Read the opinion in the case of Norino Properties v. Balsamo, an uploaded document in Assignments in Blackboard, and write five hundred (500) words on this case including the following: A. Take a position pro (agree)or con (disagree) on this decision and explain why and upon what legal principles you rely (look in your text book if you want help); B. What did the court hold and why; C. What did the court do with the case procedurally and what do you think that means for the case after this opinion, e.g. where do the parties go from here; D. What judge wrote the majority opinion; E. Were there minority, concurring or dissenting opinions and which judges wrote those opinions; F. What was the difference between the majority opinion and any minority, concurring or dissenting opinions; G. What court issued this opinion; H. How did the case get to that court; I. What does this case mean in terms of a change in the law.
Norino Properties, LLC, et al. v. Joseph J. Balsamo, No. 1343, September Term, 2020, Opinion by Graeff, J. MARYLAND CONSTITUTIONAL LAW — IN BANC REVIEW — SCOPE OF REVIEW Pursuant to Article IV, § 22 of the Maryland Constitution, in banc review by a circuit court panel is permitted “[w]here any trial is conducted by less than three Circuit Judges.” The plain language of Article IV, § 22 provides that in banc review is available only after a trial. A “trial” for purposes of Article IV, § 22 is “‘that step in an action by which issues or questions of fact are decided.’” Berg v. Berg, 228 Md. App. 266, 281 (2016) (quoting Miller v. Tobin, 18 F. 609, 616 (C.C.D. Or. 1883), overruled on other grounds by Alley v. Nott, 111 U.S. 472 (1884)). The term “trial” in the context of in banc review should be read broadly to include an action that determines issues (of law or fact) or questions of fact, as long as the action results in a final judgment. The ruling of the circuit court granting a motion to dismiss with prejudice, thereby resolving the action between the parties, was a “trial” pursuant to Article IV, § 22. Accordingly, the in banc panel had jurisdiction to review the decision of the circuit court dismissing Mr. Balsamo’s complaint. The in banc panel properly found that the circuit court abused its discretion in denying Mr. Balsamo leave to amend the complaint. Circuit Court for Baltimore County Case No. C-03-CV-19-002722 REPORTED IN THE COURT OF SPECIAL APPEALS OF MARYLAND No. 1343 September Term, 2020 ______________________________________ NORINO PROPERTIES, LLC, ET AL. v. JOSEPH J. BALSAMO ______________________________________ Graeff, Reed, Ripken, JJ. ______________________________________ Opinion by Graeff, J. ______________________________________ Filed: December 15, 2021 Pursuant to Maryland Uniform Electronic Legal Materials Act (§§ 10-1601 et seq. of the State Government Article) this document is authentic. Suzanne C. Johnson, Clerk 2021-12-15 10:30-05:00 This appeal involves an ongoing business dispute between appellants, John Zorzit and Norino Properties, LLC (“Norino Properties”),1 and appellee, Joseph Balsamo. Mr. Zorzit and Mr. Balsamo are co-owners of Balsamo and Norino Properties, LLC (“BNP”), a real estate investment company created in 1998. In 2012, Mr. Balsamo filed suit in the Circuit Court for Baltimore County seeking, among other things, to dissolve BNP. The court did not dissolve BNP, but it granted some relief to Mr. Balsamo. Mr. Balsamo appealed, and we affirmed the circuit court’s judgment. See Balsamo v. Zorzit, No. 761, Sept. Term, 2017 (filed July 9, 2018), cert. denied, 461 Md. 487 (2018) (“Balsamo I”). In 2019, Mr. Balsamo, individually and derivatively on behalf of BNP, filed in the Circuit Court for Baltimore County a Complaint, and a First Amended Complaint, against appellants seeking, among other things, a judicial dissolution of BNP. Appellants filed a Joint Motion to Dismiss, arguing that the claims were barred by the doctrine of res judicata, and the Amended Complaint failed to state a claim upon which relief could be granted. The court granted the motion to dismiss. It subsequently denied Mr. Balsamo’s Motion to Alter or Amend Judgment and his accompanying request for leave to amend the complaint. Mr. Balsamo requested in banc review, and the circuit administrative judge designated three judges to review the court’s decision as a panel in banc. The in banc panel reversed the court’s denial of the request for leave to amend and granted Mr. Balsamo 30 days to file another complaint. 1 Mr. Zorzit is the majority owner of Norino Properties, LLC. 2 On appeal, appellants present the following questions for this Court’s review, which we have rephrased slightly, as follows: 1. Did the in banc panel lack jurisdiction to consider the appeal pursuant to Article IV, § 22 of the Maryland Constitution because the circuit court’s dismissal of the Amended Complaint for failure to state a claim was not a “trial”? 2. Did the in banc panel err in concluding that it was an abuse of discretion for the circuit court to refuse to grant Mr. Balsamo leave to amend his complaint? For the reasons set forth below, we shall affirm the judgment of the in banc panel. FACTUAL AND PROCEDURAL BACKGROUND2 I. Events Prior to the Litigation Subject to Appeal BNP, a limited liability company, was formed on November 18, 1998. Mr. Balsamo and Mr. Zorzit each have a 50% membership interest in BNP. Although they did not have a “comprehensive written operating agreement” for BNP, they established BNP “for the purpose of buying, selling, leasing, improving and otherwise investing in real estate to create and preserve assets to fund each member’s retirement.” Mr. Zorzit is BNP’s managing member. Norino Properties is a limited liability company that was formed on September 15, 1997. Mr. Zorzit is the majority owner and “manager or managing member” of Norino 2 Because the present case was resolved on a motion to dismiss, the facts are taken from the Amended Complaint and undisputed documents attached to the Complaint. See Sprenger v. Pub. Serv. Comm’n of Md., 400 Md. 1, 21 (2007). 3 Properties. James Parks, a certified public accountant, is Norino Properties’ minority member. Mr. Balsamo does not have a membership interest in Norino Properties. On November 18, 1998, Norino Properties and BNP entered into an Agreement for Management Services (“Management Agreement”), which provided that Norino Properties would “provide construction, maintenance and supporting services to BNP in exchange for largely unspecified compensation paid by BNP to Norino Properties.” The Management Agreement “does not include any specific rates for compensation and is of indefinite duration.” On November 1, 2010, Mr. Balsamo and Mr. Zorzit affirmed the Management Agreement through an Affirmation.3 In 2012, Mr. Balsamo, individually and derivatively on behalf of BNP, filed suit against appellants, asserting multiple claims, including negligence and breach of fiduciary duties, breach of contract, unjust enrichment, and indemnification. Mr. Balsamo alleged that Mr. Zorzit wasted his and BNP’s assets, stating that Mr. Zorzit “caused BNP to loan him or companies he controlled over $900,000 to purchase property in Canada,” which Mr. Zorzit subsequently mismanaged, “without a promissory note in place to evidence the loan or any writing memorializing his obligations to BNP.” Mr. Balsamo alleged that Mr. Zorzit harmed BNP “by using its funds to satisfy a tax lien imposed upon Nick’s Amusement, another company of which Mr. Zorzit is the sole owner.” 3 Copies of the Management Agreement and the Affirmation are attached to the Amended Complaint, collectively, as Exhibit 2, and incorporated into the complaint by reference. 4 Mr. Balsamo also alleged that, although BNP owned commercial real property in Baltimore County (the “Baltimore County Property”), Mr. Zorzit “wrongfully held that property in the name of Norino Properties.” Chick-fil-A leased the Baltimore County Property, which was valued at $3.5 million. Mr. Balsamo further alleged that Mr. Zorzit assisted Mr. Parks in, among other things, falsely claiming a membership interest in BNP. Mr. Balsamo sought damages, a judicial dissolution and winding up of BNP, and a declaratory judgment “that the Baltimore County Property was owned by and for the benefit of BNP; that Mr. Parks had no interest in BNP; and that BNP’s agreements with Mr. Zorzit’s companies,” including the Management Agreement with Norino Properties, “were not binding or enforceable upon BNP.” In June 2014, a fifteen-day bench trial ensued. On March 4, 2015, the court issued an Order, with Findings of Fact and Conclusions of Law.4 The court did not dissolve BNP, noting that the parties had agreed in the beginning that Mr. Zorzit was the sole authorized representative to conduct business for BNP. Although there had been disputes between the parties in recent years, the court found that it was “reasonably practicable to carry on the business in conformity with the articles of organization.”5 The court did, however, grant 4 A copy of the court’s Findings of Fact and Conclusions of Law from Balsamo I is attached to the Amended Complaint as Exhibit 3, and incorporated into the Complaint by reference. 5 Md. Code Ann., Corps. & Ass’ns Article § 4A-903 (2014 Repl. Vol.), provides that, on application of a member, a circuit court “may decree the dissolution of the limited liability company whenever it is not reasonably practicable to carry on the business in conformity with the articles of organization or the operating agreement.” 5 some relief to Mr. Balsamo, including ordering an independent accounting of BNP member capital accounts. II. Amended Complaint at Issue in the Present Case In August 2019, Mr. Balsamo filed a new Complaint, and in September 2019, he filed an Amended Complaint, against Norino Properties and Mr. Zorzit. In Count One, Mr. Balsamo, in his individual capacity, requested dissolution of BNP because it was “not reasonably practicable to carry on the business in conformity with the articles of organization or the operating agreement.” In Counts Two and Three, he alleged breach of contract and constructive fraud. In Counts Four through Seven, Mr. Balsamo alleged, “for the use and benefit of BNP,” negligence and breach of fiduciary duties, unjust enrichment, constructive fraud, and corporate waste. In Count Eight, for the use and benefit of BNP, he sought a declaratory judgment that the Management Agreement was terminable at any time