Blessing v. Sandy Spring Bank
| Decision Date | 23 June 2022 |
| Docket Number | 1223-2021 |
| Parties | CHARLES BLESSING, JR. v. SANDY SPRING BANK, ET AL. |
| Court | Court of Special Appeals of Maryland |
Circuit Court for Montgomery County Case No. 453759V
Wells C. J., Reed, Salmon, James P. (Senior Judge, Specially Assigned), JJ.
The parties to this appeal are appellant, Charles Blessing, Jr. ("Blessing") and appellees, Sandy Spring Bank ("the Bank") and 227 East Diamond, LLC ("227").
On August 29, 2018, Blessing filed a complaint in the Circuit Court for Montgomery County against appellees. In Count I of that complaint, he asked the court to declare, among other things, that in 2014 the Bank, without a legal right to do so, transferred certain personal and other property to 227. The property that was alleged to have been improperly transferred was formerly owned by Growlers of Gaithersburg LLC ("Growlers").[1]According to the complaint, the property at issue was, at the time of transfer, owned by one Jonathan Silverman ("Silverman"), but Silverman, in 2018, transferred his interest in the property to Blessing.
The Bank and 227 filed a motion for summary judgment as to Count I. In its motion, 227 contended that it purchased the property at issue along with Growlers' lease and underlying real estate from a receiver pursuant to a receivership proceeding filed by the Bank. Blessing countered that he owned the property at issue because: 1) the property had been previously owned by Growlers, subject to a security interest from Growlers in favor of Silverman; Silverman's security interest was transferred by Silverman to Blessing by virtue of an assignment days prior to the filing of the subject law suit; and/or 2) that as a part of an alleged forbearance agreement, Growlers, in 2014, surrendered its ownership of the property to Silverman; that ownership interest in the property in question was subsequently transferred by Silverman to him.
A hearing on the motion for summary judgment was held in the circuit court on July 11, 2019. At the end of the hearing, the motions judge said that he was going to grant defendants' motion. On September 3, 2019, the circuit court signed an order that read, in material part, as follows: "ORDERED, that the Defendant's [sic] motion is GRANTED; and it is further, ORDERED, that the entirety of Count I is dismissed as to Defendants[,] Sandy Spring Bank and 227 East Diamond LLC." The circuit court, however, did not declare the rights of the parties.
In Count II of the complaint, Blessing had attempted to allege a cause of action against the Bank and 227 for fraudulent conveyance but Count II had earlier been dismissed by the circuit court. Therefore, the September 3, 2019 order was a final judgment and appellant filed a timely appeal from that judgment.
On February 19, 2021, a panel of this Court issued an unreported opinion that was authored by Chief Judge Matthew Fader. Judges Douglas Nazarian and Sally D. Adkins, Senior Judge, Specially Assigned, joined in that opinion. We shall hereafter refer to that opinion as "Judge Fader's opinion."
The panel affirmed the circuit court's dismissal of Count II on the grounds that the count did not set forth a cause of action upon which relief could be granted. In the present appeal, Blessing does not take issue with the dismissal of Count II.
In regard to Count I, Judge Fader opined that the circuit court erred in granting summary judgment because the court did not set forth, in writing, the rights of the parties.
Judge Fader quoted Bowen v. City of Annapolis, 402 Md. 587, 608-09 (2007) (quoting Allstate Ins. v. State Farm Mut. Auto. Ins., 363 Md. 106, 117 n.1 (2001)) as follows:
[W]hen a declaratory judgment action is brought and the controversy is appropriate for resolution by declaratory judgment, the court must enter a declaratory judgment and that judgment, defining the rights and obligations of the parties or the status of the thing in controversy, must be in writing. It is not permissible for the court to issue an oral declaration. . . . When entering a declaratory judgment, the court must, in a separate document, state in writing its declaration of the rights of the parties, along with any other order that is intended to be part of the judgment. Although the judgment may recite that it is based on the reasons set forth in an accompanying memorandum, the terms of the declaratory judgment itself must be set forth separately. Incorporating by reference an earlier oral ruling is not sufficient, as no one would be able to discern the actual declaration of rights from the document posing as the judgment. This is not just a matter of complying with a hyper-technical rule. The requirement that the court enter its declaration in writing is for the purpose of giving the parties and the public fair notice of what the court has determined.[2]
(Emphasis in original.)
In his unreported opinion, Judge Fader, after setting forth in detail the undisputed facts, said:
For guidance on remand, we will make some additional observations regarding the bases cited by the circuit court in entering summary judgment. See Rupli [v. S. Mountain Heritage Soc'y, Inc.], 202 Md.App. [673,] 680 n.7 [(2011)] (). To do so, we must first explore the basis for Mr. Blessing's claimed interest in the assets at issue and his contention that genuine disputes of material fact should have precluded the circuit court from entering summary judgment.
Judge Fader then proceeded to examine, in detail, Blessing's contention as to why he currently owned the property at issue. Judge Fader opined that none of Blessing's contentions, based on the current state of the summary judgment record, had merit. The order read:
JUDGMENT OF THE CIRCUIT COURT FOR MONTGOMERY COUNTY AFFIRMED IN PART AND VACATED IN PART. CASE REMANDED TO THE CIRCUIT COURT FOR FURTHER PROCEEDINGS CONSISTENT WITH THIS OPINION. COSTS TO BE PAID 2/3 BY APPELLANT AND 1/3 BY APPELLEES.
Upon remand, a hearing on the motion for summary judgment as to Count I was held on July 2, 2021. No new evidence was proffered by either side. The motions judge then took the matter under advisement.
Blessing, on August 13, 2021, filed a "Request for a Trial," which the Bank and 227 opposed on the grounds that Judge Fader's opinion only remanded the case to the circuit court for entry of declaratory judgment consistent with the panel's opinion. The circuit court, on September 9, 2021, denied Blessing's request for a trial. On that same date, the court issued an order granting the defendants' motion for summary judgment as to Count I; the circuit court then proceeded to declare the rights of the parties. In declaring the rights of the parties, the circuit court denied all six declarations that Blessing had requested in his complaint.
Blessing, acting as his own counsel, then filed this timely appeal. He phrases the questions presented as follows:
BACKGROUND FACTS[3]
Growlers is the former operator of a bar and restaurant located at 227 East Diamond Avenue in Gaithersburg, Maryland ("the Premises"). In May 2006, Growlers purchased the business from Gaithersburg Brewing Company. In connection with the transaction, Gaithersburg Brewing Company conveyed to Growlers:
All of the tangible assets owned by or used in the operation of the Business, including furniture, fixtures and equipment, goodwill and trade name, inventory, supplies, books and records, customer and vendor lists, and all other property, tangible or intangible, used in the Business known as "Summit Station Restaurant and Brewery[.]"
Growlers did not receive any "interest in land or any interest in real property[.]" At the time, the Premises were owned by KB Summit Land, LLC ("KB Summit Land").
Between May 2006 and June 2009, the Bank made a series of loans to KB Restaurants, LLC ("KB Restaurants"), the then-majority member of Growlers. Those loans were secured by agreements executed by KB Restaurants and Growlers, as well as an "Indemnity Deed of Trust and Security Agreement" executed by KB Summit Land, which gave the Bank a security interest in the Premises. The aggregate sum of the loans ultimately amounted to nearly $2.4 million.
On January 13, 2011, the owners of 100% of the membership interests in Growlers assigned those interests to Jr. Rams, LLC ("Jr. Rams"). As part of the transaction, title to certain "personal property and fixtures" was transferred to Jr. Rams "free and clear of any liens[.]" The property subject to the transfer was listed on a Bill of Sale attached to the Assignment Agreement. The list included a variety of furniture, dishes, glassware, utensils, office equipment, clothing, tools, cleaning supplies, and the business's "complete inventory of food and alcohol[.]" We will refer to this property, which did not include any brewing equipment, cooking equipment, or other appliances, as the "Jr. Rams Personal Property."
Also on January 13, 2011, KB Summit Land, the owner of the premises and Growlers, executed a new lease of the Premises. The agreement was signed by, among others, the Bank, Jr. Rams (as the contract purchaser of the Growlers membership interests), and Blessing, as Jr. Rams' managing director. Among its terms, the lease provided: "[Growlers] expressly acknowledges they are using...
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