Justia Maryland Supreme Court Opinion Summaries

A hospital and a physician entered into a settlement agreement to resolve a dispute over the suspension of the physician's clinical privileges. The agreement required the hospital to submit a report to a regulatory authority using specific language agreed upon by both parties. The hospital, however, selected codes for the report that generated additional text, which the physician claimed contradicted and was inconsistent with the agreed language. The physician sued for breach of the settlement agreement.The Circuit Court for Montgomery County granted summary judgment in favor of the hospital, ruling that the settlement agreement did not restrict the hospital's selection of codes for the report. The Appellate Court of Maryland disagreed, holding that a reasonable person would understand the hospital's obligation to report using specific language to preclude it from including contradictory and materially inconsistent language. The Appellate Court vacated the summary judgment, finding that whether the hospital breached its obligation was a question for the jury.The Supreme Court of Maryland reviewed the case and affirmed the Appellate Court's decision. The court held that the hospital's obligation to report using specific, agreed-upon language precluded it from including additional language that contradicted and was materially inconsistent with the agreed language. The court also affirmed that the physician's claim regarding the hospital's failure to provide a timely hearing was released in the settlement agreement. The case was remanded for further proceedings to determine if the hospital's actions constituted a breach of the settlement agreement. View "Adventist Healthcare v. Behram" on Justia Law

A commercial tenant and landlord entered into a contract for the construction and lease of a warehouse, with the landlord also acting as the general contractor. The contract included a waiver of subrogation, where both parties waived subrogation against each other for certain losses, including those caused by their subcontractors. After the warehouse sustained weather damage, the tenant’s insurer sought to recoup insurance payments by suing the subcontractors.The Circuit Court for Baltimore City granted summary judgment in favor of the subcontractors, concluding that they were intended beneficiaries of the waiver of subrogation in the contract between the tenant and landlord. The court did not consider any extrinsic evidence regarding the parties' intent. The Appellate Court of Maryland reversed this decision, finding that the waiver of subrogation in the contract did not unambiguously benefit the subcontractors and that the subcontractors were not intended third-party beneficiaries.The Supreme Court of Maryland reviewed the case and held that the waiver of subrogation in the contract between the tenant and landlord did not extend to the subcontractors. The court found that the language of the waiver was unambiguous and did not show an intent to benefit the subcontractors. However, the court found that the waiver of subrogation included in the subcontracts was ambiguous regarding whether it applied to the tenant’s insurer’s claims against the subcontractors. Therefore, the court held that extrinsic evidence was needed to determine the parties' intent regarding the scope of the subrogation waiver in the subcontracts.The Supreme Court of Maryland affirmed the Appellate Court's decision, reversing the Circuit Court's summary judgment in favor of the subcontractors, and remanded the case for further proceedings to consider extrinsic evidence. View "Lithko Contracting v. XL Insurance America, Inc." on Justia Law

The Supreme Court affirmed in part and reversed in part the decision of the appellate court reversing the judgment of the circuit court granting Defendants' motion to dismiss this case for failure to state a claim upon which relief may be granted, holding that the appellate court erred in finding that Plaintiff's complaint alleged sufficient facts to state a cause of each for counts two and three.Plaintiff, a minority stockholder in a family-owned corporation, brought this action alleging one count of stockholder oppression seeking equitable relief short of dissolution (count one) and compensatory damages for claims of breach of fiduciary duty (count two) and unjust enrichment (count three). The circuit court granted Defendants' motion to dismiss, thereby denying Plaintiff's request for leave to amend the complaint. The appellate court reversed the judgment in its entirety. The Supreme Court affirmed as to count one and reversed as to the remaining counts, holding that Plaintiff's proposed amended complaint set forth sufficient facts to state a claim for stockholder oppression but did not allege sufficient facts to support Plaintiff's direct causes of action for breach of fiduciary duty and unjust enrichment. View "Eastland Food Corp. v. Mekhaya" on Justia Law

The Supreme Court held that Maryland law allows spouse to allocate martial assets in a postnuptial agreement based on whether a spouse engaged in adultery, thereby causing the breakdown of the marriage, thus affirming the judgment of the lower courts.Plaintiff filed a complaint for absolute divorce on the grounds of adultery, requesting that the circuit court incorporate the parties' postnuptial agreement into the decree. The agreement included a $7 million lump sum provision that triggered if Defendant engaged in adultery. The circuit court determined that the lump sum provision was an enforceable penalty and issued a judgment of divorce that incorporated, but did not merge, the agreement. The appellate court affirmed. The Supreme Court affirmed, holding (1) the public policy in Maryland supports intefspousal distributions of marital assets based on adultery in postnuptial agreements; and (2) Plaintiff was entitled to no more than Defendant's "50% share of the Column B Assets." View "Lloyd v. Niceta" on Justia Law

In this insurance dispute brought by Insured seeking declarations that the policies issued by Insurer covered the losses it had suffered from repairing and remediating its physical space to accommodate the health necessities brought about by the COVID-19 pandemic, holding that the allegations did not trigger the primary coverage provided by the relevant policies.Insured asserted that it suffered hundreds of millions of dollars for health and safety protocols and modifications to its stores due to the presence of COVID-19. After Insurer denied coverage Insured brought this lawsuit. Insurer moved to dismiss the complaint, after which Insured filed a motion to certify a question of law to the Court of Appeals. The Court of Appeals answered that when a first-party, all-risk property insurance policy covers "all risks of physical loss or damage" to insured property from any cause unless excluded, coverage is not triggered when a toxic, noxious, or hazardous substance such as COVID-19 is physical present in the indoor air of that property, is also present on and can later be dislodged from physical items on the property, and causes a loss of the functional use of the property. View "Tapestry, Inc. v. Factory Mutual Insurance" on Justia Law

In this appeal centering on the existence of a valid arbitration agreement the Court of Appeals affirmed the decision of the court of appeals reversing the judgment of the circuit court, holding that the circuit court erred in compelling arbitration of the question of whether the arbitration clause in the agreements at issue was valid.The arbitration clause in this case stemmed from transactions between lead paint tort plaintiffs who received structured settlements and affiliated factoring companies that specialize in purchasing structured settlement rights. Defendants filed motions to compel arbitration and stay the case, but Plaintiffs challenged the existence of a valid agreement to arbitrate. The trial court granted the motion to compel arbitration, finding that the arbitrator was to determine the issue of arbitrability. The Court of Special Appeals reversed. The Court of Appeals affirmed, holding that the circuit court erroneously compelled arbitration and that the issue of whether a valid arbitration agreement exists is an issue for the court to determine. View "Access Funding, LLC v. Linton" on Justia Law

The Court of Appeals held that an injured tort claimant's rights under a general liability insurance policy do not vest until the claimant has obtained a judgment against, or entered into a qualifying settlement with, an insured.CX Reinsurance Company issued commercial general liability policies to several Baltimore residential Landlords that included coverage for bodily injuries resulting from lead paint exposure at the Landlords' rental properties. CX field contract rescission actions against the Landlords, which the parties settled. Under the terms of the rescission settlements, the coverage for lead paint-related losses was substantially reduced. Claimants alleged they suffered bodily injuries from lead paint exposure while residing in the Landlords' rental properties, but the majority of claimants had not obtained final judgments against, or entered into settlements with, the Landlords before CX and the Landlords settled. The lower courts ruled that the Claimants were intended beneficiaries of the polices. The Court of Appeals reversed in part, holding (1) the Claimants who did not hold final judgments against or enter into approved settlement agreements with the Landlords were not the intended beneficiaries under the policies; and (2) the Claimants who obtained final judgments against their Landlords prior to the settlements of the applicable rescission cases may enforce the pre-settlement terms of the policies. View "CX Reinsurance Co. v. Johnson" on Justia Law

The Court of Appeals answered a certified question of law by holding that Md. Code Comm. Law (CL) 12-1018(b) requires a credit grantor that is found to have knowingly violated Credit Grantor Closed End Credit Provisions (CLEC), CL 12-1001 et seq., to forfeit three times the amount of interest, fees, and charged collected in violation of the subtitle.This case concerned a borrower who purchased a motor vehicle and financed it by closed end credit pursuant to an agreement governed by CLEC. The federal district court issued a certified question of law regarding the calculation of damages under CL 12-1018(b). The Court of Appeals held that, based upon prior caselaw regarding CLEC, a plain language analysis of CL 12-1018(b), and a review of the pertinent legislative history, CL 12-1018(b) requires a credit grantor who has knowingly violated the CLEC to forfeit three times the amount of interest, fees, and charges collected in violation of CL 12-1018(b). View "Lyles v. Santander Consumer USA Inc." on Justia Law

The Court of Appeals affirmed the judgment of the court of special appeals reversing the judgment of the circuit court granting summary judgment to Pabst Brewing Company (Pabst) and dismissing this breach of contract lawsuit brought by Frederick P. Winner, Ltd. (Winner), holding that the circuit court erred in its interpretation of the Successor Manufacturers Law (SML), Md. Code Ann., Alco. Bev. (AB) 5-201.Under a contract agreed upon in 1994, Winner and its predecessor entity distributed Pabst beer brands in Maryland. In 2014, Blue Ribbon, LLC purchased 100 percent of the stock of Pabst's parent entity. In 2015, Pabst terminated its contract with Winner, claiming that the termination was allowed under the SML. Winner disagreed and brought this lawsuit. The circuit court concluded that Blue Ribbon was permitted to cause Pabst to terminate its contract with Winner. The court of special appeals reversed. The Court of Appeals affirmed, holding (1) the SML applies only where the beer manufacturer that holds a Maryland license to distribute a brand of beer is replaced by another entity as the license hold with respect to that brand; and (2) Blue Ribbon did not qualify as a successor beer manufacturer, and Pabst did not have the right to terminate its contract with Winner without cause. View "Pabst Brewing Co. v. Frederick P. Winner, Ltd." on Justia Law

In this case concerning the interpretation of an ambiguous voting provision in a corporation's charter the Court of Appeals affirmed the circuit court's grant of summary judgment in favor of Respondents, shareholders of Petitioner's Series B shares, holding that the circuit court did not err.Petitioner raised issued a series of preferred stock known as Series B and a nearly identical series of preferred stock known as Series C. Petitioner later sought to buy back the shares of both series. Owners of two-thirds of the shares of both series approved the measure, but owners of less than two-thirds of Series B did so. Petitioner argued that the approval of two-thirds of shares of both series, counted together, provided the necessary approval required by the charter provision relating to Series B shares. Respondents filed this action seeking to restore and rights and preferences of Series B shares. The circuit court found that the charter language was ambiguous and that the failure to obtain the approval of owners of two-thirds of the Series B shares doomed Petitioner's proposal to buy back those shares. The Court of Appeals affirmed, holding (1) the voting provision was ambiguous; and (2) the extrinsic evidence relating to the voting provision resolved the ambiguity in favor of separate voting by Series B shareholders. View "Impac Mortgage Holdings, Inc. v. Timm" on Justia Law