, appellant contends that errors of law were committed by the agency in denying the request for an ERI. We believe that such issues could have been, and, indeed, were presented in the circuit court in the statutory appeal from the agency’s determination. The court considered such arguments in ruling on the motion to revise the judgment and we cannot find that appellant was entitled to resort to a declaratory remedy to obtain further review of the same questions. Appellant’s remedies were at an end after the ruling of the circuit court; the existence of the special statutory remedy precluded the action now before us.

2. Res Judicata

“ ‘The doctrine of res judicata is that a judgment between the same parties and their privies is a final bar to any other suit upon the same cause of action, and is conclusive, not only as to all matters that could have been decided in the original suit, but as to all matters which with propriety could have been litigated in the first suit, where the court had jurisdiction, proceedings were regular, and [the] omission was due to [a party’s] own negligence.’ ” Lease-A-Car, Inc. v. Thomassen Lincoln Mercury, Inc., 36 Md. App. 437, 442, 373 A. 2d 1268, 1272 (1977) [quoting Frontier Van Lines v. Maryland Bank & Trust Co., 274 Md. 621, 623, 336 A. 2d 778, 780 (1975); Alvey v. Alvey, 225 Md. 386, 390, 171 A. 2d 92, 94 (1961)].

We have before us a case where res judicata applies not to the determinations of an administrative agency — a somewhat controversial area, see Board of County Commissioners v. Racine, 24 Md. App. 435, 332 A. 2d 306 (1975) — but, rather, to the decision of the circuit court in a statutorily-provided appeal under the Maryland Rules of Procedure. The declaratory judgment action brought by appellant was clearly barred by the doctrine.

The decision of the Court of Appeals in Fertitta v. Brown, 252 Md. 594, 251 A. 2d 212 (1969) is particularly instructive here. A review of the facts in some detail is necessary to show its pertinence, and points out an analogous series of procedural steps designed to obtain a measure of review beyond that permitted by Maryland law. The zoning commissioner of Baltimore County, after a hearing brought about by protesting neighbors (appellees), found that appellant, Fertitta, was illegally conducting a marina on his riverfront lot, and ordered the cessation of such activity. A further hearing determined that a non-conforming right to use the lot for a marina had been lost, and that the property could not be used for commercial purposes or as a storage place for boats belonging to appellant’s personal friends.

The board of appeals then ruled that the first order was “final,” and affirmed the second order. An appeal by Fertitta to the circuit court was dismissed for technical reasons. Appellant then succeeded in obtaining another hearing before the deputy zoning commissioner, who held that the property could be used for the rental of slips and sale of marina supplies. Appellees then appealed to the board of appeals, and the board authorized the continued operation of the marina. On appeal to the circuit court, Judge Proctor found that the prior decisions of the zoning authority, affirmed by the board of appeals, were binding and that new evidence presented at the later date should have been produced at the earlier hearings; a motion for rehearing and reconsideration by the court was denied. Appellant failed to perfect a subsequent appeal to the Court of Appeals, which was dismissed.

Thereupon, a bill seeking declaratory relief was filed by appellant in the circuit court, alleging that the original orders of the zoning commissioner were confusing and ambiguous, and resulted in an unconstitutional deprivation of property. Appellees demurred to the bill, under principles of res judicata, and Judge Menchine, then an associate judge of the circuit court, recently retired from this Court, sustained the demurrers without leave to amend.

The Court of Appeals affirmed the trial court’s order, stating:

“Whether or not the reasons relied on by Judge Proctor to deny Fertitta relief from the orders of 1962 and 1963 were sound — and we do not intimate that they were not — it is apparent that the doctrine of res judicata controls the case. The Circuit Court’s final judgment on the merits is a binding adjudication that on the same state of fact and law Fertitta does not have a right, legal or constitutional, to operate a marina or to carry on marina-type activity.... Alvey v. Alvey, 225 Md. 386; Woodlawn Area Citizens Assn. v. Board of County Commissioners for Prince George’s County, 241 Md. 187, 195-196; Chatham Corp. v. Beltram, 243 Md. 138; Alvey v. Hedin, 243 Md. 334; De Maio v. Lumbermens Mutual Casualty Co., 247 Md. 30; Pat Perusse Realty v. Lingo, 249 Md. 33.
“Declaratory relief was inappropriate here for reasons in addition to the impact of res judicata. Once a controversy has been finally adjudicated by a court with jurisdiction of the subject matter and the parties, the controversy is no longer alive and therefore is not the proper subject for a declaratory judgment action; and it is generally held that judgments and decrees speak for themselves and declaratory proceedings are not available either to construe, clarify or modify them. Declaratory proceedings were not intended to and should not serve as a substitute for appellate review or as a belated appeal. 22 Am. Jur. 2d Declaratory Judgments § 17; 2 Anderson, Declaratory Judgments (2d Ed.) § 469; Borchard, Declaratory Judgments (2d Ed.), pp. 350-352, 355---- If declaratory relief cannot be invoked prospectively where special administrative or judicial mechanics have been legislatively or judicially established for the type of case involved, certainly it should not be allowed where the special mechanics already have been utilized to binding finality.” 252 Md. at 599-600, 251 A. 2d at 214-15. (Emphasis added.)

We find Fertitta strikingly apposite. Appellant had every opportunity to complain of the errors of law alleged to have been committed by the Commission in the statutorily-provided appeal to the circuit court, and, indeed, those issues were argued in the hearing on the motion to revise judgment. Judge Latham patiently listened to extensive arguments from all parties, and the record is clear, from a series of exchanges between the court and counsel, that due consideration was given to all the issues before the motion was denied. Appellant was entitled to no further review of these questions, and the declaratory judgment action should have been dismissed.

B. RECONSIDERATION

A threshold question with respect to this issue is whether the Commission on Landlord-Tenant Affairs would have had jurisdiction to grant a rehearing had it ruled favorably on appellant’s long-delayed Petition to Rehear. It seems elementary that a motion for rehearing would have timely effect only if filed while the administrative body retained jurisdiction over the parties and subject matter of the dispute. Henry v. Department of Labor, 293 A. 2d 578 (Del. Super. 1972). A logical answer to the question of when an agency loses jurisdiction is found in 73 C.J.S. Administrative Bodies and Procedure § 156, where it is stated:

“Under statute, the power of an agency to reconsider a decision, order, or requirement may be limited to the time thereafter allowed for an appeal; and without reference to statute, it has been held that the power of an administrative agency to rehear and reconsider must be exercised within a reasonable time, and before an appeal from its original order has been lodged in the courts.” (Emphasis added.)

This principle has been given effect in several jurisdictions. In State ex rel. Borsuk v. City of Cleveland, 277 N.E.2d 419 (Ohio 1972), the court stated the rule with reference to a prior Ohio case:

“In Diltz v. Crouch (1962), 173 Ohio St. 367, 182 N.E.2d 315, an issue was presented to this court as to the authority of the Board of Liquor Control to modify an order of revocation after an appeal had been taken to court and the order affirmed. In holding that the board lacked such authority, it was reasoned that, absent specific statutory authority or rule, official boards or administrative agencies have jurisdiction to reconsider decisions only until the actual institution of a court appeal therefrom or until expiration of the time for appeal." 277 N.E.2d at 421.

Similarly, the court in Mills v. Laris Painting Co., 125 So. 2d 745, 748 (Fla. 1960), stated:

“It is ... generally recognized that the power to rehear or reconsider must be exercised before an appeal from the original order of the administrative body has been lodged or before such order has become final by lapse of time without a timely appeal.” See also Southwestern Bell Telephone Co. v. State, 71 P. 2d 747 (Okla. 1937); Dayley v. United States, 169 Ct. Cl. 305 (1965).

We view such a rule as eminently sound, and see no reason why it should not apply to preclude reconsideration by the agency in the instant case. The bill for declaratory relief would then have been ineffective, and dismissal would have been mandated.

Even apart from the rationale of the well-considered opinions in the above cases, we do not think the Commission had any authority to reconsider its decision, and appellant had no declaratory remedy to obtain such review. Our reasons parallel those previously given in Section A of Part II of this opinion.

1. Declaratory Judgments Act

We have already discussed, in some detail, the reasons why declaratory relief was inappropriate here. The language of Md. Cts. & Jud. Proc. Code Ann. § 3-409 (b) (1974) is equally applicable to the issue of agency reconsideration. Although the rent control article of the Montgomery County Code (1972, 1974 Cum. Supp.) makes no provision for a rehearing before the Commission, appellant argues that, under Board of Zoning Appeals v. McKinney, 174 Md. 551, 564, 199 A. 540, 546 (1938), a rehearing may be obtained “to correct errors in [agency] decisions caused by fraud, surprise, mistake or inadvertence____” We do not quarrel with this statement in general terms. However, it has not the slightest application to the instant case, where the request for reconsideration came after the special statutory appeal route had been taken. Any request for reconsideration should have preceded the appeal to the circuit court, and, if denied by the agency, could have been raised in the appeal. It is our view that the special remedy afforded by the statute included any possible review of the agency’s refusal to reconsider. This remedy not having been utilized, appellant was barred from seeking a declaratory judgment on the same issue. Hartman v. Prince George’s County, supra; Soley v. State Commission on Human Relations, supra.

2. Res Judicata

The applicability of the doctrine of res judicata to agency action upon reconsideration of matters which have already been appealed to the courts is well-established in Maryland. A general statement of the rule is found in Woodlawn Area Citizens Assoc, v. Board of County Commissioners, 241 Md. 187, 195, 216 A. 2d 149, 154 (1966):

“Whatever view may be taken of the applicability of the principles of the doctrine of res judicata to administrative or quasi-judicial determinations or actions of an agency, the text writers and the courts are in general agreement that the judgment or order of a court, including a trial court, which affirms or reverses such determinations or actions, ordinarily is [res judicata]. 2 Davis, [Administrative Law\ § 18.11, pp. 623-24; 2 Am. Jur. 2d Administrative Law§ 499.”

A factually apposite case is Garrett Park v. Montgomery County Council, 257 Md. 250, 262 A. 2d 568 (1970). There, one Willcher purchased a tract of land in Garrett Park; shortly afterwards, the entire town was rezoned from R-60 (Residential, 6000 square feet minimum) to R-90 (Residential, 9000 square feet minimum). Willcher then sought a change in classification from R-90 to R-T (Town Houses), and the town and its residents opposed his petition. Reclassification was granted by the County Council, and, in appeals to the circuit court and then to the Court of Appeals, the Council's decision was affirmed. See Stephens v. Montgomery County Council, 248 Md. 256, 235 A. 2d 701 (1967). Some three weeks after the Court of Appeals decision, the town filed a petition to reclassify from R-T to R-90, alleging that the prior decision of the Council had been based on an erroneous premise, i.e., that the property could not reasonably have been used while zoned R-90. The hearing examiner, Rita C. Davidson, now a member of this Court, found that the petition was barred by res judicata, since the same facts were presented in the second action as could have been shown in the first. The Council adopted this rationale, similarly finding no change in circumstances sufficient to justify reclassification. Further appeals to the circuit court and Court of Appeals followed. In an opinion by Judge McWilliams, the Court of Appeals refused to accept the town’s argument that res judicata should not apply where the initial agency decision was based on erroneous testimony and mistake. The court noted:

“No useful purpose will be served by rehashing the cases dealing with the doctrine of res judicata, especially in view of our frequent application of it in the past. Its applicability to a judgment affirming or reversing an administrative or quasi-judicial decision appears to be well settled. See, e.g., Fertitta v. Brown, 252 Md. 594, 599 (1969), and the cases cited therein.” 257 Md. at 256, 262 A. 2d at 571.

With respect to the town’s “mistake” allegation, the court further stated: “[T]he argument that a legislative body has the right to correct its own mistakes might, in another context, be persuasive; here it must yield to the dispositive effect of the doctrine of res judicata.” Id. at 257-58, 262 A. 2d at 572. See also Chatham Corp. v. Beltram, 243 Md. 138, 152, 220 A. 2d 589, 597 (1966). (“We think it plain that the first judicial decision was res judicata and prevented the second action of the Commissioners----”)

Unlike the case of Board of County Commissioners v. Racine, supra, we are here concerned with the effect of res judicata, arising from a decision of the circuit court, on an attempt to secure reconsideration by the agency. Clearly, appellant cannot obtain another “bite at the apple” in this manner.

Appeal dismissed; remanded to Circuit Court with instructions to dismiss declaratory judgment action; appellants to pay the costs.

      . This legislation, entitled “Fair Landlord-Tenant Relations,” was enacted on June 13,1972 as Bill 19-71, Chapter 93A of the Montgomery County Code, and provided comprehensive regulation of apartment rentals and landlord-tenant relationships in Montgomery County. Its structure was described and approved by the Court of Appeals in County Council v. Investors Funding, 270 Md. 403, 312 A. 2d 225 (1973). The law was repealed in its entirety and re-enacted by the County Council with amendments in Bill 35-77 as the “Omnibus Tenant Protection Act” on December 16, 1977, effective January 1, 1978. In place of the repealed rent control law, the new legislation established a system of “voluntary rent guidelines.”

      . The rent increase provisions of the law were carefully explained by Judge Eldridge in Riger v. L & B Limited Partnership, 278 Md. 281, 363 A. 2d 481 (1976) where a challenge by tenants on constitutional (“procedural due process”) grounds proved unsuccessful. It was there pointed out that the law applied to landlords owning three or more dwelling units and generally limited rent increases for holdover tenants under new leases to a maximum of 4% of the “base rent” as defined in the statute. However, the law also provided for “extraordinary” rent increases when the basic rent increase would result in a hardship to the landlord. The court characterized as “somewhat unusual” a requirement of the rent increase procedure that a tenant must pay the requested extraordinary rent increase as soon as it was scheduled to go into effect and throughout all administrative and judicial appeals, even when earlier administrative decisions were in the tenant’s favor. 278 Md. at 286, 363 A. 2d at 484. In addition, the law made no provision for the payment of interest to the tenant if the increase was eventually determined to be unwarranted. Id.

      Here, the ERI requested was in a range from 2.9% to 14.9% or $10.00 to $29.00 per unit. Appellant has collected this increase during the pendency of these proceedings, since October 1, 1974. In some cases tenants refused to pay and appellant requested below injunctive relief to permit it to continue “to charge, receive and collect” rents with the ERI included.

      . The landlord challenged only the effective date of the increase, i.e., October 1, 1974, rather than September 1, 1974.

      . No “basic rent increase” was approved by the Commission, apparently because only an “extraordinary rent increase” had been requested.

      . By subsequent amendment, appeals were permitted beyond the circuit court to the appellate courts. Montgomery County Code, § 29-57 (h) (1976 Cum. Supp.)

      . The rent control law contained no specific provision for rehearing or reconsideration by the Commission.

      . The power of the County Council to enact this legislation was affirmed in County Council v. Investors Funding Corp., supra, note 1, where the constitutionality of a number of its provisions was also upheld. A landlord challenge to the local law on so-called “substantive due process” grounds was rejected in Westchester West No. 2 Limited Partnership v. Montgomery County, 276 Md. 448, 348 A. 2d 856 (1975). That decision appears to have put to rest the constitutional questions presented to Judge Latham.

      . Judge Cahoon sua aponte raised the issue of the propriety vel non of the use of a demurrer in an action for declaratory relief and invited appellees’ motions for summary judgment. See Hunt v. Montgomery County, 248 Md. 403, 237 A. 2d 35 (1968); see also Fertitta v. Brown, 252 Md. 594, 251 A. 2d 212 (1969); Urbana Civic Assoc. v. Frederick County Board of County Commissioners, 23 Md. App. 49, 325 A. 2d 755 (1974).

      . The final order entered by Judge Cahoon noted the “absence of a fenuine dispute as to any material fact” but (1) ordered that the demurrers e sustained without leave to amend and (2) declared that the Commission’s action on March 22,1977 rejecting appellant’s petition for a rehearing “was not an abuse of administrative discretion.”


source: Caselaw Access Project

author: Mason, J.,

license: Public Domain

text:
    GENE WILSON COLLINS, KENNETH DEAN JONES and BRUNO HUNTER v. STATE OF MARYLAND
    [No. 437,
    September Term, 1977.]

      Decided April 12, 1978.

      The cause was argued before Thompson, Mason and Couch, JJ.

      Irwin Brown, Assigned Public Defender, for appellants.

      Gilbert H. Robinette, Assistant Attorney General, with whom were Francis B. Burch, Attorney General, Richard D. Warren, State’s Attorney for Wicomico County, and Robert A. Eaton, Assistant State’s Attorney for Wicomico County, on the brief, for appellee.
   Mason, J.,

delivered the opinion of the Court.

Gene Wilson Collins, Kenneth Dean Jones and Bruno Hunter, appellants, were jointly tried and convicted at a bench trial in the Circuit Court for Wicomico County of armed robbery. The testimony adduced at trial, partially through five eye-witnesses, established that on December 27, 1976, Appellants Jones and Hunter, one of whom was armed with a pistol, entered and robbed Banks Convenience Store. Appellant Collins, prior to the robbery, had “cased” the store and during the actual holdup was outside acting as a lookout.

On appeal appellants contend:

I. That the State did not establish that the warrantless search of their residences was freely and voluntarily consented to by persons authorized to do so.

II. That the trial court erred in admitting certain hearsay statements.

I.

According to the evidence, the police conducted a warrantless search of each appellant’s residence and each search produced incriminating evidence that was either introduced or testified to at trial. A police officer testified that Appellant Collins’s stepfather and mother consented to the search of their home; that Appellant Hunter’s stepfather consented to the search of his home; and that Appellant Jones’s girlfriend consented to the search of her apartment.

Appellants contend that the State failed to prove that these consents were freely and voluntarily given, and that the persons consenting had the authority to do so. Specifically, appellants argue that the police officer’s testimony regarding the consents was hearsay; and thus, “effectively prevented appellants from scrutinizing the totality of circumstances underlying the consent to search their residences.”

Appellants Collins and Hunter did not object to the police testimony concerning the consents to search, nor did they object to the legality of the searches. Accordingly, this question as to Appellants Collins and Hunter was not properly preserved for appellate review. Maryland Rule 1085.

Appellant Jones did object to the search, however, on the grounds that the State had not adequately shown that his girlfriend had the authority to consent. The police officer testified that he went to the apartment where he knew Jones was living. Jones was present at the apartment along with Ms. Ambrosia Dennis, who stated that the apartment was hers. She was advised of her right to refuse to consent to a search and was told the reason the police wished to search the apartment. Ms. Dennis signed a consent form allowing the police to search her apartment. This search yielded a pistol, that was identified as being similar to the one used by the holdup men, and some money hidden in a baby’s shoe. Ms. Dennis did not testify at trial, and Appellant Jones did not contradict the officer’s testimony as to Ms. Dennis’s assertion that it was her apartment.

Appellant Jones concedes that a girlfriend, in the status of a co-tenant, may consent to a search. Streat v. State, 11 Md. App. 543, 547 (1971). Nevertheless, he contends that the officer’s hearsay testimony was inadmissible to establish her authority to consent to the search. It is clear that the officer’s testimony on this matter was hearsay; however, the formal rules of evidence do not govern the evidence that can be used in resolving preliminary fact questions concerning the admissibility of evidence. United States v. Matlock, 415 U. S. 164 (1974); United States v. De La Fuenta, 548 F. 2d 528, 532-33 (5th Cir. 1977); Duncan and Smith v. State, 27 Md. App. 302, 305 (1975), rev’d on other grounds, 276 Md. 715 (1976).

In Matlock, a warrantless search of the defendant’s bedroom was conducted. At the suppression hearing, the government sought to prove that consent to search had been given by a woman who lived in the same house as the defendant. The preliminary fact question to be determined was whether the woman and the defendant exercised sufficient joint control over the bedroom as to make her consent valid. The trial court refused to consider the woman’s statements to the searching officer that she and the defendant both occupied the bedroom and slept together there. Although recognizing that the statement was hearsay, the Supreme Court nevertheless held that the trial judge should have received and considered it in determining whether the woman’s consent was valid, and stated:

There is, therefore, much to be said for the proposition that in proceedings where the judge himself is considering the admissibility of evidence, the exclusionary rules, aside from rules of privilege, should not be applicable; and the judge should receive the evidence and give it such weight as his judgment and experience counsel. (Emphasis supplied).

415 U. S. at 175.

Therefore, in the present case, the police officer’s testimony as to Ms. Dennis’s authority to consent to the search was admissible on the preliminary issue of authority. Given the admissibility of Ms. Dennis’s statement and the absence of any evidence that she lacked authority to consent to the search, we find the evidence was legally sufficient to permit the admission of the items found as a result of that search.

II.

Appellants also object to two other sets of hearsay statements. One police officer testified as to the descriptions of the robbers he received from witnesses at the scene. Another officer testified that one Sam Jones, a cab driver and also Appellant Hunter’s stepfather, informed him: that he heard about the robbery on his cab radio; that Hunter and Collins fit the description broadcast; that his .38 caliber revolver had been stolen; that he suspected Hunter of stealing it; and that he had picked Hunter and Collins up in his cab near the robbery scene and had taken them to Hunter’s home.

The trial judge specifically admitted this testimony solely for the purpose of establishing probable cause to arrest, in the event that question would arise later in the trial. Hearsay evidence of this nature is admissible to prove probable cause to arrest, though it is not admissible on the question of the guilt or innocence of the defendant. Purvis v. State, 27 Md. App. 713, 719 (1975). The trial judge noted the specific and permissible purpose for which he admitted the testimony, and appellants did not challenge his reason.

A trial court is presumed to be able to factor out evidence not to be considered in determining guilt or innocence when it makes its decision on that issue. State v. Hutchinson, 260 Md. 227, 231-34 (1970); Chenault v. Director, 28 Md. App. 357, 361 (1975). We, therefore, find no error in the admission of the hearsay statements.

Judgments affirmed.

Costs to be paid by appellants.


author: Davidson, J.,

text:
    ARTHUR E. COCCO et al. v. MARYLAND COMMISSION ON MEDICAL DISCIPLINE
    [No. 481,
    September Term, 1977.]

      Decided April 12, 1978.

      The cause was argued before Morton, Davidson and Melvin, JJ.

      John F. Fader, II, for appellants Arthur E. Coceo and Frank W. Baker, Jr. James D. Johnson, with whom was Sheldon H. Braiterman on the brief, for appellant, the Unnamed Physician.

      Jack C. Tranter, Assistant Attorney General, with whom was Francis B. Burch, Attorney General, on the brief, for appellee.
   Davidson, J.,

delivered the opinion of the Court.

The Commission, on Medical Discipline of Maryland (the Disciplinary Commission), part of the Department of Health and Mental Hygiene, is authorized, among other things, to discipline a physician for unprofessional conduct by revoking or suspending the physician’s license. The Disciplinary Commission is also authorized to

“issue subpoenas and administer oaths in connection with any investigation, hearing, or proceeding under this section.”

Certain medical review committees, composed of members of the medical staff of a hospital, also may discipline a physician for unprofessional conduct by limiting or terminating the physician’s staff privileges.

On 19 March 1975, the Medical Executive Committee of St. Joseph’s Hospital (the Hospital Review Committee) held a hearing “to evaluate the qualifications, competence and performance” of the appellant Unnamed Physician. The hearing was not concluded and no decision was made.

On 11 October 1976, the appellee, the Disciplinary Commission, in the course of an investigation of a complaint about the medical practices of the Unnamed Physician, issued subpoenas duces tecum to appellant Arthur E. Coceo, M.D., and appellant Frank W. Baker, Jr., M.D., among others. The subpoenas required them “to appear” and “to present records of the [Hospital Review Committee] of St. Joseph’s Hospital pertinent to the privileges and practice of [the Unnamed Physician] at St. Joseph’s Hospital.” The doctors refused to comply.

In the Circuit Court for Baltimore County, the Disciplinary Commission filed a petition for enforcement of its subpoenas. In an answer and motion to quash, the doctors asserted that the proceedings and records of the Hospital Review Committee were “privileged and confidential,” “neither discoverable nor admissible into evidence,” and “otherwise insulated and not available to the Commission.” The Unnamed Physician intervened, asserting that art. 43, § 130 is vague, contradictory and uncertain and that therefore enforcement of the subpoenas would violate due process.

In determining whether to enforce the subpoenas, Judge H. Kemp MacDaniel considered only one of these contentions. Article 43, § 134A (d) provides in pertinent part:

“The proceedings, records, and files of a medical review committee are neither discoverable nor admissible into evidence in any civil action arising out of matters which are being reviewed and evaluated by the committee.” (Emphasis added.)

The trial judge decided that a disciplinary proceeding before the Disciplinary Commission is not a “civil action.” On 5 May 1977, he entered an order enforcing the subpoenas. This appeal is from that order.

Maryland courts have recognized that disciplinary proceedings against a professional have the unique purpose of protecting the public from the results of a professional’s improper conduct, incompetence or unscrupulous practices. They have consistently differentiated such proceedings from civil and criminal proceedings. They have stated that such a proceeding is “neither civil nor criminal in nature” and, more specifically, is not an “action at law” or a “prosecution” or “suit.” These courts have consistently declined to extend to judges, lawyers, and real estate brokers under investigation in professional disciplinary proceedings protections available to civil and criminal defendants in court proceedings. Courts in other states have similarly declined to extend such protections to physicians under investigation in disciplinary proceedings.

We see no difference between protecting the public from improper, unscrupulous or incompetent practices by judges, attorneys, and real estate brokers and the same type of practices by physicians. Nor are we persuaded by considerations of policy to extend to physician disciplinary proceedings, which protect the rights of the public, the same limitations on discovery applicable in civil proceedings, which enforce private rights.

We agree with the trial court that a disciplinary proceeding before the Disciplinary Commission is not a civil action. Accordingly, art. 43, § 134A (d) does not preclude the Disciplinary Commission from issuing a subpoena for the proceedings, records and files of the Hospital Review Committee. We shall not, however, affirm.

An appellate court must decide a case according to existing laws even though the trial court’s judgment, which was correct when made, must be reversed. An appellate court will apply a change in statutory law made after the trial court’s judgment unless vested or accrued substantive rights would be disturbed or unless the Legislature shows a contrary intention.

On 1 July 1977, eight weeks after the trial court’s order of 5 May 1977, Md. Ann. Code, art. 43, § 130A became effective. It provides:

“§ 130A. Required reports to Commission by hospitals and courts.
“(a) Reports of denial, limitation or termination of staff privileges for unprofessional conduct; resignation while under formal accusation. — (1) Each hospital and related institution shall report to the Commission each denial of a physician’s application for staff privileges and each limitation, reduction, or termination of previously granted staff privileges if the action results from any of the causes listed in § 130 (h) of this article as unprofessional conduct, or any voluntary resignation of a physician while the physician is under formal accusation of activities listed in § 130 (h) of this article.
“(2) The report shall be submitted within ten days after the hospital or related institution acts on the staff privileges and shall specify the reasons for the action.
“(3) In no event shall any minutes or notes taken in the course of determining the denial, limitation, reduction or termination of staff privileges be subject to review or discovery by any person.
“(b) Reports of convictions. — Each court shall report to the Commission each conviction of a physician for any crime involving moral turpitude within ten days after the conviction.
“(c) Subpoena power of Commission. — The Commission may enforce this section by subpoena.
“(d) Immunity from civil action. — A person who in good faith provides the information required under this section is immune from civil action for damages resulting from the provision of information.
“(e) Reports not subject to subpoena or discovery. — A report made under this section is not subject to subpoena or discovery proceeding in any civil action except proceedings arising out of hearings and decisions of the Commission.”

Because this law affects procedural rather than substantive rights and because there is no contrary legislative intent, we shall apply this law.

Article 43, § 130A (a) (3) expressly precludes the “review or discovery by any person” of the “minutes or notes” of a hospital pertaining to a change in the status of the physician’s staff privileges. We must first determine whether the Disciplinary Commission is a “person” within the meaning of § 130A (a) (3).

The word “person” when used in a statute ordinarily does not include the State or State agencies. A State or State agency, however, may be included in the word “person” if there is a manifest legislative intent that it be so included. In determining this legislative intent, a court must read the words and provisions of a statute in context. In addition, it may consider the legislative history, including committee reports, and the purpose of the statute. Finally, a court should reconcile and harmonize parts of a statute if possible.

The parts of art. 43, § 130A (a) are interrelated. Subsection (a) (1) requires that hospitals make certain reports to the Disciplinary Commission. Subsection (a) (2) specifies the time of filing and content of the required report. Thus, the context of subsection (a) (3) requires it to be read as describing material which shall neither be included in the report nor otherwise made available to the Disciplinary Commission.

The legislative history of art. 43, § 130A (Senate Bill 263) shows that, as originally proposed, that Bill did not prohibit review or discovery of a hospital’s minutes or notes concerning the status of a physician’s staff privileges. A Senate Finance Committee Report, dated 28 February 1977, recommended, among other things, that the Bill be amended to include such a prohibition and that the Bill as amended be enacted. The report described the purpose of the proposed legislation as follows:

“The bill provides a means by which the Commission on Medical Discipline can learn of, and review each denial or reduction of a physician’s staff privileges, and other occurrences of unprofessional conduct. As amendedthe bill also safeguards the rights of the accused by denying discovery of pertinent notes regarding the investigation of a physician (Emphasis added.)

The Bill was enacted as amended.

This history establishes that the purpose of subsection (a) (3) is to protect an accused physician from the disclosure of certain materials. To accomplish that purpose fully, subsection (a) (3) must be read as excluding minutes or notes concerning the status of a physician’s staff privileges from the material which a hospital is otherwise required to make available to the Disciplinary Commission, a body authorized to impose sanctions upon a physician for unprofessional conduct.

Thus the context, the legislative history, and the purpose of art. 43, § 130A (a) (3) establish a manifest legislative intent that the Disciplinary Commission be included in the word “person.” We now consider the relation between that provision and other parts of the statute.

Article 43, § 130 (i) authorizes the Disciplinary Commission to issue subpoenas. It does not restrict the type of material which a hospital may be required to produce. Article 43, § 130A (c), also authorizes the Disciplinary Commission to issue subpoenas. Article 43, § 130A (a) (3), however, restricts the type of material which a hospital may be required to produce by excluding' “minutes or notes.” That section provides that “[i]n no event” shall those “minutes or notes” be made available to the Disciplinary Commission. Under these circumstances, in order to harmonize and reconcile these three provisions, art. 43, § 130A (a) (3) must be read as restricting the Disciplinary Commission’s authority to compel the production of “minutes or notes,” not only under art. 43, § 130A (c), but also under art. 43, § 130 (i). Accordingly, the Disciplinary Commission cannot subpoena the Hospital Review Committee’s minutes or notes.

The order of the trial court enforced the Disciplinary Commission’s subpoenas which required the production of “records” of the Hospital Review Committee concerning the status of staff privileges of the Unnamed Physician. There was no exclusion of “minutes or notes.” To this extent, these subpoenas are not in accordance with existing law.

As a matter of policy, agency subpoenas should be enforced to the extent they are in accordance with law. Under appropriate circumstances, trial courts may modify subpoenas issued by administrative agencies. Accordingly, we shall reverse the trial court’s 5 May 1977 order and remand the case for further proceedings in accordance with this opinion.

Judgment reversed.

Case remanded for further proceedings in accordance with this opinion.

Costs to be paid by appellants.

      . Md. Ann. Code, art. 43, § 130 (1971 & Cum. Supp. 1977) provides in pertinent part:
      “(a)... The Commission on Medical Discipline of Maryland is hereby established as part of the Department of Health ana Mental Hygiene.
      “(h) Powers of Commission; unprofessional conduct. — When the Commission has completed its investigation according to the process outlined herein, it may reprimand a physician or place him on probation, revoke or suspend his license, or dismiss the charges against the physician....”

      . Md. Ann. Code, art. 43, § 130 (i) (1971).

      . Md. Ann. Code, art. 43, § 134A (b) (3) & (c) (4) (Cum. Supp. 1977); see art. 43, § 130A (a) (1) (Cum. Supp. 1977).

      . The Hospital Review Committee, composed of hospital staff members, is a “medical review committee” which may discipline a physician for unprofessional conduct by limiting or terminating the physician’s staff privileges.

      . Ann. Code, art. 43, § 130 (g) (1) (Cum. Supp. 1977) provides in pertinent part:
      “All investigations, reports, and recommendations shall be considered confidential until such time as a final action is taken by the Commission.”
      Accordingly, a physician under investigation remains anonymous until there is final Disciplinary Commission action.

      . Md. Ann. Code, art. 43, § 130 (g) (1) (Cum. Supp. 1977) provides in pertinent part:
      “The Commission shall refer any cases coming to its attention to the appropriate local county society or committee of the Medical and Chirurgical Faculty of the State of Maryland, for investigation and report____ The report shall contain recommendations the investigation reveals may be necessary for adequate disciplinary procedures. The recommendations shall then be considered Dy the Commission, which shall take whatever action it deems appropriate, as provided herein.”
      The Disciplinary Commission asserted that it had referred the instant complaint to the Baltimore City Medical Society which requested the issuance of the subpoenas.

      . Md. Ann. Code, art. 43, § 130 (1971 & Cum. Supp. 1977).

      . U.S. Const, amend. XIV, § 1.

      . Md. Ann. Code, art. 43, § 134A (d) (Cum. Supp. 1977).

      . Maryland State Bar Ass’n v. Sugarman, 273 Md. 306, 315-18, 329 A. 2d 1, 7 (1974), cert. denied, 420 U. S. 974 (1975); Maryland State Bar Ass’n v. Prank, 272 Md. 528, 533, 325 A. 2d 718, 720 (1974); Braverman v. Bar Ass’n of Baltimore, 209 Md. 328, 348-49, 121 A. 2d 473, 477 (1956); Nelson v. Real Estate Comm’n, 35 Md. App. 334, 339, 370 A. 2d 608, 613 (1977).

        . In re Diener, 268 Md. 659, 670, 304 A. 2d 587, 594 (1973), cert. denied, 415 U. S. 989 (1974); Nelson v. Real Estate Comm’n, 35 Md. App. at 341, 370 A. 2d at 613.

      . Anne Arundel County Bar Ass’n v. Collins, 272 Md. 578, 582, 325 A. 2d 724, 727 (1974); Braverman v. Bar Ass’n of Baltimore, 209 Md. at 336, 121 A. 2d at 477.

      . Nelson v. Real Estate Comm’n, 35 Md. App. at 341, 370 A. 2d at 613.

      . See, e.g., Maryland State Bar Ass'n v. Sugarman, 273 Md. at 318-19, 329 A. 2d at 6 (attorney’s testimony, given after a grant of immunity, may not be used against him in criminal cases but may be used against him in disciplinary proceedings); Anne Arundel County Bar Ass’n v. Collins, 272 Md. at 582, 325 A. 2d at 727 (general statute of limitations barring civil actions not bar to disciplinary proceedings against attorney); Maryland State Bar Ass’n v. Prank, 272 Md. at 535, 325 A. 2d at 721 (principles of double jeopardy and res judicata which bar certain criminal prosecutions not bar to disciplinary proceedings against attorney); Braverman v. Bar Ass’n of Baltimore City, 209 Md. at 337, 121 A. 2d at 477 (formal or technical allegations or descriptions of offense necessary in criminal prosecutions not required in disciplinary proceedings against attorney); Nelson v. Real Estate Comm’n, 35 Md. App. at 342, 370 A. 2d at 613 (statute of limitations barring Erosecution or suit not bar to disciplinary proceedings against real estate roker).

      . See, e.g., Bold v. Board of Medical Examiners, 23 P. 2d 826, 827 (Cal.Dist.Ct.App. 1933) (statute of limitations): Blumberg v. State Bd. of Medical Examiners, 115 A. 439, 440 (N.J. 1921) (statute of limitations); State Medical Examining Bd. v. Stewart, 89 P. 475, 477 (Wash. 1907) (statute of limitations); State v. Josefsberg, 81 N.W.2d 735, 740 (Wis. 1957) (laches).

      . Appellants’ other contentions were not decided by the trial court and need not be considered here. Maryland Rule 1085; McCarty v. E.J. Korvette, Inc., 28 Md. App. 421, 441, 347 A. 2d 253, 266 (1975). Were we to consider these contentions, we would find them to be without merit.

      . Yorkdale Corp. v. Powell, 237 Md. 121, 124, 205 A. 2d 269, 271 (1964); Price v. Nesbitt, 29 Md. 263, 265-67 (1868); Firstman v. Atlantic Constr. & Supply Co., 28 Md. App. 285, 295-98, 345 A. 2d 118, 124-26 (1975); see Gordy v. Prince, 175 Md. 688, 688-89, 7 A. 2d 611, 611 (1939).

      . Yorkdale Corp. v. Powell, 237 Md. at 124, 205 A. 2d at 271; Wade v. St. Mary’s Indus. School, 43 Md. 178, 181 (1875); see Firstman v. Atlantic Constr. & Supply Co., 28 Md. App. at 296-97, 345 A. 2d at 125.

      . Md. Ann. Code, art. 43, § 130A (Cum. Supp. 1977).

      . Monell v. IBM, 378 N.Y.S.2d 615, 617 (Sup. Ct. 1976); see Beechwood Coal Co. v. Lucas, 215 Md. 248, 254, 137 A. 2d 680, 683 (1958); Southerland v. Norris, 74 Md. 326, 328-29, 22 A. 137, 137 (1891); 3 S. Gard, Jones on Evidence § 19.13 at 560 (6th ed. 1972).

      . Harden v. Mass Transit Admin., 277 Md. 399, 408, 354 A. 2d 817, 823-24 (1976); Huffman v. State Roads Comm’n, 152 Md. 566, 584-85, 137 A. 358, 365 (1927).

      . Schweitzer v. Brewer, 280 Md. 430, 438, 374 A. 2d 347, 352 (1977); Walker v. Montgomery County, 244 Md. 98, 102, 223 A. 2d 181, 183 (1966); Wilson v. State, 21 Md. App. 557, 567-68, 321 A. 2d 549, 555 (1974).

      . Blumenthal v. Clerk of the Circuit Court, 278 Md. 398, 404, 365 A. 2d 279, 283 (1976); Public Service Comm’n v. Sun Cab Co., 160 Md. 476, 481, [West v. Sun Cab Co.] 154 A. 100, 103 (1931); Becker v. Crown Central Petroleum Corp., 26 Md. App. 596, 608-10, 340 A. 2d 324, 331-32 (1975).

      . Fairchild Indus, v. Maritime Air Serv., Ltd., 274 Md. 181, 185-86, 333 A. 2d 313, 316 (1975); Sanza v. Md. Bd. of Censors, 245 Md. 319, 340, 226 A. 2d 317, 328 (1967); Becker v. Crown Central Petroleum Corp., 26 Md. App. at 608, 340 A. 2d at 332.

      . Holmes v. Criminal Injuries Compensation Bd., 278 Md. 60, 66, 359 A. 2d 84, 88 (1976); Moaney v. State, 28 Md. App. 408, 420, 346 A. 2d 466, 474 (1975).

      . Enacted as eh. 173, 1977 Md. Laws.

      . See 5 U.S.C.A. § 555(d) (1977); 1 P. Cooper, State Administrative Law-299 (1965).

      . FCC v. Cohn, 154 F. Supp. 899, 911-13 (D.S.D.N.Y. 1957); see, Overby v. United States Fidelity and Guaranty Co., 224 F. 2d 158, 163-64 (5th Cir. 1955); NLRB v. Anchor Rome Mills, 197 F. 2d 447, 449-50 (5th Cir. 1952); In re Grand Jury Subpoena, 203 F. Supp. 575, 580 (D.S.D.N.Y. 1961).


author: Thompson, J.,

text:
    SHELDON J. SINGER et ux. v. STEVEN KOKES, INC.
    [No. 707,
    September Term, 1977.]

      Decided April 12, 1978.

      The cause was argued before Gilbert, C. J., and Thompson and Moore, JJ.

      Ellis J Koch, with whom were O’Malley, Miles, Farrington & McCarthy on the brief, for appellants.

      David Macdonald for appellee.
   Thompson, J.,

delivered the opinion of the Court.

In October of 1973, the appellants, Sheldon J. Singer and his wife, Irene, (the Singers) contracted with the appellee, Steven Kokes, Inc. (Kokes) to construct a house in Potomac, Maryland. Dissatisfied after the house was completed, the Singers instituted this suit in the Circuit Court for Montgomery County claiming Kokes failed to construct the house within the time specified, and the construction was defective. The declaration consisted of one count based on breach of warranty and another based on negligence. Kokes responded to the declaration by filing a general issue plea and a motion for summary judgment on the grounds that the action was barred by res judicata. Judge Ralph G. Shure granted the motion and the Singers appeal arguing: (1) res judicata was inapplicable because the prior suit involved a different cause of action, (2) the defects that constitute the basis of the present suit were unknown at the time of the prior action, and (3) the trial judge erred in awarding attorney’s fees to Kokes under Md. Rule 604.

The prior litigation that forms the basis for the claim of res judicata involves a suit, instituted by Kokes, to foreclose a mechanic’s lien after the Singers refused to release the final draw on the mortgage. As a credit against the lien, the Singers alleged that there were a number of defects in the house and that it was not completed in the specified time. Although the latter claim was rejected by the court, a total of $1,849.96 was allowed as a credit against the lien for various defects. In the process of deciding the matter the court noted the Singers had literally moved in on top of the builder and had constantly harrassed Kokes with changes and complaints. Subsequently, on October 1,1975, less than three months after the suit was completed, the Singers wrote Kokes claiming another 141 defects existed in the house.

I The Bar of Res Judicata

(a) Identity of the Two Causes of Action

In arguing their suit is not barred by res judicata the first contention raised by the Singers is that the two causes of action are different. The argument made in support of this proposition reflects a fundamental misunderstanding of the doctrine of res judicata and is without merit.

The doctrine of res judicata consists of two branches: direct estoppel and collateral estoppel. Direct estoppel prevents the relitigation of all matters which were raised or could have been raised in a prior action between the same parties on the same cause of action. Collateral estoppel, on the other hand, applies where a second suit between the same parties is based on a different cause of action and operates as a bar to those issues actually decided in the prior action. Cook v. State, 281 Md. 665, 381 A. 2d 671, 673 (1978); MPC, Inc. v. Kenny, 279 Md. 29, 32, 367 A. 2d 486, 489 (1977); Felger v. Nichols, 35 Md. App. 182, 183-184, 370 A. 2d 141, 142-143 (1977).

One aspect of direct estoppel is that a party must raise all defenses he has to a cause of action and once that action is concluded he cannot use a defensive matter as a basis for relief in a subsequent action between the parties. Ashman v. Ashman, 201 Md. 445, 450-451, 94 A. 2d 257 (1953). If a matter is not in the nature of a defense but constitutes a counterclaim, the general rule is that the party is not required to assert the claim unless the subject matter is such an integral part of the issue being litigated that a judgment would necessarily negate the existence of facts essential to its maintenance. See Maxcy v. Twilley, 289 Ala. 681, 271 So. 2d 243, 245 (1972); Meyer v. Vance, 406 P. 2d 996, 1001 (Okl. 1965); Gwynn v. Wilhelm, 226 Ore. 606, 360 P. 2d 312, 314 (1961). Once a counterclaim is actually interposed, however, direct estoppel prevents a subsequent suit based on the counterclaim. Hersh v. Allnutt, 252 Md. 513, 518, 250 A. 2d 629, 632 (1969). See Levy v. Business Adjustment Service, Inc., 522 P. 2d 1239 (Colo. App. 1974); Burka v. Seidenberg, 108 A. 2d 159, 160 (D.C. App. 1954); Dowling v. Pound, 214 Ga. 298, 104 S.E.2d 465, 467 (1958); Rothstein v. First National Bank, 141 Ga. App. 526, 233 S.E.2d 802 (1977); Simmons v. Mutual Bene fit Health and Accident Association, 186 Neb. 26, 180 N.W.2d 672, 675-676 (1970).

In alleging the two causes of action are different the Singers argue that the mechanic’s lien was based on a showing of substantial compliance with the contract while their claim is based on a lack of exact compliance. Because of this difference the Singers conclude the evidentiary facts necessary to establish the two causes of action are not identical. In making this argument the Singers completely ignore the nature of the credit that they asserted against the lien. The credit was based on the same breach of warranty that serves as the basis for the present litigation. The issue was fully litigated and the Singers were awarded a credit against the lien of $1,849.96. It is obvious that the credit and the present claim are based on the same cause of action. Thus, direct estoppel prevents the Singers from asserting any matter based on a breach of warranty for defective workmanship which could have been litigated in the prior suit.

(b) Lack of Knowledge

Kokes supported its motion for summary judgment by affidavit and included a partial record of the prior proceedings. Once Kokes had established sufficient grounds for invoking res judicata, the Singers, in order to avoid the entry of summary judgment, were required to show with some precision that res judicata was inapplicable. See Dietz v. Moore, 277 Md. 1, 5, 351 A. 2d 428, 431 (1976); Fishman Construction Co. v. Hansen, 238 Md. 418, 422-423, 209 A. 2d 605, 608 (1965). The Singers attempted to meet this requirement by filing an affidavit stating that a number of the defective items were not known when the original action was tried. The question we must now decide is whether the Singers’ lack of knowledge was, by itself, sufficient to avoid summary judgment on the grounds of res judicata.

Although the general rule is that a party cannot split a cause of action, an exception exists where the party had no knowledge of the facts that form the basis of the latter suit at the time. This exception is inapplicable where the means of obtaining such knowledge existed and the knowledge could have been obtained with ordinary diligence. See Macon & Augusta R.R. Co. v. Garrard, 54 Ga. 327, 329 (1874); Wheeler Savings Bank v. Tracey, 141 Mo. 252, 42 S. W. 946, 947 (1897); Gaither Corp. v. Skinner, 241 N. C. 532, 85 S.E.2d 909, 912 (1955); Holland v. Spear & Co., 193 Misc. 524, 83 N.Y.S.2d 21, 25-26 (1948); Badger v. Badger, 69 Utah 293, 254 P. 784, 787 (1927). Hence, it would be immaterial that the Singers lacked knowledge of the defects, if such knowledge was in their means and could have been obtained through the exercise of ordinary diligence.

The Singers had resided in the house for approximately IIV2 months prior to the trial of the mechanic’s lien. During the trial, they claimed a credit against the lien for 57 various items, and on October 1, 1975, less than three months after the trial had commenced, they sent Kokes a letter containing a list of 141 additional defects. Apparently every item the Singers claimed to be unaware of at the time of the trial was listed. Under these circumstances, we hold the Singers could not avoid the entry of summary judgment by merely alleging they had no knowledge of the defects. Rather, they were required to have shown also that the defects could not have been discovered with reasonable diligence. This they did not do.

II Award of Attorney’s Fees

The final contention raised on appeal is whether the trial judge erred in awarding Kokes attorney’s fees under Md. Rule 604 b. Kokes, in addition to claiming the award was proper, also alleges this appeal was taken in bad faith and requests that it be awarded additional attorney’s fees under Rule 604 b.

(a) Award of Counsel Fees Below

Although counsel fees are not generally recoverable, Empire Realty Co. v. Fleisher, 269 Md. 278, 285, 305 A. 2d 144, 148 (1973); Colonial Carpets, Inc. v. Carpet Fair, Inc., 36 Md. App. 583, 590, 374 A. 2d 419, 423 (1977), an exception to this general rule is contained in Md. Rule 604 b which provides:

“In an action or part of an action, if the court finds that any proceeding was had (1) in bad faith, (2) without substantial justification, or (3) for purposes of delay the court shall require the moving party to pay to the adverse party the amount of the costs thereof and the reasonable expenses incurred by the adverse party in opposing such proceeding, including reasonable attorneys’ fees.”

Under this rule once the trial judge finds the proceedings were instituted in bad faith, without substantial justification, or for purposes of delay an award of counsel fees is mandatory. Waters v. Smith, 277 Md. 189, 197, 352 A. 2d 793, 797 (1976); Colonial Carpets, Inc. v. Carpet Fair, Inc., supra, 36 Md. App. at 591, 374 A. 2d at 424; Hess v. Chalmers, 33 Md. App. 541, 545, 365 A. 2d 294, 296-297 (1976).

In the instant case Judge Shure found the proceedings were part of a “determined effort on the part of Mr. and Mrs. Singer, in bad faith and without justification, to harass the defendant corporation.” The Singers challenge this conclusion arguing their action was supported by plausible legal arguments. We cannot agree. The arguments presented by the Singers were totally devoid of any merit and in light of the circumstances surrounding this case we see no basis for setting aside the award of attorney’s fees.

(b) Award of Attorney’s Fees on Appeal

Kokes also requests, under Rule 604 b, that it be awarded additional attorney’s fees for this appeal. Although fees can be awarded in the trial court under Rule 604 b, that rule does not apply to proceedings in this Court, see Md. Rule 1 a. 1., and there is no comparable rule which permits this Court to make such an award. Although Rule 1082 permits this Court to award costs, counsel fees cannot be taxed as part of the costs absent specific authorization. Empire Realty v. Fleisher, supra, 269 Md. at 286, 305 A. 2d at 148; Colonial Carpets, Inc. v. Carpet Fair, Inc., supra, 36 Md. App. at 590, 374 A. 2d at 424.

Judgment affirmed.

Costs to be paid by appellants.

      . The actual contract was apparently executed by Kokes and Sheldon J. Singer and Irene J. Singer, Inc. A mechanic’s lien and foreclosure proceedings were filed against the Singer corporation and the Singers individually, as owners of the land. The Singers answered in their individual capacity but the corporation did not respond. The suit subsequently proceeded as though the Singers, and not the corporation, executed the contract. The instant suit was also filed by the Singers and not the corporation. As counsel have not raised any question concerning the proper parties to this action, we shall not address the point.

      . Kokes included in its brief a motion to dismiss the appeal on the basis that the order for appeal was not included in the appellants’ record extract. Under Md. Rule 1028 b an appellant is required to include in the record extract “such parts of the record as may reasonably be necessary for the determination of the questions presented by the appeal....”

      . Substantial performance, of course, is not something that is unique to a mechanic’s lien but is a part of general contract law. In the prior action once Kokes showed it substantially complied with the contract, in good faith, it was entitled to the contract price less an allowance for any defects in its performance. See e.g., Gamble v. Woodlea Construction Co., 246 Md. 260, 264-265, 228 A. 2d 243, 245 (1967); Evergreen Amusement Corp. v. Milstead, 206 Md. 610, 621, 112 A. 2d 901, 906 (1955).

      . Under MFC, Inc. v. Kenny, supra, the test for determining whether two causes of action are the same for purposes of invoking res judicata is whether the same evidentiary facts would sustain both actions.

      . The Singers also claim damages based on the negligent construction of the house. Of course, this claim is also barred by direct estoppel as it seeks recovery for matters which could have been raised in the prior suit and is based on the same evidentiary facts as the breach of warranty claim.

      . The Singers stated in their affidavit that the following defects were unknown at the time the mechanic’s lien was tried:
      “Hood duct work broken;”
      “ ‘Aluminum’ flashing rusting out;”
      “Steel plates over garage rusting through;”
      “Nails popping out through dry wall”
      “Front railing tearing loose”
      “Burst water pipe causing:
      Driveway and walk sinking and broken Window well damage, sump pump burned out, water in basement, drain tile broken”
      “Kitchen floor coming up”
      “Plaster breakage in kitchen:
      “Dampness through garage wall causing mildew”
      “Leaks in sliding door”
      In their October 1 letter the following items, among others, were claimed to be defective or the cause of defective items:
      “Nail pops in dry wall in bedrooms”
      “Steel plate over garage door bleeding through”
      “Aluminum flashing over windows rusting and damage resulting” “Metal railing on living room window dislodged”
      “Front walk and driveway sinking”
      “Sliding door in family room floods in tract”
      “Ceiling plaster down [in kitchen]
      “Hood edges unfinished raw wood”
      “Caulking around hood sloppy”
      “Correct water in basement”
      At least one item claimed to be unknown, the kitchen floor, was specifically litigated in the prior action.

      . In their brief the Singers claim that it is obvious that they could not hqye known about the water pipe. However, they did not state in their affidavit when the water pipe broke and it is equally obvious that if it had broken prior to the trial it should have been discovered. The trial judge was not required to speculate on the date the pipe broke. Rather, it was the responsibility of the Singers to furnish facts sufficient to prevent the grant of summary judgment, if they existed.

      . Rule 1 a. 1. provides in part:
      “The Rules in Chapters 100-600 do not apply to the proceedings dealt with in Chapters 700, 800, 900 and 1000.”


author: Gilbert, C. J.,

text:
    FLOWER WORLD OF AMERICA, INC. v. JAMES A. WHITTINGTON et ux.
    [No. 858,
    September Term, 1977.]

      Decided April 12, 1978.

      The cause was argued before Gilbert, C. J., and Mason and Liss, JJ.

      Gary I. Strausberg, with whom were Melnicove, Kaufman & Weiner on the brief, for appellant.

      O. Daniel Kadan for appellees.
   Gilbert, C. J.,

delivered the opinion of the Court.

Md. Cts. & Jud. Proc. Code Ann. § 12-303 (1974), enumerates those instances when an appeal may be prosecuted notwithstanding the interlocutory nature of the order from which the appeal is entered. One of those exceptions to the general rule that no appeal lies save from a final judgment, Md. Cts. & Jud. Proc. Code Ann. § 12-301 (1974), is the “[granting [of] a petition to stay arbitration____” Id. at § 12-303 (c) (9) (Cum. Supp. 1977).

This appeal is concerned not with the granting of a stay, but the ordering of arbitration between Flower World of America, Inc., the appellant, and James A. and Iris R. Whittington, the appellees, with the conditional proviso “that the arbitration proceedings be held in the State of Maryland.”

The appellees rely on Maietta v. Greenfield, 267 Md. 287, 293, 297 A. 2d 244, 247 (1972), to support their position that the order is interlocutory and, hence, not appealable, but for reasons known only to them, they did not move to dismiss the appeal either before the filing of the appellant’s brief, Md. Rule 1036 a, or in the appellees’ brief, Md. Rule 1036 d. The Maietta case, written for the Court by Judge Singley, states “[although we have not had occasion to pass on the precise issue prior to this case ... [an] order directing the parties to arbitrate pursuant to their own contract to do so is an interlocutory, nonappealable order.” (Footnote omitted.) 267 Md. at 293, 297 A. 2d at 247.

If the order of the Circuit Court for Baltimore County had stopped with the command to arbitrate, the appellees’ reliance on Maietta, supra, would be well taken. The difficulty is that the order went further and specified the situs of the arbitration. The question then is not the judicial fiat to arbitrate, but whether a court may designate the geographical location of arbitration, even though the contract between the parties leaves the site of the arbitration proceeding up to the parties or the arbitrators.

Before discussing the appealability vel non of the order in the case now before us, we shall state the factual predicate from which this controversy arose.

On January 27,1976, the appellant, Flower World, entered into a licensing agreement with the Whittingtons. It was agreed that the Whittingtons were to have the use of the trade name, “Flower World,” for a period of ten (10) years with the right to extend for another period of ten (10) years upon certain conditions not here pertinent. Flower World was to provide “assistance and advice, as requested by the” Whittingtons as to location and rental lease, as well as other services of an advisory nature including a complete training program at “Flower World’s headquarters or other designated location.” Additionally, “on the job training” was to be furnished to the Whittingtons for “a maximum of one (1) week” at Flower World’s expense. In the event further training was desired by the Whittingtons, it was available to them for “a per diem charge.”

The Whittingtons agreed to pay to Flower World the sum of one thousand dollars ($1,000) “to be expended for advertising and promotional activities in” the Whittingtons’ “market area.” Moreover, the Whittingtons were required to pay to Flower World “[a]s consideration for the continued right to operate under the license ... a sum of cash equal to three percent (3%) of the ... gross receipts during each calendar month and Two hundred fifty dollars ($250.00) per calendar month.”

The licensing agreement also contained the following significant language in numbered paragraph 23C:

“Except as specifically otherwise provided in this Agreement, the parties hereto agree that any controversy, dispute or question arising out of, in connection with, or in relation to this Agreement or its interpretation, performance, or any breach thereof which cannot be settled amicably between the parties shall be determined solely and exclusively by arbitration under the Federal Arbitration Act, as amended, and in accordance with the then existing rules of the American Arbitration Association, and judgment upon any award, which may include an award of damages, may be entered by the highest State or Federal Court having jurisdiction. However, nothing contained herein shall in any way deprive ... [Flower World] of its right to obtain injunctive or other equitable relief----”

One hundred twenty-nine (129) days later, the Whittingtons filed a declaration in the Circuit Court for Baltimore County against Flower World, a New Jersey corporation. The suit alleged that the Whittingtons had paid to Flower World the sum of seventy-five hundred dollars ($7,500) but Flower World had failed to provide “the schooling as promised, has not granted the franchise license as promised, has not provided nor approved a site location as promised and does refuse to return the ... [Whittington’s] $7500.00.” It was further averred that the Whittingtons had “suffered great mental strain, worry and anguish,” lost job opportunities and were otherwise injured to “$50,000.00 actual and compensatory damages and $50,000.00 punitive damages.”

Flower World petitioned for arbitration, reciting the terms of the agreement of January 27, 1976. The Whittingtons opposed the arbitration and prayed a jury trial on the merits. The hearing judge granted the petition but placed a territorial limitation on the locale of that arbitration. The order read:

“IT IS HEREBY ORDERED, this 26th day of July, 1977, by the Circuit Court for Baltimore County, that the above captioned Petition for Order to Arbitrate filed in the case be granted, PROVIDED that the arbitration proceedings be held in the State of Maryland.”

In this Court the Whittingtons have “changed position as nimbly as if dancing a quadrille.” Despite their opposition in the circuit court to the Petition, they now exhort us to affirm the arbitration order, particularly, we infer, because the playing field belongs to the home team. Flower World, however, steadfastly of the belief that “something is amiss or out of place” in the circuit court’s order urges us to reverse that part of the order that spells out the restriction on where the arbitration is to be held.

The general rule is that an interlocutory order is not immediately appealable, but it may be reviewed on appeal from final judgment. Gittings v. State ex rel. Ockerme, 33 Md. 458 (1871). The reason for the rule is sound. It prevents repeated appeals and the protraction of litigation for indefinite periods. Hillyard Constr. Co. v. Lynch, 256 Md. 375, 260 A. 2d 316 (1970). Were the rule otherwise, the appellate courts would be inundated with all sorts of pretrial rulings to review, which might or might not affect the ultimate outcome of the case. Trials might well be abruptly halted while an aggrieved party seeks redress at the appellate level, and litigants would be placed in the position of a battle of pocketbooks — who had the most money to spend on taking appeals and thus driving his opponent from the courts for want of funds to engage in such dilatory tactics.

The Legislature has seen fit to carve from the general rule of nonappealability of interlocutory orders certain specified types of orders which are immediately appealable. Md. Cts. & Jud. Proc. Code Ann. § 12-303 (Cum. Supp. 1977). The common denominator of the exceptions is the irreparable harm that may be done to one party if he had to await final judgment before entering an appeal. Reversal of the final order because of the time expenditure involved in trial and appeal might “rust the sharpest sword” and “consume the strongest cord.”

In addition to those interlocutory orders which the General Assembly has deemed immediately appealable, the Court of Appeals has appended two (2) others. They are: 1) a denial of a motion to dismiss on the basis of double jeopardy, Neal v. State, 272 Md. 323, 325-28, 322 A. 2d 887, 888-90 (1974); 2) an order which exceeds the jurisdiction of the trial court, Waters v. Smith, 277 Md. 189, 352 A. 2d 793 (1976), aff’g, 27 Md. App. 642, 342 A. 2d 8 (1975).

Patently, the instant case does not fall within the scope of Neal because it is not a criminal cause involving former jeopardy, nor does it bear any resemblance to double jeopardy’s civil counterpart res judicata. If the appeal is to be considered, it must be on the ground that the hearing judge simply did not possess the authority to place the space limitation upon the arbitration. We need not and do not here decide whether any hearing judge may in any case impose such restrictions. Our holding is confined to the agreement to arbitrate as it appears in the record.

We observe that the paragraph of the agreement relative to the submission of disputes to arbitration provides “any controversy, dispute or question arising out of, in connection with, or in relation to ... [the] Agreement ... shall be determined solely and exclusively by arbitration under the Federal Arbitration Act, as amended, and in accordance with the then existing rules of the American Arbitration Association----”

The Federal Arbitration Act “is based upon and confined to the uncontestable federal foundations of ‘control over interstate commerce.’ ” Prima Paint Corp. v. Flood & Conklin Mfg. Co., 388 U. S. 395, 405, 87 S. Ct. 1801, 1806, 18 L.Ed.2d 1270, 1278 (1967).

The federal act, 9 U.S.C. § 2 (1970) provides:

“A written provision in any maritime transaction or a contract evidencing a transaction involving commerce to settle by arbitration a controversy thereafter arising out of such contract or transaction, or the refusal to perform the whole or any part thereof, or an agreement in writing to submit to arbitration an existing controversy arising out of such a contract, transaction, or refusal, shall be valid, irrevocable, and enforceable, save upon such grounds as exist at law or in equity for the revocation of any contract.”

Since the parties’ agreement provided that the arbitration would be determined by the federal act in accordance with the “then existing rules” of the American Arbitration Association, those rules must be read in conjunction with the federal statute. Section 10 of the arbiters’ association rules provides:

“FIXING OF LOCALE — The parties may mutually agree on the locale where the arbitration is to be held. If the locale is not designated within seven days from the date of filing the Demand or Submission the AAA shall have power to determine locale. Its decision shall be final and binding. If any party requests that the hearing be held in a specific locale and the other party files no objection thereto within seven days after notice of the request, the locale shall be the one requested.” []

When the federal arbitration statute is read along with the AAA rules, it is crystal clear that the parties in the instant case may mutually agree on the situs of the arbitration, or either of them may request a specific location to which the other party may interpose objection. The absence of an objection, we deduce, is tantamount to consent. Should the parties not agree, the AAA is empowered to designate the site of the arbitration. That decision is final and binding. The determination by the AAA, as to locale, is, however, subject to limited inquiry as to whether it “[was] made in accordance with a minimum standard of fair dealing.” Aerojet-General Corp. v. American Arbitration Ass’n., 478 F. 2d 248, 251 (9th Cir. 1973). “ ‘Finality’ is a mirage if relied upon to preclude any judicial review of an arbitration award,” Brotherhood of R.R. Trainmen v. Central Ga. Ry. Co., 415 F. 2d 403, 412-13 (5th Cir. 1969), to which we append, “including the selection of the situs of the arbitration.” Although section 20 of the Commercial Arbitration Rules of AAA provides that “[t]he arbitrator shall fix the time and place for each hearing,” the section does not conflict with section 10. Section 20 is directed solely to the time and place within the selected situs.

A case bearing a slight semblance of similarity to that sub judice was decided by the United States District Court for the Southern District of New York. There, the Court said in Network Cinema Corp. v. Glassburn, 357 F. Supp. 169 (S.D.N.Y. 1973), that it had the power to stay an action pending in a Kansas State court after the latter had held, “the said arbitration clause is not enforceable in Kansas and plaintiff is not required to arbitrate this dispute in New York ..Id. at 171-72, notwithstanding the application of the federal arbitration statute to the matter. Manifestly, the federal district court believed that the Kansas court’s order was an infringement on the commerce clause of the Constitution and, hence, invalid.

Under the Federal Arbitration Act, courts are limited to “ascertaining whether the party seeking arbitration is making a claim which on its face is one governed by the agreement.” International Tel. & Tel. Corp. v. Local 400, 286 F. 2d 329, 330-31 (3rd Cir. 1960); Galt v. Libbey-Owens-Ford Glass Co., 376 F. 2d 711 (7th Cir. 1967). Once that issue is decided in the affirmative and the order to submit to arbitration is passed, Md. Cts. & Jud. Proc. Code Ann. § 3-207 (c) (1974), the hearing judge’s role ceases. He possesses neither the express nor implied power to impose conditions which conflict with the federal act. He is not at liberty to designate the locale where the arbitration is to occur. The hearing judge, in the case now before us, was devoid of jurisdiction to specify the geographical confines in which the arbitration was to be held. His order that the arbitration must be conducted in Maryland is a nullity. Such an order is an unwarranted judicial intrusion into the contractual arrangement of the parties. The court was not free to rewrite the arbitration clause of the contract so as to conform to what the court believed should have been written initially.

We have previously noted that an immediate appeal lies “from an order which exceeds the jurisdiction of the trial court.” Waters v. Smith, 277 Md. at 196, 352 A. 2d at 797. See Cohen v. Willett, 269 Md. 194, 195, 304 A. 2d 824, 825 (1973); Montgomery County v. Kaslow, 235 Md. 45, 51, 200 A. 2d 184, 186 (1964). “[A] court cannot improvidently extend the exercise of its discretion to matters which lie beyond its legitimate reach.” Eastern States Corp. v. Eisler, 181 Md. 526, 535, 30 A. 2d 867, 871 (1943); Forbes v. Warfield, 130 Md. 397, 407, 100 A. 630, 634 (1917); Beilman v. Poe, 120 Md. 444, 446, 88 A. 131 (1913); Emory v. Faith, 113 Md. 253, 257, 77 A. 386, 387 (1910). “A court does not have the power, by judicial fiat, to extend its jurisdiction over matters beyond the scope of the authority granted to it by its creators.” Stoll v. Gottlieb, 305 U. S. 165, 171, 59 S. Ct. 134, 137, 83 L. Ed. 104, 108 (1938).

The appeal is properly before us.

We affirm that portion of the order that compels the submission to arbitration of the dispute between the parties. The conditional provision of the order that commands the arbitration to be held in Maryland is reversed and remanded to the circuit court with instruction to strike that clause from the order.

Order affirmed in part and reversed in part.

Case remanded to the circuit court for compliance herewith.

Costs to be paid by appellees.

      . We do not suggest that such a motion would have been successful. Indeed, for the reasons stated infra, it would not. We merely point out that if an appeal is improperly taken the better way of challenging it is by the use of Md. Rule 1036 c or 1036 d.

      . Orloff v. Willoughby, 345 U. S. 83, 87, 73 S. Ct. 534, 537, 97 L. Ed. 842, 846 (1953).

      . Theodore Roethke (1908-1963), The Bat (1941).

      . Sir Walter Scott (1771-1832), Harold the Dauntless, canto I, st. 4 (1817).

      . Id.

      . Md. Rule 605 a allows appeals under certain circumstances from “final” orders which dispose of less than the entire case, but inasmuch as the order is “final” it cannot be interlocutory. Thus, it is really not an exception to the general rule.

      . We interpret the phrase “then existing rules” to mean the operative rules at the time of the referral to arbitration.

      . George Goldberg, A Lawyer’s Guide to Commercial Arbitration, Appendix A, pg. 130 (1977).

      . Id.

      . U. S. Const, art. I, § 8 [Powers of Congress],