State Highway Admin. v. Kim

• Court: Maryland Supreme Court
• Writing for the Court: BELL, Chief.
• Citation: State Highway Admin. v. Kim, 353 Md. 313, 726 A.2d 238 (Md. 1999)
• Decision Date: 19 March 1999
• Docket Number: No. 15,15
• Parties: MARYLAND STATE HIGHWAY ADMINISTRATION v. Joseph KIM et. al.

726 A.2d 238

353 Md. 313

MARYLAND STATE HIGHWAY ADMINISTRATION v. Joseph KIM et. al.

No. 15, Sept. Term, 1998.

Court of Appeals of Maryland.

March 19, 1999.

Laura C. McWeeney, Asst. Atty. Gen., Annapolis (J. Joseph Curran, Jr., Atty. Gen.; Brian G. Kim, Asst. Atty. Gen., Baltimore, on brief), for Appellant.

W. Ray Ford, Bowie (Thomas F. Duley, Upper Marlboro, both on brief), for Appellees.

Argued before BELL, C.J., and ELDRIDGE, RODOWSKY, CHASANOW, RAKER, WILNER and CATHELL, JJ.

BELL, Chief Judge.

The question that we are asked to resolve in this case is whether sovereign immunity bars an award of post-judgment interest, when the money judgment entered against a State agency, in accordance with the provisions of the Maryland Tort Claims Act, Maryland Code (1984, 1989 Cum.Supp.) § 12-104¹ of the State Government Article, is for the maximum amount prescribed by the act. We hold that sovereign immunity does not preclude such an award.

I.

This case had its genesis in an automobile accident, in July 1989, in which David Kim, a 15 year old summer school student, was seriously injured. His parents, Joseph and Hoon Kim, (the "appellees"), as next friends, filed a negligence action in the Circuit Court for Prince George's County against, among others, the State Highway Administration of the Department of Transportation ("SHA"), the appellant, and the Board of Education of Prince George's County ("BOE"). The case was tried to a jury, which, at the conclusion of the trial, returned a verdict awarding the appellees $650,000 in damages. Pursuant to Maryland Code (1985, 1988 Repl.Vol., 1989 Cum.Supp.), § 9-105² of the State Finance & Proc. Article and COMAR 25.02.01.01(B)(1) (1984, Supp. 3 1989),³ with respect to the SHA, and pursuant to Maryland Code (1978, 1989 Repl.Vol.) § 4-105⁴ of the Education Article, with respect to the BOE, the trial court reduced the award to $50,000 and $100,000, respectively, and judgment was entered accordingly.

Both the SHA and the BOE noted an appeal to the Court of Special Appeals. In an unreported opinion, that court affirmed the judgments. After the intermediate appellate court issued its mandate, the SHA tendered to the appellees, in payment of the judgment, its check for $50,000. It rejected, however, the appellees' demand for post-judgment interest on that judgment, from the date of its entry. Consequently, the appellees filed, in the circuit court, a motion for appropriate relief, in which they asked the court to award post-judgment interest on the SHA judgment. The court granted the appellees' motion, prompting the SHA's appeal. This Court, on its own motion, granted certiorari, before the Court of Special Appeals considered the matter.

(a)

The appellant's argument proceeds from the premises that "[t]he sovereign immunity of the State may only be waived if the General Assembly has authorized suits for damages and has provided for the payment of the resulting judgments or settlements[,] Kee v. State Highway Administration, 313 Md. 445, 455, 545 A.2d 1312, 1317 (1988); see Katz v. Washington Suburban Sanitary Commission, 284 Md. 503, 508, 397 A.2d 1027, 1030 (1979)" and that the Maryland Tort Claims Act does not authorize payments for injury, loss, or damage, in excess of $50,000 in situations arising under the Act. From those premises, the appellant argues that, by awarding the appellees post-judgment interest on a judgment, for the maximum amount for which the State's sovereign immunity has been waived and for which provision has been made for payment, the circuit court, in effect, expanded the waiver of sovereign immunity beyond the contemplation of the General Assembly, to claims in excess of $50,000. The Legislature has neither authorized nor provided funds to pay post-judgment interest in that circumstance, it asserts.

(b)

The appellees argue, on the other hand, that the court quite properly awarded post-judgment interest on the judgment. The authority for doing so may be found, they maintain, by reading the Maryland Tort Claims Act in conjunction with Maryland Code (1974, 1989 Repl.Vol., 1989 Cum.Supp.) § 11-107(a)⁵ of the Courts & Judicial Proceedings Article and Maryland Rule 2-604(b).⁶ Because the State's sovereign immunity may be waived either directly or by implication and the right to post-judgment interest arises, not as a consequence of any damage their son suffered in the accident on July 25, 1989, but, instead, arises from the State's failure timely to pay the judgment rendered against it in February 1996, the appellees ask this Court to affirm the trial court's judgment.

II.

As indicated, the issue we are asked to resolve is whether the State's sovereign immunity applies to post-judgment interest, where the judgment is for the maximum amount of damages permitted by the Maryland Tort Claims Act. We answer that question in the negative, concluding that the statute plainly and unambiguously does not so provide. We also recognize both that sovereign immunity bars the recovery of damages and that the award of post-judgment interest is not an award of damages.

By 1981 Md. Laws, Chap. 298, effective July 1, 1982, the General Assembly enacted the Maryland Tort Claims Act. Codified at Maryland Code (1974, 1980 Repl.Vol., 1983 Cum.Supp.), §§ 5-401 through 5-408 of the Courts and Judicial Proceedings Article, this legislation waived the tort immunity of the State under specified conditions and, thus, "afforded a remedy for individuals injured by tortious conduct attributable to the State." Condon v. State, 332 Md. 481, 492, 632 A.2d 753, 758 (1993). Section 5-403(a) set forth the scope of the waiver: in six specified tort actions to recover damages,⁷ " to the extent and in the amount that the State is covered by a program of insurance."⁸

Because it was but "a cautious beginning in the effort to abolish the sovereign immunity doctrine,"⁹ there were several enumerated instances in which the State's immunity was not waived. One such instance was when pre-judgment interest was sought. § 5-403(b).¹⁰ In 1984, the Maryland Tort Claims Act was moved from Title 5, Subtitle 4, of the Courts and Judicial Proceedings Article, to its present location in the State Government Article. See 1984 Md. Laws, Chap. 284. The waiver of immunity provision, other than adding a tort action, see § 12-104(a), as well as the provision prescribing exceptions to the waiver, see § 12-104(b), remained substantially identical until they were amended in 1985. See 1985 Md. Laws, Chap. 538, § 2. Those amendments deleted the specified categories for which immunity was waived, see Clea v. Mayor and City Council of Baltimore, 312 Md. 662, 671 n. 6, 541 A.2d 1303, 1307 n. 6 (1988), and, with regard to those for which immunity was not waived, the reference to the dollar amount of the claim. Section 12-104(b) was also amended to exclude from the waiver, acts and omissions committed with malice or gross negligence, or outside the scope of the State employee's public duties.

Thus, from its inception, the Maryland Tort Claims Act has exempted pre-judgment interest from the waiver of the State's sovereign immunity. At the same time, noticeable by its absence from that legislation, and, in particular, its "Exclusions and limitations" provision, is any mention of post-judgment interest. This difference in the treatment of pre-judgment and post-judgment interest is quite significant.

a.

The allowance of interest on a judgment, at law, is of ancient lineage; the Maryland Legislature, very early in the history of the State, enacted legislation providing for the payment of interest on judgments. That legislation did not differentiate between debtors or in any way exempt the State from its reach, thereby, arguably demonstrating the legislature's desire that everyone, even the State, pay interest on judgments. As early as 1802,¹¹ among the Laws of Maryland was a statute mandating that an administrator or an executor of an estate pay not only verdicts meted out by juries, but also "interest thereon from the time of rendering the said judgment." See Ch. 101, § 1 of the Acts of 1802, I. Dorsey's Laws of Maryland (1840), at 471-472. A short time later, in Ch. 153, § 4 of the Acts of 1809, a statute of more general operation was enacted. It provided:

"And be it enacted, That in all cases where a verdict shall be given in any court of this state, the court before whom such verdict shall be given, shall and they are hereby authorized to enter such judgment upon the verdict as will carry an interest on the same until the payment of the damages assessed by the jury giving such verdict, in the same manner as is now used and practiced in the cases of a confession of judgment in said court."

I. Dorsey's Laws of Maryland (1840), at 590. Subsequently, a provision requiring the payment of post-judgment interest in respect of judgments by default was added to the laws of Maryland. See Ch. 161, § 5 of the Acts of 1811, I. Dorsey's Laws of Maryland (1840), at 605. That provision provided:

"Sec. 5. And be it enacted, That all judgments by default hereafter to be entered, shall carry interest in the same manner that judgments entered upon a finding of a jury now do; Provided always, that nothing contained in this act, except so far as the same relates to judgments by default and appeals, shall extend or be construed to extend to any case now brought or pending in any of the courts of this state."

The provision pertaining to post-judgment interest appearing in Maryland Code: Public General Laws (1888), Art. 26, § 16, addressed judgments generally.¹² It read simply: "[a]ll judgments by confession, on verdict, or by default, shall be so entered as to carry interest from the time they are rendered." Although the provision in the 1914 Code was phrased somewhat differently,¹³ the payment of post-judgment interest remained a statutory requirement until Maryland Code (1951), Art. 26, § 17,¹⁴ was repealed in 1957 Md. Laws, Chap....