On October 14, 2003, Plaintiffs filed a Complaint in which
they asserted that Dr. Hariri had breached a covenant not to compete in a
contract under seal that was signed by the parties on October 3, 2000. Dr.
Hariri was never served with a copy of that Complaint. On February 7, 2005,
Plaintiffs filed a second Complaint in which they asserted that Dr. Hariri and
five other defendants had breached the same covenants not to compete, signed
under seal. Three of the defendants to the second Complaint were served by
certified mail with a copy of the Complaint. Those defendants included: 1.) Dr.
Hariri, served on September 6, 2007, approximately 2½ years after the second
Complaint was filed; 2.) Dr. Thomas Blaik, served on September 6, 2007,
approximately 2½ years after filing of the second Complaint; and, 3.) Dr. Belle,
served on October 3, 2007, approximately 2½ years after filing of the second
Complaint.
On September 14, 2007, the Clerk issued a notification to
parties of contemplated dismissal pursuant to MD. RULE 2-507. The notice
required that within thirty (30) days, parties must show good cause to defer
entry of an order of dismissal. A variety of other filings followed including:
- September 19, 2007 – Dr. Hariri filed Answer to Complaint
- October 15, 2007 – Plaintiffs filed Motion to Defer Dismissal under
MD. RULE 2-507
- October 29, 2007 – Dr. Blaik filed Motion to Dismiss Complaint with Prejudice for Failure to State a Claim Upon Which Relief can be Granted and Request for Sanctions
- November 6, 2007 – Dr. Belle filed an Answer to Complaint
- November 13, 2007 – Plaintiffs filed six count Amended Complaint
Finally, on November 15, 2007 Dr. Hariri and Dr. Hatfield
filed a Motion to Dismiss for Lack of Prosecution Pursuant to MD. RULE 2-507©.
In that filing, the parties requested dismissal with prejudice.
After a hearing, the Circuit Court held that the case be
dismissed without prejudice. Drs. Hariri, Hatfield and Blaik appealed to the
intermediate appellate court, but the Court of Appeals took certiorari before
the Court of Special Appeals even had an opportunity to hear or rule on the
case. The issue was whether the trial court erroneously determined that it
lacked the authority to grant dismissal with prejudice pursuant to MD. RULE
2-507, when the defendant was belatedly served and the Court failed to dismiss
the action pursuant to MD. RULE 2-507©.
When an action is dismissed pursuant to MD. RULE 2-507, the
plain language of the Rule expressly provides that dismissal be entered "without
prejudice." In pertinent part, the Rule provides:
(b) For lack of jurisdiction.- An action against any
defendant who has not been served or over whom the court has not otherwise
acquired jurisdiction is subject to dismissal as to that defendant at the
expiration of 120 days from the issuance of original process directed to that
defendant.
(c) For lack of prosecution.- An action is subject to
dismissal for lack of prosecution at the expiration of one year from the last
docket entry, other than an entry made under this RULE, RULE 2-131, or RULE
2-132, except that an action for limited divorce or for permanent alimony is
subject to dismissal under this section only after two years from the last such
docket entry.
(d) Notification of contemplated dismissal.- When an action
is subject to dismissal pursuant to this RULE, the clerk, upon written request
of a party or upon the clerk’s own initiative, shall serve a notice on all
parties pursuant to RULE 1-321 that an order of dismissal for lack of
jurisdiction or prosecution will be entered after the expiration of 30 days
unless a motion is filed under section (e) of this Rule.
(e) Deferral of dismissal.- On motion filed at any time
before 30 days after service of the notice, the court for good cause shown may
defer entry of the order of dismissal for the period and on the terms it deems
proper.
The purpose of the rule is not meant to punish Plaintiffs
for action or inaction, but rather to rid the docket of stale cases. The
contract in question was executed under seal. The statute of limitations
applicable to these actions is twelve (12) years. Accordingly, Plaintiff could
have brought this lawsuit as late as 2008 and still would have been within the
applicable statute of limitations. Even if the Clerk had entered dismissal for
lack of service at the first opportunity, the Plaintiffs had ample time to
re-file.
Accordingly, the Court of Appeals held that only a dismissal
without prejudice can be had pursuant to MD. RULE 2-507 and affirmed the trial
court’s ruling.
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