author: Lxss, J.,

text:
    PRINCE GEORGE’S COUNTY, MARYLAND et al. v. THE EQUITABLE TRUST COMPANY, INC.
    [No. 193,
    September Term, 1979.]

      Decided December 6, 1979.

    The cause was argued before Moore, Lowe and Liss, JJ.

      Steven M. Gilbert, Associate County Attorney for Prince George’s County, with whom were Robert B. Ostrom, County Attorney, and Michael O. Connaughton, Deputy County Attorney, on the brief, for appellants.

      Robert A. Manzi, with whom was Russell W. Shipley on the brief, for appellee.
   Lxss, J.,

delivered the opinion of the Court.

This is an appeal from a final order reversing a decision to downzone appellee’s property made by the County Council of Prince George’s County, Maryland, sitting as the District Council for that part of the Maryland-Washington Regional District in Prince George’s County.

On May 2,1978, by Council Resolution 40-1978, the District Council adopted a Sectional Map Amendment for Planning Area 81A in the County. By this action, 12 acres of land owned by appellee, Equitable Trust Company, were downzoned from the C-l (Local Commercial, Existing) zone to the R-80 (Single Family, Detached Residential) zone. Appellee filed an administrative appeal to the Circuit Court for Prince George’s County, and by an order entered January 30, 1979, that court reversed the District Council’s action as it affected appellee’s land, finding that the District Council had no power to downzone such property.

The Council and Prince George’s County, the respondents below, are the. appellants herein, and Equitable Trust Company, Inc. is the appellee. In September 1974, the County Council of Prince George’s County, Maryland, sitting as the District Council for the Maryland-Washington Regional District in Prince George’s County, passed Council Resolution 93-1974, which directed the Maryland-National Capital Park and Planning Commission (the Commission) to prepare a proposed Sectional Map Amendment (SMA) for Planning Area 81A, known as Clinton-Tanglewood. This planning area, covering over 9500 acres, includes the properties which are the subject of this case — two lots totalling approximately 12 acres at the northwest corner of Chris-Mar Avenue and Old Branch Avenue in Clinton, Maryland.

The Equitable properties, acquired by it in 1977, had been zoned C-l (Local Commercial, Existing) for many years prior to 1974. In 1977, during the final stages of the SMA process before the Planning Board, Equitable’s 12 acres were subdivided into two lots. The smaller lot of approximately 0.8 acres fronting on Old Branch Avenue and a short distance north of the intersection with Chris-Mar Avenue was subdivided from the remainder of the land owned by Equitable for the purpose of instituting commercial retail development permissible under the C-l zoning in effect at that time. The remaining lot of 11.2 acres was not developed for commercial use at any time before the Clinton-Tanglewood SMA was finally approved and is still mostly vacant and unimproved. Located on this lot are several residential and incidental structures none of which were used for commercial purposes.

During the SMA process before the District Council, Equitable was able to begin commercial development on the 0.8 acre lot on Old Branch Avenue. Early in 1978, Equitable entered into a contract to sell this property to A&R Builders, Inc. which is not a party in this case. On March 10,1978, after there had been initial hearings on the Clinton-Tanglewood SMA before the District Council, Equitable and A&R applied for a building permit for a commercial structure on the 0.8 acre property. The permit was issued on April 26 after the final Council public hearing, and A&R was able to pour footings and partially construct the walls of its commercial building before May 2, the date of final SMA approval. There is some indication that the District Council was aware of Equitable’s development activities at the time of the final SMA approval.

The chronology of the final stages of the Clinton-Tanglewood SMA process dates back to July, 1977, when the Planning Commission released a proposed SMA for public inspection. This “Public Release” designated the Equitable properties as Change M5 and recommended that they be rezoned from C-l to R-80 (One-Family Detached, Residential). On September 28,1977, the SMA as proposed in the “Public Release” was reviewed in public hearing before the Planning Board. At this hearing, Equitable’s representative acknowledged to the Board that the properties were in a residential area. The Planning Board’s final SMA proposal was transmitted to the District Council on November 29, 1977. In the final transmitted document, called the “Technical Summary”, the subject properties in Change M5 were recommended for rezoning from C-l to R-80.

Public hearings before the District Council on the proposed SMA were held on February 28, March 1, and April 12, 1978. After the second hearing, Council Resolution 33-1978 was passed, in which the Equitable properties were proposed for rezoning from C-l to C-A (Ancillary Commercial), R-T (Townhouse), and C-S-C (Commercial Shopping Center). These changes from the Planning Board’s proposal, given in Amendments 38, 38-A, and 39 of CR-33-1978, were supported by Equitable’s representatives. At the public hearing held on April 12, 1978, several residents of the area near the Equitable properties objected to the proposed amendments, and after the hearing, the Council reinstated the R-80 zoning the Planning Commission had recommended. And finally, on May 2, 1978, the Council, by Resolution CR-40-1978, adopted the final Clinton-Tanglewood SMA by which both the 0.8 acre parcel on which there had been partial commercial development and the remaining 11.2 acres were downzoned to R-80.

While the proceedings we have heretofore noted were occurring, Equitable and A&R Builders, on March 10, 1978, applied for a building permit/use and occupancy permit to construct a retail commercial structure on the 0.8 acre lot. That portion of the total ownership of Equitable had been subdivided with a final record plat being approved on April 21, 1978.

On April 26, 1978, Prince George’s County issued a combination building permit/use and occupancy permit to Equitable and A&R Builders. Footings were poured on April 26 and 27. Inspection and approval followed on April 27. By May 2, the date of the adoption of the Clinton-Tanglewood SMA, not only had footings and foundations been constructed, but walls were at least partially erected. On May 2, 1978, the Prince George’s Department of Licenses and Permits revoked the building permit for an alleged violation of the underground utility notice requirement. An appeal of this action was noted to the County Board of Administrative Appeals which, on May 12, 1978, found that the action of the Department of Licenses was improper and ordered reinstatement of the permit. The appellants appealed to the Circuit Court for Prince George’s County which affirmed the Board’s decision on June 16, 1978. In the interim, Equitable had timely noted an appeal from the Council’s action adopting CR-40-1978. After a hearing and argument, the trial judge ruled that the downzoning of Equitable’s 12 acres of property by CR-40-1978 was invalid. It is from the order issued by the trial judge reaching this conclusion that this appeal was filed.

Appellants raise two issues to be decided by this appeal. They are:

I. Whether it was error for the lower court to equate the words “developed and utilized for the zoning applicable thereto” in the zoning ordinance with the “vested rights” concept from Maryland zoning cases?
II. Even if Equitable’s partially-developed lot of 0.8 acres was protected from SMA rezoning by the zoning ordinance, were the remaining 11.2 acres also protected?

Appellee contends that before the adoption of the Sectional Map Amendment pursuant to Council Resolution 40-1978 by the District Council that it (Equitable) obtained a building permit and initiated substantial construction on the 0.8 acre portion of its 12 acre lot. Appellee asserts that it was protected from the downzoning action of the District Council which affected the appellee’s total acreage by the pertinent provisions of the Prince George’s County Code, Sec. 27-574.2 (b) which provides as follows: “Property that is developed and utilized for the zoning applicable thereto, and property zoned within five (5) years prior to the institution of the Sectional Map Amendment shall not be downzoned.”

Appellee urges that its partial construction of a commercial building on the 0.8 acre parcel had the effect of preventing the rezoning of the 0.8 acre property from commercial to residential and had the umbrella effect of also preventing the rezoning of the remainder of the entire tract.

The Sectional Map Amendment process in Prince George’s County was adopted in order to provide a method to accomplish comprehensive rezoning of large planning areas. See Montgomery County v. Woodward & Lothrop, Inc., 280 Md. 686, 376 A.2d 483, cert. denied, 434 U.S. 1067 (1978); County Council v. District Land Corp., 274 Md. 691, 337 A.2d 712 (1975); Scull v. Coleman, 251 Md. 6, 246 A.2d 223 (1968); Grooms v. La Vale Zoning Board, 27 Md. App. 266, 340 A.2d 385 (1975). The process mandates an initial resolution from the District Council requiring the Maryland-National Capital Park and Planning Commission to prepare an SMA proposal for designated areas; a Commission study of the affected areas; and a "Public Release” document showing the Commission’s rezoning proposal. The procedure also requires a public hearing before the Planning Board; the preparation of a final “Technical Summary” from the Planning Board to the District Council; public hearings before the District Council; and a final SMA adoption by the Council on one of its legislative days. By means of this process, the Council may implement the various county plans and policies to be incorporated with a previously adopted master plan which controls land development within the relevant planning areas. The entire process involving the Clinton-Tanglewood SMA spanned three and one-half years.

At trial, the lower court was required to construe the meaning of the words “developed and utilized” as used in the applicable section of the Prince George’s County Code. In endeavoring to interpret the disputed terms, the court was confronted with a two-fold problem: (1) “developed” or “utilized” was not defined in the county code; and (2) the meanings to be ascribed to either of these terms as used in the code had not been expressly defined in any legal precedents in Maryland. The situation was further complicated because the District Council, in adopting this statute, had not in any way indicated at what point the property reached the stage of being “developed and utilized.” The trial court in attempting to reach a conclusion as to the intended meaning of the terms determined that it was reasonable to construe the statute in the light of the Maryland cases which spoke of the “vested rights” of property owners to be protected from downgrading or rezoning of their property.

Appellee urges that the trial court was entirely correct in utilizing the doctrine “vested rights” in reaching its conclusion as to the meaning of the controversial words “developed and utilized.” That doctrine, which hás a constitutional foundation, rests upon the legal theory that when a property owner obtains a lawful building permit, commences to build in good faith, and completes substantial construction on the property, his right to complete and use that structure cannot be affected by any subsequent change of the applicable building or zoning regulations. See Washington Suburban Sanitary Commission v. T.K. U. Associates, 281 Md. 1,376 A.2d 505 (1977); Rockville Fuel and Feed Co. v. Gaithersburg, 266 Md. 117, 291 A.2d 672 (1972).

The constitutional prohibition in the Maryland and Federal Constitutions against the taking of private property for public purposes without compensation is the basis for the many decisions by our Court of Appeals which have held that once construction has proceeded substantially and amounts to more than mere grading or site preparation so as to put the neighborhood on notice that the construction toward the intended use has commenced, then the owner’s right to complete and use the structure is constitutionally protected. Pemberton v. Montgomery County, 275 Md. 363, 340 A.2d 240 (1975); Ross v. Montgomery County, 252 Md. 497, 250 A.2d 635 (1969).

The general rule as to the rights which accrue to a property owner under the “vested rights” doctrine is found in 3 A. Rathkopf, Law of Zoning and Planning ch. 57-6.57-7 (3d ed. 1972), where it is stated:

The majority rule, which can be synthesized from the multitudinous decisions in this area, may be stated as follows: A landowner will be held to have acquired a vested right to continue construction of a building or structure and to initiate and continue a use despite a restriction contained in an ordinance where, prior to the effective date of the ordinance, in reliance upon a permit theretofore validly issued, he has, in good faith, made a substantial change of position in relation to the land, made substantial expenditures, or has incurred substantial obligations.

Appellants urge, however, that the protection of the landholder as to the actual use or construction on his property does not protect the owner in the zoning of his land, and that a property owner never acquires a constitutional right to a particular zoning classification under the theory of “vested” rights. The Court of Appeals said in Steuart Petroleum Co. v. County Comm’rs; 276 Md. 435, 347 A.2d 854 (1975), that:

a property owner has no vested right in an existing zoning classification, [citations omitted], [but] there may be circumstances under which a property owner may either acquire a vested right to continue construction under a validly issued permit or a right to assert an estoppel against the issuer of the permit.

Under the factual circumstances of this case, it appears from the record that there is essentially no dispute between appellants and appellee with respect to the 0.8 acre parcel of' land. Equitable having obtained a lawful building permit and completed substantial construction has vested rights which cannot be taken away by amendment of the zoning regulations. Appellants concede the right of Equitable to continue its commercial construction on the 0.8 acre parcel to completion. As to that parcel, appellants contend the only issue is the zoning of the property rather than Equitable’s right to complete and use its commercial building in what would amount to a non-conforming use. While we accept appellants’ statement of the law that there is no constitutional right to a particular zoning classification, that principle is modified by the "developed and utilized” clause of County Code 27-574.2 (b) which precluded the District Council from "downzoning” Equitable’s property.

Appellants argue vigorously that even though Equitable has acquired vested rights to continue its construction on the 0.8 acre tract, Equitable is not entitled to the protection of the “developed and utilized” clause because it had not completed its construction before the adoption of the SMA resolution.

In interpreting the meaning of the “developed and utilized” clause, we are guided by the usual principles of statutory construction, as ordinances and statutes are construed under the same basic canons. Mayor & City Council v. First Methodist Episcopal Church, 134 Md. 593, 107 A. 351 (1919); Prince George’s County v. Bahrami, 33 Md. App. 644, 365 A.2d 343 (1976). The cardinal principle, of course, is that the court is to carry out the actual intentions of the legislative body. Schweitzer v. Brewer, 280 Md. 430, 374 A.2d 347 (1977); Baltimore Gas and Electric Co. v. County Comm’rs, 278 Md. 26, 358 A.2d 241 (1976). This intention is first to be found in a statute’s language, which is to be given its natural and ordinary signification. Department of Natural Resources v. Adams, 37 Md. App. 165, 377 A.2d 500 (1977); see 2A C. Sands, Sutherland Stat. Construction sec. 46.01 (1973). Where no ambiguity arises, a court will not look beyond the words of the statute, and “[the] court [will] not insert or omit words to make a statute express an intention not evidenced in its original form.” Police Comm’r v. Dowling, 281 Md. 412, 419, 379 A.2d 1007, 1011 (1977). And in applying statutes to cases, “[r]esults that are unreasonable, illogical, or inconsistent with common sense should be avoided whenever possible consistent with the statutory language.” Schweitzer v. Brewer, supra, 280 Md. at 438-439, 374 A.2d at 352.

At the time the Clinton-Tanglewood SMA was approved, Equitable had done the following on its 12 acre tract: (1) subdivided the 0.8 parcel creating a second parcel of 11.2 acres; (2) performed preliminary grading and excavation work on the 0.8 acre parcel; (3) obtained a building permit for the 0.8 acre parcel; and (4) poured footings and partially erected a commercial structure on the smaller parcel. Appellants urge that this does not amount to the necessary quantum of facts required to establish that the 0.8 parcel was “developed and utilized” prior to the approval of the SMA.

Black’s Law Dictionary 538 (4th ed. 1968) defines “develop” to mean “[t]o bring, or attempt to bring to a state of fruition.” The term “develop” connotes the act of converting a tract of land into an area suitable for residential or business uses. Winkleman v. City of Tiburon, 32 Cal. App. 3d 834, 843, 108 Cal. Rptr. 415 (1973). Webster’s New Int’l Dictionary (2d ed. 1959) defines “develop” as “the conversion of raw land into an area suitable for residential or business uses.”

Appellants suggest that the use of the past tense in the word “developed” means that Equitable’s property was not protected from downzoning in an SMA before construction was completed and ready to use. We do not accept this interpretation of the District Council’s intention in adopting County Code 27-574.2 (b). To accept this reading of the section contemplates an unseemly race to the finish line on the part of the property owner who must complete his building before a new SMA is adopted. The clause was obviously intended to protect the property owner who in good faith developed and utilized property subsequently included in an SMA downzoning. At least, so far as the 0.8 acre tract was concerned, Equitable had developed and utilized that tract when it obtained a valid permit to erect the commercial building authorized by the existing zoning and had made substantial progress on its completion. The definition of “utilized” as given in Webster’s Dictionary, supra, substantiates this interpretation. There, “utilized” is defined as “to make useful; to turn to profitable account or use; to make use of.”

We agree with the trial judge below that the 0.8 acre lot on which substantial construction had been completed prior to the passage of the Clinton-Tanglewood SMA was protected from downzoning. We do not, however, accept the trial court’s conclusion that the word “property” as used in the applicable “developed and utilized” clause necessarily means all property in one ownership so that development of any portion precludes the rezoning of the remainder.

To reach such a conclusion on the facts in this case would, we believe, require an unreasonable result obviously not contemplated within the legislative intention when the clause was adopted. In this case, the owner of the entire tract subdivided the 12 acre realty into two separate parcels. The development of the less than one acre parcel was undertaken without any perceivable nexus to the much larger parcel. There is no evidence to indicate the owner had even contemplated a use for the 11.2 acres. To accept the court’s rationale would presuppose that the development of less than an acre in a tract of 1000 acres, for example, would protect the same owner of the adjacent land from the effects of downzoning. We believe that the strictures enunciated in Schweitzer v. Brewer, supra, are here applicable that “results that are unreasonable, illogical or inconsistent with common sense should be avoided wherever possible.” 280 Md. at 438-39.

We conclude that the trial court was correct in its conclusion as to the 0.8 parcel, and that it erred in its finding that the SMA ordinance was inapplicable to the remaining 11.2 acre parcel.

Judgment affirmed in part, reversed in part; costs to be divided between appellants and appellee.


source: Caselaw Access Project

author: Lowe, J.,

license: Public Domain

text:
    ARTHUR M. LOVE, JR. v. GEORGE F. BACHMAN, JR. et al.
    [No. 222,
    September Term, 1979.]

      Decided December 6, 1979.

      The cause was argued before Lowe, Liss and Weant, JJ.
    Submitted on brief by Douglas G. Worrall and Smith, Somerville & Case for appellant.

      John M. Court, Assistant County Solicitor for Anne Arundel County, with whom was Richard Lazer Hillman, County Solicitor, on the brief, for appellees.
   Lowe, J.,

delivered the opinion of the Court.

In Love v. Bachman, 38 Md. App. 555 (1978), we reversed the Circuit Court for Anne Arundel County which sustained a demurrer without leave to amend in a mandamus action against the Anne Arundel _County Council. Appellant had previously obtained a summary judgment against the Board of Education of Anne Arundel County, presumably from which no appeal was taken, but found the Board had inadequate funds to satisfy the full amount. The suit in Love, supra (and here), is an attempt to enforce that judgment by compelling the County through mandamus to appropriate funds to the Board in an amount sufficient to satisfy the judgment against it.

The sole issue in the prior appeal questioning the propriety of the trial court’s judgment in sustaining a demurrer, was singularly a pleading one, the sufficiency of the original pleading. Because no reasons were assigned for its action by the trial court we deliberated in an appellate vacuum, but decided that since the demurrer had specified only two express grounds, the court’s decision had necessarily been made on one or the other so we addressed both. The two grounds were 1) whether appellant had standing to enforce (by mandamus) a duty owed by appellees to the Board, and 2) whether the imperative duty prerequisite to mandamus was sufficiently clear.

We found adequate authority in the Court of Appeals which provided appellant standing in light of his allegations. We also identified an allegation in the petition of appellees’ duty, pursuant to statute, to levy and collect taxes sufficient to meet its appropriations to the Board. In reversing, we addressed those two narrow pleading questions only. We did not address directly or inferentially either the merits of the case or any of the possible defenses thereto.

Because we were dealing with the correctness of action on demurrer, we were bound to assume the truth of all allegations in the Petition for Mandamus. Among these was the allegation that judgment had been entered against the Board in a separate case, in the Circuit Court for Anne Arundel County, No. C-7464, “from which no appeal had been taken”, and from which a balance under that judgment of $81,000 was due. The case we decided on January 13, 1978, was designated in the Circuit Court for Anne Arundel County as C-8844.

Following our reversal of C-8844, we are told by appellees that the cases were “consolidated’.’ when heard: This allegation is reinforced by the brief Memorandum Opinion and Orders of November 13,1978, filed in both C-8844 and C-7464.

“For clarification it should be noted that the trial court consolidated, for its own convenience, the mandamus action of the architect against the County (C-8844) with the amended claims asserted in C-7464 and the third party claims by the School Board against the County. Prior to the appeal of C-8844 in the Court of Special Appeals, the trial court had dismissed, without leave to amend, the School Board’s third party claim against Anne Arundel County in C-7464.”

“MEMORANDUM OF OPINION AND ORDERS

(November 13, 1978)

In Law No. C-7464, this [Circuit] Court [of Anne Arundel County] made a finding on 9 February 1978 that the Board of Education was still liable to the Plaintiff for $40,673.80 in claims, but deferred entering a judgment for that amount pending a determination of the existence or nonexistence of an appropriation from which the judgment could be paid, Board v. John K. Ruff, Inc., 278 Md. 580 (1976). In the meantime, on 13 January 1978, unknown to this Court until some time later, the Court of Special Appeals had filed its opinion in its No. 453, September Term, 1977 [38 Md. App. 555], our Law No. C-8844, in which it held ‘that a citizen with a peculiar interest has standing to enforce a judgment against a county, although it was obtained by him against another legal entity,’ and that the Plaintiff was ‘a citizen with a peculiar interest’ if he proved what he alleged in his amended petition. The Court of Special Appeals did not discuss the implications of Ruff’s holding, already cited, or the further holding that a political entity clothed with sovereign immunity can not waive that sovereign immunity.

At the last hearing of these cases, the Court entered a finding that ‘the Board of Education has no fund with which to pay the judgment’ — if a judgment were entered. The Board and the County have responded with a Motion to Dismiss by Reason of Sovereign Immunity. (The County’s standing is unchallenged but questionable; it’s demurrer to the Board’s Amended Third Party Claim was sustained without leave to amend on 19 April 1977.)

Thus the quandary is perceived: Should mandamus issue in C-8844 to require the County Council to raise funds to pay a sum due from the Board of Education to ‘a citizen with a peculiar interest’ when the Board itself is immune from judgment?

If the Court were to enter judgment, it would do so for the full amount claimed, with interest on $7,290 from this date; with interest on $18,000 from 15 December 1975; and with interest on $15,383.80 from 31 December 1975. But it is not entering the judgments, though the Plaintiff’s proof of entitlement failed in only one respect: That the Board had a fund from which the judgment could be paid. In spite of the Court of Special Appeals’ almost direct command to grant the Plaintiff relief, Ruff must be given effect, this Court being without power to overrule it even if it were persuaded that it should be.

Accordingly, it is this 13 day of November 1978, by the Circuit Court for Anne Arundel County,

ORDERED: That the Motion to Dismiss in C-7464 is granted;

That the Amended Petition in C-8844 is dismissed, the Plaintiff to pay the costs in both cases.

JAMES L. WRAY, JUDGE”

There is no docket entry or order apparent in the record, however, and certainly none in the extract (Md. Rule 1028) to indicate that the cases were consolidated. To the contrary, colloquies extracted from the transcript indicate the contrary, i.e., that the cases were heard in tandem as a convenience, rather than consolidated for that purpose.

The appeal specified that it was from the judgment entered in “Law No. C-8844”. That appellant did not appeal from the dismissal of C-7464 is apparent also from the fact that he did not extract any part of the record in C-7464 (Md. Rule 1028) nor was the record in that case forwarded to this Court pursuant to Md. Rule 1011 b within 60 days (Md. Rule 1025 a).

We are, therefore, without official knowledge of what has actually transpired in the C-7464 suit against the Board of Education. In our first opinion we were bound to assume the truth of the petition as pled, i.c., for purposes here that an unappealed judgment had been entered against the Board with an amount due under the judgment of $81,000. But the issue here is not one of the adequacy of a pleading, but rather the adequacy of the evidence.

Underlying the sufficiency of the evidence as raised by appellant’s sole question,

“Should the writ of mandamus issue as prayed?”,

is whether sovereign immunity has been waived by the Board. That issue as argued by the parties is even further refined because of the two specific criteria to be met to effect a waiver of sovereign immunity:

“[Fjirst, the Legislature must have explicitly or implicitly removed the protective barrier of governmental immunity from the agency,....” Maryland Port Adm. v. I.T.O. Corp., 40 Md. App. 697, 706 (1978),

which was accomplished by Md. Code, Art. 77, § 38;

“and second, the agency either has the funds from which it can pay the claim or it possesses the power to raise those funds.” 40 Md. App. at 706.

See also Katz v. Washington Sub. San. Comm’n, 284 Md. 503, 513 (1979). We are concerned on this appeal with whether appellant produced sufficient evidence to prove this latter criterion.

Chief Judge Gilbert, quoting from Board v. John K. Ruff, Inc., 278 Md. 580, 584 (1976), points out in Maryland Port Adm., supra at 705, the “modern rule” that has emerged from the Court of Appeals in American Structures v. City of Balto., 278 Md. 356, 359 (1976) and Board v. John K. Ruff, Inc., supra.

‘[A]n action ... brought for a money judgment in contract or in tort against the State or an agency of the State without the State’s consent, actual or implied, ... must be defended on the ground of sovereign immunity, which cannot be waived unless funds have been appropriated for the purpose or the agency can provide funds by taxation____’ (Citations omitted.) (Emphasis supplied.)”

See also Katz v. Washington Sub. San. Comm’n, 284 Md. at 513; University of Maryland v. Maas, 173 Md. 554 (1938).

Appellant concedes that if this action were against the Board as an action ex contractu, the rule aforesaid would be relevant, i.e., since the Board’s immunity was statutorily waived, the issue would be whether a Board fund exists or whether the Board had power to raise funds. He points out, however, that the bifurcated procedure he followed by two separate actions was precisely to avoid that issue.

“If. Love’s action were against the Board as an action ex contractu, the Ruff and Maas cases would be relevant. As the sovereign immunity of the Board has been waived, the issue would be whether a fund exists. Assuming a fund did not exist and further assuming arguendo that the Board had no power to raise funds, Love's action against the Board would be dismissed. It is precisely this result which engendered the determination of Love not to rely upon an action against the Board but rather to turn to the body which has the power and duty to raise funds, i.e., the Council.” (footnote omitted).

Presumably referring to our previous opinion, appellant then argues that:

“In the case at bar, this Court has already determined as a matter of law that a source of funds is available, i.e. the Council’s obligation to levy or tax and pay the receipts over to the Board pursuant to Art. 77, Sec. 117 (e), Anno. Code of Md. (157) [sic]. Further this Court has already determined as a matter of law that mandamus lies to compel the Council to produce those funds (mandamus being the proper action as Love’s contract is with the Board and not with the Council).”

That is not what this Court held in 38 Md. App. 555. We held only that appellant had factually alleged a personal interest different from the general public sufficient to give him standing; and, that assuming the truth of the allegations of the petition that an unfunded appropriation in an annual budget was approved by the appellees (County Council), it was not only authorized but “directed” to

“ ‘... levy and collect such tax upon the assessable property of the county which, together with other local revenue available,... will produce the amounts necessary to meet the appropriations made in the approved annual budget of the county board of education.’ ” Love v. Bachman, 38 Md. App. at 563, quoting Md. Code, Art. 77, § 117 (e),

which, if the truth of all allegations were proven, would provide a duty upon the Council to fund the appropriation. That, however, would be a “source of funds” available to him (standing) only if judgment had been obtained in the companion case C-7464 against the Board as he had alleged in paragraph 6 of the petition:

“6. Judgment was entered against the Board in a case filed as Love v. Asaki, et al., in the Circuit Court for Anne Arundel County as Law No. C-7464, from which no appeal has been taken. There is a balance due under the judgment of $81,000.00 with accrued interest and costs. In addition to the judgment amount there is an additional amount of $18,000.00 due, for a total amount of $99,000.00 plus interest and costs, all of which is for work done and services performed on the Center.”

Thus, for the demurrer question we assumed true, that the conditions precedent to the Council’s responsibility under Art. 77, § 117 (e) had been proven, i.e., that appellant’s right to a portion of the appropriation had been adjudicated and that

“7. [t]he Board has failed and refused to pay the amount due because the Respondents have failed and refused to pay over to the Board the funds appropriated to pay for the Center,”

as alleged.

But that which was assumed to be true for demurrer purposes has to be proven to justify the issuance of a writ of mandamus. There is nothing in the record extract to support any of these allegations except admissions by answer that the Board had requested an appropriation for the design and construction of the school in question (the architectural services for which the Board had contracted with appellant), and that the requested appropriation was submitted to the Council propitiously, after which “a” bond bill was enacted. Thus, as far as the Record Extract reveals appellant has failed to prove the prerequisites of the County’s duty to provide funds

“necessary to meet the appropriations made in the approved annual budget____”

Our extract provides us with no evidence or proof of any appropriations in an approved budget Md. Rule 1028 b 1 (b) provides that the extract must contain so much of the evidence as is material to any question, the determination of which depends upon the sufficiency of the evidence to sustain the judgment of the lower court. Appellant’s question whether the writ should issue is certainly dependent upon evidentiary sufficiency. He has failed to prove the “imperative duty” in the Council that we were required to assume for him in our prior review of this case. To give appellant every consideration we even reviewed, in the sufficiency of evidence light, those transcript excerpts included in the appendix of appellees’ brief. It was there indicated that a County finance officer testified that

“|t]here are no funds which have been appropriated by the County that have not been paid over. All funds have been paid over that have been appropriated.”

Such testimony is evidence that the Council has no imperative duty and is in itself sufficient to support the judgment of the trial court in declining to issue the writ of mandamus to the Council.

Even if the Council did owe a duty to the Board, the trial court’s judgment must still be upheld because appellant lacked standing. Appellant not only failed to prove the allegations upon which his standing was predicated in the prior appeal of this case, but he even expressly withdrew those allegations. Included in his niggardly extract, appellant sought to amend his Petition for Writ of Mandamus by orally striking paragraph 6 which we set forth above that had alleged he had an unsatisfied judgment absolute for $81,000.

“If it please the Court, I would ... amend the ... petition for Writ of Mandamus by striking ... Paragraph 6 thereof, and substituting therefor ... a finding was entered against the Board in the case filed as Love versus Asaki, et al., in the Circuit Court for Anne Arundel County as Law number C-7464____ the amount due as found ... is 40 thousand, 6 hundred and 73 dollars and 80 cents. All of which is for work done and services performed on the Center. ... in the portion of the ... Prayer, I would amend by interlineation and striking the number 99 thousand dollars and substituting therefore 40 thousand, 6 hundred, 73 dollars and 80 cents.
(Court) Alright.”

When the court permitted the amendment, appellant destroyed that upon which we predicated his standing to sue the County Council for a writ of mandamus, i.e., a final judgment. He diluted his position from judgment debtor to common claimant. Had that iteration of factfinding by a court been his only allegation on demurrer, his standing, if any, would have been precarious at best.

What subsequently occurred in the case further undercut appellant’s standing. As indicated in the order in this case, the trial judge dismissed C-7464, and right or wrong, proper or improper, that dismissal was not appealed. A finding of fact in a “dismissed” case is an opinion without a judgment — hardly a sufficient foundation of standing by “a citizen with a peculiar interest”.

It appears that appellant’s circuitous attempt to abort the “source of funds” prerequisite to a sovereign immunity waiver, has come full circle to his detriment. He has tried to straddle the source of funds’ question by leaning first upon one case as a crutch for the other and vice versa, but the time came when both crutches gave way. When the judge dismissed C-7464 from which no appeal was taken, appellant was left without a leg to stand on.

Judgment affirmed.

Costs to be paid by appellant.

      . No one has explained to us how or why a case that appeared (by allegation) to have concluded in final judgment (“from which no appeal has been taken”) could be reheard and redecided. This appears to have occurred here, but that case is not before us.

      . Appellant commenced by alluding only to Case C-8844:
      “Alright, if it please the Court, as I understand, this is Law number C-8844, which is the — on an amended Petition for Writ of Mandamus on behalf of Arthur M. Love, Jr. my client against the County Council of Anne Arundel County,”
      then proceeded subsequently to ask the court:
      “At this time, the Plaintiff would, uh, request that the Court... take judicial notice of the lawsuit entitled ... Arthur M. Love, Jr. versus George Asaki, et al., filed in the Circuit Court for Anne Arundel County, Law number C-7464, which is, of course, the case we had this morning,”
      after which he introduced various opinions and orders from that case. Such is hardly necessary in a consolidated hearing.

      . Had appellant intended the order of appeal to apply to C-7464, we would have dismissed it sua sponte since it does not appear by showing of appellant that the record’s absence is due to “neglect, omission or inability of a judge of this Court, the clerk of the lower court, the court stenographer or the appellee....” Md. Rule 1025 c. Appellant’s failure to comply with Md. Rule 1028, had he intended to appeal C-7464, is also ground for dismissal. Kemp-Pontiac-Cadillac v. S and M Constr., 33 Md. App. 516, 524 (1976).


author: Gilbert, C. J.,

text:
    WESLEY A. TYSON, SR. et ux. v. MASTEN LUMBER & SUPPLY, INC.
    [No. 240,
    September Term, 1979.]

      Decided December 6, 1979.

    The cause was argued before Gilbert, C. J., and Couch and MacDaniel, JJ.

      Augustus F. Brown for appellants.

      No brief or appearance for appellee.

      Note: Certiorari denied, Court of Appeals of Maryland, February 22, 1980.

   Gilbert, C. J.,

delivered the opinion of the Court.

INTRODUCTION.

It is written that:

“Nothing in the world lasts Save eternal change.” ( )

This appeal, arising under the Mechanic’s Lien Law is illustrative of the wisdom of those words.

The settled law of Maryland was jolted when the Supreme Court, in a series of cases, Sniadach, Fuentes, Mitchell, and North Georgia Finishing, tolled the death knell for this State’s former Mechanic’s Lien Law. Md. Real Prop. Code Ann. §§ 9-101 to 9-111 (1974). It was not until seven years after Sniadach, and one year after North Georgia Finishing, however, that the Court of Appeals, in Barry Properties v. Fick Bros., 277 Md. 15, 353 A.2d 222 (1976), presided over the interment on procedural due process grounds of the then Mechanic’s Lien Law.

In laying to rest a statute that traced its roots to 1838, Judge Digges, writing for the majority in Barry, said:

“We ... hold that under the current statute [then Md. Real Property Code Ann. §§ 9-101 to 9-111()] there can be no existing lien on property until and unless the claimant prevails either in a suit to enforce the claimed lien or in some other appropriate proceeding providing notice and a hearing (i.e., a declaratory judgment action).” 277 Md. at 37, 353 A.2d at 235.

THE LAW.

The legislative reaction to Barry was to enact an emergency law, effective May 4,1976, eighty-three days after the Barry decision. The new law was designed to avoid the procedural due process denial found in the former statute.

Prior to Barry, the statute permitted a lien to attach to a building and the land covered by it for material furnished or work done for or in or about the building. Mervin L. Blades and Son, Inc. v. Lighthouse, 37 Md. App. 265, 267, 377 A.2d 523, 525 (1977). The lien, which attached as soon as the work was done or the materials were furnished, took priority over other liens which attached subsequent to the start of the building, except other mechanics’ liens, provided an action was filed to enforce it within 180 days. The mechanics’ liens shared equality. Id. In order to preserve the lien past the 180 day period, it had to be filed in the appropriate circuit court within 180 days next following the performance of the work or the furnishing of the materials. Former section 9-105(e). If the laborer or material supplier was a subcontractor, that is, one who did not contract directly with the owner of the building, he was required to give notice to the owner within 90 days next following the performance of the work or delivery of the material of an intention to claim a lien. Former section 9-103(a); Barry v. Fick, 277 Md. at 19-20, 353 A.2d at 226; Recent Legislation, 6 U. of Balt. L. Rev. 181, 184 (1976).

The girth of the lien, as soon as the work was performed or the material supplied, immediately created a cloud on the title of the property concerned for the owner. Id. 277 Md. at 23, 353 A.2d at 228. That cloud, the Court of Appeals decided, deprived the owner of a “ ‘significant property interest’ ... and thus, the limitations of due process” were held applicable. 277 Md. at 24, 353 A.2d at 228.

The former Maryland law allowed “an owner to be deprived of a significant property interest without notice or a prior hearing.” 277 Md. at 31, 353 A.2d at 232. The denial of notice or the prior hearing conflicted with the rationale of Sniadach, Fuentes, Mitchell, and North Georgia Finishing, supra.

The present law, as we have previously stated was enacted to cure the ills of the former statute. Under the current act a lien does not automatically attach to the owner’s building upon the performance of work or the supplying of materials. It is only when a building is “erected ... repaired, rebuilt or improved to the extent of 25 per cent of its value” that a mechanic’s lien may be established.

A person claiming a lien must file a proceeding in the circuit court for the county where the land or any part of it lies, within 180 days after the completion of the work or the furnishing of the materials.

When, however, the petitioner is a subcontractor, he is not entitled to a lien, unless “within 90 days after doing the work 0* furnishing the materials, he gives written notice of his intention to claim a lien____” Md. Real Prop. Code Ann. § 9-104(a) (1979). The new law requires that the notice be given in substantially the following form:

“Notice to Owner or Owner’s Agent of Intention to Claim a Lien

Subcontractor did work or furnished material for or about the building generally designated or briefly described as

The total amount earned under the subcontractor’s undertaking to the date hereof is $............ of which .......is due and unpaid as of the date hereof. The work done or materials provided under the subcontract were as follows: (insert brief description of the work done and materials furnished, the time when the work was done or the materials furnished, and the name of the person for whom the work was done or to whom the materials were furnished).

I do solemnly declare and affirm under the penalties of perjury that the contents of the foregoing notice are true to the best of the affiant’s knowledge, information, and belief.

(Individual) on behalf of ............... (Subcontractor) (insert if subcontractor is not an individual)”

“The notice,” the statute provides, “is effective if given by registered or certified mail, return receipt requested, or [is] personally delivered to the owner by the claimant or his agent.” § 9-104(c). Notice to one of several owners is notice to all. § 9404(d).

After the petition to establish the lien has been filed, the court is charged with the duty of reviewing the “pleadings and documents on file and may require the petitioner to supplement or explain any of the matters” set out in the petition. § 9406(a)(1). If the court, following the required review, believes that a lien should attach, “it shall pass an order that directs the owner to show cause within 15 days from the date of service on the owner ... why a lien upon the land or building” ought not attach. Id. In addition, the order must inform the owner that he may (1) appear at the designated time stated in the order and present evidence in his own behalf as to why the lien should not attach; or (2) file a counter-affidavit on or before the time he is to appear. § 9406(a)(l)(i). If the owner fails to appear or to file a counter-affidavit, the statute mandates that “the petitioner’s claim shall be deemed admitted and a lien may attach to the land or buildings described in the petition.” §§ 9-106(a)(l)(ii).

The owner is at liberty to controvert statements of fact in the petitioner’s claim, but to do so, he must support his answer to the show cause order issued pursuant to section 9-106(a)(l) by an affidavit. § 9406(a)(2). The failure to file such an affidavit constitutes an admission of the truth of facts contained in the affidavit supporting petitioner’s claim. Id

Whenever an answer is filed to a show cause order, the court is directed to set the matter “for hearing at the earliest possible time.” § 9406(a)(3).

If the pleadings and allied papers, together with the evidence, if any, demonstrate “that there is no genuine dispute as to any material fact and that the lien should attach as a matter of law,” the court shall enter a final order establishing the lien. § 9406(b). Even when the pleadings, affidavits, admissions, and evidence, if any, show no genuine dispute as to a material fact, the court is not justified in permitting the lien if the petitioner fails to establish his lien as a matter of law. § 9406(b)(2). 6 U. of Balt. L. Rev., supra at 188.

The court is empowered by section 9406(b)(3) when it finds “probable cause” to believe the petitioner is entitled to a lien to pass an interlocutory order that establishes the lien, describes the boundaries of the land or building to which the lien attaches, states the amount of the claim, the amount of bond necessary to release the property from the lien, and assigns a date for trial, actionable up to six months from the date of the order. Additionally, the court may require the claimant to file a bond in a sum sufficient to satisfy damages, including reasonable counsel fees. § 9-106(b)(3)(i)-(vi).

Any interested person may at any time move the court to dissolve or modify the interlocutory order, 6 U. of Balt. L. Rev. supra at 189; § 9-106(b)(3)(vi), or ask for additional bond. § 9-106(c). Money, of course, in equal amount may be used instead of a bond. § 9-106(c).

No final order establishing the lien should be entered until and unless the petitioner prevails in an appropriate proceeding. Residential Industrial Loan Co. v. Weinberg, 279 Md. 483, 487-88, 369 A.2d 568, 566 cert. denied, 434 U.S. 876, 98 S.Ct. 227, 54 L.Ed.2d 156 (1977).

THE INSTANT CASE

Masten Lumber & Supply, Inc., the appellee, asserted that it had furnished lumber and other materials to Brick Homes, Inc., at the property of the appellants, Wesley A. Tyson, Sr., and Eleanor M. Tyson, his wife, in Cecil County, Maryland, on May 22,1978. The date of delivery, although controverted by the Tysons, was found by the trial judge to be that stated by the appellee’s location manager, Morris G. Jones and by its truck driver, Dale H. Biederman. Payment not having been received, the appellee, through its counsel, sent a letter to the appellants. The letter read:

“August 9, 1978

Mr. and Mrs. Wesley A. Tyson, Sr. Post Office Box 282 R. D. 2 North East, Maryland 21901

Dear Mr. and Mrs. Tyson:

This letter is to advise you that I represent Masten Lumber & Supply, Inc., of Milford, Delaware. They furnished lumber and materials for the construction of your home on Lot 4, Hance’s Point Manor, Cecil County, Maryland, for Brick Homes, Inc., and have not been paid the balance due them by Brick Homes, Inc.

The outstanding balance due Masten Lumber & Supply, Inc. is $6,737.10, and this letter will serve as notice to you that we intend to file Mechanic’s Line [s/e] on the property in order to ensure payment due our client.

I would suggest you turn this letter over to your attorney and/or the Bank that is financing you to ensure they withhold enough funds to pay off Masten Lumber & Supply, Inc., because the lien would be against your property and collectible through court action.

Very truly yours,

v

S/

Edward D. E. Rollins, Jr.

EDER, jr/mb

REGISTERED MAIL."

No reply was made to the letter, whereupon a “Petition to Establish Mechanic’s Lien” was filed in the Circuit Court for Cecil County on October 11,1978. An affidavit in support of the petition and exhibits was filed simultaneously. The court signed a “show cause order” and directed the Sheriff of Cecil County to effect service of process. The Sheriff made his return on October 27, 1978. The same day an answer to the petition and show cause order were filed by the appellants. The answer was accompanied by the necessary affidavits. The appellant served five written interrogatories. Md. Rule 417. The interrogatories were not answered until 2:50 p.m. on the date of the hearing on the show cause order.

The transcript reveals the following dialogue:

“The Court:... Now, gentlemen, what’s the issue before the Court, the issue to be decided in this case today?
Mr. Brown [Counsel for appellants]: Your Honor, the only issue to be decided today is the determination of whether the Court should issue an interlocutory order granting a mechanic’s lien to the Plaintiff, Masten Lumber and Supply, Inc., and, if so, to establish the boundaries, the amount of the claim for probable cause [s/e][] any bond that would be required to be filed, and the other two items that are necessary under Section 9106 [s/c][] of the Real Property Article of the Maryland Code.
The Court: All right____”

Counsel for the appellee, Masten, made no response to Mr. Brown’s view of the issue before the court. The matter proceeded with the taking of testimony.

At the conclusion of the evidence presented in behalf of Masten, the appellants, through their counsel, moved for a dismissal, Md. Rule 535, on the basis of the fact that the “notice” sent by Masten’s attorney to the appellants contained “no verification at all to the Tysons, something that the Legislature considered substantially important as far as giving notice to an owner is concerned.” Counsel also suggested that the letter had not been sent by certified mail. He then suggested to the court “that the lien should not issue because of those two items, for failure to comply with the law in giving notice to them.”

The judge believed that the notice sent to the Tysons “certainly gives them notice of the intention to file a lien for lumber, materials furnished for the construction of their home on this particular lot in Hance’s Point.” We agree. Any fair reading of the letter from Masten’s counsel to the appellants readily reveals that the notice contains some of the requisite information relative to the lien. The only deficiency argued is that it was not “verified.” The act, however, does not require mathematical precision. By its very terms, what is needed is substantial compliance. While the verification is missing, the Tysons were not in any way misled or deceived. The fact is that they noted an answer on the same day they were served with the petition, thus indicating that they knew full well what the notice contained and were primed to mount their defense. All that seemingly remained to be done was for the petition, that would trigger the litigation, to be filed in order for issue to be joined. Actual knowledge may supplant formal statutory notification. Clark v. Wolman, 243 Md. 597, 600, 221 A.2d 687, 688 (1966). Accord, Rolfe v. Clark, 269 Md. 14, 18, 304 A.2d 231, 233 (1973). See also Cottman v. Department of Natural Resources, 44 Md. App. 224, 407 A.2d 802 (1979).

The record discloses that the notice was sent by registered mail on August 10,1978. Although no return receipt is in the record, there is no question but that the Tysons received the notice. Under the circumstances, We think the notice substantially complied with the statute. The appellants’ argument with respect thereto is without merit.

The appellants, however, pose a more substantial argument as to why the “final” order establishing the lien should be reversed. They lament that the trial court used a short cut to judgment, one that is not sanctioned by the statute. Moreover, they say, it denied them an opportunity to present their entire case. We agree.

The trial court adhered strictly to the statute until the conclusion of the hearing on the show cause order. § 9406(b)(1); Md. Rule BG 73 c. Apparently, losing sight of the precise issue before it, i.e., whether there was probable cause for the establishment of the lien, § 9406(b)(3), the court proceeded to rule “that a mechanic’s lien may attach in this case for the amount [of $6,595.20].” A formal order to that effect was signed on January 19, 1979.

Counsel for the appellants reminded the court that all it had before it at the hearing was the matter of “probable cause,” and that the case had not been tried on its merits. The judge was of a different view. He responded to the appellants’ attorney that, “As far as I am concerned, all issues in this matter have been resolved by me sufficiently to enter such ... [a final] order. To schedule another hearing would be repetitious.”

What the judge overlooked was the limited role he was to play at the point in time when the hearing on the show cause order was scheduled. From what we have stated, it is obvious that the parties appeared before the court solely on the show cause order. At that stage, the court is to decide whether there is a genuine dispute of a material fact. § 9-106(b)(3); Md. Rule BG 73 d 2. The court was not justified in weighing the evidence and adjudicating the case because he was in the same position as a judge passing upon a motion for summary judgment. Md. Rule 610. Cases are legion under Rule 610 that if the pleadings, affidavits, exhibits and evidence show that there is a genuine dispute of a material fact, the court may not enter judgment. Unmistakably, the evidence, affidavits and pleadings, in the instant case, demonstrated that there was a genuine dispute of a material fact, namely the date of delivery of the materials. For that reason alone, the judge should not have entered a final order, but instead he should have followed the clear direction of § 9406(b)(3) and Md. Rule BG 73 d 2 and should have passed an interlocutory order setting out the perimeters of the lien and setting the matter for the trial of all issues necessary to final adjudication. Md. Rule BG 73 d 2 (vi).

There is yet another reason in the case now before us as to why the “final order” should not have been entered. Patently, the appellants appeared in court in answer to the show cause order. They made unmistakable the limited purpose of their visitation. Furthermore, they were not supplied, until literally the twelfth hour, with the answers to the interrogatories they had propounded to the petitioner, and they were in no position then to evaluate the answers and decide what other, if any, discovery they would employ.

The method of rushing to judgment that the trial judge utilized in the matter sub judice did not comply with the statute, § 9-106, nor with Md. Rule BG 73 d. It did not comport with due process under either the Maryland Declaration of Rights, art. 23 or the Fourteenth Amendment to the Constitution of the United States.

Order establishing mechanic’s lien reversed.

Case remanded for further proceedings.

Costs to be paid by appellee.

      . Honorat De Bueil, Marquis De Racan (1589-1650), Odes. The Coming of Spring.

      . Sniadach v. Family Finance Corp., 395 U.S. 337, 89 S.Ct. 1820, 23 L.Ed.2d 349 (1969).

      . Fuentes v. Shevin, 407 U.S. 67, 92 S.Ct. 1983, 32 L.Ed.2d 556, rehearing denied, 93 S.Ct. 177, 180 (1972).

      . Mitchell v. W.T. Grant Co., 416 U.S. 600, 94 S.Ct. 1895, 40 L.Ed.2d 406 (1974).

      . North Georgia Finishing, Inc. v. Di-Chem, Inc., 419 U.S. 601, 95 S.Ct. 719, 42 L.Ed.2d 751 (1975).

      .1838 Md. Laws, ch. 205.

      . Judge Levine dissented and Judge Eldridge joined therein. 277 Md. at 39, 353 A.2d at 236.

      . The Court, in Barry, specifically did “not decide the constitutionality of § 9407(a), which pertains to priority among holders of mechanics’ liens.” 277 Md. at 37, n. 13, 353 A.2d at 235, n. 13.

      . The new act, created by 1976 Md. Laws, ch. 349, repealed former sections 9-101 to 9-108,9-111 and 9-113. At the same time the bin enacted new sections 9-101 to 9-110, and renumbered former sections 9-109, 9-110 and 9-112. Former section 9-112 became what is now known as section 9-113; sections 9-109, 9-110 became sections 9-111, 9-112, respectively. 1976 Md. Laws, ch. 349 is now codified as Md. Real Prop. Code Ann. §§ 9-101 to 9-113 inclusive.

      . Md. Real Prop. Code Ann. § 9402(a).

      . Id. § 9405(a).

      . Other statutes contain similar legislative directions. See e.g., Md. Ann. Code art. 89, § 38(d) (1979) (judicial review of order of Division of Labor and Industry to be heard “expeditiously”); Id. Art. 89, § 76(e); Art. 95A, § 15(f) (1979) (Unemployment Insurance Law — Collections — “entitled to preference upon the calendar ... over all other civil actions except ... Workmen’s Compensation [appeals]”); Art. 101, § 56(a) (1979) (Workmen’s Compensation “All appeals from the Commission shall have precedence over all cases except criminal cases”); Art. 48A, § 242B(2) (1979) (Insurance Code — rates — appeal to be heard and decided by Baltimore City Court within 60 days from date of filing of notice of appeal); Art. 66A, § 19(a) (1978) (Motion Pictures — Censor Board disapproval decision to be heard by Circuit Court for [s/e] Baltimore City within 5 days, and decided within 2 days thereafter); Art. 78, § 93(b) (1979) (Appeals from the Public Service Commission “shall be preferred over all other civil causes ... irrespective of their position on the dockets”); Art. 33, § 19-3 (1979) (Elections — appeal to Court of Special Appeals within 5 days after trial court decision and to be “decided by the Court of Special Appeals as soon ... as may be practicable____r’). Patently, compliance with the legislative preferences referred to above is impracticable if not impossible in view of the conflict among the statutes.

      . This is obviously a deletion of words either by counsel or the court reporter. It should read, “the amount of the claim for which probable cause is found.” Md. Real Prop. Code Ann. § 9-Í06(b)(3)(iü).

      . “Section 9106” should read: “Section 9-106.”

      . The “notice” sent by Masten’s attorney did not state the “time when ... the materials [were] furnished.” This issue) however, has not been raised. We do not decide it.

      . See, e.g., Lynx, Inc. v. Ordnance Products, Inc., 273 Md. 1, 327 A.2d 502 (1974); Salisbury Beauty Schools v. State Bd. of Cosmetologists, 268 Md. 32, 300 A.2d 367 (1973); Josey v. Allstate Ins. Co., 252 Md. 274, 250 A.2d 256 (1969); McKinney Drilling Co. v. Mach I Ltd. Partnership, 32 Md. App. 205, 359 A.2d 100 (1976).

      . Article 23 of the Maryland Declaration of Rights has the same meaning and effect as the Fourteenth Amendment to the Federal Constitution. Barry Properties v. Fick Bros., supra, 277 Md. at 22, 353 A.2d at 227; Bureau of Mines v. George’s Creek, 272 Md. 143, 321 A.2d 748 (1974).


author:
Liss, J.,
      Lowe, J.,

text:
    JULIAN JACKSON et al. v. HOUSING OPPORTUNITIES COMMISSION OF MONTGOMERY COUNTY
    [No. 402,
    September Term, 1979.]

      Decided December 6, 1979.

      The cause was argued before Moore, Lowe and Liss, JJ.

      David S. Greene, with whom were Kamerow & Kamerow, P.C. on the brief, for appellants.

      Donald C. Allen, with whom were Katherine L. Bishop and Allen, Thieblot & Alexander on the brief, for appellee.
   Liss, J.,

delivered the opinion of the Court. Lowe, J., filed a concurring opinion at page 317 infra.

This case brings to mind the perhaps apocryphal story that is told about a particularly bitter debate concerning a bill pending in the Maryland Legislature. The principal opponent of the bill made an impassioned plea during the course of which he opined that if the Legislature passed the particular measure that it had before it, it would be giving away the State House. Undaunted by that allegation the sponsor of the measure in a paraphrase of Job’s comment on his biblical misfortunes rose to his feet and thundered, “The Legislature giveth; the Legislature taketh away; blessed be the name of the Legislature.” The story is appropriate in light of the case sub judice where the Legislature seems to have given, but has then taken away. Whether the name of the Legislature should be blessed in situations of this kind is a matter of opinion which we shall not here express.

This appeal arises out of an accidental personal injury suffered by Julian Jackson, appellant, on premises owned and operated by Housing Opportunities Commission of Montgomery County (hereinafter designated as the Commission). On August 2,1976, the appellant, a minor child, was an invitee on the premises known as Pomander Courts, a development operated by the Commission. The appellant, while playing with friends, leaned his weight on a metal guard railing located adjacent to steps leading to the basement of one of the apartments. The railing collapsed and the appellant fell sustaining severe injuries.

Appellants, the minor child and his parents, wrote the Commission advising them of their claim, and were advised by an insurance company that it (the insurance company) was the liability carrier for the Commission, and that all medical reports and bills were to be sent to the company. These records were sent to the carrier and several discussions concerning the settlement of the case were held. At the conclusion of these discussions appellants filed suit in the Circuit Court for Montgomery County for personal injuries sustained by the minor child and for pain and suffering as well as medical expenses. The declaration alleged negligence on the part of the Commission in failing to maintain Pomander Courts in a safe condition.

Appellee, after service, filed a motion raising preliminary objection to the suit on the grounds that there was no waiver of sovereign immunity, and even if there had been, there were no funds available out of which a judgment could be recovered. It is contended by the appellee that the Commission is an agency of the State of Maryland created pursuant to Article 44A of the Maryland Annotated Code and is entitled to sovereign immunity. Appellee’s motion came on for hearing and Judge Fairbanks, the presiding judge, granted appellee’s motion and dismissed the case. Subsequently, appellants filed a motion for reconsideration which was denied by the same judge. It is from the order granting appellee’s motion raising preliminary objection and the order denying reconsideration that this appeal was noted.

The issues raised by appellants may be stated as follows:

I. Did the Maryland Legislature expressly waive sovereign immunity as to the Housing Opportunities Commission of Montgomery County?

IL Even if the Legislature did not expressly waive immunity, has it been waived for the purposes of this case by necessary and compelling implication?

III. Was the waiver of sovereign immunity, whether express or implied, an effective waiver in this case?

I.

While appellants in their brief concede only arguendo that the Commission is a state agency, they make no effective argument to the contrary. On the basis of the reasoning set out by the Court of Appeals in Katz v. Washington Suburban Sanitary Commission, 284 Md. 503, 509-11, 397 A.2d 1027 (1979), we conclude that the Commission is indeed a state agency created by Article 44A of the Annotated Code of Maryland (1957, 1971 Repl. Vol., 1978 Cum. Supp.) and is entitled to the defense of sovereign immunity unless that defense has been waived either expressly or by implication by the Maryland Legislature.

The determination of whether sovereign immunity has been waived must be found from a reading of the statute by which the agency was created. The language of the statute must clearly indicate that a waiver was intended by the Legislature. Katz v. Washington Suburban Sanitation Commission, supra; O & B, Inc. v. Md.-Nat’l Cap. P. & P., 279 Md. 459, 369 A.2d 553 (1977); Lohr v. Upper Potomac River Commission, 180 Md. 584, 26 A.2d 547 (1942).

An examination of Article 44A of the Maryland Code discloses that Section 8 of that Article provides in relevant part that the appellee Commission in this case is granted:

[A]ll the powers necessary or convenient to carry out and effectuate the purposes and provisions of this article, including the following powers:
(a) To sue and be sued; to have a seal and to alter the same at pleasure; to have perpetual succession; to make and execute contracts and other instruments necessary or convenient to the exercise of the powers of the authority; and to make and from time to time amend and repeal by-laws, rules, and regulations, not inconsistent with this article, to carry into effect the powers and purposes of the authority.

We are mindful that the use of the phrase “to sue and to be sued” has not, in and of itself, been construed in Maryland case-law as an absolute consent to any and all kinds of suits. See Katz, supra; O & B, Inc., supra; and Lohr, supra. Furthermore, we are required to construe the phrase in connection with the other language in the act creating the state agency. The established rule is that in determining whether the Legislature intended to waive expressly the defense of sovereign immunity, the Legislature must have granted the agency the power to sue and be sued and the “action must be necessary to carry out the purposes for which the commission was created.” Lohr, supra, at 549. Accord, Weddle v. School Commissioners, 94 Md. 334, 51 A. 289 (1902).

In its original enactment, the Legislature in Section 2 of the Act made a finding and declaration of necessity which stated:

It is hereby declared, (a) that there exist in the State insanitary or unsafe dwelling accommodations and that persons of low income are forced to reside in such insanitary or unsafe accommodations; that within the State there is a shortage of safe or sanitary dwelling accommodations available at rents which persons of low income can afford and that such persons are forced to occupy overcrowded and congested dwelling accommodations; that the aforesaid condition cause an increase in and spread of disease and crime and constitute a menace to health, safety, morals and welfare of the residents of the State and impair economic values; that these conditions necessitate excessive and disproportionate expenditures of public funds for crime prevention and punishment, public health and safety, fire and accident protection, and other public services and facilities; (b) that these slum areas cannot be cleared, nor can the shortage of safe and sanitary dwellings for persons of low income be relieved, through the operation of private enterprise, and that the construction of housing projects for persons of low income (as herein defined) would therefore not be competitive with private enterprise; (c) that the clearance, replanning and reconstruction of the areas in which insanitary or unsafe housing conditions exist and the providing of safe and sanitary dwelling accommodations for persons of low income are public uses and purposes for which public money may be spent and private property acquired; that it is in the public interest that work on such projects be commenced as soon as possible in order to relieve unemployment which now constitutes an emergency; and the necessity in the public interest for the provisions hereinafter enacted, is hereby declared as a matter of legislative determination.

Specifically, with respect to Montgomery County, the Legislature, in 1974, adopted Chapter 508, Section 1, codified as Article 44A, Section 8A which in essence restated the finding and declaration of necessity as it applied to Montgomery County.

In establishing the Housing Authorities Article, the Legislature in Section 8 enumerated the powers necessary or convenient to carry out and effectuate the purposes and provisions of the Article. In subsection (b) was the power ‘j wjithin its area of operation: To prepare, carry out, acquire, lease and operate housing projects; to provide for the construction, reconstruction, improvement, alteration or repair of any housing project or any part thereof.” Subsection (d) of Section 8 gives the authority broad powers as follows:

To lease or rent any dwellings, houses, accommodations, lands, buildings, structures or facilities embraced in any housing project and (subject to the limitations contained in this article) to establish and revise the rents or charges therefor; to own, hold, and improve real or personal property; to purchase, lease, obtain options upon, acquire by gift, grant, bequest, devise, or otherwise any real or personal property or any interest therein; to acquire by the exercise of the power of eminent domain any real property; to sell, lease, exchange, transfer, assign, pledge or dispose of any real or personal property or any interest therein; to insure or provide for the insurance of any real or personal property or operations of the authority against any risks or hazards; to procure insurance or guarantees from the federal government of the payment of any debts or parts thereof (whether or not incurred by said authority) secured by mortgages on any property included in any of its housing projects. [Emphasis supplied.]

The Court of Appeals said in Katz v. Washington Suburban Sanitary Commission, 284 Md. at 513:

As heretofore indicated, a legislative waiver of sovereign immunity is ineffective unless specific legislative authority to sue the agency has been given, and unless there are funds available for the satisfaction of the judgment, or power reposed in the agency for the raising of funds necessary to satisfy a recovery against it. American Structures v. City of Balto., 278 Md. 356, 359, 364 A.2d 55 (1976); Chas. E. Brohawn & Bros. v. Board, [269 Md. 164, 304 A.2d 819 (1973)]; University of Maryland v. Maas, 173 Md. 554, 559, 197 A. 123, 125 (1938); Fisher & Corozza Co. v. Mackall, 138 Md. 586, 114 A. 580 (1921); State v. Rich, 126 Md. 643, 95 A. 956 (1915). To constitute an effective waiver, therefore, § 1-3 of the WSSC Code must contain both a clear waiver of immunity as to matters within the scope of the agency’s duties and obligations, and an authorization for the appropriation of funds to satisfy a judgment rendered against it in tort.

When we examine this statute, however, in the light of other statutes in which a clear waiver of sovereign immunity has occurred, we find Article 44A ineffective to meet the requirements of either an express or implied waiver of sovereign immunity as to this governmental agency. The legislative history of the waiver of sovereign immunity found to exist in Katz, supra, is substantially different from that found in this case. In Katz, the Court of Appeals pointed out that the original statute permitting the Sanitary Commission to sue or be sued had been amended to provide for the payment of judgments recovered against the Commission. The Court pointed out that Section 1-3 of the amended statute specifically provided:

“In the event of a judgment at law or in equity being recovered against said commission or for the purpose of amicably adjusting threatened or pending litigation, the commission shall at the annual tax levying period of the county council of Montgomery County and the county commission of Prince George’s County next succeeding the rendition of said judgment or compromise, certify to said county council of Montgomery County and county commissioners of Prince George’s County, a tax rate, in addition to that required for its interest, serial bonds and sinking fund requirements, that will, when levied and collected under the provisions of ... [section 4-5 of this Code], produce an amount sufficient to satisfy said judgment or other sum including costs and counsel fees, if any, provided, however, that this provision shall relate only to any cause of action occurring subsequent to April 26, 1927....”

The provision of § 1-3 authorizing the WSSC to certify a tax rate sufficient to produce funds to satisfy a judgment rendered against it was not part of the section as it was originally enacted. It was added by ch. 506 of the Acts of 1927, in apparent response to the decision in Washington Suburban Sanitary Commission v. Magruder, 12 F.2d 832 (D.C. Cir.), decided May 3, 1926. Magruder held that while the WSSC could “sue and be sued,” it was nevertheless immune from suit because under § 1-3 as it then read, and the controlling Maryland law, the agency had no means to satisfy judgments in tort suits because it had no power “to raise money for the purpose of paying damages.” 12 F.2d at 833. The 1927 amendment to § 1-3, which was effective only with respect to “any cause of action occurring subsequent to April 26, 1927,” was, we think, a well-calculated and specific procedure to authorize the WSSC to acquire the funds necessary to satisfy a judgment rendered against it or to amicably settle threatened litigation. When read as a whole, § 1-3 clearly expresses a legislative intent to waive the WSSC’s sovereign immunity. To hold otherwise would be to disregard both the “sue and be sued” clause and the provision for satisfaction of judgments which follows it. [284 Md. at 514-15.]

We are required to determine whether there are funds available for the satisfaction of a judgment rendered against the Commission or power reposed in the agency for the raising of funds necessary to satisfy such a judgment. We conclude that there are no such funds available nor does any such power exist.

Section 9 of Article 44A vests the Commission with broad powers to determine the rentals charged for the dwelling accommodations offered to eligible tenants and directs that:

The authority shall fix the rentals for dwellings in its projects at no higher rates than it shall find to be necessary in order to produce revenues which together with all other available moneys, revenues, income and receipts of the authority from whatever sources derived will be sufficient (a) to pay, as the same become due, the principal and interest on the bonds of the authority; (b) to meet the cost of, and to provide for, maintaining and operating the projects (including the cost of any insurance) and the administrative expenses of the authority; and (c) to create (during not less than the six years immediately succeeding its issuance of any bonds) a reserve sufficient to meet the largest principal and interest payments which will be due on such bonds in any one year thereafter and to maintain such reserve. [Emphasis supplied.]

The Legislature specifically granted to the Commission the authority to insure or provide for the insurance of any real or personal property or operations of the authority against any hazard or risks. It also authorized the authority to include the cost of insurance in its calculation of the rents to be charged the tenants. It did not, however, empower the Commission to include in its calculation of rents any sum of money necessary to satisfy a judgment rendered against the Commission or to amicably settle threatened litigation. There is nothing in the legislative enactment here being considered which sets out the limits of liability of the Commission and what, if anything, is required of the Commission in the event a judgment recovered against it exceeds the amount for which it is insured.

An examination of the statutes enacted by the Legislature involving other state agencies indicates that the Legislature has been extremely careful in those instances, where an effective waiver of sovereign immunity has been adopted, to spell out the obligations of the agency and the source from which payment of judgments rendered against it may be sought.

For example, in Article 41, Section 10A the Legislature in revoking the defense of sovereign immunity in contract actions specifically provided as follows:

(a) Defense not to be raised in certain actions. — Unless otherwise specifically provided by the laws of Maryland, the State of Maryland, and every officer, department, agency, board, commission, or other unit of State government may not raise the defense of sovereign immunity in the courts of this State in an action in contract based upon a written contract executed on behalf of the State, or its department, agency, board, commission, or unit by an official or employee acting within the scope of his authority.
(b) No liability for punitive damages. — In any such action, the State, or its officer, department, agency, board, commission, or other unit of government is not liable for punitive damages.
(c) Limitation of actions. — A claim is barred unless the claimant files suit within one year from the date on which the claim arose or within one year after completion of the contract giving rise to the claim, whichever is later.
(d) Funds to be provided in budget. — In order to provide for the implementation of this section, the Governor annually shall provide in the State budget adequate funds for the satisfaction of any final judgment, after the exhaustion of any right of appeal, which has been rendered against the State, or any officer, department, agency, board, commission, or other unit of government in an action in contract as provided in this section.

The Legislature also enacted Chapter 825, Acts of 1976, effective July 1, 1976 which added subsection (CC) to Article 25A (grant of express powers to chartered counties). In that section, the Legislature specifically set out as follows the manner and the extent of waiver of sovereign immunity which could be provided by chartered counties by ordinance or by inclusion in the county charter:

To provide by ordinance or inclusion in the county charter for the waiver of sovereign immunity so that the county may be sued in tort actions in the same manner and to the same extent that any private person may be sued. Any chartered county enacting legislation or otherwise waiving sovereign immunity under this subsection shall carry comprehensive liability insurance to protect itself, its agents and its employees. The purchase of this insurance shall be considered as for a public purpose and as a valid public expense. The liability of any county under this subsection may not be greater than $250,000 or the amount of its insurance coverage, whichever is greater, per individual per occurrence. A county which has adopted legislation or otherwise availed itself of the powers contained in this subsection may raise the defense of sovereign immunity to any amount in excess of the limit of its insurance coverage. In any case, the several counties or any county availing itself of the privileges of this subsection may not raise the defense of sovereign immunity in any claim of less than $250,000 or the amount of its insurance coverage, whichever is greater.

In 1978, the Legislature adopted a waiver of the defense of sovereign immunity on behalf of the state agency boards of education. Section 4-105 of the Education Article provides:

(a) Comprehensive liability insurance. — Each county board shall carry comprehensive liability insurance to protect the board and its agents and employees. The purchase of this insurance is a valid educational expense.
(b) Standards for policies; coverage. — The State Board shall establish standards for these insurance policies, including a minimum liability coverage of not less than $100,000 for each occurrence. The policies purchased under this section shall meet these standards.
(c) Self-insurance; minimum coverage. — (1) A county board complies with this section if it is self-insured for at least $100,000 for each occurrence under the rules and regulations adopted by the State Insurance Commissioner.
(2) A county board that elects to self-insure under this subsection periodically shall file with the State Insurance Commissioner, in writing, the terms and conditions of the self-insurance.
(3) The terms and conditions of this self-insurance:
(i) Are subject to the approval of the State Insurance Commissioner; and
(ii) Shall conform with the terms and conditions of comprehensive liability insurance policies available in the private market.
(d) Defense of sovereign immunity. — (1) A county board may raise the defense of sovereign immunity to any amount claimed above the limit of its insurance policy or if self-insured, above $100,000.
(2) A county board may not raise the defense of sovereign immunity to any claim of $100,000 or less.

An examination and comparison of these statutes with Article 44A, here at issue, convinces us that while the Legislature may have intended to waive sovereign immunity when it granted the right to sue and to be sued to the Commission, that that grant was in and of itself insufficient, by the authorities cited, to effect such a waiver either expressly or by implication. Nor did the grant of authority to purchase insurance accomplish a waiver of sovereign immunity.

The Court of Appeals has said in Quecedo v. Montgomery County, 264 Md. 590, 287 A.2d 257 (1972) that the mere existence of liability insurance will not be sufficient to create tort liability unless the “legislative enactments creating the agency or corporation considered as a whole lead to the conclusion that it was the intention of the Legislature to impose such liability on the agency....” 264 Md. at 595. It is clear the Legislature, whatever it intended, failed to make available the funds required for the satisfaction of a judgment against this state agency and failed to invest the agency with the power to raise the funds necessary to satisfy any recovery against it. Under these circumstances, there has not been either an express or implied waiver of immunity.

There is one further matter which we feel impelled to address in this case. At the very beginning of the claim for damages, there is evidence in the record that the appellants were notified that the Commission “is a separate state agency with its own insurance coverage.” Also in the record is an uncontradicted affidavit by appellants’ attorney in response to the supplemental memorandum filed by the appellee before the hearing below. That affidavit established the fact that there had been correspondence, and negotiations with an identified insurance company which represented itself as the liability carrier for the appellee. No affidavit in opposition to these allegations was offered by the appellee. We therefore conclude that the appellee was, in fact, represented in this claim by the insurance company indicated.

No defense of sovereign immunity was raised until the parties were unable to reach an agreed settlement figure. That defense was then made for the first time when suit was filed against the Commission.

Such an eleventh hour tactic prevents taxpayers from having their day in court and also obviates a determination as to whether the state agency has properly met its obligation to provide safe housing for its tenants. If the Legislature does not move promptly to close this loophole, innumerable tenants will remain without redress for the grossest of negligence, and insurance companies will continue to collect premiums for coverage under policies in which they may be assuming no risk.

Judgment affirmed, costs to be paid by appellants.

Lowe, J.,

concurring:

I must concur that the law is as interpreted by the majority but I am compelled to deplore that a government agency created to provide housing, is not liable for its failure to provide it safely. If an insurance company accepts premiums to insure, it should be statutorily deprived of the shield of immunity to the extent of coverage sold as has been done in the case of charitable institutions. See Md. Code, Art. 48A, § 480; Eliason v. Funk, 233 Md. 351 (1964); Gorman v. St. Paul Fire Ins. Co., 210 Md. 1 (1956). See also Md. Code, Art. 43, § 556A. Such is a legislative concern, however, not one we may alter.

I am equally concerned that an insurance company has been paid premiums out of taxpayers’ pockets to insure an immune agency. If this has knowingly been done, both the payor and the payee have misused public funds and, if not criminally liable, should be held civilly liable for the unwarranted and unauthorized expenditure. While these too may be legislative matters, they come quite close, and circumstantially may cross, the judicial line.

I concur — with reluctance — in the result.