If there’s one thing readers of this blog can count on, it is that every even-numbered year ends with a gush of opinions from both appellate courts as the judges and justices strive to finish the year’s work before new members show up on New Year’s Day. 2022 is no exception. The Court of Appeals issued a number of significant opinions on 20 December 2022. Several involve issues of first impression or are otherwise noteworthy. Here are synopses of some of the ones that caught my attention.
Dillree v. Dillree, COA22-423, 2022-NCCOA-835
In this case of first impression, we see a fairy-tale story that ends in sadness. The Dillrees were high school sweethearts. Though each married someone else and had children, the Dillrees reunited later in life. They wed and were happily close for years. However, Ms. Dillree was diagnosed with Alzheimer’s in 2014. Though Mr. Dillree retired early to care for her, by 2017 he also was suffering mental decline and was observed being both negligent and abusive toward Mrs. Dillree. Eventually, he too was diagnosed as suffering from Alzheimer’s.
In 2017, Ms. Dillree’s daughter petitioned the Superior Court to have Ms. Dillree declared incompetent. The trial court allowed the petition and appointed co-plaintiff Emily Tobias to be her guardian. Ms. Tobias had Ms. Dillree transferred to a facility where she could receive care and be kept separate from Mr. Dillree, who unsuccessfully (and rather combatively) sought to be reunited with his wife.
It turned out that the Dillrees had substantial assets, and issues arose regarding Mr. Dillree’s financial support of his wife following their separation. Ms. Dillree’s guardian sued, seeking an interim distribution of the marital property, equitable distribution, and injunctive relief. Mr. Dillree moved to dismiss for lack of subject matter jurisdiction and failure to state a claim. The trial court denied the motion.
The Court of Appeals invoked Rule 2 to address this interlocutory appeal, then addressed the question of the trial court’s jurisdiction. The issue of first impression was whether the actions of Mrs. Dillree’s guardian could cause a legal separation of the married couple. In a detailed analysis, the Court of Appeals panel concluded that a guardian did not have that authority. While a guardian has the discretion to separate incompetent spouses in their best interests and for their safety, the guardian’s does not have the decisional authority to generate a “marital separation.” Consequently, the Dillrees were not legally separated and the trial court lacked subject matter supervision to hear the equitable distribution claim.
Jackie W. Autry, et al. v. Bill Clark Homes, LLE, et al., COA 22-293, 2022-NCCOA-833
Litigators are acutely aware of statutes of limitation, which can block otherwise meritorious cases. Less frequently encountered are statutes of repose, which “serve as an unyielding and absolute barrier that prevents a plaintiff’s right of action even before this cause of action may accrue[.]” Black v. Littlejohn, 312 N.C. 626, 633, 325 S.E.2d 469, 475 (1994). This otherwise unremarkable case demonstrates the effect of that barrier.
Plaintiffs, subdivision homeowners, sued defendants, the subdivision developer. Plaintiffs alleged that defendants’ failure to maintain a drainage pipe that extended beyond the subdivision boundaries led to flooding damage within the subdivision. The trial court allowed defendants’ motion for summary judgment.
The Court of Appeals affirmed, noting that N.C.G.S. § 1-50(a)(5)(a) provides that “[n]o action to recover damages based upon or arising out of the defective or unsafe condition of an improvement to real property shall be brought more than six years from the later of the specific last act or omission of the defendant giving rise to the cause of action or substantial completion of the improvement.” The evidence in this case indicated that defendant devised a plan to deal with potential flooding in 2000 and the materials were installed and the work completed in 2007. Though the statute of repose has exceptions for willful or wanton negligence in the development of real property, no evidence supported application of the exception here. Accordingly, plaintiffs’ claim failed before it even began.
Devore v. Samuel, et al. and Kindercare Education, LLC et al. v. Charlotte-Mecklenburg Board of Education, et al. COA22-305, 2022-NCCOA-834.
A bus operated by Charlotte-Mecklenburg Schools dropped off a student at KinderCare. As the child was crossing the street to the KinderCare facility, he was struck and injured by an SUV driven by defendant Samuel. Plaintiff student sued several defendants, including KinderCare, but did not sue the school bus driver or the Charlotte-Mecklenburg Board of Education, which employed the bus driver. However, KinderCare later filed a third-party complaint against the Charlotte-Mecklenburg Board of Education and the bus driver, alleging contribution and indemnity.
Charlotte-Mecklenburg Board of Education moved to dismiss on the grounds that the third-party claims were barred by governmental immunity. The trial court denied the motion and the school board appealed. The Court of Appeals tackled as an issue of first impression the application of governmental immunity for local school boards in school bus negligence cases.
The Court began its analysis by pointing out that local school boards are covered by governmental immunity and thus not liable for tort or negligence except to the extent that it has waived that immunity. However, a series of statutes has waived the school boards’ governmental immunity and all the parties agreed that, as a result of the resulting statutory waiver, KinderCare’s third-party claims could be asserted in the Industrial Commission under the Tort Claims Act. So the issue presented by this case is whether the statutory waiver of governmental immunity for local school boards is limited to claims raised in the Industrial Commission, or whether that waiver more broadly applies to third-party claims raised in a court of law.
Under current North Carolina statutes and case law, the State and state agencies can be joined as third-party defendants in suits for contribution of indemnification. What about a local school board? Following an extensive analysis, the Court of Appeals concluded that a local school board is not considered to be equivalent to the State Board of Education. While the State has chosen to waive the governmental immunity provided to local school boards, that waiver is limited and required the claim to be brought in the Industrial Commission. N.C.G.S. §143-300.1.
The Court of Appeals also considered plaintiff’s argument that the school board waived its governmental immunity by the purchase of insurance. The school board had purchased an excess liability policy which would apply if the board’s self-insurance of $1,000,000 was exceeded. If the school board was found liable and paid the full amount of its self-insurance, the policy would provide the additional coverage. However, the policy explicitly stated that the school board did not intend to waive its governmental immunity and that the policy applied coverage only for events to which governmental immunity did not apply. Accordingly, the Court of Appeals held that the trial court erred in denying the school board’s motion to dismiss KinderCare’s third-party complaint for contribution and indemnity.
In re Moretz, COA22-172, 2022-NCCOA-840
Many readers of this blog will remember without nostalgia the pre-Dogwood days when violations of the Rules of Appellate Procedure often led to dismissal of an appeal. Dogwood clarified that appellate rule violations fall into three categories: (1) waivers arising at trial; (2) jurisdictional defects; and (3) non-jurisdictional defects. While jurisdictional defects mandate dismissal, only “gross” or “substantial” non-jurisdictional defects justify dismissal. Dogwood Dev. & Mgmt. Co. v. White Oak Transp. Co., 362 N.C. 191, 194, 657 S.E.2d 361, 363 (2008). As a result of Dogwood, the number of dismissals dropped precipitously. Even so, practitioners should be alert to the possibility that mistakes can doom an appeal.
In re Moretz is a case in point. The matter involves appeal of an order foreclosing on the respondent’s home. During the process, respondent-appellant’s attorney fell ill and was hospitalized for a period, but the opinion does not otherwise note any explanation for what went wrong. Suffice it to say that the substitute truste-appellee moved to dismiss the pending appeal, citing eleven violations of the Rules of Appellate Procedure such as failure timely to serve the proposed record on appeal, failure timely to file the record on appeal, failure to include all the documents necessary to the appeal, and failure to comply with the stay and bond provisions of the Rules.
In addressing the motion to dismiss the appeal, the Court of Appeals found in the record numerous errors, including failure to include the order appealed from, failures to include proofs of service of documents, failure to file an appeal information statement, and failure to file a transcript. The Court then determined that these errors were gross and substantial. Concluding that these errors warranted dismissal, the Court of Appeals allowed the substitute trustee’s motion to dismiss.
No appellate practitioner likes to see cases like this. Whatever the merits of the appeal, the client has lost out because the reviewing court was denied the tools it needed to do its job.
State v. Smith, COA22-257, 2022-NCCOA-848
Defendant was convicted of several drug offenses. The evidence at trial indicated that sheriff’s detectives had used two confidential informants to make a controlled buy. One was given cash while the other was outfitted with a watch that also contained a video camera to record the transaction.
When the case went to trial, the informant who had sported the watch was nowhere to be found. Defendant objected to admission of evidence from the Batwatch because it contained statements made by the unavailable confidential informant and because the video and still frames from the video included a time and date stamp. The trial court overruled the objection and allowed the video (but not the audio) from the watch to be played to the jury. Defendant was convicted.
On appeal, defendant again argued that the time and date stamp on the video constituted inadmissible hearsay. The Court of Appeals noted that an investigator testified that the confidential informant merely operated the watch, could not turn it off, and had no control over the watch other than where it was pointed. The investigator further testified that neither the watch nor the recording could be edited. Instead, the watch was plugged directly into a computer and the information downloaded. The testimony indicated that the time and date stamp was added by the computer.
The Court of Appeals noted that no North Carolina case addressed whether computer records generally constitute hearsay. However, it found persuasive the analysis from other states that distinguished between a “computer-generated record” and a “computer-stored record.” The former is a “self-generated record of a computer’s operations resulting from the computer’s programming” that does not contain a statement from a person. These records are not hearsay. On the other hand, “computer-stored records,” which merely store or maintain the statements and assertions of a human, are hearsay.
Addressing this issue of first impression in the context of this case, the Court of Appeals concluded that the time and date stamps were generated by the computer and did not implicate any hearsay concerns. Accordingly, the Court of Appeals found that the trial court did not err.
In Conclusion: These are just some of the cases issued by our appellate courts as 2022 winds down. Not unlike the Supreme Court of the United States, the last batch of cases often contains the most important opinions, so be sure to check them all out. If any of the cases discussed above look interesting to you or appear to apply to your area of practice, be sure to read the entire opinion. The information I’ve provided is as accurate as I can make it in the short space provided but it does not reflect all the nuances of these lengthy opinions.
Finally, a happy 2023 to all our readers!