Canterbury Riding Condominium v. Chesapeake Investors, Inc.

• Decision Date: 01 September 1985
• Docket Number: No. 568,568
• Citation: 66 Md.App. 635,505 A.2d 858
• Parties: CANTERBURY RIDING CONDOMINIUM v. CHESAPEAKE INVESTORS, INC. ,
• Court: Court of Special Appeals of Maryland

Page 635

66 Md.App. 635

505 A.2d 858

CANTERBURY RIDING CONDOMINIUM v. CHESAPEAKE INVESTORS, INC.

No. 568, Sept. Term, 1985.

Court of Special Appeals of Maryland.

March 10, 1986.

P. Michael Nagle (Laura E. Cohen, Susan L. Bayly and Hyatt & Rhoads, P.C., on brief), Washington, D.C., for appellant.

Samuel C. Steelman, Jr., Hyattsville (John D. Gilmore, Jr. and Nylen & Gilmore, on brief, Rockville), for appellee.

Argued before MOYLAN, WILNER and ROSALYN B. BELL, JJ.

MOYLAN, Judge.

The appellant, Canterbury Riding Condominium Council of Unit Owners, appeals from a judgment entered against it by the Circuit Court for Prince George's County, following the granting of a motion for summary judgment, in favor of the appellees--Chesapeake Investors, Inc.; Riley S. Merson; and Harry D. Barney--as to count two of the appellant's amended declaration, alleging a breach of fiduciary duty. The circuit court ruled that suit was not filed within the applicable three-year statute of limitations and that the appellees, therefore, were entitled to judgment as a matter of law.

Canterbury Riding Condominium is a residential condominium development in Laurel, Howard County, Maryland. The appellant, the Council of Unit Owners of Canterbury Riding Condominium, consists of the individual unit owners, each of whom also owns a percentage of the common elements of the condominium.

The appellee Chesapeake Investors, Inc. is the final successor by merger to MCD Holdings, Inc.; MCD Enterprises, Inc.; and Residential Developers, Inc. In 1975, Residential Developers and MCD Enterprises developed, designed, planned, and constructed all of the buildings and common elements appertaining to the condominium units at Canterbury Riding Condominium, including but not limited to all foundations, bearing walls, perimeter walls, main walls, footings, roofs, walls, columns, girders, beams, supports, yards, streets, recreational facilities, and gardens; central services, such as power, light, gas, sewer, hot and cold water, and central heating; and all pipes, ducts, flues, chutes, conduits, cables, wires, and other utility lines.

The developer also undertook to organize a board of directors for the condominium. The by-laws of the condominium provided that the board of directors shall be composed of five persons and that "all directors shall be Unit Owners or persons having a Unit ownership interest 'in good standing', and any person designated as a representative of any interest held by a corporation, partnership, as tenants in common, joint tenants, or tenants by the entirety, 'in good standing' shall for this purpose be deemed to have a unit ownership interest." The developer appointed Blake B. Harrison and Riley S. Merson, vice presidents of Residential Developers, and Harry D. Barney, the comptroller of MCD Enterprises, as board members. Harrison served as president of the board of directors, Merson served as vice president, and Barney served as treasurer and acting secretary.

Between August, 1975, and October, 1978, Residential Developers sold all of the condominium units and all interest in the common elements to the appellant or the class it represents. Meanwhile, the three developer-appointed directors served on the board of directors from March, 1976, to October, 1978, when the developer sold the last of its units. In 1977, the unit-owner directors began informing the developer-appointed directors of unit owners' complaints regarding construction and maintenance of the common elements. The developer-appointed directors assured them that the problems would be looked into and any defects would be remedied.

After the last of the units was sold, the developer, on October 13, 1978, relinquished the files of Canterbury Riding Condominium to the Council of Unit Owners. The developer-appointed directors resigned on October 24, 1978.

On October 13, 1981, the appellant, Council of Unit Owners of Canterbury Riding Condominium, which is responsible for the maintenance and repair of the common elements, filed suit against the appellee Chesapeake Investors, Inc., as successor by merger to the developer, and against the three developer-appointed former directors. In count one of its declaration, as amended on January 22, 1982, the Council alleged negligent construction of the condominium. In count two, the Council alleged that the three developer-appointed directors and, through them, Residential Developers and MCD Enterprises, breached their fiduciary duty to the Council of Unit Owners 1) by allowing the improper construction practices alleged in count one, 2) by reimbursing the developer for assessments, 3) by failing to take adequate steps to effect certain repairs, and 4) by concealing this conduct from August, 1975, to October, 1978.

The Council subsequently dismissed its suit against Blake Harrison. The remaining defendants--the appellees herein- --filed a motion for summary judgment as to count two, contending that the Council had knowledge of the acts constituting the alleged breach of fiduciary duty more than three years before suit was filed and that suit, therefore, is barred by the statute of limitations. Following a hearing, the circuit court agreed and granted the motion for summary judgment as to count two. An order to that effect was subsequently signed. Thereafter, in consideration of the Council's motion for entry of a final judgment, the circuit court "found no just reason for delay" and ordered "that a Final Judgment be entered as to the Defendants' Motion for Summary Judgment as granted to Count II of the Amended Complaint...." The next day, the Council filed its appeal to this Court as to count two. Count one is still pending before the circuit court.

On this appeal, the Council of Unit Onwers concedes that "the trial court was correct in finding that appellees were entitled to judgment as a matter of law on the sole issue of whether the statute of limitations had run for the assessment reimbursement claim." The Council contends, however, that the trial court erred in granting summary judgment as to count two on the issue of whether the statute of limitations barred the Council's claim that the appellees breached their fiduciary duty to the Council by allowing the condominium common elements both to be designed and to be constructed improperly and by concealing their knowledge of the construction defects.

We cannot reach the merits of the appellant's contention. Although neither side has questioned or discussed the jurisdiction of this Court to hear this appeal, we hold that this appeal is not properly before us and dismiss it.

The circuit court found that there was no just reason for the delay and directed that final judgment be entered as to count two pursuant to Md.Rule 2-602 (formerly Md.Rule 605 a). This rule was modeled after Fed.R.Civ.P. 54(b). The Maryland rule uses substantially the same language as the federal rule and the interpretations of the federal rule have been held to be especially persuasive in determining the meaning of its Maryland counterpart. Diener Enterprises v. Miller, 266 Md. 551, 295 A.2d 470 (1972); Biro v. Schombert, 285 Md. 290, 402 A.2d 71 (1979); Tidewater Ins. Assocs. v. Dryden Oil Co., 42 Md.App. 415, 401 A.2d 178 (1979).

Because of the increasingly liberal joinder of claims and joinder of parties permitted under the rules in recent years, this rule, in both its federal and state manifestations, became necessary to alleviate occasional hardship. Available to deal with the infrequent harsh case, it was intended to facilitate the entry of a judgment upon one or more claims or as to one or more parties, in a multiple-claim or multiple-party action, before the final adjudication of the entire case. It makes available, where appropriate, an immediate appeal. It seeks to avoid the possible injustice that might sometimes result from a delay in entering judgment until the final resolution of all claims. Rule 2-602 (as worded at the time of the trial court's action in this case) provided:

"When more than one claim for relief is presented in an action, including a consolidated action, whether by original claim, counterclaim, cross-claim, or third-party claim, or when multiple parties are involved, or when partial judgment is sought pursuant to Rule 2-501(e), the court may direct the entry of a final judgment as to one or more but fewer than all of the claims or parties only if the court expressly determines that there is no just reason for delay and expressly directs the entry of judgment. In the absence of such determination and direction, any order or other form of decision, however designated, that adjudicates fewer than all the claims or the rights and liabilities of fewer than all the parties shall not terminate the action as to any of the claims or parties and is subject to revision at any time before the entry of judgment that adjudicates all the claims and the rights and liabilities of all the parties." (Emphasis added). ¹

Maryland Rule 2-602 is not a grant of unlimited discretion to the trial judge. By definition, it only applies 1) "[w]hen more than one claim for relief is presented in an action" and the judgment disposes of at least one of those claims; 2) "when multiple parties are involved" ² and the judgment disposes of at least one of those parties; or 3) when a summary judgment, pursuant to Rule 2-501(e)(3), disposes of "some but less than all of the amount requested in a claim seeking money relief only." ³ Unless at least one of the claims has been totally decided or unless all the rights and liabilities of at least one of the parties have been adjudicated or unless there has been a partial summary judgment for some but less than all of the amount requested in a claim seeking money relief only, Md.Rule 2-602 is not applicable. Until one of these conditions precedent has been satisfied, the trial judge has no authority to make "an express determination that there is...