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All opinions are subject to modification and technical correction prior to official publication in the North Carolina Reports and North Carolina Court of Appeals Reports. In the event of discrepancies between the electronic version of an opinion and the print version appearing in the North Carolina Reports and North Carolina Court of Appeals Reports, the latest print version is to be considered authoritative.
MADELINE BECKER, JOHN YAHN, DAVID BECKER, and JOHN BECKER,
Plaintiffs v. N.C. DEPARTMENT OF MOTOR VEHICLES, Defendant.
Filed: 2 May 2006
Bailments_lawful seizure_implied bailment not created
The Industrial Commission erred by concluding that a bailment was created by the lawful
seizure of motor vehicles and parts from plaintiffs, who were alleged to be operating a junk yard
and car dealership without a license. The seizure of property is a unilateral act which does not
suggest the mutual intent necessary to form even an implied bailment contract. Moreover, there
were no findings about breach of duty or proximate cause, no findings about the standard of care,
and all of the findings indicated that defendant used commensurate care.
Appeal by defendant from Decision and Order entered 3 January
2005 by the North Carolina Industrial Commission. Heard in the
Court of Appeals 6 March 2006.
The Vincent Law Firm, P.C., by Branch W. Vincent, III.
Roy A. Cooper, III, Attorney General, by Dahr Joseph Tanoury,
Assistant Attorney General, for the State.
MARTIN, Chief Judge.
On 25 October 2001, plaintiffs filed claims with the North
Carolina Industrial Commission for damages under the Tort Claims
Act, alleging negligence on the part of the Department of Motor
Vehicles and its agents and employees. The claim arose from the 27
October 1998 seizure and subsequent storage of numerous motor
vehicles and vehicle component parts. Acting on an informant's tip
that plaintiffs were operating a junk yard and car dealership
without a license, DMV inspectors entered plaintiffs' property,
noticed a forged window inspection sticker on a vehicle, and, upon
further investigation, discovered that the public vehicleidentification numbers (PVINs) on other vehicles either did not
match the confidential vehicle identification numbers (CVINs) or
were missing, which can be an indication of theft. Plaintiffs John
and David Becker were arrested on misdemeanor and felony charges of
violating the North Carolina Motor Vehicle code, and their vehicles
were taken to Grant's Texaco for holding while the criminal case
was pending. The Industrial Commission found as a fact that
[t]his seizure created a bailment by implication, with the owners
of the vehicles being the bailors.
At the time of the seizure, the DMV inspector informed
plaintiffs that the vehicles were being seized due to the missing
and altered PVINs, calling the title and rightful ownership of the
vehicles into question. The vehicles could not be returned until
proper vehicle identification numbers were applied for and assigned
because it is illegal to possess a vehicle with a missing or
altered PVIN. David Becker was acquitted of the criminal charges,
and the charges against John Becker were dismissed by the district
attorney. Plaintiffs requested special VIN numbers for the seized
vehicles in 2001 and the vehicles were returned to plaintiffs,
except for a junked white Camero plaintiffs exchanged with Grant's
Texaco for the $600.00 storage fee. Other property was lost or
damaged and a carburetor was also stolen from one of the vehicles
while it was in storage, but it is not known who stole it, how
such persons gained access to the vehicle, or what acts or
omissions, if any, on the part of Grant's contributed to the
theft. The Industrial Commission found that plaintiffs participated
in repairing automobiles as a family hobby, and that due to this
collective experience in automobile and engine repair they could
credibly assess the value of automobile parts that were either
lost or damaged while in storage. The Commission found damages of
$6,025.00 for David Becker, $2,050.00 for John Becker, $13,397.50
for John Yahn and $3,575.00 for Madeline Becker. Based on these
facts, the Industrial Commission concluded as a matter of law that:
1. It is plaintiffs' burden to prove that all
the elements of negligence, including that
defendant breached an owed duty of care, and
that the breach was the proximate cause of
plaintiff's injury. The evidence must be
sufficient to raise more than speculation,
guess, or mere possibility.
2. Plaintiffs failed to show by the greater
weight of the evidence that defendant's
employees breached a duty of care owed to
plaintiffs by defendant with respect to the
arrests and criminal prosecutions. Plaintiffs
are entitled to no damages for loss of wages,
claimed emotional distress, costs of bail, or
costs of criminal trial transcripts or costs
of civil trial transcripts. In addition,
defendant proved that plaintiffs' reputations
were not harmed by the actions of the
enforcement officers in the carrying out of
their lawful duties.
3. It is well-settled that once a bailment
contract is created between a bailor and
bailee, either expressly or by implication,
the bailee is charged with a duty of care to
protect the bailed property from damage or
loss. When a bailee fails to return or deliver
the bailed property in an undamaged condition,
the bailor may bring an action to recover
damages for breach of bailment contract and/or
negligence based on proof that the bailee
failed to exercise due care to safeguard the
bailed property from damage, loss, or theft.
See 46 Am. Jur. Proof of Facts 3d 361.
4. Plaintiffs proved that employees of
defendant seized their vehicles, creating a
bailment by implication. Plaintiffs also
proved that defendant failed to return or
deliver the bailed property in an undamaged
condition and that department [sic] failed to
exercise due care to safeguard the bailed
property from damage, loss, or theft.
5. Under the circumstances of this case, the
damages set forth in paragraph 73 of the
findings of fact are proper damages with
respect to the negligence of defendant in
failing to care for and return the bailed
The Industrial Commission ordered defendant to pay damages to
plaintiffs in accordance with its findings. Defendant appeals.
Defendant argues that the Industrial Commission erred as a
matter of law when it concluded that the lawful seizure created a
bailment by implication between plaintiffs and defendant. For the
reasons stated below, we agree.
Our standard of review under the Tort Claims Act is well
The standard of review for an appeal from the
Full Commission's decision under the Tort
Claims Act shall be for errors of law only
under the same terms and conditions as govern
appeals in ordinary civil actions, and the
findings of fact of the Commission shall be
conclusive if there is any competent evidence
to support them. N.C. Gen. Stat. § 143-293
Simmons v. Columbus Cty. Bd. of Educ.
, 171 N.C. App. 725, 727-28,
615 S.E.2d 69, 72 (2005). Our Supreme Court has stated that to
give the Industrial Commission jurisdiction of a tort claim, the
claim must be based on negligence. Collins v. North CarolinaParole Commission
, 344 N.C. 179, 183, 473 S.E.2d 1, 3 (1996). To
establish a claim for negligence under the Tort Claims Act,
plaintiff must show that (1) [defendant] owed plaintiff a duty of
care; (2) the actions, or failure to act, by [defendant]'s named
employee breached that duty; (3) this breach was the actual and
proximate cause of plaintiff's injury; and (4) plaintiff suffered
damages as a result of such breach. Simmons v. N.C. Dept. Of
, 128 N.C. App. 402, 406, 496 S.E.2d 790, 793 (1998);
N.C. Gen. Stat. § 143-291 (2005).
Here, rather than make findings with respect to the issue of
defendant's negligence, the Industrial Commission determined that
a bailment was created by the lawful seizure of plaintiffs'
vehicles, and, as a result, defendant could be held liable for any
damage to plaintiffs' property. The Industrial Commission
misconstrued the concept of bailment.
This Court has previously held that a bailment is created
upon the delivery of possession of goods and the acceptance of
their delivery by the bailee. Atlantic Contr'g & Material Co. v.
, 161 N.C. App. 273, 277, 588 S.E.2d 36, 39 (2003) (internal
citation omitted). Liability for any damages to the [goods] while
in [bailee]'s possession turns upon the question of the presence or
absence of actionable or ordinary negligence on its part. Mills,
Inc. v. Terminal, Inc.
, 273 N.C. 519, 521, 160 S.E.2d 735, 738
(1968). A bailor must offer evidence showing that the property
was delivered to the bailee; that the bailee accepted it and
thereafter had possession and control of it; and that the bailee. . . returned it in a damaged condition to create a prima facie
case of negligence, and, once a prima face case has been made, the
bailor retains the burden of proof. McKissick v. Jewelers, Inc.
41 N.C. App. 152, 155-56, 254 S.E.2d 211, 213 (1979) (internal
Here there are no findings of fact regarding delivery and
acceptance between plaintiffs and defendant. While the Commission
concluded that defendant's seizure created a bailment by
implication, it made no findings of fact regarding any delivery of
goods by plaintiffs or acceptance by defendant, which are necessary
elements of a prima facie case of negligence on a bailment
contract. The Commission found only that the property was seized,
and after the criminal investigation was completed, the property
was returned in damaged condition. The Industrial Commission
failed to cite, and our own research does not reveal, any basis in
the law of this State for the proposition that a lawful seizure,
pursuant to the government's police powers, creates a bailment of
the property which is seized. We decline to extend the duty of
care created by a bailment to lawful seizures. The seizure of
property is a unilateral act which does not suggest the mutual
intent necessary to form even an implied bailment contract.
Even assuming arguendo
that the Industrial Commission's
findings of facts support the conclusion that an implied bailment
was created, its findings of fact remain inadequate to award
plaintiffs damages. The finding of a bailment satisfies only the
first element of a claim for negligence under the Tort Claims Act,establishing a duty of care; however, there are no findings of
breach of this duty or proximate cause in this case. There are no
findings of fact regarding the standard of care owed by either the
officers or defendant regarding the storage of plaintiffs' goods
after they had been seized, nor are there findings regarding the
proximate cause of the damage, despite the implication that the
vehicles were subject to theft while in storage. See, e.g.
, 41 N.C. App. at 156, 254 S.E.2d at 213 (holding no
recovery from bailee jewelry store in bailment for mutual benefit
situation where items left for repair were stolen from bailee).
Instead, the findings by the Industrial Commission indicated
that defendant used commensurate care, noting that 1) the length of
time the property was stored was not unusual; 2) plaintiffs knew
where their property was and why it was seized; and 3) unknown
individuals stole the carburetor from the vehicle while it was at
Grant's. The Commission left unresolved the question of Grant's
liability regarding the carburetor. Moreover, plaintiffs' initial
claim was for negligent investigation by defendant, and the
Industrial Commission explicitly found that [t]here has been no
finding that the officers did not have probable cause for the
arrests they made and further found that the seizures were due to
the missing PVINs and pending criminal charges.
Judges WYNN and STEPHENS concur.
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