source: Caselaw Access Project

author: Menchine, J.,

license: Public Domain

text:
    LEO WALLACE, Indiv. and t/a Leo Wallace Insurance Agency v. THOMAS J. HATEM, Rec’r of the National Guild Insurance Company and Rec’r of National Insurance Underwriters, Inc.
    [No. 168,
    September Term, 1975.]

      Decided December 1, 1975.

      The cause was argued before Morton, Menchine and Mason, JJ;

      A. Jerome Diener, with whom were A. David Gomborov and Gomborov, Steinberg & Schlachman on the brief, for appellant.

      JohnJ. Sweeney, Jr., for appellee.
   Menchine, J.,

delivered the opinion of the Court.

Newton I. Steers, Jr., Insurance Commissioner of Maryland, as Receiver of the National Guild Insurance Company and National Insurance Underwriters, Inc. (receiver), appellee, filed suit in the Superior Court of Baltimore City against Leo Wallace individually and T/A Leo Wallace Insurance Agency (agent), appellant, seeking to collect unpaid premiums in full for insurance policies issued by National Guild Insurance Company (insurer) that had been sold by agent. Prior to trial Thomas J. Hatem, as successor Insurance Commissioner, was substituted as. receiver ©I the two corporations.

Appellee receiver claimed to be entitled to unpaid premiums on policies issued by agent, even though the premiums never had been collected by him, because of the following provisions of an agency agreement executed by agent and insurer, to wit:

“2. The agent shall, unless specifically otherwise directed in writing, collect all premiums on business written for and accepted by the Company and shall transmit .such premiums to the Company on a daily basis. All premiums received by the agent shall be held by the agent as trustee for the Company. The keeping of an account with the agent on the Company’s books,, as a creditor or debtor account, is only a record memorandum of business transacted, and neither such keeping of account, nor alteration in compensation rate, nor failure to enforce prompt remittance or compromise or settlement or declaration of balance of account shall be held to waive the understanding that the premiums collected by the agent are trust funds or change the character of such premiums.” (Emphasis added.)

The agent agreement also provided:

“This Agency Agreement is to be effected through National Insurance Underwriters Inc., 7835 Eastern Avenue, Silver Spring, Maryland, through whom all communications relating thereto shall be transmitted.”

All subsequent accounting procedures had been carried on between agent and National Insurance Underwriters Inc. The receivership included both corporations and no contention is made that the issue before us requires separate rather than joint resolution.

The cause had, in the first instance, been submitted to a special master who recommended entry of judgment for agent for costs. After exceptions to the master’s report had been taken, the case was submitted to Judge Solomon Liss, without the aid of a jury. All evidence that had been submitted to and considered by the master was submitted to the trial judge, who also heard additional testimony. He rejected the recommendation of the master and extended judgment in favor of the receiver.

It is agreed by the parties that at the time of insolvency there were unpaid premiums on policies written by agent totalling $9,029.57, of which $6,710.42 was represented by policies issued to one Applefeld and $2,319.15 was represented by policies issued to other insureds.

Agent appellant disputes liability for the entire claim but alternatively contends that in any case there is no liability attaching to him in connection with the premiums owed on the Applefeld policies.

Trimble v. Coppage, 259 Md. 176, 269 A. 2d 563 (1970) is plain authority for these propositions:

1. That unremitted and unearned premiums in the hands of an agent are assets of the estate of an insolvent insurer (p. 181 [566]); and
2. That an agent is liable to the receiver for uncollected premiums as to which credit had been extended by the agent, if responsibility for their payment had been undertaken by the agent under the provisions of his agency agreement (p. 179 [564]). In that case the agent was held liable to the receiver for such uncollected credit premiums.

Agent appellant suggests, however, that Trimble, supra, is distinguishable because the agency agreement in that case contained the specific language “Agent agree[d] to pay General Agent all'premiums accruing on insurance written under this Agreement, whether or not collected by Agent from the' insured.” Comparing that languáge with the language of the subject agency agreement as heretofore recited, agent contends that he did not undertake to assure payment to the insurer of premium , payments for which credit had been extended. He argues, in sum, that the language of the agency agreement obligated him to transmit to the insurer only those premiums collected by him without any assumption of personal responsibility to insurer for payment of premiums for which credit had been extended.

In Eagle Ins. Co. v. Albright, 474 P. 2d 920 (Wash. App. 1970) insurer and agent had entered into an agency agreement that in pertinent part read as follows:

“(1) Agent has full power and authority to receive and accept proposals for insurance covering such classes of risks as the Company may, from time to time, authorize to be insured; to collect, receive and receipt for premiums on insurance tendered by the Agent to and accepted by the Company and to retain out of premiums so collected, as full compensation on business so placed with the Company, commissions as may be from time to time mutually agreed upon.” (p. 923)

In positing the question before it, the court said:

“The central issue of this case is the question of defendant’s liability for uncollected and unremitted premiums. A resolution of this question depends on interpretation of the agreement between the parties. The trial court did not think there was any ambiguity in the agreement and refused to give the defendant’s proposed instruction No. 5, which instructed the jury that the agreement was ambiguous. Instead, the court gave instruction No. 8, advising the jury, in effect, that defendant was liable for all premiums, whether or not collected from subagents or assureds.
“We think that there was no error in the trial court’s action regarding these instructions on ambiguity. This is true even if it is conceded that the written agency agreement in question in this case is less than a model of clarity.” (p. 927)

The evidence in Albright, supra, included a showing that by the accounting practice of both parties the entire amount of the premium, collected or not, was shown as the amount owing from agent to insurer.

In the subject case the same accounting practice was followed. Norman Davis, Treasurer and Office Manager of both insolvent corporations, testified that a detailed account current was issued to the agent each month, listing all transactions for that month.

Continental Casualty Co. v. Easley, 290 S. W. 251 (Tex. Civ. App. 1926) at page 253 said:

“An account current is a statement by the agent in which he includes all policies written during that month and all return premiums on policies canceled during that month, and brings down his net premiums less his commission and whatever other charges or balances are due the company for the transactions during that month, regardless of whether or not the premiums were paid or collected.”

In Hershey v. Kennedy & Ely Ins., 294 F. Supp. 554 (D.C. S.D. Fla. 1967) aff’d 405 F. 2d 888 (1968), the agency agreement in pertinent part read as follows:

“The agent shall collect all premiums on policies and binders issued by it. Such premiums shall be held and handled as trust funds belonging to the company.” (p. 556)

The court said at page 558:

“Under such agreement any policies written by the agent upon credit were written at the agent’s own risk as to whether or not the agent could or cohid not collect such premiums. Any extension of credit by the agent without the express authority by the company where the agency agreement requires an accounting, as it does here, is done at the risk of the agent. The agent’s liability is not that of a guarantor but is an original undertaking.”

See also Daniels-Greager v. Caledonian Ins. Co., 86 P. 2d 264 (Colo. 1939); Fireman’s Fund Ins. Co. v. Cadillac Ins. Agency, Inc., 262 N. W. 312 (Mich. 1935).

The general rule is thus stated in 32 C. J. § 150 (p. 1072):

“Where an agent is authorized to collect premiums, it is his duty to account for all premiums which he has collected, or which he should have collected.”

In 16 Appleman, Insurance Law and Practice, § 8786 (p. 389) (rev. vol. 16, 1968) it is said:

“An agency agreement may require the agent to remit all premiums reported due, not only those premiums actually collected. Where a contract of insurance is accepted by the insurer, the agent, delivering the policy on part payment of cash and the balance evidenced by the insured’s notes, is liable for the premium due. An agent extending credit to the insured for a premium beyond the time the insurer allows the agent to collect the premium becomes originally liable, not merely as guarantor; and where such agent personally extending credit fails to remit the insurer’s portion of the premium and the agency is terminated, the insurer has a valid claim against the agent.”

We conclude that under the agency agreement a debtor-creditor relationship was created, whereby the agent assumed the risk of collection of premiums as to which he had extended credit. Acceptance of the specific burden to collect all premiums on business written for and accepted by the company, carried with it the implied obligation to assure the payment of premiums as to which he had extended credit. Under that agreement and in the absence of credit authority “specifically * * * directed in writing” by the insurer, agent became liable to the insurer and is liable to the receiver.

The Applefeld Premiums

Appellant contends that insurer “agreed to the financing of the Applefeld premiums” pointing to Defendant’s Exhibits 7 and 11. There can be no doubt that those exhibits, standing alone, would support a conclusion by a trier of facts that financing of the Applefeld premiums had indeed been authorized. There is, how'ever, clear evidence in the record from other sources, tending to show' that no financing of such premiums had been authorized by the insurer.

The trial judge, giving consideration to that conflicting evidence, concluded that insurer had not authorized extension of credit to Applefeld. We cannot say that his decision w'as clearly erroneous. Rule 1086.

Judgment affirmed.

Costs to be paid by appellant.

      . “[B]y instruction No. 8, the court, in effect, instructed the jury that the agency agreement created a debtor-creditor relationship with regard to premiums, whether collected or not.” (p. 925)


author: Melvin, J.,

text:
    WASHINGTON HOMES, INC. v. INTERSTATE GENERAL DEVELOPMENT, INC., et al.
    [No. 177,
    September Term, 1975.]

      Decided December 2, 1975.

      The cause was argued before Orth, C. J., and Gilbert and Melvin, JJ.

      Richard E. Ekstrand, with whom were Paul M. Nussbaum, and Reichelt, Nussbaum & Brown on the brief, for appellant.

      F. George Heinze, with whom were Mudd, Mudd, Munday & Heinze on the brief, for appellees.
   Melvin, J.,

delivered the opinion of the Court.

This is an appeal from a January 24, 1975 Order of the Circuit Court for Charles County declaring that appellant, Washington Homes, Inc. (Washington Homes), no longer has any rights in an option to purchase “approximately 253 lots” located in an area of Charles County known as the Wakefield Neighborhood. One of the appellees, Interstate General Development, Inc. (Interstate General) was the sole original plaintiff in a suit brought in equity against Washington Homes under the Uniform Declaratory Judgment Act (codified in Courts and Judicial Proceedings Article of the Code (1974), §§ 3-401 through 3-415) seeking a declaration that Washington Homes had failed to exercise the option within the option period.

In its appeal from the January 24, 1975 Order Washington Homes argues two grounds for reversal:

“I. The trial Court erred when it, sua sponte, amended the pleadings to add a necessary party Plaintiff at a time during a hearing which was set for the sole purpose of the trial Court issuing its opinion, and prior to which time the parties had rested.
II. The trial Court erred when it held that the option agreement was too vague to be enforceable.”

I

The pertinent facts concerning the disputed amendment appear to be these:

On June 23, 1972, Washington Homes, as “Purchaser”, signed an “Agreement for the Sale and Development of Lots”. The other party to the agreement, designated therein “Seller”, was a corporation named Interstate Land Development Company, Inc. (Interstate Land), the other appellee named in this appeal. Under the agreement Washington Homes agreed to purchase from Interstate Land 253 single family residential lots of varying sizes at various prices per lot.

The agreement contained the following recitals:

“WHEREAS, Seller is the owner and developer of St. Charles Communities (St. Charles) in Charles County, Maryland, and
WHEREAS, Purchaser is desirous of acquiring 253 single family residential lots in the Bannister Neighborhood for the purpose of building houses on said lots for sale to the public, and Seller is desirous of selling same.” (Emphasis added.)

In addition to providing for the sale of the 253 lots in “the Bannister Neighborhood”, the agreement gave Washington Homes an option “to purchase approximately 253 lots in the Wakefield Neighborhood”. The option clause reads as follows:

“Since the 253 lots being purchased hereunder are in the Bannister Neighborhood of St. Charles, Seller hereby gives to Purchaser an option, subject to the provisions of this paragraph, to purchase approximately 253 lots in the Wakefield Neighborhood (under the same terms and conditions as this Agreement, excepting those provisions relating to charges for sewer and water services, advertising and promotional incentives, plus any extraordinary items, it being understood that Seller is to notify Purchaser of such additional costs, if any, no later than 60 days prior to the expiration of this option) at a price not in excess of 110% of the price per lot in varying sizes being paid hereunder. This option shall continue for a period of two years from the date of this Agreement, and if not exercised in writing on or before such time it shall automatically expire and be of no further force and effect.”

By a purchase agreement dated March 29, 1973, while the-option was still unexercised, Interstate Land sold its interest in the Bannister Neighborhood property to Interstate General. On the same date a deed was executed by Interstate Land conveying the Bannister Neighborhood property to Interstate General. The deed was duly recorded among the land records of Charles County on April 9, 1973. By the terms of the March 29, 1973 agreement Interstate Land assigned to Interstate General the “Contract dated June 23, 1972, between Seller [Interstate Land] and Washington Homes, Inc. [appellant]” and Interstate General agreed to comply with the terms of the assigned contract. However, the assignment specifically excluded Interstate Land’s “rights, remedies, obligations concerning options on land outside” the Bannister Neighborhood. Thus, it is clear that neither the deed nor the agreement gave Interstate General any interest whatsoever in the Wakefield Neighborhood property, nor did they affect in any way the respective rights of Interstate Land and Washington Homes in the option held by Washington Homes on the “approximately 253 lots in the Wakefield Neighborhood”.

The bill of complaint filed by Interstate General on September 6, 1974, alleged that it was the assignee of the June 23, 1972 agreement between Interstate Land and Washington Homes. Washington Homes’ answer to the bill of complaint stated that it was “without knowledge and, therefore, neither admits nor denies” that Interstate General was the assignee of the June 23,1972 agreement.

At trial, counsel for Washington Homes persisted throughout that the only plaintiff in the case, Interstate General, was “the wrong corporation to bring the suit”. Counsel for Interstate General was just as persistent that Interstate General was the proper party to bring the suit. At the end of the plaintiffs case counsel moved for a dismissal on that ground. The following colloquy then took place between the trial judge and counsel for Washington Homes:

“THE COURT: If I deny your motion, are you going to have any evidence?
MR. NUSSBAUM: I don’t think I need any, Your Honor.
THE COURT: Why don’t you — I will reserve ruling on your motion and let you go ahead with your evidence.
MR. NUSSBAUM: Very well, Your Honor.
THE COURT: So as to get rid of testimony.
MR. NUSSBAUM: You are absolutely correct. I have no evidence to put on.
THE COURT: You have no evidence?
MR. NUSSBAUM: No, sir.”

After final arguments to the court the trial judge held the matter sub curia pending receipt of memoranda from both parties. Thirty days later, on January 6, 1975, the trial judge rendered his oral opinion in open court, during the course of which he said: Counsel for Interstate General said “We have no objection whatsoever to the proposed amendment. . . .” Counsel for Washington Homes, however, did object to the amendment. At the trial judge’s request he stated his reasons for objecting:

“It would appear, therefore, that we still do not have the proper Plaintiff in this case, Plaintiff having been amended to Interstate General Development, Inc., except that somewhere in these proceedings it is indicated that Interstate General Development, Inc., is the owner of all the stock issued and outstanding in Interstate Land Development Company, Inc.
I would think that for the case to be properly before the Court that Interstate Land Development Company, Inc. should be made a party Plaintiff in these proceedings. (Emphasis supplied).
Is there any objection to amendment?”
“MR. NUSSBAUM: My reason, Your Honor, is that in the companion case, Equity Number 3694, the Plaintiff has recently filed an amended bill of complaint. I have, I think, within the last week propounded interrogatories upon the Plaintiff, seeking the answers to numerous interrogatories, among which is this particular question, and I feel that until the Plaintiff under oath in response to interrogatories, propounded by me in Equity 3694 is going to answer questions as to the corporate relationship, I feel that I have a right, if not altogether a duty, to oppose- any amendment at this point.”

Counsel for Interstate General responded:

“MR. MUDD: Your Honor, in response to that, I think the Court has correctly heard the testimony under oath in this case, that Interstate Land Development Company stock is entirely owned by Interstate General Development, Inc., and that being under oath, again in an effort to simply get to the basic issue as to whether or not an option was exercised and is still in existence, I think any further delay would be just a farce from the Court.”

The trial judge thereupon overruled the objection and said, “I will .. . permit the addition of Interstate Land Development Company, Inc. as a party Plaintiff in the proceedings”. The judge then continued with his oral opinion in which, without deciding whether the option had been exercised, he concluded that the option clause was too vague and indefinite to be enforceable. This was followed by the written Order, dated January 24, 1975, and entered on January 27, 1975, from which Washington Homes has taken this appeal.

It is clear that Interstate General had no legally recognizable interest in the option agreement. It therefore was not a proper party to bring declaratory judgment proceedings. This fact, however, was not clear to appellees’ trial counsel. It is apparent from the record that throughout the trial below they mistakenly believed that the March 27, 1973 purchase agreement between Interstate General and Interstate Land effectively assigned to the former the latter’s interest in the option agreement contained within the June 23, 1972 Agreement between Interstate Land and Washington Homes. In his brief to this Court counsel for appellees (one of the same counsel who represented Interstate General at trial) said: “This writer did not notice that exclusion and argued accordingly. That mistake was not perpetuated by the trial Court who upon considering the record, pointed out the need to add Interstate Land Development Company, Inc. as a, Party Plaintiff.” (Emphasis added).

We note at the outset that both parties to this appeal seem to have proceeded on the assumption that an amendment was actually made adding Interstate Land as a party plaintiff.

However, so far as the record reveals, all the trial judge did sua sponte was to state the need for an amendment 3and say he would “permit” it. Md. Rule 320 d 2 permits an amendment to be “made orally in open court”. We find nothing in the record indicating that the amendment was actually made even orally. Counsel for Interstate General at no time requested an amendment and after being informed by the trial judge that he would “permit” one, said nothing further concerning it; nor do any of the pleadings filed in the case prior to the entry of the final order on January 27, 1975, indicate, by interlineation or otherwise, that Interstate Land ever became a party to the proceedings. Nevertheless, since the point was not argued, and since we dispose of the appeal on another ground, we shall assume, without deciding, that an amendment was actually made adding Interstate Land as a party plaintiff. The question, then, is whether it was reversible error to have permitted the amendment under the circumstances. Appellant argues that it was. We agree.

Maryland Rule 320 b 1 provides in pertinent part:

“. . . When an amendment is made to correct nonjoinder or misjoinder, some one of the original plaintiffs and some one of the original defendants must remain as parties to the action.” (Emphasis added.)

Our interpretation of this part of the rule is that an amendment to correct nonjoinder or misjoinder may not be made unless at least one of the original plaintiffs and at least one of the original defendants would, after the amendment is made, remain in the case as proper parties to the action.

In the case at hand, the amendment (assuming it to have been made) purported to add Interstate Land as a proper party plaintiff, leaving Interstate General still in the case as the original plaintiff. The clear effect of the amendment, however, was not simply to add Interstate Land as a party -plaintiff, but, instead, to substitute it for Interstate General, the only original party to the action. Interstate General as a .separate legal entity, as the trial court correctly held, had no rights under the option and was not a proper party to the action. Under these circumstances the mere fact that Interstate General’s name “remained” in the caption of the case as a party plaintiff did not satisfy the rule’s requirement that “some one of the original plaintiffs . . . must remain as parties to the action”.

In Illian v. Northwestern Ins. Co., 215 Md. 507 (1958), the executrix of one of three partners in a dress shop brought suit to recover loss from fire on a fire insurance policy that had been issued jointly to all three partners. At the time suit was brought, the other two partners were living but did not join as party plaintiffs. The Court of Appeals, in an opinion by Judge Hammond (later Chief Judge), held that under partnership law the executrix was not a proper party to bring the action and affirmed the trial court’s summary judgment in favor of the defendant insurance company. In answer to the executrix’s argument on appeal that she should be permitted to amend so as to bring in the surviving partners (Houser and Farley) as parties plaintiff with her, Judge Hammond said, at p. 517:

“. . . [U]nder Maryland Rule 320 b 2 (a) [the provisions of which are now contained in Rule 320 b 1] ... when an amendment is allowed for nonjoinder or misjoinder, some one of the original plaintiffs and some one of the original defendants must remain as parties to the action. Since Houser and Farley ivere the ones who should be plaintiffs and Illian, as executrix, has no right to be a plaintiff, or join in the action, there could be no amendment such as Illian requests.” (Emphasis supplied.)

In the instant case, Interstate Land was the proper party to seek declaratory relief. Interstate General had no right to be a plaintiff, or join in the action; therefore, there could be no amendment such as proposed by the trial court.

Appellees’ reliance on Ehrlich v. Board of Education of Baltimore County, 257 Md. 542 (1970) is misplaced. In that case the Board of Education of Baltimore County brought suit in 1966 against Ehrlich, a former professor at the Essex Community College, to recover for breach of an agreement whereby Ehrlich was given money for a sabbatical leave on condition that he return to teach at the college upon expiration of his leave. He had been originally employed by the Board of Education in 1957 and worked as a professor at the college until 1964 when the leave was granted. Chapter 134 of the Acts of 1961 provided that “for the purpose of administration over these colleges [including Essex Community College] the Board of Education shall constitute a board of trustees and governmental corporation vested with the following powers . . ..” Thus, at the time the sabbatical leave was granted Ehrlich’s employer was, as the Court of Appeals held, “technically the Board of Trustees, although . .. the same individuals served on both boards”, at p. 547. In approving the trial court’s granting of a motion to add the Board of Trustees as a party plaintiff, the Court said, at 548, “In the instant case we do not believe that there was a change in the real party in interest”. The Court also noted that Ehrlich filed a counterclaim against the Board of Education in the same case, “thereby indicating that in his own mind he made no distinction between the Board of Trustees and the Board of Education, insofar as liability for a breach of this contract was concerned.”

Ehrlich is distinguishable from the case before us in at least two aspects: 1) By Chapter .134 of the Acts of 1961, the two plaintiffs were, in legal effect, made one and the same party for “the purpose of administration over” the Essex Community College. In the instant case, the two plaintiffs are, in fact, two different legal entities. 2) Ehrlich himself demonstrated he suffered no prejudice from the amendment. In the instant case, it is apparent that in defending the suit against it, appellant (as it had a right to do) relied heavily upon its conviction that the “wrong corporation” was named as plaintiff. Counsel for appellant made it clear during the trial that if the right corporation brought the suit, his response would not merely be an answer to the bill of complaint, but a counter suit as well. Under the circumstances we cannot say that Washington Homes was not prejudiced by the amendment, coming as it did at the close of all the evidence while the trial judge was delivering his oral opinion on the merits of the case.

We conclude that, even assuming an amendment was made adding Interstate Land as a party plaintiff, it was error for the trial judge to have permitted such an amendment over appellant’s objection. The amendment violated the mandatory provisions of Rule 320 b 1. It follows that it was also error for the trial court to have proceeded to declare the respective rights of Interstate Land and Washington Homes as if Interstate Land had.been properly added as a party before the court. Under the circumstances the trial court’s only proper course was to deny the declaration requested and dismiss the bill of complaint. Goss v. Hill, 219 Md. 304, 307 (1959).

In view of our holding on the amendment issue it is unnecessary to consider the second issue raised by the appellant and we express no opinion thereon.

Judgment reversed; case remanded with directions to dismiss the bill of complaint; costs to be paid by appellees.

      . The “companion case” (Equity No. 3694) is a suit between the same parties (i.e., Interstate General and Washington Homes) wherein Interstate General, on the strength of its assignment and deed from Interstate Land, sought specific performance of the June 23, 1972 Agreement wherein Washington Homes agreed to purchase from Interstate Land 253 lots in the Bannister Neighborhood. The two cases had been consolidated for trial and the trial, which took place on December 6, 1974, began as a trial of the issues in both cases. During the trial, counsel for Washington Homes brought out that the bill of complaint in the specific performance case alleged that Interstate Land “is the owner and developer of St. Charles Communities in Charles County”. He therefore objected to the introduction into evidence of the deed from Interstate Land to Interstate General as being “an attempt now to rebut the pleadings” and as being “contrary to the pleadings”. The trial judge agreed that amendment was needed and granted Interstate General “fifteen days in which to amend the bill of complaint” and granted Washington Homes fifteen days “to file responsive pleadings” to the amended bill of complaint. The parties then proceeded with the trial of the issues in the declaratory judgment case, which is the case sub judice in this appeal.

      . Zell v. Zell, 12 Md. App. 563, 565 (1971), is authority for the proposition that amendments “may properly be suggested by the court in the interest of justice.”

      . Md. Rule 320 c 1 provides: “In a case heard before the court without a jury, any amendment may be made at any time before a final judgm,ent or decree is entered”. (Emphasis added.)

      . See Lohrfink v. Still, 10 Md. 530 (1857) and Scarlett v. The Academy of Music, 43 Md. 203, 208 (1875), for the proposition that “a permission to amend does not, per se, amount to an amendment”. These cases were, of course, decided long before amendments were allowed to be made orally in open court without leave of court. See present Rule 320 d 1 (“An amendment may be made without leave of court subject to the right of objection made pursuant to Rule 320 d 5”) and present Rule 320 d 2 (“An amendment shall be made in writing, except when made orally in open court”). Both of these rules became effective July 1,1974. It seems doubtful, however, even under the liberalized amendment rules, where the court sua sponte suggests an amendment and counsel for one party says he has no objection to the amendment, that counsel has thereby, without more, “made” the amendment “orally” or otherwise. We find it unnecessary to decide whether the court itself may sua sponte effect an amendment or, if it may, whether the trial court did so in the instant case.


author:
Moore, J.,
      'Powers,'J'.',

text:
    MACK TRUCKS, INC. v. LAWRENCE DELBERT WEBBER et al.
    [No. 193,
    September Term, 1975.]

      Decided December 2, 1975.

      The cause was argued before Powers, Davidson and Moore, JJ.

      Richard H. Lerch, with whom were Lerch & Huesman on the brief, for appellant.

      Patrick A. O’Doherty, with whom was, James J. White, III, on the brief, for appellees.
   Moore, J.,

delivered the opinion of the Court. Powers, J., dissents and filed a dissenting opinion at page 278 infra.

This appeal arises following an award of compensatory damages in the sum of $380,000 to Lawrence Delbert Webber (plaintiff-appellee)* by a jury in the Circuit Court for Cecil County (Mackey, J. presiding) in an action for personal injuries against Mack Trucks, Inc. (appellant-defendant) wherein the latter conceded its negligence. Two grounds of error are claimed: (a) that Mack Trucks’ iñdtrotf’:fdr: ■sü'mm-ary .judgmént -based, ¡üpon- The -.three-year statute of limitations was improperly denied and (b) Alternatively; That it--was'an-.abuse of ,discretjo,n for ;.the t-fiál1 *cóuftTP deny .Mack Trucks’-¡second motipn -fpr. á new tfiál, filed;-pursuant to Maryland Rule 625 b) ¡53 days after t'fiá-l,--ón the basis of newly disco.vfer.ed evidence: ", • -, -,;

!5 'MrrWeb'béf/théri' 22 years:-old,-was employed as-a; driver 'of ^Tractor and; tráiler -by Trego-'Brothers-, Inc.; a' Maryland .cbrjjdr’atióií;;nh ■ Eebr'iiány• ‘26/11970'. On • that: date «he-¡was involved! in 'iv/ó 'áceidénts!'Tn -the morning--a broken hose-in ;tHe ah; brake’Tj/fetenr caused him -to -have a- low-spefed eólíisi'ofr 'With' an a-útdmobilé on U.S;-Route-'40 in Cecil ’County! lh that incident'the car received'minor-damage and appellee’s ‘truck was unscathed, as were' -appellee and the driver of the other’’vehicle’. After repairing the'brake, system, appellee resumed operation <• of; his-TractPrTrailer/ That ■‘afternoon,-while-.d-riving on Interstate. Route 95 jn Harford County with a load of approximately seventeen tons of, rpck salt, an aluminum spring bracket cap on the tractor broke cáusin’g disengagement-of; t-hé -spring-suspension system, resulting in complete loss of control -by the. driver. While traversing .approximately one-half mile of a gentle downhill gfaáe'the truck' moved 'inexorably from- the rightr-hand northbound lane through the passing‘lane; onto the grassy medial, onto .the southbound, or “wrong” lanes, and finally into a,ditch .heybnd'thé 'southbound lánes. The tractor-trailer overturned and caught fife. Appellee' w'as tfapped inside oifitik'rescued .byUwo passing truck drivers: -He sustained ■ serious injuries.-• ' . f. -,- .... -

Januafy’22,T:973, a little more than one month prior to the; end of'the--three-year period-of limitations," Mr.-Webber bhohgHU'an■'-action' against"1 Mack Trucks,. .The,; ;as--the manufacturer of the tractor, alleging negligence, breach of warranty, and strict liability. Plaintiff-appellee incorrectly recited in the declaration that the accident in which he was injured had occurred at the sftus of the minor morning accident in Cecil County — and also named as a second party defendant the driver of the passenger vehicle which had been involved in the earlier mishap. The facts alleged were that defendant had manufactured and sold the tractor-trailer and that

“suddenly and without warning a mechanical or structural defect or failure on the aforesaid tractor caused .the Plaintiff to lose control of the aforesaid tractor and dump trailer; and as a direct result the Plaintiff was involved in an accident with another vehicle ... in .which accident the Plaintiff was injured and damaged.” (Emphasis added.)

•' Mack Trucks filed geiidra! issue pleas to the negligence and warranty counts" and served interrogatories on' plaintiff on March 15, 1973. Interrogatory number 5 was: “Give a concise statement of the facts relied upon by you to support your claim that the defendant was negligent.” On March 29, plaintiff responded to the interrogatories and his answer to number 5 was:

“A spring bracket cap of a tractor/dump-trailer that was. manufactured by the defendant broke causing disengagement of the spring suspension system of the vehicle operated by the plaintiff which resulted ■ in the upset and crash of the vehicle. The cap broke because of a mechanical deficiency in the cap. The mechanical deficiency was caused by the defendant, its agent, or employees.”

Another answer stated that the accident had been investigated by Trooper Daniel H. Mahan. (It was eventually discovered that Officer Mahan had investigated the morning accident but a different officer had investigated the serious afternoon accident in which Mr. Webber was injured.)

On January 9, 1974, with the consent of appellees, Mack Trucks, Inc. filed a “Third Party Complaint” pursuant to Maryland Rule 315. b against Arrow Aluminum Castings Company, an Ohio corporation, the manufacturer of the defective aluminum spring bracket cap.

On May 30, 1974, Mack Trucks deposed Mr. Webber. On that occasion it became clear that Mr. Webber had been involved in two accidents on the same day, in two different counties, and that the site of the accident recited in the declaration was not the site at which he had been injured. (As previously stated, no personal injuries and no significant property damage were sustained in the morning occurrence-in Cecil County.)

Appellant thereupon moved for summary judgment on the ground that appellee had not been injured or damaged in an accident on U. S. Route 40 in Cecil County. Appellee’s counsel, James J. White, III, Esq., interposed an answer to the motion for summary judgment wherein it was stated that the allegation in the declaration that Mr. Webber’s injury was sustained at the intersection of U.S. Route 40 and Maryland Route 272 was inadvertent and that leave to amend the declaration would be requested. Annexed to the answer was an affidavit of Mr. White in which it was averred that he was unaware that Mr. Webber had been involved in two accidents until May 30,1974.

Judge Mackey denied defendant’s motion for summary judgment and granted plaintiff leave to amend. On September 3, 1974, plaintiff filed an amended declaration which omitted the cause of action alleged against the original co-defendant and correctly recited the location of the accident which caused his injuries. The negligence allegations were identical to those contained in the original declaration — “that a mechanical or structural defect or failure . . . caused the plaintiff to lose control of the aforesaid tractor. . . .”

On September 9, 1974, appellant filed general issue pleas to the counts sounding in negligence and breach of warranty, and also specially pleaded that the action was barred by limitations. The special plea was based on Mack Trucks’ position that the amended declaration stated a new cause of action and therefore was not timely. It appears that the trial court ordered the submission of memoranda on the issue of limitations and the record discloses that a hearing thereon was held in open court on November 15, 1974. On December 5, 1974, the court filed an “Opinion in Support of Denial of Plea of Limitations” and the case was set in for trial on January 27, 1975. The trial was brief. The only testimony received was that of Webber, his own examining physician, Dr. Eli Lippman, an orthopedic surgeon, and the State Trooper who investigated the afternoon accident. Hospital records and medical bills were stipulated, as was actuarial testimony and the report of Mack Trucks’ examining orthopedic surgeon, Dr. G. Edward Reahl, Jr., dated January 22, 1975. The jury’s verdict in favor of appellees was returned at 5:10 p.m. on January 27,1975.

Appellant moved for a new trial on the grounds that the award of $380,000 was excessive and that the trial court erred in its instructions to the jury. After a hearing on February 25,1975 Judge Mackey denied the motion.

On March 19, 1975, Mack Trucks again moved for a new trial. On this occasion the motion was pursuant to Maryland Rule 625 b claiming newly discovered evidence. As a result of an anonymous telephone call to appellant’s counsel after the trial, appellant charged that it had obtained previously unavailable evidencié'reflecting a. greater, éámlhg capacity on plk.int.iffs part'than bad beeii before'the court at trial. At a. hearing on .March 27,.T975''thé motion took‘denied in a ruling from the bench. The 'trial court Held that appellant;, through, the exercise of due diligence prior to and during 'trial,, should' have 'bébri'aware''bf" Wébber’s';ihcoihe-gródúcihg' ‘activities. since'the'dateafthe'ácci'd.e’flU , ‘ 1

IMack'Truck's;' The.,' raises two'contentions' here. It.1 argues-that its'plea oflimitatidris should.nave barred plaintiffs suit because!'fhe'.améjidéd declaration’ stated a new cause of action. The second point®appellant makes Is. that if the claim wa:S not!barred'by.'..liriiitatMns, a rieVtrial should have been' ordered, .! , . . • .’■■•! ’ :

I

THE STATUTE , GF LIMITATIONS

'‘The'iaw;'is cib'ar 'thafi'f an amended' 'declaration sets out® a: neto eadsebfa'etlbh-the’’tibíe period:fób■limitationspurposes' is® meáSured'’’froih® the-daté'pnbwhich the causd'of action accrued to;; the !:dáté‘' 'the * 'amended' pleading1 ' is ® filed: If,' however, rib new cause is set out by'the amendhieht then'the doctrine® df; relation back applies/' arid the question'-‘of limitations’is determined with‘reference-to. the'date of the original'filing. Crowe v. Housework, 272 Md. 481, 325 A. 2d 592 (1974); Doughty v. Prettyman, 219 Md. 83, 148 A. 2d 438 (1959); Cline v. Fountain Rock Lime and Brick Co., Inc. 214 Md. 251, 134 A. 2d 304 (1957); Myers v. Aragona, 21 Md. App. 45, 318 A. 2d 263 (1974).

"As ®judge!¡DáVi'dsón-notéd-'in Davis v. Frederick County Board of Commisioners; 25 Md. App. 68, 69, 334 A. 2d 165 (1975); Mr. Justice Cardozo declared in United States v. Memphis Cotton Oil Co., 288 U. S. 62, 67 (1933) that:

“A ‘cause of action’ may mean one thing for one 'purpose'® and •something’ different for-- another.;It - may-: mean-.one thing .when the .question- is whether) -it is good upon demurrer;- andsomethirig- different when there is a question of the amendment df k pleading or the application of the principle:of res : judical a.'’

Here we must determine what a “cause of action” is in the context of an amendment to a declaration. We note, at the outset, that in Crowe v. Houseworth, supra, where the Court of Appeals held that the addition of a new party plaintiff will survive a plea of limitations, Judge Singley stated:

“As regards amendment of the averments of a declaration, the Court has applied the doctrine of relation back with a considerable measure of liberality.” 272 Md. p. 487.

Later on, Judge Singley adopted the view of Mr) Justice Holmes speaking for the Supreme Court in New York Central & H.R.R. Co. v. Kinney, 260 U. S 340, 346 (1922), cited with approval in Doughty v. Prettyman, supra:

“. . . when a defendant has had notice from the beginning that the plaintiff sets up and is trying to enforce a claim against it because oj' specified conduct, the reasons for the statute of limitations do not exist, and we are of the opinion that a liberal rule should be applied.” (Emphasis added.)

In Maryland, Zier v. Chesapeake Beach R. Co., 98 Md. 35, 56 A. 385 (1903) remains the leading, case concerning the amendment — new - cause of action question. See, e.g., Brooks v. Childress, 198 Md. 1, 81 A. 2d 47 (1951); Stake v. Arundel Park Corp., 218 Md. 484, 147 A. 2d 427 (1959); and Myers v. Aragona, supra.

In Zier the widow of a railway fireman brought an action in negligence against his employer, ‘>he alleged that ihe negligence of either the defendant’s officials or its employees caused the fatal injuries sustained by her husband. In order to avoid a certain nonsuit, based on the fellow-servant rule, she amended one count of her declaration to charge defendant with negligence in selecting fellow employees of the decedent. Such amendment was made after the period of limitations had expired. The learned Chief Judge McSherry, writing for the Court, discussed in detail the rationale for permitting certain amendments even after the expiration of the statutorily prescribed period of limitations:

“ The institution of a suit arrests the running of the Statute of Limitations, and the general rule is that where the period of limitations has not elapsed before the suit was brought a mere amendment of the declaration, when the cause of action remains the same, will not warrant the filing of a plea of limitations even though the statutory period has intervened between the time when the cause of action accrued and the date of making the amendment. The reason for this rule is that the bringing of the suit stops the running of the statute and consequently so long as the suit proceeds for the same cause of action the bar of the statute cannot attach. When, however, by amendment the cause of action is changed, a new suit is begun when the amendment is made, and if between the accruing of that cause of action and the date of the amendment, which for the first time invokes that cause of action, the period of limitations has supervened, then the plea may be interposed to that new suit.” [Emphasis in original.] 98 Md. at 40-41.

He then proceeded to explain why the plaintiff’s amendment in Zier did not state a new cause of action:

“The fact that the narr was insufficient in law — that it did not accurately and formally set forth the real cause of action — did not prevent the suit itself from being a pending suit wherein the gravamen was the negligence of the defendant. When the amendment was made precisely the same cause of action was declared on. It is true it was imperfectly stated in the first count, but in the second it was correctly set forth. . .. [T]he suit to recover for the defendant’s negligence was precisely the same after the amendment had been made that it was antecedently. The statement of the cause of action was different but the cause of action itself was identical. Injury resulting in death is what occasioned the suit. The imperfect statement of the case did not cause the correct statement of it to be a different cause of action. Being the same cause of action the accurate statement of it in the amended declaration did not convert the original suit into a new and different suit; and therefore did not warrant the filing of any other plea of the Statute of Limitations than such as could have been interposed to the original narr.” [Emphasis in original.] 98 Md. at 42, 43.

We have quoted at such length because Judge McSherry’s language is so readily applicable to the instant case. Indeed, plaintiff here has, if anything, a stronger cause for his amendment than did Mrs. Zier, because Mr. Webber’s original declaration was not clearly insufficient in law. Md. Rule 301 e provides, in pertinent part, that “it shall not be necessary to state time or place in a pleading except where time or place forms a part of the cause of action or ground of defense.” The discussion in 2 Poe, Pleading and Practice (6th ed., 1970) § 556 is quite instructive. The only instances there mentioned where location is of the essence and therefore must be pleaded are actions in ejectment or dower. In the instant case the allegation in both the original and amended declarations was that Mack Trucks was liable in negligence for plaintiff’s injuries — such liability being predicated on the installation of a defective spring bracket cap on the truck he was driving. That Mack Trucks was aware of the essential nature of plaintiff’s eause of action was amply manifested by its early-.'pursuit- of a third-party- 'complaint- against Arrow Aluminum Castings Company, the manufacturer of the defective .part. Since-the location of an accident .is-not an element of the. tort of negligence, and since :Md. -Rule 301 c provides that .a pleading1 is'.sufficient: if it “contains-a clear statement of. .the'facts necessary-...to constitute ':a- .cause of action . . and since .the méglige-nce alleged :was in ho way changed, we' hold that the amended declaration here did not set Out a new cause of action and’therefore'was not barred by limitations.. The amended ¡declaration did no more than correct what-was an-unfortunate but not fatal mistake in the original. '••■■■- ■ • ¡ •

The dissenting opinion in this casé regards the appéarance of similárity. between the original and amended declarations as “superficial’-’ ' and' “in reality fallacious.” 'These characterizations are based upon the truism that “[t]wo causes of action which one person may have against another do not become the same because they arise from events which happen on' the same day. . . .” Such a proposition is relevant only if we assume that the first declaration was based upon the Cecil County brake failure rather than upon the Harford County spring bracket cap failure. That any such assumption is unfounded may be seen by including in the chronology of the case two significant events omitted in the dissent: '

. In h-is, answer to Mack Trucks’ interrogation Webber stated, on March 29, 1973, that- his claim that Mack Trucks -.was negligent was based on\the breaking of the spring ..bracket cap.-This response obviously caused Mack Trucks to implead the .manufacturer of the spring bracket cap on January 9,1974.

' When these events are • included in. the chronology. it becomes- clear - that Webber’s ; first .declaration; however inartful, was-based upon the Harford County spring-bracket cap accident and that-Mack-Trucks had notice thereof. We agree- with the dissent that the cause'of action which accrued as a-result of the morning accident was a “poor one.” We do not, however, see how -the complete chronology of. the case permits the inference, made in the dissent, that the “morning” cause of■■ action was’asserted’in'the original declaration. We find that the present case falls ’ squarely within' the ambit of Zief; skpra,'-in that “the suit itself [was] a pending'suit wherein the’gravamen was the negligence of the defendant^’' To" paraphrase-the language of Mr'. .'Justice Holmes Iñ'Kimiéy, supra', 'Maéü?Trucks' had notice'frOW the beginning that Webber’s claim agai'nst it:was because of its conduct with'-respect to the'installation of a faulty spring bracket:cap--ahd therefore the-reasons for the statute of '•limitations’do ndt exist. :’ •

Defendant-appellant .relies. ohs Cline v. Fountain Rock, supra, for an explication "of "Maryland law concerning whether1 ór not an amendment sets out a new cause’ of action. Such : 1 reliance ’ is appropriate.1 See, Crowe v. Houseworth, supra; Hall v. Barlow, 260 Md. 327, 334, 272 A. 2d 386 (1971); Eastern Air Lines, Inc. v. Phoenix Savings and Loan Assoc., Inc., 239 Md. 195, 201, 210 A. 2d 515 (1965); Glens Falls Insurance Co. v. Baltimore County, Maryland, 230 Md. 524, 528, 187 A. 2d 875 (1963). Careful scrutiny of Chief 'Judgé Brune’s scholarly opinion'ih Cline, however, -does-not bear out áppella’nt’s contentions thát the instant amendment set out a ne\v cause of action. In that case the originar1 declaration asserted "an oral’ lease but the amendment ;assérted the lease and an oral joint venture agreement and was-therefore' held to have set out a new causé of action-. The Court refused to apply the'doctrine of relation back. ( ’ ;

The rule in Cline may be, found in the penultimate paragraph of the opinion. It is, simply put, that if evidence which would support the amended declaration would support the original, i.e., if judgment for plaintiff on the amended declaration would bar suit on, the .original, the amendment does not set outa new cause of action and is not subject to successful attack by way of limitations.

Post-CZine cases holding that a -new cause of action was not alleged- in an amended declaration include State v. Arundel Park Corp., supra and Doughty v. Prettyman, supra, each of which was discussed by the Court of Appeals in Crowe v. Houseworth, supra, decided in September, 1974. In Arundel Park an amendment was necessary in order to proceed in a death action for negligence against an otherwise immune eleemosynary institution. The defendants filed special pleas asserting their immunity from liability in tort. Plaintiff responded with an amended declaration, alleging that the defendants were insured and estopped by statute from pleading charitable immunity. The Court of Appeals found no new cause of action and no bar of limitations since “the theory of the action has always been and still is based upon negligence ... and the only change is in the allegation which, in effect anticipates a defense raised by the pleas of immunity.. . .” 218 Md. at 489. Again, in the instant case, the theory of the action has continuously been Mack Trucks' negligence. Plaintiffs amended declaration in no way changed this. The specific allegations of negligence were identical in each pleading.

Doughty, decided hi 1959, the same year as Arundel Park, was a negligence case in which the Virginia guest statute, then § 8-646.1 of the 1950 Code of Virginia, applied and required proof of gross negligence to permit'guest motor vehicle passengers to recover. The original declaration alleged negligence and the pertinent amendment alleged gross negligence with respect to a guest passenger. The Court of Appeals cited, inter alia, Arundel Park and Brooks v. Childress, supra, and distinguished Cline in its determination that the original and amended causes of action were essentially the same and that no plea of limitations could successfully be interposed. With respect to Cline, the Court stated:

“In the Cline case, the causes of action set up in the declaration and in the amended declaration were essentially different; as the Court pointed out, it could not be said that the evidence which would support the one would support the other or that a judgment in favor of Cline on one would preclude his suit on the other. See Comment in 18 Md. L. Rev. 161. In the present case, however, the alternative eauses of action set up in the two counts of the original declaration and in the third amended declaration are essentially the same. Evidence of the negligence of Johnson, the driver of the truck, would have supported the first count in its original or its amended form, and evidence that the truck was defective and that the appellee’s decedent knew or should have known of the defect would have supported the second count and all its variations.” 219 Md. at 91-92. (Emphasis added.)

Appellant also relies upon the case of Talbott v. Gegenheimer, 237 Md. 62, 205 A. 2d 285 (1964) which held that relation back will not be permitted when a new defendant is added. There, a passenger sued both drivers. After the lapse of three years, an amended declaration was filed wherein the identity of one of the drivers was changed — a wife was named as driver and her husband (one of the original defendants) was alleged to be the owner. A motion for summary judgment was granted as to the wife. The Court held that the motion was properly granted. Chief Judge Henderson, writing for the Court and without adverting to Cline, supra, pointed out that this was not a case of mere misnomer, citing Western Union v. State, 82 Md. 293, 33 A. 763 (1896), nor a change in the theory of liability against the same party, citing Doughty, Brooks and Zier, supra:

“. . . Mrs. Gegenheimer is obviously an entirely new party, who was not charged with liability on any theory in the first declaration. We think her plea of limitations is therefore good.” 237 Md. 63, 64.

We consider Talbott entirely inapposite, on its facts, to the instant case. We find that the amended declaration was not barred by limitations.

DENIAL .QFl APPELLANT’S, SECOND.. MOTION, , ", . 1 .FOR A; NEW; TRIAL. . V.V.. .'/•

It is>-funda-mentarth’at'tH'é';gránt';or'ref-usal‘df.a'new trial is within ¡ tHe: sounddiSGreti6ii'< of the ’trial eou'rfc • an'ch is’ not reversible1 ob appfeal;--af least1"when -the tri-aLcPu-rt fairly-exercised its- disbretióii," áhdyexc'épF-fcr5 -the • Most-'CG'mpelling reason'sh’Furtherffl'Ofei^.wKen’ thé'' motion ’ iá made '1 on- the grounds.'of '-newly-di’scofere2d'' évidénce,- that evidence -must not have been “previdüsliyrdísébvferáble' by due diligence.” Washington, Baltimore & Annapolis R. Co. v. Kimmey, 141 Md. 243, 118 A. 648 (1922); The Maryland Coal & Realty Company v. Eckhart , 25 Md. App. 605, 337 A. 2d 150 (1975); Angell v. Just, 22 Md. App. 43, 321 A. 2d 830 (1974).

, , M,ack.^fI^r,u,cLs:Tiled;:alI^Q-t¿ón.,f'or. a :néw[,^ria^L,within -the three:Mny,]aeriod .provided ;in. Rulé 567: The motjon- was-heard; in;.open: court,qn’K,ebruaryt25;. 1975. and-w.as denied;' On .the same date judgment absolute;...yy-aq enteredm.favpr-pf-Mr;. Webber- and, the; State .Accident.Fund: against Mack Trucks» I-nc.. in the, amount; of, $380,000. ,

.■0.niMareh-19; d;9.75 a second m.otion;,for;-a'new trial -was filed-.. This motion¡wasi foa'sédiüpon aUegedmevylydiscoveredevidence pursuant' to -Maryland -Rule- 625.-b,> which, -provides as follows: • • - n-\. -• ,- ; .>

-'"“b.'NelólyDiscoJéredEvidence:

The court may, pursuant to a motion filed within the, time set forth in section a of this Rule, grant a .new trial or other appropriate relief on the ground of newly discovered evidence .which by due diligence could not have been, discovered in time to move for a new trial -under section a of Rule 567 (New Trial).” .

The motion claimed that in answers to interrogatories, in deposition, and at the trial of the case, Mr. Webber testified that he was (1) unable to engage in any but occasional light physical activity and (2) that except for unsuccessful efforts at light work, he' had not been employed 'since1 the accident on’February 26, 1970. The motion further represented to the1 court that “as a result of an anonymous call following the trial of- the case” appellant had come into possession of newly discovered evidence to show (a) that appellee was employed1 at H & H Auto Sales for a period of almost’a year from November 1973 to September 1974; and (b) that appellee had also been employed as a -vending machine repairman “for a period of a couple of months” for the Complete Coin Vending Corporation of Chesapeake, Maryland. Attached to the motion were affidavits of Bonny Ann Jackson, age 19, of Elkton, Maryland, who had dated Mr. Webber from November 1973 until February 1974; Sara Lee' Frederick,'age 26, a cousin of Bonny Ann Jackson, and a waitress'at Rose’s Diner, Route 40, Elkton; and Nellie Lee Meadows, age 51, of Elkton, Maryland, a former waitress at, Rose’s Diner. . :

A hearing on the motion was held on March 27, 1975 when the court Heard ten witnesses. The appellant called the three affiants and the presidents1 of each of the companies "by which appellee had allegedly been employed. The appellee’s witnesses, in addition to Webber himself, included a claims supervisor for Travelers Insurance Company who had been responsible for investigating Mr. Webber’s claim, and a private investigator whose firm had been engaged on behalf of appellant on or about February 1, 1975, after receipt of the anonymous telephone call. The number of pages of transcript exceeded that of the trial itself.

The charge with respect to alleged employment by the Complete Coin Vending Corporation of Chesapeake, Maryland was withdrawn when the testimony at the hearing on the motion developed only tha± the company rented appellee’s pickup truck for a short period of time for $50 per week' ending in November 1974 and that he had merely been seen at Rose’s Diner in the presence of vending machine company employees.

With respect to H & H Auto Sales the testimony of Fred Harry Letner, Sr., president of the organization, disclosed that it was a used car business and did very little mechanical work. During a 16-month period ending in April 1974, Mr. Webber, and on occasion Mrs. Webber, accompanied Mr. Letner to used car auctions at Felton, Delaware, Bordentown, New Jersey, Bel Air, Maryland, and Manheim, Pennsylvania on Tuesdays, Wednesdays, Thursdays and Fridays, respectively. They would drive passenger cars to or from these auctions. The compensation which Mr. Webber, and on occasion Mrs. Webber, received was $5 per trip. Letner testified that appellee was not an employee but rather, “contract labor.” The court found that the average compensation per month to Mr. Webber over the 16-month period was only $80. Mr. Webber testified that he had to stop this activity: “Because it was too hard on me. It was just too much to have to drive all of that ways now, for $5 and it was just too much on my back and legs and stuff. So that is really why I stopped. It was just too much on me.”

During the course of the hearing on the motion, Judge Mackey summoned the court reporter, Kathleen W. Martenis, and asked her to read, from her notes of the trial, Mr. Webber’s testimony concerning any employment after the accident. At the trial he first testified that upon the advice of one of his doctors he attempted to resume work as a truck driver but collapsed in the effort; and that he had pumped gas at a service station for about three weeks and had to give that up. He was then asked on direct examination whether he had tried any other job:

“Q. Now, have you tried any other job?
A. Yes, I tried working at a car lot.
Q. Doing what?
A. Car salesman, handyman, go to sales and drive cars back and forth and stuff like that and it just, I just can’t do it, because when you’re in pain you can’t perform to your fullest ability and the man’s not going to hire, he’s not going to hire me. And I only worked a couple days a week. He ain’t going to do that.” (Emphasis added.)
Q. Were you on commission there at the used car lot?
A. Yeah, $25.00 a car is what I got.
Q. Well, can you tell the Jury, were you able to make anything there?
A. Yeah, I made about $50.00 a week. I managed to sell a couple cars. Not $50.00 every week. Some weeks I didn’t take home nothing.”

Cross-examination of Mr. Webber on this subject was confined to testimony given by him in a deposition taken on May 30,1974:

“Q. And you indicated also when we asked you about what you did with your time, you said sometimes you drive up to one of the filling stations and sit around and talk to your friends up there?
A. Yes, and the car lot. I was going up once in a while and going with them to the car sales.
Q. But you do drive the car and you have all along?
A. Oh, yes.” (Emphasis supplied.)

At the hearing on the second motion for a new trial Mr. Webber was again cross-examined on the basis of his deposition. Thus, counsel for Mack Trucks, Inc. stated:

“Q. ... I am going to read the deposition and ask you whether I asked you these questions and answers as given in May of 74.
‘And how longD-i— line-4 ‘How. long-did‘you work at the car lot? A. Couple of weeks. And’then wha,t” What was,.tiie;riext time;? Answer: I haven’t worked. -.Question;’- Ha-sn’f bepn,v,.a -.next: Answqr:,: No.; Question;-,-You tell--;me.-since accident, ftedyme,;if;Lam wrong, yo.u .went back to work aft'qr the first;.o.peration, ,1,. 2-}/z,days,: and then,another time, you,-worked for abóut t-wo-wejeks, on a car lot? Answpn.Abopt.g or ,3; weeks, yes, that is .it. You haven't worked for. anybody else since this accident? Answer:' No. Yes, sir/Is that-correct? Answer: That is right’. • .
Did - -the stenographer accurately record ’ the questions arid 'answers I háve just read when you came to my office on May of ’74? Those aré the' ansv/érsyou'gav’e?- •=■ »¡ c '■ • .•■-■
A: Yés/sir/
Q. Is that correct?
-'A.'Yes, sir.”

In his oral opinion from the bench on the* day !bf the hearing on the motion for a new trial Judge Mackey found with respect to'Mr. Webber’s trial testimony: ' " ,

,[H]e..stated, he,worked, .two,.days,, a week and that'he.made $25 a trip or $50-a wepk¡ Thi^. was not. so every, week,, but it would probably, be, a fair average, as, T understood .the testimony. /The Plaintiff at £Ke. trial before the Jury, did not pyi any limit on the number of weeks' that he worked, nor the time that he worked. And he significantly, ' so far as we are ablé''tó"ascertain from our collective recall and the stenographer looking at the notes, he was not 'crossed oh this point.” (Emphasis plied.') • ‘ ' "’/'/'■''

It is apparent that when appellee was deposed his testimony-was somewhát cryptic in'describing his activities with ■ H'& H Auto-Sale's."’Wé reject; as in effect did the trial court, appellant’s hyperbolic charge in its brief that his was “th'e'ñtóát blatant 'perjured testimony'that the ipind of man could inveht.” It is, in' any event, his testimony at trial that really counted and we quite agree with .Judge' Mackey’s statement above quoted that at trial Mr.' Webber was “significantly” not cross:examined. In this respect we find qdite cogent the following analysis by the trial court in his opinion after the hearing on the motion:

“The question, it seems to the Gqurt, is first of all whether due- diligence was exercised and, if it were, could this matter of his earnings of some- $80 a month over a 16 month period have been discovered. It seems to the Court that in .light o.f the testimony of the Plaintiff at the trial, if it were not discoverable before, that a cross examination would have elicited answers as to the length of time that he worked, and had those answers proven false, the Movant then might have á different standingbefore the Court today on its Motion for New Trial. This cross examination was not conducted. The answers were not elicited, and it can not be said that the fact-finder was misled by the testimony of the Plaintiff, that he worked 2 days a week, making $25 to $50 a week. He simply did not say how long he worked. He did say that the time came that he had to quit and it does seem to the Court that it was up to the Defense Counsel to develop the length of time that he worked, if he is going to have standing here today to contend that with due diligence he could not have discovered this fact. It is futile to.try to speculate what the Plaintiff’s answer would have been had he been asked these questions.
The Court, therefore, concludes that the Jury was not misled and that the ingredients were there for a total revelation to the Jury, had the Defendant chosen to avail himself of his opportunity.”

We observe also that the trial court’s opinion finds as a fact “that no investigation was made of this case until November, 1974 or some 60 days before trial. ... It was November, 1974 that the insurer undertook an investigation other than the perfunctory examination of the police report and reading of the suit papers.” (The declaration was filed on January 22,1973.)

This finding is fully supported in the testimony adduced by appellee at the hearing on the motion. Richard Bannister, the Travelers Insurance Company’s claim supervisor, ultimately conceded that “we did not check with the employers prior to the verdict” and that after the verdict the insurance company employed Interstate Bureau of Investigation, a private investigating firm, to do so. Earlier, Bannister testified that during the period prior to the ruling by the court that the statute of limitations could- not be interposed,

“Well, now we went through the basic gathering of all the special damages and everything else to find out exactly what we were faced with, and then as far as a further investigation and as for an actual field work, there really was no field work until November of — approximately November of ’74.”'

Mr. Bannister’s testimony also revealed that in ■November, 1974 the company had employed a different investigating organization, the Wackenhut Corporation. The following colloquy ensued:

“Q. Now, did you give him any instructions as to what he was supposed to do?
A. We just wanted to make sure that Mr. Webber wasn’t working because we had, in May of '74, went into the deposition — I forget exactly when I received the deposition — but I received Mr. Lerch’s report of the deposition. But the deposition was in May and sometime shortly thereafter we learned that he, Mr. Webber, wasn’t working. This case was, as you know, a very complicated case with a lot of other ramifications in it in addition to the injuries that are alleged. We thought that it would be a good idea, we thought, to see if Mr. Webber was telling us the truth. We had no reason to doubt him.
Q. All right. Wait a minute. You had Answers to Interrogatories and you had his deposition. But you had already had that in the file. You had his deposition testimony and his Answers to Interrogatories?
A. With no reason to believe that he wasn’t telling us the truth.
Q. With no reason to believe that he wasn’t telling you the truth, so why did you do an investigation?
A. Because of the extent of the claim.
Q. You wanted to be sure what he was telling you was the truth. Right?
A. Yes.
Q. And it was good claim procedure not to rely on what a plaintiff tells you, but to go out and check out the bona fideness of what he said?
A. I would have to say that is probably correet.
Q. And in the course of your duties as a supervisor and your training, you certainly are instructed, are you not, that in any kind of a substantial case you always verify claimed loss of employment or claimed injuries?
A. Yes.”

Based upon this record, the ultimate conclusion of the trial court was that due diligence had not been exercised either prior to trial or during the trial itself and that the motion for a new trial must fail. We find no error in this conclusion nor can we accede to the importunities of appellant that the decided cases of the Court of Appeals and of this Court, including Angell v. Just, supra, compel a contrary result.

Furthermore1,■' another; Constituent; element ore the ¡question of newly pr-'áfter 'dlsc'ovéfredi eyjderice.-isithat-ifcmust-.b.e' such, and of such nature that, on a new trial, the n'ewly-'disetívered evidence ¡-would ¡produce .a¡different result./ Angell v. Just, supra, 22 Md. App. (g-b p. Hpre,'¡the.,tria,Lepurt;was not persuadéd;that; the, “Movánt. [appellantl.hasuhó'wnithat the Plaintiff-['appellee] is-changeable, with.any misleading1'of the fact finder to the extent that the verdict; would': have been other.than that,;r¡enper.ed.;pr.:that the amount,.of damages would Have been other than that found by the jury/’.There is substantial support fpr this conclusion. ’ ! ’/■/' 't

The jury Ipnew thát. plaintiff was, capable of driving a car and that' he had gone to the car' auctions.'in/.Maryland, Pennsylvania, Delaware, ^nd, ,N.ew. Mersey. ‘‘¡there was testimony by plaintiff' on direct examination "that he had made'as'mucli ás $h(tpef week;ori':occasion ifrbhe'used car business. Dr. Reahl, Mack Trueká’ 'examining orthopedic surgeon, said in his report, “I don’t think he’s capable of doing' heayy'-work-. or being-'a.-. truck'driver but-I-;'do‘think he should bei/able :tp béi rehabilitated; to'some form of, light work.” Dr. Dippman; ap.pellefe’S'physician,--,characterized Dr. Reahl’s report as “optimistic.” In any event the jury returned its verdict with the awareness that the permanently injured ¡plaintiff- had the capacity to earn some limited income.- v..;- ,. '-. ;

We cohcludé'thát the tri,ahcdurt’s findings on the evidence were n'ot -“clearly, erroneous,”-¡Md;.Rule -. 1086, and. that the denial of-app'ellarit’s-.motion.fpr a new trial was'notrah-abuse of discretion. ■ •. i;; m a , \

Judgment affirmed; ''costs to be ¡; paid by.appellant. : ■■■ - . . //

'Powers,'J'.',

dissenting:

■' The majority opinion rules .on two/issues- I. concur with ■the-h'oldihg;that the-trial judge;did'not abusé'his-d-iscre.tion in denying the-1 second motion for-a mew -trial,' which >Mapk '-filed under Maryland.Rulé:-625 b claiming neWly;discovered evidence. But I must dissent from the holding that the amended declaration did not state a new cause of action, but merely restated the same cause of action, declared upon in the original declaration.

Obviously, the significance of the,issue is that if the amended declaration stated the same cause of action, as the original, it related back to the time the original declaration was filed, and was not barred by the statute of .limitations, if the cause of action sued on in the amended declaration was not the same,' it was filed too laté, and was barred by limitations.

The chronology of this case, as shown by parts of the record which I consider relevant to the issue, is this:

22 January 197b Declaration filed by Lawrence Delbert Webber and State Accident Fund, ' as plaintiffs, against Mack Trucks, Inc. and, William Ross Shire, Sr.,'as defendants.
15 March 1973' — Responsive pleadings filed by Mack.
26 June 1974 — Motion for summary judgment filed by Mack on the ground that there, was no genuine dispute that, the accident sued on was not the responsibility of Mack and that, in any event, the plaintiff ,wras not injured or damaged in the accident. The motion relied upon facts developed in Webber’s deposition taken on 30 May 1974.
11 July 1974 — Answer by the plaintiffs to. Mack’s motion for summary judgment. In , the answer it was asserted that Webber wTas injured on 26 February 1970 as a result of defendant’s negligence, but that the injury occurred at a different place from that alleged in the declaration. The.answer went on to say that the allegation in the .declaration stating where the injury occurred wras made inadvertently, and that plaintiffs intended, to move for leave to amend the declaration.
19 August 1974 — Hearing on Mack’s motion, for summary judgment. Plaintiffs’ oral motion for leave to file an amended declaration was granted,' and the motion for summary judgment was denied.
3 September 1974 — Amended declaration filed. Plaintiffs were the same as in the original declaration. Mack Trucks, Inc. was the only defendant.
9 September 1974 — Responsive pleadings, including a plea of limitations, filed by Mack.
9 October 1974 — “Memorandum in Support of Plaintiffs’ Amended Declaration” filed.
23 October 1974. — “Reply Memorandum” filed.
15 November 1974 — Docket entry, “Hearing” *'* * “Plea of Limitation denied”.
5 December 1974 — “Opinion In Support Of Denial Of Plea Of Limitations” filed.

The hearing presumably was confined to argument of counsel, since there is no transcript of it. In counsel’s memoranda and the court’s ruling it appears that by common acquiescence the court proceeded as on a motion for a partial summary judgment, on the issue of limitations. The issue, submitted to the court' upon the entire record, involved no dispute of fact, but turned solely on whether the cause of action sued upon in the amended declaration was the same cause of action sued upon in the original declaration.

Whether the amendment stated the same cause of action or a new cause of action is irrelevant to the right to amend. The trial court properly permitted the amendment. The leave to amend in no way involved a decision by the court whether the amended declaration merely restated the same cause of action originally sued upon or whether it stated a new cause of action. But for the intervening expiration of the period of limitations, the question would be of no significance. Once the amended declaration was filed, more than 4 V2 years after the cause or causes of action arose, the plea of limitations to the amended declaration raised the question.

Facts in the record show that Webber was employed as a truck driver, and on 26 February 1970 he was driving a tractor-trailer owned by his employer. The tractor was a 1965 model manufactured by Mack Trucks, Inc. On that day, Webber was involved in two entirely separate and unrelated accidents.

The first accident happened at 8:55 A.M. Webber was driving south on State Route 272, at its intersection with U.S. Route 40, near North East, in Cecil County. The main air line on the trailer broke, and the braking system failed. The tractor collided with a passenger automobile in the intersection. The police report recorded no personal injury, no damage to the tractor, and minor damage to the passenger car. The broken air line was soon repaired, and Webber went about his work.

The second accident happened at 3:43 P.M. Webber was driving north on Interstate Route 95 in Harford County. A spring bracket cap on the right rear tandem of the tractor broke in half, causing the rear axle to shift and the tractor to go out of control and overturn. No other vehicle was involved. Webber was seriously injured.

Each of these two accidents involved facts upon which a cause of action might be asserted by one claiming to have been injured or damaged as a proximate result of a breach of duty or breach of warranty by one or more parties named as defendants. How good a cause of action either may be, how sufficiently or deficiently it may be pleaded, how well it can be supported by proof and succeed at trial, are matters of no moment. I think we may properly concern ourselves with only one question, “What was the cause of action upon which the suit was brought?” We may not properly concern ourselves with what cause of action the plaintiff should have brought, or intended to bring.

The declaration timely filed on 22 January 1973 named Webber and the State Accident Fund as plaintiffs. Defendants were Mack Trucks, Inc. and William Ross Shire, Sr. The declaration contained five counts. In the first three counts Webber claimed against Mack Trucks, Inc. The first was based on negligence, the second on breach of warranty, and' the third- on''strict liability. ’In the fourth - count he claimed against Shire,'alleging that Shite was negligent. In. the. fifth'couñt''the Stát'é. Accident Fund'adopted .'all-of the; allegations '•■•of ;the • first- four: counts '-and claimed1' its subrogated interest under the Workmen’s Compensation1' law.- The second, third, .and fourth; counts, adopted, by reference the allegations -of the-first-count .The-factual' allegations there: with which we-áre concerned wore; . A '

* -* * that- on or about’, February 26, _ 1970, near Nqrth East, .Cecil County, Maryland, ■. at - the . .intersection of U. ,S. Route 40 and’Marylápd State - Route'272, the Plaintiff was lawfully, carefully and "prudently operating, in a southerly direction on; said.Maryland, State Route 272, a traqtor’anddump trailer, owned, by his employer, Trego1 Bros., Inc., when suddenly and without, warning a mechanical .or! structural defect or failure ;oh the aforesaid tractor caused the .Plaintiff to losé control'óf the aforesaid tractor and dump trailer; and 'as a direct result the Plaintiff was involved in an accident with ano'thér vehicle opefatéd by William Ross Shire;'Sr'., in'which--accident thé Plaintiff was injured and'damaged”’- ’■ '

In :the amended,declaration the. plaintiffs wére the-sam'e.’, Máck Trucks, Inc. was the only defendant.'There were folk counts: In the first'three Webber- claimed-against; Mack on1 negligence, breach of warranty;.-,andi-'stri.ct liability. In the fourth, -the- State -Accident'- Fund ! asserted -its.'-right - as. subrogee. All- subsequent'counts'adopted by reference theallegátions'of the-first Count. The factual- allegations, there with which we are concerned were:: -, ;

:.‘‘that on or about February' 26,. 1970, op, interstate Highway I 9.5, jin Harford Coupty, .Maryland,.,the Plaiptiff .was lawfully, carefully 'and, prudently'; operating; in a northerly ‘ direction ’ op said Interstate .1,95, a.tractor and",dump trailer, owned by his employer, Trego Bros., Inc!, when suddenly and without warning a mechanical or structural defect or failure On the aforesaid tractor caused the Plaintiff to lose control of the aforesaid tractor and dump trailer; and as a direct result the Plaintiff was involved in an accident, in which accident the Plaintiff was injured and damaged.”

. The parallel allegations in the original declaration and in the amendment do indeed make it appear that they are saying almost the same thing — that they are alleging the same cause of action, differing only in describing correctly, rather than erroneously, the geographic location where the cause of action arose,, and in- abandoning the claim against one of the original codefendants. , ,

That appearance of sameness is, to me, superficial only. It is in reality fallacious, and may well have led the trial judge and my colleagues into error. Two causes of action which one person may have against another do not become the same because they arise from events which happen on the same day, any more than if they happened the next day, the next month, or the next year. Conversely, when there is one and only one cause of action, it does not become different because of a misstatement of the time or place, or even the legal theory upon which liability is based. Corrective amendments of such misstatements relate to the time of the original filing, imperfect as it may be, of the only existing cause of action.

With some fear of oversimplification, I say that when there is but one cause of action, it cannot become -two, and when there are two causes of action, they cannot become one.

The cause of action which arose in Webber from the 8:55 A.M. accident in Cecil County, a poor one to be sure, nevertheless became a matured and existing cause of action when that accident happened. The fact upon which Mack’s liability necessarily had to be based was the failure of an air line in the brake system, regardless of the vagueness with which the failure was alleged when that cause of action was asserted in the original declaration.

The second cause of action, which arose from the 3:43 P.M. accident in Harford .County, was totally unrelated to the first. It arose when a defective spring bracket-cap failed, and caused the tractor to go out of control. Regardless of how long the danger from the defective part remained potential, no cause of action arose until the defective part in fact failed, and Webber was injured as a result of that failure.

Regardless of the similarities in the words used, it is clear to me that the cause of action sued upon in the amended declaration was entirely different from and in no way, factually or legally similar to the cause of action alleged in the original declaration. The authorities cited and quoted in support of the conclusion reached in the majority opinion merely confirm me in that view. All that Chief Judge McSherry said in Zier v. Chesapeake Beach R. Co., 98 Md. 35, 56 A. 385 (1903) was premised upon the cause of action being the same, but he pointed out, at 40-41:

“When, however, by amendment the cause of action is changed, a new suit is begun when the amendment is made, and if between the accruing of that cause of action and the date of the amendment, which for the first time invokes that cause of action, the period of limitations has supervened, then -the plea may be interposed to that new suit.”

That is precisely what I think happened in the case before us.

The substance of Zier and the other authorities cited is summed up by the Court of Appeals in Crowe v. Houseworth, 272 Md. 481, 325 A. 2d 592 (1974), where it said, at 485-86:

“The modern view seems to be that so long as the operative factual situation remains essentially the same, no new cause of action is stated by a declaration framed on a new theory or invoking different legal principles.”

I see no alternative but to reverse the judgment appealed from.

      . The State Accident Fund was also a party plaintiff, and is an appellant here, to recover benefits paid to Mr. Webber pursuant to the Workmen’s Compensation Laws of Maryland.

      . It was stipulated at the outset of the trial that the admission of ■■negligence would, npt constitute a waiver of .appellant’s right to assert on appeal its defense o'f limitations.'

      . In -op.e.i)ing -statement, counsel, for Mack Trucks .stated that'-."‘the ¡evidence.,will show;.that this is not.a nothing case;.it’s-a'sferipuS easel” He said that appellee “was seriously, injured” and also tojd the jury their, award “will be a substantial amount.”

      . A demurrer to the strict liability count was sustained without leave to amend.

      . It was also stated that at the initial interview by counsel with Mr. Webber after the accident, his recollection of the facts was “foggy and vague” and that a motor vehicle accident report thereafter requested by counsel stated that the accident occurred at the intersection of U.S. Route 40 and Maryland Route 272.

      . A demurrer to a strict liability count was again sustained without leave to amend.

      . On the day of trial the court granted a motion by Mack Trucks filed on January 7, 1975 to dismiss its third-party claim against Arrow Aluminum Castings Gompany.

      . Under then existing law in Maryland, a servant who was injured by the negligence of a fellow-servant had no right of action against the common master “unless the latter had been guilty himself of negligence in selecting an incompetent fellow-servant who by his carelessness caused the injury; or in retaining him in service after his incompetency became known or ought to have been known by the master.” Id. at p. 39.

      . Recent cases from other jurisdictions reflect determinations consistent with Maryland law and with our holding here: Material Handling Industries, Inc. v. Eaton Corp., 391 F. Supp. 977 (E.D. Va. 1975) (originally: attack-on validity of. territorial, restrictions ; and tying-.agreement; as amended:'conspiracy in. violation of the Sherman Act, 15 U.S,C.'§ 1; Pendrell v. Chatham College, 386 F. Supp. 341 (D. Pa. 1974) (briginally: wrongful discharge;; as amenáedi'defamatiqn.-and-.tf-esgassfo In re Poulous Estate, 229 N.W.2d 721 (Iowa, 1975) '(originállyfwill attacked on grounds of undue,influence and. lack, of testamentary capacity;,,as amended: will forged); Price v. J. C. Penney Co., 216 S.E.2d 154 (N.C. App. 1975) (Originally: -wrongful discharge; as amended: slander). In all of these’ cases: the change brought about by the amendment substantially changed the-, cause of action. In none of them could it be said that eVidéiice in support of the amended declaration would necessarily support the original suit. In the instant case the evidence concerning defendant’s negligence would have been .the same under either declaration. ,(No .evidence was, adduced- since defendant admitte.d liability.).. ... , , . , •

      . .The appeal in. this.case was-taken from..the judgment-entered- on-February 25, Í975 and from the denial of the motion for a new trial.