84 LUMBER COMPANY, L.P.,
Plaintiff
v
.
Wake County
No. 03 CVD 000691
HABITECH ENTERPRISES, INC. and
MEHDI K. DEHGHAN a/k/a
MEHDI K. DEHGAN a/k/a
MIKE DEHGHAN,
Defendants
Appeal by defendants from an order entered 29 September 2006
by Judge Shelley H. Desvousges in Wake County District Court.
Heard in the Court of Appeals 15 October 2007.
Smith Debnam Narron Wyche Saintsing & Myers, LLP, by Byron L.
Saintsing and Chad A. Sharkey, for plaintiff-appellee.
George B. Currin for defendants-appellants.
MARTIN, Chief Judge.
Habitech Enterprises, Inc. (Habitech) and Mehdi Dehghan
(Dehghan and collectively defendants) entered into an agreement
with 84 Lumber Company, L.P. (plaintiff) for the provision of
goods, building materials, and labor. On 17 January 2003 plaintiff
filed suit against defendants for breach of contract and breach of
personal guaranty, alleging that Habitech failed to pay $55,919.94
owed on the contract and that Dehghan was liable as guarantor.
Plaintiff moved for summary judgment, and the trial court granted
the motion on the issue of liability but denied the motion on the
issue of damages. On 11 March 2004 the parties entered into a Consent Judgment
in which plaintiff agreed to refrain from recording the judgment if
defendants agreed to pay plaintiff a sum of $65,000 over a
specified period of time. Defendants failed to make timely
payment, and on 30 March 2004 plaintiff moved to execute the
judgment against defendants. The execution was returned
unsatisfied by the Wake County Sheriff. Dehghan filed a Motion to
Claim Exempt Property, and plaintiff filed an objection to this
motion, claiming that Dehghan undervalued and omitted assets. The
trial court ordered modifications to the Motion to Claim Exempt
Property.
Plaintiff attempted to depose Dehghan in order to determine
his assets available to satisfy the judgment. Dehghan appeared but
refused to answer any questions. Plaintiff filed a Motion to
Compel Dehghan to appear for deposition and testify about his
property. This motion was denied. Plaintiff moved for an Order
for Supplemental Examination, requesting that Dehghan be ordered to
appear in court and answer questions about his property. The
motion was granted, and the trial court issued an Order for
Supplemental Examination. This order required Dehghan to appear at
a hearing to answer questions about his property and bring
documents detailing his assets to the hearing. It also forbade him
from transferring or disposing of any property.
Defendants argue that the Order for Supplemental Examination
must be vacated because it was unauthorized by law and exceeded
the authority of the trial court. Defendants contend that theorder should have been accompanied by an affidavit or other
competent evidence, and that the trial court lacked the authority
to order defendants to produce documents and refrain from
transferring or disposing of property.
Three statutes govern the issues on appeal. N.C.G.S. § 1-352
states that if a judgment is returned by the sheriff unsatisfied,
then:
[T]he judgment creditor at any time after the
return, and within three years from the time
of issuing the execution, is entitled to an
order from the court to which the execution is
returned or from the judge thereof, requiring
such debtor to appear and answer concerning
his property before such court or judge, at a
time and place specified in the order, within
the county to which the execution was issued.
N.C. Gen. Stat. § 1-352 (2005).
N.C.G.S. § 1-352.2 states:
[A]s an additional method of discovering
assets of a judgment debtor the clerk of the
court or a judge of the court in the county
wherein the original judgment is docketed, at
any time the judgment remains unsatisfied, and
within three years from the time of issuing an
execution, upon motion of the judgment
creditor showing good cause therefor, may:
(1) Order the judgment debtor, his agent or
anyone having possession or control of
property or records of or pertaining to the
judgment debtor, to produce and permit the
inspection and copying or photographing, by or
on behalf of the moving party, of any
designated documents, papers, books, accounts,
all tax records, letters, objects or tangible
things, not privileged, constituting property,
or being evidence of property, of the judgment
debtor and which are in his possession and
custody, or subject to his control[.]
N.C. Gen. Stat. § 1-352.2 (2005). Finally, N.C.G.S. § 1-358 states that in order to recover
assets from a judgment debtor [t]he court or judge may, by order,
forbid a transfer or other disposition of, or any interference
with, the property of the judgment debtor not exempt from
execution. N.C. Gen. Stat. § 1-358 (2005).
These statutes are discretionary in nature, and therefore, we
will not disturb the trial court's decision absent an abuse of
discretion. See State ex rel. Long v. Interstate Casualty Ins.
Co., 120 N.C. App. 743, 750, 464 S.E.2d 73, 77 (1995). The trial
court abuses its discretion when it makes a patently arbitrary
decision, manifestly unsupported by reason. Buford v. General
Motors Corp., 339 N.C. 396, 406, 451 S.E.2d 293, 298 (1994).
In the present case, ordering Dehghan to appear at a hearing
to answer questions about his property, to bring documents
detailing his assets to the hearing, and to refrain from
transferring or disposing of any property was clearly within the
trial court's authority granted by N.C.G.S. §§ 1-352, 1-352.2, and
1-358, respectively. Further, N.C.G.S. § 1-352 makes no mention of
any affidavit requirement that must be met before a trial court may
order a judgment debtor to appear in court to answer questions
about his property. Thus, the trial court did not abuse its
discretion in entering the Order for Supplemental Examination.
Affirmed.
Judges ELMORE and JACKSON concur.
Report per Rule 30(e).
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