Continental Casualty Company v. Kemper Insurance Company (Ct. of Special Appeals)

Filed April 2, 2007. Opinion by Judge J. Frederick Sharer.

From the official headnote:

Insurance contracts - exclusion of coverage to employee operating his own vehicle - not ambiguous - not contrary to public policy - exclusion not previously discussed by Maryland court

Policy provision in commercial automobile insurance policy that covers the auto of an employee while in the course of his employment, but excludes coverage to the employee if the auto is owned by the employee or a member of his family or household is not ambiguous.

Exclusion provision is likewise not contrary to stated public policy when minimum compulsory motor vehicle insurance law is complied with.

Judgment below that Kemper wrongly denied coverage under its policy and awarding damages and attorney fees to Continental was REVERSED on appeal.

This case arose out of an automobile accident in which the driver of one vehicle ("Green") filed suit against the other driver ("Piazza") and her (Green's) insurance company ("Kemper") for injuries received, but did not name Piazza's employer. It was uncontested that Piazza was driving his own vehicle while conducting his employer's business. A portion of the damages were paid by Piazza's personal carrier, and the remaining portion by Kemper pursuant to its underinsured motorist coverage of Green.

Kemper sought, but had not received, an agreement to defend and indemnification from Piazza's employer's insurance company ("Continental"), and subsequent to the judgment sought a declaratory judgment that Continental had been obligated to defend Piazza and must reimburse Kemper for the balance of the judgment. The trial agreed, ordering Continental to reimburse Kemper and pay its attorney fees, and Continental appealed.

At issue was an exclusion in Continental's policy, which defined an "insured" under the policy to include "[a]nyone else while using with your permission a covered “auto” you own, hire or borrow except: * * * [y]our employee if the covered “auto” is owned by that employee or a member or his or her household."

The Court found that, although Kemper argued ambiguity, it offered no alternative to the plain meaning of the provision, instead suggesting that the exclusion was inconsistent with the inclusive language requiring that "all autos" be covered, and that there should be no logical difference between driving a company car and the employee's car. While not disagreeing with the pragmatic concept, the Court noted that, absent conflict with statutory provisions or public policy, insurers are entitled to limit their liability and enforce reasonable restrictions upon the obligations they assume. While the precise language had not yet been interpreted under Maryland or Texas law (the latter being the jurisdiction whose law applied to the insurance contract), other jurisdictions had, in favor of enforcing the exception, and the Court agreed.

Kemper had also argued against enforcing the exclusion on public policy grounds. The Court rejected the challenge, since the public policy of requiring insurance coverage of motorists was met by Kemper's obligation to pay the judgment, and the issue here was only a matter of which insurer would ultimately be held liable for the judgment. The Court found that Kemper was the appropriate insurer to have to pay, and reversed the decision below.

The opinion is available in PDF format.

Jones v. State (Ct. of Special Appeals)

Filed March 29, 2007—Opinion by Judge Sharer

Tyshawn Jones was convicted by a Washington County jury of first-degree felony murder, depraved heart second-degree murder, conspiracy to commit armed robbery, armed robbery, and numerous other related and lesser included offenses. He appealed based on alleged error in allowing his statement into evidence; sufficiency of the evidence for the armed robbery, conspiracy to commit armed robbery, and first-degree felony murder convictions; and error in not polling the jury or hearkening the verdict before the jurors were discharged.

The court reversed the first-degree felony murder conviction, holding that the State did not establish a casual connection between the robbery of Victim A and the later shooting of Victim B. The Court remanded for a new trial on the other counts because the verdicts were not perfected by either a jury poll or the verdict being hearkened. The court noted that failure to poll the jury, absent a request, is not error as long as the verdict is hearkened. The Court ruled that a poll of the jury is a fully commensurable substitute for hearkening, which is of ancient origin, but in the absence of a request for a poll, hearkening is required. The Court nixed a recall and swearing of the same jurors weeks later as ineffective to cure the defect since once jurors are discharged and dispersed, they no longer constitute a jury.

The opinion is available in PDF.

Massey v. State (Ct. of Special Appeals)

Filed March 7, 2007--Opinion by Judge J. Frederick Sharer.

Appellant was convicted of possession with intent to distribute a controlled dangerous substance and possession of cocaine following a bench trial in the Circuit Court for Wicomico County. Appellant noted this appeal after his motion for a new trial and to correct an illegal sentence was denied, raising four issues:

1) Whether the suppression court erred in denying Massey's motion to suppress.

2) Whether the trial court erred by not directing the State to provide the defense with a witness's report.

3) Whether the trial court erred by considering evidence outside the record.

4) Whether the trial court erred in accepting Massey's jury trial waiver.

In limited review of the disposition of the motion to suppress, the Court considered de novo evidence and reasonable inferences drawn therefrom in the light most favorable to the prevailing party, in this instance the State.

Takoma Griffith was arrested as a result of a narcotics investigation at the Delmarva Inn. In his post-arrest interview, he telephoned and arranged for Massey to drive down from Delaware and come to the room to deliver crack cocaine. Seated next to him during the call, Griffith's arresting officer could hear partial voices on the other end of the call but admitted he could not identify the person to whom Griffith was speaking. Griffith confirmed Massey's identity from a photograph officers printed from the Delaware Criminal Justice Information System computer, and when Massey arrived at the Inn officers took him into custody and seized 3.9 grams of crack cocaine from his person and an additional 3.1 grams from his automobile. Massey now asserts that the suppression court erred in concluding that Griffith was trustworthy and takes issue with the rationale that Griffith was known to the police and was motivated to cooperate.

The Court reasoned that Griffith was neither a confidential informant, an anonymous tipster, nor an innocent civilian. Rather, he was caught red-handed, and the fact that he was interviewed "face-to-face" by police strengthens the reliability of his information. The basis of Griffith's knowledge was easily established because his information was grounded on his past conduct with Massey and by the events as they unfolded in police presence. The reliability of his information was confirmed by corroboration of details by the police, and his veracity was enhanced by the fact that he provided the information with police under circumstances that would make his information more likely to be true -- face-to-face after his arrest.

At issue in the second question was whether the officer who found the crack cocaine in Massey's automobile should have been permitted to testify even though the State failed to provide, through discovery, any report that he may prepared. During cross-examination, the officer stated that he believed he had prepared a report but had not used it to prepare his testimony and did not bring a copy to court. The Court concluded that the State had the obligation under Maryland Rule 4-263 to provide any such reports during discovery and made no effort to assuage the issue by providing relevant information. The State should have affirmatively advised the trial court that such report either did or did not exist or, if the State was likewise uncertain, ought to have sought from the court the opportunity to clarify whether such report was made. It is not for the witness to declare that the report was not used for his testimony; whether the report is useful to the defense is up to the defendant. As such, the trial court had an affirmative duty to ascertain whether the officer's report indeed existed and, if so, to ensure that it was available for review. Conviction vacated and remanded for new trial.

Third, Massey refers to the two seized baggies of cocaine. Massey's objection to the admission of the laboratory analysis of the baggie seized from his person was sustained, and admission was precluded as a discovery sanction against the State. Nonetheless, the arresting officer made reference to the baggie during his testimony, and the court engaged in a colloquy as to the significance of the difference in the weights of the two baggies (intent to distribute as opposed to personal use). Massey now argues that the trial court erred in permitting the discussion of the first baggie even though the laboratory analysis was excluded. In other words, Massey argues that the court took into account the total amount of cocaine seized from him in reaching its verdict of possession with intent to distribute, and that the possession of only 3.1 grams (the amount found in the second baggie) is insufficient to infer such an intent. While the trial judge was aware of what evidence had been admitted and what was not in the record, his decision demonstrates that the substance from the first baggie played some part in the finding that Massey had possessed cocaine in sufficient quantity to indicate the intent to distribute. Notwithtanding that there is sufficient evidence of possession with intent to distribute based solely on the possession of 3.1 grams of cocaine, the Court was unable to conclude that the trial judge ignored the persistent references to the other baggie. As such, this conviction was also vacated and remanded.

Finally, Massey asserts that the trial court made no finding that his waiver of his right to a trial by jury was intelligently and voluntarily made. This Court, however, found satisfaction that the waiver procedure was adequate and in compliance with Md. Rule 4-246.

The full opinion is available in PDF.

Harris v. State (Ct. of Special Appeals)

Filed March 7, 2007. Opinion by Judge J. Frederick Sharer.

Chester Harris was convicted by a jury in the Circuit Court for Baltimore City of automobile manslaughter and related offenses. Although he did not contest the sufficiency of the evidence, he raised three issues on appeal:

1. Whether the trial court properly accepted the jury’s verdict where the record does not show that the jury was sworn.

2. Whether the trial court abused its discretion in restricting defense counsel’s closing argument.

3. Whether the trial court abused its discretion in admitting photographic evidence.

Following jury selection, the court assigned a forelady but then, anticipating a suppression motion, excused the jury through lunch. The trial transcript shows no indication that the jury was ever sworn in upon their return. There is conflicting authority on whether the failure to administer the jury oath is a jurisdictional defect that nullifies the verdict. However, as no Maryland authority was found, the Court relied on the strong presumption that judges and court clerks . . . properly perform their duties, and such presumption also applies to the trial court’s duty to be certain that the jury was sworn. The Court held that, while the record was not sufficient to establish conclusively that the jury was sworn, they were satisfied with the court’s references to its recollection of the swearing of the jury, and Harris’ failure to offer evidence to the contrary result in Harris having failed to carry his burden of persuasion.

Harris next complains that the trial court erred in restricting his summation relating to the reliability of eyewitness testimony. In summation, defense counsel undertook an attack on the reliability of eyewitness testimony. The trial court sustained the prosecutor’s objections to the attack, warning defense counsel that he could not refer to other cases. Although defense counsel protested that he was not referring to another specific case, the trial court found that his closing argument referred to other cases "indirectly" and ordered counsel to avoid such references. This Court found that the trial court acted within its broad discretion in limiting even inferential references to unrelated cases and circumstances.

Finally, Harris challenged three photographs of the victim at the scene which were admitted into evidence, arguing that the photographs were unduly prejudicial because they provoked an emotional response. The Court reasoned that photographs may be relevant and possess probative value even though they often illustrate something that has already been presented in testimony. Further, the Court held the trial judge engaged in the appropriate balancing in admitting the photos, as the photos were illustrative of the graphic testimony presented by the responding firefighter/paramedic.

The full opinion is available in PDF.

LaSalle Bank, N.A. v. Reeves (Ct. of Special Appeals)

Filed Marc 2, 2007. Opinion by Judge J. Frederick Sharer.

From the opinion's headnote:

HEADNOTE: LaSalle Bank, N.A. v. Reeves
No. 0268, September Term, 2005
Civil Procedure - Jurisdiction - Indian Tribes.
Civil Procedure - Statute of Limitations.
Civil Procedure - Equity- Laches.

After appellant, LaSalle Bank, N.A., sought reformation of a deed of trust which inaccurately described the property that secured said deed, circuit court granted appellee, Elizabeth A. Reeves’, motion for summary judgment on the grounds that the claim was barred by the three-year statute of limitations. On appeal, appellant sought a determination of whether the court erred in applying the statute of limitations for civil actions rather than the equitable doctrine of laches.

Appellee raised the issue of jurisdiction and immunity because, prior to her default, she executed and recorded a quitclaim deed conveying any interest she held in the subject property to the Delaware Tribe. Although certain Indian tribes are immune from state court jurisdiction, at the time of the circuit court’s grant of summary judgment, the Delaware Tribe was not a federally recognized tribe and had been subsumed into the Cherokee Nation. Thus, the Cherokee Nation was a necessary party to the instant declaratory judgment action and remand was required.

For the guidance of the circuit court on remand, we noted that because appellant’s amended complaint contained allegations sufficient to sustain an action for reformation, their prayer for relief could properly be construed as a request for equitable relief. Since appellee was sufficiently on notice of the cause of action, appellant’s complaint for declaratory relief did not limit the circuit court to the application of statutory limitations, to the exclusion of laches.

The opinion is available in PDF format.

Hill v. Cross Country Settlements (Ct. of Special Appeals)

Decided January 5, 2007 – Opinion by Judge J. Frederick Sharer.

Reaffirming the maxim that "money paid under mistake may be recovered when it is against good conscience for the recipient to retain the money," the Court of Special Appeals affirmed the grant of summary judgment to Cross Country Settlements in this case involving monies mistakenly paid to Appellant Hill following the sale of a house.

Hill's mother had conveyed the property to her in 1991, reserving a life estate. The life estate reservation required Hill to apply the proceeds from a future sale of the property to any mortgage indebtedness existing at the time of such sale. In 1999 and again in 2002, Hill's mother obtained a home equity loan from Provident Bank. The mother died in May 2003, thereby extinguishing the life estate and vesting entire fee simple ownership in Hill, who continued making payments on the 2002 mortgage (the only one remaining), until she agreed to sell the property in 2004.

At that time Provident mistakenly assured Cross Country several times - once in writing - that there was no outstanding lien on the property and that a certificate of satisfaction had been forwarded to the appellant. While the Court recognized that full responsibility for the error rested with Provident, it reasoned that, "To suggest that the substantial overpayment to [Hill] was not a windfall strains credulity and brings to mind the fictions of the tooth fairy and Easter bunny." Thus the Court concluded that Hill was favored with receipt of funds that, in equity and good conscience, she ought not retain.

Hill also challenged the standing of Cross Country to sue, arguing that it had no obligation to pay off the unpaid mortgage debt. The Court rejected this argument, noting that the evidence below showed that Cross Country did have an obligation to pay pursuant to its underwriting agreement.

Observing that the lack of an express contract or privity between Hill and Cross Country would not preclude application of the principles of unjust enrichment, the Court ruled that it would be unconscionable and contrary to equity to permit Hill to retain the wrongly paid funds, and so it affirmed.

The full opinion is available in WordPerfect and PDF.