Law Updates


Court of Appeals Clarifies Scope of Its Rulemaking Authority and Addresses the Constitutionality of Its Newly Codified Emergency Powers

(June 8, 2022) Matthew McCloskey, Associate.

In Jesse J. Murphy v. Liberty Mutual Insurance Company, __ Md. __, Misc. No. 5., Sept. Term 2021 (April 27, 2022), the Court of Appeals for the first time addressed the constitutionality of the emergency powers that it conferred upon itself by way of additions to the Maryland Rules in the early days of the COVID-19 pandemic. The Court clarified the scope of its own rulemaking authority and confirmed that it possesses the power to toll the statute of limitations during the pendency of certain emergencies affecting the judiciary.

In March and April of 2020, in response to the then-burgeoning COVID-19 pandemic, the Chief Judge of the Court of Appeals of Maryland issued a series of administrative orders addressing Court operations during the pandemic. On March 13, 2020, the Chief Judge issued an order closing all courthouses in Maryland to the public, and on March 16, 2020, the Chief Judge issued an order closing clerks’ offices around the State, subject to only a few limited exceptions.

During the same time period, the Standing Committee on Rules of Practice and Procedure (“Rules Committee”) met to consider, and ultimately pass, several new rules granting emergency powers to the Chief Judge. Specifically, on or about March 13, 2020, the Rules Committee recommended the adoption of rules now codified at Maryland Rules 16-1001 et seq. On or about March 16, 2020, the Court of Appeals adopted the Rules Committee’s proposed new rules, including Rule 16-1003, which provides in pertinent part as follows:

Upon a determination by the Chief Judge of the Court of Appeals that an emergency declared by the Governor or an event within the scope of Rule 16-1001(b) significantly affects access to or the operations of one or more courts or other judicial facilities of the State or the ability of the Maryland Judiciary to operate effectively, the Chief Judge, by Administrative Order, may, to the extent necessary:

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(2) suspend the operation of Rules that cannot be implemented as intended because of the emergency or even

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(7) suspend, toll, extend, or otherwise grant relief from time deadlines, requirements, or expirations otherwise imposed by applicable statutes, Rules, or court orders, including deadlines for appeals or other filings, deadlines for filing or conducting judicial proceedings, and the expiration of injunctive, restraining, protective, or other orders that otherwise would expire, where there is no practical ability of a party subject to such deadline, requirement, or expiration to comply with the deadline or requirement or seek other relief;

(8) suspend any judicial business that is deemed not essential by the Chief Judge or close a court entirely when necessary;

(9) triage cases and categories of cases with respect to expedited treatment;

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(14) take any other appropriate action necessary to ensure that, to the maximum extent possible, essential judicial business is effectively handled by the courts.

 

Md. Rule 16-1003(a).

The cumulative effect of the Court of Appeals’ administrative orders in March of 2020 had the potential to prevent litigants from filing cases. Therefore, on or about April 3, 2020, the Chief Judge issued another administrative order providing that:

[A]ll statutory and rules deadlines related to the initiation of matters required to be filed in a Maryland state court, including statutes of limitations, shall be tolled or suspended, as applicable, effective March 16, 2020, by the number of days that the courts are closed to the public due to the COVID-19 emergency by order of the Chief Judge of the Court of Appeals[.]

The April 3 order further provided that “such deadlines shall be extended by a period to be described in an order by the Chief Judge of the Court of Appeals terminating the COVID-19 emergency period.” The Chief Judge issued several clarifications and amendments to this order in the months following its initial issuance. Collectively, these orders are referred to as the “tolling order.”

The constitutionality of the Chief Judge’s tolling order was immediately challenged by the defendant in the instant lawsuit. On or about July 20, 2020, the plaintiff, Liberty Mutual, sued the defendant, Murphy Enterprises, in the United States District Court for the District of Maryland seeking remuneration for certain payments made between February and August 2017. Murphy Enterprises moved to dismiss the lawsuit for lack of subject matter jurisdiction, arguing that portions of the payments were made more than three years before the lawsuit was filed and therefore were time-barred under Maryland law. Accordingly, it argued that Liberty Mutual’s claim did not reach the federal court diversity jurisdictional minimum of $75,000. Liberty Mutual responded that its claims were timely because the statute of limitations had been tolled by the tolling order, and Murphy Enterprises argued in response that the tolling order exceeded the Court of Appeals’ constitutional authority. Because the issue raised by the parties presented a novel question of Maryland law, the District of Maryland certified the question of law to the Court of Appeals.

The Court of Appeals held that the tolling order was constitutional and validly issued by the Chief Judge. Initially, the Court noted that the Chief Judge had authority under the State Constitution and Rule 16-1003(a) to issue the tolling order. The Court described that “[t]he State Constitution provides that the ‘Chief Judge . . . shall be the administrative head of the Judicial system of the State.’ Article IV, §18(b)(1).” The State Constitution further provides that “[t]he powers of the Chief Judge set forth in [§18] shall be subject to any rule or regulation adopted by the Court of Appeals.” Id. at §18(b)(5). This provision refers, in turn, to Article IV, §18(a), which vests rulemaking authority in the Court of Appeals: “[t]he Court of Appeals from time to time shall adopt rules and regulations concerning the practice and procedure in and the administration of the appellate courts and in the other courts of this State.” The parties did not dispute that Rule 16-1003(a) was promulgated and adopted pursuant to a valid exercise of the Court of Appeals’ authority. Thus, the Court concluded that the tolling order was issued pursuant valid legal authority.

A separate issue was “the order – and presumably the rules on which it was based – overreached the authority of the Judiciary by offending other provisions of the Maryland Constitution, in particular, Articles 8 and 9 of the Maryland Declaration of Rights.”

The Court first addressed whether the tolling order and Rule 16-1003 comported with the separation of powers guaranteed by Article 8 of the Maryland Declaration of Rights. The Court emphasized that “The Maryland Constitution recognizes on its face that the powers of the three branches of State government are often and inevitably intertwined.” Thus, to determine whether the action of one branch impermissibly intrudes upon the powers of another, “the Court has looked to whether the branch whose power was challenged was ‘usurping” a power of another branch[, . . .] whether the performance of a function by one branch ‘encroach[ed]’ on the other branch’s powers, [] and whether the branch in question had ‘a significant role’ in the subject of the action, or whether, by contrast, that subject lay ‘solely and exclusively within the purview of [a different] branch.’” (Internal citations omitted). Particularly in the field of judicial rules, the Court noted that such rules must pertain to “practice and procedure,” as opposed to rules that “add[] a substantive element” to a law enacted by the General Assembly.

The Court concluded that Maryland law had long held that statutes of limitation were considered procedural, not substantive, principles of law. For this reason, Maryland’s Courts have long adopted principles and legal rules governing the proper application of statutes of limitation. In particular, the Court noted that it has adopted principles such as the discovery rule and the concept of judicial tolling, each of which amounts to judicially created rules tolling the statute of limitations. Therefore, the Court concluded that the tolling order fell within a power possessed by the judiciary, and that the exercise of that power did not impermissibly intrude upon any power possessed by another branch of the State Government. Further, the Court concluded that the tolling order was consistent with the Chief Judge’s power as the administrative head of the judiciary, and was issued in coordination with the actions of the other branches of government in  the course of the State Government’s response to the COVID-19 pandemic.

Finally, the Court concluded that the tolling order did not violate the prohibition against the suspension of laws set forth in Article 9 of the Declaration of Rights. Article 9 of the Maryland Declaration of Rights provides “[t]hat no power of suspending Laws or the execution of Laws, unless by, or derived from the Legislature, ought to be exercised, or allowed.” Interpreting this provision for the first time in history, the Court of Appeals accepted as persuasive the rationale from early-twentieth century legal commentator Alfred S. Niles, who believed that “Article 9 fell into a category of ‘(d)eclarations of abstract principles whose sole practical effect is to declare from what standpoint the law shall be considered and in what spirit interpreted …. [I]n reality they amount to little more than a statement as to the point of view from which the court is expected to look at any particular concrete question.’” Alfred S. Niles, Maryland Constitutional Law (Hepbron & Haydon 1915). Viewed in harmony with the provisions of the State Constitution authorizing the Court of Appeals to adopt rules and regulations, and because the Court had already concluded that the tolling order was adopted pursuant to a valid exercise of those powers, the Court concluded that the tolling order did not amount to the suspension of any law.

Author Recommendation: Attorneys should be aware that the Court of Appeals now possesses broad powers to respond to emergencies, codified in Title 16 of the Maryland Rules, including in ways that may affect the application of statutorily mandated deadlines.