LEVINE, J., delivered the opinion of the Court.
This case arises from an action for declaratory judgment brought by appellees, Baltimore County (the county) and the Maryland American General Group (Maryland General). After the Circuit Court for Harford County (Dyer, J.) ruled in their favor against appellants, Ira C. Rigger and Elizabeth R. Rigger (the Riggers), this appeal resulted.
The dispute centers on a lease entered into by the Riggers and the county on November 10, 1960. Under that agreement, the Riggers were to construct a one-story building on York Road in Cockeysville for use as a public library for a term of ten years. Contained in the lease were the following provisions:
In 1964, the General Assembly of Maryland enacted Chapter 124 which added a new § 40 to Maryland Code (1957) Art. 53.
On November 17, 1965, one Margaret M. Mayer sustained personal injuries when she fell upon a walkway outside the library. Alleging that her injuries were due to the defective
Although the events which transpired in that case are not entirely clear, principally because the court papers in that litigation were not included in the record of this case, this much is apparent. At the time of the injury, there was in effect a policy of public liability insurance which Maryland General had issued to the county. The Riggers insisted that Maryland General, in addition to being required to provide a defense on behalf of the county, was also obliged to satisfy any judgment obtained by the Mayers against the Riggers by virtue of paragraph 6 of the lease — the indemnification or exculpatory clause. The dispute was temporarily solved by a "Non-Waiver Agreement" executed by the Riggers on August 14, 1967. Pursuant to that agreement, counsel employed and paid by Maryland General entered his appearance for the Riggers.
On December 23, 1968, the Mayer case was settled at the "trial table" for the sum of $10,000, which was paid by Maryland General with the approval of the Riggers' attorney. It appears that the Mayer settlement was handled in that fashion with a view towards a further judicial determination of who should bear ultimate responsibility — as between the parties to the lease — for the payment of the $10,000. With that purpose in mind, appellees filed this suit. In the judgment from which this appeal is taken, Judge Dyer declared that appellees are "entitled to recover from the [Riggers] the sum paid by [them] in settlement" of the Mayer claim.
Although appellants urge upon us several grounds for reversal, we deem it necessary to consider only their contention that the statute — having been enacted in 1964 — cannot be retrospectively applied to the lease which was executed in 1960. Hence, appellants say, the trial judge erred in holding that the statute operates so as to preclude them
It is well established that retrospective operation of a statute is not favored, State Farm v. Hearn, Adm'x, 242 Md. 575, 219 A.2d 820 (1966); Bell v. State, 236 Md. 356, 204 A.2d 54 (1964); Gutman v. Safe Deposit & Trust Co., 198 Md. 39, 81 A.2d 207 (1951); 2 Sutherland, Statutory Construction, § 2201 (3rd ed. 1943); and there is a general presumption that all statutes, state and federal, are intended to operate prospectively.
No prior decision of this Court appears to have considered the question presented here under similar or analogous factual circumstances. There are cases decided elsewhere, however, that have dealt with the issue on virtually identical facts, and they are supportive of appellants' contention, Weiler v. Dry Dock Sav. Inst., 258 App. Div. 581, 17 N.Y.S.2d 192, aff'd mem., 284 N.Y. 630, 29 N.E.2d 938 (1940); Bernard Katz, Inc. v. East Thirtieth Street Corp., 172 Misc. 873, 16 N.Y.S.2d 640 (1939), aff'd mem., 259 App. Div. 707, 19 N.Y.S.2d 145 (1940). Cf. Whitmire v. H.K. Ferguson Co., 261 Cal.App.2d 594, 68 Cal.Rptr. 78 (1968); Booth v. Cebula, 25 Ill.App.2d 411,
In Weiler v. Dry Dock Sav. Inst., supra, a lease containing an exculpatory clause was entered into on March 23, 1937. On June 5 of that year, a New York statute, declaring such provisions "to be void as against public policy and wholly unenforceable," became effective. On July 27, 1937 — fifty-two days later — the tenant sustained property damage because of the owner's negligence. The New York court noted the absence of any language in the statute indicating a legislative intent to embrace leases executed prior to the effective date of the statute; and thus expressly held that the latter applied "only to contracts made on that date or thereafter."
Manifestly, § 40 contains no clear expression of an intent to apply it retrospectively, Unsatisfied Fund v. Bowman; State Farm v. Hearn, Adm'x; Bell v. State; Gutman v. Safe Deposit & Trust Co., all supra. As the New York and Illinois cases strongly suggest, a retroactive application of the statute to the lease might well raise serious constitutional questions. Furthermore, Weiler, supra, lays to rest any notion that because the injury was sustained after the effective date of § 40, the latter is being invoked prospectively rather than retrospectively. The determinative event in this context is the execution of the lease, and not the happening of the accident.
It is important to observe that, as in New York and Illinois, prior to the enactment of the statute in Maryland, exculpatory clauses were not deemed contrary to the public policy of this state. We so held, following the great weight of authority, in Eastern Ave. Corp. v. Hughes, 228 Md. 477, 180 A.2d 486 (1962). In view of our holding that § 40 is inapplicable to the lease in this case, that decision is controlling.
In an effort to overcome the possible impact of the exculpatory clause, appellees maintain that the Riggers are, in any event, liable for the Mayer damages in view of their covenant "to be responsible for and bear the expense of repairs or maintenance of... [the] paving and sidewalks"
Whatever might have been the liability of appellants under the covenant to repair and maintain in the absence of the exculpatory clause, appellees' argument plainly overlooks our many prior decisions holding that the intention of the parties must be garnered from the terms of the contract as a whole, and not from the clauses considered separately, Kasten Constr. v. Rod Enterprises, 268 Md. 318, 329, 301 A.2d 12 (1973); Perper v. Fayed, 247 Md. 639, 234 A.2d 144 (1967); Wheaton Lanes v. Rinaldi, 236 Md. 525, 204 A.2d 537 (1964); Sagner v. Glenangus Farms, 234 Md. 156, 198 A.2d 277 (1964). In keeping with that principle, paragraphs 6 and 10 must be read together. The result is that the exculpatory clause limits paragraph 10 so as to merely require the landlords to perform repairs and maintenance to the designated portions of the demised premises; and, in the alternative, it authorizes the tenant to do so at the landlords' expense. Suffice it to say that with the exculpatory clause being fully effectual, the meaning ascribed by appellees to paragraph 10 has no support.
In sum, we conclude that § 40 does not invalidate the exculpatory clause of the lease; therefore appellees are not entitled to recover from appellants the amount paid in settlement of the personal injury claim. An appropriate declaratory judgment to that effect should be entered upon remand.
Reversed and remanded for entry of a declaratory judgment conformable to the views expressed herein; appellees to pay costs.