Vir v. Julian

Decision Date26 October 2011
Docket NumberNos. 2764,2010.,1511,Sept. Term,2009,s. 2764
PartiesWycinna L. SPENCE et vir.v.Emerson R. JULIAN, Jr. et al.Emerson R. Julian, Jr. et al.v.Mercy Medical Center, Inc. et al.
CourtCourt of Special Appeals of Maryland

201 Md.App. 562
30 A.3d 220

Wycinna L. SPENCE et vir.
v.
Emerson R. JULIAN, Jr. et al.Emerson R. Julian, Jr. et al.
v.
Mercy Medical Center, Inc. et al.

Nos. 2764

Sept. Term

2009

1511

Sept. Term

2010.

Court of Special Appeals of Maryland.

Oct. 26, 2011.


[30 A.3d 222]

Rignal W. Baldwin (Jeffrey P. Bowman, Baldwin, Kagan & Gormley LLC, on the brief), Annapolis, MD, for Appellant.Michelle R. Mitchell (David A. Levin, Michael K. Wiggins, Wharton, Levin, Ehrmantraut & Klein, on the brief), Annapolis, MD, for Appellee.Panel: JAMES R. EYLER, GRAEFF and CHARLES E. MOYLAN, JR. (Retired, Specially Assigned), JJ.GRAEFF, J.

[201 Md.App. 565] This appeal arises from a medical malpractice action. The issue presented involves the effect of a release agreement pursuant to the Maryland Uniform Contribution Among Joint Tort–Feasors Act (the “UCATA”), Md.Code (2006 Repl.Vol.) § 3–1401 to –1408 of the Courts and Judicial Proceedings Article (“C.J.P.”). The Circuit Court for Baltimore City, in two separate opinions, reached conflicting conclusions.

The initial lawsuit (the “Primary Action”) was filed in February 2005. Appellants, Wycinna and Christopher Spence, individually, and Ms. Spence, as the Personal

[30 A.3d 223]

Representative of the Estate of Caleb Spence (the “Spences”), filed suit against Emerson R. Julian Jr., M.D., Emerson R. Julian, [201 Md.App. 566] Jr., M.D., P.A., and Harbor City OB/GYN (collectively “Dr. Julian”) and Mercy Medical Center and its employees (“Mercy”) for injuries sustained by their son, Caleb Spence, prior to and during his birth. Before trial, Mercy and the Spences entered into a Confidential Settlement Release Agreement (the “ Release Agreement”), which provided that no other person would be entitled to a reduction of damages by reason of the settlement “unless and until” Mercy was “adjudicated to be [a] Joint Tortfeasor” with the other person. The Spences' claim proceeded to trial solely against Dr. Julian, and a jury found him liable for Caleb's injuries. The jury awarded damages in excess of $8 million; the award subsequently was reduced to $2,186.342.50, and Dr. Julian paid the full amount.

On April 17, 2009, the Spences filed a Complaint for Declaratory Judgment and Injunctive Relief. They asked the circuit court to declare that Dr. Julian was “barred from any right of contribution” from Mercy.

On June 15, 2009, Dr. Julian filed a claim against Mercy, asserting that Mercy was liable to him for contribution as a joint tortfeasor. Mercy moved to dismiss the claim, arguing that the Release Agreement it signed with the Spences in the original malpractice case precluded Dr. Julian from seeking contribution from Mercy.

Both cases were heard in the Circuit Court for Baltimore City, but the hearings took place before different judges. On November 25, 2009, in the declaratory judgment action, the court found that Dr. Julian had the right to file a claim for contribution against Mercy. On August 27, 2010, a different judge dismissed Dr. Julian's contribution claim against Mercy, finding that, pursuant to the Release Agreement, Mercy was relieved from liability to make contribution to Dr. Julian.

The Spences noted an appeal from the judgment of the circuit court in the declaratory judgment action. Dr. Julian appealed the court's order dismissing his complaint seeking contribution. The two cases were consolidated for appeal.

[201 Md.App. 567] The parties present multiple questions for our review,1 which we have consolidated and rephrased as follows:

Where a plaintiff enters into a settlement agreement with one defendant, pursuant to a release that provides that

[30 A.3d 224]

no other person is entitled to a reduction of damages by reason of the settlement unless the settling defendant is adjudicated a joint tort-feasor, does the nonsettling defendant have a right to pursue a claim for contribution in a separate proceeding filed after the conclusion of the underlying case?

For the reasons set forth below, we answer that question in the affirmative. Accordingly, we shall affirm the circuit court's order in the declaratory judgment action and reverse the judgment dismissing Dr. Julian's contribution claim against Mercy.

FACTUAL AND PROCEDURAL BACKGROUND
a. The Release Agreement and Primary Action

On February 15, 2005, the Spences filed a medical malpractice claim against Mercy and Dr. Julian. They alleged negligence,[201 Md.App. 568] wrongful death, and lack of informed consent in the labor and delivery of their son, Caleb, who suffered brain damage and died within one year.

On September 20, 2006, prior to trial, the Spences settled their claim against Mercy and entered into the Release Agreement. The Release Agreement discharged Mercy from all claims as a result of the Occurrence.2 It addressed the effect of the settlement on any award of damages the Spences might recover against Dr. Julian as follows:

7. Joint–Tortfeasor Nature of Agreement:

a. The [Spences] and the Released Parties agree and understand that this is a “ Swigert Release” as set out in the case of Swigert v. Welk, 213 Md. 613 [133 A.2d 428] (1957), and, in accordance with that decision and the Maryland Uniform Contribution Among Joint Tort–Feasors Act, [C.J.P.] § 3–1401 et seq. (1974, 2002 Repl.Vol.) (“the Act”) the Released Parties are neither deemed joint tortfeasors for purposes of this Release, nor are [the Spences] hereby releasing any other person or entity, whether or not a named party to this agreement. Any person or entity, other than the Released Parties, whom the [Spences] claim are liable to them for injuries, losses and damages which are the subject of this action shall not be entitled to any reduction of the damages the [Spences] are claiming against them by reason of the payment herein, unless and until the Released Parties have been adjudicated to be Joint Tortfeasors with said other person or entity. In the event the Released Parties are adjudicated to be Joint Tortfeasors liable to the [Spences] for damages, the [Spences] agree that their damages recoverable against all other tort-feasors, including but not limited to [Dr. Julian], will be reduced to the extent of the pro rata share of the Released Parties pursuant to the Maryland Uniform Contribution Among Joint Tort–Feasors Act, [C.J.P.] § 3–1405 (1974, 2002 Repl.Vol., 2005 Supp.). This provision is further intended[201 Md.App. 569] to relieve and protect the Released Parties from any liability for contribution to any person, firm, partnership or corporation.3

The release contained a provision for an escrow account to be maintained if the

[30 A.3d 225]

Spences obtained a judgment against Dr. Julian. It provided:

[The Spences] shall hold in escrow one half of the amount of such judgment (upon receipt of payment) in an interest bearing account. The escrowed funds are intended as security for the benefit of the Released Parties for any future indemnity payments that the [Spences] are obligated to pay to the Released Parties under this Release Agreement. Said funds shall be escrowed for three years from the date of the judgment or until [Dr. Julian's] claim for contribution has been extinguished.

The Release Agreement also contained an indemnity and hold harmless clause. It provided that the Spences would indemnify Mercy for any claims against it arising out of the Occurrence. The Release Agreement specifically stated that its purpose was

to limit forever the amount of money to be paid by the Released Parties in conjunction with the Occurrence.... to relieve the Released Parties from any liability to make contribution to or indemnify [Dr. Julian], or any other person or entity, in the event that the Released Parties are found to be tort-feasors liable for damages pursuant to the finding of any court of law.

Following the execution of the Release Agreement, the Spences filed a Stipulation of Voluntary Dismissal. It dismissed the “Complaint, and each and every Count therein, asserted against Defendant [Mercy], only,” with prejudice.

[201 Md.App. 570] Prior to trial, Dr. Julian moved to compel production of the Release Agreement, stating that he needed to review it to determine how to protect his claims against Mercy as a joint tortfeasor. Specifically, he stated:

[Pursuant to C.J.P. § 3–1404] a joint tort-feasor release permits Dr. Julian to reduce a judgment, if any, in this case by the greater of the amount of consideration paid by Mercy Medical Center, or the pro-rata share. If, however, the Release is not a joint tort-feasor Release, but rather, a Swigert Release, then Dr. Julian must know to decide whether or not to bring a contribution action against Mercy Medical Center by third-party claim or in a separate action. Dr. Julian would need to present evidence to the Court and jury as to whether the hospital is a joint tort-feasor under Maryland law to permit him the option of set-off. Judicial economy may dictate that the same jury that decides the liability, if any of Dr. Julian, also determine from the facts presented whether or not Dr. Julian and Mercy Medical Center are true joint tortfeasors with respect to the plaintiffs' alleged injuries.

Dr. Julian is entitled to know whether or not the Release between the plaintiffs and Mercy Medical Center gives rise to claims for contribution or results in automatic set-off. Dr. Julian is entitled to know the amount of the Release and Settlement to enable him to determine the extent of the set-off against him. If Dr. Julian learns that he must pursue a separate claim against Mercy Medical Center, then he will require the document in order to file an Amended Answer pursuant to Rule 2–323 of the Maryland Rules to assert the affirmative defense of Release.

In a letter dated October 6, 2006, counsel for Dr. Julian requested that the attorneys representing Mercy and the Spences withdraw the Stipulation of Voluntary Dismissal. Counsel for Dr. Julian stated: “Because it is my understanding that Mercy Medical Center has entered into...

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2 cases
  • Handy v. State
    • United States
    • Court of Special Appeals of Maryland
    • 26 Octubre 2011
  • Mercy Med. Ctr. v. Julian
    • United States
    • Maryland Court of Appeals
    • 27 Noviembre 2012
    ...defendant in the original action after it was dismissed as a party. The Court of Special Appeals consolidated both cases, 201 Md.App. 562, 566, 30 A.3d 220, 223 (2011), and we continue that joinder, to consider whether Dr. Julian may pursue, in a separate action, contribution against Mercy ......

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