Baltimore Harbor v. Ayd

• Decision Date: 27 September 2000
• Docket Number: No. 0153,0153
• Parties: BALTIMORE HARBOR CHARTERS, LTD. v. Frank AYD, III.
• Court: Court of Special Appeals of Maryland

759 A.2d 1091

134 Md. App. 188

BALTIMORE HARBOR CHARTERS, LTD. v. Frank AYD, III.

No. 0153, Sept. Term, 1999.

Court of Special Appeals of Maryland.

September 27, 2000.

C. William Michaels, Baltimore, for appellant.

Steven D. Shemenski (Turnbull, Mix & Farmer, on the brief), Townson, for appellee.

Argued before MOYLAN, EYLER and ADKINS, JJ.

ADKINS, Judge.

In this employment dispute case, Baltimore Harbor Charters, Ltd. ("BHC"), appellant, contends that the Circuit Court for Baltimore City erred in denying its motion for judgment notwithstanding the jury's verdict in favor of its former employee, Frank Joseph Ayd, III, appellee. BHC also contends that the court erred by failing to credit certain monies. Ayd cross appeals, alleging that the trial court erred in ordering a remittitur, in excluding certain evidence, and in not allowing the jury to consider whether BHC violated the Maryland Wage Payment and Collection Law.

FACTS AND LEGAL PROCEEDINGS

Ayd started a charter boat company. In 1989, when Suzanne Edwards joined the business as an officer, general manager, and sales agent, they incorporated BHC. A year later, Ayd married, and his wife became the third BHC stockholder. These three resolved to pay Ayd $200 per month to perform management and consulting services. In late 1993, Ayd and his wife began divorce proceedings. In November 1993, Edwards decided she wanted to retire. Ayd and Edwards began looking for a buyer for BHC.

In February 1994, Robert Berman bought the BHC stock and became BHC's sole shareholder. Berman became vice president of BHC, Ayd became president, and Ayd's sister, Rita O'Brennan, became the corporate secretary. Ayd continued his employment with BHC and his management of the company's day-to-day operations. In March 1994, BHC purchased a vessel named The Royal Blue. Ayd directed and managed extensive modifications to The Royal Blue over a period of five months. After the Coast Guard certified the vessel some months later, Ayd captained it.

BHC contends that from the time BHC employed Ayd until Ayd resigned on September 9, 1996, Ayd was to be paid $200 per month for administrative services and $200 to captain. Ayd, however, contends that he was to receive $30,000 annually to manage and act as a sales representative for BHC, plus a percentage of the tips for each charter he captained. He based his contention in part on a written document purporting to be an "Informal Action" of the BHC directors establishing Ayd's weekly salary as $576.92.

Ayd also testified that at the time this salary was set, the parties did not contemplate the volume of work Ayd performed on The Royal Blue, and that he had performed extensive labor on the vessel in anticipation that he would be able to re-purchase controlling interest in the company. Ayd testified that Berman promised that after he had been repaid the money he invested in the company, he would sell Ayd a controlling interest. There was also evidence that The Royal Blue increased in value as a result of the improvements that Ayd made or directed. The vessel was purchased for $365,000, and BHC invested $57,000 in repair and restoration. Anthony Fotos testified that after the vessel was restored and certified, Berman offered The Royal Blue to him for $500,000, and that he would have paid that amount for the vessel.

Berman testified that despite these improvements, the company lost money. In an effort to establish why, Berman resolved to take over responsibility for the company's finances. In the spring of 1996, Berman asked Ayd to turn over the books, but felt that Ayd "stalled" him by asserting that he was too busy to do so. In August, Berman discovered that the accounts and signature cards on the company bank accounts had never been changed to reflect his ownership. Berman closed the account and opened a new company account. When he confronted Ayd about the bank records, Berman did not believe Ayd's response that he knew nothing about the situation. Shortly thereafter, Ayd resigned, effective September 9, 1996.

On July 9, 1997, Ayd filed a complaint against BHC alleging breach of contract, quantum meruit, unjust enrichment, and a violation of Maryland's Wage Payment and Collection Law. Ayd alleged, inter alia, that he was to be paid $576.92 weekly salary plus a $40 tip for each charter trip. He had only been paid, he complained, $9,861.55 during the period of February 1994 to September 1996. The alleged unpaid compensation totaled $91,048.83. BHC counterclaimed, alleging breach of fiduciary duty, conversion, and trespass to chattel.

The case was tried before a jury. At the end of Ayd's case-in-chief, both parties made motions for judgment. Both motions were denied. After BHC presented its defense, Ayd presented rebuttal evidence. After Ayd's rebuttal case, although Ayd renewed his motion for judgment, BHC did not renew its motion. The jury awarded Ayd $76,099.33 on his breach of contract claim, and made an identical award on his unjust enrichment claim. On BHC's counterclaim for breach of Ayd's fiduciary duty, the jury awarded BHC $4,000 in compensatory damages.

BHC filed a motion for new trial, judgment notwithstanding the verdict, and remittitur. After a hearing, the court ruled that unless Ayd agreed to accept a remittitur, it would grant a new trial. When Ayd accepted the remittitur, the court reduced the jury's award by $76,099.33 (the amount of the unjust enrichment award), plus $9,861.55 for wages Ayd conceded that BHC had paid him. Thus, the judgment became $66,237.78. Both parties now appeal.

DISCUSSION

I. JNOV

BHC first contends that the trial court erroneously denied its motion for judgment notwithstanding the verdict ("JNOV"). Ayd responds that BHC lost the right to move for JNOV because it failed to make a motion for judgment at the close of all the evidence, as required by Maryland Rule 2-532. In its reply brief, BHC concedes that it failed to renew the motion at the close of all the evidence, but contends that its motion at the end of Ayd's case-in-chief was sufficient to preserve its right to make a motion for JNOV. BHC further argues that when Ayd moved for judgment, the judge denied the motion and "[t]his denial also extended to BHC's own renewed motion, as indicated by the Court." Neither the record nor the law support BHC's contentions.

Rule 2-519 governs motions for judgment, and states in pertinent part:

(a) Generally. A party may move for judgment on any or all of the issues in any action at the close of the evidence offered by an opposing party, and in a jury trial at the close of all the evidence. The moving party shall state with particularity all reasons why the motion should be granted. No objection to the motion for judgment shall be necessary. A party does not waive the right to make the motion by introducing evidence during the presentation of an opposing party's case.

* * *

(c) Effect of Denial. A party who moves for judgment at the close of the evidence offered by an opposing party may offer evidence in the event the motion is not granted, without having reserved the right to do so and to the same extent as if the motion had not been made. In so doing, the party withdraws the motion.

Rule 2-532, relating to motions for JNOV, states in pertinent part:

(a) When permitted. In a jury trial, a party may move for [JNOV] only if that party made a motion for judgment at the close of all the evidence....

(b) Time for filing.... If the court reserves ruling on a motion for judgment made at the close of all the evidence, that motion becomes a motion for [JNOV] if the verdict is against the moving party....

In interpreting the Rules of Procedure, we apply the same rules of construction that we use to interpret statutes. See Kerpelman v. Smith, Somerville & Case, L.L.C., 115 Md.App. 353, 357, 693 A.2d 357, cert. denied, 346 Md. 241, 695 A.2d 1229 (1997). The most basic rule of statutory construction is that courts should endeavor to "ascertain and effectuate legislative intent." Jones v. State, 336 Md. 255, 260, 647 A.2d 1204 (1994). Here, we are required to "ascertain and effectuate" the intent of the Court of Appeals in adopting the language in both 2-519 and 2-532 requiring that all the evidence be completed before a party may move for judgment or JNOV in a jury trial. A plain reading of both rules shows that these motions must be made at the close of all evidence. In this case, BHC made its motion for judgment at the close of Ayd's case-in-chief. That motion was denied. At the close of BHC's defense case, Ayd also moved for judgment. When Ayd's motion was denied, BHC requested that the case be reopened to introduce "some pieces of evidence," and Ayd objected. The court reopened the case, stating: "I'm going to allow you to reopen your case and the Motion for Judgment would have [to] come after." After additional documents were moved into evidence, Ayd renewed his motion for judgment on the counterclaim. Ayd then took the stand to offer rebuttal testimony. After the close of Ayd's rebuttal case, Ayd renewed his motion for judgment on the counterclaim, and again, it was denied. BHC did not renew its motion.

Under Rule 2-532(a), a motion for JNOV can be made "only if that party made a motion for judgment at the close of all of the evidence...." Here, the record is clear that BHC did not move for judgment at the close of all of the evidence. We find no merit in BHC's argument that the denial of Ayd's renewed motion for judgment should be construed also as a denial of BHC's earlier motion, which had already been denied, and which was not renewed. When BHC made its motion at the end of Ayd's case-in-chief, the court clearly denied that motion. After Ayd presented his rebuttal testimony, and closed his rebuttal case, the following dialogue occurred:

[Counsel for Ayd]: I believe I have to make a Motion again at this time to incorporate the grounds upon which I stated before for the record. Your Honor, I

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