1. Appeal and Error--record--motion to dismiss denied
A motion to dismiss based upon an alleged failure to serve a proposed record on appeal
or to agree with defendant as to the procedure for preparing the record was denied where a
record was submitted with a stipulated agreement as to the settlement of the record.
2. Statute of Limitations--instructions--interest in real property--fiduciary
relationship
The trial court did not err in an action arising from the purchase of property by an
unmarried couple in its instructions on the statute of limitations where defendant contended that
the court erred by instructing that the statute began to run when defendant disavowed plaintiff's
interest in the property, but the statute of limitations does not begin to run until a demand and
refusal where a fiduciary relation exists.
3. Trials--instructions--no objection--finding deemed in accord with judgment
There was no error in an action arising from the purchase of property by an unmarried
couple where defendant contended that the issues found by the jury did not support the judgment
requiring transfer of a half interest in the property from defendant to plaintiff. Defendant did not
object to the instructions before the jury retired and the court is deemed to have made a finding
in accord with the judgment entered.
4. Evidence--fiduciaries--unmarried husband-wife relationship-- admissible
The trial court did not err in an action arising from the purchase of property by an
unmarried couple by admitting evidence of the parties' behavior as husband and wife to rebut
defendant's claims of a mere landlord-tenant relationship. Although plaintiff argued that the
testimony was relevant to demonstrate a fiduciary relationship and the jury determined that the
parties were fiduciaries, that finding was limited to the facts and circumstances of this case;
merely living together should not generally be enough to give rise to a fiduciary relationship.
5. Statute of Frauds--ownership of property--unmarried couple
The trial court erred by denying defendant's motion for a directed verdict based upon the
statute of frauds in an action arising from the purchase of property by an unmarried couple. The
only possible contract that could have existed involved the sale or conveyance of land or an
interest in or concerning land, defendant properly pled the statute of frauds, and this oral
contract cannot be specifically enforced against him.
6. Trusts--purchase money resulting--summary judgment
The trial court erred by granting defendant's motion for summary judgment on plaintiff's
claim for a purchase money resulting trust arising from the purchase of land by plaintiff and
defendant as an unmarried couple. If the facts alleged by plaintiff are true, a finder of fact could
reasonably determine that plaintiff and defendant had an agreement to purchase the property
together and that plaintiff was entitled to some share of the property. The statute of frauds doesnot apply to resulting trusts.
7. Trusts--constructive--no presumption of confidential relationship
In an action remanded on other grounds, the parties were not entitled upon the evidence
presented to a presumption of a confidential relationship, as is usually involved in a constructive
trust, but an instruction on constructive trusts might be appropriate on remand if plaintiff can
provide evidence of a confidential relationship and fraud.
8. Unjust Enrichment--purchase of land by unmarried couple
A cross-assignment of error raising the issue of unjust enrichment in an action arising
from the purchase of land by an unmarried couple was overruled where the jury did not reach
that issue due to its answers on earlier issues. The issue should not arise on remand since both
resulting and constructive trusts may be imposed to prevent unjust enrichment.
Appeal by plaintiff from order granting partial summary
judgment filed 18 November 1996 by Judge Charles C. Lamm, Jr., in
Mecklenburg County Superior Court. Appeal by defendant from
judgment filed 5 December 1996 by Judge Marcus L. Johnson in
Mecklenburg County Superior Court. Heard in the Court of Appeals
21 September 1998.
Casstevens, Hanner, Gunter & Conrad, P.A., by Robert P.
Hanner, II, and Mark D.N. Riopel, for plaintiff.
Law Offices of Raymond Mason Taylor, by Raymond M. Taylor
and Amanda Spence, for defendant.
LEWIS, Judge.
Plaintiff and defendant met in 1962 and began an intimate
relationship in 1963, although plaintiff was married to another
man until 1969. In 1975, defendant moved into plaintiff's mobile
home with her, and in the spring of 1976 the couple moved into a
house on 4.4 acres of land on Arrowood Road in Charlotte ("the
Arrowood property"). It is the ownership of this property that
lies at the center of the parties' present dispute.
Defendant purchased the Arrowood property on 12 December1975 by making a down payment of $8,781.09 from his own funds and
signing a promissory note and deed of trust obligating himself to
pay a total of an additional $30,747.60 over ten years at $256.23
per month. The deed was made to defendant alone, and plaintiff
did not attend the closing or ask defendant how title to the land
was taken. Plaintiff did, however, contribute $160.00 per month,
and she continued to make payments in that amount even after the
mortgage was satisfied on 2 January 1986. She testified at trial
that her understanding about the purchase of the property was
"[t]hat we would buy the property together and we would live
there as a family with the children. It would be our -- our
home."
In 1987, the word "rent" began appearing in the memo portion
of some of plaintiff's checks. When plaintiff co-signed a
mortgage for her son in 1990, she signed a financial disclosure
form stating that she rented the Arrowood property from
defendant. Defendant completed a portion of that form as
"landlord/creditor," marking this a "rental account" and noting
that plaintiff had paid $160.00 per month in rent since 1975. In
a 1996 deposition, plaintiff explained her decision to complete
the form in this manner by stating, "[T]he title was not in my
name."
Following the death of his parents in early 1985, defendant
began spending an increasing amount of time at his family's farm
in Maxton. In 1990 plaintiff confronted her niece in Maxton
regarding the niece's relationship with defendant, marking the
last time that plaintiff saw defendant. Defendant marriedplaintiff's niece in March of 1995, and plaintiff was asked to
vacate the Arrowood property later that month.
Plaintiff filed suit on 19 April 1995, claiming an interest
in the property and citing four different causes of action that
would entitle her to recover: purchase money resulting trust,
constructive trust, quantum meruit -- quasi contract, and unjust
enrichment. Defendant moved for summary judgment as to each of
these issues, and the trial court granted this motion as to the
first issue only. From the grant of summary judgment as to the
resulting trust claim, plaintiff appeals to this Court. The case
went to trial, where plaintiff's equitable claims appear to have
been transformed into a contract case. In the charge conference,
the trial judge stated that this was "just a contract case" and
told counsel for plaintiff, "To the extent that you're requesting
instructions on constructive trust, I will non-suit you, on that
issue." Defendant's motion for summary judgment on plaintiff's
resulting trust claim already having been granted, there were no
trust issues submitted to the jury. Instead, the following
issues were submitted to and answered by the jury at the close of
all the evidence:
ISSUE 1: Before acquiring the property, did
the Defendant agree, by contract, with the
Plaintiff, that the Plaintiff would be a one-
half owner of the property?
ISSUE 2: At the time C.C. Thomas deeded the
property to the Defendant, did a fiduciary
relationship exist between the Plaintiff and
the Defendant?
ISSUE 3: Did the Plaintiff commence this
action before the expiration of the three-
year statute of limitations?
When the jury answered all three questions affirmatively, the
trial court made conclusions of law granting plaintiff a one-half
undivided interest in the Arrowood property. From that judgment,
defendant appeals.
[1]Defendant filed a motion to dismiss plaintiff's appeal
on 6 April 1998, and the matter has been referred to this panel.
Defendant asserts that plaintiff "did not serve a proposed Record
on Appeal, attempt to agree with Defendant as to the procedure
for preparing the record on appeal, or file a motion to extend
her time to do so within the 35 days mandated by Rule 11 . . . ."
Rule 11(d) of the North Carolina Rules of Appellate Procedure
requires that there "be but one record on appeal," and the record
submitted in this action contains a stipulated agreement as to
the settlement of the record on appeal. We are able to address
the appeals of both parties from the record as filed 23 December
1997. Therefore, defendant's motion to dismiss plaintiff's
appeal is denied.
B. Sufficiency of facts to support the verdict
[3]Defendant's second argument as appellant is that the
three issues found by the jury do not support a judgment
requiring defendant to transfer a one-half interest in the
Arrowood property to plaintiff. Defendant contends in his brief,
"The jury did not find that Defendant breached the contract, nor
did it find that Plaintiff upheld her end of the bargain.
Without such findings, the verdict is meaningless." The jury was
not asked to determine these factual issues, and defendant does
not explain why he did not request their submission to the jury.
If, in submitting the issues to the jury, the
judge omits any issue of fact raised by the
pleadings or by the evidence, each party
waives his right to a trial by jury of the
issue so omitted unless before the jury
retires he demands its submission to the
jury. As to an issue omitted without such
demand the judge may make a finding; or, if
he fails to do so, he shall be deemed to have
made a finding in accord with the judgment
entered.
N.C. Gen. Stat. § 1A-1, Rule 49(c) (1990). Defendant did notformally object to the instructions as given before the jury
retired. As such, the trial court is "deemed to have made a
finding in accord with the judgment entered." Id.
C. "Husband-Wife" Relationship
[4]Defendant's third argument as appellant is that the
trial court erred in admitting evidence that suggested the
parties had a "husband and wife" relationship. Defendant made a
motion in limine to suppress evidence of the "husband-wife"
relationship or any evidence of a common law marriage, arguing
that it was irrelevant to proving or disproving the existence of
a contract between the parties on 12 December 1975 and that it
was unfairly prejudicial to defendant. The trial court ruled
that evidence of a lawful, common law marriage would be
inadmissible, but permitted the introduction of "testimony,
descriptive in nature, that it was as husband and wife, but not
as legal husband and wife." The court went on to note that "just
using the term [']living together as husband and wife['] does not
necessarily connote that we are alleging that we are legal
husband and wife."
Plaintiff's brother and a friend each testified at trial on
the appearance of this relationship as one of husband and wife,
but defendant entered no objection at the time. After plaintiff
herself testified that during the six months she and defendant
lived in the mobile home, they "lived as husband and wife,"
counsel for defendant then requested and was granted "a
continuing objection for the record concerning husband and wife." Testimony was later admitted concerning the existence of a
"husband and wife" relationship during the years the parties
lived together on the Arrowood property.
Plaintiff argues that this evidence was relevant not only to
impeach defendant's deposition testimony that the relationship
was merely one of landlord and tenant, but to demonstrate the
existence of a fiduciary relationship. We are extremely
reluctant to recognize a fiduciary relationship between unmarried
roommates, but we are also cognizant of courts' longstanding
reluctance to define a fiduciary relationship.
The courts generally have declined to define
the term "fiduciary relation" and thereby
exclude from this broad term any relation
that may exist between two or more persons
with respect to the rights of persons or
property of either. In this, the courts
have acted upon the same principle and for
the same reason as that assigned for
declining to define the term "fraud." The
relation may exist under a variety of
circumstances; it exists in all cases where
there has been a special confidence reposed
in one who in equity and good conscience is
bound to act in good faith and with due
regard to the interests of the one reposing
confidence . . . . "[I]t extends to any
possible case in which a fiduciary relation
exists in fact, and in which there is
confidence reposed on one side, and resulting
domination and influence on the other."
Tin Originals, Inc. v. Colonial Tin Works, Inc., 98 N.C. App.
663, 666, 391 S.E.2d 831, 833 (1990) (quoting Abbitt v. Gregory,
201 N.C. 577, 598, 160 S.E. 896, 906 (1931) (citations omitted)).
Because the existence of a fiduciary relationship is a question
of fact, Crew, 236 N.C. at 530, 73 S.E.2d at 311, and because
there is no argument supporting the assignment of error that the
trial court's actual instructions to the jury on the definitionof a fiduciary were incorrect, we are bound by the jury's
determination that under these facts and circumstances the
parties were fiduciaries. These findings should be limited to
the facts and circumstances of this case and we emphasize that
merely living together should not, generally, be enough to give
rise to a fiduciary relationship. The descriptive evidence of
the parties' behavior as husband and wife was relevant here to
rebut defendant's claims of a mere landlord-tenant relationship,
and defendant's assignments of error on this point are overruled.
D. Statute of Frauds
[5]Defendant's final argument as appellant is that the
trial court erred in denying his motion for a directed verdict
because plaintiff's claim of an oral contract is barred by the
statute of frauds. According to our statutes,
All contracts to sell or convey any
lands, . . . or any interest in or concerning
them, . . . shall be void unless said
contract, or some memorandum or note thereof,
be put in writing and signed by the party to
be charged therewith, or by some other person
by him thereto lawfully authorized.
N. C. Gen. Stat. § 22-2 (1986). Plaintiff claims that a contract
concerning the ownership of land is not automatically governed by
the statute of frauds, citing only Potter v. Homestead
Preservation Assn., 330 N.C. 569, 412 S.E.2d 1 (1992). Plaintiff
notes that Potter made a distinction to the rule regarding "a
parol partnership agreement or joint enterprise entered into by
two or more persons for the express purpose of carrying on the
business of purchasing and selling real estate, or intereststherein, for speculation, the profits to be divided among the
parties . . . ." Id. at 577, 412 S.E.2d at 6. The relationship
between plaintiff and defendant may have been many things, but
the evidence does not indicate that it was a partnership of real
estate speculators.
Plaintiff argues in her brief as appellee that, prior to the
actual transfer, she contracted to be a joint owner of the
disputed property but that "[t]his agreement did not specify that
the land would be partially conveyed to her by deed when the
house is paid off." This is a different story than was proposed
in her complaint, which alleged, among other things:
36) At the time Plaintiff was providing
funds to Defendant for the purchase of her
one-half interest in the [Arrowood property],
Plaintiff expected to receive payment in the
form of the conveyance of a one-half interest
in the aforesaid real property to Plaintiff.
37) Plaintiff's expectation of the aforesaid
payment is reasonable.
38) Defendant received Plaintiff's service
in the form of funds to help purchase the
subject real property with the knowledge or a
reason to know that Plaintiff expected to be
paid in kind with the conveyance of a one-
half interest in the [Arrowood property].
(emphasis added). According to our Supreme Court,
Since the contract upon which the plaintiff's
alleged cause of action is bottomed rests
solely in parol, and since the said contract
is one to sell and convey lands and no
memorandum thereof has been put in writing
and signed by the party charged therewith, or
by any person by him thereto lawfully
authorized, it cannot, under the statute, be
enforced.
Chason v. Marley, 224 N.C. 844, 845, 32 S.E.2d 652, 653 (1945).
Plaintiff now argues that the trial court, viewing theevidence in the light most favorable to the plaintiff upon
defendant's motion for directed verdict, determined "that the
contract was not one concerning the conveyance or transfer of
land, but rather that the property taken by Defendant-Appellant
[was] for both of them." Citing no authority, plaintiff
concludes, "Therefore the Statute of Frauds is inapplicable." We
disagree.
The only possible contract that could have existed was one
involving the sale or conveyance of land or an interest in or
concerning land; the subject matter of the alleged contract was
nothing if it was not the agreement to buy the Arrowood property.
Defendant properly pled the statute of frauds in his motion for a
directed verdict, and as such this oral contract cannot be
specifically enforced against him. See, e.g., Pickelsimer v.
Pickelsimer, 257 N.C. 696, 698, 127 S.E.2d 557, 560 (1962). The
trial court committed reversible error in denying defendant's
motion for a directed verdict on this point, and the judgment
awarding plaintiff a one-half interest in the Arrowood property
on a contract theory is reversed. As will be set out below,
though, plaintiff is not without remedies on remand.
B. Constructive Trust
[7]As appellee, plaintiff addresses in a cross-assignment
of error the trial court's failure to present the issue of
constructive trust to the jury. Unlike a resulting trust, a
constructive trust "arises when one obtains the legal title toproperty in violation of a duty he owes to another. Constructive
trusts ordinarily arise from actual or presumptive fraud and
usually involve the breach of a confidential relationship." Fulp
v. Fulp, 264 N.C. 20, 22, 140 S.E.2d 708, 711 (1965). Plaintiff
herself notes that the parties are entitled to no presumption of
a confidential relationship upon the evidence presented. If,
however, plaintiff can provide evidence of a confidential
relationship and fraud, a jury instruction on remand regarding
constructive trusts might be appropriate.
C. Unjust Enrichment / Quantum Meruit
[8]Finally, plaintiff raises the issue of unjust enrichment
in her only remaining cross-assignment of error argued in her
brief as appellee. Plaintiff notes that "[t]he trial court
presented the issue of restitution to the jury in issues 4 and 5"
and that "[t]he instructions the judge gave the jury regarding
restitution are similar to those needed to make a finding of
unjust enrichment or quantum meruit . . . ." The jury did not
reach these issues because it was not required to after answering
in the affirmative to the first three issues proposed; as such,
plaintiff was not prejudiced on this point at trial. Plaintiff's
cross-assignment of error on this point is overruled. At the new
trial, this issue should not arise since both resulting and
constructive trusts may be imposed to prevent unjust enrichment.
In summary, the result reached by the trial court awarding
plaintiff a one-half share in the Arrowood property may have beencorrect and may be the result reached at a new trial. It cannot
now stand on the contract theory on which it was based because
the alleged contract violates the statute of frauds. Plaintiff
brought her case on equitable theories and, having no remedies at
law, it should be tried on those theories where appropriate. As
such, we reverse and remand for a new trial consistent with this
opinion.
Reversed and remanded.
Chief Judge EAGLES and Judge HUNTER concur.
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