Appeal by plaintiffs from orders entered 10 September 2007 and
22 October 2007 by Judge Lindsay R. Davis, Jr. in Guilford County
Superior Court. Heard in the Court of Appeals 7 October 2008.
Forman Rossabi Black, P.A., by Amiel J. Rossabi and Emily J.
Meister, for plaintiff-appellants.
Mary K. Nicholson for Andrew Cambron and Bay Point, LLC.
defendant-appellees
Richard M. Greene pro se.
BRYANT, Judge.
Plaintiffs Liam Wallis, individually and as representative
shareholder on behalf of Chartwell Homes, Inc., and Plantation
Property Management, LLC, (PPM) appeal from an order entered 10
September 2007, which granted in part defendants' Rule 12(b)(6)
motion to dismiss plaintiffs' claims, and from an order entered 22
October 2007, which denied plaintiffs' Rule 60 motion for relieffrom the order entered 10 September 2007. For the reasons stated
below, we dismiss plaintiffs' appeal in part and affirm in part.
The dispute between these parties arose from an agreement
between Defendant Andrew Cambron and Plaintiff Liam Wallis to enter
into a joint venture for the purpose of acquiring, developing, and
selling real estate. Cambron was an officer and shareholder of
Chartwell Homes, Inc. Plaintiffs alleged that pursuant to the
agreement Cambron was responsible for raising capital, soliciting
investors, and marketing, while Wallis was to be president and a
40% shareholder of Chartwell.
Later, Wallis alleged that Cambron refused to share internal
Chartwell documents, usurped corporate opportunities, and failed to
raise funds, bring in investors, and market properties to third
parties per their agreement. Therefore, in an effort to market
Chartwell properties, Wallis formed PPM but was unsuccessful as a
result of the alleged conduct of defendants Cambron and Richard
Greene.
In a complaint filed 18 September 2006 and amended 30 August
2007, plaintiffs raised twelve causes of action, including breach
of contract, derivative shareholder claims against Cambron and
Greene, the imposition of a trust, and a claim of civil conspiracy.
In their answer, defendants' asserted that plaintiffs failed to set
forth claims upon which relief could be granted which subjected the
complaint to dismissal under Rule 12(b)(6).
In an order entered 7 September 2007, the trial court granted
in part and denied in part defendants' motion to dismiss. Asgrounds for dismissal of plaintiffs' derivative shareholder claims,
the trial court concluded plaintiffs failed to satisfy the
shareholder demand requirement under N.C. Gen. Stat. § 55-7-42(a).
Furthermore, the trial court concluded “no action for 'civil
conspiracy' really exists in law” and dismissed that claim.
On 17 September 2007, plaintiffs filed a Motion For Relief
From Order pursuant to North Carolina Civil Procedure Rule 60.
Plaintiffs attached as “Exhibit A” a copy of the order entered 7
September 2007. On 17 October 2007, the trial court entered an
order denying plaintiffs' Rule 60 motion. On 7 November 2007,
plaintiffs filed a notice of appeal from both the 7 September 2007
order and the 17 October 2007 order.
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On appeal, plaintiffs raise four issues: whether, in its 7
September 2007 order, the trial court erred by (I) concluding that
the demand requirement under N.C. Gen. Stat. § 55-7-42(a) had not
been met and (II) concluding no action for civil conspiracy exists
under North Carolina law; whether the trial court erred by (III)
dismissing plaintiffs' claim for cancellation of a notice of lis
pendens filed by defendants; and (IV) denying plaintiffs' Rule 60
motion.
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I & II
Defendants argue that plaintiffs' appeal from the trial
court's order entered 7 September 2007 should be dismissed forfailure to timely file a notice of appeal pursuant to the North
Carolina Rules of Appellate Procedure, Rule 3(c). We agree.
Under our North Carolina Rules of Appellate Procedure, Rule
3(c), “Time for Taking Appeal,” states, in pertinent part, the
following:
In civil actions and special proceedings, a
party must file and serve a notice of appeal:
(1) within 30 days after entry of
judgment if the party has been served
with a copy of the judgment within the
three-day period prescribed by Rule 58 of
the Rules of Civil Procedure; or
(2) within 30 days after service upon the
party of a copy of the judgment if
service was not made within that
three-day period . . . .
N.C. R. App. P. 3(c) (2007). “The provisions of Rule 3 are
jurisdictional, and failure to follow the requirements thereof
requires dismissal of an appeal.”
Abels v. Renfro Corp., 126 N.C.
App. 800, 802, 486 S.E.2d 735, 737 (1997) (citation omitted).
Motions entered pursuant to Rule 60 do not toll the time for filing
a notice of appeal.
See N.C. R. App. P. 3(c) (2007).
On 7 September 2007, the trial court entered an order which
granted in part
(See footnote 1)
and denied in part defendants' motion to dismiss
plaintiffs' twelve causes of action. On 17 September 2007,plaintiffs filed a Rule 60 motion. In the motion, plaintiffs
incorporated as “Exhibit A” a copy of the order entered on and
bearing a file date stamp of 7 September 2007. On 17 October 2007,
the trial court entered an order denying plaintiffs' Rule 60
motion. On 7 November 2007, plaintiffs filed a notice of appeal
from both the 7 September 2007 order and the 17 October 2007 order.
While the record does not reflect when plaintiffs' were served
a copy of the trial court order, it is clear plaintiffs' were in
possession of the order as their Rule 60 Motion filed 17 September
2007 included a copy of the 7 September 2007 order. Plaintiffs
then appealed from the 7 September 2007 order on 7 November 2007 _
more than thirty days after the trial court order was filed, and
more than thirty days after plaintiffs filed the Rule 60 Motion.
Therefore, plaintiffs have failed to comply with appellate
procedure Rule 3(c).
As previously stated, “[t]he provisions of Rule 3 are
jurisdictional.”
Abels, 126 N.C. App. at 802, 486 S.E.2d at 737
(citation omitted). And, “[a] jurisdictional default . . .
precludes the appellate court from acting in any manner other than
to dismiss the appeal.”
Dogwood Dev. & Mgmt. Co., LLC v. White Oak
Transp. Co., 362 N.C. 191, 197, 657 S.E.2d 361, 365 (2008)
(citations omitted). Accordingly, plaintiffs' appeal from the
trial court order entered 7 September 2007 is dismissed.
III
Prior to oral argument the parties stipulated that issue (III)
had been resolved. Accordingly, the issue is no longer before us.
IV
Last, plaintiffs argue that the trial court erred in denying
plaintiffs' Rule 60 motion. Plaintiffs assert that the trial
court's 7 September 2007 order effectively precludes any
shareholder derivative claim and amounted to a misapplication of
the law where the trial court found that the shareholder demand
requirement under N.C. Gen. Stat. § 55-7-42(a) had not been met and
no action for civil conspiracy existed under North Carolina law.
Plaintiffs' argument is misplaced.
Our review of a trial court's ruling on a Rule 60(b) motion is
limited to a determination of whether the trial court abused its
discretion.
Barnes v. Wells, 165 N.C. App. 575, 580, 599 S.E.2d
585, 589 (2004). Therefore, a trial court's decision to grant or
deny relief pursuant to Rule 60(b) will not be overturned absent an
abuse of discretion.
Id.
Under North Carolina General Statutes section 1A-1, Rule 60,
On motion and upon such terms as are just, the
court may relieve a party or his legal
representative from a final judgment, order,
or proceeding for the following reasons:
(1) Mistake, inadvertence, surprise, or
excusable neglect;
. . .
(6) Any other reason justifying relief from
the operation of the judgment.
N.C. Gen. Stat. § 1A-1, Rule 60(b) (2008). “A 60(b) order does not
overrule a prior order but, consistent with statutory authority,
relieves parties from the effect of an order.”
Charns v. Brown,
129 N.C. App. 635, 639, 502 S.E.2d 7, 10 (1998) (citation omitted). However, “judgments involving misapplication of the law may be
corrected only by appeal and Rule 60(b) motions cannot be used as
a substitute for appeal.”
Spangler v. Olchowski, ___ N.C. App.
___, ___, 654 S.E.2d 507, 512 (2007) (citation omitted).
Accordingly, we hold the trial court did not err in denying
plaintiffs' Rule 60(b) motion.
Dismissed in part and affirmed in part.
Judges WYNN and ARROWOOD concur.
Footnote: 1