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An unpublished opinion of the North Carolina Court of Appeals does not constitute controlling legal authority. Citation is disfavored, but may be permitted in accordance with the provisions of Rule 30(e)(3) of the North Carolina Rules of Appellate Procedure.
NORTH CAROLINA COURT OF APPEALS
Filed: 16 September 2008
MELTON-RIDDLE FUNERAL HOME,
RONNIE AUSTIN RIDDLE,
No. 07 CVS 1888
NORTH CAROLINA BOARD
OF FUNERAL SERVICE,
Appeal by Petitioners from judgment entered 15 November 2007
by Judge Kenneth C. Titus in Wake County Superior Court. Heard in
the Court of Appeals 27 August 2008.
Young Moore and Henderson P.A., by John N. Fountain and Reed
N. Fountain, for Petitioners-Appellants.
Allen and Pinnix, P.A., by M. Jackson Nichols and Anna Baird
Choi, for Respondent-Appellee.
Petitioners appeal from an order granting in part and denying
in part their motion for judicial review of a decision by the
Board. We affirm.
Petitioners are Melton-Riddle Funeral Home, a funeral home in
Sylva, North Carolina, and Ronnie Riddle, its manager and
president. Respondent is the North Carolina Board of Funeral
Service (the Board), a state agency that regulates funeral
services. The present appeal arises from the Board's revocation of
certain licenses held by Petitioners. Riddle previously held apreneed sales license and a funeral director's license. Melton-
Riddle previously was licensed as a funeral establishment and as a
preneed establishement. N.C. Gen. Stat. § 90-210.60(8) (2007)
defines preneed funeral planning in pertinent part as offering to
sell or selling preneed funeral contracts, or making other
arrangements prior to death[.]
In March 2006 Petitioners and Respondent entered into a
Consent Order in which Petitioners admitted to violation of the
statutes governing funeral services as well as violation of the
Board's laws and rules. The Board revoked Melton-Riddle's funeral
establishment and preneed establishment licenses, and revoked
Riddle's funeral director and preneed sales licenses. Under the
terms of the Consent Order, the Board stayed the revocations and
placed Petitioners' licenses on probation for a period of three
years for Petitioners' preneed licenses and one year for
Petitioners' at-need licenses. As a condition of probation,
Petitioners agreed that if the Board received evidence that
Petitioners had violated the Board's rules during the terms of
probation, it would hold a show cause hearing. If the Board
determined at the hearing that Petitioners had violated its rules,
the Board might lift the stay [of revocation] or impose such
disciplinary action as it determines is appropriate and is
authorized by law.
In September 2006, the Board notified Petitioners that a show
cause hearing was scheduled for 26 September 2006 to determine
whether Petitioners had violated the Board's rules. On 26September the hearing was continued until 15 November 2006, when it
was continued again until 14 December 2006. The Board conducted a
hearing on 14 December 2006, at which Petitioners did not appear.
Following the hearing, the Board filed a final agency decision
revoking Riddle's preneed sales license and funeral director's
license; revoking Melton-Riddle's preneed establishment license;
and extending the period of probation of Melton-Riddle's funeral
On 5 February 2007 Petitioners filed a petition for judicial
review of the Board's decision, and a motion for a stay of the
decision and for remand to the Board for additional evidence.
Petitioners alleged that the Board had violated their statutory and
constitutional rights, on the grounds that Petitioners did not
receive notice of the December 2006 hearing. They asked the trial
court to reverse and remand the Board's decision and to stay its
execution. On 15 November 2007 the trial court entered an order
finding in pertinent part that:
2. The Affidavit of [the Board's counsel]
indicates that the Board served:
(a) the Notice of Hearing for the September
26, 2006 Show Cause Hearing by personal
service and certified mail;
(b) the Notice of Hearing for the November 15,
2006 Show Cause Hearing by certified mail;
(c) the Notice of Hearing for the December 14,
2006 Show Cause Hearing by certified mail; and
3. In his Affidavit, Ronnie Riddle . . . denied
receipt of notice of the date of the December
Show Cause Hearing.
4. The Petitioners produced numerous affidavits
denying receipt or signature of the November
27, 2006 Certified Mail Receipt with respectto the date of a December Show Cause
5. The signature 'T. Riddle' on the November 27,
2006, Certified Mail Receipt is different from
the signature of 'Thomasine Riddle' on the
October 26, 2006 [receipt].
6. The Court finds, consistent with G.S. §
150B-51(b), that the substantial rights of
Petitioners may have been prejudiced inasmuch
as the Petitioners may not have had notice of
the date of the hearing before the Board.
7. By reason of the foregoing, the Order of the
Board is affected by other error of law
pursuant to G.S. § 150B-51(b)(4).
On the basis of its findings the court entered the following order:
[I]t is hereby Ordered . . . that this matter
be remanded to the Board solely on the basis
that the signature 'T. Riddle' on the November
27, 2006, Certified Mail Receipt is different
from 'Thomasine Riddle.' It is further
ordered that the Board's Final Agency Decision
is stayed pending issuance of another Final
Agency Decision, except that the portion of
the Board's Final Agency Decision regarding
revocation of the preneed establishment
license of Melton-Riddle Funeral Home and the
individual preneed sales license of Ronnie
Riddle is not stayed and both the funeral home
and Mr. Riddle. Mr. Riddle shall not be
authorized to engage in any presales
activities until further order by the Board.
From this order, Petitioners have appealed.
Standard of Review
N.C. Gen. Stat. § 150B-51 (2007), which governs a trial
court's judicial review of a final agency decision, provides in
relevant part that:
(b) . . . [I]n reviewing a final decision, the
court may affirm the decision of the agency or
remand the case to the agency . . . for
further proceedings. It may also reverse or
modify the agency's decision . . . if thesubstantial rights of the petitioners may have
been prejudiced because the agency's findings,
inferences, conclusions, or decisions are:
(1) In violation of constitutional provisions;
(2) In excess of the statutory authority or
jurisdiction of the agency;
(3) Made upon unlawful procedure;
(4) Affected by other error of law;
(5) Unsupported by substantial evidence
admissible under G.S. 150B-29(a), 150B-30, or
150B-31 in view of the entire record as
(6) Arbitrary, capricious, or an abuse of
On appeal, the scope of review to be applied by the appellate
court under this section is the same as it is for other civil
cases. N.C. Gen. Stat. § 150B-52 (2007). In cases appealed from
administrative tribunals, we review questions of law de novo and
questions of fact under the whole record test. Diaz v. Division
of Soc. Servs., 360 N.C. 384, 386, 628 S.E.2d 1, 2 (2006) (citing
N.C. Dep't of Env't & Natural Res. v. Carroll, 358 N.C. 649, 659,
599 S.E.2d 888, 894-95 (2004)).
Petitioners argue first that the trial court erred by staying
only a portion of the Board's final decision. The trial court
found that Petitioners might not have received notice of the
hearing and remanded the matter to the Board. Petitioners argue
that, upon remanding the case to the board, the court could not
properly fail to stay the revocation of the pre-need establishment
license or the individual pre-need sales license of the
Appellants. We disagree. N.C. Gen. Stat. § 150B-38(b) (2007), provides in pertinent
part that [p]rior to any agency action in a contested case, the
agency shall give the parties in the case an opportunity for a
hearing without undue delay and notice not less than 15 days before
the hearing. Petitioners sought reversal of the Board's final
decision on the grounds that they did not have the statutorily
required notice of the hearing. They submitted affidavits tending
to show that they did not receive notice of the 14 December 2006
show cause hearing. The Board offered evidence tending to show
that notice was properly given. Consequently, the trial court was
presented with conflicting evidence on this issue.
It is for the agency, not a reviewing court, 'to determine
the weight and sufficiency of the evidence and the credibility of
the witnesses, to draw inferences from the facts, and to appraise
conflicting and circumstantial evidence[,] if any.' . . .
Ordinarily, when an agency fails to make a material finding of fact
or resolve a material conflict in the evidence, the case must be
remanded to the agency for a proper finding. N.C. Dep't of Env't
& Natural Res., 358 N.C. at 674, 599 S.E.2d at 904 (quoting State
ex rel. Utils. Comm'n v. Duke Power Co., 305 N.C. 1, 21, 287 S.E.2d
786, 798 (1982)) (citation omitted). We conclude that the trial
court properly remanded to the Board.
Petitioners argue that, by not staying the Board's revocation
of Petitioners' preneed licenses, the trial court was enforcing an
invalid order. This incorrectly construes the proceedings. The
trial court did not find as a fact that Petitioners did not havenotice of the hearing or declare the Board's decision to be
invalid. Rather, the trial court found that because Petitioners
may not have received notice their rights may have been violated.
Thus, Petitioner's statement that the trial court enforce[d] a
portion of the invalid order is an inaccurate characterization of
the court's decision to stay only part of the Board's decision.
The validity of the Board's decision will be determined by the
Board on remand.
Moreover, Petitioners fail to address the proper standard of
review of a court's decision to issue or deny a stay. N.C. Gen.
Stat. § 150B-48 (2007), which addresses issuance of a stay of an
agency decision, provides that:
At any time before or during the review
proceeding, the person aggrieved may apply to
the reviewing court for an order staying the
operation of the administrative decision
pending the outcome of the review. The court
may grant or deny the stay in its discretion
upon such terms as it deems proper and subject
to the provisions of G.S. 1A-1, Rule 65.
The statute places the decision to grant or deny a request for a
stay in the court's discretion. Discretionary decisions of the
trial court are reviewed for abuse of discretion. See, e.g.,
American Motors Sales Corp. v. Peters, 58 N.C. App. 684, 294 S.E.2d
764 (1982), rev'd in part on other grounds, 311 N.C. 311, 317
S.E.2d 351 (1984) (finding no abuse of discretion in trial court's
decision under former N.C. Gen. Stat. § 150A-48 (identical to
present N.C. Gen. Stat. § 150B-48) to deny Petitioner's motion for
a stay of an agency decision). Petitioners neither discuss the abuse of discretion standard
nor argue that the trial court abused its discretion in failing to
stay all parts of the Board's decision pending its issuance of a
new final agency decision. Nor do Petitioners cite any authority
for their assertion that, upon finding that there was a possibility
of error, the trial court was then required to stay all parts of
the agency decision. We conclude that the court did not err or
abuse its discretion either by remanding to the Board or by not
staying the revocation of Petitioners' preneed licenses. This
assignment of error is overruled.
Petitioners argue next that the trial court erred by staying
any of the Board's decision. Petitioners contend that (1) the stay
was entered under N.C. Gen. Stat. § 150B-52 (2007); (2) the trial
court lacks authority to enter a stay under G.S. § 150B-52 in the
absence of a request by the appellants to do so; and (3) they never
requested a stay. On this basis, Petitioners assert that the trial
court erred by entering even a partial stay. We disagree.
Petitioners' underlying premise, that the trial court entered
a stay under G.S. § 150B-52, is inaccurate. N.C. Gen. Stat. §
150B-52 allows an appealing party to request a stay of the order in
question pending appeal to this Court. However, the trial court's
order was entered before Petitioners appealed. In its order, the
trial court states that its review was conducted pursuant to G.S.
§ 150B-48, which authorizes the court to grant or deny a request
for a stay. In the instant case, Petitioners clearly requested astay. Petitioners' motion sought a stay of the Board's decision.
They also submitted Riddle's affidavit averring that a stay was
needed to protect Petitioners' financial interests.
Because there is no indication that G.S. § 150B-52, was the
basis of the court's ruling, we find it unnecessary to consider the
scope of the statute. Further, Petitioners do not allege any
prejudice from the entry of a partial stay and we find none,
particularly in view of their argument that the court erred by not
staying the entire decision. This assignment of error is
Finally, Petitioners argue that the trial court erred by
failing to make the findings required under N.C. Gen. Stat. § 1A-
1, Rule 65 for a grant of injunctive relief. Petitioners did not
apply for an injunction; nor did the trial court enter an
injunction. Petitioners offer no support for grafting the
requirements of N.C. Gen. Stat. § 1A-1, Rule 65 (2007) onto G.S. §
150B-48. This assignment of error is overruled.
Respondent's Cross-Assignment of Error
Respondent asserts as a cross-assignment of error that the
evidence of Record before the Board indicated [that Petitioners]
received proper notice of all three Show Cause hearings. We
conclude that this issue is not properly before us.
Cross-assignments of error are governed by N.C.R. App. P.
10(d), which states in pertinent part that:
Without taking an appeal an appellee may
cross-assign as error any action or omissionof the trial court which was properly
preserved for appellate review and which
deprived the appellee of an alternative basis
in law for supporting the judgment . . . from
which appeal has been taken. . . .
Rule 10(d) sets out two requirements for a valid cross-assignment
of error: (1) that the issue raised constitute an alternative
basis in law for supporting the judgment; and (2) that the
appellee cross-assign as error the issue raised. We conclude
that Respondent has not met either of these requirements.
Respondent failed to file any cross-assignments of error, and
thus did not cross-assign error to the trial court's ruling on the
sufficiency of Petitioners' notice of the show cause hearings.
Therefore, Respondent has not preserved this issue for appellate
review. See, e.g., Harllee v. Harllee
, 151 N.C. App. 40, 51, 565
S.E.2d 678, 685 (2002) (In the instant case, the additional
arguments raised in plaintiff-appellee's brief, if sustained, would
provide an alternative basis for upholding the trial court's
determination[.] . . . However, plaintiff failed to cross-assign
error pursuant to Rule 10(d) to the trial court's failure to render
judgment on these alternative grounds. Therefore, plaintiff has
not properly preserved for appellate review these alternative
Moreover, the issue that Respondent attempts to raise is not
appropriate for a cross-assignment of error. The trial court ruled
that Petitioners might not have received notice, and remanded for
the Board's determination of this issue. Respondent does not
present an alternative basis for remand, but argues that instead
ofremanding the case, the trial court should have ruled that
Petitioners had sufficient notice. Because plaintiff's
cross-assignment of error does not present an alternative basis
upon which to support the judgment, the question argued therein is
not properly before this court. The proper method to have preserved
this issue for review would have been a cross-appeal. Plaintiff's
cross-assignment of error is overruled. Stanback v. Westchester
Fire Ins. Co
., 68 N.C. App. 107, 117, 314 S.E.2d 775, 781 (1984).
For the reasons discussed above, we conclude that the trial
court did not err and that its order should be
Judges McGEE and BRYANT concur.
Report per Rule 30(e).
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