An unpublished opinion of the North Carolina Court of Appeals does not constitute controlling legal authority. Citation is disfavored, but may be permitted in accordance with the provisions of Rule 30(e)(3) of the North Carolina Rules of Appellate Proced ure.

NO. COA04-473


Filed: 18 January 2005


v .                         Mecklenburg County
                            No. 02 CVS 8572

    Appeal by plaintiff and defendants from order entered 3 December 2003 by Special Superior Court Judge for Complex Business Cases Ben F. Tennille. Heard in the Court of Appeals 1 December 2004.

    Knox, Brotherton, Knox & Godfrey, by Lisa G. Godfrey, for plaintiff.

    Roberts & D'Agostino, by Daniel D. D'Agostino, for defendants.

    LEVINSON, Judge.

    Plaintiff Mechanical Systems & Services, Inc., is in the business of the construction and maintenance of mechanical systems for commercial customers. The company was founded in 1996 by Hunter Edwards. Defendants Larry D. Copeland and Rodney L. Gordon were two of the first employees of Mechanical. As an inducement to join Mechanical, Edwards offered Copeland and Gordon various incentives, including a five percent ownership interest in the company if they remained employed there for two years.    On 14 May 1998, Mechanical amended its articles of incorporation to create two classes of stock. Holders of Class One stock were given voting rights while holders of Class Two stock were not. On 1 June 1998, Mechanical's Board of Directors authorized the issuance of Class Two stock to certain employees for $1 per share. Mechanical issued fifty shares of Class Two stock, which allegedly represented a five percent ownership interest, to both Copeland and Gordon.
    Pursuant to authorization from its board of directors, Mechanical executed a stock restriction agreement with the holders of Class Two Stock, including Copeland and Gordon. Under the agreement, a Class Two shareholder, who is also a Mechanical employee, must sell his shares back to the company upon termination of employment for $1 per share. The agreement states that Mechanical has sixty days following termination of employment to notify an employee-shareholder of the company's intent to repurchase outstanding shares. The agreement further provides that it supersedes all prior agreements between the parties.
    On 25 March 2002, Copeland and Gordon terminated their employment to start Carolina Air Solutions, L.L.C., which is also named as a defendant in the instant case. Several days later, Mechanical sent a letter to Copeland and Gordon stating that it intended to repurchase all of their Class Two Shares at $1 per share as provided in the stock restriction agreement. Copeland and Gordon each responded via letter indicating that they did not intend to sell the shares back to Mechanical at $1 per share.    On the day that they terminated their employment with Mechanical, Copeland and Gordon placed a bid for mechanical contract work at the Jonas Federal Building in Charlotte. The project involved rebuilding and replacing a defective chiller, which Gordon had discovered while working as a service technician for Mechanical. The project was a publicly bid contract, and Mechanical had previously placed a bid for the work. The trial court found that the bid placed by Copeland and Gordon did not incorporate any confidential information obtained during their tenure at Mechanical.
    On 15 May 2002, Mechanical filed a complaint against Carolina Air, Copeland, and Gordon seeking enforcement of a contractual right to buy back Copeland and Gordon's stock in Mechanical and damages for misappropriation of trade secrets, breach of fiduciary duty, tortious interference with a business relationship, repayment of advance commissions, and unfair and deceptive trade practices. On 10 July 2002, defendants filed an answer and counterclaims seeking production of corporate documents and damages for breach of contract, misrepresentation, and fraud. Defendants also sought a monetary award equal to the value of Copeland and Gordon's five percent ownership interest in Mechanical.
    Plaintiff and defendants moved for partial summary judgment. Following arguments, the trial court entered an order in which it made the following ruling:
    The mandatory sell[-]back at $1 per share is unconscionable and therefore unenforceable. There is neither an enforceable buy[-]back provision at fair market value nor any statutory basis upon which the[c]ourt could order a buy[-]back based on the allegations in the counterclaims. The parties are left with Copeland and Gordon owning their Class Two stock on an unrestricted basis. Defendants are entitled to summary judgment on all of plaintiff's claims.

    The trial court's order did not dispose of defendants' claims for misrepresentation or fraud. Both parties have taken an appeal from the trial court's order. For the reasons that follow, we conclude that the parties' appeals must be dismissed as interlocutory.
    An order “is either interlocutory or the final determination of the rights of the parties.” N.C.G.S. § 1A-1, Rule 54(a) (2003). A final judgment “disposes of the cause as to all the parties, leaving nothing to be judicially determined between them in the trial court[,]” while an interlocutory order “does not dispose of the case, but leaves it for further action by the trial court in order to settle and determine the entire controversy.” Veazey v. City of Durham, 231 N.C. 354, 361-62, 57 S.E.2d 377, 381 (1950).
    In general, there is no right to appeal from an interlocutory order. N.C.G.S. § 1A-1, Rule 54(b) (2003); Jeffreys v. Raleigh Oaks Joint Venture, 115 N.C. App. 377, 379, 444 S.E.2d 252, 253 (1994). However, there are two significant exceptions to this rule. First, an interlocutory order is immediately appealable “when the trial court enters 'a final judgment as to one or more but fewer than all of the claims or parties' and the trial court certifies in the judgment that there is no just reason to delay the appeal.” Id. (quoting Rule 54(b)). Second, an interlocutory order may be immediately appealed if “the order deprives the appellant ofa substantial right which would be jeopardized absent a review prior to a final determination on the merits.” Southern Uniform Rentals, Inc. v. Iowa Nat'l Mutual Ins. Co., 90 N.C. App. 738, 740, 370 S.E.2d 76, 78 (1988).
    In the instant case, the order appealed from does not dispose of defendants' claims for misrepresentation and fraud. As these claims are still pending, the trial court's order is interlocutory. The trial court has not made a certification pursuant to Rule 54(b), and the instant case does not implicate a substantial right. Accordingly, we have no alternative except to dismiss the parties' interlocutory appeals. In addition, we observe that as a part of its final order, the trial court should expressly state whether defendants' Class Two shares are voting or non-voting.
    Judges HUNTER and CALABRIA concur.
    Report per Rule 30(e).

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