Opinion ID: 2299034
Heading Depth: 1
Heading Rank: 4

Heading: Nature and Modifiability of 1999 Judgment

Text: Rockville's first complaint about what the Circuit Court did in 2001 is that the court had no authority to modify the 1999 judgment. That judgment, according to Rockville, was final when entered. It became enrolled thirty days later, in default of any appeal or timely motion to revise it, and, in the absence of fraud, mistake, or irregularity, which Rockville denies exists, the court had no jurisdiction thereafter to modify it. Circuit City, of course, has a different view. It claims (1) that the 1999 judgment was not final and thus never became enrolled, and (2) that, even if the judgment was final, it was procured by fraud and therefore was subject to reopening under Maryland Rule 2-535(b). In support of its first claim, Circuit City treats this case as having been bifurcated for trial, with the first phase involving the issues of (1) whether Circuit City breached the lease by vacating the premises and failing to maintain fire insurance, (2) whether Rockville breached the lease by arbitrarily and wrongfully refusing to approve the MARS sublease, and (3) if those issues were decided in Rockville's favor, what damages were due to Rockville through the date of trial. If that first phase resulted in liability on Circuit City's part under the survival clause for the continued payment of rent damages, the second phase would determine the amount of credit to be applied to that continuing obligation. The fact that the judgment order entered by the Circuit Court in 1999 expressly reserved jurisdiction to resolve any dispute over such credits establishes, in Circuit City's view, that the 1999 judgment was not final but was interlocutory in nature. The claim of fraud arises from Circuit City's assertion that Rockville wrongfully failed to disclose, in response to discovery, certain documents that, in Circuit City's view, established that Rockville's refusal to approve the MARS sublease was pretextual, which was a critical issue in the first proceeding. Circuit City charges that the deliberate non-disclosure of those documents constituted extrinsic fraud, which is a ground for reopening an enrolled judgment, that, if the non-disclosure did not constitute extrinsic fraud, it constituted intrinsic fraud, and that this Court should abandon its long-held view that intrinsic fraud is not a basis to reopen an enrolled judgment. The requisite of finality for a judgment has multiple significance. [2] If not final, either intrinsically or pursuant to a direction under Maryland Rule 2-602(b), the ruling is ordinarily not appealable, will not be indexed, does not become a lien on land, does not carry post-judgment interest, and remains subject to revision by the court until a final judgment is entered. If final, it is subject to a motion to revise and to appeal, but the time limits for those avenues of relief begin to run from the date of entry. If final, it may not be revised by the court except in accordance with Rules 2-533, 2-534, and 2-535. Neither the Code nor the Rules define when an order or ruling is sufficiently final to qualify as a judgment, perhaps wisely, as it is sometimes a very perplexing problem. The Supreme Court has observed that whether a ruling is `final' ... is frequently so close a question that decision of that issue either way can be supported with equally forceful arguments, and that it is impossible to devise a formula to resolve all marginal cases coming within what might well be called the `twilight zone' of finality, and, in light of that difficulty, that Court concluded that the requirement of finality is to be given a `practical rather than a technical construction.' Gillespie v. United States Steel Corp., 379 U.S. 148, 152, 85 S.Ct. 308, 311, 13 L.Ed.2d 199, 203 (1964) (quoting in part Cohen v. Beneficial Industrial Loan Corp., 337 U.S. 541, 546, 69 S.Ct. 1221, 1226, 93 L.Ed. 1528, 1536 (1949)). We have expressed similar comments. See Brewster v. Woodhaven Building, 360 Md. 602, 623, 759 A.2d 738, 749 (2000) (The bar has had more difficulty determining finality and appealability than with perhaps any other issue); see also Carleton M. Crick, The Final Judgment as a Basis for Appeal, 41 YALE L.J. 539, 540 (1932). We have established the general criteria for finality by case law. In Rohrbeck v. Rohrbeck, 318 Md. 28, 41, 566 A.2d 767, 773 (1989), we held: If a ruling of the court is to constitute a final judgment, it must have at least three attributes: (1) it must be intended by the court as an unqualified, final disposition of the matter in controversy, (2) unless the court properly acts pursuant to Md. Rule 2-602(b), it must adjudicate or complete the adjudication of all claims against all parties, and (3) the clerk must make a proper record of it in accordance with Md. Rule 2-601. [3] See also Board of Liquor v. Fells Point Café, 344 Md. 120, 129, 685 A.2d 772, 776 (1996); Jones v. Hubbard, 356 Md. 513, 524, 740 A.2d 1004, 1010 (1999). Whether the first two of those conditions are met usually will depend on what is before the court for adjudication. Although a number of sub-issues were presented, five basic legal or factual issues were before the court in the 1999 proceedingtwo dealing with liability and three with damages. The liability issues, submitted to and resolved by the jury, were: (1) did Circuit City breach the lease by vacating the premises or by not maintaining the fire insurance; and (2) if so, did Rockville breach the lease by wrongfully withholding consent to the MARS sublease. In light of the jury's verdicts on those issues, the court was required to determine what relief Rockville was entitled to receive. As noted, the parties had agreed that, if the first two issues were decided in favor of Rockville, Circuit City would remain liable under the lease to continue paying, as damages, the amount of rent and other costs reserved in the lease until the expiration of the lease term, subject to credit for amounts received by Rockville from any re-letting of the premises. The parties also agreed on the amount of that obligation through the date of trial. That left two further issuesthe amount of pre-judgment interest and the amount of a reasonable attorneys' fee. All five of those issues were not only resolved, but were incorporated into the court's judgment order, both in terms of the amount of money declared to be due to Rockville, which was entered, recorded, and indexed as a judgment, and in the context of the declaratory judgment entered by the court. The court's judgment order disposed of every issue then in controversyall claims against all partiesand it is clear from both the court's invocation of Maryland Rule 2-602(b) which, as we shall explain, was unnecessary, and from its express determination that the amount declared due was to carry immediate post-judgment interest, that the court intended the rulings entered on those issues to be immediately enforceable, to be immediately appealable, and thus to be final. The question of credits against Circuit City's continuing obligation, which later triggered the controversy now before us, was not then in contention and could not have been resolved by the trial court. In accordance with the dual requests for declaratory judgment and in conformance with the jury's verdict, the court declared that Circuit City remained liable for the amount of rent that it otherwise would have to pay had the lease continued. There was no qualification to that declaration, even though the parties and the court were aware that the demised premises were to be demolished by Food Lion. The effect of the Food Lion lease was relevant only with respect to the amount of credit to which Circuit City might become entitled in the future. The invocation of Maryland Rule 2-602(b) and the express reservation of jurisdiction to consider any disputes over credits against Circuit City's continuing obligation apparently proceeded from the assumption that disputes might arise with respect to those credits. The prospect of such a dispute does not affect the finality of the rulings entered, however, and did not warrant action under Rule 2-602(b). Indeed, if a controversy over credits was then properly before the court, the entry of judgment under Rule 2-602(b) would have been inappropriate, as that controversy would have been part of the continuing obligation claim made by Rockville, and we have made clear that a ruling disposing of only part of a claim may not be entered as a judgment under Rule 2-602(b). See Biro v. Schombert, 285 Md. 290, 402 A.2d 71 (1979); East v. Gilchrist, 293 Md. 453, 445 A.2d 343 (1982); Medical Mutual v. Evander, 331 Md. 301, 628 A.2d 170 (1993). The problem here lies in the trial court's having treated a dispute over post-judgment credits as denigrating the force, effect, and finality of the judgment itself. Judgments often do not end the litigation. It is not uncommon, for example, for a Circuit Court, in reviewing a decision of the District Court or of an administrative agency, to remand the matter for further proceedings. The decision resolves the issues presented to the Circuit Court and completes the disposition of all that is then before that court, but it does not determine the ultimate disposition of the matter in controversy, which may well come back before the court in a subsequent proceeding. Yet we have consistently held that such an order constitutes a final judgment. See Ferrell v. Benson, 352 Md. 2, 720 A.2d 583 (1998); Carroll v. Housing Opportunities Comm'n, 306 Md. 515, 510 A.2d 540 (1986); Montgomery County v. Revere, 341 Md. 366, 671 A.2d 1 (1996). Also in point is Jones v. Hubbard, supra, 356 Md. 513, 740 A.2d 1004. There, the court entered a consent judgment for $5,000, with a proviso that it could be settled upon payment of $2,550 within 30 days. The thirtieth day fell on a Saturday, and the $2,550 was paid the following Monday. When the plaintiff refused to mark the judgment satisfied, the defendant sought injunctive relief and also to amend or revise the judgment. We held that the judgment was final under the Rohrbeck criteria, even though it left open a future event. We concluded that, because the discount provision was part of the judgment, Maryland Rule 1-203(a), which deals with the computation of time and provides that, if the last day of a period falls on a Saturday, Sunday, or holiday, that day is not counted and that the period extends to the next day that is not a Saturday, Sunday, or holiday, was applicable, and that the payment was therefore timely under the judgment. Other courts have recognized judgments as final, notwithstanding that they not only leave open but indeed anticipate that further proceedings will be required in order to implement the judgment. In Brown Shoe Co. v. United States, 370 U.S. 294, 82 S.Ct. 1502, 8 L.Ed.2d 510 (1962), an antitrust action, the District Court found that the merger in question violated the Clayton Act and ordered divestiture. The order did not specify a particular plan for divestiture, however, but reserve[d] such a ruling pending the filing of suggested plans for implementing divestiture. Id. at 305, 82 S.Ct. at 1513, 8 L.Ed.2d at 524. Notwithstanding that loose end, the Supreme Court held that the order was sufficiently final to allow an appeal. The Court observed that the order disposed of the entire complaint filed by the Government, that [f]ull divestiture ... was expressly required, and that the defendant was permanently enjoined from having any future interest in the other company. Id. at 308, 82 S.Ct. at 1514, 8 L.Ed.2d at 525-26. See also Trujillo v. Hilton of Santa Fe, 115 N.M. 397, 851 P.2d 1064 (1993); Thompson v. Hodge, 348 S.W.2d 11 (Mo.Ct.App.1961). Both the Maryland Rules and the law generally contemplate a range of post-judgment disputes that may come before the court for resolution. Although perhaps more frequent in equity matters, where some continuing supervision by the court may be necessary and further orders are expected, disputes over the interpretation and enforcement of money judgments are not uncommon. Apart from proceedings simply to enforce the judgment (discovery in aid of enforcement, attachments and garnishments of property, sequestration of property, provided for in Maryland Rules 2-633, 2-642 through 2-644, 2-645 and 2-646, and 2-648), proceedings may arise from disputes over set-offs, agreements to settle a judgment ( see Miller v. Havre de Grace B. & T. Co., 186 Md. 678, 48 A.2d 433 (1946)), or whether a judgment has been satisfied. In those kinds of proceedings, the court may enter orders that not only alter or determine the debtor's obligation under the judgment but, in some instances, affect the judgment itself, yet the prospect of such orders, or even the contemplation of them, does not destroy the finality of the judgment upon which they are based. It is clear to us that the judgment entered in August, 1999 was final when entered, that it became enrolled 30 days later, and that it was not subject to modification thereafter except in accordance with Maryland Rule 2-535(b), for fraud, mistake, or irregularity. As an alternative argument in support of the court's modification of the judgment, Circuit City urges that there was, indeed, fraud, emanating from Rockville's refusal to disclose two letters written during its negotiations with Food Lion. Circuit City now contends that Rockville's failure to produce those relevant and discoverable documents prevented Circuit City from introducing them to support its case in the 1999 trial. The Circuit Court did not find any fraud and did not base its reopening of the judgment on fraud, and, as we have indicated, there was no fraud. The issue of whether documents pertaining to Rockville's negotiations with Food Lion were discoverable was raised in Circuit City's June, 1999 motion to reopen discovery. Circuit City sought all documents relating to the Food Lion lease, including the negotiation thereof, asserting that discovery of those documents was essential to the prosecution of Circuit City's case and to the defense of the counter-claim brought by [Rockville]. The court denied that motion, however, finding that those documents were not relevant to any issue to be resolved at the August, 1999 trial. Once judgment was entered against it, Circuit City chose not to appeal the court's ruling on its discovery motion, as it could have done. The effect of the ruling was that the documents were not discoverable and were not relevant. Withholding them could not, therefore, be regarded even as violative of discovery, much less as fraudulent. There was, accordingly, no authority for the trial court to reopen and modify the August, 1999 judgment.