Ms. Ferguson amended the complaint, naming the State as a defendant and specifying that Ms. Loder was acting within the scope of her employment with the State. Ms. Ferguson then filed a Motion to Substitute Party by Interlineation, arguing that Maryland's workers' compensation statute extended the Maryland Tort Claims Act ("MTCA") filing deadline by two months, for plaintiffs filing workers' compensation claims. The Circuit Court for Baltimore City granted the State's motion to dismiss the amended complaint on the ground that Ms. Ferguson failed to meet the MTCA's three year filing deadline. Ms. Ferguson appealed the dismissal.

The MTCA requires tort actions against the State to be filed within three years after the cause of action arises. Md. Code Ann., State Gov't §12-106(b). It is well settled that the three year filing requirement of the MTCA is not a statute of limitations but rather a condition precedent to the initiation of an action under the MTCA, as such the statute of limitations' tolling principles are inapplicable to the MTCA filing requirement. The main distinction between the two time restricted rights is that a condition precedent is an action that must be taken prior to filing a lawsuit and a statute of limitations is a period of time within which a lawsuit must be filed.

However, Ms. Ferguson argued that she was not attempting to apply tolling principles to the MTCA, she contended that her grounds for relief were based upon the theories that (1) the workers' compensation statute extends the MTCA deadline by two months; (2) the amendment substituting the State for its employee relates back to the original filing date; and (3) the action substantially complied with the MTCA because the State had notice of the claim and the Attorney General's office answered the complaint on behalf of the State employee within the three-year filing period.

The Court of Special Appeals held that the workers' compensation statute, which suspends, for 60 days, the limitations period for individuals filing workers compensation claims, does not apply broadly to all time restricted rights, or conditions precedent, but rather only applies to statutes of limitations. In support of its holding the Court of Special Appeals noted that the MTCA was not enacted until thirty years after the tolling provision of the Workers' Compensation Act.

The court further held that the addition of a new party does not relate back to the filing date of the original complaint because failure to meet a condition precedent extinguishes the right itself. Specifically, when Ms. Ferguson failed to file her claim against the State within the time period prescribed by the MTCA, she lost her right to sue the State; therefore, there was no cause of action to which it could relate back.

As to the issue of substantial compliance, the court stated that substantial compliance has been defined as communication that provides the State requisite notice of facts and circumstances giving rise to the claim. The court went on to state that the primary purpose of the notice requirement is to permit the State to conduct a timely investigation of the incident and to respond to the claim. The court held that Ms. Ferguson did not substantially comply with the MTCA because an untimely submission of notice amounts to an outright failure to comply. The court stated that there is little difference between an untimely notice and a complete failure to provide notice. Ms. Ferguson was not permitted to use "substantial compliance" as a license to ignore the clear mandate of the MTCA.