Converted WP file 061438-1

Appeal by plaintiff from orders entered 13 March 2006 by Judge Anthony M. Brannon and 16 May and 17 May 2006 by Judge Frank R. Brown in Nash County Superior Court. Heard in the Court of Appeals 10 May 2007.

Braxton H. Bell for plaintiff.

Battle, Winslow, Scott & Wiley, P.A., by Marshall A. Gallop, Jr., for defendants.

    BRYANT, Judge.


    Greg Carpenter (plaintiff) appeals from orders entered 13 March, 16 May and 17 May 2006 dismissing a civil action against Sammy's Body Shop, Inc. and Sammy Kea (defendants). For the reasons stated herein, we affirm.
    On 26 July 2003 an automobile accident occurred involving plaintiff and William Scott Morris (Morris is not a party to this appeal). Following the accident, plaintiff took his vehicle to defendant Sammy's Body Shop for repairs. On 1 April 2004,plaintiff filed a complaint solely against Morris as a result of the accident.
    On 26 August 2004, plaintiff's counsel deposed defendant Sammy Kea, who was not at that time either a party to this case or represented by counsel. After taking defendant Kea's deposition, plaintiff filed an Amended Complaint in this action restating his theories of liability against Morris and adding defendants as parties under other theories of liability. Before serving an Answer to the Amended Complaint, defendants voluntarily appeared at a Mediated Settlement Conference held on 14 April 2005. Efforts to settle plaintiff's claims against defendants were unsuccessful; defendants were excused before the conclusion of the Mediated Settlement Conference which continued between plaintiff and Mr. Morris; and defendants thereafter served their Answer the next day on 15 April 2005. Counsel for defendants wrote a letter dated 26 April 2005 to the Senior Resident Superior Court Judge based on his knowledge of the Mediated Settlement Conference. The letter confirmed defendants' voluntary attendance at the Mediated Settlement Conference at the suggestion of plaintiff's counsel. The letter also requested a continuance of the trial of the case which had been set for 16 May 2005. On 27 April 2005, without the knowledge of defendants or their counsel, plaintiff executed what purported to be a “General Release.” On 29 April 2005, plaintiff filed a Voluntary Dismissal With Prejudice as to Morris with the trial court, also dated 27 April 2005. The case was reset for trial during the week of 17 October 2005.     On 31 August 2005 counsel for defendants served plaintiff with a “Request for Production of Documents and Things” which specifically requested “Any settlement agreement, release or other similar document executed by and between you and William Scott Morris, his attorney or insurance carrier.” On 19 September 2005 plaintiff served a response which included the “General Release” executed on 27 April 2005. Upon receiving the “General Release” executed by plaintiff, counsel for defendants immediately served a Motion to Supplement Pleadings along with a proposed Supplemental Answer (seeking to plead the General Release as a defense) including a Motion for Judgment on the Pleadings (based on that defense) on 21 September 2005, in addition to a Notice of Hearing. Defendants' motions were granted by order of Judge Brannon entered on 21 October 2005. The order was served by first-class mail on plaintiff on 25 October 2005. On 7 November 2005, seventeen days after the Order and Judgment were filed with the clerk of court, plaintiff served his Rule 59 Motion to Reconsider the Order and Judgment of Judge Brannon entered on 21 October 2005 by first-class mail.
    On 20 December 2005 Judge Brannon heard and denied plaintiff's Rule 59 Motion. A written Order was filed by the trial court on 13 March 2006 and served by first-class mail on 14 March 2006. In ruling on the Rule 59 Motion, Judge Brannon considered it “both as to the timeliness of the Motion and as to the merits of the Motion.”     On 6 April 2006 plaintiff filed a Notice of Appeal with this Court from the 21 October 2005 and the 13 March 2006 Orders signed by Judge Brannon. On 26 April 2006 defendants served their Verified Motion to Dismiss Appeal pursuant to Rules 3(c) and 25(a) of the North Carolina Rules of Appellate Procedure along with a Notice of Hearing setting the Motion for Hearing on 15 May 2006. Plaintiff filed a Rule 60 Motion to be heard in the event his appeal from the original Order and Judgment entered 21 October 2005 was dismissed. Defendants' Verified Motion to Dismiss the Appeal was allowed and the written order was filed on 16 May 2006. Plaintiff's Rule 60 Motion was subsequently denied and the written order was filed on 17 May 2006. Each Order was served on plaintiff on 18 May 2006. Plaintiff appeals.

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Plaintiff contends the trial court erred by: (I) dismissing defendants Sammy Kea and Sammy's Body Shop, Inc. from his civil action based on the execution of his General Release; (II) denying plaintiff's motion to reconsider and dismissing plaintiff's appeal for untimely filing; and (III) denying plaintiff's Rule 60(b) motion for relief from judgment.

    Plaintiff argues the trial court erred by dismissing defendants Sammy Kea and Sammy's Body Shop, Inc. from his civil action based on the execution of the General Release. We disagree.     Mediated settlement agreements are governed by general principles of contract law. Chappell v. Roth, 353 N.C. 690, 692,548 S.E.2d 499, 500 (2001) (citing McNair v. Goodwin, 262 N.C. 1, 7, 136 S.E.2d 218, 223 (1964)). “Under our law a comprehensively phrased 'general release,' in the absence of proof of a contrary intent, is usually held to discharge all and sundry claims between the parties.” McGladrey, Hendrickson & Pullen v. Syntek Finance Corp., 92 N.C. App. 708, 710-11, 375 S.E.2d 689, 691, disc. rev. denied, 324 N.C. 433, 379 S.E.2d 243 (1989) (citation omitted).
    The “General Release” at issue here executed on 27 April 2005 specifically states, in pertinent part:
        The undersigned, Greg Carpenter, for the sole consideration of FIVE THOUSAND AND N0/100 DOLLARS ($5,000.00) paid to them, the receipt and sufficiency of which is hereby acknowledged, do hereby release and forever discharge William Scott Morris and The Travelers Indemnity Company and their agents and servants, representatives, successors, employees, officers, and all other persons, firms, associations, and corporations of and from any and all past, present and future actions, claims and demands, damages, expenses, costs, attorneys' fees and all claims of any nature or kind whatsoever now existing or which may hereafter arise out of the alleged motor vehicle accident, said to have occurred on July 26, 2003 on or around Interstate 40 near Burlington, Alamance County, North Carolina including any consequences thereof now existing or which may develop, whether or not such consequences are known or anticipated, as more particularly described in a lawsuit instituted in Nash County Civil Superior Court, styled Greg Carpenter v. William Scott Morris, Sammy's Bodv Shop, Inc., and Sammy Kea, and bearing Civil Action Number 04-CVS-575.

(Emphasis added). See Battle v. Clanton, 27 N.C. App. 616, 220 S.E.2d 97 (1975), disc. rev. denied, 289 N.C. 613, 223 S.E.2d 391 (1976) (summary judgment affirmed where similar language in ageneral release [“all claims of whatever kind or character”] released a codefendant who was not a party to the settlement).
    It is undisputed that the Memorandum of Mediated Settlement Agreement indicates in handwriting that “claims against Sammy's Body Shop and Sammy Kea expressly not settled.” In addition, on the Report of Mediator, the unsigned form indicates that plaintiff is taking a “voluntary dismissal with prejudice” and has inserted language stating “as to one defendant, not all.” However, both of those documents were generated almost two weeks prior to the execution of the General Release upon which defendants relied after becoming aware of its existence and its language. Plaintiff's counsel knew nearly a month prior to the 17 October 2005 hearing of defendants' intended defense based upon the General Release. However, plaintiff's counsel did not present anything at the hearing to indicate the language of the General Release, on its face, was not intended to release all potential parties, including defendants.
    In Sword v. Dep't of Transp., 121 N.C. App. 213, 464 S.E.2d 715 (1995), disc. rev. denied, 342 N.C. 664, 467 S.E.2d 734 (1996), the plaintiff was injured while a passenger in an automobile which slid out of control into the path of a vehicle in the oncoming lane of traffic. The plaintiff settled with the driver of the vehicle in which she was riding and thereafter sought to pursue a claim against the Department of Transportation for alleged negligent design, maintenance and failure to warn regarding the highway. This Court stated:        The issue presented by the instant action is whether a general release which contains the language “all other firms, persons, corporations, associations or partnerships” releases [] the State of North Carolina even though the State is not specifically named in the release. . . . Thus, the Commission did not err in holding that the North Carolina Department of Transportation was released in the general release from any claim by plaintiff. Therefore the Decision and Order is affirmed.

Id. at 214-15, 464 S.E.2d at 715-16.
    Here, the trial court dismissed plaintiff's claims against Sammy Kea and Sammy's Body Shop based on the same interpretation in Sword:
        THE COURT: If the General Release were to have any - - where it says Alamance County, North Carolina, had it ended with a period there instead of a comma, we would have a trial starting this afternoon. I would deny the Motion to Dismiss because clearly, the current claim is a matter of contract or arises out of a contract. Whereas, all the other folks involved, in that - - in the lawsuit arose as a result of an automobile accident in Alamance County. But when the period after North Carolina, good draftsmanship, was turned into a comma, and then including the language “including any consequences thereof now existing or which may develop whether or not such consequences are known or anticipated and more particularly described in a lawsuit instituted in Nash County Civil Superior Court, North Carolina, styled Greg Carpenter v. William Scott Morris, Sammy's Body Shop, Inc., and Sammy Kea, and bearing Civil Action Number 04-CVS-575,” which of course, is the case before me today. That most particularizing detailed language makes me somewhat - - under reluctant and firm opinion but under the North Carolina case law this General Release covers all that too.

Three weeks after the trial court's 17 October 2005 ruling, plaintiff alleged a reformation of the General Release. Notably,all supporting evidence (affidavits and the “Revised General Release”   (See footnote 1) ) was created after the entry of the Order and Judgment dismissing plaintiff's action against defendants. This assignment of error is overruled.

    Plaintiff argues the trial court erred by denying plaintiff's motion to reconsider and dismissing plaintiff's appeal for untimely filing. We disagree.
    The trial court's order was “entered” on Friday, 21 October 2005 and was to be served on all parties “within three days after the Judgment is entered.” N.C. Gen. Stat. § 1A-1, Rule 58 (2005). The order and judgment was timely served on plaintiff on Tuesday, 25 October 2005 (i.e. within 3 days of “entry” since 22 October 2005 was a Saturday and 23 October 2005 was a Sunday). N.C.G.S. § 1A-1, Rule 6(a) and Rule 58 (2005). Because service was completed by first-class mail, “three days shall be added to the time periods described by . . . Rule 59.” N.C.G.S. § 1A-1, Rule 58 (2005).
    Rule 59(b) states “[a] motion for a re-trial shall be served not later than 10 days after entry of the judgment.” N.C. Gen. Stat. § 1A-1, Rule 59(b) (2005). Similarly, Rule 59(e) states “[a] motion to alter or amend the judgment under section (a) of this rule shall be served not later than 10 days after entry of thejudgment.” N.C.G.S. § 1A-1, Rule 59(e) (2005). Rule 58 specifies that the judgment should be served within three days of entry, which is a “period prescribed less than seven days,” and Rule 6(a) mandates that in determining the three day period, intermediate Saturdays and Sundays shall be excluded. On these undisputed facts, and the clear provisions of Rules 6(a), 58 and 59 of the Rules of Civil Procedure, the deadline is related solely to the date of entry of the judgment.
    Similarly, North Carolina Rules of Appellate Procedure, Rule 3(c), in pertinent part, clearly states:
        a party must file and serve a notice of appeal: Within 30 days after entry of judgment if the party has been served with a copy of the judgment within the 3-day period prescribed by Rule 58 of the Rules of Civil Procedure; or . . . if a timely motion is made by any party for relief under Rule[] . . . 59 of the Rules of Civil Procedure, the 30-day period for taking appeal is tolled as to all parties until entry of an order disposing of the motion and then runs as to each party from the date of entry of the order or its untimely service upon the party, as provided in subsections (1) and (2) of this subdivision (c). In computing the time for filing a notice of appeal, the provision for additional time after service by mail of N.C.R. App. P. 27(b) and N.C.R. Civ. P. 6(e) shall not apply.

N.C. R. App. P., Rule 3(c). Therefore, on the undisputed facts of this case and the applicable rules, plaintiff had thirteen days (ten days under Rule 59 plus three additional days pursuant to Rule 58 due to service of the Order and Judgment by first-class mail) from entry of the order on 21 October 2005 within which to serve a timely motion pursuant to Rule 59. Counting those days in the manner provided by Rule 6(a), 21 October 2005 is not counted sothat the first of the thirteen days would be 22 October (this is counted under Rule 6 since the period in question is not “less than seven days”). The last day is counted if it is not “Saturday, Sunday, or a legal holiday when the Courthouse is closed for transactions” such that the tenth day from entry of the trial court's order fell on Monday, 31 October 2005, which was not a “Saturday, Sunday or legal holiday” and the thirteenth day after entry of the order was Thursday, 3 November 2005 (which was not a “Saturday, Sunday or legal holiday”). Therefore, for plaintiff's Rule 59 Motion to Reconsider to have been timely, it should have been served no later than Thursday, 3 November 2005. However, because service of plaintiff's motion was clearly untimely (on Monday, 7 November 2005), the time for filing plaintiff's Notice of Appeal had not tolled. In this case, it is undisputed that the Notice of Appeal with respect to the trial court's 21 October 2005 order was neither served nor filed until 6 April 2006, well beyond the thirty days from entry of judgment allowed by N.C. R. App. P. 3. Because that thirty-day period to file the Notice of Appeal was not tolled by a timely Rule 59 Motion, plaintiff's appeal was properly dismissed by the trial court's order entered 16 May 2006. This assignment of error is overruled.

III

    Plaintiff argues the trial court erred by denying plaintiff's Rule 60(b) motion for relief from judgment. When reviewing a trial court's discretion under Rule 60(b)(6), “our Supreme Court has indicated that this Court cannot substitute 'what it considers tobe its own better judgment' for a discretionary ruling of a trial court, and that this Court should not disturb a discretionary ruling unless it 'probably amounted to a substantial miscarriage of justice.'” State ex rel. Envir. Mgmt. Comm. v. House of Raeford Farms, 101 N.C. App. 433, 448, 400 S.E.2d 107, 117 (1991), reversed on other grounds, 338 N.C. 262, 449 S.E.2d 453 (1994) (quoting Worthington v. Bynum, 305 N.C. 478, 486-87, 290 S.E.2d 599, 604-05 (1982)); see N.C. Gen. Stat. § 1A-1, Rule 60 (2005). Accordingly, when considering an appeal of a Rule 60(b) motion, “appellate review is limited to determining whether the court abused its discretion.” Sink v. Easter, 288 N.C. 183, 198, 217 S.E.2d 532, 541 (1975). An abuse of discretion is where the ruling of the trial court is manifestly unsupported by reason or is so arbitrary that it could not have been the result of a reasoned decision. Blackmon v. Bumgardner, 135 N.C. App. 125, 130, 519 S.E.2d 335, 338 (1999).
    Here, plaintiff knew at least three full weeks prior to the 17 October 2005 hearing that defendants intended to raise the General Release as a defense. However, plaintiff did not seek a reformation of the release (although he was able to obtain a “Revised General Release” along with affidavits). The release dated 27 April 2005 was a valid contract at the time of execution; at the time of the 17 October 2005 hearing; and as of the 21 October 2005 date of entry of the Order and Judgment. In its 17 May 2006 order, the trial court fully considered plaintiff's arguments under Rule 60 and, in the exercise of its discretion,rejected those arguments and denied plaintiff's motion. The trial court specifically found and concluded that “there is no 'other reason justifying relief' as contemplated by Rule 60(b)(6); and in particular there are no extraordinary circumstances, nor a showing that justice demands relief.” The trial court's ruling was neither “manifestly unsupported by reason” nor “so arbitrary that it could not have been the result of a reasoned decision.” This assignment of error is overruled.
    Affirmed.
    Judges MCCULLOUGH and STROUD concur.
    Report per Rule 30(e).

Footnote: 1