Club House, LLC v. Cushman
| Decision Date | 07 June 2017 |
| Docket Number | No. 890,No. 389,890,389 |
| Parties | CLUB HOUSE, LLC v. TODD CUSHMAN, ET AL. |
| Court | Court of Special Appeals of Maryland |
UNREPORTED
Nazarian, Arthur, Zarnoch, Robert A., (Senior Judge, Specially Assigned), JJ.
Opinion by Zarnoch, J.
* This is an unreported opinion, and it may not be cited in any paper, brief, motion, or other document filed in this Court or any other Maryland Court as either precedent within the rule of stare decisis or as persuasive authority. Md. Rule 1-104.
Todd and Kristi Cushman, appellees, are residents of Wood Creek Golf Community ("Wood Creek"). Wood Creek was originally developed and operated by Club House, LLC, appellant. Pursuant to a Declaration Establishing Liens for Facilities Assessments, all residents of Wood Creek are charged yearly assessment fees in exchange for various services provided by Wood Creek. In 2015, appellant sent appellees a Notice of Intent to Record a Lien on their house under the Maryland Contract Lien Act ("MCLA"), codified at Md. Code (1974, 2015 Repl. Vol.), Real Property Article ("RP"), § 14-201 et seq. Appellant alleged that appellees failed to pay the assessment fees they owed for the years 2009 through 2012. Appellees responded by filing a Complaint in the Circuit Court for Wicomico County claiming that appellant's notice of the lien came after the statute of limitations had already expired under the MCLA. Appellant filed a four-count counterclaim. Appellees filed a motion for summary judgment on three of the four counts in appellant's counterclaim. After a hearing on appellees' motion, the court found that the statute of limitations had expired and summary judgment was granted in favor of appellees on three of the four counts in appellant's counterclaim. The court also awarded attorneys' fees to appellees. The case proceeded to trial on the remaining count. However, when the case was called for trial, appellant failed to appear and the final count of its counterclaim was dismissed with prejudice.
Appellant appealed, and now present two questions for our review:
For the following reasons, we do not address appellant's questions, because its failure to appear for trial led to a proper dismissal by the circuit court and extinguished appellant's underlying debt claim.
In 2002, appellant and Acorn Land, LLC began to develop Wood Creek in Wicomico County. On June 28, 2002, they established a Declaration Establishing Liens for Facilities Assessments, with the first phase encompassing lots for seventy-nine family homes. In October 2004, they drafted a Supplemental Declaration Establishing Liens for Facilities Operations Assessments for an additional 350 to 500 lots. The Declarations imposed annual Assessment Liens on the owners of each lot in Wood Creek. The assessments were intended to recoup the costs of building and operating sprinkler systems and swimming pool facilities. The initial assessment was $300 per year, although this amount was raised over time.
Lot 108 in Wood Creek was first conveyed to Anal Patel in 2005, subject to the annual Assessments. In July 2008, appellees took over title to Lot 108 after a foreclosure on Patel. Aside from a partial payment in 2009, appellees did not pay the assessments from 2009 through 2015.
The Declarations were assigned by appellant to Delmar Fairways, LLC ("Delmar") in 2012. On April 10, 2015, Delmar served appellees with a Notice of Intent to Lien under the MCLA, seeking repayment for the unpaid assessments from 2012 through 2015.1 On April 24, 2015, appellees filed a Complaint for a Declaratory Judgment in the Circuit Court for Wicomico County challenging the Notice of Intent to Lien.
On June 12, 2015, appellant sent appellees a Notice of Intent to Record Lien, seeking to establish a lien against appellees' house under the MCLA. According to appellant's Notice, appellees owed $3,615 for unpaid assessments from 2009 through 2012. This amount included the unpaid balance along with interest and late fees. In July 2015, appellees filed an Amended Complaint adding appellant as a defendant and challenging appellant's right to collect assessments, because the Notice of Intent was sent more than two years after the assessments being claimed, and thus, could not form a basis for a lien against their property. On August 14, 2015, appellant filed an Answer, Counterclaim, and Motion for Summary Judgment. Appellant's counterclaim alleged these four counts:
Appellant's motion for summary judgment was denied on November 12, 2015. On December 30, 2015, appellees filed a Motion for Summary Judgment, arguing that appellant's lien was barred by the two-year statute of limitations as provided in Section 14-203 of the MCLA. Appellees' motion only asked for summary judgment on counts two, three, and four of appellant's counterclaim.2 Appellees did not move for summary judgment on count one.3 On February 24, 2016, appellees filed a motion for attorneys' fees.
On March 18, 2016, the court held a hearing on appellees' motions. Appellant argued that the Declaration could be enforced as a lien without resorting to the MCLA. The court disagreed and found that appellant had proceeded against appellees pursuant to the MCLA. Under the MCLA, notice of intent to lien must be provided within two years.RP § 14-203(a)(1). As a result, the court concluded that appellant was estopped from enforcing or seeking payment due to the late notice. The court granted summary judgment in favor of appellees, ruling that appellant was barred under the MCLA from pursing payment of the assessments. Summary judgment was granted on counts two, three, and four of appellant's counterclaim.4 The court also awarded attorneys' fees to appellees.
On April 15, 2016, appellant filed its notice of appeal. On May 31, 2016, a trial was held on count one of appellant's counterclaims. Appellant did not appear at the trial. Appellees asked the court to dismiss count one of appellant's counterclaim for failure to appear. The court agreed and dismissed count one of appellant's counterclaim with prejudice. On that same day, appellees settled their case with Delmar, and it was dismissed by stipulation.
On June 17, 2016, appellant filed a renewed Notice of Appeal.
The MCLA provides a two-year statute of limitations within which a Notice of Intent to Create a Lien must be sent to property owners. RP § 14-203(a)(1). The unpaid assessment fees at issue in this case were from 2009 through 2012. Appellant sent its notice of Intent to Create a Lien to appellees in 2015, more than two years since the debt accrued. Thus, appellees argued to the circuit court that appellant's claims were barredby the statute of limitations. The court agreed, stating:
The basis for the Court's opinion is that [appellant] has proceeded against [appellees] pursuant to the Maryland Contract Lien Act found under Subtitle Two, title 14 of the Real Property Article of the Annotated Code of Maryland. 14-203(a)(1) of that legislation, RP § 14-203(a)(1) is clear with respect to the amount of notice required to be provided the property owner before any lien can be assessed or collected, or at least collected. The notice was given to [appellees] by [appellant], on June 12, 2015, therefore it's the court's opinion that any lien prior to or any assessment prior to June of 2013 is barred and that [appellant] is estopped to enforce or seek payment of any of those unpaid assessments, specifically because RP, Real Property 14-201 and what follows is the exclusive remedy. [Appellant] also made an affirmative election of remedies to pursue that particular statutory mechanism to collect it, they are barred by the language of the Statute with respect to notice on its face.
(Emphasis added).
Appellant contends that this Court's recent decision in Select Portfolio Servicing, Inc. v. Saddlebrook W. Util. Co., LLC, 229 Md. App. 241, cert. granted sub nom., 450 Md. 663 (2016), requires a reversal of the trial court's rulings. In Select Portfolio, we held that where "a Declaration recorded by the developer of a subdivision created a lien that secured payment of water and sewer charges; the lien could be enforced under the terms of the Declaration, without resort to the [MCLA]." Id. at 247. Appellant argues that under this ruling, the court in the instant case erred by finding that appellant's declaration was subject to the MCLA as an exclusive remedy, and therefore, was barred under the MCLA's statute of limitations.
Despite the holding in Select Portfolio, we decline to address the merits of appellant's argument, because its failure to appear at trial on May 31, 2016 and resultantjudgment extinguished the underlying debt at issue. Appellant contends that this appeal should still be allowed to proceed because the summary judgment granted to appellees prior to trial was the equivalent of a final judgment. Appellant argues that it was a final judgment because the ruling put appellant out of court and ended all of its claims. Appellant asserts that after summary judgment was granted, it had no further claims to pursue...
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