SUSAN SESSLER, Plaintiff,
v.
LORETTA MCDERMOTT MARSH, Defendant
No. COA00-801
(Filed 17 July 2001)
1. Brokers--expired real estate listing--proximate cause of sale
The trial court did not err in a nonjury trial by concluding
that plaintiff-realtor was the procuring cause of the sale of a
commercial building where plaintiff, as building manager and
leasing agent, had ongoing conversations with an occupant about
purchasing the building dating back to the early 1990s; plaintiff
entered an exclusive right to sell listing contract with defendant
when defendant decided to sell in 1996; the first contract with the
occupant fell through due to unexpected costs for bringing the
building into compliance with building codes; the occupant entered
a second contract to purchase the property, eventually formed
another business incorporated for the purpose of closing on the
property, and assigned its rights under the conract to the
corporation; the corporation closed on the property; plaintiff did
not participate in negotiations for the second contract; and the
purchaser testified that he had no prior contact with defendant or
her family and would not have been negotiating for the purchase of
the building without plaintiff's efforts. The sale was the
proximate result of plaintiff's efforts even though the listing
agreement had expired when the second contract was entered.
2. Brokers--real estate commission--expiration of listing--no
break in continuity of events
A realtor's right to a commission for the sale of a commercial
building was not extinguished by the expiration of her listing
contract where the purchaser testified that plaintiff was the party
who procured him and that he would not have otherwise entered into
negotiations for the purchase of the building. The listing
contract is not rendered perpetual because there was no break in
the continuity of events.
3. Brokers--real estate listing--modification
An alleged modification to a real estate listing between two
contracts was not enforceable because there was no benefit to
plaintiff or detriment to defendant which would constitute
consideration.
4. Brokers--real estate listing--consideration
The trial court did not err by granting summary judgment for
plaintiff-realtor on the defense of lack of consideration for the
listing agreement where the listing contract provided valuable and
legal consideration on its face. Where there is consideration on
the face of the document, the court will not look for the adequacy
of the consideration without fraud and there is no evidence herethat the document was fraudulent as to defendant.
5. Unfair Trade Practices--real estate commission--failure to
pay--second contract
The trial court did not err by granting summary judgment for
defendant on plaintiff's claim for unfair and deceptive practices
arising from two contracts to sell real estate and the failure to
pay a commission. The evidence undisputedly demonstrated that the
inability to close on the first contract and the creation of a new
entity to purchase the property was caused by the purchaser's
difficulty obtaining financing, not by any effort by defendant to
deceive plaintiff.
Appeal by plaintiff and defendant from order entered 24
September 1998 by Catherine C. Eagles and appeal by defendant from
judgment entered 6 March 2000 by Judge W. Douglas Albright in
Guilford County Superior Court. Heard in the Court of Appeals 17
May 2001.
Floyd and Jacobs, L.L.P., by Jack W. Floyd, Robert V. Shaver,
Jr., and James H. Slaughter, for plaintiff.
Adams Kleemeier Hagan Hannah & Fouts, by David A. Senter and
David S. Pokela, for defendant.
MARTIN, Judge.
Plaintiff brought this action to recover a real estate
commission allegedly due her in the amount of $60,000. She alleged
claims for breach of contract, unfair and deceptive practices, and
quantum meruit. In her complaint, plaintiff alleged that she
entered into an exclusive right to sell listing contract (listing
contract) with defendant for the sale of The Commerce Building
property, located at 19 West Hargett Street in Raleigh. The
listing contract provided, in pertinent part:
This EXCLUSIVE RIGHT TO SELL LISTING
CONTRACT (Listing Contract) is entered intothis ___ day of ________, 19___ between
Loretta McDermott Marsh as owner(s) (Owner)
of the property described below (the
Property) and Susan W. Sessler, as Listing
Firm (Agent).
1. In consideration of the Owner
agreeing to list the Property for sale and in
further consideration of Agent's services and
efforts to find a buyer, Agent is hereby
granted the exclusive right to sell the
Property for a period of 4 months from July 15
1996 to and including November 15, 1996 for a
cash price of $1,060,000.00.
2. Owner agrees to pay Agent a fee of
5.6604% if
(a) Agent produces a buyer who is
ready, willing, and able to purchase the
Property on the terms described above or
on any terms acceptable to Owner, or
(b) the Property is sold or
exchanged by Agent, Owner, or by any other
party before the expiration of this
Listing Contract; or
(c) the Property is sold or
exchanged by Agent, Owner, or by any other
party within 60 days after the expiration
of this Listing Contract (the protection
period) to any party with whom Agent or
any cooperating REALTOR or cooperating
real estate broker has negotiated as a
prospective buyer, provided Agent has
notified Owner in writing within 10 days
of the expiration of this Listing Contract
of the name(s) of said prospective
buyer(s).
However, Owner shall not be obligated to pay such
fee if a valid listing contract is entered into
between Owner and another real estate broker and
the Property is sold, conveyed, or transferred
during the protection period.
Plaintiff alleged that the property was sold by defendant and that
plaintiff was the procuring cause of the sale.
In her answer, defendant denied that she owed a commission to
plaintiff because the sale of the property did not occur within the
exclusivity period of the listing contract and the property was not
sold to the prospect procured by plaintiff. Defendant alsoasserted several affirmative defenses to the enforcement of the
contract, including illegality of the contract, lack of
consideration, laches, and failure to perform the condition
precedent, as well as defenses to the unfair and deceptive
practices claim, including the unconstitutionality of Chapter 75
and exemption. Defendant also asserted that plaintiff's claim in
quantum meruit was barred by the express contract.
Plaintiff moved for summary judgment. At the conclusion of
the summary judgment hearing, Judge Eagles ruled that plaintiff was
entitled to partial summary judgment as to the amount of damages
recoverable by her, if the jury found in her favor on the issue of
defendant's breach of contract. Judge Eagles also granted
plaintiff summary judgment as to the defenses of illegality, lack
of consideration and unclean hands. Judge Eagles ruled that
defendant was entitled to partial summary judgment as to
plaintiff's claims for quantum meruit and unfair trade practices,
and as to the claims that defendant breached paragraph 2(b) or 2(c)
of the listing contract. The court found there was a disputed
issue of material fact as to whether plaintiff produced a buyer
pursuant to paragraph 2(a) of the listing contract, but stated
[t]o the extent defendant claims plaintiff cannot recover pursuant
to paragraph 2(a) because the property was not sold before [it's]
expiration [] or within 60 days of the expiration of the Listing
Contract, Summary Judgment is allowed for the plaintiff.
The disputed issue came on for trial before Judge Albright,
sitting without a jury, on 14 February 2000. Plaintiff's evidence
tended to show that plaintiff was the manager and leasing agent forThe Commerce Building property from 1987 to 1994. During this
period, defendant desired to sell the property and plaintiff
testified that she was the listing agent. Plaintiff left the
position and moved to Greensboro in 1994. However, in 1996,
defendant's daughter, Andrea Marsh, asked for plaintiff's
assistance in selling the building and plaintiff later negotiated
the listing contract with Andrea, who held defendant's power of
attorney. William Horton testified that he is the sole owner of a
real estate development business called DFI Group, Inc. (DFI),
which was an occupant of The Commerce Building. He stated that he
knew plaintiff as the building manager, and had ongoing
conversations with her dating back to the early 1990s about the
possibility of DFI purchasing The Commerce Building property. He
further testified that he and plaintiff had a meeting with Andrea
Marsh in 1995 or 1996 to discuss a purchase agreement, and that
Andrea stated the sales price was $1,000,000. This meeting, Horton
testified, was the first contact he had with any member of the
Marsh family. After the meeting, he suggested that plaintiff add
a sixty thousand dollar commission to the purchase agreement. The
resulting contract (first contract), dated 1 August 1996,
provided for a $1,060,000 purchase price and contained a provision
that $60,000 would be due to plaintiff upon closing as a brokerage
commission. Horton testified that DFI encountered problems
obtaining the financing for the property because there were
significant amounts of unexpected costs and future obligations to
bring the building into compliance with applicable codes in
Raleigh. DFI received extensions from defendant under the firstcontract to address these problems, but eventually was forced to
enter into another contract (second contract), which was executed
15 January 1997. Horton testified that plaintiff was not involved
in the negotiations for the second contract. Because DFI was
unable or elected not to obtain the financing under the second
contract, it assigned its rights under the contract to The Commerce
Building, L.L.C. (L.L.C.) on 23 January 1997. Horton testified
that he is a seventy percent owner of L.L.C., which was a new
entity incorporated for the purpose of closing on The Commerce
Building property. The sale closed in March of 1997 at a price of
$1,060,000. Horton additionally testified that it was his
understanding that the assignment of rights under the contract
would not affect the commissions owed to plaintiff, and that he
would not have paid the additional $60,000 if he had realized that
plaintiff was not going to be paid her commission. Defendant's
motion for directed verdict at the close of plaintiff's evidence
was denied.
Defendant presented her own testimony, that of her son,
Charles Marsh, and three attorneys who were involved in the
negotiations. She testified that plaintiff was not involved in
procuring the deal with L.L.C. She further testified that she
signed a deed to convey the property to DFI, but later authorized
her attorney to change the grantee's name to L.L.C. Charles Marsh
testified that he took over the negotiations related to the sale of
the property in the latter part of August 1996, and that the first
contract expired for lack of performance because DFI could not get
the financing. He testified that plaintiff was not involved in thenegotiations for the second contract, which did not provide for a
commission; instead the contract was for a flat purchase price of
$1,060,000. The attorneys testified to the substance of the
negotiations and the reason for the delays in closing.
At the conclusion of the trial, the court made findings of
fact and conclusions of law and entered a judgment for plaintiff in
the amount of $60,000 plus pre-judgment interest. Defendant
appeals from this judgment and both parties appeal from the order
granting partial summary judgment.
[1]The
standard
of appellate
review
for a decision rendered
in a non-jury trial is whether there is competent evidence to
support the trial court's
findings
of fact and whether the
findings
support the
conclusions
of law and ensuing
judgment
.
G.R. Little
Agency, Inc. v. Jennings, 88 N.C. App. 107, 362 S.E.2d 807 (1987).
Findings of fact are binding on appeal if there is competent
evidence to support them, even if there is evidence to the
contrary.
Id. at 112, 362 S.E.2d at 811.
Defendant contends the trial court's findings of fact nos. 2,
3, 13, 16 and 17 were erroneous for various reasons. We find
competent evidence in the record to support findings of fact nos.
2, 3 and 13, in which the trial court found that plaintiff worked
on the sale of the property prior to July 1996 at the request of
defendant and Andrea Marsh, that plaintiff approached Horton, who
was the 100% owner of DFI, about the feasibility of DFI purchasingthe property, and that DFI assigned its rights to purchase the
property under the second contract to L.L.C. of which Horton was a
70% owner. We agree with plaintiff that findings of fact no. 16
and no. 17 are not supported by the record. In finding of fact no.
16, the court quotes language from the mutual indemnity and release
agreement, which was not before the court at trial. Finding of
fact no. 17 provides:
Throughout all transactions it was
readily apparent to the parties that William
Horton through DFI, Group, Inc. could not
close due to difficulties known to the
parties. Discussions were held between the
parties regarding DFI, Group Inc.'s
difficulties in closing on the Property. In
addition, the threat of condemnation of the
building led the Seller to want to sell the
Property.
In fact, however, DFI's inability to close was not apparent until
September 1996 and therefore was not apparent throughout all
transactions. However, we deem these errors to be immaterial
because the findings are not essential to the judgment entered.
See Teague v. Teague, 84 N.C. App. 545, 353 S.E.2d 242 (1987).
Defendant next contends the trial court's findings of fact do
not support its conclusions of law and judgment. Defendant assigns
error to the following conclusions of law:
3. Plaintiff produced The Commerce Building,
L.L.C. as a buyer pursuant to paragraph 2(a)
of the Listing Contract.
4. Plaintiff originated a series of events
which, without break in their continuity,
resulted in the accomplishment of the prime
objective of employment, which was the sale of
the subject Property.
5. Plaintiff produced a buyer who was ready,
willing, and able to purchase the Property onthe terms described in the Exclusive Right to
Sell Listing Contract or on terms acceptable
to Defendant Marsh.
6. Plaintiff fulfilled her obligations under
the Exclusive Right to Sell Listing Contract
and is entitled to her commission of
$60,000.00.
Defendant first argues the conclusions of law are erroneous
because plaintiff did not produce L.L.C. as a buyer who was ready,
willing, and able to purchase the property pursuant to paragraph
2(a) of the listing contract. Defendant contends the original
purchaser, DFI, was unable to purchase the property, and the
property was ultimately sold to L.L.C. without plaintiff's
intervention.
The general rule is that a broker is entitled to a commission
whenever he procures a party who actually contracts for the
purchase of the property at a price acceptable to the owner.
Realty Agency, Inc. v. Duckworth & Shelton, Inc., 274 N.C. 243,
250-51, 162 S.E.2d 486, 491 (1968).
The broker is the procuring cause if the sale
is the direct and proximate result of his
efforts or services. The term
procuring cause
refers to 'a cause originating or setting in
motion a series of events which, without break
in their continuity, result in the
accomplishment of the prime object of the
employment of the broker, which may variously
be a sale or exchange of the principal's
property, an ultimate agreement between the
principal and a prospective contracting party,
or the procurement of a purchaser who is
ready, willing, and able to buy on the
principal's terms.'
Id. (quoting 12 C.J.S.
Brokers § 91, p. 209 (1938)).
Defendant argues that a broker is not the procuring cause when
the broker's prospect does not purchase the property individuallybut later, without the intervention of the broker, purchases the
property as part of a partnership or syndicate, and cites 12
Am.Jur.2d
Brokers § 238 and
Marshall v. White, 245 F.Supp. 514
(W.D.N.C. 1965), in support of this contention. The pertinent
language in § 238 provides:
[W]here a broker's prospect refuses or is
unable to purchase the property individually,
and thereafter, without the intervention of
the broker, the property is sold to a
partnership or syndicate of which the prospect
was a member at the time of the broker's
negotiation, or with which the prospect
subsequently became associated for the purpose
of purchasing the property, the broker is not
entitled to compensation.
In
Marshall, the broker introduced the seller to a prospective
lessee, Gilbert Winkenwerder. The lessor ultimately leased the
property to a separate entity, which was owned by Winkenwerder's
sons. The court noted that but for the broker's introduction of
the lessor to Winkenwerder, the sale would not have taken place;
however, the court said [t]he term 'procuring cause', as used in
describing a broker's activity, means more than 'but for'
causation.
Marshall, 245 F.Supp at 517. The court held that the
broker was not entitled to a commission, relying in part on the
above-quoted language from Am.Jur.2d.
Id.
Other jurisdictions, however, have not reached the same
conclusion as the court in
Marshall. In
Regional Redevelopment
Corp. v. Hoke, 547 A.2d 1006 (1988), the District of Columbia
Circuit Court of Appeals stated 'it is the general rule in this
country that a broker's right to a commission is not affected bythe fact that the customer procured by him became associated with
others who joined with such customer in the purchase of property.'
Id. at 1010 (quoting
Zetlin v. Scher, 241 Md. 590, 217 A.2d 266,
269 (1966). In a footnote, the court stated [c]ases cited for the
opposite result generally involve more extended time periods or
clearer termination of broker negotiations than in the case before
us; e.g.,
Marshall v. White, 245 F.Supp. 514, 516-17 (W.D.N.C.
1965);
English v. William George Realty Co., 55 Tex. Civ. App. 137,
117 S.W. 996 (1909).
Id. See also Perdue v. Gates, 403 So.2d
165, 170 (Ala. 1981) (stating there is conflicting authority on
whether a realtor is entitled to a commission for introducing a
prospective buyer who brings in partners or other parties as co-
purchasers).
The dispositive issue in these cases appears to be one of
proximate cause. As the Supreme Court noted in
Duckworth, [t]he
broker is the procuring cause if the sale is the direct and
proximate result of his efforts or services. 274 N.C. at 251, 162
S.E.2d at 491. We hold, under the circumstances of this case, that
the trial court did not err in concluding that plaintiff was the
procuring cause of the sale because the sale was the proximate
result of plaintiff's efforts. Unlike
Marshall where the broker
only introduced the parties, was uninvolved in the negotiations,
and never had a listing contract or discussed the issue of a
commission, the record in this case reflects that plaintiff was
involved in the negotiations pertaining to the first contract with
DFI and that there was no break in continuity between the first andsecond contracts. Moreover, Horton testified that he had no prior
contact with defendant or her family and, without plaintiff's
efforts, would not have been negotiating for the purchase of the
building. Therefore, it was not error for the trial court to
conclude that plaintiff was the procuring cause of the sale in this
case.
Defendant also assigns error to the denial of her motion for
summary judgment on the issue of whether plaintiff produced a buyer
who was ready, willing, and able to purchase the property because
she argues there was no genuine issue of material fact. [T]he
denial of a motion for summary judgment is not reviewable during
appeal from a final judgment rendered in a trial on the merits.
Harris v. Walden, 314 N.C. 284, 286, 333 S.E.2d 254, 256 (1985).
Therefore, this argument is not properly before the Court.
II.
[2]Defendant next argues that the court erred in granting
summary judgment for plaintiff as to the effect of the listing
contract's expiration on plaintiff's recovery under paragraph 2(a).
She argues that even if plaintiff produced a buyer who was ready,
willing, and able to purchase the property, this was not
accomplished until after the contract expired on its terms and,
therefore, plaintiff should be precluded from recovering her fee
under the contract. Defendant points to the limited four month
period of the contract, the language in paragraph (2)(b), which
states, Owner agrees to pay Agent a fee . . . if . . . the
Property is sold or exchanged . . . before the expiration of this
Listing Contract, and the language in paragraph (2)(c) whichprovides for payment of the fee if the property is sold by any
party within 60 days after the expiration of the contract.
In
Collins v. Ogburn Realty Co., 49 N.C. App. 316, 271 S.E.2d
512 (1980), the sellers of a home attempted to make a similar
argument where the exclusive listing contract gave the broker 120
days to sell the house at a designated price, and provided for a
commission if a prospect to whom the broker showed the home
purchased it within 90 days from the expiration of the listing
contract. In that case, an offer to purchase was made within the
120-day period but the buyers were unable to sell their previous
home, and the contract was not closed until one year later.
Id. at
317-18, 271 S.E.2d at 513. The court held:
There exists no dispute that the [broker]
performed the duty of presenting to the
[sellers] a party who actually contracted to
purchase their property upon terms acceptable
to them and that this was done well within the
120-day period set forth in the listing
agreement. Plaintiffs' contention that
defendants are precluded from recovering a
commission because of their failure to effect
a sale of the property within the 120-day
period is unavailing in view of the fact that,
as noted above, it is defendants' procurement
of 'a party who actually contracts for the
purchase of the property,' which determines
entitlement to a realtor's commission.
Id. at 320, 271 S.E.2d at 514-15 (citation omitted). Defendant
argues that the present case is distinguishable from
Collins
because the second sales contract, which is the contract that
actually produced the sale, was not put in force during the period
of the listing contract. This distinction, in our view, makes no
difference to the outcome of the case. During the period of thelisting agreement, defendant sought a $1,000,000 sales price and
plaintiff produced DFI Group, a corporation owned solely by Horton,
which entered into a contract for the purchase of the building.
Horton testified that plaintiff was the party who procured him and
that he would not have otherwise entered into negotiations for the
purchase of the building. Because of difficulty in obtaining
funding, DFI entered into the second contract for the purchase of
the property and later assigned its rights in this contract to
L.L.C., a corporation in which Horton is a seventy percent
shareholder. L.L.C. eventually purchased the property for
$1,060,000. As this Court said in
Collins, it is defendants'
procurement of 'a party who actually contracts for the purchase of
the property,' which determines entitlement to a realtor's
commission.
Id. Having held that plaintiff's efforts in
procuring DFI were the procuring cause of the eventual sale, we
hold that the court did not err in granting summary judgment to
plaintiff on the issue of the contract's expiration.
In addition, we disagree with defendant's argument that such
an interpretation of the listing contract renders a broker's
contractual rights perpetual. As noted above, to recover a
commission, a broker must procure the party who then purchases the
property.
Duckworth, 274 N.C. at 251, 162 S.E.2d at 491. To be
the procuring cause, the broker must set in motion a series of
events which,
without break in their continuity lead to the
procurement of a purchaser who is ready, willing and able to
purchase the property.
Id. (emphasis added).
Contrary todefendant's argument, no perpetual contractual rights are created
because the broker's right to recover is extinguished when there is
a break in the continuity of events. In the case before us, there
was no break in the continuity of events; therefore, plaintiff's
right to recover was not extinguished.
[3]Finally, we reject defendant's argument that plaintiff's
right to recover a commission under paragraph 2(a) was barred by
the terms of paragraph 14 of the first contract, which provided:
No party shall have any obligation for
commission unless a closing occurs pursuant to
the terms of this Contract. . . . Susan
Sessler joins in this Contract for the
purposes of acknowledging that the foregoing
constitutes her exclusive commission agreement
with Seller and Buyer with respect to the
property.
To give effect to defendant's argument, we would have to conclude
that the first contract, executed 1 August, modified the terms of
paragraph 2(a) of the listing contract, executed prior to 15 July.
However, to be enforceable a modification to a contract must be
supported by consideration.
Labarre v. Duke University, 99 N.C.
App. 563, 393 S.E.2d 321,
disc. review denied, 327 N.C. 635, 399
S.E.2d 122 (1990). Under the listing contract plaintiff promised
to procure a buyer willing to purchase the property for $1,000,000
in return for a commission of 5.6604%, which equals $60,000.
Paragraph 14 of the first contract provides, however, that
plaintiff is entitled to recover a commission of $60,000 only upon
closing of the contract between Horton and defendant for
$1,000,000. There is no benefit to plaintiff or detriment on the
part of defendant which would constitute consideration for thismodification. Accordingly, it is unenforceable and defendant's
argument must be rejected.
III.
[4]Defendant next argues, in the alternative, that the court
erred by granting summary judgment in favor of plaintiff with
respect to the defense asserting a lack of consideration for the
listing agreement. She contends issues of material fact exist
pertaining to plaintiff's consideration for the listing contract,
and that the listing contract is unenforceable because defendant
and Horton already knew each other in a landlord/tenant
relationship. She argues, in addition, that the commission
provision was added after the sale of the property had already been
discussed with Horton.
To be enforceable, a contract must be supported by
consideration.
Lee v. Paragon Group Contractors, Inc., 78 N.C.
App. 334, 337 S.E.2d
132 (1985),
disc. review denied, 316 N.C. 195,
345 S.E.2d 383 (1986). Consideration consists of 'any benefit,
right, or interest bestowed upon the promisor, or any forbearance,
detriment, or loss undertaken by the promisee.'
Id. at
338, 337
S.E.2d at 134 (citation omitted). The listing contract provides
that defendant will pay plaintiff a commission if plaintiff
procures a buyer who is ready, willing and able to purchase the
property upon the seller's terms, specified in the contract. On
its face, the document provides valuable and legal consideration.
Where there is consideration on the face of the document, the court
will not look for the adequacy of the consideration unless itconstitutes a fraud upon the party sought to be restrained.
Jewel Box Stores Corp. v. Morrow, 272 N.C. 659, 666, 158 S.E.2d
840, 845 (1968). There is no evidence that the document was
fraudulent as to defendant. Therefore we hold the trial court did
not err in granting summary judgment for plaintiff on the issue of
consideration.
IV.
[5]Plaintiff cross-appeals the grant of partial summary
judgment as to her claim for unfair and deceptive practices. A
court may grant summary judgment if in viewing the pleadings,
affidavits and discovery materials available in the light most
favorable to the non-moving party, to determine whether any genuine
issues of material fact exist and whether the moving party is
entitled to judgment as a matter of law.
Pine Knoll Ass'n, Inc.
v. Cardon, 126 N.C. App. 155, 158, 484 S.E.2d 446, 448,
disc.
review denied, 347 N.C. 138, 492 S.E.2d 26 (1997); N.C.R. Civ. P.
56 (2000). Defendant argues that a genuine issue of material fact
existed as to whether defendant's actions were unfair or deceptive
within the definition of G.S. § 75-1.1. To establish a
prima
facie claim for
unfair
and
deceptive practices
, plaintiff must show
that: '(1) defendant committed an unfair or deceptive act or
practice, (2) the action in question was in or affecting commerce,
N.C.
Gen. Stat. 75-1.1, and (3) the act proximately caused injury
to the plaintiff.'"
Prince v. Wright, 141 N.C. App. 262, 268, 541
S.E.2d 191, 196 (2000) (quoting
Pleasant Valley Promenade v.
Lechmere, Inc., 120 N.C. App. 650, 664, 464 S.E.2d 47, 58 (1995)). An unfair practice is one that is 'immoral, unethical, oppress
ive,
unscrupulous, or substantially injurious to customers.'
Branch
Banking and Trust Co. v. Thompson, 107 N.C. App. 53, 61, 418 S.E.2d
694, 700,
disc. review denied, 332 N.C. 482, 421 S.E.2d 350 (1992)
(quoting
Johnson v. Phoenix Mut. Life Ins. Co., 300 N.C. 247, 263,
266 S.E.2d 610, 621 (1980)). A practice is deceptive if it 'has
the capacity or tendency to deceive.'
Id.
It is well recognized, however, that actions
for unfair or deceptive trade practices are
distinct from actions for breach of contract .
. . and that a mere breach of contract, even
if intentional, is not sufficiently unfair or
deceptive to sustain an action under N.C.G.S.
§ 75-1.1.
Id. (citation omitted). Instead, a plaintiff must 'show
substantial aggravating circumstances attending the breach to
recover under the Act.'
Id. (quoting
Bartolomeo v. S.B. Thomas,
Inc., 889 F.2d 530, 535 (4th Cir. 1989)).
In ruling on the motion for summary judgment, Judge Eagles had
before her the contracts, the affidavits of plaintiff, Charles
Marsh, and four attorneys who were involved in the negotiations, as
well as letters from Horton attesting to plaintiff's role in the
negotiations and in procuring him as the buyer. This evidence
indisputably demonstrated that the inability to close on the first
contract and the delay in closing on the second contract were
caused by DFI's difficulty in obtaining the financing to purchase
the building, and not by any effort on the part of defendant to
deceive plaintiff. Though plaintiff contends in her brief therevisions of the agreements between defendant and Horton were a
façade of paperwork to give the appearance of a new transaction
with a new buyer, the evidence before the trial court belies this
characterization. Gilbert C. Laite, III, an attorney who
represented defendant during the negotiations, testified that he
attended a meeting in February 1997 in which an accountant for DFI
stated that it could not make the deal work financially on its own
and that DFI needed a guarantor to make the purchase and was
having difficulty obtaining guarantors because of certain building
code requirements. The incorporation of L.L.C. to purchase the
property is consistent with DFI's difficulty in obtaining
guarantors. Even taking the evidence that was before the court on
this motion in the light most favorable to plaintiff, we hold that
the court did not err in granting summary judgment on this issue
because plaintiff has failed to show substantial aggravating
circumstances attending the breach of contract.
Affirmed.
Judges HUNTER and HUDSON concur.
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