CourtCourt of Special Appeals of Maryland
Writing for the CourtKRAUSER.
Citation795 A.2d 754,143 Md. App. 606
PartiesRobert C. SIMPSON et al. v. CONSOLIDATED CONSTRUCTION SERVICES, INC., et al. Robert C. Simpson v. New Panorama Development Corporation, et al.
Docket Number No. 2000., No. 523 Sept. Term, No. 1960 Sept. Term, No. , No. 1999
Decision Date06 February 2002

Douglas A. Rubel, Rockville, for appellants.

Jeffrey M. Kotz (Kandel, Klitenic, Kotz, Betten & Chernow, LLP, on the brief), Towson, for appellees.

Argued before KENNEY, KRAUSER, and CHARLES E. MOYLAN, Jr., (Retired, specially assigned), JJ. KRAUSER, Judge.

A debtor must be just before he is generous. Unfortunately, that principle was not observed here. Appellee and judgment debtor, New Panorama Development Corporation ("New Panorama"), used a settlement agreement, resolving lawsuits it had filed against its contractors, to direct that settlement funds, contributed by those contractors, be used to pay its legal fees and one of its contractors, at the expense of its judgment creditors. Payment was then made by those contractors to a settlement fund, created by that agreement, even though writs of garnishment had been served on all but one of them by New Panorama's judgment creditors. While New Panorama was arguably generous—at least to its attorney and one contractor—it was hardly just. And that is the gist of this appeal.

This case began when New Panorama purchased land in Howard County from Robert F. Simpson and the estates of Julia V. Simpson and Willis E. Simpson (collectively, the "Simpsons"), for the purpose of developing a residential community to be known as "Pleasant Chase." To purchase that property, it signed a mortgage agreement with Robert F. Simpson, who was then acting individually and as the personal representative of the two estates. That agreement required New Panorama to make an initial down payment and then monthly payments to the Simpsons until the date upon which the balance of the mortgage was due. When New Panorama failed to make those payments, the trustees of the estate of the now deceased Robert F. Simpson, together with the new personal representative of the estates of Julia V. Simpson and Willis E. Simpson, filed suit in the Circuit Court for Howard County against New Panorama ("Simpson v. New Panorama") and obtained a judgment.

In the meantime, the roads at Pleasant Chase that had been paved had begun to settle and rupture. That led New Panorama to file lawsuits in that same court against the contractors that it believed were responsible for the failure of the roads ("New Panorama v. CCS"). Those contractors were also served with writs of garnishment by the Simpsons, now judgment creditors of New Panorama, in the event that New Panorama obtained a judgment against some or all of the contractors.

To avoid those garnishments and to dispose of all cross and counter-claims, New Panorama and its contractors entered into a settlement agreement whereby no money would ever touch New Panorama's hands; but one of its contractors, Consolidated Construction Services, Inc., as well as New Panorama's lawyer, Donald J. McCartney, would be paid from a settlement fund1 established by the parties, monies allegedly owed them by New Panorama. This legal legerdemain was contingent, however, upon the dismissal of all outstanding writs of garnishment by the circuit court.

Learning of that agreement, the Simpsons filed a motion to intervene in New Panorama v. CCS to protect and enforce their garnishments. That motion was denied. The circuit court then dismissed, upon motion, all of the writs of garnishment that had been served on New Panorama's contractors as well as those that were later served on McCartney and the settlement fund's escrow agent, Jeffrey M. Kotz.

At issue here are two orders: one denying the judgment creditors' motion to intervene in New Panorama v. CCS, the other granting the motions of New Panorama's contractors and others to terminate the judgment creditors' garnishments in Simpson v. New Panorama. In this consolidated appeal from those orders, the judgment creditors, appellants Robert C. Simpson and J. Kevin Doyle, trustees of Robert F. Simpson Trust and personal representatives of the estates of Julia V. Simpson and Willis E. Simpson, seek to reverse the order denying them entry into appellee New Panorama's suit against appellee contractors, Atlas Plumbing and Mechanical Inc. ("Atlas"), Consolidated Construction Services, Inc. ("CCS"), Maryland Paving and Sealant, Inc. ("MPS"), and Professional Services Industries, Inc. ("PSI"), and to reinstate the writs of garnishments served on them as well as the ones served on appellees, Donald J. McCartney ("McCartney"), and Jeffrey M. Kotz ("Kotz").

This appeal therefore presents two questions:

I. Did the circuit court err in dismissing appellants' writs of garnishment?

II. Did the circuit court err in denying appellants' motion to intervene?

For the reasons that follow, we shall reverse the order of the circuit court terminating the writs of garnishment that were served on appellees CCS, PSI, Atlas, MPS, McCartney, and Kotz, affirm the termination of the writ of garnishment served on McCartney, and remand this case to that court for further proceedings consistent with this opinion. Additionally, the denial of appellants' motion to intervene shall be affirmed.


Appellee New Panorama is a real estate development company that develops home sites for resale to residential builders. To do so, New Panorama purchases raw land, prepares a site plan, obtains necessary permits, installs sewer lines, water lines, and roads, and then sells individual lots to residential builders. In 1992, it purchased real property in Howard County from Robert F. Simpson, now deceased, which it later developed into a residential community known as "Pleasant Chase." In developing that community, New Panorama contracted with CCS to do utility work, PSI to conduct soil testing, and MPS to perform road work. Atlas was hired by Lovell Regency, a residential builder, to provide plumbing services.

Shortly after being paved, the roads began to settle, resulting in ruptures and depressions that required extensive repair. This, in turn, led to a dispute among the contractors and New Panorama as to who was responsible for this problem. When the dispute was not resolved, New Panorama, represented by appellee McCartney, filed separate suits against each of the contractors in the Circuit Court for Howard County.2 These suits were eventually consolidated.

In response to New Panorama's suit, CCS and PSI filed counter-claims against New Panorama, claiming that it had failed to pay for services rendered by them for Pleasant Chase.3 MPS also filed a counter-claim against New Panorama. In that counter-claim, it alleged that New Panorama breached its contract with MPS by failing to provide MPS with a prepared site and thereby prevented it from installing roads, gutters, and curbs at Pleasant Chase.

In addition to these counter-claims, all of the contractors, but CCS, filed crossclaims. MPS and Atlas filed cross-claims against each other and against all of the other contractors,4 and PSI filed crossclaims against MPS and Atlas.5

After this tangle of cross-claims and counter-claims was filed, appellants filed a complaint against New Panorama claiming, among other things, that New Panorama had defaulted under the terms of the mortgage agreement it had entered into to purchase the property on which it built Pleasant Chase. Appellants obtained a judgment against New Panorama for $791,857.80. To enforce that judgment, appellants served writs of garnishment on CCS, PSI, and Atlas to garnish any monies that may have been owed by those entities to New Panorama.

Thereafter, New Panorama and its contractors, including those that had already been served with appellants' writs of garnishment, agreed to resolve their differences by entering into a "Settlement Agreement, Mutual Release and Escrow Agreement." That agreement was read into the record and subsequently executed by all the parties to it, which included New Panorama, PSI, CCS, MPS, Atlas, International Fidelity Insurance Company ("IFIC") (New Panorama's bonding company), McCartney, and Kotz, who was named by the agreement as escrow agent for the settlement funds.

In the agreement, the parties stated that it was their "intention and desire" to "resolve any disputes" among them relating to the Pleasant Chase development "by paying CCS $77,500 plus interest in satisfaction of its counter-claim, third party claim, and indemnity claim," although CCS had not yet brought an indemnity claim. They further stated that "[f]or purposes of this Settlement Agreement ... PSI, MPS, and Atlas concede that CCS would have the right to institute a claim against them for indemnity, contribution, and/or negligence... with respect to damages that could conceivably be awarded in favor of New Panorama against CCS and paid by CCS as a result of the Litigation."

The agreement also provided that McCartney would be paid "$95,000 plus interest in satisfaction of his attorney's lien," stating that McCartney had served "written notice of his lien ... established pursuant to § 10-501 of the Business Occupations and Professions Article, Annotated Code of Maryland, and Rule 2-652(b) of the Maryland Rules of Civil Procedure" upon all parties to the settlement agreement for legal services he had rendered in New Panorama v. CCS. According to the settlement agreement, McCartney's lien was for "fees, expenses, costs and other compensation ... in the amount of onethird of the gross amount of any recovery or actual attorney's fees, whichever is greater."

To generate the funds to be paid to CCS and McCartney, the settlement agreement required that, upon execution, Kotz, as escrow agent of the settlement fund, be paid $75,000.00 by PSI, $47,500.00 by the insurance company for CCS, $45,000.00 by the insurance company for MPS, and $5,000.00 by the insurance company for...

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