Summary:
Mr. Pedlow made several loans to Mr. Kornegay in 2006 and 2007, but the parties only sought to reduce those obligations to writing on July 29, 2008, when Mr. Pedlow's attorney emailed Mr. Kornegay a promissory note for $84,000. Mr. Kornegay finally signed the promissory note July 2, 2009, under seal. When made no payments were ever made, Mr. Pedlow then commenced suit for $84,000 on May 30, 2019. Mr. Kornegay raised the Statute of Limitations as a defense and the trial court granted his Motion for Summary Judgment.
While the 6-year Statute of Limitations from N.C.G.S. §25-3-118(b) specifically applies to negotiable instruments payable on demand, when an instrument is executed under seal N.C.G.S. § 25-3-118(h) displaces any other statute of
limitations found in the UCC and then with N.C.G.S. §1-47(2), the Statute of Limitations is 10 years and for a promissory note payable on demand begins to run from the date of the execution of the note. Wells v. Barefoot, 55 N.C. App. 562,
566, 286 S.E.2d 625, 627 (1982). Accordingly, the Statute of Limitations did not begin to run until July 2, 2009, making this action timely.
Commentary:
As the concurrence makes clear, prior to the signing of the promissory note on July 2, 2009, Mr. Pedlow would not have had any cause of action against Mr. Kornegay, both because it would have been subject to a 3-year Statute of Limitations under N.C.G.S. §1-52 and (unmentioned by the concurrence) likely barred by the Statute of Frauds for being unwritten.
For a copy of the opinion, please see:
Blog comments