author: Menchine, J.,

text:
    THE SWARTHMORE COMPANY v. COMPTROLLER OF THE TREASURY
    [No. 258,
    September Term, 1977.]

      Decided December 29, 1977.

      The cause was argued before Moylan, Menchine and Davidson, JJ.

      Jack C. Merriman, with whom were Weinberg & Green on the brief, for appellant.

      Gerald Langbaum, Assistant Attorney General, with whom was Francis B. Burch, Attorney General, on the brief, for appellee.
   Menchine, J.,

delivered the opinion of the Court.

The Swarthmore Company (Swarthmore), a Maryland corporation, in its State income tax returns for the years 1971, 1972 and 1973 claimed as deductions from taxable income certain items of interest income, relying upon Maryland Code Article 81, § 280A (c) (4) (1975 Repl. Vol.) as the same existed during the years covered by the returns. The Comptroller disallowed the deduction and assessed a deficiency in the amount of $14,239.92 against Swarthmore on January 28, 1975. On February 25, 1975, Swarthmore filed a Petition of Appeal to the Maryland Tax Court.

The Facts

The case was submitted for decision on an agreed stipulation of facts that may be summarized as follows:

Swarthmore, a closely held corporation, was incorporated in 1955. All outstanding stock was controlled by the Keelty and Dorment families.

The corporation was formed to acquire land, create ground rents thereon and transfer the land to builders and developers subject to the ground rents. On one parcel of unsold land, Swarthmore constructed in 1970 a service station and leased the improvements.

By the early 1960’s Swarthmore’s cash position permitted it to lend money and acquire assignments of mortgages. Swarthmore did so as follows:

1. Made a series of cash loans to Doncaster Realty, Inc. (Doncaster) totaling $175,000.00.
The officers of Doncaster also were officers of Swarthmore. James Dorment was its sole stockholder. No interest was paid on these loans until 1972 when the loans were paid in full with interest.
2. Purchased at a discount from Rodgers Forge Apartments, Inc. the latter’s interest in a mortgage from Manor Estates, Inc. (Manor) upon property in Bolusia County, Florida.
Two thirds of the stock of Manor was owned by James Dorment, Margaret Dorment and James Keelty. Interest was paid on this mortgage in 1971,1972 and 1973.
3. Purchased at a discount from Beach Manor Estates (Beach Manor) a mortgage of Ocean Front Estates, a Florida Corporation. (The locale of the property securing the mortgage is not recited in the stipulation.)
The Dorment family owned no stock in Ocean Front and the Keelty family probably did not.

No other business connection existed between Swarthmore and the three obligors named above whose debt instruments were acquired by it. The only transactions between Swarthmore and Doncaster were the loans referred to in “1” above. There were no transactions between Swarthmore and the mortgagors named in “2” and “3” above, the original loans having been made by other lenders.

The interest received from the sources described above was deducted by Swarthmore from its Maryland taxable income for the years 1971,1972 and 1973. Swarthmore contends that the deduction was authorized by statute.

During the years 1971 and 1972 Swarthmore had interest expense on a long-term mortgage in the amounts of $56,292.00 and $37,960.00, respectively.

The Decisions Below

The Maryland Tax Court sustained the Comptroller’s deficiency assessment that had followed disallowance of the claimed deduction. Swarthmore appealed to the Circuit Court for Baltimore County. That court affirmed. Swarthmore now appeals to this Court. We shall affirm.

The Law

During the years in question the taxable income of corporations was to be calculated under the provisions of Maryland Code Article 81, § 280A (1975 Repl. Yol.). That section, during the years in question, read as follows:

“§ 280A. Net income of corporation.
(a) in general. — The net income of a corporation shall be the taxable income of such taxpayer as defined in the laws of the United States as amended from time to time and for the corresponding taxable period or in the case of a regulated investment company, investment company taxable income as defined in the laws of the United States as amended from time to time and for the corresponding taxable period, except as hereinafter modified.
(b) Amounts to be added to taxable income. — There shall be added to the taxable income of such taxpayer: (1) except in the case of disaster losses, as defined in § 165(h) of the Internal Revenue Code as amended from time to time, occurring on or after June 1, 1972, the net operating loss deduction as defined in § 172 of the Internal Revenue Code, as amended from time to time; (2) income taxes imposed by the State of Maryland, and any other state, the District of Columbia and any political subdivision of the State of Maryland or any other state; (3) the net capital loss carry-back as defined in § 1212 of the Internal Revenue Code,, as amended from time to time and (4) for all taxable years beginning after December 31, 1973, the oil percentage depletion allowance as claimed and allowed under § 613 of the Internal Revenue Code.
(c) Amounts to be subtracted from taxable income. — There shall be subtracted from taxable income of such taxpayer the following items to the extent included in federal income: (1) operating revenue subject to gross receipts taxes imposed by this article (less related expenses) of railroads, other public utilities and contract carriers; (2) fifty (50) percent of the excess of net long-term capital gain over net short-term capital loss as defined in the laws of the United States, as amended from time to time; (3) the amount of any refunds of income taxes paid to the State of Maryland, any other state, the District of Columbia, and any political subdivision of the State of Maryland and any other state; and (4) dividend income to the extent included in taxable income and any interest income other than interest earned in the conduct of a business, on loans made under the provisions of Article 58A of this Code, and interest earned on business accounts, notes receivable and installment contracts.” (Emphasis added.)

In this case we have no doubt that interest received by Swarthmore by reason of the subject transactions was earned in the conduct of its business. We think that such loans and mortgage acquisitions, while differing in many legal aspects from the creation of the liens of ground rents, are in pari materia with the latter respecting the corporation’s search for profit in the ordinary conduct of its business affairs.

The stipulation of the parties makes plain that during two of the years now in question, Swarthmore incurred substantial interest expense on a long-term mortgage indebtedness that served as a lawful deduction from its earned income. Yet, it claims that it cannot be taxed on interest it earned upon transactions necessarily interconnected with those borrowed funds. This is an anomaly wholly unjustified by the letter and spirit of § 280A.

We examine Swarthmore’s claim in the light of the firmly fixed rule of law that exemptions from taxation are not favored. That rule was succinctly restated in Perdue v. St. Dept. of Assess. & T, 264 Md. 228, 232-33, 286 A. 2d 165, 167-68 (1972), as follows:

“It is fundamental that statutory tax exemptions are strictly construed in favor of the taxing authority and if any real doubt exists as to the propriety of an exemption that doubt must be resolved in favor of the State. In other words, ‘to doubt an exemption is to deny it.’ Pan Am Sulphur v. State Dep't, 251 Mid. 620, 629, 248 A. 2d 354 (1968); Macke Co. v. State Dep't of Assessments and Taxation, 264 Md. 121, 285 A. 2d 593 (1972). Suburban, etc. Gas Corp. v. Tawes, 205 Md. 83, 87, 106 A. 2d 119 (1954); Pittman v. Housing Authority, 180 Md. 457, 460, 25 A. 2d 466 (1942).”

The reasons for formulation of the rule were well explicated in Pittman v. Housing Authority, 180 Md. 457, 25 A. 2d 466 (1942), wherein it was said at 460-61 [468]:

“It is a firmly established principle of law that exemptions from taxation are not favored, but are strictly construed in favor of the State. Chief Justice Marshall said of the taxing power: ‘It is granted by all, for the benefit of all. It resides in government as a part of itself, and need not be reserved, when property of any description, or the right to use it in any manner, is granted to individuals or corporate bodies. However absolute the right of an individual may be, it is still in the nature of that right that it must bear a portion of the public burdens; and that portion must be determined by the Legislature.’ Providence Bank v. Billings, 4 Pet. 514, 563, 7 L. Ed. 939, 956. Therefore, before any claimant can obtain an exemption, it is encumbent upon him to show affirmatively that the alleged exemption has been clearly allowed by law. If there is a real doubt upon the subject, that doubt must be resolved in favor of the State. It is only where the deliberate purpose of the Legislature to grant an exemption is expressed in clear and unequivocal terms that a claim to an exemption can be maintained. City of Baltimore v. Grand Lodge of Masons, 60 Md. 280, 282, 283. The rule of strict construction of tax exemptions does not call for strained or unreasonable construction to the extent of being adverse to the real legislative intention, for the judicial interpretation must always be in accordance with the actual meaning of the lawmaking power. But an exemption claim cannot be sustained unless it is shown to be within the spirit as well as the letter of the exemption law. Broadbent Mantel Co. v. City of Baltimore, 134 Md. 90, 106 A. 250; Grand Lodge of Maryland, Knights of Pythias v. City of Baltimore, 157 Md. 542, 146 A. 744; Bistline v. Bassett, 47 Idaho 66, 272 P. 696, 62 A. L. R. 323.”

We have no doubt that § 280A (c) (4), supra, was intended to assure that “interest earned in the conduct of a business” should not be a subtractable item from the taxable income of a corporation. While the language following the quoted words of the subsection is inartful and somewhat ambiguous, it does not, under the facts of this case, provide a basis for lawful deduction by this taxpayer of interest derived from the described transactions.

We think that the subsection evidences a legislative intent to assure that “interest earned in the conduct of a business” be taxed, with only specified kinds of nonbusiness interest income being exempt. Such interpretation finds the clearest support from subsequent legislative action amending the subsection. The Legislature in 1976, by the passage of identical amendments in Chapters 637, 811 and 904, struck out the italicized language of § 280A (c) (4), supra. In the title to each of these three chapters the Legislature declared the purpose intended to be subserved by the amendment. The titles declared that the amendatory acts were intended:

“For the purpose of... including in the income of corporations subject to State income tax nonbusiness interest and dividend income to the same extent included under the federal income tax ...." (Emphasis added.)

The necessary implication of this title language, coupled with the deletion of the language of § 280A (c) (4) upon which the appellant relies (as italicized, supra) is clear. It is that § 280A (c) (4) in the form of its passage by Ch. 142 of the Acts of 1967, had been intended to provide a very limited exemption applicable only to specified nonbusiness interest income.

While subsequent legislative interpretation of a prior statute is not binding or controlling on the Court, Crunkleton v. Barkdoll, 227 Md. 364, 369, 177 A. 2d 252, 255 (1962), a subsequent “statute purporting to declare the intent of an earlier one might be of great weight in assisting a court when in doubt.” United States v. Stafoff, 260 U. S. 477, 480, 43 S. Ct. 197, 199, 67 L. Ed. 358, 361 (1923). The language in the titles of the amendatory statutes of 1976 persuades us that § 280A (c), supra, as enacted by Ch. 142 of the Acts of 1967, had been intended to exclude from taxable income only certain non-business interest income.

The interest income of the subject taxpayer earned by the described transactions was interest earned in the conduct of its business and was subject to income taxation. The deficiency assessment by the Comptroller, as affirmed by the Maryland Tax Court and the Circuit Court for Baltimore County, was properly imposed.

Swarthmore was not entitled to the claimed deduction.

Order affirmed.

Appellant to pay the costs.

      . The section controlling the subject litigation was amended by Chs. 637, 811 and 904 of the Laws of Maryland 1976.


source: Caselaw Access Project

license: Public Domain

text:
    STEVEN A. LORD v. MARYLAND AUTOMOBILE INSURANCE FUND
    [No. 327,
    September Term, 1977.]

      Decided December 29, 1977.

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

      Daniel E. Schultz and Melinda Gray Murray for appellant.

      Ransom J. Davis, Assistant Attorney General, with whom was Francis B. Burch, Attorney General, on the brief, for appellee.
   Menchine, J.,

delivered the opinion of the Court.

Steven A. Lord (Lord), a non-resident of Maryland, incurred medical and hospitalization expenses in the amount of approximately $18,000 as a result of an automobile accident in Louisville, Kentucky that occurred while he was driving an insured’s automobile with her consent. The owner of the vehicle was the named insured under a policy of insurance issued by Maryland Automobile Insurance Fund (MAIF).

Lord sought payment of benefits from MAIF claiming entitlement by reason of Maryland Code Article 48A, § 539 that reads in pertinent part as follows:

“§ 539.
(a) No policy of motor vehicle liability insurance shall be issued, sold or delivered in this State after January 1, 1973, unless the policy also affords the minimum medical, hospital and disability benefits set forth herein; or unless equivalent medical, hospital, and disability benefits are provided by a policy issued to the insured by a nonprofit health service plan or by an authorized insurer with the policy in each case subject to approval by the Commissioner. The benefits, or their equivalent, shall cover the named insured and members of his family residing in his household (except such persons as may be specifically excluded in accordance with § 240C-1 of this article) injured in any motor vehicle accident (including an accident involving an uninsured motor vehicle or a motor vehicle whose identity cannot be ascertained), other persons injured while occupying the insured motor vehicle as a guest or passenger, or while using it with the express or implied permission of the named insured (except as provided in § 240C-1 of this article), and pedestrians injured in an accident in which the insured motor vehicle is involved or individuals injured in, on, or alighting from any other vehicle operated by animal or muscular power in an accident in which an insured vehicle is involved. The minimum medical, hospital and disability benefits shall include up to an amount of $2,500, for payment of all reasonable expenses arising from the accident and incurred within three years from the date thereof for necessary medical, surgical, x-ray and dental services, including prosthetic devices, and necessary ambulance, hospital, professional nursing and funeral services; and in the case of an income producer, payment of benefits for loss of income as the result of the accident; and where the person injured in the accident was not an income or wage producer at the time of the accident, payments of benefits must be made in reimbursement of necessary and reasonable expenses incurred for essential services ordinarily performed by the injured person for care and maintenance of the family or family household. The insurer providing loss of income benefits may require, as a condition of receiving such benefits that the injured person furnish the insurer reasonable medical proof of his injury causing loss of income.”

MAIF denied Lord’s claim upon the ground that it was excluded by the following provision of the insurance contract:

“THIS POLICY DOES NOT APPLY:
(u) under Division 1 of Coverage C. to any person other than the Named Insured or a member of his family who is a resident of the same household if the accident occurs outside of Maryland.”

Lord instituted suit against MAIF in the Circuit Court for Prince George’s County. In due course Lord’s motion for summary judgment was denied. Thereafter, even though MAIF had not filed a cross-motion for summary judgment, the t^rial court rendered summary judgment for it pursuant to Maryland Rule 610 d. 1.

The respective positions of Lord and MAIF are thus succinctly stated in their briefs:

(Lord)
“Plaintiff’s right to recover medical benefits up to $2500 is controlled by the statute establishing MAIF and the minimum standards for insurance policies and cannot be denied based on a territorial exclusion in the policy.”
(MAIF)
“The exclusion contained in Paragraph (u) of the ‘Exclusions’ Section of MAIF’S policy is consistent with Maryland Law as to the required content of a policy of motor vehicle liability insurance issued in this State.”

It is quite plain that any provision of an automobile liability insurance policy that is in conflict with the requirements of a statute is illegal and ineffective. Casualty Co. v. Hinds, 180 Md. 676, 679, 26 A. 2d 761, 762 (1942); Peninsula Insurance v. Houser, 248 Md. 714, 721, 238 A. 2d 95, 99 (1968).

It is equally plain that policy provisions narrowing the insurer's liability in a manner not inconsistent with statutory requirements is valid and permissible. Amalgamated Ins. v. Helms, 239 Md. 529, 539, 212 A. 2d 311, 318 (1965); Malisfski v. Indemnity Ins. Co. of North America, 135 F. 2d 910, 914 (4th Cir. 1943).

In Malisfski, supra, the Court rejected a contention that provisions of the prior Maryland financial responsibility law nullified an exclusion exception to an omnibus coverage clause of an insurance contract.

In Couch on Insurance 2d § 37:803 (1961), it is said:

“§ 37:803. Provisions relating to place or area of use.
Insurers commonly restrict the coverage of policies on vehicles to use within a specified area, either requiring that all use be within that area or more commonly that the regular or frequent use be within that area. Such restrictions as to area of use are not conditions.
Territorial use limitations are valid.”

There is no statute imposing more extensive coverage requirements for policies issued by MAIF than those imposed by law upon private insurance carriers. Indeed, a reading of the coverage statutes makes plain that the requirements for both are identical.

The statute imposing policy requirements upon private insurance carriers is codified as Md. Transp. Code Ann. § 17-103 and reads as follows:

“§ 17-103.
(a) Required form. — (1) Except as provided in paragraph (2) of this subsection, the form of security required under this subtitle is a vehicle liability insurance policy written by an insurer authorized to write these policies in this State.
(2) The Administration may accept another form of security in place of a vehicle liability insurance policy if it finds that the other form of security adequately provides the benefits required by subsection (b) of this section.
(b) Required minimum benefits. — The security required under this subtitle shall provide for at least:
(1) The payment of claims for bodily injury or death arising from an accident of up to $20,000 for any one person and up to $40,000 for any two or more persons, in addition to interest and costs;
(2) The payment of claims for property of others damaged or destroyed in an accident of up to $5,000, in addition to interest and costs;
(3) The benefits required under Article 48A, § 539 of the Code as to basic required primary coverage; and
(4) The benefits required under Article 48A, § 541 of the Code as to required additional coverage. ” (Emphasis added.)

Statutory policy requirements for MAIF include, inter alia, Annotated Code of Maryland Article 48A, § 541 (1972 Repl. Vol., 1973 Cum. Supp.) that in pertinent part reads as follows:

“§ 541.
(a) Minimum liability coverage required by Article 66A, § 7-101. Nothing in this subtitle shall be deemed to affect or limit the provisions of § 7-101 of Article 66A of the Annotated Code of Maryland (1970Replacement Volume and 1972Supplement), and every policy of motor vehicle liability insurance issued, sold, or delivered in this State shall provide the minimum liability coverage specified therein.” (Emphasis added.)

We discern in the above statutes no legislative intent to bar any insurer from imposing a contractual territorial limitation which excludes non-residents 2 of the State of Maryland. Dunn v. Traders & General Ins. Co., 287 S.W.2d 682 (Tex. Civ. App. 1956).

In the absence of such legislative intent, we find the language of Empire Fire and Marine Insurance Co. v. Brake, 472 S.W.2d 18 (K.C. Ct. of App. Mo. 1971) to be persuasive here. There, the contention was made that exclusions were void as against public policy. In rejecting the contention the Court said at 24:

“We are cited to no other statute declaring the policy of this State to require the striking down of such an exclusionary clause. We are invited to judicially formulate such a policy by the argument of appellant.”

The Court declined to do so in the absence of a legislative declaration of public policy.

We find'no statutory bar to incorporation of exclusion (u), supra, in the MAIF policy. We decline to declare judicially that public policy considerations invalidate the exclusion provision.

Under the undisputed facts, MAIF was not liable to Lord by reason of exclusion (u). Summary judgment in favor of MAIF was properly granted.

Judgment affirmed.

Appellant to pay the costs.

      1. Division 1 of Coverage C reads as follows:
      “Coverage C — Economic Loss To pay:
      Division 1. To or for each person who sustains bodily injury, sickness or disease, caused by accident, while in or upon or while entering into or alighting from the automobile, or to each person who sustains such injury, sickness, or disease while a pedestrian as the result of an accident in which the automobile is involved, provided the automobile is being used by the Named Insured or his spouse if a resident of the same household, or with the permission of either, or by a member of the family of the named insured if a resident of the same household.”

      2. Now codified as Md. Transp. Code Ann. § 17-103, supra.

      . The Insurance Commissioner of Maryland on March 4, 1974, after a hearing conducted on ¡September 25, 1973 to/ consider the permissible limits of policy exclusions relating to Economic Loss Coverage (Personal Injury Protection), passed a Notice and Order that included the following:
      “2. The filed forms generally eliminate coverage for guest passengers or pedestrians involved in out-of-State accidents. The effect of the broad wording of the exclusion would be to deny Maryland residents coverage if they are guest passengers or if they are pedestrians in another state ana struck by a Maryland registered vehicle.
      It is therefore ordered that the limitations shall be amended to provide coverage for Maryland residents in out-of-State accidents.”
      We do not pass upon the validity of that order. Our decision in the subject case has been influenced in no way by its passage.


author: Davidson, J.,

text:
    STEUART INVESTMENT COMPANY v. BOARD OF COMMISSIONERS, ST. MARY’S COUNTY, MARYLAND et al.
    [No. 1079,
    September Term, 1976.]

      Decided January 10, 1978.

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

      Oliver R. Guyther and Norman M. Glasgow, with whom were Robert V. Smith, Alfred H. Carter, John F. McCabe, Jr., and Wilkes & Artis on the brief, for appellant.

      Amicus curiae brief filed by James F. Vance in behalf of Potomac River Association, Inc.

      Joseph Ernest Bell, II, County Attorney, for appellees.
   Davidson, J.,

delivered the opinion of the Court.

The appellant, Steuart Investment Co. (Steuart), is the owner of 397 acres of industrially zoned land at Piney Point, St. Mary’s County, on which since 1950 it has operated an oil storage facility, a permitted use, now containing 26 storage tanks. In August, 1975, as a prerequisite to the issuance of building permits for the construction of additional tanks identical to four existing tanks, Steuart submitted a site plan for approval. Steuart also submitted a report from a civil engineer to show compliance with the Zoning Ordinance. After holding hearings and requiring Steuart to file grading and soil sedimentation control plans and to upgrade the fire protection system, the Technical Evaluation Committee (TEC) approved the site plan. After hearings, the Planning Commission recommended approval of the site plan with a “stipulation that all Federal, State and County regulations and Ordinance requirements be met prior to the expansion of operation of the additional tanks; and that the appropriate agencies be requested to provide results of any evaluation and approvals as may be forthcoming.” Subsequently, the Planning Commission indicated that in its opinion “all regulatory requirements are currently satisfied as prerequisite to site plan approval.”

Notwithstanding that neither article 9 nor article 14 of the Zoning Ordinance requires a showing that the proposed facility does not lie within a fifty-year flood plain, on 8 January 1976, Steuart, in answer to a request from the Board of County Commissioners (Board), provided information showing that its facility was not so located. On 16 January 1976, in answer to a request from the Board regarding ambient water and air quality at the Piney Point facility, Steuart explained that the earthen dike surrounding each tank prevented water pollution and that measurements of the air quality would be meaningless because there were no State standards for hydrocarbon emissions.

On 4 February 1976, the Board determined that “additional, objective data is needed to ultimately decide whether to approve or disapprove the site plan as proposed.” In a letter dated 5 February 1976, it asserted that there was:

“a lack of data which might be properly termed probative evidence to substantiate an allegation that all requirements of the Zoning Ordinance have been met. Specific reference is made to Article 9.3 ‘Performance Standards’, A-J. While it is true that some such data has been supplied by the applicant and additional data has been assembled from federal and state agencies by Mr. Richard Platt, at the direction of the Planning Commission, it does not comply fully with the scope and intent of Article 9.3J.”

Notwithstanding the fact that the uncontradicted evidence showed that “the proposed tank expansion would not increase through-put,” the Board found that “the fact that the proposed expansion represents a substantial increase in capacity would on the surface, at least, make such testimony inconsistent.” It determined that the “impact upon the loading and unloading facilities and operating procedures” resulting from a “potential for increased through-put of petroleum products” had “not been addressed.” The Board concluded that:

“an environmental impact analysis is needed to objectively decide in this matter. Such analysis should:
“(1) Be paid for by the applicant. This is a reasonable expectation in that under the terms of the Zoning Ordinance, it is the burden of the applicant to show that any proposed establishment or expansion of an industrial use is in conformance with the performance standards of the Ordinance.
“(2) Be performed by a firm of the Board of County Commissioners’ choosing and directed by the Board of County Commissioners. The applicant and the St. Mary’s County Environmental Committee shall be allowed to review the credentials of any proposed firm and comment on same prior to final selection.
“(3) Be organized in such a fashion that will identify each requirement of the Zoning Ordinance and address same by providing probative evidence relative to each requirement.
“(4) Devote particular and concerted attention to the loading and unloading facilities and operating procedures — both from ' the standpoint of what exists and what might be required if the proposed expansion increases through-put. This phase of the analysis should include a determination of what the ‘technological state of the art’ is with respect to loading and off-loading petroleum and containment of spills; and should further compare Steuart’s operating procedures and facilities to such.
“The Board of County Commissioners should like to assure the applicant that it shall not act in an arbitrary and capricious manner in this case, but rather shall base its ultimate approval or disapproval on the objective data developed through the environmental impact analysis.
“The Board shall await your response to this letter and stands ready to promptly work out the details as to who shall perform the environmental impact analysis and the procedures by which same shall be accomplished.”

In a letter dated 4 March 1976, the Board submitted “draft-preliminary” specifications for the environmental impact analysis (EIA) to Steuart for review and invited Steuart “to discuss the matter further.” In a letter dated 26 April 1976, Steuart asked that the building permits be issued. The Planning Commission, pointing out that the requirements of the Zoning Ordinance and “the additional requirements and standards deemed necessary by the St. Mary’s County Commissioners ... have not yet been fulfilled,” said “your request is denied.” Steuart’s request for a reconsideration of the denial of its application was denied “[u]ntil such time as the County Commissioners authorize otherwise.”

In a letter to the Board dated 30 April 1976, Steuart, insisting that it had complied with all requirements of article 9, demanded that the building permits be issued. In a letter dated 6 May 1976, the Board wrote:

“The Board wishes to reiterate that its position is the same today as stated in [the letters of 5 February and 4 March 1976], Your demand that the site plan be approved and building permit issued within ten (10) days is therefore denied. The Board also wishes to reiterate its willingness to discuss the preliminary specifications for the environmental impact analysis so that the analysis may move forward.”

On 25 May 1976, in the Circuit Court for St. Mary’s County, Steuart filed a bill of complaint seeking, among other things, a writ of mandamus to compel the County to approve the site plan and issue the building permits. After oral argument, the trial court found, among other things, that: 1) the Zoning Ordinance authorizes the Board to approve industrial site plans; 2) the Zoning Ordinance authorizes the Board, even without a recommendation from the Planning Commission, to impose additional standards and requirements before approving an industrial site plan; and 3) the Zoning Ordinance contains sufficient guidelines to govern the imposition of those additional standards or requirements. We agree for the following reasons:

1) On 10 March 1977, the Zoning Ordinance was amended to include a specific authorization for the Board to approve site plans. Steuart concedes that the question of whether the Board has authority to approve industrial site plans is moot.

2) In interpreting a statute, the court must accord words their ordinary and natural signification. If the statute is part of a general statutory scheme or system, the sections must be read together to ascertain the true intention of the legislative body. Here the 10 March 1977 amendments establish a legislative intent to place ultimate responsibility for industrial site plan approval in the Board. This implies that the legislature intended the Board to have the right to take such reasonable action as it deemed necessary in order to fulfill its responsibility. Accordingly, the statutory provision which authorizes the Board to impose additional standards and requirements must be read as permitting the Board to exercise that function in a manner it deems appropriate independently of the recommendations of any other agency. Thus a Planning Commission recommendation is not required before the Board may impose additional standards or requirements.

3) When a legislative body delegates authority to administrative officials, it must establish adequate guides and standards, but such guides and standards need not be established when the legislative body itself is exercising the police power.* Here the Zoning Ordinance contains detailed standards which require that consideration be given to questions such as noise, vibration, smoke and particulate matter, toxic matter, odorous matter and glare. Additional standards and requirements which the Board may impose are limited to those “necessary for the maximum protection of the environment and health and safety of the citizens of the County.” These standards are adequate. Accordingly, the Zoning Ordinance is valid whether the action of the Board is legislative or administrative.

The trial court additionally found that the regulations that permit the Board to impose additional standards and requirements comply with the requirement that the regulations shall be uniform throughout each district, and that the Zoning Ordinance as applied did not deprive Steuart of equal protection. We agree.

Finally, the trial court rejected Steuart’s contention that the Board had imposed a requirement that an EIA be provided. It concluded that because the content of the EIA had not been agreed upon, no requirement had yet been imposed. Consequently, it did not reach the question of whether the alleged additional requirement was arbitrary and capricious. More specifically, it stated that the letters dated 4 March 1976 and 6 May 1976 invited Steuart “to discuss the contents” of the EIA specifications and that because of Steuart’s

“failure to accept [the Board’s] offer to discuss the preliminary specifications in a possible attempt to reduce or modify or eliminate them, [Steuart] has clearly not exhausted its administrative remedies as to any claim of arbitrariness regarding content of such proposals and will not be allowed to argue that point here. Because of [the Board’s] invitation to discuss the contents, the draft-preliminary copy was not an imposed requirement.” (Emphasis added.)

We do not agree.

Ordinarily, a court does not have jurisdiction in a case in which the protestant has not exhausted his administrative remedies. To exhaust administrative remedies, a person must pursue the prescribed administrative procedure to its conclusion and await its final outcome. Generally, resort can be had to a court only when there is a final order. Here the question presented is whether the Board had imposed a requirement that an EIA be provided so that its refusal to act on Steuart’s site plan in the absence of such an analysis was a final order.

A final order of a court has been characterized as a judicial determination which settles some disputed right or rights of the parties or denies a person further means of vindicating his rights and interests in the subject matter. While Maryland .courts have considered whether a particular administrative determination is a “final order,” the characteristics of such an administrative order have not been extensively articulated. With respect to the finality of administrative determinations, the United States Supreme Court has stated that:

“[Administrative orders are not reviewable unless and until they impose an obligation, deny a right or fix some legal relationship as a consummation of the administrative process.”

More recently that Court said:

“[T]he relevant considerations in determining finality are whether the process of administrative decisionmaking has reached a stage where judicial review will not disrupt the orderly process of adjudication and whether rights or obligations have been determined or legal consequences will flow from the agency action.”

We shall apply these criteria.

Here the record shows that the Board, in its letter of 5 February 1976, after its statement that “an environmental impact analysis is needed to objectively decide in this matter” of approval of Steuart’s site plan, indicated that it was willing to “work out the details as to who shall perform the environmental impact analysis and the procedures by which same shall be accomplished.” The Board’s letter of 4 March 1976 repeated its willingness “to discuss the matter further.” After Steuart demanded that the site plan be approved without an El A, the Board, in its letter of 6 May 1976, denied the demand and reiterated “its willingness to discuss the preliminary specifications for the environmental impact analysis so that the analysis may move forward.” This history demonstrates that although the contents of the EIA had not been agreed upon, the Board had determined that it would not act upon Steuart’s site plan without an EIA of some as yet undetermined content. Thus the Board’s action, as expressed in its letters, was to require an EIA as a prerequisite to site plan approval despite Steuart’s protest. The Board’s action imposed an obligation on Steuart to participate in the provision of the EIA and settled the disputed issue of whether an EIA was prerequisite to approval. The legal consequence of the Board’s action was that, unless and until the Board obtained an EIA, Steuart’s permit was, in effect, denied. Under all these circumstances, the Board’s letter of 6 May 1976 was a final order and Steuart had thus exhausted its administrative remedies with respect to the requirement of an EIA even though the contents of the EIA had not yet been determined. Accordingly, Steuart is entitled to judicial review of the question of whether, under the present circumstances, the Board was arbitrary and capricious in requiring an EIA.

With respect to judicial review of an administrative action alleged to be arbitrary or unreasonable, the Court of Appeals has said:

“The courts have been alert to exercise their residual power to restrain improper exercises of administrative powers whether judicial or legislative in nature. If the legislature has not expressly provided for judicial review, a court will ordinarily utilize its inherent powers to prevent illegal, unreasonable, arbitrary or capricious administrative action. In Heaps v. Cobb, 185 Md. 372, 379, this Court said: ‘The legislature is without authority to divest the judicial branch of the government of its inherent power to review actions of administrative boards shown to be arbitrary, illegal or capricious, and to impair personal or property rights; * * and then quoted the opinion in Hecht v. Crook, 184 Md. 271, 280:
“ ‘Courts have the inherent power, through the writ of mandamus, by injunction, or otherwise, to correct abuses of discretion and arbitrary, illegal, capricious or unreasonable acts; but in exercising that power care must be taken not to interfere with the legislative prerogative, or with the exercise of sound administrative discretion * * * *
“Administrative action may be arbitrary or unreasonable if it is not based on or supported by sufficient facts or proper factual inferences. The Court in Heaps at page 378 quoted the language of the Supreme Court in the Chicago Junction Case, 264 U. S. 258, 265, 68 L. Ed. 667, 674, that: ‘To refuse to consider evidence introduced, or to make an essential finding without supporting evidence, is arbitrary action, 'and added: ‘Administrative boards in general may be said to act in a quasi judicial capacity insofar as they have the duty to hear and determine facts and, based on them, to make decisions.
“Whichever of the recognized tests the court uses —substantiality of the evidence on the record as a whole, clearly erroneous, fairly debatable or against the weight or preponderance of the evidence on the entire record — its appraisal or evaluation must be of the agency’s fact-finding results and not an independent original estimate of or decision on the evidence----There are differences but they are slight and under any of the standards the judicial review essentially should be limited to whether a reasoning mind reasonably could have reached the factual conclusion the agency reached. This need not and must not be either judicial fact-finding or a substitution of judicial judgment for agencyjudgment____
“We hold that a court in reviewing legislative actions or decisions of an administrative agency may apply the weight of the evidence test to the factual findings of' the agency, without exercising nonjudicial functions, provided it does not itself .make independent findings of fact or substitute its jiudgment for that of the agency. . . .” (Footnote and citations omitted. Emphasis added.)

Thus the Court of Appeals has established that when an administrative agency, exercising either quasi-judicial or quasi-legislative power, hears and determines facts, and acts or makes decisions based upon those facts, a court, reviewing those acts or decisions, applies the weight of the evidence test. The court must determine whether a reasoning mind could have reached the factual conclusion reached by the agency. Administrative action is arbitrary and unreasonable if it is not based upon or supported by sufficient facts or proper factual inferences. Refusal to consider evidence introduced or making findings without supporting evidence is arbitrary action.

Applying these principles, the Court of Appeals has recognized that in the administrative process, the requested benefit must be granted if the record shows compliance with all the applicable prerequisites, and there is no evidence to the contrary. Because there would be no foundation of fact upon which to base denial of the claim, denial would constitute arbitrary and capricious action.

In Heaps v. Cobb, a widow’s claim for pension benefits under the Baltimore City Employees’ Retirement System was administratively denied. The trial court issued a writ of mandamus directing that benefits be paid and the Court of Appeals affirmed. Pointing out that testimony before the administrative agency had been uncontradicted, undisputed and unimpeached, that Court said:

“[T]he only conclusion to be reached is that the appellee has fully made out a case in compliance with every prerequisite of the ordinance, thus leaving no foundation of fact for the denial of her claim, and placing upon the appellant the mandatory duty of approving it.”

In State Health Department v. Walker, a property owner’s application for sewage disposal system permits was administratively denied. The trial court issued a writ of mandamus directing that the requested permits be approved and the Court of Appeals affirmed. Pointing out that the testimony before the administrative agency had been uncontradieted, undisputed by legally admissible evidence and,unimpeached, that Court said:

“The question presented to the court below was whether the Depai tment acted arbitrarily in disapproving appellee’s applications for sewage disposal permits. The Department defended its action on the basis that the soil and geological conditions of Walker’s locations rendered them unsuitable for subsurface discharge of waste effluent from septic tank systems. As the moving party, appellee sought to establish by his own expertise and that of the two Department employees, Dr. Waesche and Miss Schoolfield, that there was nothing about his sites that would, with the placement of sewage disposal systems thereon, create a hazard to health. It was incumbent upon the Department to prove just the opposite. For this purpose, Brown was called by the Department as its principal witness. Objections made by the appellee were sustained with respect to his giving an expert opinion concerning the soil and geological conditions of the two locations precluding a safe and proper operation of the desired installations.
.. Appellee alleged in his petition that despite the fact that his sewage disposal systems complied, in all respects with the applicable regulations, the Department refused without cause to approve his applications. The record before us discloses that the evidence presented in the lower court was ample to prove these allegations. Since the Department was unable to prove by legally admissible evidence that the systems did not meet the standards it imposed, its rejection of them must be either purely arbitrary or for reasons not related to its statutory function, and hence illegal. Decisions contrary to law or unsupported by substantial evidence are not within the exercise of sound administrative discretion, but are arbitrary and illegal acts.” (Citation omitted.)

With respect to the instant case, these cases establish that if the record contains probative evidence showing compliance with all applicable requirements and no evidence to the contrary, an administrative action which results in a denial of a requested permit is arbitrary and capricious.

Applying these principles to the instant case produces a clear result. The record extract indicates that Steuart submitted evidence from a civil engineer which showed or supported a rational inference that the proposed use would comply with all of the requirements of the Zoning Ordinance. After requiring Steuart to file grading and soil sedimentation control plans and to upgrade the fire protection system, the TEC approved the site plan. After hearings and after five county, seven state, and eight federal agencies had been contacted, the Planning Commission found that “all regulatory requirements are currently satisfied as prerequisite to site plan approval,” and approved the site plan. This probative evidence was sufficient to show compliance with the Zoning Ordinance. The record extract contains no evidence to show that the proposed expansion would not satisfy the requirements of the Zoning Ordinance. Under these circumstances, Steuart was entitled to approval of the site plan.

The Board, however, found that there was “a lack of data which might be properly termed probative evidence to substantiate an allegation that all requirements of the Zoning Ordinance have been met,” and that therefore an EIA must be provided to “identify each requirement of the Zoning Ordinance and address same by providing probative evidence relative to each requirement.” Given the uncontradicted probative evidence sufficient to show compliance, these findings were incorrect.

The Board found that an EIA was necessary to “[d]evote particular and concerted attention to the loading and unloading facilities and operating procedures —- both from the standpoint of what exists and what might be required if the proposed expansion increases through-put.” These findings were unjustified because they were unsupported by direct evidence or rational inference.

The fact that storage capacity would be increased is not necessarily inconsistent with the fact that through-put would not be increased. For example, the provision of additional storage might result in increased efficiency rather than increased through-put. Under these circumstances and given the pncontradicted evidence that through-put would not be increased, the fact that storage capacity would be increased does not support a rational inference that through-put would be increased.

Again, the record extract contains no evidence that Steuart’s existing operations failed to comply with all applicable regulations or that they had an adverse effect on the environment. More particularly, with respect to prevention and containment of oil spills, the record extract shows that the United States Environmental Protection Agency had approved the Spill Prevention Control and Countermeasure Plan developed by Steuart for its present facility and, in an inspection on 9 January 1975, had found that facility “to be in compliance with the existing plan.” The Maryland Department of Natural Resources had indicated that monthly inspections by the Enforcement Division of the Water Resources Administration showed that the existing facility met “all the requirements of the water pollution control law and regulation 08.05.04.07 — Prevention of Oil Pollution.” Moreover, the record extract contains no evidence to show a change in Steuart’s operating procedures and facilities other than the construction of the proposed storage tanks.

The Board, however, found that the EIA was required to determine “what the ‘technological state of the art’ is with respect to loading and off-loading petroleum and containment of spills; and should further compare Steuart’s operating procedures and facilities to such.” Under these circumstances, the Board’s finding was unjustified. Because the Board’s findings with respect to the necessity of an EIA were unsupported by facts or proper factual inferences, its action in imposing a requirement that an EIA be provided was arbitrary and unreasonable.

In addition, the Board’s action is arbitrary and capricious because it refused to consider the evidence introduced and relied upon by Steuart. The Board’s statement that it would “báse its ultimate approval or disapproval on the objective dat'a developed through the environmental impact analysis” established that the Board had determined to disregard all of the evidence before it, including that presented by Steuart, its own TEC, and its own Planning Commission, and to rely instead solely upon evidence to be presented by a firm paid by Steuart, but over which Steuart would have no control. In so doing, the Board substantially interfered with Steuart’s right to carry its burden of proof with evidence of its own choosing. The action of the Board was patently unfair.

The Board’s requirement that an EIA be performed as prerequisite to site plan approval was arbitrary and unreasonable. Accordingly, we shall reverse and remand for the entry of an appropriate order.

Order and decree reversed.

Case remanded for entry of an order consistent with this opinion.

Costs to be paid by appellees.

      . St. Mary’s County Zoning Ordinance (Zoning Ordinance), art. 9, § 9.4 B.3. (28 May 1974, as amended 10 March 1977).

      . Zoning Ordinance, art. 9 and art. 14. Article 9, § 9.2 E provides:
      “Site Plan. For every industrial structure and use erected, reconstructed, altered, or enlarged after the effective date of this Ordinance, a site plan shall be filed with the Zoning Administrator. No building permit shall be issued until said site plan is approved by the Planning Commission and the Board of County Commissioners. The Planning Commission may recommend and the County Commissioners may require additional standards and requirements to those stated in this Article as are necessary for the maximum protection of the environment and health and safety of the citizens of the County.”
      Section 9.3 provides a set of Performance Standards, including noise, vibration ana glare limitations, and smoke and particulate matter, toxic matter and odorous matter limitations. In addition § 9.3 J provides:
      “Conformance with State and Federal Regulations. The preceding regulations shall apply to the Industrial Districts of the County. The performance standards applicable to industrial uses will include all adopted air pollution, water pollution, noise, health or other relevant federal and state laws and regulations (see Article 48, Annotated Code of Maryland, 1957 edition and supplemented by Chapter 10.03.04, Regulations Governing the Control of Air Pollution in Area V).’ In addition, the County Commissioners may affix other conditions upon applicants for industrial zoning, including but not limited to those conditions outlined in this Ordinance, so as to protect the public health, safety, and welfare.
      “No use shall be established in an Industrial District after the effective date of this Ordinance which shall cause a violation of federal and state laws and regulations relating to air and water pollution, noise, health or other relevant laws and regulations. No use shall be established in an Industrial District after the effective date of this Ordinance which shall cause a violation of the conditions and standards affixed by the County Commissioners either by this Ordinance or by vote of the County Commissioners pursuant to the objective of protecting the public health, safety, and welfare.
      “The applicant for a grading permit, sedimentation permit, building permit for uses in an industrial zone, or applicants for industrial zone, exceptions to the zone, or variances to the zone shall be required to submit proof that the uses proposed will not cause violations of federal and state and county laws and regulations. For industrial uses which will produce emissions of pollutants to the waters and air of the county, this proof shall include measurements of the ambient water and air quality as well as documentation in the form of figures that the additional planned and proposed industrial use will not cause the violation of either ambient or source standards outlined by the laws and regulations of the federal, state and county governments.”
      Article 14, § 14.6 provides in pertinent part:
      “A. Zoning Administrator. The Zoning Administrator shall be responsible for checking the site plan for general completeness and compliance with such administrative requirements as may be established prior to routing copies thereof to reviewing departments, agencies, and officials. He shall see that all reviews are completed on time and that site plans are submitted to the Planning Commission within 45 days, except under abnormal circumstances, from the receipt thereof in his office. All site plans shall be submitted for consideration by the Planning Commission (and in the case of industrial site plans also to the Board of County Commissioners as consistent with Article 9.2E) after having been reviewed for completeness by the Zoning Administrator and appropriate County Departments,...”
      Section 14.16 provides:
      “The Planning Commission shall bo the approving authority for all site plans, except Industrial site plans which shall also require the approval of the Board of County Commissioners. Such approval shall be based on recommendation of the Zoning Administrator, County Engineer, and other appropriate agencies, and provisions contained in this Ordinance. The Planning Commission may delegate authority for specific site plan approval to the Zoning Administrator.”

      . St. Mary’s County Board of County Commissioners Res. 74-39 (16 October 1974).

      . The following agencies were contacted: Metropolitan Commission, County Engineer, Health Department, Soil Conservation, State Fire Marshal, Environmental Protection Agency (Air and Waste Management, Water and Hazardous Materials), Department of the Interior (Bureau of Outdoor Recreation, Fish and Wildlife Service, U.S. Geological Survey), Department of Commerce (National Marine Fisheries Service, Maritime Administration), Department of Health and Mental Hygiene (Bureau of Air Quality and Noise Control, Bureau of Community Health Protection), Department of Natural Resources (Energy and Coastal Zone Administration and Water Resources Administration), Maryland Geological Survey, Potomac River Fisheries Commission, Interstate Commission on Potomac River Basin, and Chesapeake Biological Laboratory.

      . The agencies generally indicated that they approved, that they had no comments, or that they had no applicable regulations. Only the Potomac River Fisheries Commission opposed.

      . Zoning Ordinance, art. 9, § 9.2 E, art. 14, §§ 14.6, 14.16.

      . “Throughput” is defined as “the amount of material put through the operations in processing in a given time.” Webster’s New International Dictionary (2d ed. 1957).

      . Zoning Ordinance, art. 9, § 9.2 E, art. 14, §§ 14.6, 14.16.

      . Mazor v. State, Dep’t of Correction, 279 Md. 355, 360-61, 369 A. 2d 82, 87 (1977); Subsequent Injury Fund v. State Roads Comm’n, 35 Md. App. 353, 355, 370 A. 2d 597, 598 (1977).

      . Zoning Ordinance, art. 9, § 9.2 E.

      . Zellinger v. CRC Dev. Corp., 281 Md. 614, 622-23, 380 A.2d 1064, 1069 (1977); Gino’s of Maryland, Inc. v. Mayor of Baltimore, 250 Md. 621, 640-41, 244 A. 2d 218, 229 (1968); LaRoque v. Board of County Comm’rs, 233 Md. 329, 335-36, 196 A. 2d 902, 904-06 (1964).

      . Zoning Ordinance, art. 9, §§ 9.2 E, 9.3.

      . Governor v. Exxon Corp., 279 Md. 410, 440-41, 370 A. 2d 1102, 1119 (1977); Montgomery County v. Walsh, 274 Md. 502, 523-24, 336 A. 2d 97, 110-11 (1975), appeal dismissed, 424 U. S. 901 (1976); Gordon v. Comm’rs of Montgomery County, 164 Md. 210, 213-14, 164 A. 676, 678 (1933); Tighe v. Osborne, 150 Md. 452, 457-58, 133 A. 465, 467 (1926).

      . Zellinger v. CRC Dev. Corp., 281 Md. 614, 620-23, 380 A. 2d 1064, 1068-69 (1977). See Montgomery County v. Woodward & Lothrop, Inc., 280 Md. 686, 719-20, 376 A. 2d 483, 501-02 (1977).

      . State Dep’t of Assessments & Taxation v. Clark, 281 Md. 385, 403, 3807A. 2d 28, 37-38(1977); Comm’n on Medical Discipline v. Bendler, 280 Md. 326, 330, 373 A. 2d 1232, 1234 (1977); Verkouteren v. Supervisor of Assessments, 38 Md. App. 216, 219, 380 A. 2d 642, 643 (1977), Waller v. Montgomery County, 36 Md. App. 326, 330, 373 A. 2d 971, 973 (1977).

      . Shpak v, Mytych, 231 Md. 414, 418, 190 A. 2d 777, 779 (1963); 73 C.J.S. Public Administrative Bodies and Procedure § 41 b (1951).

      . Kay Constr. Co. v. County Council, 227 Md. 479, 489-90, 177 A. 2d 694, 699-700 (1962); Celanese Corp. v. Bartlett, 200 Md. 397, 409, 90 A. 2d 208, 214 (1952); 73 C.J.S. Public Administrative Bodies and Procedure § 189 (1951).

      . Steuart’s contention that the issue of exhaustion of administrative remedies is not properly before this Court is without merit. Because a court has no jurisdiction in a case in which the protestant has not exhaustedhis administrative remedies, that issue involves a jurisdictional question. Accordingly, it may be raised by this Court on its own motion. Comm’n on Medical Discipline v. Bendler, 280 Md. 326, 327 & n. 1, 373 A. 2d 1232, 1232 & n. 1 (1977); Md.-Nat’l C.P. & P. Comm’n v. Washington Nat’l Arena, 37 Md. App. 346, 350, 377 A. 2d 545, 547, cert. granted, (C.A., 22 November 1977); Waller v. Montgomery County, 36 Md. App. 326, 334, 373 A. 2d 971, 975 (1977); Maryland Rule 1085.

      . United States Fire Ins. Co. v. Schwartz, 280 Md. 518, 521, 374 A. 2d 896, 898-99 (1977).

      . See, e.g., Kay Constr. Co. v. County Council, 227 Md. 479, 490, 177 A. 2d 694, 700-01 (1962) (resolution of County Council granting reconsideration is not a final order); Celanese Corp. v. Bartlett, 200 Md. 397, 409, 90 A. 2d 208, 214 (1952) (decision that “if otherwise eligible, she is entitled to benefits” is not a final decision); Bogley v. Barber, 194 Md. 632, 640-41, 72 A. 2d 17, 20-21 (1950) (proper remedy is bill in equity to enjoin “enforcement of administrative action taken, not action feared but yet to be taken”; declaration that zoning reclassification would be reconsidered is not a final order); Big Vein Coal Co. v. Leasure, 192 Md. 435, 437, 64 A. 2d 563, 563-64 (1949) (order allowing claimant to amend his claim is interlocutory and not final); Great American Ins. Co. v. Havenner, 33 Md. App. 326, 332, 364 A. 2d 95, 99 (1976) (order or award by Workmen’s Compensation Commission in matter then before it, determining issues of law and fact, which grants or denies some benefit under Workmen’s Compensation law is final order); Flying “A” Service Station v. Jordan, 17 Md. App. 477, 480-81, 302 A. 2d 650, 653 (1973) (order entitled to review must be “an operative order which has the effect of granting or denying some benefit under the Workmen’s Compensation law.”).

      . Chicago & Southern Air Lines, Inc. v. Waterman Steamship Corp., 333 U. S. 103, 112-13, 68 S. Ct. 431, 437 (1948).

      . Port of Boston Marine Terminal Assn. v. Rederiaktiebolaget Transatlantic, 400 U. S. 62, 71, 91 S. Ct. 203, 209 (1970).

      . This question, although not decided by the trial court, will be decided here to avoid the expense and delay of another appeal to this Court. Maryland Rule 1085.

      . State Ins. Comm’n v. Nat’l Bureau of Cas. Underwriters, 248 Md. 292, 300-01, 309-10, 236 A. 2d 282, 286-87, 291-92 (1967).

      . See Dep’t of Natural Resources v. Linchester, 274 Md. 211, 225, 334 A. 2d 514, 523 (1975); Turner v. Hammond, 270 Md. 41, 55, 310 A.2d 543, 551 (1973); Rockville Fuel v. Bd. of Appeals, 257 Md. 183, 191, 262 A. 2d 499, 504 (1970); Montgomery County v. Merlands Club, Inc., 202 Md. 279, 292-93, 96 A. 2d 261, 267 (1953); Comm’r v. Cason, 34 Md. App. 487, 499-500, 368 A. 2d 1067, 1075 (1977); Anderson v. Sawyer, 23 Md. App. 612, 617, 329 A. 2d 716, 720 (1974), cert. denied, 274 Md. 725 (1975).

      . Cf. Aspen Hill Venture v. Montgomery County, 265 Md. 303, 317, 289 A. 2d 303, 310 (1972) (action of District Council refusing to rezone one tract and rezoning a nearby tract on the same facts held arbitrary and discriminatory); Polinger v. Briefs, 244 Md. 538, 541, 224 A. 2d 460, 461 (1965) (action of County Council in granting rezoning on basis of change where record was devoid of evidence of change held arbitrary and capricious).

      . 185 Md. 372, 45 A. 2d 73 (1945).

      . 185 Md. 872, 385, 45 A. 2d 73, 79 (1945).

      . 238 Md. 512, 209 A. 2d 555 (1965).

      . 238 Md. 512, 519-20, 528, 209 A. 2d 555, 559, 561 (1965).

      . See note 4 above.

      . State Health Dep’t v. Walker, 238 Md. 512, 523, 209 A. 2d 555, 561 (1965). See Turner v. Hammond, 270 Md. 41, 55, 310 A. 2d 543, 551 (1973); Rockville Fuel v. Bd. of Appeals, 257 Md. 183, 193, 262 A. 2d 499, 505 (1970); Miller v. Kiwanis Club, 29 Md. App. 285, 288-90, 347 A. 2d 572, 574-75 (1975); Anderson v. Sawyer, 23 Md. App. 612, 617, 329 A. 2d 716, 720 (1974), cert. denied, 274 Md. 725 (1975).

      . Indeed, in its brief, Steuart explained that the proposed “[a]dditional storage would reduce the number of unloadings and loadings required.”

      . Md. Nat. Res. Code Ann. 8-140,1 to 1417 (1974 and Cum. Supp. 1977).


author: Melvin, J.,

text:
    CHARLES MITCHELL CARTER v. STATE OF MARYLAND
    [No. 391,
    September Term, 1977.]

      Decided January 10, 1978.

    The cause was submitted on briefs to Thompson, Melvin and Wilner, JJ.

      Submitted by Alan H. Murrell, Public Defender, and Michael R. Nalloy, Assistant Public Defender, for appellant.
    Submitted by Francis B. Burch, Attorney General, F. Ford Loker, Assistant Attorney General, Richard D. Warren, State's Attorney for Wicomico County, and Robert A. Eaton, Assistant State’s Attorney for Wicomico County, for appellee.
   Melvin, J.,

delivered the opinion of the Court.

On April 5, 1977, Charles M. Carter (appellant) was convicted by the Circuit Court for Wicomico County (Pollitt, J. presiding without a jury) of escape. He was committed to the custody of the Division of Correction for a period of one year to run consecutive with the sentence he was then serving. Appellant now presents two questions for our review:

“1. Did the trial court err by denying Appellant’s motion to dismiss which alleged that Art. 27, § 139 (a) was unconstitutional?
2. Did the trial court err by denying Appellant’s motion for a judgment of acquittal because the evidence did not show that the alleged escape took place in Wicomico County?”

The record before us supports a finding that on August 28, 1976, appellant, who was properly confined to the Poplar Hill Correction Camp in Wicomico County, was assigned to a work release detail which was sent to Ocean City, in Worcester County, for the day. While in Ocean City, appellant escaped from the work detail. He was apprehended several months later in Baltimore City.

I

Md. Ann. Code, Art. 27, 700A (c) (1976 repl. vol.) provides inter alia, that:

“.. . If any prisoner released from actual confinement under a ‘work release’ plan shall wilfully fail to return to the place of confinement so designated at the time specified in such plan, he shall be guilty of a felony and, upon conviction, shall be subject to the penalties provided in § 139 of Article 27.”

As appellant was convicted of escape under Article 27 § 700A (c), he was sentenced pursuant to Article 27, § 139, which provides in subsection (a) as follows:

“If any offender or person legally detained and confined in the penitentiary or jail, or house of correction, or reformatory, or station house, or any other place of confinement, in this State, escapes he shall be guilty of a felony and on conviction by the Criminal Court of Baltimore City or by the circuit court of the county in which the escape takes place, be sentenced to confinement in the penitentiary, jail or house of correction for whatever additional period, not exceeding ten years, as the court may adjudge. The sentence so imposed shall be consecutive to the sentence under which the inmate was originally confined and may not be suspended. However, for escapes from the Maryland Correctional Institution — Hagerstown or the Maryland Correctional Training Center — Hagerstown or any juvenile institution which have not involved an assault, the sentence may not exceed confinement for three years.”

In his Motion to Dismiss Indictment, filed prior to trial, see Md. Rule 725 (b), appellant contended, inter alia, that Article 27, § 139 (a) is unconstitutional in that it denies him equal protection of the law. The basis for this contention is that the maximum penalty for escaping from the Hagerstown correctional facilities is three years, whereas the maximum penalty for escaping from any other place of confinement (e.g., the Poplar Hill Correctional Camp) is ten years. Appellant argues that the only distinction betweeen the Hagerstown facilities and the Poplar Hill Correctional Camp is geographic and that there is, therefore, no rational justification for imposing a potentially heavier penalty on Poplar Hill escapees.

In denying appellant’s Motion to Dismiss based on the alleged unconstitutionality of Article 27, § 139 (a) the trial judge stated:

“That question as far as this court is concerned is moot because this court has said on several occasions that we have accepted that 3-years maximum for escape not involving assault as applying to all penal institutions, even though the statute makes it apply only to Hagerstown.
So, assuming, without agreeing, that this is unconstitutional and discriminatory, it is not unconstitutional as applied to this case because this Court recognizes it as being a limitation. The motion is denied on that ground.”

While we cannot agree with the trial court that the question is moot (appellant has not served out his sentence), we think appellant lacks standing to raise the issue of the constitutionality of Art. 27, § 139 (a). As we perceive it, appellant’s argument is that Article 27, § 139 (a) denies him the equal protection of the law because he might have been sentenced to a term greater than the maximum allowable for an escape from the Hagerstown facilities. As noted above, however, appellant was in fact sentenced to a term of one year, which is below the maximum that anyone escaping from the Hagerstown facilities could receive. Thus, appellant suffered no actual injury. In other words, appellant has not shown that he was in fact treated differently from any individuals in the favored class (i.e., those escaping from the Hagerstown facilities). See National Union of Marine Cooks and Stewards v. Arnold, 348 U. S. 37, 41 (1954).

In Roberts and Schaefer Co. v. Emmerson, 271 U. S. 50, 55 (1926), the United States Supreme Court held that one challenging the constitutionality of a statute on equal protection grounds, “cannot rely on theoretical inequalities, or such as do not affect him, but must show that he is himself affected unfavorably by the discrimination of which he complains.” We do not think appellant has made such a showing.

Even if we assume that appellant had the requisite standing to challenge the constitutionality of Article 27, § 139 (a), we would nevertheless hold that the trial judge properly denied his Motion to Dismiss. While it is well settled that “[T]he cases applying the Fourteenth Amendment’s Equal Protection Clause have required that a statutory classification ‘must be reasonable, not arbitrary, and must rest upon some ground of difference having a fair and substantial relation to the object of the legislation. . .’ ”, Bowie Inn, Inc. v. City of Bowie, 274 Md. 230, 241, 335 A. 2d 679 (1975), it is equally well settled that “one who assails a legislative classification (on equal protection grounds) must sustain the burden of proving that it does not rest on any reasonable basis ...” Prince George’s County v. McBride, 268 Md. 522, 532, 302 A. 2d 620 (1973). In the instant case, appellant’s mere assertion that the only difference between the Hagerstown correctional facilities and-the Poplar Hill Correction Camp is geographic, simply does not sustain his burden of proving that the legislative classification does not rest on any reasonable basis. See Id. Appellant, for instance, has not affirmatively shown that there are no differences in the types of inmates housed at these institutions, or in the training that they receive. Absent such a showing, appellant has not overcome the presumptions which favor the constitutionality of a duly enacted statute. Broadway v. State, 23 Md. App. 68, 72, 326 A. 2d 212 (1974), cert. denied, 273 Md. 719 (1975).

II

Appellant next contends that the trial court erred in denying his Motion for Judgment of Acquittal because the evidence did not show that the alleged escape took place in Wicomico County where he was tried.

Pointing to the language of Article 27, Section 139 (a) which says persons accused of the crime of escape are to be tried in the county in which the escape takes place, the appellant argues that since he escaped while in Worcester County, Wicomico had no jurisdiction to try him.

Improper venue is a “defense or objection” which, under Md. Rule 725 (b), must be raised by motion before trial. McBurney v. State, 280 Md. 21, 33-34, 371 A. 2d 129 (1977); Kisner v. State, 209 Md. 524, 122 A. 2d 102 (1956). If the defense is not raised by motion before trial, it is deemed waived. Md. Rule 725 (b). In the instant case, appellant raised the issue of jurisdiction in his pre-trial motion to dismiss, but did not interpose the defense of improper venue. The trial judge was, therefore, correct in denying appellant’s motion for judgment of acquittal on the ground of improper venue as that defense had previously been waived.

Even assuming that the issue of venue was properly raised below and on appeal, we think venue was proper in this case. In Stewart v. State, 275 Md. 258, 340 A. 2d 290 (1975), the Court of Appeals said at p. 270:

“As a distillation of these decisions § 139 has come to be interpreted to mean that the crime of escape takes places either (1) in the county where the physical departure actually occurs, or (2) in the county where the institution is located, which is the ‘prisoner’s place of confinement’ and from which his ‘constructive’ departure occurs. Since the Legislature has elected, following these decisions, not to amend the statute, but rather has acquiesced in its judicial construction there is a strong presumption that the intention of the Legislature and the words used by it have been correctly interpreted and such interpretation should not be disregarded.”

The appellant having been tried in the county where the institution of his place of confinement was located, the requirement of venue was satisfied.

Judgment affirmed.

Costs to be paid by appellant.