Case Title: Credible Behavioral Health v. Johnson

Citation: 

Docket Number: 19/19

State: maryland

Court: Maryland Supreme Court

Date: 2019-11-20T00:00:00Z

Document:
Credible Behavioral Health, Inc. v. Emmanuel Johnson, No. 19, September Term 2019.  
Opinion by Greene, J.  
 
APPEAL AND ERROR—JUDGE AS FACTFINDER BELOW 
Under Maryland Rule 7–131(f), the circuit court, when hearing an appeal on the record from 
the district court, reviews the district court’s factual determinations for clear error and its legal 
conclusions de novo.   
 
CONTRACTS—CONSTRUCTION AND OPERATION—GENERAL RULES OF 
CONSTRUCTION 
Under the promissory note at issue, employees are required to repay the loan in accordance 
with the repayment schedule in Paragraph 1(a) in both situations where an employee is fired or 
quits.   
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
IN THE COURT OF APPEALS 
 
OF MARYLAND 
 
No.  19 
 
September Term, 2019 
 
______________________________________ 
  
CREDIBLE BEHAVIORAL HEALTH, INC. 
 
 
 
v. 
EMMANUEL JOHNSON 
 
 
Barbera, C.J. 
McDonald 
Watts 
Hotten 
Getty 
Booth 
Greene, Clayton, Jr. (Senior Judge, 
Specially Assigned) 
 
JJ. 
______________________________________ 
 
Opinion by Greene, J. 
______________________________________ 
 
Filed: November 20, 2019 
 
Circuit Court for Montgomery County 
Case No. 9858D 
Argued: October 8, 2019 
 
Pursuant to Maryland Uniform Electronic Legal 
Materials Act 
(§§ 10-1601 et seq. of the State Government Article) this document is authentic. 
 
 
 
 
 
Suzanne C. Johnson, Clerk 
2019-11-20 
15:09-05:00
 
Petitioner, Credible Behavioral Health, Inc. (“Credible”) offers a tuition loan 
program to its employees aimed at incubating and furthering their professional 
development.  Respondent, Emmanuel Johnson, a former employee of Credible, 
participated in this program from August 10, 2016 until he was fired several months later.  
Under a promissory note outlining the agreement, the amount of the loan that must be 
repaid is dependent upon the length of time an employee works for Credible after 
completing his or her education.   
  This case presents two issues for our consideration: (i) the appropriate standard of 
review in an appeal on the record from the district court to the circuit court; and (ii) the 
interpretation of a promissory note.  As to the second issue, Mr. Johnson contends that the 
agreement contemplates repayment only if an employee quits within a relevant time period; 
whereas, Credible argues that repayment is required upon the conclusion of employment 
within that time period, regardless of whether an employee is fired or quits.  We shall hold 
that: (i) a circuit court, in hearing an appeal on the record from the district court, reviews 
the district court’s factual determinations for clear error and its legal conclusions de novo; 
and (ii) the promissory note, when read as a whole and viewed in the appropriate context, 
requires repayment of the principal balance in both situations where an employee quits and 
where Credible fires an employee.1   
 
                                                          
 
1 We note that the requirement to repay the principal balance is conditioned upon the 
occurrence and non-occurrence of several events.  This will be explained in greater detail 
in the following section.   
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FACTUAL AND PROCEDURAL BACKGROUND 
Credible is a Delaware corporation that provides software solutions to behavioral 
health and human service providers.  To cultivate its employees’ professional development, 
Credible offers a tuition loan program to them.  Under the program, Credible agrees to loan 
funds to employees who wish to obtain additional education—be it undergraduate, 
graduate, or post-graduate certificate programs.  The percentage of the loan that an 
employee must repay is dependent upon the length of time he or she works for Credible 
subsequent to completing his or her studies.   
Mr. Johnson was an employee of Credible in 2016.  On August 10, 2016, Mr. 
Johnson entered into Credible’s tuition loan program, and the parties memorialized their 
agreement under the terms of an unsecured promissory note.  Paragraph 1(a) of the 
promissory note contains a schedule which sets forth the conditions of tuition repayment 
under the program: 
FOR VALUE RECEIVED, Emmanuel Johnson (“Borrower”), an 
individual and an employee of CREDIBLE BEHAVIORAL HEALTH, 
INC., a Delaware corporation (“Company”), hereby unconditionally 
promises to pay to the order of Company in lawful money of the United 
States of America and in immediately available funds the aggregate principal 
amount set forth on Schedule A together with all accrued and unpaid interest 
thereon, if any (the “Loan”).  It is the intent of Borrower and Company that 
the purpose of this Promissory Note (the “Note”) is to pay tuition expenses 
for undergraduate, graduate or post-graduate certificate programs in 
connection with the Company’s Tuition Loan program.  
 
1. Principal Repayment 
 
(a)   The principal balance of the Loan plus all accrued interest thereon shall 
be due and payable in accordance with the following schedule: 
 
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(i) 
If you terminate employment with the Company within 12 
months following achievement of the degree, 100% of the Loan; 
 
(ii) 
If you terminate employment with the Company after the 12 
month anniversary but on or before the 24 month anniversary 
following achievement of the degree, 75% of the Loan; 
 
(iii) 
If you terminate employment with the Company after the 24 
month anniversary but on or before the 36 month anniversary 
following achievement of the degree, 50% of the Loan; or 
 
(iv) 
If you terminate employment with the Company after the 36 
month anniversary following achievement of the degree, 0% of the 
Loan.   
 
(Emphasis in original).  The final part of Paragraph 1(a) sets forth the relevant scope 
of the agreement:  
The appropriate percentage of the Loan set forth above, plus all accrued 
interest thereon shall be due and payable (i) ninety (90) calendar days after 
the termination of your employment, whether by you or the Company, for 
any or for no reason whatsoever, or (ii) immediately or at the option of 
Company, as set forth in Section 4(b) below, upon the occurrence of any 
Event of Default (as defined by in Section 4 below).  Borrower understands 
that taxes will be deducted from these paychecks based upon the amount that 
would have been paid Borrower had payments for principal and/or interest 
not been deducted.   
 
Pursuant to the agreement, Credible loaned Mr. Johnson $12,529 to assist him in paying 
his tuition.  In December of 2017, Credible fired Mr. Johnson.  At the time of his 
termination, Mr. Johnson had not yet obtained a degree.  Subsequently, Credible and 
Johnson entered into a payment plan under which Mr. Johnson made one payment in the 
amount of $325 on February 28, 2018 and made no further payments.  As a result, the 
balance due on the promissory note was reduced to $12,204.   
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On April 25, 2018, attorneys for Credible sent a demand letter to Mr. Johnson, which 
indicated that the principal balance of the loan was due on March 13, 2018 and requested 
Mr. Johnson make payment by May 25, 2018.  As a result of Mr. Johnson’s failure to make 
any additional payments due under the promissory note, on June 8, 2018, Credible brought 
an action against Mr. Johnson in the District Court of Maryland sitting in Montgomery 
County seeking repayment of the debt.  
The district court held a trial in the matter on September 12, 2018.  That same day, 
the district court entered a judgment in Mr. Johnson’s favor.  The district court judge 
reasoned that, under the language of Paragraph 1(a), the amounts set forth only became 
due if Mr. Johnson quit from his employment with Credible.  In its analysis, the district 
court concluded that Paragraph 1(a) and the provision that follows it were inconsistent.  
Particularly, the court determined that the provision following Paragraph 1(a) referenced 
back to Paragraph 1(a) for the amount that would be due if an employee was terminated.  
In its view, however, the schedule set forth in Paragraph 1(a) only applied in situations 
where employees quit and therefore there was no basis to determine the amount Mr. 
Johnson owed by reference to Paragraph 1(a), because he was fired.  The trial judge 
ultimately determined that “[a]t best I’m interpreting it as it exactly is written.  At worse 
it’s an inconsistency which goes against the person who drafted the contract.” 
The following day, September 13, 2018, Credible appealed the judgment of the 
district court to the Circuit Court for Montgomery County pursuant to Courts and Judicial 
Proceedings Article § 12–401(a).   The circuit court heard the appeal on the record under 
Maryland Rule 7–102(b) and held a hearing on February 15, 2019.  Before that court, 
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Credible argued that Mr. Johnson was required to repay the loan regardless of whether he 
was fired or quit.  In contrast, Mr. Johnson contended that the district court correctly 
interpreted the note, and he was only required to repay the loan if he quit.  Ultimately, in a 
written opinion and order dated March 7, 2019, the circuit court found that the district court 
“was [not] clearly erroneous in its interpretation of the promissory note at issue in this 
case” and therefore affirmed its judgment. 
Thereafter, Credible petitioned this Court for a writ of certiorari, which we granted 
on June 7, 2019.  Credible Behavioral Health, Inc. v. Johnson, 464 Md. 7, 210 A.3d 182 
(2019).  In its petition for a writ of certiorari, Credible presented three questions for this 
Court’s review: 
1. Did the [c]ircuit [c]ourt erroneously apply Md. Rule 7–133(f) when it 
reviewed the [d]istrict [c]ourt’s construction of a contract’s terms for 
clear error rather than de novo? 
2. Did the plain terms of the parties’ promissory note (“Note”) entitle 
Credible to a judgment against the defendant below, respondent 
Emmanuel Johnson?  
3. In interpreting the Note, did Maryland law require the [c]ircuit [c]ourt to 
choose [ ] one among two possible readings of the Note that was 
consistent with the parties’ intent?  
 
STANDARD OF REVIEW 
Under Maryland Rule 8–131(c), an appellate court reviews cases tried without a 
jury “on both the law and the evidence.  It will not set aside the judgment of the trial court 
on the evidence unless clearly erroneous, and will give due regard to the opportunity of the 
trial court to judge the credibility of the witnesses.”  Md. Rule 8–131(c); Nesbit v. Gov’t 
Emps. Ins. Co., 382 Md. 65, 72, 854 A.2d 879, 883 (2004).  Although the Rule does not 
explicitly state the standard of review applicable to a trial court’s determinations of legal 
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questions, this Court has indicated that the clear error standard does not apply to 
“determinations of legal questions or conclusions of law.”  Tribbitt v. State, 403 Md. 638, 
644, 943 A.2d 1260, 1263 (2008).  Instead, “[w]hen the trial court’s order ‘involves an 
interpretation and application of Maryland statutory [or] case law, [the appellate] [c]ourt 
must determine whether the lower court’s conclusions are legally correct under a de novo 
standard of review.’”  Nesbit, 382 Md. at 72, 854 A.2d at 883 (quoting Walter v. Gunter, 
367 Md. 386, 392, 788 A.2d 609, 612 (2002)).   
DISCUSSION 
The Standard of Review under Maryland Rule 7–113(f) 
 
First, we must determine the applicable standard of review when a circuit court 
reviews a judgment of the district court under Maryland Rule 7–113(f).  Ultimately, we 
reaffirm this Court’s earlier position that the circuit court reviews the district court’s factual 
determinations for clear error and its legal conclusions de novo.  The dispute in this case 
arises from language utilized in the circuit court’s order and opinion concerning the 
relevant standard of review.  Therein, the circuit court concluded, “[t]he standard of review 
in an Appeal heard on the Record is a clearly erroneous standard.  This [c]ourt does not 
find that the [d]istrict [c]ourt was clearly erroneous in its interpretation of the promissory 
note at issue in this case.”  
Credible argues that the circuit court erred by applying the clearly erroneous 
standard to the district court’s interpretation of the underlying promissory note.  Credible 
contends that the district court’s interpretation or construction of a contract is a legal 
determination that ought to be reviewed by the circuit court de novo.  Whereas, Mr. Johnson 
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argues that the district court’s ultimate conclusions stemmed from an application of its 
factual findings to the contractual language.  Moreover, Mr. Johnson contends that, 
regardless of the applicable standard of review, he should prevail.   
On its face, Rule 7–113(f) expressly contemplates only a clearly erroneous 
standard: 
(f) Scope of Review. The circuit court will review the case on both the law 
and the evidence. It will not set aside the judgment of the [d]istrict [c]ourt on 
the evidence unless clearly erroneous, and will give due regard to the 
opportunity of the [d]istrict [c]ourt to judge the credibility of the witnesses. 
 
Md. Rule 7–113(f).  Maryland Rule 1386 is the predecessor to Rule 7–113(f).  Friendly 
Fin. Corp. v. Orbit Plymouth Chrysler Dodge Truck, 378 Md. 337, 343 n.5, 835 A.2d 1197, 
1200 n.5 (2003).  It contained the same relevant provisions as Rule 7–113(f) concerning 
the scope of review when a circuit court reviews decisions of the district court.2  Prior to 
the enactment of Rule 8–131(c), Rule 886 governed this Court’s review of actions tried 
without a jury and contained language nearly identical to that of Rule 1386.3  In Ryan v. 
Thurston, Chief Judge Murphy, writing for the Court of Appeals, analogized Rules 1386 
and 886 to determine the appropriate standard of review when a circuit court hears an 
                                                          
 
2 Maryland Rule 1386 provided that the circuit court “will review the case upon both the 
law and the evidence, but the judgment of the lower court will not be set aside on the 
evidence unless clearly erroneous and due regard will be given to the opportunity of the 
lower court to judge the credibility of the witnesses.”  Hous. Opportunities Comm’n of 
Montgomery Cty. v. Lacey, 322 Md. 56, 59, 585 A.2d 219, 221 (1991).   
 
3 Maryland Rule 886 indicated that “[t]he Court of Appeals will not set aside the judgment 
of the lower court on the evidence unless clearly erroneous and due regard will be given to 
the opportunity of the lower court to judge the credibility of the witnesses.”   
 
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appeal from the district court.  276 Md. 390, 391–92, 347 A.2d 834, 835–36 (1975).  He 
explained that, under the scheme set forth by Rule 1386, the clearly erroneous standard 
applies only to the district court’s factual determinations.  Id. at 392, 347 A.2d at 836.   
Although the Ryan Court did not explicitly state that the circuit court reviews the 
district court’s legal conclusions de novo, this Court held that the applicable standard of 
review under Rule 1386 is the same as that governing the Court of Appeals’ review of 
actions tried without a jury under Rule 886 and “that the cases applying these rules are 
controlling authority governing the interpretation of the scope of appellate review[.]”4  Id.  
Within the context of Rule 886, this Court has held that “it is equally obvious that the 
‘clearly erroneous’ portion of Rule 886 does not apply to a trial court’s determinations of 
legal questions or conclusions of law based upon findings of fact.”  Davis v. Davis, 280 
Md. 119, 124, 372 A.2d 231, 233 (1977) (quoting Clemson v. Butler Aviation, 266 Md. 
666, 671, 296 A.2d 419, 422 (1972)).  Accordingly, under Rules 886 and 1386 a lower 
court’s legal conclusions have historically been reviewed for legal correctness.  See Davis, 
280 Md. at 124–26, 372 A.2d at 233–34.   
Subsequent to reorganization of the Maryland Rules, this Court affirmed the 
analogical approach advanced earlier in Ryan, by indicating that the clearly erroneous 
                                                          
 
4 The Court also drew a comparison between Rule 1386 and Rule 1086 which, at the time, 
governed the scope of appellate review in cases before the Court of Special Appeals.  Ryan, 
276 Md. at 391, 347 A.2d at 835.  Subsequently, the language of Rules 886 and 1086 was 
incorporated into that of Rule 8–131(c).  See Md. Rule 8–131; State Sec. Check Cashing, 
Inc. v. Am. Gen. Fin. Servs. (DE), 409 Md. 81, 109–10, 972 A.2d 882, 899 (2009).   
 
- 9 - 
 
standard applies to the district court’s factual determinations and its legal conclusions are 
reviewed de novo: 
These are the same standards of review that [c]ircuit [c]ourts, following 
Maryland Rule 7–113(f) in cases such as the present one, should apply when 
they review [d]istrict [c]ourt judgments . . . . Maryland Rule 8–131(c) has 
nearly identical language to Rule 7–113(f) regarding the scope of appellate 
review, and cases interpreting Rule 8–131(c) are persuasive regarding Rule 
7–113(f).  Under Rule 8–131(c), clear error is the proper standard for review 
of the evidence, but it is not the proper standard for questions of law, 
which are reviewed de novo. 
 
Friendly Fin. Corp., 378 Md. at 343 n.5, 835 A.2d at 1200 n.5 (emphasis added) (citations 
omitted).5  Further, this Court has consistently interpreted Rule 8–131(c) to require de novo 
review of a circuit court’s legal conclusions.  Tribbit, 403 Md. at 644, 943 A.2d at 1263 
(2008); Goff v. State, 387 Md. 327, 337–38, 875 A.2d 132, 138 (2005); Friendly Fin. Corp., 
378 Md. at 342–43, 835 A.2d at 1200.   
Ultimately, our precedent on this issue and a comparison between Rule 7–113(f) 
with its appellate analog Rule 8–131(c) and their predecessors, make clear that the circuit 
                                                          
 
5 The facts of Friendly Fin. Corp., concerning the circuit court’s application of the clearly 
erroneous standard, are strikingly similar to those of the instant appeal.  The Court 
commented, “[t]he [c]ircuit [c]ourt in this case, however, may have applied a ‘clearly 
erroneous’ standard to its review of the [d]istrict [c]ourt’s legal analysis. We glean this 
from the fact that, in its written opinion, the [c]ircuit [c]ourt made reference only to the 
deferential clearly erroneous standard.”  378 Md. at 343 n.5, 835 A.2d at 1200 n.5.   
 
Similarly, the express language of the circuit court’s order in the instant appeal 
evinces a blanket application of the clearly erroneous standard to both the district court’s 
factual and legal conclusions.  In Friendly Fin. Corp., however, the Court held that the 
circuit court’s erroneous application of Rule 7–113(f) was ultimately harmless.  Id. 
(“Because we agree that the [d]istrict [c]ourt’s legal analysis was correct, the [c]ircuit 
[c]ourt’s possible applications of the incorrect standard of review was harmless error if it 
was error at all.”)   
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court reviews the district court’s legal conclusions de novo.  Our interpretation of Rule 7–
113(f) is entirely consistent with the uncontroverted proposition that, under Rule 8–131(c), 
this Court reviews a lower court’s factual determinations for clear error and its legal 
conclusions de novo.  Accordingly, we hold that, in an appeal on the record under Rule 7–
113(f), the circuit court reviews the district court’s factual determinations for clear error 
and its legal conclusions de novo.   
Next, we must determine whether the district court’s interpretation of the 
promissory note is a legal conclusion.  Regarding this issue, we have consistently held that 
“the interpretation of a contract, including the question of whether the language of a 
contract is ambiguous, is a question of law subject to de novo review.”  Myers v. Kayhoe, 
391 Md. 188, 198, 892 A.2d 520, 526 (2006) (citing Towson v. Conte, 384 Md. 68, 78, 862 
A.2d 941, 946 (2004)); Ocean Petroleum, Co. v. Yanek, 416 Md. 74, 86, 5 A.3d 683, 690 
(2010) (citing Clancy v. King, 405 Md. 541, 556–57, 954 A.2d 1092, 1101 (2008)); Dennis 
v. Fire & Police Emp.’s’ Ret. Sys., 390 Md. 639, 656, 890 A.2d 737, 747 (2006); Walton 
v. Mariner Health of Md., Inc., 391 Md. 643, 660, 894 A.2d 584, 660 (2006) (quoting 
Myers, 391 Md. at 197–99, 892 A.2d at 526–27); Sy-Lene of Washington, Inc. v. Starwood 
Urban Retail II, LLC, 376 Md. 157, 163, 829 A.2d 540, 544 (2003); Lema v. Bank of Am., 
N.A., 375 Md. 625, 641, 826 A.2d 504, 513 (2003).   
Clearly, the interpretation or construction of a contract is a legal determination 
subject to de novo review.  As evident from the language utilized in the circuit court’s order 
and opinion, the district court engaged in contract interpretation—a legal determination.  
Therefore, the circuit court’s broad application of the clearly erroneous standard and its 
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conclusion “that the [d]istrict [c]ourt was [not] clearly erroneous in its interpretation of the 
promissory note” were made in error.   
Interpretation of the Promissory Note 
Having clarified the appropriate standard of review under Rule 7–113(f), regarding 
a circuit court’s review of the district court’s legal determinations and demonstrated that a 
court’s engagement in contract interpretation is a legal determination, we must now 
interpret the promissory note at issue in the appeal sub judice.   
The dispute over the promissory note in the instant appeal concerns the requirement 
to repay the loan and the classes of employees to which the repayment obligation applies.  
Mr. Johnson contends that, based on the promissory note’s plain language, the circuit court 
correctly interpreted the note to require repayment of the underlying loan only in situations 
where an employee quits his or her job with Credible.  In contrast, Credible argues that the 
terms of the promissory note, taken as a whole, reveal that the parties intended the loan to 
be repaid upon termination of employment within the relevant time period—regardless of 
whether an employee is fired or quits.  Moreover, neither party contends that the provisions 
of the promissory note are ambiguous.   
Generally, Maryland courts subscribe to the objective theory of contract 
interpretation.  Myers, 391 Md. at 198, 892 A.2d at 526.  Under this approach, the primary 
goal of contract interpretation is to ascertain the intent of the parties in entering the 
agreement and to interpret “the contract in a manner consistent with [that] intent.”  Ocean 
Petroleum, Co., 416 Md. at 88, 5 A.3d at 691 (citing Pac. Indem. Co. v. Interstate Fire & 
Cas. Co., 302 Md. 383, 388, 488 A.2d 486, 488 (1985)).  An inquiry into the intent of the 
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parties, where contractual language is unambiguous, is based on what a reasonable person 
in the position of the parties would have understood the language to mean and not “the 
subjective intent of the parties at the time of formation.”  Ocean Petroleum, Co., 416 Md. 
at 86, 5 A.3d at 690 (citing Cochran v. Norkunas, 398 Md. 1, 17, 919 A.2d. 700, 709 
(2007)); Auction & Estate Representatives, Inc. v. Ashton, 354 Md. 333, 340, 731 A.2d 
441, 444 (1999) (“the clear and unambiguous language of an agreement will not give away 
to what the parties thought that the agreement meant or intended it to mean.” (quoting 
Calomiris v. Woods, 353 Md. 425, 436, 727 A.2d 358, 363 (1999)).  
Ascertaining the parties’ intentions requires us to consider the plain language of the 
disputed contractual provisions “in context, which includes not only the text of the entire 
contract but also the contract’s character, purpose, and ‘the facts and circumstances of the 
parties at the time of execution.’”  Ocean Petroleum, Co., 416 Md. at 88, 5 A.3d at 691 
(quoting Pac. Indem. Co., 302 Md. at 388, 488 A.2d at 488).  Throughout this review, we 
interpret a contract’s plain language in accord with its “ordinary and accepted meaning[.]”  
Ocean Petroleum, Co., 416 Md. at 88, 5 A.3d at 691 (quoting Fister v. Allstate Life Ins. 
Co., 366 Md. 201, 210, 783 A.2d 194, 199 (2001)).   
Contractual language is ambiguous where a reasonably prudent person could ascribe 
more than one reasonable meaning to it.  Calomiris, 353 Md. at 436, 727 A.2d at 363.  
Where a court determines contractual language to be ambiguous, the narrow bounds of the 
objective approach give way, and the court is entitled to consider extrinsic or parol 
evidence to ascertain the parties’ intentions.  Sullins v. Allstate Ins. Co., 340 Md. 503, 508, 
667 A.2d 617, 619 (1995).  Additionally, we have previously noted that “a term which is 
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clear in one context may be ambiguous in another.”  Id. (citing Tucker v. Fireman’s Fund 
Ins. Co., 308 Md. 69, 74, 517 A.2d 730, 732 (1986)).   
The disputed term in this appeal is the word “terminate” as utilized in Paragraph 
1(a) of the promissory note.6  Traditionally, to supply contractual language with its 
“ordinary and accepted meanings[,]” this Court consults the dictionary definition of such 
terms.  Pac. Indem. Co., 302 Md. at 388, 488 A.2d at 489 (commenting that we have 
“consulted Webster’s Dictionary, Random House Dictionary, or, less often, Black’s Law 
Dictionary” for this purpose).  Webster’s Dictionary defines the word “terminate” as “1.  
[t]o bring to an end or a halt.  2.  To occur at or form the end of : conclude.”  Webster’s II 
New College Dictionary 1166 (3rd ed. 2005).   
At its most basic, viewed relative to this definition, the repayment obligation is 
conditioned upon an employee concluding his or her employment with Credible.  As 
evident from the parties’ arguments, this language could be interpreted in two different 
ways.  Further, we are faced with two contrary interpretations of the promissory note: (i) 
employees are obligated to repay the loan in both situations where the employee is fired or 
quits; and (ii) an employee is obligated to repay the loan only in situations where he or she 
quits.  As we will demonstrate, the former interpretation, advanced by Credible, is 
reasonable.  Whereas, the latter, advanced by Mr. Johnson, is not.  On this basis, the 
promissory note is not ambiguous.   
                                                          
 
6 The primary thrust of Mr. Johnson’s argument on this point focuses on the subject of the 
sentence—“you”—rather than the term “terminate.”   
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We have previously explained that our journey into the interpretation of a contract 
commences with “[d]etermin[ing] from the language of the agreement itself what a 
reasonable person in the position of the parties would have meant at the time it was 
effectuated[.]”  Dumbarton Improvement Ass’n v. Druid Ridge Cemetery Co., 434 Md. 37, 
53–54, 73 A.3d 224, 233 (2013) (quoting Calomiris, 353 Md. at 436, 727 A.2d at 363) 
(internal quotation marks omitted).  We begin our inquiry into the intent of the parties by 
examining the preamble of the promissory note.   
The preamble indicates that Mr. Johnson “unconditionally promises to pay to the 
order of [Credible] . . . the aggregate principal amount set forth on Schedule A together 
with all accrued and unpaid interest thereon.” (emphasis in original).  Additionally, the 
preamble notes that “the intent of [Mr. Johnson] and [Credible] that the purpose of this 
Promissory Note . . . is to pay tuition expenses for undergraduate, graduate or post-graduate 
certificate programs in connection with [Credible’s] Tuition Loan program.”  The intent of 
the parties becomes increasingly clear in the context of the paragraph that follows 
Paragraph 1(a). 
The final part of Paragraph 1(a) provides context to the application of Paragraph 
1(a) and clearly constitutes an obligation to repay the loan.  It reads, 
[t]he appropriate percentage of the Loan set forth above, plus all accrued 
interest thereon shall be due and payable (i) ninety (90) calendar days 
after the termination of your employment, whether by you or the 
Company, for any or for no reason whatsoever, or (ii) immediately or at 
the option of Company, as set forth in Section 4(b) below, upon the 
occurrence of any Event of Default (as defined by in Section 4 below).  
Borrower understands that taxes will be deducted from these paychecks 
based upon the amount that would have been paid [by] Borrower had 
payments for principal and/or interest not been deducted.   
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(Emphasis added).  In other words, regardless of the specific language used in Paragraph 
1(a), the provision that follows it requires employees to repay the loan in situations where 
he or she is fired.  This independent obligation merely references the previous four 
subparagraphs to determine the amount due on the loan based upon how long an employee 
maintains employment with Credible after attaining a degree or certificate. Furthermore, 
the provision substantially uncloaks the intent underlying the promissory note.  It makes 
clear that the parties intended the loan to be repaid in accordance with the framework 
established in Paragraph 1(a) in situations where Credible fires an employee.   
We have previously indicated that, when interpreting contracts, “[w]e also attempt 
to construe contracts as a whole, to interpret their separate provisions harmoniously, so 
that, if possible, all of them may be given effect.”  Walker v. Dep’t of Human Res., 379 
Md. 407, 421, 842 A.2d 53, 61 (2004) (citing Jones v. Hubbard, 356 Md. 513, 534–35, 740 
A.2d 1004, 1016 (1999)).  More specifically, contract interpretation requires that “[e]ffect 
. . . be given to each clause” to avoid “an interpretation which casts out or disregards a 
meaningful part of the language of the writing unless no other course can be sensibly and 
reasonably followed.”  Clancy, 405 Md. at 557, 954 A.2d at 1101 (quoting Sagner v. 
Glenangus Farms, Inc., 234 Md. 156, 167, 198 A.2d 277, 283 (1964)) (internal quotation 
marks omitted).  Under the interpretation of the promissory note adopted by the district 
court and affirmed by the circuit court, the substance of this provision is jettisoned absent 
any reasonable justification.   
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As evident, the conditions of this provision are indeed meaningful, and we can “find 
no sound reason to read the [provision] out of the contract.”  Sanger, 234 Md. at 167, 198 
A.2d at 283.  This is especially true where the intent of the parties is readily ascertainable, 
and the substance of Paragraph 1(a) can be reconciled with the remaining provisions in the 
promissory note.  Based on the ordinary and accepted meaning of the term “terminate,” 
Paragraph 1(a) employs somewhat awkward language that indicates the amount due on the 
loan if the employee concludes his or her employment.  The paragraph contains no 
substantive indication that the amount becomes due only if an employee unilaterally 
concludes his or her employment.  The final part of Paragraph 1(a) reveals that the 
repayment schedule applies both in situations where an employee is fired or quits.  Our 
conclusion is further buttressed by several other aspects of the promissory note. 
 
As a bedrock principle of contract interpretation, Maryland courts consistently 
“strive to interpret contracts in accordance with common sense.”  Brethren Mut. Ins. Co. 
v. Buckley, 437 Md. 332, 348, 86 A.3d 665, 674 (2014) (citing Fister, 366 Md. at 219, 783 
A.2d at 205).  For two reasons, interpreting the promissory note to require repayment only 
when an employee of Credible quits defies such a common sense approach.   
 
First, the circuit court’s and district court’s interpretation of the promissory note 
runs contrary to common sense and strains credulity, because it results in the disparate 
treatment of employees based upon whether they are fired or quit.  Particularly, under the 
lower courts’ interpretation of the language in Paragraph 1(a), employees fired by Credible 
would not be required to repay any amount of the loan, whereas, an employee who quits 
his or her job at Credible would be required to repay the loan in accordance with the 
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percentages listed in Paragraph 1(a).  We see no reason why, under the promissory note, 
an employee who is fired should be treated more favorably than one who quits.  
Accordingly, the lower courts’ interpretation of the promissory note engenders disparate 
treatment of Credible’s employees by treating employees who are fired more favorably.  
As demonstrated, the resulting distinction is untenable and runs contrary to common sense.   
 
Second, Paragraph 4(c) of the promissory note contains a “Drop/Fail Repayment” 
clause.  Pursuant to this provision, if a borrower drops or fails a class, it is construed as an 
event of default under the promissory note, and the borrower is required to pay the portion 
of the loan attributable to that class within thirty days.  It is contrary to our common sense 
approach that, under the promissory note, an employee would be required to pay back funds 
for a class he or she dropped or failed but would not be required to repay any portion of 
the loan if he or she was fired.  Essentially, if Mr. Johnson’s interpretation of Paragraph 
1(a) controlled, then any employee who expected he or she may fail his or her classes could 
simply act in a manner that would compel Credible to fire the employee.  Accordingly, 
under this interpretation, an employee could act unilaterally to circumvent the “Drop/Fail 
Repayment” provision of the promissory note.  In summation, given the context of the 
promissory note and the overarching intent of the parties in entering into the agreement, it 
is clear that the lower courts’ and Mr. Johnson’s interpretation of the promissory note runs 
contrary to common sense.  Although two interpretations can be given to the language of 
Paragraph 1(a), only one of those—that advanced by Credible—is reasonable in our view.   
Moreover, even if we were to adhere to Mr. Johnson’s interpretation, i.e., that 
Paragraph 1(a) only applies in situations where an employee quits, we would construe 
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conflicting contractual provisions “to effectuate the intention of the parties as collected 
from the whole instrument, the subject matter of the agreement, the circumstances 
surrounding its execution, and its purpose and design.”  Canaras v. Lift Truck Servs., Inc., 
272 Md. 337, 351–52, 332 A.2d 866, 874 (1974) (citing Lumber Co. v. Bldg. & Sav. Ass’n, 
176 Md. 403, 407, 5 A.2d 458, 460 (1939)).  Further, “if reconciliation can be effected by 
a reasonable interpretation, such interpretation should be given to the apparently repugnant 
provisions, rather than nullify any.”  Id. at 352, 332 A.2d at 874.  Mr. Johnson urges this 
Court to nullify the substance of the final part of Paragraph 1(a) rather than effectuate a 
reasonable interpretation that harmonizes the two provisions—a result that runs contrary 
to our tenets of contract interpretation. 
In sum, Credible’s interpretation of the promissory note is the only reasonable 
interpretation of the two competing interpretations advanced.  Indeed, Credible’s 
interpretation of the note is in accord with our common sense approach to contract 
interpretation.  Further, out of the two interpretations, Credible’s is the only interpretation 
of the promissory note that harmonizes the substance of Paragraph 1(a) with the remaining 
provisions of the note.  Moreover, our review of the promissory note, as a whole, including 
its context and the underlying intent of the parties, evinces that the parties intended the loan 
to be repaid regardless of whether the employee quits or is fired by Credible.  Any contrary 
construction is ill-founded based on the promissory note’s context and the practical 
consequences of such a construction.   
 
Additionally, Mr. Johnson contends that this Court must construe any inconsistency 
in the promissory note against Credible, its drafter.  This argument is misapplied in two 
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respects.  First, a contract will be “most strongly construed against” its drafter when a court 
finds the contractual terms at issue to be ambiguous.  Prima Paint Corp. v. Ammerman, 
264 Md. 392, 395, 287 A.2d 27, 28 (1972) (citing Kelley Const. Co. v. Washington 
Suburban Sanitary Comm’n, 247 Md. 241, 250, 230 A.2d 672, 678 (1967)).    
Here, neither party contends that the language of Paragraph 1(a) or the promissory 
note in general is ambiguous.  We were able to ascertain the parties’ intentions by 
reviewing the promissory note as a whole in its appropriate context.  As demonstrated 
supra, out of the two interpretations advanced, Credible’s interpretation is reasonable and 
Mr. Johnson’s is not.  Therefore, the promissory note is not ambiguous.  As evident, the 
prerequisite for the application of this tenet—ambiguity—is absent in the instant appeal.  
Therefore, we need not construe the promissory note against Credible.   
 
Lastly, Credible argues that Mr. Johnson waived any right to challenge the 
promissory note by entering into a payment plan under which he would repay the principal 
balance of the loan and by making only one payment under the plan.7  In response, Mr. 
Johnson argues that Credible should be precluded from raising this argument by virtue of 
Md. Rule 8–131(a), because Credible did not present this argument before the courts 
below.  Although this Court has the discretion to entertain issues for the first time on appeal 
in certain instances, we need not consider this dispute because we hold that, under the terms 
of the promissory note, Mr. Johnson was required to repay the principal balance.   
                                                          
 
7 In its opening brief, Credible provides the Court with a fourth question presented, “[d]id 
[Mr.] Johnson waive his right to contest the Note’s enforceability by paying the first 
installment in the parties’ agreed payment plan?”  This question, however, was absent from 
Credible’s petition for writ of certiorari.  We do not reach it. 
- 20 - 
 
CONCLUSION 
 
In summation, pursuant to Rule 7–113(f), on appeal from the district court, a circuit 
court reviews the district court’s legal conclusions de novo.  The interpretation of a contract 
is a legal conclusion, and the circuit court erred by applying the clearly erroneous standard 
to the district court’s interpretation of the promissory note.   Based on the plain language 
of the promissory note, supplemented by contextual indicators and common sense, the 
circuit court also erred in construing the promissory note to require repayment only in 
situations where an employee quits.  Therefore, we reverse the judgment of the Circuit 
Court for Montgomery County.   
JUDGMENT OF THE CIRCUIT COURT 
FOR 
MONTGOMERY 
COUNTY 
IS 
REVERSED. COSTS TO BE PAID BY 
RESPONDENT.