Colonial Carpets, Inc. v. Carpet Fair, Inc.

• Decision Date: 15 June 1977
• Docket Number: No. 1196,1196
• Citation: 36 Md.App. 583,374 A.2d 419
• Parties: COLONIAL CARPETS, INC. t/a The Carpet Barn v. CARPET FAIR, INC. t/a Bills Discount Carpet Barn.
• Court: Court of Special Appeals of Maryland

Page 583

36 Md.App. 583

374 A.2d 419

COLONIAL CARPETS, INC. t/a The Carpet Barn v. CARPET FAIR, INC. t/a Bills Discount Carpet Barn.

No. 1196.

Court of Special Appeals of Maryland.

June 15, 1977.

Bernard L. Sweeney, Washington, D. C., with whom were Walter D. Ames and Watson, Cole, Grindle & Watson, Washington, D. C., on the brief, for appellant/cross-appellee.

Shale D. Stiller, Baltimore, with whom were Peter F. Axelrad, Jonathan Eisenberg and Frank, Bernstein, Conaway & Goldman, Baltimore, on the brief, for appellee/cross-appellant.

Argued before GILBERT, C. J., and MOYLAN and MELVIN, JJ.

GILBERT, Chief Judge.

The practice of law may be poetically likened to sailing a ship. Constitutions, case law, and legislative enactments are to the lawyer what charts, buoys, and beacons are to the sailor. The compass, however, is generally agreed to be the most important navigational aid on ship. The Maryland Rules of Procedure are the lawyer's compass and serve to help him steer through the narrows of pleading, pass the rocks of default, around the shoals of limitation, and safely into the harbor of judgment. It is a reckless sailor, indeed, who puts to sea without a compass, and it is a reckless lawyer who fails to familiarize himself with the Rules of Procedure before he files and tries a case.

Notwithstanding the importuning of the Court of Appeals and this Court that the rules of procedure are not to be considered as mere guides or Heloise's helpful hints to the practice of law but rather precise rubrics that are to be read and followed, ¹ admonitions go unheeded by some practitioners. When that occurs, we are left to wonder whether we are engaged in an endless struggle, just as waves beat upon the shore, fall back and then repeat over and over ad infinitum. ²

This appeal arises because trial counsel for the appellant, demonstrating a paucity of knowledge of Maryland procedure, frustrated the appellee, and so jumbled the orderly process that even the trial judge's compass went awry.

The basis of the appeal is an order of the Circuit Court for Prince George's County awarding appellee's counsel a fee of $4500 for services rendered subsequent to the voluntary dismissal of appellant's suit against the appellee for an injunction. Appellee has cross-appealed on the ground that the amount of the fee awarded its counsel is parsimonious. Additionally, the appellee has moved to dismiss the appellant's appeal on the ground that there was no compliance with Md. Rule 1028. For reasons that we shall hereafter discuss, we reverse the order of the circuit court and remand for further proceedings in accordance with this opinion. It follows that we deny the motion to dismiss.

The record discloses that this litigation, permeated with the ostensible acrimony of opposing counsel, commenced on December 4, 1974, with the filing of a Petition for Injunction by Colonial Carpets, Inc., t/a The Carpet Barn (Colonial) against Carpet Fair, Inc., t/a Bill's Discount Carpet Barn (Fair). The petition alleged that Fair had infringed upon Colonial's Maryland registered trade mark and name. ³ It prayed that Fair be enjoined from so doing and that Colonial be "assessed" money damage for the "loss of profits" it had sustained.

The petition was promptly met with a demurrer which, reduced to its common denominator, averred that the petition failed to state a cause of action. The circuit court agreed with Fair's position and sustained the demurrer with leave to amend.

On March 7, 1975, the amended petition was filed. It took form in two counts. One reasserted the infringement by Fair upon Colonial's registered trade mark ⁴ and name. The second charged Fair with "deceptive and misleading" advertising through the use of the name "Carpet Barn" and unfair competition. Colonial requested that an injunction issue against the use of the trade name "Carpet Barn" by Fair and that there be an accounting by Fair of its "profits realized while operating under the name 'Bill's Discount Carpet Barn.' " Fair answered within the prescribed time and denied any infringement upon Colonial's trade name or mark.

For the ensuing time, March 26, 1975 to February 2, 1976, the parties engaged in legalistic sparring relative to discovery. During the discovery period, Colonial's counsel died and new counsel was substituted. The unmistakable bitterness of counsel toward each other, rather than diminishing, seemingly intensified.

Colonial sought a pretrial conference, Fair amended its answer to the petition by substantially embellishing it, and the case was set for trial on February 2, 1976.

At the outset of the trial, Colonial's counsel informed the judge that Colonial desired Fair to produce voluntarily alleged managers of three of Fair's stores, and a fourth person who was the president of the agency that handled Fair's advertising. Fair refused to comply with the request. Colonial then requested permission to put into evidence the depositions of the witnesses that were not present. Fair objected to that procedure because the witnesses were not parties to the suit, and no summons had been issued for their attendance. Md. Rule 413 a 3.

The trial judge suggested that Colonial's lawyer issue an order to the clerk for the summoning of three of the witnesses with the idea that the sheriff could telephone the persons to be subpoenaed and so inform them, requesting their appearance.

The trial of the case started with the calling by Colonial of its president as the first witness. The witness was still undergoing direct examination when the court recessed for lunch. After the luncheon recess, Colonial's lawyer advised the court that he had been told by the sheriff's office that all the requested witnesses ⁵ were located outside of Prince George's County and that the sheriff was without jurisdiction to serve summons on them. Colonial, through its counsel, told the judge that, "it now appears highly unlikely that any of these four witnesses ⁶ will be subject to the service and will appear as witnesses today. I feel, therefore, that . . . (Colonial's) case will be seriously jeopardized, and that is a prime basis for our motion for a non-suit without prejudice."

Over the strenuous objection of the attorney for Fair, the judge granted the motion. In so doing, however, he read from Md. Rule 541 pertaining to voluntary dismissals of an action at law and Md. Rule 582 which is concerned with similar dismissal in equity proceedings. The judge then said:

"So, I'm going to grant your motion without prejudice. However, I'm going and it can't be determined until the matter is finally resolved in your next jurisdiction where you file it, but I'm going to leave open the question of attorney's fees to the defendant in this case which may be allowed to be recoverable because we don't know how much of this that has transpired to date can be used in a new proceeding. If it is used in a new proceeding, well and good. If not, then I think the plaintiff should be held accountable therefor."

A written order followed twenty-three days later. It provided in pertinent part:

"ORDERED, that this Court is reserving the possibility of the award of attorney's fees to counsel for the defendant (Fair) until such time as the subject matter of the litigation is finally determined."

By so ordering, the trial judge cleared the ring for the main event which followed on April 7, 1976, when Fair's attorney filed in the circuit court a "Petition for Award of Counsel Fees" in the amount of sixteen thousand dollars ($16,000). The petition, bottomed on Md. Rule 604, recited the happenings up to and including the date of the aborted trial, February 2, 1976. Additionally, the petition contained the number of hours that Fair's counsel had devoted to the matter through February 2, 1976 and thereafter in the subsequent federal claim brought by Colonial against Fair.

The record shows that four (4) days after the voluntary dismissal in the Circuit Court for Prince George's County, Colonial instituted in the United States District Court for the Eastern Virginia District, Alexandria Division, a "Complaint for False Designation of Origin, Trademark Infringement and Unfair Competition." The suit embraced, in part, the infringement of Colonial's trademark which had been the subject of the Prince George's County litigation.

Two months later, April 6, 1976, a settlement was reached in the federal suit. By the terms thereof, Fair agreed to cease the use of the offending terms, "Bill's Carpet Barn" and "Bill's Discount Carpet Barn." A notice of dismissal "without prejudice" was subsequently filed in federal court by Colonial on April 12, 1976.

A hearing on the petition for counsel fees was held on August 10, 1976, before the original trial judge. The judge took the matter under advisement and rendered his "Opinion and Order of Court" on October 15, 1976. Both sides appealed. Colonial asserts that the trial court was wrong to award any fee to Fair's lawyers; Fair asserts the trial judge erred in not awarding fees to cover the labors of counsel from the conception, by way of suit on December 4, 1974, to the abortion, by voluntary dismissal on February 2, 1976.

Although, as we have previously pointed out, Md. Rule 541 b, permits voluntary dismissal, ⁷ "upon such terms and conditions as the court deems proper," that authority has not been held to embrace the award of counsel fees. ⁸ Moreover, Rule 541 is limited in its scope to actions at law, Md. Rule 1 a, and as such would in any event have no application to the case sub judice which is an equity proceeding brought for the purpose of obtaining an injunction and accounting.

A semblance of Md. Rule 541 may be found in Md. Rule 582, which is applicable only to equity proceedings. Md. Rule 1 a. Md. Rule 582 authorizes a voluntary dismissal of an "action, claim, counterclaim, cross-claim, or third party claim only with leave of court." ⁹ The court shall specify in its...