Articles Posted in North Carolina Supreme Court

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In this case concerning borrowers’ invocation of North Carolina’s anti-deficiency statute, the Supreme Court held that Defendants failed to forecast substantial competent evidence sufficient to create a genuine issue of material fact regarding the “true value” of the foreclosed property at issue under N.C. Gen. Stat.45-21.36. Defendants asserted the protection of the anti-deficiency statute after a Bank foreclosed the property by nonjudicial power of sale under a deed of trust, purchased the property, and then filed this action to collect the deficiency. The trial court granted summary judgment for the Bank. The Court of Appeals reversed. The Supreme Court reinstated the trial court’s grant of summary judgment, ruling that merely reciting the statutory language or asserting an unsubstantiated opinion regarding a foreclosed property’s value is insufficient under N.C. R. Civ. P. 56. View "United Community Bank (Georgia) v. Wolfe" on Justia Law

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Duke Energy Carolinas, LLC (Duke) owned an easement in Huntersville, North Carolina allowing construction of and access to its power lines. A portion of Herbert Gray’s property encroached on Duke’s right-of-way. Duke asked Gray to remove the encroachment. When Gray did not reply, Duke filed suit seeking injunctive and other relief. The trial court concluded that the six-year statute of limitations for an injury to an incorporeal hereditament set out in N.C. Gen. Stat. 1-50(a)(3) had run and that, consequently, Duke had no legal remedy. The court of appeal affirmed. The Supreme Court reversed, holding (1) removal of the encroachment is a recovery of real property lying outside the scope of section 1-50(a)(3); and (2) therefore, this action fell within the twenty-year statute of limitations set out in N.C. Gen. Stat. 1-40. Remanded. View "Duke Energy Carolinas, LLC v. Gray" on Justia Law

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Plaintiffs were individual investors in undeveloped real estate that purchased real property shortly before the collapse of the real estate market. In 2010, Plaintiffs commenced this action seeking to recover against a bank and its appraisers for their alleged participation in a scheme to defraud investors by artificially inflating property values. Specifically, Plaintiffs alleged that they would not have purchased the real property but for faulty appraisal information and that the bank should have disclosed the inflating appraised property values to them. The trial court granted Defendants’ motion to dismiss on the basis that Plaintiffs did not receive the appraisals at the time of their decisions to purchase. The Supreme Court affirmed, holding that because it was undisputed that Plaintiffs decided to purchase the investment properties without consulting an appraisal and obligated themselves to purchase the properties independent of the loan process, Defendants were entitled to dismissal of all claims. View "Arnesen v. Rivers Edge Golf Club & Plantation, Inc." on Justia Law

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Landowner sought to develop a townhouse community on residential property and obtained a zoning permit to develop the townhouses. Petitioner appealed the Zoning Officer’s formal determination to the Warren County Board of Adjustment. The Board overturned the Zoning Officer’s decision and revoked the zoning permit issued to Landowner. Landowner and Warren County subsequently entered into a consent order agreeing that the zoning permit would be reinstated. A Zoning Officer then issued a determination that the subject property was not restricted by Warren County Zoning Ordinances. Petitioner appealed the Zoning Officer’s determination. The Zoning Officer, however, did not place Petitioner’s appeal on the Board’s agenda. Petitioner filed a petition for writ of mandamus in superior court, requesting that the court compel Respondents to place his appeal on the Board’s next available agenda for a hearing. The court granted the petition. The Court of Appeals affirmed, concluding that the Zoning Officer had a mandatory statutory duty to transmit Petitioner’s appeal to the Board and the Petitioner had a right to have its appeal placed on the Board’s agenda. The Supreme Court affirmed, holding that a zoning officer may not refuse to transmit an appeal from his own zoning determining to the county board of adjustment for its review. View "Morningstar Marinas/Eaton Ferry, LLC v. Warren County" on Justia Law

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Borrowers applied from a home mortgage loan from Lender. During the transaction, a loan officer made an incorrect statement about lien priority. Borrowers later filed breach of fiduciary and negligent misrepresentation claims against Lender, alleging that the junior status of Lender’s lien decreased the marketability and value of their home and exposed them to increased liability. The trial court granted Lender’s motion for summary judgment on all claims. The Court of Appeals concluded that material issues of fact barred summary judgment on Borrowers’ breach of fiduciary duty claim, reasoning that Lender’s assurance of a first priority lien on Borrowers’ new mortgage loan was an act beyond the scope of a normal debtor-creditor relationship. The Supreme Court reversed, holding that the trial court correctly granted summary judgment for Lender on both claims where no fiduciary duty existed and where Plaintiffs did not forecast evidence that they made a reasonable inquiry into the validity of the loan officer’s statements. View "Dallaire v. Bank of Am., N.A." on Justia Law

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By 2013, the North Carolina Department of Transportation (NCDOT) had purchased several hundred properties for the construction of a highway project known as the Northern Beltway. In 2010, Plaintiffs filed a complaint and declaratory judgment against NCDOT, asserting claims for, inter alia, inverse condemnation. Plaintiffs also sought class certification for themselves and all others similarly situated whose property NCDOT was “obliged to purchase.” The proposed class included over 800 property owners within the Northern Beltway. The trial court denied NCDOT’s motion to dismiss Plaintiffs’ claim of inverse condemnation but denied class certification. The court of appeals affirmed. The Supreme Court affirmed in part, vacated in part, and reversed in part the opinion of the court of appeals, holding (1) the courts below erred in analyzing the substantive merits of Plaintiffs’ inverse condemnation claim at the class certification stage; and (2) the court of appeals correctly concluded that the trial court did not abuse its discretion in denying Plaintiffs’ motion for class certification because the unique nature of property, coupled with the large number of diverse tracts involved in this litigation, would make individual issues predominate over common issues of law and fact in a trial on the merits. View "Beroth Oil Co. v. N.C. Dep't of Transp." on Justia Law

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Plaintiffs were the parents of Defendant's former husband, Tyson. Defendant and Tyson began living on a twenty-three-acre parcel of land owned by Plaintiffs in 1984. Defendant and Tyson made several improvements to eight acres of the property, including building a bridge and adding heat and running water to the house. Tyson moved away from the property in 2001. When Tyson began divorce proceedings in 2008, Plaintiffs demanded that Defendant vacate the property. Defendant refused to do so. In 2010, Plaintiffs successfully filed a complaint for summary ejectment against Defendant. Defendant appealed and counterclaimed to quiet title by way of adverse possession. After a jury trial, the trial court found in favor of Plaintiffs. The court of appeals affirmed. Defendant appealed, arguing that the trial court erred in not instructing the jury that Defendant only possessed a portion of the twenty-three acre parcel. The Supreme Court affirmed, holding that because Defendant did not state in her pleading that she possessed just a portion of the disputed partial or present evidence implying that she sought adverse possession of anything less than the twenty-three acres, Defendant was not entitled to an instruction on adverse possession of a portion of the property. View "Minor v. Minor" on Justia Law

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Plaintiff sold a parcel of land adjacent to a golf club to New South Properties (New South) for development as a residential community. New South hired Hunter Construction Group (Hunter) to prepare the parcel for construction. Hunter built erosion control structures and devices, including a silt collection basin. However, a dam Hunter constructed to form the silt collection basin ruptured, causing mud, water, and debris to flood the golf course. As a result of the damage to the golf course, Plaintiffs filed an action against New South, Apple Creek and Hunter, alleging negligence, nuisance, trespass, and violations of the Sedimentation Pollution Control Act (SPCA). The trial court granted summary judgment to Defendants on the SPCA claim. Plaintiffs appealed and withdrew their appeal against all defendants except Hunter. The court of appeals affirmed. Without considering the merits of Plaintiffs' appeal, the Supreme Court affirmed as modified, holding that because Hunter was never cited for a violation for section 113A-66 of the SPCA, Plaintiffs did not have standing to bring a civil action against Hunter pursuant to section 113A-66. View "Applewood Props., LLC v. New S. Props., LLC" on Justia Law

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In 2005, Tonya Bass executed an adjustable rate promissory note with Mortgage Lenders Network USA. The Note was then transferred several times: from Mortgage Lenders to Emax Financial Group, from Emax to Residential Funding Corporation, and from Residential Funding to U.S. Bank. The Note evidenced these transfers by three stamped imprints. In 2009, U.S. Bank filed this foreclosure action after Bass failed to make timely payments. The trial court dismissed the foreclosure action, concluding that because the Note was not properly indorsed and conveyed to Emax or Residential Funding, U.S. Bank was not the rightful holder of the Note. The court based its ruling that the first stamp was "unsigned" and failed to establish negotiation from Mortgage Lenders to Emax. The Supreme Court reversed, holding (1) the indorsements on the Note unambiguously indicated the intent to transfer the Note from each preceding lender and finally to U.S. Bank; and (2) therefore, U.S. Bank was the holder of the Note and had the authority to bring this foreclosure action against Bass. View "In re Foreclosure of Bass" on Justia Law

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A property owner sought a driveway permit from the State Department of Transportation (DOT) to connect its proposed subdivision's system of roads to a state road by which the property was accessed. Two railroad companies opposed the permit, claiming that the rail traffic at a nearby crossing, located approximately one-quarter of a mile away from the proposed driveway connection, might pose a safety hazard to future residents. Consequently, a DOT engineer denied the permit. On appeal, a DOT division engineer granted the permit request subject to the conditions that the owner make improvements to the railroad crossing and obtain the owning and operating railroads' consent to the improvements. On judicial review, the trial court ruled in favor of DOT, finding the agency acted within the scope of its powers in issuing the driveway permit subject to these conditions. The court of appeals affirmed. The Supreme Court reversed, holding that the conditions imposed by DOT in this case were not statutorily authorized, and therefore, DOT exceeded its authority when it issued the conditional permit. View "High Rock Lake Partners, LLC v. Dep't of Transp." on Justia Law