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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.
PARK EAST SALES, LLC, Plaintiff, v. CLARK-LANGLEY, INC.; DELLA
CLARK EDWARDS; CARMEL CONTRACTORS, INC.; LOWE'S HOME CENTERS,
INC.; and WESTERN SURETY COMPANY, Defendants
Filed: 2 October 2007
1. Appeal and Error_appealability_denial of motion to stay_necessity for petition for
writ of certiorari
In an action in which plaintiff second tier subcontractor seeks to enforce its statutory
mechanic's lien against the property owner, contractor, and contractor's surety for rental
equipment furnished to a first tier site preparation subcontractor, defendants have no right to
appeal from the trial court's failure to grant their motion for a stay pending final disposition of a
bankruptcy action filed by the first tier subcontractor because they failed to petition for a writ of
certiorari as required by N.C.G.S. § 1-75.12(c). Furthermore, defendants' appeal from the denial
of their motion to stay will not be treated as a petition for a writ of certiorari because plaintiff
does not attempt to collect sums due from the first tier subcontractor which filed for bankruptcy
but seeks to enforce its statutory lien claim against other defendants.
2. Liens_second tier subcontractor_claim of lien on funds_summary judgment
Summary judgment for plaintiff second tier subcontractor cannot be sustained on the
basis of a claim of lien on funds under N.C.G.S. § 44A-18(2) in an action in which plaintiff seeks
to enforce a statutory lien against the property owner, contractor and contractor's surety for rental
equipment furnished to a first tier subcontractor because a genuine issue of material fact exists as
to whether an unpaid contract balance remains between the contractor and the first tier
subcontractor where defendants asserted in interrogatories that the contractor owed no money to
the first tier subcontractor because the remaining contract balance was depleted by costs incurred
by the contractor to complete the subcontractor's contractual obligations due to its default.
3. Liens_second tier subcontractor_claim of lien on property_summary judgment
Summary judgment for plaintiff second tier subcontractor cannot be sustained on the
basis of a claim of lien on real property under N.C.G.S. § 44A-23(b)(1) in an action in which
plaintiff seeks to enforce a statutory lien against the property owner, contractor and contractor's
surety for rental equipment furnished to a first tier subcontractor because an affidavit of the first
tier subcontractor's president created a genuine issue of material fact as to the amount plaintiff is
owed on its contract with the first tier subcontractor and thus the amount of its lien claim.
Chief Judge MARTIN concurring in part and dissenting in part.
Appeals by defendants Carmel Contractors, Inc., Lowe's Home
Centers, Inc., and Western Surety Company from order and judgment
entered 10 August 2006 by Judge Carl R. Fox in Wake County Superior
Court. Heard in the Court of Appeals 20 August 2007.
Bugg & Wolf, P.A., by William J. Wolf and William R. Sparrow,
Shumaker, Loop & Kendrick, LLP, by Steele B. Windle, III, and
Daniel R. Hansen, for defendants-appellants.
Carmel Contractors, Inc. (Carmel) and Lowe's Home Centers,
Inc. (Lowe's) (collectively, defendants) appeal from order and
judgment entered granting Park East Sales, LLC's (plaintiff)
motion for summary judgment and denying their motion to stay or
dismiss. Western Surety Company (Western) also appeals from the
order and judgment entered granting plaintiff's motion for summary
judgment and denying its motion for judgment on the pleadings. We
dismiss in part, reverse in part, and remand.
On 8 March 2004, Lowe's entered into a contract with Carmel to
construct a Lowe's Home Improvement Store (project) in Cary,
North Carolina. On 10 March 2004, Carmel entered into a
subcontract agreement with Clark-Langley, Inc. (Clark), as the
grading and site work subcontractor.
In February 2004, Clark entered into an a rental agreement
with plaintiff. From 25 February 2004 through 28 January 2005,
plaintiff provided rental equipment, labor, and materials to Clark
for use on the project. Clark agreed to pay for the use and
transportation of and maintenance and repairs on the equipment
within thirty days of each invoice date. Clark also agreed to payplaintiff interest on all overdue balances at the highest rate
permitted by law.
By November 2004, Clark was delinquent on invoice payments to
plaintiff. Plaintiff made repeated demands for payment. Defendant
Della Clark Edwards (Edwards), the president of Clark,
guaranteed in writing that she would pay plaintiff for all
obligations Clark incurred thereafter.
On 18 January 2005, plaintiff served a notice of claim of lien
for $392,581.48, plus interest and attorney's fees, to Lowe's,
Carmel, and Clark. Lowe's made three further payments to Carmel on
21 January 2005, 28 February 2005, and 25 March 2005, totaling
$1,629,911.00. On 25 May 2005, plaintiff filed a notice of claim
of lien for $441,170.77 plus interest and attorney's fees with the
Wake County Clerk of Superior Court. Lowe's retained
$1,011,771.00, an amount sufficient to satisfy plaintiff's lien
claims. Carmel responded that no unpaid contract balance was owed
to Clark at that time because of costs it had incurred and paid to
complete Clark's contractual obligations.
Plaintiff filed its initial complaint on 16 June 2005 to
enforce its lien rights against Clark, Edwards, Carmel, and Lowe's.
Plaintiff amended its complaint on 18 August 2005, to add Western
as a party, after receiving notice that Carmel had obtained a lien-
discharge bond from Western as surety for plaintiff's claim of lien
on the project property.
On 6 October 2005, a default judgment was entered against
Clark and Edwards for failure to file a responsive pleading. Clarkfiled bankruptcy in the U.S. Bankruptcy Court on 14 October 2005
and instituted an adversary proceeding to determine the amount of
money, if any, owed by Carmel. Carmel counterclaimed and moved to
compel all of Clark's sixteen subcontractors, including plaintiff,
to litigate their claims in bankruptcy court.
On 8 June 2006, plaintiff filed a motion for summary judgment
against defendants and Western. Defendants requested the trial
court stay further proceedings pending final disposition in the
bankruptcy action to avoid substantial injustice. Defendants
also asserted plaintiff must obtain a judicial determination of the
amount owed by Clark before pursuing its mechanic's lien claim.
Western moved for judgment on the pleadings, asserting
plaintiff's claim was not ripe until a final judgment on
plaintiff's lien claims has been rendered in bankruptcy court.
Western described plaintiff's assertion to add it as a party in the
State court action as premature and unwarranted.
On 10 August 2006, the trial court granted plaintiff's motion
for summary judgment. The trial court entered an order and
judgment finding Lowe's to be liable for $392,581.48, plus
prejudgment interest, and finding Carmel and Western to be jointly
and severally liable for $441,170.70 plus prejudgment interest.
The trial court also denied the motion to stay or to dismiss made
by Lowe's and Carmel and denied the motion for judgment on the
pleadings made by Western. Defendants appeal.
Defendants argue the trial court erred by: (1) denying theirmotion to stay or alternatively to dismiss the lawsuit due to the
pending bankruptcy action and (2) granting plaintiff's motion for
summary judgment. Western argues the trial court erred by denying
its motion for judgment on the pleadings.
III. Standard of Review
A. Motion to Stay
The trial court may enter a stay [i]f, in any action pending
in any court of this State, the judge shall find that it would work
substantial injustice for the action to be tried in a court of this
State. N.C. Gen. Stat. . 1-75.12 (2005). This court has held the
denial of a motion to stay or dismiss rests within the sound
discretion of the trial judge and will not be disturbed on appeal
absent an abuse of that discretion. Home Indem. Co. v.
Hoechst-Celanese Corp., 99 N.C. App. 322, 325, 393 S.E.2d 118, 120
(citing Motor Inn Management, Inc. v. Irvin-Fuller Dev. Co., 46
N.C. App. 707, 711, 266 S.E.2d 368, 370, disc. rev. denied and
appeal dismissed, 301 N.C. 93, 273 S.E.2d 299 (1980)), disc. rev.
denied and appeal dismissed, 327 N.C. 428, 396 S.E.2d 611 (1990).
B. Summary Judgment
Summary judgment is appropriate if the pleadings,
depositions, answers to interrogatories, and admissions on file,
together with the affidavits, if any, show that there is no genuine
issue as to any material fact and that any party is entitled to a
judgment as a matter of law. N.C. Gen. Stat. . 1A-1, Rule 56(c)
(2005). The trial court must consider the evidence in the light
most favorable to the non-moving party. Summey v. Barker, 357 N.C.492, 496, 586 S.E.2d 247, 249 (2003). If a genuine issue of
material fact exists, a motion for summary judgment should be
denied. Howerton v. Arai Helmet, Ltd., 358 N.C. 440, 471, 597
S.E.2d 674, 694 (2004). If the granting of summary judgment can
be sustained on any grounds, it should be affirmed on appeal.
Shore v. Brown, 324 N.C. 427, 428, 378 S.E.2d 778, 779 (1989). On
appeal, an order allowing summary judgment is reviewed de novo.
Howerton, 358 N.C. at 470, 597 S.E.2d at 693 (citing Summey, 357
N.C. at 496, 586 S.E.2d at 249).
IV. Defendants' Appeal
A. Motion to Stay or Dismiss
 Defendants argue the trial court abused its discretion in
denying Carmel's motion to stay, or alternatively to dismiss
plaintiff's state court action under N.C. Gen. Stat. § 1-75.12. We
dismiss this assignment of error.
N.C. Gen. Stat. § 1-75.12(c) (2005) provides, [w]henever a
motion for a stay is made pursuant to subsection (a) . . . is
denied, the movant may seek review by means of a writ of certiorari
and failure to do so shall constitute a wavier of any error the
judge may have committed in denying the motion. (Emphasis
supplied). Defendants assert both in their brief and at oral
argument, [s]ince a notice of appeal was filed, seeking a writ of
certiorari would be duplicative, unnecessary and not required by
Rule 21 of the North Carolina Rules of Appellate Procedure. We
Under N.C. Gen. Stat. § 1-75.12(c), defendants have no rightto appeal from the trial court's failure to grant their motion to
stay the action because they failed to petition for a writ of
certiorari. Jaeger v. Applied Analytical Indus. Deutschland GMBH,
159 N.C. App. 167, 173, 582 S.E.2d 640, 645 (2003); see Saxon v.
Smith, 125 N.C. App. 163, 174, 479 S.E.2d 788, 795 (1997)
(Electing to treat defendants' assignment of error directed to
this issue as a petition for writ of certiorari, . . . we perceive
no abuse of discretion in the denial of defendants' motion.).
Defendants failed to petition this Court for a writ of certiorari.
In our discretion, we decline ex mero motu to treat defendants'
assignment of error as a petition for writ of certiorari and
dismiss this assignment of error.
The dissenting opinion asserts this Court should: (1)
exercise its discretion to allow and treat defendants' assignment
of error as a petition for writ of certiorari, even though
defendants failed to petition or argue to this Court in their brief
or in oral argument for this remedy and (2) find the trial court's
ruling manifestly unsupported by reason, an abuse of discretion,
and reverse and remand to the trial court with instructions to
grant a stay until issues involving Clark are resolved in
Clark's filing in bankruptcy court operated as an automatic
stay preventing all collection efforts against it pursuant to 11
U.S.C. § 362 (2005). Plaintiff is not attempting to collect sums
due from Clark. Plaintiff is enforcing its statutory lien claims
against Lowe's, Carmel, and Western and is asserting claimsindividually against Edwards. Determining these amounts are not an
effort at collection against Clark.
Edwards, who is a personal guarantor of a portion of Clark's
debt to plaintiff, did not file for bankruptcy. Clark's automatic
stay does not apply to her or any of the other parties in this
case. Edwards's affidavit, as discussed below, creates a genuine
issue of material fact of the sums, if any, owed to plaintiff. The
trial court must determine the amount of plaintiff's lien before
judgment can be entered.
To adopt the dissenting opinion's assertions would set a
dangerous precedent. Reversing and remanding this case to the
trial court with instructions to enter a total stay until the
resolution of Clark's bankruptcy will compel a stay to be entered
in any pending multi-party state action where only one party later
files bankruptcy. While some of the issues in the federal
bankruptcy may overlap with the issues in this state lien action,
the issues in both actions are not identical. Setoffs, defenses,
and preferential payment recaptures exist in the bankruptcy action
that are not available to the other parties in this action. See 11
U.S.C. § 547 (2005); 11 U.S.C. § 553 (2005); 11 U.S.C. § 558
B. Summary Judgment Motion
Defendants argue the trial court erred in granting plaintiff's
summary judgment motion by failing to consider Edwards's affidavit
and because genuine issues of material fact exist on whether
plaintiff had a valid mechanic's lien. We agree. The trial court's order and judgment entered 10 August 2006
states it review[ed] the discovery responses of record,
affidavits, briefs, and arguments of counsel. (Emphasis
supplied). We presume the trial court reviewed Edwards's affidavit
dated 31 July 2006 prior to entering its order and judgment. The
trial court's order and judgment does not state which type of lien
asserted entitled plaintiff to summary judgment. Because summary
judgment should be affirmed on appeal if it can be sustained on any
ground, we will determine whether summary judgment can be sustained
based on a claim of lien on funds under N.C. Gen. Stat. § 44A-18(2)
or a claim of lien on property under N.C. Gen. Stat. § 44A-
1. Claim of Lien on Funds
 N.C. Gen. Stat. § 44A-18(2) (2003) provides:
A second tier subcontractor who furnished
labor, materials, or rental equipment at the
site of the improvement shall be entitled to a
lien upon funds that are owed to the first
tier subcontractor with whom the second tier
subcontractor dealt and which arise out of the
improvement on which the second tier
subcontractor worked or furnished materials.
A second tier subcontractor, to the extent of
his lien provided in this subdivision, shall
also be entitled to be subrogated to the lien
of the first tier subcontractor with whom he
dealt provided for in subdivision (1) of this
section and shall be entitled to perfect it by
notice to the extent of his claim.
Our Supreme Court held second-tier subcontractors have no
right to assert a claim of lien upon funds under N.C. Gen. Stat. §
44A-18 when no funds are owed to the first-tier subcontractor at or
after the time the second-tier subcontractor files its claim oflien. Electric Supply Co. v. Swain Elec. Co., 328 N.C. 651, 654,
403 S.E.2d 291, 293 (1991) (Since nothing was owed to the first-
tier subcontractor at or after the time that the second-tier
subcontractor filed its lien claim, it was undisputed that the
second-tier subcontractor had no lien rights upon funds under N.C.
Gen. Stat. § 44A-18.).
In their response to plaintiff's first set of interrogatories,
defendants asserted Carmel owed no money to Clark because the
remaining contract balance was depleted by costs incurred by Carmel
in completing Clark's contractual obligations due to [its]
default. If Carmel owes no money to Clark, plaintiff has no right
to assert a claim of lien on funds under N.C. Gen. Stat. § 44A-18.
A genuine issue of material fact exists on whether an unpaid
contract balance remains between Carmel and Clark. Summary
judgment cannot be sustained based on a lien on funds. N.C. Gen.
Stat. § 44A-18(2).
2. Claim of Lien on Real Property
 N.C. Gen. Stat. § 44A-23(b)(1) (2003) provides:
A second or third tier subcontractor, who
gives notice as provided in this Article, may,
to the extent of his claim, enforce the lien
of the contractor created by Part 1 of Article
2 of the Chapter except when:
a. The contractor, within 30 days
following the date the building permit is
issued for the improvement of the real
property involved, posts on the property
in a visible location adjacent to the
posted building permit and files in the
office of the Clerk of Superior Court in
each county wherein the real property to
be improved is located, a completed andsigned Notice of Contract form and the
second or third tier subcontractor fails
to serve upon the contractor a completed
and signed notice of subcontract form by
the same means of service as described in
G.S. 44A-19(d); or
b. After the posting and filing of a
signed Notice of Contract and the service
of a signed Notice of Subcontract, the
contractor serves upon the second or
third tier subcontractor, within five
days following each subsequent payment,
by the same means of service as described
in G.S. 44A-19(d), the written notice of
payment setting forth the date of payment
and the period for which payment is made
as requested in the Notice of Subcontract
form set forth herein.
Our Supreme Court has held, N.C.G.S. § 44A-23 provides
first-, second-, and third-tier subcontractors a separate right of
subrogation to the lien of the contractor who deals with the owner,
distinct from the rights contained in N.C.G.S. § 44A-18. Electric
Supply Co., 328 N.C. at 660, 403 S.E.2d at 297.
Therefore, even if the owner has specifically
paid the contractor for the labor or materials
supplied by the specific unpaid subcontractor
who is claiming the lien, that subcontractor
retains a right of subrogation, to the extent
of his claim, to whatever lien rights the
contractor otherwise has in the project.
Id. at 661, 403 S.E.2d at 297.
Plaintiff gave notice of claim of lien upon funds as provided
in N.C. Gen. Stat. § 44A-12 on 25 May 2005. Carmel failed to avail
itself of the protections afforded it as a general contractor under
N.C. Gen. Stat. § 44A-23(b). It is undisputed that Lowe's owes
Carmel $1,011,771.00 on its contract. Plaintiff has a right ofsubrogation to Carmel's lien to the extent of its claim.
Edwards, in her affidavit dated 31 July 2006, states, inter
9. From March, 2004 through January, 2005,
[plaintiff] sent invoices to Clark for a
total of $232,838.11 in rental charges
for leased equipment.
10. Clark paid [plaintiff] at least
$102,971.50 in rental charges for leased
11. Clark has no record of receiving 36
invoices from [plaintiff] that total
$180,991.48 of the amount [plaintiff]
claims is allegedly owed by Clark.
Plaintiff argues Clark's and Edwards's failure to answer and
respond to its claims and request for admissions, caused those
admissions to be deemed admitted, and bars consideration of her
affidavit. Edwards never admitted the full amount of plaintiff's
claims and her guaranty liability does not extend to the entire
amount of plaintiff's claims. Edwards's affidavit creates a
genuine issue of material fact on the amount plaintiff is owed on
its contract with Clark, and by extension, the amount of its lien
Summary judgment cannot be sustained based on a claim of lien
on property because a genuine issue of material fact exists on
whether an unpaid contract balance remains between Clark and
Reviewing the discovery responses of record, affidavits,
briefs, and arguments of counsel de novo, we find genuine issues of
material fact exist. Summary judgment cannot be sustained oneither statute. N.C. Gen. Stat. § 44A-18; N.C. Gen. Stat. § 44A-
23. The trial court erred when it found no genuine issues of
material fact exist and plaintiff is entitled to summary judgment
as a matter of law. The trial court's order of summary judgment is
reversed in part.
V. Western's Appeal
Western argues the trial court erred in entering summary
judgment against it because plaintiff's claim against it was unripe
and premature. Because we hold that genuine issues of material
fact exist, the trial court also erred when it entered summary
judgment against Western. That portion of the trial court's order
and judgment is also reversed.
Defendants' failure to petition this Court for a writ of
to review the trial court's denial of Carmel's motion to
stay or alternatively to dismiss plaintiff's state court action
constitute[d] a wavier of any error the judge may have committed
in denying the motion. N.C. Gen. Stat. § 1-75.12(c); Jaeger
N.C. App. at 173, 582 S.E.2d at 645. Defendants' assignment of
error to the trial court's ruling on this issue is dismissed.
Viewed in the light most favorable to defendants, proffered
evidence tends to show genuine issues of material fact exist
regarding whether an unpaid contract balance remains between Carmel
and Clark and whether an unpaid contract balance remains between
Clark and plaintiff.
Under de novo
review, we hold the trial court erred ingranting summary judgment in plaintiff's favor. The trial court's
order and judgment is reversed in part. This case is remanded for
Dismissed in Part, Reversed in Part, and Remanded.
Judge MCCULLOUGH concurs.
Chief Judge MARTIN concurs in part and dissents in part by
MARTIN, Chief Judge, concurring in part, dissenting in part.
I concur with the majority that the trial court erred by
improperly granting summary judgment in favor of plaintiff.
However, I would vote that this Court exercise its discretion to
hear the issue of the denial of defendant Carmel's motion to stay
or dismiss, and I would reverse the trial court's decision denying
the stay. Thus, I must respectfully dissent from that portion of
the majority opinion which dismisses defendants' assignment of
error directed to the trial court's denial of their motion for a
The majority correctly notes the governing statute, which
states: Whenever a motion for a stay . . . is denied, the movant
may seek review by means of a writ of certiorari and failure to do
so shall constitute a waiver of any error the judge may have
committed in denying the motion. N.C. Gen. Stat. § 1-75.12(c)
(2005). Although defendants have no right to appeal from the trial
court's failure to grant their motion to stay the action, Jaeger v.Applied Analytical Indus. Deutschland GMBH, 159 N.C. App. 167, 173,
582 S.E.2d 640, 645 (2003), this Court has the discretion to treat
defendants' assignment of error . . . as a petition for writ of
certiorari. Saxon v. Smith, 125 N.C. App. 163, 174, 479 S.E.2d
788, 795 (1997). This case is precisely the type of case in which
this Court should exercise its discretion to review the denial of
the motion to stay. In my view, for this Court to reverse the
grant of summary judgment without also considering whether the
motion to stay was properly denied, as the majority has done, is
illogical and inconsistent because the trial court will now be
required to hear the case in the absence of Clark, a necessary
party whose rights and obligations are at the very center of the
controversy. It thereby threatens to work substantial injustice to
plaintiff, defendants, and Clark.
In reversing the grant of summary judgment, the majority
correctly notes two genuine issues of material fact that should be
submitted to the factfinder: whether an unpaid contract balance
remains between [defendant] Carmel and Clark and whether an unpaid
contract balance remains between Clark and plaintiff. Both of
these issues clearly recognize that Clark is a necessary party to
the proceedings. Necessary parties are those persons who have
rights which must be ascertained and settled before the rights of
the parties to the suit can be determined. Equitable Life
Assurance Soc'y v. Basnight, 234 N.C. 347, 352, 67 S.E.2d 390, 395
(1951). Here, Clark has rights with respect to the amount it is
owed by defendant Carmel and the amount it owes to plaintiff, andthese rights must be determined before the suit between plaintiff
and defendants can be resolved.
Although originally a party, Clark's filing in bankruptcy
court operated as an automatic stay preventing other proceedings
against it pursuant to 11 U.S.C. § 362 (2005). Therefore, despite
Clark's joinder in the proceedings, in this case it was as if Clark
had not been joined because the action could not proceed against
Clark. This situation before us is directly analogous to a
situation where a necessary party cannot be joined. Thus, in
similar fashion, [w]here . . . a fatal defect of the parties is
disclosed, the court should refuse to deal with the merits of the
case until the absent parties are brought into the action . . . .
Booker v. Everhart, 294 N.C. 146, 158, 240 S.E.2d 360, 367 (1978).
Although the bankruptcy filing created a stay with respect only to
Clark and none of the other parties to the action, Clark's
inability to litigate in a forum other than bankruptcy court
affects the other parties whose claims depend on amounts owed to
and owing from Clark. Accordingly, the trial court should have
granted defendant Carmel's motion to stay adjudication of the claim
between plaintiff and defendants.
If there were no factual dispute as to the amounts owed
between the parties, then Rule 19(b) would allow the trial court to
decide the case in Clark's absence, and a stay would be
unnecessary. See N.C. Gen. Stat. § 1A-1, Rule 19(b) (2005).
However, as the majority has thoroughly discussed, summary judgment
was improperly granted because the amount owed by defendants toplaintiff raises genuine issues of material fact and depends on
amounts owed to and owing from Clark. These circumstances make the
denial of the stay unsupportable.
A trial court's denial of a motion to stay is subject to an
abuse of discretion standard of review. Home Indem. Co. v. Hoechst
Celanese Corp., 128 N.C. App. 113, 117, 493 S.E.2d 806, 809 (1997).
We should reverse a trial court and find an abuse of discretion .
. . 'only upon a showing that its ruling could not have been the
result of a reasoned decision.' State v. Campbell, 177 N.C. App.
520, 530, 629 S.E.2d 345, 351 (quoting State v. Burrus, 344 N.C.
79, 90, 472 S.E.2d 867, 875 (1996)), disc. review denied, 360 N.C.
578, 635 S.E.2d 902 (2006).
The trial court's authority to grant or deny the stay comes
from N.C.G.S. § 1-75.12, which provides for the grant of a stay
[i]f . . . the judge shall find that it would work substantial
injustice for the action to be tried in a court of this State.
N.C. Gen. Stat. § 1-75.12(a) (2005). To determine whether a stay
should be granted:
Relevant facts that may be considered include:
the nature of the case, the applicable law,
the convenience of witnesses, the availability
of process to compel the attendance of
witnesses, the ease of access to sources of
proof, the burden of litigating matters of
local concern in local courts, and other
practical considerations which would make the
trial easy, expeditious and inexpensive.
Home Indem. Co., 128 N.C. App. at 119, 493 S.E.2d at 810. Applying
these guidelines to the present case, it is clear that (1) Clark is
a necessary party that could not proceed in the action; (2)bankruptcy court was a more convenient forum because all parties
had already been joined in that action; and (3) hearing the action
in bankruptcy court would avoid duplication of litigation effort,
time, and costs by consolidating all issues into one trial,
resulting in one enforceable judgment.
Because there were genuine issues of material fact requiring
Clark's inclusion in the proceeding, it was unreasonable and an
abuse of discretion for the trial court to deny the stay. The
majority's fear that such a holding would set a dangerous
precedent is unfounded. The exercise of discretion requires only
that the court weigh the unique facts before it on a case-by-case
basis. United Servs. Auto. Ass'n v. Simpson, 126 N.C. App. 393,
400, 485 S.E.2d 337, 341, disc. review denied, 347 N.C. 141, 492
S.E.2d 37 (1997). In this case, for the reasons stated, a stay
should be granted, but such a holding here would not, as the
majority asserts, compel a stay to be entered in any pending
multi-party state action where only one party later files
Therefore, I would vote to reverse and remand the case to the
trial court with instructions to grant the stay until the issues
involving Clark are resolved in bankruptcy court, which will
necessarily resolve the issues of fact noted by the majority, or
until the bankruptcy stay is dissolved otherwise so that this
action may proceed with Clark as a necessary party.
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