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Wireless One, Inc. v. Mayor and City Council of Baltimore

Court of Appeals of Maryland

August 23, 2019

WIRELESS ONE, INC.
v.
MAYOR AND CITY COUNCIL OF BALTIMORE, ET AL.

          Argued: May 2, 2019

          Circuit Court for Baltimore City Case No. 24-C-17-003125

          Barbera, C.J. [*] Greene, McDonald, Watts, Hotten, Getty, Booth, JJ.

          OPINION

          WATTS, J.

         This case involves an action by a former tenant of a public market in Baltimore City to recover moving and relocation expenses under Md. Code Ann., Real Prop. (1974, 2015 Repl. Vol.) ("RP") § 12-205(a) and for an alleged unconstitutional taking. Under RP § 12-205(a), "[w]henever a program or project undertaken by a displacing agency will result in the displacement of any person, the displacing agency shall make a payment to the displaced person, on proper application as approved by the displacing agency for[, ]" among other things, the "[a]ctual reasonable expenses" of moving and searching for a replacement business, and for "[a]ctual direct loss of tangible personal property as a result of moving or discontinuing a business[.]" Whether a person is entitled to moving and relocation expenses under RP § 12-205(a) depends on whether the person is a "displaced person," as defined in RP § 12-201(e). To state the obvious, if a person is not a "displaced person," as that term is statutorily defined, then the person seeking compensation is not entitled to moving and relocation expenses under RP § 12-205(a).

         RP § 12-201(e) defines a "displaced person" as follows:

(1) "Displaced person" means:
(i) Any person who moves from real property, or moves his [or her] personal property from real property:
1. As a direct result of a written notice of intent to acquire or the acquisition of such real property in whole or in part by a displacing agency; or
2. On which that person is a residential tenant or conducts a small business, a farm operation, or a nonprofit organization, in any case in which the head of the displacing agency determines that displacement is permanent, as a direct result of rehabilitation, demolition, or other displacing activity as the lead agency may prescribe, undertaken by a displacing agency; and
* * *
(2) "Displaced person" does not include:
(i) Except to the extent that this exclusion conflicts with federal financial participation requirements, any person who, on the open market, without threat of condemnation, sells his [or her] real property to a displacing agency;
(ii) Unlawful occupants, or anyone occupying such dwelling for the purpose of obtaining assistance under this subtitle; or
(iii) A person who leases from the displacing agency after the displacing agency takes title to the real property, or any person other than a person who was an occupant of such property at the time it was acquired who occupies the property on a rental basis for a short term or period subject to termination when the property is needed for the program or project.

         In this case, Baltimore City has owned and operated the market since 1847. From 2004 to February 2017, the tenant leased space in the market; as of 2016, the tenant's lease was on a month-to-month basis. In late 2016, a rental agent for the market advised the tenant that its business did not "fit in the [redevelopment] plans" for the market and that it "should pursue other options[.]" In February 2017, the tenant vacated the market. In June 2017, the tenant sued, seeking compensation for moving and relocation expenses as a displaced person and for an alleged unconstitutional taking. The defendants filed a motion to dismiss, which the trial court granted, concluding that the former tenant did not qualify as a "displaced person" because of the exemption in RP § 12-201(e)(2)(iii). The Court of Special Appeals affirmed the trial court's judgment, agreeing that the exemption in RP § 12-201(e)(2)(iii) applies and that the former tenant was not a "displaced person." Against this backdrop, we must decide whether the former tenant is a "displaced person," as that term is defined in RP § 12-201(e)(1)(i), whether the exemption in RP § 12-201(e)(2)(iii) applies, and whether the tenant has stated a claim for an unconstitutional taking.

         We hold that the former tenant is not a "displaced person," as that term is defined in RP § 12-201(e)(1)(i), because it voluntarily terminated its lease and abandoned its stall at the market before action by the defendants to terminate the lease and before any redevelopment occurred. The former tenant left its stall at the market on its own accord before any action to terminate the lease, other than the advisement that it would "not fit in the [redevelopment] plans" for the market and that it should pursue other options. Thus, the former tenant does not qualify as a "displaced person" under the plain language of RP § 12-201(e)(1)(i), and it was not entitled to moving and relocation expenses under RP § 12-205(a). In addition to concluding that the former tenant is not a "displaced person" under the plain language of RP § 12-201(e)(1)(i), we hold that the tenant is not a "displaced person" because it "lease[d] from the displacing agency after the displacing agency [took] title to the real property[.]" RP § 12-201(e)(2)(iii). Applying the plain and unambiguous language of RP § 12-201(e)(2)(iii)-that a person who leases from a displacing agency after the displacing agency takes title to the real property is not a displaced person- inescapably leads to the conclusion that the tenant is not a displaced person, as it undisputedly entered into its lease well after the displacing agency took title to the market. Although unnecessary to resort to a review of the legislative history, our holding concerning the plain language of RP § 12-201(e)(2)(iii) is fully supported by the legislative history, and the legislative history does not compel a contrary interpretation. As such, we hold that the tenant was not wrongfully denied moving and relocation expenses, and there was no unconstitutional taking. Accordingly, we affirm the Court of Special Appeals's judgment.

         BACKGROUND

         In 1847, the Cross Street Market ("the Market") was established in Baltimore City. At all times since 1847, the Mayor and Council of Baltimore City ("the City"), Respondent, has owned and operated the Market. In 1994, the City established the Baltimore Public Markets Corporation ("the Markets Corporation"), Respondent, to assist with the regulation, control, and maintenance of the Market and other public markets in Baltimore City. In 2004, Wireless One, Inc. ("Wireless One"), Petitioner, began leasing a stall in the Market from the City.[1] Wireless One's business consisted of leasing cell phones and related equipment, such as chargers. As of 2016, Wireless One's lease was a month-to-month lease.

         On November 9, 2016, through the Markets Corporation, the City entered into a management agreement with CSM Ventures, LLC ("CSM"), a subsidiary of Caves Valley Partners ("Caves"), to operate and redevelop the Market. The management agreement authorized CSM to lease portions of the Market and terminate existing tenancies. Under the management agreement, the Markets Corporation was required to pay CSM $2 million to redevelop and operate the Market.

         It is undisputed that, in late 2016, Wireless One was advised that it would not fit into the plans for the redeveloped Market, and that it should pursue other options. On December 21, 2016, on behalf of CSM and Caves, a representative sent an e-mail message to Wireless One and other Market tenants concerning the redevelopment of the Market. In the e-mail, the representative stated, in pertinent part:

[O]n January 9th, most of you will receive a Letter of Intent, along with current draft space plans for the new [M]arket, for your review and consideration as prospective tenants. There are a very limited number of tenants who we know will not fit in the plans. Those tenants have been informed that they should pursue other options going forward. . . .
At the merchants['] meeting last month, Arsh Mirmiran from CSM [] promised that the current [M]arket would continue to operate until at least April 1, 2017. I would like to reiterate that and let you know that it will likely continue for a bit longer than that. Once we know an official date, we will let you all know.
***
Regardless of whether or not we are able to reach agreement for you to be part of the redeveloped [M]arket, we will work with you and the [] Markets Corporation to provide options for temporary and/or permanent relocation spaces. These spaces would be in either Lexington Market or Hollins Market, both of which are going to be refreshed, as well. The Markets Corp[oration] has confirmed that there is adequate space to accommodate all current tenants of [the] Market, should you so choose. If neither of those options is of interest, I can work directly with you to find you space closer to Cross Street, either in currently vacant storefronts or in existing spaces that may become available.
***
As I mentioned, please let me know if you'd like any additional information. All of this is still a work in progress and we don't have all the answers yet, but we are methodically getting there and we appreciate your continued interest and patience.

         According to an affidavit from Arsh Mirmiran, a partner at Caves, on or around January 24, 2017, a Wireless One representative requested to terminate Wireless One's month-to-month lease and to vacate the stall at the Market by February 1, 2017, with the agreement that Wireless One would not be billed for February 2017 rent. Mirmiran averred that management agreed with Wireless One's request. On February 8, 2017, Wireless One vacated the Market. At that time, Wireless One removed all of its inventory, but left the physical stall, including counters and storage shelves, which were affixed to the stall and unable to be removed.

         Circuit Court Proceedings

         On June 2, 2017, in the Circuit Court for Baltimore City, Wireless One filed a complaint against Respondents, alleging that it was a "displaced person," as defined by RP § 12-201(e)(1), that Respondents were displacing agencies as defined by RP § 12-201(f), and that it was entitled to moving and relocation expenses under RP § 12-205(a). Wireless One also alleged that there had been an unconstitutional taking of its property without compensation, in violation of the United States and Maryland Constitutions. As to the circumstances surrounding its vacating of the Market, in the complaint, Wireless One alleged that it "was informed that it would not fit in the plans for the redeveloped [M]arket and that it should pursue other options[, ]" and that it "vacated the [M]arket on February 8, 2017." Wireless One alleged that "[i]t removed the cell[ ]phone inventory but left the physical stall consisting of counters, storage shelves, etc., since they were built in and not able to be moved."

         On July 11, 2017, Respondents filed a motion to dismiss, or, in the alternative, for summary judgment, arguing, among other things, that Wireless One was not a "displaced person" because Wireless One terminated its lease voluntarily and because of the exemption in RP § 12-201(e)(2)(iii), and that there was no taking. Respondents contended that Wireless One did not meet the definition of a "displaced person" under RP § 12-201(e)(1) because Wireless One "walked away from its month-to-month lease voluntarily." According to Respondents, although Wireless One "may have been informed that it would not fit into some future plans for a new, redesigned [M]arket [], the threat of redevelopment alone [was] not sufficient for [Wireless One] to be considered a displaced person that [was] entitled to moving and relocation expenses." (Citation omitted). Respondents argued that Wireless One had failed to allege that rehabilitation had occurred or been undertaken, that Respondents had "made any sort of effort to evict [Wireless One] from the Market in pursuit of [] renovation[, ]" or that there had been written notice of an intent to acquire or acquisition of the real property. Respondents asserted that, moreover, Wireless One was "exempt from the definition of 'displaced person'" under RP § 12-201(e)(2)(iii) because it leased the stall in the Market after the City acquired title to the Market. Respondents attached as an exhibit to the motion Mirmiran's affidavit, dated July 6, 2017, in which he averred, in pertinent part:

[] On or around January 24, 2017, a representative from Wireless One[] contacted representatives of management and requested to terminate the month-to-month lease and vacate the stall by February 1, 2017, with the agreement that they would not be billed for February rent.
[] Management agreed, and Wireless One[] voluntarily vacated the premises in February 2017.
[] CSM [] did not terminate Wireless One's lease, nor did it notify Wireless One[] that it had to leave by a date certain.
[] While CSM [] eventually plans to renovate [the] Market, it has not yet begun to do so, nor has it terminated the leases of any tenants in pursuit of this project; in fact, all remaining tenants were offered, and agreed to, lease renewals through September 5, 2017. Wireless One[] was not offered this lease renewal because it had already vacated the [M]arket at that time.
[] While the items left behind by Wireless One[] are fixtures, it is welcome to return and remove the items. CSM [] has no plans to utilize the fixtures for the public use.

         On September 11, 2017, the circuit court conducted a hearing on the motion and heard argument from the parties. On the same day, the circuit court issued an order granting the motion and dismissing the complaint. In the order, the circuit court explained that it agreed with Respondents' argument that the exemption in RP § 12-201(e)(2)(iii) applied, stating:

In the instant case, it is undisputed that the Market was established by [the] City in 1847, and has been owned and operated by [the] City since its inception. [Wireless One] cannot overcome the plain language of [RP] § 12-201(e)(2)(iii), which specifically exempts "[a] person who leases from the displacing agency after the displacing agency takes title to the real property." [Wireless One]'s lease was executed in 2004, many years after [the] City acquired title to the Market. Additionally, the Management Agreement between [the] City and Caves [] did not transfer title to the Market; rather, the Management Agreement merely gave Caves [] the ability to operate, manage, and redevelop the Market. Thus, [Wireless One] has failed to state a claim for relocation and moving expenses pursuant to [RP] § 12-20[5(a)].

(Emphasis and some alterations in original). The circuit court also ruled that "no taking ha[d] occurred" because Wireless One was "not within the class of persons entitled to relief under [RP] § 12-20[5(a)]." The circuit court rejected Wireless One's argument that there was a taking because its fixtures became valueless, explaining that Mirmiran averred that Wireless One was "welcome to return and remove the items[, ]" and that, "[i]t [was] quite clear, then, that [Wireless One] abandoned its property affixed to the Market."[2]

         On September 20, 2017, Wireless One filed a motion to alter or amend, which the circuit court denied.

         Appellate Proceedings

         Wireless One appealed.[3] On December 21, 2018, in a reported opinion, the Court of Special Appeals affirmed the circuit court's judgment.[4] See Wireless One, Inc. v. Mayor and City Council of Baltimore City, 239 Md.App. 687, 689, 198 A.3d 892, 893 (2018). The Court of Special Appeals quoted with approval the circuit court's reasoning that the exemption in RP § 12-201(e)(2)(iii) applied, holding: "We agree with the [circuit] court's analysis." Wireless One, 239 Md.App. at 695, 198 A.3d at 896-97 (footnote omitted). The Court of Special Appeals also determined that, because "the City did not wrongfully deny Wireless [One] moving and relocation expenses, . . . the [circuit] court did not err in ruling that Wireless [One] 'ha[d] failed to state a claim for an unconstitutional taking.'" Id. at 696, 198 A.3d at 897.

         On December 27, 2018, Wireless One petitioned for a writ of certiorari, raising the following two issues:

[1.] Under [RP §] 12-201[(e)](1)(i)(2), is a person who leaves a publicly funded facility as a result of demolition or rehabilitation excluded from relocation benefits if it leased after the unit of government acquired title to the real property?
[2.] Has Wireless [One] stated a claim for an unconstitutional taking?

         On February 4, 2019, this Court granted the petition. See Wireless One v. Mayor and City Council of Baltimore, 462 Md. 556, 201 A.3d 1228 (2019).

         On May 2, 2019, this Court heard oral argument in the case. At oral argument, questions arose concerning the statutory construction and legislative history of RP §§ 12-201 and 12-205. On May 3, 2019, this Court issued an order authorizing the Attorney General to file an amicus brief. In the order, we stated:

Whereas, this appeal involves construction of the relocation and assistance provisions of [RP] § 12-201 et seq.[, ] an issue in which the State may have an interest, and pursuant to Maryland Constitution, Art. V, § 6, it is this 3rd day of May[, ] 2019,
ORDERED, by the Court of Appeals of Maryland, pursuant to Maryland Rule 8-511(a)(3), that the Attorney General may file a brief in the above-captioned case as Amicus Curiae concerning the appropriate construction of [RP] § 12-201 et seq.

         On June 12, 2019, the Attorney General filed an amicus brief. In the amicus brief, the Attorney General contended that RP § 12-201(e)(2)(iii) is ambiguous, that there is a "latent ambiguity" in the definition of "displacing agency" in RP § 12-201(f), and that RP § 12-201 should be construed consistently with the counterpart federal statute. The Attorney General argued:

With respect to the appropriate construction of [RP] § 12-201(e)(2)(iii), which excludes from the definition of "displaced person" a "person who leases from the displacing agency after the displacing agency take[s] title to the real property," that provision should be construed consistently with its federal counterpart, 42 U.S.C. § 4601(6)(B)(ii), such that this exclusion is only applicable in those cases in which the displacing agency has acquired property for a program or project (and any lease has taken effect after such acquisition).

         On July 2, 2019, Respondents filed a reply to the amicus brief, contending that the language of RP § 12-201(e)(2)(iii) is plain and unambiguous, that the Attorney General's interpretation of the provision conflicts with the statute's plain language and legislative history, and that the Attorney General's reading of the legislative history is "flawed." We set forth the contentions raised in the amicus and reply briefs in greater detail below.

         DISCUSSION

         The Parties' Contentions

         Wireless One contends that the circuit court erred in granting the motion to dismiss because, under RP § 12-201(e)(1)(i)(2), "a person who leaves a publicly funded facility as a result of demolition or rehabilitation is not excluded from relocation benefits if it leased after the unit of government acquired title to the real property." In other words, Wireless One argues that it qualified as a "displaced person" under RP § 12-201(e)(1)(i)(2). Wireless One asserts that the City was not a "displacing agency" because it was not carrying out a public works project, or a project with State financial assistance, when the City established the Market in 1847. Wireless One maintains: "Applying the test of [RP §] 12-201(f), it is clear that the [circuit] court [erred] when it applied the exclusion of [RP §] 12-201[(e)](2) to the City's establishment of the [] Market in [1]847 simply on the basis of the City's ownership in [1]847." Wireless One contends that the circuit court's interpretation of the relevant statutes essentially renders compensation for moving and relocation expenses under RP § 12-205(a) a "nullity" because someone in Wireless One's position-i.e., a tenant who entered into a lease after the lessor acquired title-would never be able to recover.

         Respondents counter that the circuit court properly dismissed the complaint for failure to state a claim upon which relief could be granted. Respondents contend that Wireless One is not entitled to relocation expenses because it is not a "displaced person" under RP § 12-201(e). Specifically, Respondents argue that, under the plain language of RP § 12-201(e)(2)(iii), Wireless One is excluded from the definition of "displaced person," as it is undisputed that Wireless One leased the Market stall from the City more than 150 years after the City acquired title to the Market. Respondents assert that the applicability of RP § 12-201(e)(2) does not depend on when the lessor became a "displacing agency," because nothing in that provision "requires the City to have been a displacing agency at the time it acquired title to trigger the exception." (Emphasis omitted). Respondents maintain that, because the plain language of RP § 12-201(e) is clear and unambiguous, this Court need not go further, but Respondents also contend that the legislative history "confirms that the definition of 'displaced person' excludes anyone who leases after the government takes title to the property, regardless of whether the government was a 'displacing agency' at the time it took title."

         Respondents assert that interpreting RP § 12-201(e)(2) in the manner in which the circuit court and Court of Special Appeals did, and applying it in this case, does not create a legal nullity, as there may be persons who enter into leases before a displacing agency takes title. Respondents contend that, even if RP § 12-201(e)(2) does not bar recovery, dismissal of the case was nevertheless proper because Wireless One's relocation was not the result of a displacement due to a program or project undertaken by the City, but instead was the result of its own unilateral decision to terminate its lease. Respondents argue that, although the City owned the Market at the time that "Wireless One abandoned the premises, its rehabilitation was far from certain. And[, ] during that time, either party could have terminated the month-to-month tenancy, for any reason, with a mere thirty days' notice." (Footnote omitted). As such, Respondents assert that "Wireless One's voluntary departure could not have been the 'direct result' of rehabilitation[, ]" as required to recover moving and relocation expenses under RP § 12-205(a).

         Standard of Review

         Recently, in Floyd v. Mayor and City Council of Balt., 463 Md. 226, 241, 205 A.3d 928, 937 (2019), we stated that "we review without deference a trial court's grant of a motion to dismiss," explaining:

Considering a motion to dismiss a complaint for failure to state a claim upon which relief may be granted, a court must assume the truth of, and view in a light most favorable to the non-moving party, all well-pleaded facts and allegations contained in the complaint, as well as all inferences that may reasonably be drawn from them, and order dismissal only if the allegations and permissible inferences, if true, would not afford relief to the plaintiff, i.e., the allegations do not state a cause of action for which relief may be granted. Consideration of the universe of "facts" pertinent to the court's analysis of the motion are limited generally to the four corners of the complaint and its incorporated supporting exhibits, if any. The well-pleaded facts setting forth the cause of action must be pleaded with sufficient specificity; bald assertions and conclusory statements by the pleader will not suffice. Upon appellate review, the trial court's decision to grant such a motion is analyzed to determine whether the court was legally correct.

(Citation omitted). And,

[s]imilarly, where, in considering a motion to dismiss, a trial court considers materials, such as affidavits, outside of the complaint (i.e., the complaint and documents attached thereto), we treat the trial court's grant of a motion to dismiss as a grant of summary judgment, and we review the matter without deference for legal correctness.

Id. at 241, 205 A.3d at 937 (citation omitted).

         Statutory Construction

         In Lillian C. Blentlinger, LLC v. Cleanwater Linganore, Inc., 456 Md. 272, 294-95, 173 A.3d 549, 561-62 (2017), "we set forth the relevant rules of statutory construction[, ]" stating:

The cardinal rule of statutory construction is to ascertain and effectuate the intent of the General Assembly.
As this Court has explained, to determine that purpose or policy, we look first to the language of the statute, giving it its natural and ordinary meaning. We do so on the tacit theory that the General Assembly is presumed to have meant what it said and said what it meant. When the statutory language is clear, we need not look beyond the statutory language to determine the General Assembly's intent. If the words of the statute, construed according to their common and everyday meaning, are clear and unambiguous and express a plain meaning, we will give effect to the statute as it is written. In addition, we neither add nor delete words to a clear and unambiguous statute to give it a meaning not reflected by the words that the General Assembly used or engage in forced or subtle interpretation in an attempt to extend or limit the statute's meaning. If there is no ambiguity in the language, either inherently or by reference to other relevant laws or circumstances, the inquiry as to legislative intent ends.
If the language of the statute is ambiguous, however, then courts consider not only the literal or usual meaning of the words, but their meaning and effect in light of the setting, the objectives, and the purpose of the enactment under consideration. We have said that there is an ambiguity within a statute when there exist two or more reasonable alternative interpretations of the statute. When a statute can be interpreted in more than one way, the job of this Court is to resolve that ambiguity in light of the legislative intent, using all the resources and tools of statutory construction at our disposal.
If the true legislative intent cannot be readily determined from the statutory language alone, however, we may, and often must, resort to other recognized indicia-among other things, the structure of the statute, including its title; how the statute relates to other laws; the legislative history, including the derivation of the statute, comments and explanations regarding it by authoritative sources during the legislative process, and amendments proposed or added to it; the general purpose behind the statute; and the relative rationality and legal effect of various competing constructions.
In construing a statute, we avoid a construction of the statute that is unreasonable, illogical, or inconsistent with common sense.
In addition, the meaning of the plainest language is controlled by the context in which it appears. As this Court has stated, because it is part of the context, related statutes or a statutory scheme that fairly bears on the fundamental issue of legislative purpose or goal must also be considered. Thus, not only are we required to interpret the statute as a ...

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