author: Thompson, J.,

text:
    GEORGE UMANS et al. v. PWP SERVICES, INC. et al.
    [No. 162,
    September Term, 1981.]

      Decided January 7, 1982.

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

      Henry E. Weil, with whom were Belli, Weil & Jacobs on the brief, for appellants.

      James Robert Miller, with whom were Miller & Steinberg on the brief, for appellee PWP Services, Inc. John A. King, with whom was Patrick J. Attridge on the brief, for appellee Paul Moss.
   Thompson, J.,

delivered the opinion of the Court.

Parents Without Partners, Inc. (PWP), is a nonprofit corporation with membership limited to single parents. It provides programs and recreational activities geared to cope with the single parent home. George Umans, one of the appellants, became a member of PWP in 1964 and immediately became active within the organization. Soon thereafter he was elected president of the local chapter and later became a member of the local Board of Directors. In 1966, as the result of his experience in the field of insurance, Umans undertook to develop an insurance program for the members. The program was established and Umans served as manager and coordinator from 1966 to 1977. Prior to 1976 Umans had voluntarily contributed 5% of the gross premiums to PWP as an administrative allowance. In 1976, Umans proposed to establish a jointly owned insurance agency with PWP. This proposal by Umans culminated in an agreement on October 5,1977, which is the basis of this suit. By its terms, Umans was to be employed by PWP Plan Administrator, Inc. (Administrator), and was to operate the insurance program through PWP Services, Inc. (Services) a corporation for profit, solely owned by PWP. Umans and the Administrator assumed the duties described in the contract on November 1, 1977 and continued to manage the insurance program in a manner similar to that exercised prior to the execution of the contract.

Services was to be a profit making organization and would receive 5% of all gross premiums of insurance written by appellants, primarily for furnishing the computer list of members of PWP, so that insurance solicitations and other ministrations could be supplied. Appellants had the obligation under this contract to use their best efforts to procure and sell low cost and effective insurance programs of every type to the members of PWP. For their efforts it was agreed that they would receive all profit from the sale of insurance to PWP members, except for 5% of the gross premiums which was to be retained by Services. The Administrator had a duty to provide a quarterly accounting to Services; detailing the number of insurance plans, policies or coverages sold to the members of PWP, their regional councils and chapters, and of all monies received as a result of the sales. The quarterly reports were to ensure that Services would be aware of the fees to which they were entitled.

Appellants had a further duty to submit to Services an annual certified accounting showing all business conducted, policies sold and ministration fees due to Services. The parties agreed that the first quarterly accounting required by the contract of October 5,1977 would be made on January 30.1978, as the effective date of the contract was November 1, 1977. It was further agreed that quarterly accountings would be due every three months thereafter. Failure to comply with these or any other terms of the contract was expressly stated to justify a termination of the agreement.

January 30, 1978 came and went and no quarterly statement was provided by appellant or his corporation. The officers and directors of Services began to inquire as to its absence because they were unable to determine the monies to which they were entitled. Finally, on June 15,1978 appellant submitted a hand-written interim report which purported to cover the period from November 1,1977 to June 15.1978. Subsequently, a modified report was submitted for the period from November 1, 1977 through June 30, 1978. Finally, in 1978, a third report was submitted by appellant, which purported to cover the period from November 1,1977 to June 30, 1978 and which differed from the first two reports appellant submitted, insofar as profits and amounts due to Services were concerned. The first report showed gross premiums of approximately $258,000. The second report showed gross premiums of approximately $236,000 and the third report showed gross premiums of approximately $284,000.

Appellant agreed to employ Mr. James LaGrone, the certified public accbuntant for PWP, to prepare the annual audit due on June 30,1978. In August of 1978, Mr. LaGrone, together with Jeffrey Taxey, another certified public accountant employed by him, went to the office of appellant to make the annual report. After an examination of the books and records, Mr. LaGrone and his employee concluded that the bookkeeping and records maintained by appellant made it impossible to make an accurate certified accounting as required by the contract.

After receiving this report from Mr. LaGrone, the Board of Directors of Services met with the appellant in September 1978 to afford him an opportunity to explain the accounting problems existing in his operation of the insurance program. At this meeting appellant admitted that things were "messed up,” as a result of bookkeeping problems, but added that hopefully he could get things straightened out. Mr. Paul Moss, one of the appellees, who was the treasurer of Services, agreed to go to appellant’s office to try to straighten out his books and records and to determine how much money, if any, was due and owing Services. Mr. Moss spent all day Saturday and Sunday on an October 1978 weekend in appellant’s office and found, in addition to the problems that Mr. LaGrone had previously reported, that the monies collected for Services had not been originally deposited to the proper account, but had been placed in accounts belonging to the appellants. Mr. Moss also found a $20,000 difference in the first eight months’ report which appellants could not explain. The following morning Umans telephoned Moss and attempted to provide an explanation to the questions left unanswered over the course of the investigation.

At the November 4, 1978 meeting the Board considered the reports of Mr. LaGrone and Mr. Moss and the attempted explanations of the appellants. Included in their considerations was the statement by Moss that Umans may have misappropriated funds. A motion was thereafter made and passed to the effect that appellants had breached their contract by failing to furnish the quarterly reports and the annual report as required by the contract and that accordingly, the contract should be terminated. A letter to that effect was sent to the appellants on November 7, 1978.

Pursuant to the terms of the original contract, the Board of Directors elected to enter into an Extension Agreement which required appellants to operate the insurance program for an additional four month period, while they received proposals from other persons to operate the program. This four month period was later extended through June 30, 1979. Appellants agreed to these extensions and operated the insurance business during this period after the termination of the original contract of October 5, 1977.

Upon these facts, Judge John F. McAuliffe, sitting in the Circuit Court for Montgomery County, found that the appellants had breached the contract and that the appellees were not barred by estoppel or waiver from claiming the breach. Appellants allege the trial judge was in error in making both findings. Suffice it to say, we agree with the trial judge’s finding that the appellants breached the contract by failing to file proper quarterly reports and failing to furnish the required audit.

We also agree with the trial judge’s finding that there was no estoppel or waiver. The appellants argue and we agree that the existence of estoppel or waiver is a question of fact to be decided in each case. Bargale Industries v. Robert Realty, 275 Md. 638, 343 A.2d 529 (1975). In the instant case the trial judge found that there was no waiver or estoppel and our review of the record indicates that there was evidence to support these findings. Therefore, we cannot say he was clearly erroneous under Md. Rule 1086.

Jurisdiction

The appellants also sued Paul Moss for defamation and Moss and PWP with intentional interference with contractual relations. The trial judge granted Moss’ motion raising preliminary objection on the grounds of lack of jurisdiction over his person. Appellants here allege the trial judge erred. They contend that Moss is liable to suit under three provisions of the Maryland Long Arm Statute, Md. Cts. & Jud. Proc. Code Ann. § 6-103 (b) (1) (3) and (4):

"(b) In general. — A court may exercise personal jurisdiction over a person, who directly or by an agent:
(1) Transacts any business or performs any character of work or service in the State;
(3) Causes tortious injury in the State by-an act or omission in the State;
(4) Causes tortious injury in the State or outside of the State by an act or omission outside the State if he regularly does or solicits business, engages in any other persistent course of conduct in the State or derives substantial revenue from goods, food, services, or manufactured products used or consumed in the State;”

As this Court explained in McKown v. Criser’s Sales & Service, 48 Md. App. 739, 742, 430 A.2d 91 (1981):

"Application of the long-arm statute involves a two step process. First, it must be determined whether the language of the statute authorizes jurisdiction; second, because the Due Process Clause of the Fourteenth Amendment limits the power of a state court to render a valid personal judgment against a nonresident defendant, Kulko v. Superior Court, 436 U.S. 84, 91, 98 S.Ct. 1690, 56 L.Ed. 2d 132 (1978), it must be determined whether the exercise of jurisdiction, if authorized by the statute, would be consistent with Fourteenth Amendment Due Process. See, Mohamed v. Michael, 279 Md. 653, 657, 370 A.2d 551 (1977); Geelhoed v. Jensen, 277 Md. 220, 224, 352 A.2d 818 (1976). The two determinations are inter-related 'as it was the intent of the Legislature in enacting the long-arm statute to expand the personal jurisdiction of the courts to the extent permitted by the Fourteenth .Amendment,’ Mohamed v. Michael, 279 Md. at 657, and thus 'the reach of the statute will largely depend upon whether Maryland in personam jurisdiction may be asserted under the Fourteenth Amendment.’ Krashes v. White, 275 Md. 549, 559, 341 A.2d 798 (1975).”

In the instant case all of the facts before the court showed that Moss’ only contacts in Maryland were those as a corporate officer. Although the precise point has not been presented to the Maryland courts it appears that such acts do not subject one to personal jurisdiction. The rule seems to be all but universal. See Quinn v. Bowmar Publishing Co., 445 F.Supp. 780, 786 (D. Md. 1978):

"The Court need not reach the question of whether Campbell’s contacts with Maryland are sufficient in number under the statute, since Campbell was acting on corporate business during those meetings. Contacts as a corporate representative on corporate business do not give rise to personal jurisdiction over the individual. Wilshire Oil Co. of Texas v. Riffe, 409 F.2d 1277 (10th Cir. 1969); accord, Lehigh Valley Industries, Inc. v. Birenhaum, 389 F.Supp. 798 (S.D.N.Y. 1975), aff'd, 527 F.2d 87 (2d Cir. 1975).”

See also, Shaffer v. Heitner, 433 U.S. 186, 97 S.Ct. 2569, 53 L.Ed 683 (1977); Escude Cruz v. Ortho Pharmaceutical Corp., 619 F.2d 902 (1st Cir. 1980); Weller v. Cromwell Oil Company, 504 F.2d 927 (6th Cir. 1974); Wilshire Oil Company of Texas v. Riffe, 409 F.2d 1277 (10th Cir. 1969); Spelling-Goldberg Productions v. Bodek & Rhodes, 452 F.Supp. 452 (E.D. Pa. 1978); Quinn v. Bowmar Publishing Company, supra; Idaho Potato Commission v. Washington Potato Commission, 410 F. Supp. 171 (D. Ida. 1976); Lehigh Valley Industries, Inc. v. Birenbaum, 389 F.Supp. 798 (S.D.N.Y. 1975); But see, Chancellor v. Lawrence, 501 F.Supp. 997 (N.D. Ill. 1980).

The appellants’ reliance on Topik v. Catalyst Research Corporation, 339 F.Supp. 1102 (D.C. Md. 1972) is misplaced. Although the Court there held that the fiduciary relationship between shareholders and directors made for an exception to the universal rule, that exception is obviously not involved here. Also not involved here is another exception where the corporation and the individual are virtually one and the same as in Groom v. Margulies, 257 Md. 691, 265 A.2d 249 (1970) and Feldman v. Magnetix Corporation, 50 Md. App. 308, 437 A.2d 895.

Judgments affirmed.

Appellants to pay the costs.

      . The appellants in the present case consist of George Umans and his corporation, PWP Plan Administrator, Inc.

      . In connection with the hereinafter discussion of jurisdiction, it should be noted that this meeting was held in Cleveland, Ohio.

      . The agreement contained the following:
      "15. Accounting Quarterly. Administrator shall ensure a quarterly accounting of Services’s business, detailing the number of insurance plans, policies or coverage(s) sold to Parents Without Partners, Inc., Regional Councils, Chapters and/or members of same, and monies received as a result of same. Said accounting shall be filed with Services on March 30, June 30, September 30 and December 30.
      "16. Certified Accounting. Administrator shall annually, on or before February 15 of each year, submit to Services, at its office of record, a certified accounting, including balance sheet and profit and loss statement, detailing all financial transactions which involve, in any way, Services, Parents Without Partners, Inc., Regional Councils, Chapters and/or members, officers and directors of any of the aforesaid. Said accounting shall cover the twelve (12) month period immediately proceeding January 1 of each year. The cost of the certified accounting shall be paid by Administrator, not from Services’s funds, except should the cost exceed Two Thousand Dollars ($2,000.00). Any cost in excess of Two Thousand Dollars ($2,000.00)-shall be paid by Services from those funds to be retained by Services as set forth in Paragraphs 9, 10, 11 and 12.”


source: Caselaw Access Project

author: Liss, J.,

license: Public Domain

text:
    RADIO COMMUNICATIONS, INC. v. PUBLIC SERVICE COMMISSION OF MARYLAND et al.
    [No. 326,
    September Term, 1981.]

      Decided January 7, 1982.

      The cause was argued before Liss, Wilner and Weant, JJ.

      Thomas Waxier, Jr., with whom were Nora Winay, Peter W. Collery and Semmes, Bowen & Semmes on the brief, for appellant.

      James A. Pine, with whom was Daniel P. Gahagan on the brief, for appellee Public Service Commission of Maryland. Thomas S. Martin, with whom were John Henry Lewin, Jr., and Venable, Baetjer & Howard on the brief, for appellee Hawkins.
   Liss, J.,

delivered the opinion of the Court.

In 1971 the General Assembly of Maryland adopted an act designated as Chapter 543 of the Laws of Maryland which amended the Public Service Commission (hereinafter PSC) law to bring within the PSC’s jurisdiction all radio common carriers. Maryland Code (1957, 1980 Repl. Vol.) Art. 78, § 55A subsection (b) of the Act contains a "grandfather” clause which provides for the certification of all radio common carriers operating and licensed by the Federal Communications Commission (FCC) on July 1, 1971. Radio common carriers which provided mobile radio communication by either verbal radio contact or signal had previously been licensed only by the FCC. Upon qualification as a public service carrier, and upon application within ninety days of the effective date of the statute, all then operating carriers were authorized under the "grandfather” clause of the Act to continue their operation in the territory "professed to be served” on July 1, 1971. Distinguished from the position of the "grandfather” operators, any "proposed” radio common carrier which sought to operate in any of the "grandfather” territories or to extend its service into the established area of an existing certificated carrier was prohibited absent a showing and determination that the existing service was "inadequate to meet the reasonable needs of the public.” See Maryland Code, Art. 78, § 55A (d).

At the time of the enactment of § 55A there were six radio common carriers operating in Maryland, namely: Carl G. Smith d/b/a Smith Communications Service (SCS), predecessor in interest to one of the appellees herein, Hawkins Communications, Inc. (HCI); the appellant herein, Radio Communications, Inc. (RCI); American Radio-Telephone Services, Inc.; Contact, Inc.; Betty Bowen, d/b/a Salisbury Answering Service; and Modern Communications. All of the above named carriers duly filed applications for "grandfather” status pursuant to subsection (b) of the Act.

In its application filed on September 30,1971, SCS stated that it was "engaged in the operation of a radio common carrier system in the City of Baltimore and the counties of Baltimore, Anne Arundel, Howard, Harford and Carroll.” In an amended application filed beyond the statutory deadline of ninety days, SCS included a map indicating service to Baltimore City, the five original counties above mentioned, and four additional counties. RCI filed for a certificate in Baltimore City and twenty counties.

The PSC elected to conduct individual hearings on each of the six "grandfather” applications. In the course of the hearing on SCS’s application, the PSC received testimony from several witnesses, including one John E. Dettra, Jr., a radio engineer. He stated that the "reliable service area” of a radio common carrier was the area in which service is expected to have not less than a 90% reliability as plotted by a contour line known as 37 dbu (decibel units). RCI, in opposition to the testimony of Dettra, took the position that the 37 dbu contour was too restrictive and not supported by the language of the statute. The Commission ultimately adopted the "reliable service area” test advanced by Mr. Dettra in awarding all six "grandfather” certificates of necessity and convenience. SCS was awarded a certificate to serve Baltimore City and portions of Baltimore County, Anne Arundel County and Howard County.

RCI took exception to the PSC’s ruling and noted an appeal. The dispute between RCI and its four principal competitors was eventually resolved by the Court of Appeals in Radio Communications, Inc. v. Public Service Commission of Maryland, 271 Md. 82, 314 A.2d 118 (1974). In weighing the respective contentions of RCI and SCS as to the test to be applied in determining "grandfather” rights under the statute, the Court of Appeals concluded:

We read subsection (b) to say that those who assert "grandfather” status cannot obtain certification by merely "professing to serve” a given area or county. Subsection (b) provides for certification of a radio common carrier "engaged in the operation of any radio common carrier system . . . .” By obtaining certification, a carrier is expected ". . .to continue the operation ... in the territory professed to be served. . . .” (emphasis added). Thus, when the application of a subsection (b) radio common carrier professing to have served an area is challenged, that carrier must then prove that, in fact, it did serve that area, i.e., that on July 1, 1971, it was "engaged in the operation” of a radio common carrier system in each subdivision for which certification is sought. [Emphasis in original.] 271 Md. at 95-96.

As the territory claimed by RCI was arguably greater than had been allowed by the PSC, the intermediate standard adopted by the Court of Appeals, the case was remanded to the Commission for further proceedings in order for the PSC to determine the area actually being served by RCI at the time of the adoption of the grandfather clause. The events following remand were detailed in this Court’s opinion in American Radio-Telephone Service, Inc. v. Public Service Commission of Maryland, 33 Md. App. 423, 365 A.2d 314 (1976). Suffice it to say that this Court ultimately affirmed that RCI’s actual service area consisted of an area bounded by RCI’s interference contours, which included Baltimore City and all or portions of twenty of Maryland’s counties.

Prior to the decisions in American Radio, supra, but subsequent to the original decision in RCI v. PSC, supra, SCS transferred substantially all of its assets, including its certificate of convenience and necessity, to HCI. Upon joint petition by SCS and HCI, the PSC, on July 9,1975, approved and authorized the transfer.

On March 11, 1976, HCI, as successor in interest to SCS, filed a petition with the PSC requesting the Commission (pursuant to the authority granted it by Section 85 (d) of Article 78), to correct the error of law incorporated in its order in the original case, i.e., the adoption of the erroneous standard for determining "grandfather rights” as determined by the Court of Appeals in Radio Communications, Inc., supra. HCI also requested the PSC to grant it a certificate of convenience and necessity for the continued operation of its radio common carrier system in the territory which Smith Communications professed to serve in its amended application filed on September 20, 1971.

Over the objection of RCI, the hearing examiner of the PSC ruled preliminarily that the prior testimony in the case established an actual service area as of 1971, bounded by Sherwood Forest on the south, Gaither on the west, Hampstead on the northwest and Bel Air on the northeast. The examiner also concluded that HCI succeeded to all of SCS’s "grandfather rights” and was entitled to exercise "whatever rights SCS have asserted under its certificate of convenience and necessity.”

Proof of the alleged actual service in 1971 was offered by way of prefiled written testimony of the witnesses who testified at the original hearing. In addition, HCI produced several witnesses, primarily employees and the accountant of Mr. Hoffberger, SCS’s principal customer in 1971. The witnesses were permitted to testify that Hoffberger received service to the outer boundaries of his customer service area which included Street, New Windsor, Cooksville, Millersville and Arnold. Smith testified to radio carrier contact with businesses in Northeast, Georgetown, Kent Island, Deale and Annapolis. SCS logs of radio usage, which were required to be maintained under FCC regulation, had been destroyed by Smith after the transfer to HCI. On the basis of this testimony, the examiner concluded that Smith’s testimony with regard to additional areas was not corroborated and denied these territories to HCI.

The examiner issued a proposed order containing the following findings and rulings:

(1) a transferee under a grandfather clause may exercise his predecessor’s right to seek modification of a grandfather certificate; (2) § 85 (d) authorizes the Commission to modify its orders at any time; (3) HCI’s delay in filing its petition was neither unreasonable nor barred by the doctrine of laches; (4) SCS was engaged in rendering public communication service as of July 1, 1971; (5) Smith’s testimony did not sufficiently prove radio service to the additional areas claimed; and (6) the testimony of the other witnesses was sufficiently corroborated to prove service to the new area claimed. The examiner ordered that HCI be granted a certificate of convenience and necessity for the continued operation of a radio common carrier system in all of Baltimore City and portions of Anne Arundel, Baltimore, Carroll, Harford and Howard Counties as delineated by a contour connecting Street, Freeland, New Windsor, Cooksville, and Arnold. The area awarded coincided with the testimony of Sweeney, one of Hoffberger’s employees, and extended well beyond the 1971 testimony of Smith.

We have included, for the purpose of clarification, Exhibit A which compares the 1972 award of territory, the actual service area testified to in 1971, and the 1979 award as modified by the additional testimony received into evidence by the examiner.

The proposed rulings by the examiner were appealed to the PSC which affirmed the examiner by appropriate order. Thereafter, both RCI and HCI appealed the Commission’s order to the Circuit Court for Anne Arundel County. HCI sought certification in the greater area delineated by Smith’s additional testimony. The Circuit Court for Anne Arundel County affirmed the Commission’s order in all respects. Both RCI and HCI appealed. HCI subsequently dismissed its appeal and was designated the appellee in this case. RCI, as appellant, appeals the order of the Circuit Court affirming the order of the PSC. It raises three issues to be decided by this appeal:

I. Does Article 78, § 85 (d) authorize the reopening of a validly issued certificate of convenience and necessity?
II. May a transferee of "grandfather” rights seek a modification of the certificate of convenience and necessity of its transferor?
III. Was SCS’s certificate of convenience and necessity properly modifiable under the circumstances of this case?

I.

The basic question presented in this case is whether the PSC may, under the broad powers granted it by the Maryland Legislature, modify a legally erroneous decision, absent a timely appeal by a party or a request for a rehearing.

Section 85 (d) of Article 78 expressly vests the PSC with the power to modify its orders. It states:

All orders of the Commission shall take effect within such reasonable time as the Commission may prescribe, and shall continue in force according to their terms, or until vacated, suspended, modiñed, or superseded by further order of the Commission or by a court of competent jurisdiction. [Emphasis added].

As the Circuit Court noted in its memorandum and order "[u]nder Article 78, Section 85 (d) the Commission is empowered to modify any order, and no time limit is imposed upon which this modification may occur.”

It is clear to us that after this case had filtered its way through the lengthy and involved appellate process which culminated in American Radio-Telephone Service, Inc., supra, the Commission had before it the dual responsibility of correcting its error of law in its original order and determining the territory actually served when the "grandfather” clause became effective under the statute.

Appellant contends that the Commission erred when it permitted the introduction of additional testimony by the appellee to substantiate the actual area of service by SCS beyond that of Mr. Smith and his witnesses in 1971. It suggests that Article 78, § 86 is controlling. That section provides, in pertinent part, as follows:

(a) Application and action thereon. — Any party in interest may apply to the Commission for rehearing within 30 days after service upon it of a final order. Action on such application shall lie in the discretion of the Commission. If a rehearing is granted, the case shall be decided within 30 days after the case on rehearing is finally submitted.
(c) What facts may be considered; new order. — The Commission may consider on rehearing facts not presented in the original hearing, including facts arising after the date of the original hearing, and may by new order abrogate, change, or modify its original order.

The method for reopening a cause after final submission is set forth in Code of Maryland Regulations, Vol. XIX, 20.07.02.08.

Appellant contends that HCI was granted a rehearing rather than a modification of the original order and that no new evidence was required to correct the error alleged in the Commission’s original finding, and more importantly, that the statute and implementing regulations expressly prohibit the Commission from hearing such new evidence beyond the 30 day limit established by Article 78, § 86.

Appellee responds that the statute makes it clear that the Commission has the power to rehear any final order at any time on its own motion. Md. Code, Art. 78, § 86 (d). The Commission urges that the 30 day stricture imposed by the regulations is at the most directed at the parties involved in any proceeding before the Commission and it has the discretion to reopen any hearing and to permit such additional evidence as it finds to be appropriate. The Commission further argues that in allowing HCI to present additional evidence of actual service during the 1978 hearings, it merely extended to HCI the same opportunity it afforded the appellant upon remand by the Court of Appeals. Radio Communications, Inc. v. Public Service Commission, supra. See American Radio-Telephone Service, Inc., supra. The Court of Appeals recognized the appropriateness of permitting additional evidence in RCI when it stated:

Although RCI did endeavor to furnish the proof required by (b) [of § 55A], the Commission was preoccupied with the premise that the subsection (d) standard controlled. We think the case should be remanded to the Commission for further proceedings, including the introduction of such additional evidence as the Commission may require', in order that RCI may be afforded the opportunity of establishing in what areas it did actually provide service, and for which it seeks certification under subsection (b); and so that intervenors may have the opportunity to present contrary evidence. [Emphasis added]. 271 Md. at 96.

We conclude that there is an affirmative duty upon an administrative agency to correct a prior decision when, because of an error of law, a continued adherence to its erroneous decision would place a litigant at an unfair disadvantage. We said in Board of County Commissioners of Cecil County v. Racine, 24 Md. App. 435, 332 A.2d 306 (1975):

We conclude that where, as in the subject case, a condition is created whereby property similarly situated but owned by others, could be used for purposes that would be denied a prior litigant, the principle of res judicata should not apply to an erroneous determination of law by an administrative body. Any other course would approach, if it did not reach, a deprivation of constitutional dimension. In any event, unrelaxed application of the doctrine would constitute a manifest unfairness to Racine.
We are guided to our conclusion by the language used in a very recent decision of the Court of Appeals of Maryland, Criminal Injuries Compensation Board v. Joseph D. Gould, 273 Md. 486, 331 A.2d 55 (1975), wherein it was said at 521 [76]:
"Mistaken interpretation^] of law, however honestly arrived at, are held not to be within the exercise of sound administrative discretion and the legislative prerogative, but to be arbitrary and illegal.”
Perpetuation of illegality by an administrative body by inflexible application of the principle of res judicata is impermissible. [24 Md. App. at 452].

The Commission has the primary duty to supervise and regulate public service companies "to assure their operation in the interest of the public.” Md. Code, Art. 78, § 56.

II.

Appellant suggests that even if modification is available under § 85 (d) that the remedy here sought is impermissible under the principles delineating the scope of grandfather rights. "Grandfather rights” are considered exceptions to statutes and must be strictly and narrowly construed. McCauley v. Makah Indian Tribe, 128 F.2d 867 (9th Cir. 1942). While we have no quarrel with the substantive law as stated in these cases, we conclude that Germenko v. Public Service Commission, 226 Md. 295, 173 A.2d 362 (1961) is dispositive of the right of. SCI to transfer its grandfather rights to HCI. In Germenko, the Court of Appeals quoted with approval from Railroad Commission of Texas v. Rau, 45 S.W.2d 413 (Texas 1931):

[T]he right to a permit was a valuable right exclusive in the holder and subject to sale or transfer by him, even to one having no apparent connection with him, and that therefore the transferee could exercise his predecessor’s right under the "grandfather clause” to obtain the permit. [Emphasis added]. 226 Md. at 308.

Nor are we impressed with appellant’s argument that "to conclude that HCI acquired a grandfather right permitting modification of a previously determined actual service area would be to say that it acquired more in the transfer — than the transferor itself acquired.” We conclude that the Commission, prior to 1979, had never previously determined SCS’s actual service area. The Court of Appeals recognized in RCI, supra, that the record of the 1971 proceeding was incomplete because of the Commission’s preoccupation with the erroneous "reliable service area.” It solved that problem on remand by referring the matter back to the Commission and specifically approved the Commission’s taking such additional testimony as the Commission might find necessary to establish RCI’s actual service area. We find no abuse of discretion by the Commission in affording HCI the identical opportunity to introduce such additional testimony as the Commission found appropriate in determining SCS’s actual service area.

III.

Appellant finally contends that since SCS failed to appeal or seek a rehearing of the original order of the PSC in 1972 that SCS’s successor in interest, HCI, may not share the benefit of RCI’s successful appeal which established the "actual service area” as the area to which "grandfather” rights applied. See Harrison v. Robinette, 167 Md. 73, 173 A. 60 (1934).

We do not, however, find that this legal principle is necessarily dispositive of this appeal. We conclude that the Commission’s power to modify a legally erroneous decision to correct an injustice is grounded in the provisions of article 78 and the decisions of the courts. The power to modify is a sine qua non which permits the Commission to effectuate the legislative intent in the regulation of public utilities. Art. 78, §§ 1 and 56. Nor does the principle of res judicata necessarily restrict the latitude which is allowed to administrative tribunals in the determination of matters of law. Professor Davis, in discussing the applicability of res judicata to administrative bodies, said, in 2 Davis (1958), Administrative Law Treatise § 18.03 at 566:

The desire for repose on which res judicata rests relates primarily to findings of fact; repose on lively problems of law may even be affirmatively objectionable. A tribunal ought not to be barred from using trial-and-error methods of feeling its way into an undeveloped frontier of law and policy. Even when the principle of res judicata should be rigidly applied to findings of fact, some relaxation of its application to rulings of law may be indicated. Many factors may argue against conclusive effect of an administrative decision of a question of law — the function may be somewhat nonjudicial, law and policy may be in a state of flux, substantive reasons may require that the agency’s authority to protect the public interest should remain unfettered, the administrative procedure may not have been geared to a careful consideration of the question of law, the agency may have been poorly staffed for deciding the question, or the legislative intent may have been that the agency’s decisions of law should not be binding.

We find nothing in the record which required the Commission or the Circuit Court to find that HCI was equitably estopped from seeking modification of the Commission’s erroneous original finding. Following the Court of Appeals’ remand to the Commission of RCI’s application, the Commission permitted RCI to introduce additional evidence of actual service. The Commission’s decision following remand was issued on May 21, 1975 and affirmed by the Circuit Court and this Court on December 10, 1975, and November 3,1976, respectively. The validity of the Commission’s interpretation of the standard for “grandfather” certification as enunciated by the Court of Appeals in RCI was still in litigation when HCI filed its petition for modification on March 11, 1976. In addition, as the trial judge noted, "the Commission was not considering modifications until the Commission’s interpretation of the actual use standard was tested in court.” Under these circumstances we find nothing in the conduct of SCS or HCI which would render the modification of an admittedly erroneous legal decision inequitable or unjust.

We have considered the record in this case in light of the standards enunciated in § 97 of Art. 78. That section provides:

Every final decision, order, rule or regulation of the Commission shall be prima facie correct and shall be affirmed unless clearly shown to be (1) in violation of constitutional provisions, or (2) not within the statutory authority or jurisdiction of the Commission, or (3) made upon unlawful procedure, or (4) arbitrary or capricious, or (5) affected by other error of law, or (6) if the subject of review is an order entered in a contested case after hearing, such order is unsupported by substantial evidence on the record considered as a whole.

The Court of Appeals has held that an order of the Commission is prima facie correct and the burden is on those who seek to set it aside on appeal to show by clear and satisfactory evidence that there is illegality or unreasonableness. Baltimore Gas and Electric Co. v. McQuaid, 220 Md. 373, 152 A.2d 825 (1959). We conclude that the Commission, consistent with its treatment of RCI’s application on remand, appropriately exercised its discretion in permitting HCI to offer additional testimony in determining the actual service area of SCS and that there was substantial evidence sufficient to sustain the correctness of the Commission’s order granting a certificate of convenience and necessity to HCI, successor to SCS, for the continued operation of a radio common carrier system in the following areas: all of Baltimore City, and a portion of Anne Arundel, Baltimore, Carroll, Harford and Howard Counties, as delineated by a contour connecting Street in Harford County, Freeland in Baltimore County, New Windsor in Carroll County, Cooksville in Howard County and Arnold in Anne Arundel County, being the area designated as No. 2 on the map included in this opinion. We further find no error in the action of the trial judge in affirming the action of the Public Service Commission.

Order affirmed; costs to be paid by appellant.


text:
    ROBERT F. JORDAN v. LINDA S. JORDAN
    [No. 345,
    September Term, 1981.]

      Decided January 7, 1982.

    The cause was argued before Morton, Moylan and Liss, JJ.

      James J. Cromwell and Beverly A. Groner, with whom were Spriggs, Cromwell, Myers, Nicholson & Spire, P.A. and Groner & Groner, Chartered on the brief, for appellant.

      Jeffrey N. Greenblatt, with whom were Brodsky, Greenblatt & Renehan, Chartered on the brief, for appellee.
   Liss, J.,

delivered the opinion of the Court.

Robert F. Jordan and Linda S. Jordan, appellant and appellee, respectively, were married on June 15, 1963 in Hartford, Connecticut. In September of 1976 the parties separated voluntarily and on November 17, 1977, executed a separation and property settlement agreement, under the terms of which they agreed that the custody of their two minor sons, Christopher, born December 12, 1966, and Garrett, born August 31, 1972, was to be with the mother. The agreement provided, inter alia, for detailed visitation rights by the father and the mother agreed that the father was to have "free access and unhampered contact with the children.” The parties were subsequently divorced by a decree a vinculo matrimonii on April 28, 1978. The separation and property settlement agreement was merged into the divorce decree.

Both minor children thereafter resided with their mother in the former marital home in Potomac, Maryland. The appellant remarried and moved to Darien, Connecticut. Subsequently, Christopher had moved by his own request and by agreement of the parties to the custody of the appellant in Connecticut, while Garrett remained with his mother in Maryland. Although, as was perhaps to be expected, some friction arose in the implementation of the father’s visitation rights with the younger child, no serious problem occurred until September 1,1979, when the appellant filed a petition for custody of both minor children and for other relief including prayers that: (1) the Circuit Court for Montgomery County ratify the then existing custody of the minor child Christopher in the appellant; (2) the appellee be enjoined from removing either of the said minor children from their respective places of abode in Connecticut and Maryland except for the implementation of visitation rights until the matter of custody had been finally determined by the court; (3) the court pass an appropriate order as to visitation rights; (4) the court make an appropriate award for support of the minor children; (5) the court award the appellant counsel fees; (6) the case be advanced for hearing; and (7) the court grant the appellant such other and further relief as the court deemed just and proper. On the same date the bill of complaint was filed, the chancellor signed an ex parte order granting custody of Christopher to the appellant, enjoining the appellee from removing either of the children from their respective places of abode, except for visitation until the controversy had been finally adjudicated, and ordered the existing plan for visitation to continue.

On November 26, 1979, appellee filed an answer to appellant’s petition in which she prayed: (1) the court to dismiss appellant’s bill of complaint; (2) that the injunction and order of September 11, 1979 be dissolved; (3) that all costs and legal fees incurred by appellee be paid by the appellant; and (4) for such other and further relief as the court might deem just and proper.

On May 5, 1980 appellant filed a supplemental amended petition in which he requested the court to grant the relief prayed in the original petition and grant him custody of both minor children with appropriate rights of visitation reserved to the appellee. On October 14, 1980, after a series of hearings extending over a period of several months, the chancellor ordered that the injunction previously issued against the appellee be dissolved effective October 17,1980. Appellant noted an appeal on October 16,1980. On the same date appellant filed a petition to stay operation of the chancellor’s interlocutory order dissolving the injunction previously issued on September 11, 1979, pending the disposition of the appeal to this Court. An answer to this petition was filed by the appellee and the petition to stay was heard by this Court on October 17,1980. We ordered that the appellant’s motion to stay the chancellor’s order of October 14, 1980 dissolving the injunction previously entered against the appellee be granted with the additional provision that the stay remain in effect until the issues on appeal were resolved in this Court.

On October 31, 1980, the chancellor signed an order dissolving the injunction entered on September 11, 1979 (effective October 17,1980); granting custody of Christopher to the appellant; reserving reasonable visitation rights to the appellee; denying appellant’s request for change of custody of Garrett; allowing the appellee to move outside the United States with Garrett; permitting appellant visitation with Garrett both in and outside the United States; accepting the parties’ stipulation concerning support for the minor child; ordering the appellant to pay the appellee $2,225 as suit money; ordering the appellant to pay appellee $20,000 in counsel fees and court costs; ordering that the award of counsel fees and court costs be paid from appellant’s share in the proceeds of the sale of the marital home, when sold; and denying appellant’s petition for contempt. Appellant seasonably filed an appeal to this Court from the order of October 31, 1980. On December 2, 1980 a revised order was issued by the chancellor exactly duplicating the order of October 31, 1980, except that the trial court’s prior order of October 31, dissolving the injunction entered against the appellee on September 11, 1979, was made subject to this Court’s order of October 17,1980 that stayed the effect of the dissolution pending the resolution of the appeal to this Court. From the judgments as set out in the chancellor’s revised order of December 2, 1980 this appeal has been seasonably filed.

Appellant has raised five issues to be decided by this appeal:

I. Whether the chancellor erred as a matter of law when he awarded custody of Garrett Jordan to the appellee in the absence of any finding by the chancellor that such an award would be in the best interests of the child?

II. Whether the chancellor erred as a matter of law when he found that the appellant had not shown that a change of circumstances had occurred which justified the transfer of Garrett Jordan’s custody from the appellee to the appellant?

III. Whether the chancellor abused his discretion by keeping the custody of Garrett Jordan separate from that of his brother Christopher?

IV. Whether the chancellor abused his discretion when he awarded custody of Garrett Jordan to the appellee in a manner that drastically reduces, without justification, Garrett’s and appellant’s rights of visitation with each other and impinges harmfully on Garrett’s relationship with his brother Christopher, by allowing the removal of Garrett 8,000 miles away to South Africa?

V. Whether the chancellor erred in awarding an attorney’s fee of $20,000 to the appellee when (a) the only proof of any fee was in an amount almost $1,000 less than that awarded, (b) the amount of time billed was substantially inflated and (c) no part of the total fee was charged to appellee herself although her independent financial earning power was not disputed?

I., II., and IV.

We shall consider these three issues raised by this appeal together. Appellant concedes that he has the burden of showing that strong reasons exist for changing the child’s custody. See Vernon v. Vernon, 30 Md. App. 564, 354 A.2d 222 (1976). He also, at least tacitly, agrees that a custody determination by a chancellor below is not reversible unless against the manifest weight of the evidence or "clearly contrary” to the best interests of the child. See Feldman v. Feldman, 55 Mich. App. 147, 222 N.W.2d (1974). As Judge Digges said, in Davis v. Davis, 280 Md. 119, 372 A.2d 231 (1977):

[I]t is within the sound discretion of the chancellor to award custody according to the exigencies of each case, [citation omitted] and as our decisions indicate, a reviewing court may interfere with such a determination only on a clear showing of abuse of that discretion. [280 Md. at 125].

The reason why the chancellor is vested with such broad discretion is:

[B]ecause only he sees the witnesses and the parties, hears the testimony, and has the opportunity to speak with the child; he is in a far better position than is an appellate court, which has only a cold record before it, to weigh the evidence and determine what disposition will best promote the welfare of the minor. [Id., at 125].

The Court of Appeals reaffirmed the standards enumerated in Davis, supra, in Ross v. Hoffman, 280 Md. 172, 372 A.2d 582 (1977), wherein it said:

It is not enough that the appellate court find that the chancellor was merely mistaken in order to set aside the custody award. Rather, the appellate court must determine that the judicial discretion the chancellor exercised was clearly abused. [280 Md. at 186],

It is clear from our reading of the extensive testimony included in the several volumes of the record extract filed in support of this appeal that the appellant had no serious complaint concerning the care furnished Garrett by his mother until he was advised that the appellee was contemplating marriage to her fiancé and was proposing to move to South Africa with her husband and the child for a comparatively long period of time. It is not seriously contended that Garrett, at the time of the filing of the petition for custody, was not a happy, healthy, well adjusted child. At no point in the course of these long and drawn out proceedings has the appellant suggested that the mother is not a proper person to have the care and custody of Garrett. Appellant urges that the suggested removal of Garrett to South Africa is in and of itself a sufficient change in circumstances to justify a change in custody. We do not agree. This Court, in Sartoph v. Sartoph, 31 Md. App. 58, 354 A.2d 476 (1976) (Davidson, J.) discussed the circumstances under which a change in custody should be considered:

The custody of children should not be disturbed unless there is some strong reason affecting the welfare of the child. To justify a change in custody, the change in conditions must have occurred which affects the welfare of the child and not that of the parents. The reason for this rule is that the stability provided by the continuation of a successful relationship with a parent who has been in day to day contact with a child generally far outweighs any alleged advantage which might accrue to the child as a result of a custodial change. In short, when all goes well with children, stability, not change, is in their best interests. [Footnotes omitted]. [31 Md. App. at 66-67].

The burden is on the appellant, who affirmatively seeks action by the chancellor in changing the custody of the minor child, to show why the court should take that action, and, if he fails to meet that burden, the action should not be taken. See McAndrew v. McAndrew, 39 Md. App. 1, 382 A.2d 1081 (1978).

Appellant complains bitterly that the chancellor, in rendering his oral opinion, failed to mention that he was making his decision "in the best interests of the child” and that the failure to enunciate these magic words indicated that the chancellor’s decision was clearly erroneous. We do not agree. We note that we said in Hebb v. State, 31 Md. App. 493, 499, 356 A.2d 583 (1976):

Judges are presumed to know the law. Samson v. State, 27 Md. App. 326, 334, 341 A.2d 817, 823 (1975). See Schowgurow v. State, 240 Md. 121, 126, 213 A.2d 475, 479 (1965). Absent an indication to the contrary, we must assume that judges apply the law correctly to the case before them.

That the chancellor in this case was well aware of the legal nuances of this hotly contested custody battle is evidenced from a portion of his oral opinion in which he called attention to the original separation agreement between the parties. He noted that the separation agreement provided:

[T]he best interests and welfare of the parties’ children are of paramount consideration for both of them. They should make every effort to foster the respect and love of the children for each other and shall do nothing which in any way would estrange the children from the other party and each shall exert every reasonable effort to retain free access and unhampered contact between the children and each of the parties.

Although the chancellor did not specifically state in his opinion that his conclusion was based on what he perceived to be the best interests of the child, a review of the entire record extract and his lengthy opinion convinces us with unmistakable clarity that he was not clearly erroneous in his implicit application of the "best interest of the child” standard.

Appellant argues vigorously that the chancellor failed to give adequate consideration and weight to the testimony of appellant’s witnesses concerning the "horrifyingly un-American way of life” in the society of South Africa to which it was proposed to introduce young Garrett in his pre-adolescent years. Appellant charges that by his decision in this case, the chancellor erred because he implicitly held that the Union of South Africa, "a State whose governmental and legal system is utterly antithetical to that of the United States, is a fine place to bring up an American boy because he would enjoy material wealth there and because appellee’s fiancé approves of it.” We consider this attack on the chancellor a "cheap shot.”

The record extract amply demonstrates that the chancellor gave both sides in this dispute wide latitude in introducing into evidence the opinions of experts as well as other witnesses as to the kind of society which would be found in South Africa. That he weighed this testimony carefully is demonstrated by that portion of his opinion in which he stated:

I do not find from the testimony in this case that there is an effort on the part of Mrs. Jordan to eradicate the child from his American heritage. I find only for a limited period of time that Mrs. Jordan and perhaps her new husband, if she elects to marry him, will be living in the Union of South Africa whose policies I hardly approve of, but simply because I disapprove of them, that in and of itself is not sufficient reason for me to forbid her from taking the child to that state, and I expressly say in my order that her custody is not limited to her remaining in the United States, but that she may follow the dictates of her own happiness and marry if she so chooses, and she has custody of Garrett Jordan pending further order of this Court.
I find nothing of her action that is an attempt to deprive this child of his right to American heritage. I believe that she will see to it that this child remembers this country, remembers the teachings of our democratic republic, and that when he returns, as I fully anticipate he will, he will be back into step with the thinking, with the feeling, and with the teachings of his heritage. I do not believe that there is any particular danger that has been demonstrated by the evidence. There is nothing in the testimony of the expert witnesses that indicates that this child is going to be harmed by a sojourn that he has in South Africa. I think the most poignant part of the testimony of Mr. Carlson was that when he was asked how many white, and perhaps he should have been asked foreign bom boys of the age of eight years have been arrested for violation of the Terrorism Act, his answer was he knows of none, and this is a strawman that has been raised solely to panic the Court into feeling that his residence in South Africa is going to visit upon him an untold hardship, and his custody shall remain in the hands of Mrs. Jordan subject to the right of Mr. Jordan to have reasonable visitation, and that reasonable visitation I define as being no less than one month during every calendar year. That month to be during that portion of the year when he is having his vacation from his schooling. His father shall have the right of such further visitation as he may reasonably elect to have. He may visit him in South Africa. He may visit him by bringing the boy to the United States and having him for periods of time not interfering with his schooling and his other reasonable activities as he wishes during the course of the year. [Emphasis added].

Like the chancellor, we are not impressed by the sug-

gestion of possible physical danger to this young man during his sojourn in South Africa. In today’s world, if we permitted parents to take their children only to those countries of whose political systems we approve, or where no possible threat of violence could occur, we would probably have to limit travel to the regions of outer space and might even have to disqualify Potomac, Maryland and Darien, Connecticut.

We find no abuse of discretion by the chancellor in his decision to permit Garrett to move with his mother to Bryanston, South Africa. There was evidence in the case which, if believed, could have established that the standard of living, the religious, educational, athletic and medical facilities available in Potomac, Maryland and Bryanston, South Africa, were similar and clearly adequate and that there were many children of Garrett’s age with whom he could associate. Nor do we find any clearly erroneous application of the applicable legal principles.

The great weight of authority in this country permits a minor child to move freely with the custodial parent. In Hoyt v. Boyar, 5 F.L.R. 2135 (N.Y. Fam. Ct., Sullivan County, 1979, modified, 77 A.D.2d 685, 429 N.Y.S.2d 792 (1980), the court found that both parents were responsible, capable, and willing to provide a better than average life for their child. Under circumstances where the mother to whom custody had been previously granted desired to move to Puerto Rico with her new husband, the fact that the court could find no fault with the mother’s request was evident where the court stated:

Relocating as a result of remarriage, employment and the like cannot of itself render a parent to whom custody has been granted unfit and thereby constitute the basis for a modification of custody. See Matter of Susan "KK” v. Rudolpho "KK”, 39 A.D.2d 792 (3d Dept. 1972). [5 F.L.R. at 2135-6].

The Supreme Court of Connecticut had before it recently a case in which similar arguments were raised and answered in an opinion permitting the mother to remove the parties’ minor child to Italy. In Prescutti v. Prescutti, 6 F.L.R. 2795 (Conn. Sup. Ct. 1980), the father argued that if the child were permitted to live in Italy the consequences would be that: (1) the court would lose effective control over the child; (2) the child would be effectively expatriated and lose his right to be raised as an American; and (3) the father’s reasonable visitation would be rendered illusory. The Court noted that it had continuing jurisdiction over the minor child. Although the Court recognized that it was more cumbersome to control the situation where the custodial parent resided outside the country, the Court held that it would be inaccurate to say that in such cases the court loses all control over the child. The Court further held:

We do not believe that the difficulty of enforcing the present order or subsequent orders that may be made concerning the child is a sufficient ground upon which to conclude that the court abused its discretion in the award of custody where the best interests of the child are otherwise promoted by the award. [6 F.L.R. at 2796].

Similarly, the Supreme Court of Oklahoma, in Miracle v. Miracle, 360 P.2d 712 (Okla. 1961), decided that a mother should not lose her right to custody because she lived in Italy and her husband argued that it was in the child’s best interests to be reared in the United States and to receive the benefits of its history and ideals. The Court found that it could not "bottom” its judgment on what might happen in the future, but retained continuing jurisdiction to modify the order if necessary.

We note that in the case subjudice the appellee offered to permit Garrett to visit with his father and brother during all the 77 days he was not attending school and offered to defray one-half the cost of transportation. The fact that visitation would become more difficult does not amount to such a change in circumstances as would justify the chancellor in changing custody from the mother to the father in this case. See Alcorn v. Alcorn, 388 S.W.2d 578 (Ky. 1965), in which the court permitted the mother to remove the parties’ eight-year-old child to Okinawa. Accord, Byers v. Byers, 370 S.W.2d 193 (Ky. 1963), where the court refused to enjoin a mother from taking her two minor children (ages eight and eleven) to Johannesburg, South Africa. The mother in that case was planning to move in order to marry a native of Holland who was employed as a newsman in Johannesburg. See also Bolenbaugh v. Bolenbaugh, 89 S.D. 639, 237 N.W.2d 12 (1975), where the Court permitted the removal of the parties’ minor child to Scotland.

Appellant offers in support of his position the very recent case of Daghir v. Daghir, 441 N.Y.S. 2d 494 (1981). In that case the custodial mother was divorced from the natural father and was awarded custody of their three minor children (ages fifteen, thirteen and nine). The husband was granted visitation rights every Sunday from noon till 7 P.M. and two weeks in the summer. The divorced wife then married an employee of IBM who accepted a two-year work assigment in France. The custodial parent proposed to remove the children to France and the father argued that his right to meaningful visitation would be destroyed by his former wife’s efforts to accommodate an entirely unnecessary career choice by her new husband. The chancellor denied the father’s motion to restrain the removal of the children or in the alternative that he be granted custody, and issued an order increasing summer visitation to 30 days and reducing support payments by $4,000 which would, in the court’s view, permit the father to travel to France to see the children. By a 3-2 majority vote the appellate court reversed.

In stating its reasons for the reversal the Court said "so zealously do the courts guard the relationship between a noncustodial parent and his child that any interference with it by the custodial parent has been said to be 'an act so inconsistent with the best interests of the children as to, per se, raise a strong probability that the [offending party] is unfit to act as custodial parent.’ ” [Citations omitted]. [441 N.Y.S.2d at 496],

The Court went on to say:

That is not to suggest, of course, that a custodial parent must scrupulously avoid all conduct which may in any way affect, no matter how slightly, the other parent’s right of visitation. Custodial parents have rights as well. Among them is the right to remarry, and we recognize that the obligations of a new marriage may legitimately, if rarely, require even "a dramatic change of locale.” (Weiss v. Weiss, supra, p. 177, 436 N.Y.S.2d 862, 418 N.E.2d 377). The decision to bear children, however, entails serious obligations and among them is the duty to protect the child’s relationship with both parents even in the event of a divorce. Hence, a custodial parent may be properly called upon to make certain sacrifices to ensure the right of the child to the benefits of visitation with the noncustodial parent. The search, therefore, is for a reasonable accommodation of the rights and needs of all concerned, with appropriate consideration given to the good faith of the parties in respecting each other’s parental rights. [Id., at 496].

The Court then concluded:

On balance, therefore, we conclude that the Family Court’s determination unreasonably and unjustifiably interferes with Khalil’s right to meaningful visitation and is contrary to the children’s essential best interests. Because moving the children to France is not required by any compelling financial, educational, employment or health considerations, and because it would significantly curtail the frequency, and therefore the quality, of what was regular and welcomed visitation, the order appealed from should be reversed. (See Matter of Whittemore v. Whittemore, 202 Misc. 175, 109 N.Y.S.2d 216.) Khalil’s motion should be granted insofar as it seeks to modify the divorce judgment by adding a provision prohibiting the removal of the children from New York State for purposes of residing elsewhere, without his written consent, and insofar as it seeks a temporary transfer of custody, for so long as Frances shall reside outside of New York State. [Id., at 497].

While we cannot quarrel with the majority’s decision in this case we think the dissenting opinion as written by Justice Magnano and joined by Justice Rabin is more clearly in the interests of the minor children than the Hobson’s choice created by the majority. The dissent said, in pertinent part,

The order appealed from is fair and reasonable, and attempts a Solomonic solution to the instant dispute. It represents humane sensitivity to the competing interests and concerns of the parties. It abrogates no one’s rights, but alters their implementation so as to realistically respond to the changing needs of all. And, most importantly, it appears singularly guided by a desire to ensure the best interests of the children by preserving the stability of their relationship with their custodial parent, by maintaining significant contact between them and their noncustodial parent, and by allowing them to take advantage of expanding opportunities for growth and learning.
It must be emphasized that the custodial parent intended to move her family’s home temporarily to France because her present husband had made a career choice necessitating such a move. It may be true that this career choice was not dictated by any financial or promotional considerations. Nevertheless, the choice was made. The real question, then, is whether the wife must now choose not to accompany her husband in his temporary relocation in order to retain the custody of her children and maintain her former husband’s weekly visitation rights, or relinquish custody to the latter in order to fulfill her present marital obligations. This is an impossible choice, which should be avoided, if there can be a reasonable accommodation of the parties’ rights. I am convinced that the Family Court’s carefully fashioned order effected such an accommodation. [Id., at 498],

We were advised at argument that the appellee in this case has postponed marrying her fiancé pending the outcome of these proceedings. We think it would be cruel and inhumane to require her to choose between her child and her fiancé particularly when the exercise of true love for the child by both parties could provide an acceptable accommodation in their best interests and the best interests of the child.

III.

Appellant next argues that the chancellor abused his discretion by keeping the custody of Chris Jordan, the older brother, separate from that of Garrett, the child involved in this case. He cites the dictum in Hild v. Hild, 221 Md. 349, 359, 157 A.2d 442 (1960), wherein the Court of Appeals held:

Ordinarily, the best interests and welfare of the children of the same parents are best served by keeping them together to grow up as brothers and sisters under the same roof.

The short answer to appellant’s contention is found in the fact (which the chancellor had before him) that the brothers, by agreement of the parents, had been separated for a period of more than two years before the father filed his bill of complaint seeking custody of Garrett. The chancellor found that Christopher desired to remain in Connecticut with his father. He also found that in spite of the separation between himself and his father and brother, Garrett was "a well adjusted and thriving young man who seems to be doing very well living with his mother and visiting with his father and brother in Connecticut. There seems to be no physical, no mental, no emotional disability that Garrett has suffered and no demonstration that he will suffer such a disability visited upon him by reason of the fact that he will be living with and in the custody of the mother.”

So far as Christopher was concerned, there was testimony consistent with the six year difference in age between the brothers, that before the separation Christopher treated Garrett as a "tagalong.” There was no evidence that Garrett suffered any adverse effects during the two-year separation of the brothers. The chancellor had before him conflicting opinions offered by experts as to what effect, if any, the separation of the siblings would have on their relationship. Certainly, if appellant avails himself of the 77 days of visitation which is offered by appellee, the contact between the brothers may well be greater than that afforded by the present weekend visits. We find no abuse of the chancellor’s discretion.

V.

Finally, appellant contends the chancellor erred in awarding appellee’s counsel an attorney’s fee of $20,000 because: (a) counsel submitted proof of a fee in an amount of almost $1,000 less than that awarded; (b) the bill for time expended was inflated; and (c) no part of the fee was charged to the appellee.

Md. Ann. Code (1957, 1973 Repl. Vol.) art. 16, § 5A provides in pertinent part as follows:

In all cases where a person makes an application for a decree or modification of a decree with respect to the custody, the amount of support or visitation rights concerning a child or children of the parties, or files any form of proceeding to recover arrearages of child support or otherwise to enforce such decree, the court, after considering the fínancial status of both parties, their respective needs and whether there was substantial justification for instituting or defending the proceeding, may make such award of costs and counsel fees to either party as shall be just and proper under all the circumstances. [Emphasis added].

The question of the amount of counsel fees to be allowed was considered by us in Foster v. Foster, 33 Md. App. 73, 364 A.2d 65 (1976), where we said:

In determining the amount for a reasonable counsel fee, the ordinary factors of labor, skill, time and benefit, as well as the financial resources of the parties, must be taken into account. While time is one of the applicable factors, the record need not contain evidence specifically delineating the number of hours spent by counsel. Because the record itself discloses the nature of the proceedings, it is some evidence of the extent of the attorney’s efforts. Given this evidence, the chancellor may rely upon his own knowledge and experience in appraising the value of an attorney’s services. [Footnotes omitted]. [33 Md. App. at 77].

Based upon these guidelines and our independent review of the record extract we do not and cannot find that the chancellor erred in awarding a $20,000 counsel fee to the appellee in this case.

However, we are in a somewhat different position when we consider whether the appellee should have been required to bear some portion of the attorney’s fees. We find nothing in the record from which the chancellor could have determined what the financial status of the parties was, or from which their respective needs could have been assessed. We have no difficulty in concluding that there was substantial justification for instituting and defending the proceedings. We shall therefore affirm the chancellor’s order as to all issues except that we shall remand for a further hearing to determine whether the appellee shall be required to bear some portion of the counsel fees allowed in this case.

Portion of order as to award of counsel fees vacated and remanded for further proceedings.

Remainder of order affirmed.

Costs to be paid by appellant.

      . Maryland law is precisely the same. See Glading v. Furman, 282 Md. 200, 383 A.2d 398 (1978); Seidlitz v. Seidlitz, 23 Md. App. 327, 327 A.2d 779 (1974).


author: Moore, J.,

text:
    MAYOR AND CITY COUNCIL OF BALTIMORE v. OHIO CASUALTY INSURANCE COMPANY et al.
    [No. 387,
    September Term, 1981.]

      Decided January 7, 1982.

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

      William R. Phelan, Jr., Assistant City Solicitor of Baltimore, with whom were Benjamin L. Brown, City Solicitor of Baltimore and J. Warren Eberhardt, Assistant City Solicitor of Baltimore, on the brief, for appellant.

      Lee H. Ogburn, with whom was Andrew Jay Graham on the brief, for appellee Athens General Contractors, Inc. Robert Phillip Thompson on the brief for appellee G & M Painting Co., Inc. George J. Bachrach on the brief for appellee Ohio Casualty Insurance Company, Inc.
   Moore, J.,

delivered the opinion of the Court.

The principal questions in this appeal from an order that the City of Baltimore pay the remaining sum due on a masonry contract arise from the denial by the Superior Court of Baltimore City (Greenfeld, J.) of the City’s motions for summary judgment, directed verdict, new trial and/or judgment n.o.v. The questions are:

1) Should a contract between a municipal agency and a private company be interpreted more strictly than ordinary private contracts?
2) Was the City’s dispute with the contractor resolved by arbitration binding on the parties?

The appellants also allege error in the trial court’s instructions; however, such error is predicated on appellant’s substantive arguments. Since we find those arguments unpersuasive, for the reasons stated herein, we shall answer both questions negatively, endorse the court’s instructions as proper, and affirm the result below.

I

The G & M Painting Company was awarded a $34,900 contract by the Department of Education to clean, cut, point, and waterproof the 1916 brick building known as School No. 214 in Baltimore. G & M, after sandblasting the building and starting the cutting and pointing of the mortar joints, subcontracted the work to Athens General Contractors, Inc., with the approval of the Project Supervisor, William A. Gieseking, who was named in the contract as the Assistant Superintendent’s Representative. The contract called for the old mortar between the bricks to be cut out to a depth of 3/4 of an inch and new mortar troweled in, "unless approval of the Department of Education is granted in cases where a depth this great is not feasible in the interest of a first-class job.”

During the cutting, the City’s inspector, Aaron S. Powell (since resigned), noticed that bricks were sagging in some places, particularly on the northwest side of the building which contained a "knock-out panel,” a 540 square foot area of face veneer brick which could be easily removed to provide access to the school’s heating system. The solution to this problem was disputed. Mr. Gieseking testified that he told Athens to cut to a depth of 1/2 inch only in the "knock-out” area. Mr. Powell says Mr. Gieseking told Athens to "cut only where necessary.” The upshot was that only about half the brick surface was cut to 3/4 of an inch, about 35 percent was cut to 1/4 of an inch, and the rest was not cut at all. After the work was completed in July 1975, and partial payment of $22,500 was authorized by Mr. Gieseking, some of the "skim pointing” peeled off, resulting in an unsightly facade.

Mr. Gieseking sent two letters to the contractors in September 1975, requesting that half the brick work be recut and repointed but he received no reply. Through the "bad weather” months no further action was taken. On April 22, 1976, the Assistant Superintendent, Curtis E. Lantz, wrote a "Notice of Intent” letter to the contractors, giving them three days to resume cutting and pointing the bricks or be found in default under the terms of the contract. The following March, the Ohio Casualty Insurance Co., Inc., the surety under the original contract, filed a declaratory judgment action against the City of Baltimore. In April 1977, Athens and G & M filed cross-claims. On March 13,1979, the City filed a separate action on the contract against all three parties. The consolidated cases were tried before a jury. A premature appeal from the verdict against the City was dismissed sua sponte by this Court on October 21,1980. Subsequently, a Final Order resolved all claims and this appeal followed.

II

Appellant’s first contention that public contracts require stricter judicial construction than private contracts rests on no cited cases; and we have found none. Indeed, only last year the Court of Appeals stated:

"The rules which govern the construction of contracts between individuals and private corporations also govern the construction of contracts between individuals and municipalities.”

Anne Arundel County v. Crofton Corp., 286 Md. 666, 673, 410 A.2d 228 (1980). See also City of Frederick v. Brosius Homes Corp., 247 Md. 88, 92, 230 A.2d 306 (1967).

Appellant’s reliance on Gontrum v. Mayor of Baltimore, 182 Md. 370, 35 A.2d 128 (1943) and its progeny, Inter-City Land Co. v. Baltimore County, 218 Md. 80, 145 A.2d 263 (1958), and Kent County v. Abel, 246 Md. 395, 228 A.2d 247 (1967), is an example of trying to make bricks without straw. The Gontrum case reiterated the hoary principle that a municipal corporation cannot be held liable for the unauthorized acts of its agents, absent some ratification or adoption. 182 Md. at 376. As the trial court in the instant case pointed out, the cases supporting that proposition involve a statute or ordinance that specifically vests power in a named public official. Judge Greenfeld stated:

"I do not perceive this contract to fall in that category. The authority vested in the assistant superintendent is not one vested by law. In other words, the law does not say that only the assistant superintendent can make modifications or changes in the contract. The assistant superintendent gets his authority from the governing body of the city under that governing body’s general powers.
"On that basis . . . this contract comets] under the normal rules applicable to contracts generally. . . .
"Secondly, I would note that the assistant superintendent, himself, testified that he actually has no contact with the implementation of this contract. He never undertook, during the administration of the project, to do any of the acts that were given to him in the written contract itself. He delegated those acts to people under him, to his subordinates; so even by the assistant superintendent’s own procedures, people other than himself were given the power that the contract gives to him, alone.
"In addition to that, the City was quite willing to permit Mr. Gieseking to approve the assignment of the contract from G & M to Athens. The assistant superintendent was never even consulted about that and never expected to be consulted about that.
"The sum and substance of all this is that the assistant superintendent never undertook to do the things that the contract says only he was entitled to do, by his own act.”

Appellant’s argument that the City of Baltimore’s Charter somehow casts in concrete the terms of this contract collapses in a careful reading of Article VI, § 4 (b) and (g) (1964). These provisions cited by appellant cover the powers of the Board of Estimates in the bidding process and the bonding duty of the successful "lowest, responsible bidder.” There is nary a word about implementing or interpreting the contract itself. The provisions are also silent on the subject of changes in the contract. Appellant’s strained interpretation of the City’s Charter is no foundation for its novel legal theory that municipal contracts are immovable monuments.

Finally, oral modification of a contract, despite a provision requiring all modifications to be in writing, is permitted in Maryland. University National Bank v. Wolfe, 279 Md. 512, 522, 369 A.2d 570 (1977). Hoffman v. Glock, 20 Md. App. 284, 288, 315 A.2d 551 (1974). We see no reason to make any exception for municipal contracts. While the contract in this case did require that all changes be effected in writing, modification of the cutting depth was necessary to forestall a "walls come a-tumblin’ down” result. At no time during trial did appellant contend that no change was ordered. The factual dispute concerned the extent of the modification, and that was for the jury to resolve. We see no reason to disturb their decision.

Ill

The second question is whether the contractors are bound by the "decision” of the assistant superintendent as "arbitrator” that they were in default. A provision in the contract states that the Assistant Superintendent shall decide all questions and disputes and his determination shall be final and conclusive. While this contract language is similar to that interpreted in Nelley v. Mayor of Baltimore, 224 Md. 1, 166 A.2d 234 (1960), but see Joseph F. Trionfo & Sons v. Ernest B. LaRosa & Sons, 38 Md. App. 598, 381 A.2d 727, cert. denied, 282 Md. 734 (1978), the record in this case discloses no attempt to comply with Md. Cts. & Jud. Proc. Code Ann. §§ 3-213 and 214 a. (1957,1980 Repl. Vol.). No notice of an arbitration hearing was sent, no adversarial hearing was held, no evidence was received, and no arbitral decision was made. See Seldner Corp. v. W. R. Grace & Co., 22 F.Supp. 388 (D.Md. 1938).

The City attempts some "skim pointing” of its own by arguing that a letter to the contractors on April 22, 1976, was notice of an arbitration decision and that several meetings between its representatives and the contractors were in fact a proper arbitration hearing. As appellee notes, the letter follows the wording of the contract provision entitled, "Annulment of Contract,” under which the Assistant Superintendent may, upon three days’ notice, declare the contract in default and hire another contractor to take over and finish the job. In Nelley, supra, upon which appellant relies, the meeting sought by the contractor to press his claims for additional compensation was "evidently in the nature of a hearing.” 224 Md. at 5-6. Two days later, the contractor was informed of the arbitrator’s decision "[ajcting in pursuance * * * [of his] power and authority as referee under the contract, . . .” Id. at 6. There is no such language or understanding in the instant case.

Appellant’s reliance on Mayor of Baltimore v. Allied Contractors, Inc., 236 Md. 534, 204 A.2d 546 (1964), and J. A. La Porte Corp. v. Mayor of Baltimore, 13 F.Supp. 795 (D.M. 1936), is misplaced, as shown by the factual settings of those cases. In the former, both sides had agreed to arbitration under the contract which stated that the Director of Public Works of Baltimore "will be the referee,” 236 Md. at 538, and a series of meetings had taken place,” culminating with two full days of investigation . . . during which each claim was checked in detail.” Id. at 539. The issue was not whether arbitration had occurred, as in this case, but rather, whether the arbitrator’s decision was binding on the City. Considering all the circumstances, the Court said, "the conduct of the parties questionably indicates that the meeting . . . was intended to be a final arbitration of the damages claimed.” Id. at 545.

In La Porte, supra, the contract provision analogous to the one in this case contains an additional phrase that, in effect, allows the Chief Engineer to construe the terms and conditions of the contract. 13 F.Supp. at 797. Appellants correctly analyze that case to conclude that such provisions "have the effect of the award of an arbitrator, and . . . "are conclusive and binding upon the parties.” Id. at 798. However, the case is inapplicable to the present controversy, simply because in La Porte there was an arbitration (although the arbiters could not agree) and here there is none. The instant contract specified cutting to 3/4 of an inch, "unless ... a depth this great is not feasible. . . .” The contract specification was orally modified by the Assistant Superintendent’s Representative, Mr. Gieseking. The extent of the modification was disputed and the dispute was resolved by the jury. In the entire record, there is no hint of any arbitration. Thus, the Assistant Superintendent’s letter warning of default could not also serve as an arbitration award.

IV

Four of the appellant’s prayers for instructions were denied by the trial court and appellant excepted to one of the instructions given. All the exceptions were based on the contentions advanced by appellant in support of the first argument in its brief. We have rejected these contentions. Thus, the trial judge properly refused to instruct the jury that:

1) The contractors could rely only on the Assistant Superintendent’s authority. This prayer was improper because the contract named Mr. Gieseking as the Assistant Superintendent’s Representative.
2) The City was not bound by Mr. Gieseking’s actions. This prayer was improper because the jury had sufficient evidence from which it could find that Mr. Gieseking had authority for his actions.
3) The default decision of the Assistant Superintendent was final and conclusive. This prayer was improper because Nelley, supra, the case relied on for such an instruction, concerned an actual arbitration — none occurred in this case.
4) The City was not estopped from enforcing its right to complete performance under the contract. This prayer was also improper. The contract gave the City a right to show incomplete performance and demand damages notwithstanding any payments or representations made to the contractor. No one contested the City’s right to bring its action. The requested instruction was plainly unnecessary.

Further, the City’s exception to the instruction on oral modification of a contract is ill-founded because the trial judge correctly stated the law.

To be entitled to have its theory of the case presented to the jury, appellant must support that theory with a proper exposition of the law and sufficiently developed evidence. Levine v. Rendler, 272 Md. 1, 13, 320 A.2d 258 (1974). Here, we are asked to construct a special rule for interpreting municipal contracts, but there is no precedential or statutory foundation to support such a request. We are also asked to transform a letter of default into an arbitration award, but there is no evidence of notice of a hearing or of any arbitration proceeding. We therefore affirm the judgment of the court below.

Judgment affirmed; costs to be paid by appellant.

      . The Assistant Superintendent, Curtis E. Lantz, was not named in the contract, a fact noted by both the trial judge and the appellate panel. Thus, authority was placed in a position rather than a person.

      . Exodus, 5:7 "Ye shall no more give the people straw to make brick.”

      . A letter in the record questioned the advisability of awarding a pointing contract to a painting company. "[T]his is akin to giving a plumbing job to an electrician and letting him sub it out to a bricklayer.”

        The letter also mentions the problem of having to give the job to the low bidder. The difference between the $34,900 bid of G & M Painting Company and the next lowest bid was nearly $10,000. Athens, which took over the job, originally bid $46,500.

      . The "arbitration” portion of the contract reads as follows:
      "Supervision and Prerogative of the Assistant Superintendent
      (a) The work is to be carried out under the supervision of the Assistant Superintendent and to his entire satisfaction. . . .
      (b) To prevent disputes and litigations, the Assistant Superintendent shall in all cases determine the amount or quantity, quality, and acceptability of the work and materials whicn are to be paid for under the contract; shall decide all questions and disputes in relation to said work and the performance thereof, and shall, in all cases, decide every question which may arise relative to the fulfillment of the contract or to the obligations of the Contractor thereunder. His determination, decision and estimate shall be final and conclusive upon the Contractor and in case any question shall arise between the Contractor and the City touching the contract, such determination, decision and estimate shall be a condition precedent to the right of the contractor to receive any monies under the contract.” (Emphasis added.)
      The language of this clause contrasts with the wording of the American Institute for Architects’ standard clause as quoted in Frederick Contractors, Inc. v. Bel Pre Medical Center, Inc., 274 Md. 307, 334 A.2d 526 (1975), reversing Bel Pre Medical Center, Inc. v. Frederick Contractors, Inc., 21 Md. App. 307, 320 A.2d 558 (1974) on other grounds:
      "7.10.1 All claims, disputes and other matters in question arising out of, or relating to, this Contract or the breach thereof, except as set forth in Subparagraph 2.2.9 with respect to the Architect’s decisions on matters relating to artistic effect, and except for claims which have been waived by the making or acceptance of final payment as provided by Subparagraphs 9.7.5 and 9.7.6, shall be decided by arbitration in accordance with the Construction Industry Arbitration Rules of the American Arbitration Association then obtaining unless the parties mutually agree otherwise. This agreement so to arbitrate shall be specifically enforceable under the prevailing arbitration law. The award rendered by the arbitrators shall be fínal, and judgment may be entered upon it in accordance with applicable law in any court having jurisdiction thereof.” (Emphasis added.) 274 Md. at 310-11.
      While the language in the City’s contract may be interpreted as an arbitration clause, as appellant contends and appellee concedes, it would seem advisable to spell out such arbitration provisions in municipal contracts, in language similar to the A.I.A. clause above quoted.

      .' The Court was sharply critical of the contract at issue:
      “[W]e feel it is essential to make it clear that contracts of the character of the one in suit are open to very severe criticism, as are also both parties to them, because, by reason of the inexcusably obtuse manner in which such contracts have been drawn and adopted, they at once invite litigation of the most involved and protracted character, thus casting upon the courts unnecessary and very onerous work which they should not be called upon to perform. In other words, if parties to a contract see fit to adopt provisions which their own experts are unable to interpret intelligently, or to explain satisfactorily, why they were included, as is true in the present case, they can scarcely be heard to complain if a court of law finds it difficult or impossible to ascertain just what force and effect was intended to be given to such provisions, if, indeed, any intent at all lay behind their inclusion.”