Category: NC Supreme Court Cases

N.C. S.Ct.: Christenbury Eye Center, P.A. v. Medflow Inc.- Date from which Statute of Limitations Runs

Summary:

In an unfulfilled business agreement, over a period of fourteen (14) years, Medflow, Inc. never made any royalty payments, never provided a written sales reports ,and never obtained consent for restricted sales. When Christenbury Eye Center, P.A. brought suit for such, the trial court dismissed the case as the various claims were stale under the applicable Statutes of Limitations. On appeal, Christenbury argued that the business agreement should be treated as “an installment contract”, with a new limitations period beginning upon the failure to make each payment, allowing recovery on royalty payments due within the three years before the filing of its complaint.… Read More

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N.C. S. Ct.: RL Regi v. Lighthouse Cove- Waiver of Statutory Rights Enforceable

RL Regi v. Lighthouse Cove- Waiver of Statutory Rights EnforceableSummary:

Regions Bank, the predecessor to RL Regi, providing commercial financing for real estate development for Lighthouse Cove, which was guaranteed by the individual business partners and their spouses, including Lionel L. Yow and his wife, defendant Connie S. Yow. After Lighthouse Cove defaulted, Connie Yow, among others, signed a forbearance agreement that included a waiver of claims against the lender. When the loan again went into default RL Regi sued and Connie Yow alleged violations of the Equal Credit Opportunity Act (“ECOA”) as a defense.

The North Carolina Supreme Court held that “the agreement expressly releases the lender from ‘any and all claims, defenses and causes of action.” Reversing the North Carolina Court of Appeals, the opinion continued that while “ a contract which on its face involves illegal conduct will not be enforced”, there was nothing “facially illegal about this loan relationship in which a lender provided a loan upon certain conditions; moreover, parties routinely forego claims in settlement agreements.”

Commentary:

This opinion does recognizes that Connie Yow “acknowledged that she freely and voluntarily entered into the agreement ‘after an adequate opportunity and sufficient period of time to review, analyze, and discuss .… Read More

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N.C. S. Ct.: DocRX v. EMI – Full Faith and Credit Precludes Attack on Foreign Judgment based on Intrinsic Fraud

Summary:

The North Carolina Supreme Court affirmed the earlier opinion from the Court of Appeals that “the defenses preserved under North Carolina’s UEFJA are limited by the Full Faith and Credit Clause to those defenses which are directed to the validity and enforcement of a foreign judgment.”

For a copy of the opinion, please see:

DocRX v. EMI – Full Faith and Credit Precludes Attack on Foreign Judgment based on Intrinsic Fraud

The Court of Appeals opinion and summary can be found here:

http://ncbankruptcyexpert.com/?p=1170 Read More

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N.C. S. Ct.: Dallaire v. Bank of America- No Fiduciary Duty between Borrower and Lender

Summary:

The Dallaire purchased their home in 1998 for $173,660.00. They filed a Chapter 7 bankruptcy in the Middle District of North Carolina, case number 05-53774, on October 13, 2005, and at that time had three mortgages against the property- the first and second mortgages were both held by Bank of America, in the amounts of $138,900 and $25,000, respectively, and a lien for a business loan to BB&T, in the amount of $241,449.37. The Dallaires received a discharge and did not reaffirm any of the three obligations. A year later (at the tail end of the mortgage lending frenzy), the Dallaires refinanced the Bank of America loans, after Bank of America, following the advise of its title agency, mistakenly believed that the BB&T lien had been extinguished.… Read More

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N.C. Supreme Ct.: In re Bass- Stamped Indorsement is Sufficient for Transfer

Summary:

The first indorsement in a chain of transfers of a mortgage note was simply a stamp, without an accompanying signature or initials. After falling behind on mortgage payments, Bass, relying on Econo-Travel Motor Hotel Corp. v. Taylor, 301 N.C. 200 (1980), challenged the standing of U.S. Bank as the holder of the note, arguing that it had not been properly indorsed.

The North Carolina Supreme Court rejected this argument relying on the broad definition of “signature” in the Uniform Commercial Code (UCC), at N.C.G.S. § 25-3-201(b)(37), as “any symbol executed or adopted with present intention to adopt or accept a writing.” As the official comment to the UCC includes that such symbol can be “printed, stamped or written; it may be by initials or by thumbprint”, the term “signature” is not limited to “a long-form writing of an individual person’s name.” Bass at 7.… Read More

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N.C. S.Ct.: In re Johnson- Homeowner Association Assessments must be Uniform and Pro Rata

Summary:

The Starboard Association administers a condominium consisting of 33 separate buildings. Its by-laws authorized assessments against members to pay costs, providing that “ [a]ll assessments levied against the Unit Owners and their Condominium Units shall be uniform” and “shall bear the same ratio to the total assessment made against all Unit Owners and their Condominium Units as the undivided interest in Common Property appurtenant to each Condominium.”

In October 2005, the Association approved renovations to all of the building, except Building 33, assessing the costs against all owners, except owners of Building 33. Subsequently, in November 2007, the Association renovated Building 33, assessing those costs only to the owners of Building 33.… Read More

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N.C. Supreme Court: Willis v. Willis- Mistake of One Party Insufficient to Reform Deed

Summary:

Janice Willis had two sons, Eddie and Anthony. In December 2004 she drafted a will bequeathing “any interest that I may own in my home place” to Eddie, expressing her “wish” that, if she conveyed the property to Eddie before her death and he decided to sell it, Eddie would divide the proceeds with his brother Anthony. The will also bequeathed the residue of her estate to Eddie and Anthony in equal shares, to pass to their children per stirpes if either or both predeceased her. Mrs. Willis did transfer the property to Eddie, subject to a life estate, but Eddie died a few years later, while Mrs.… Read More

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N.C. Supreme Court: Charlotte-Mecklenburg Hospital Authority v. Talford- Standard for Establishing Medical Debts

Summary:

Mr. Talford received medical treatment at the Charlotte-Mecklenburg Hospital (“CMH”), but was unable to pay the asserted $14,419.57 bill. CMH sued presenting as evidence an Affidavit from its Director of Revenue Management (“DRM”)stating that the amounts charged were reasonable because it “was consistent with the amounts charged to all similarly situated patients, was ‘within industry norms for similar facilities providing similar services at similar levels of care’ and was ‘compliant with various published billing and charging regulations and guidelines, including those for Medicare and Medicaid Services.’” Salford, while admitting that services had been provided, contended that these charges were excessive.… Read More

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N.C. Supreme Court: In re Vogler Realty- Review of Attorney’s Fees for Foreclosure Trustee by Clerk of Court not Authorized

Summary:

In foreclosing on a Deed of Trust, the Trustee was paid  costs and expenses consisting of a commission, pursuant to N.C.G.S. § 45-21.15(a),  of 5% of the highest bid and Trustee’s attorneys fees of 15% of the outstanding promissory note on which behalf he was acting.  This resulted in third lien-holder receiving only partial payment and the fourth lien-holder receiving nothing.  The third lien-holder filed a motion with the Clerk of Superior Court arguing that under N.C.G.S. § 32-61,  the Clerk was authorized to determine the reasonableness of a “fiduciary or trustee” fees.  The Clerk agreed, reducing the Trustee’s fees substantially.… Read More

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