JAMES W. LITTLE and wife, PAMELA F. LITTLE, Plaintiffs v. BARSON
FINANCIAL SERVICES CORPORATION, RODNEY HAIRSTON, BALDWIN-SHA KUR
& ASSOCIATES, CLARKE W. BALDWIN and wife, KIMBERLY A. AKBAR,
FARID SHA KUR, CALVIN BRICE and wife, FAYE Y. BRICE, Defendants
No. COA99-944
(Filed 5 July 2000)
Judgments--default--entry set aside for remaining defendants
The trial court erred by extending the default judgment it entered for the non-responding
defendants to the remaining defendants in an action to quiet title to plaintiff’s property because:
(1) a default judgment against the non-responding defendants did not make any admissions on
behalf of the remaining defendants, bar any of their defenses or claims, or prejudice their rights;
and (2) the remaining defendants should have been allowed the opportunity to present their
defense to plaintiffs’ action to quiet title, and to present their counterclaim to quiet title.
Appeal by defendants Calvin and Faye Y. Brice from an order
and judgment entered 12 March 1999 by Judge William H. Freeman in
Forsyth County Superior Court.
Heard in the Court of Appeals 11
May 2000.
Metcalf & Beal, L.L.P., by W. Eugene Metcalf, for plaintiffappellees.
Adams Kleemeier Hagan Hannah & Fouts, P.L.L.C., by David S.
Pokela, for defendant-appellants Calvin and Faye Y. Brice.
HUNTER, Judge.
Defendants
Calvin
Brice
and
Faye
Y.
Brice
(“defendant-
appellants”) appeal a judgment by the trial court wherein it
granted a default judgment against defendants Clarke W. Baldwin,
Kimberly A. Akbar, and Farid Sha Kur on claims that they falsely
obtained the property of James W. Little and Pamela F. Little
(“plaintiffs”).
The trial court did not adjudicate defendant-
appellants’ claims to the property, but proceeded to grant sole
lawful ownership of the property to plaintiffs.
We reverse,
holding that a default judgment as to some, but not all defendants,
did not clear title to the property in plaintiffs’ favor.
Briefly,
the
record
indicates
that
plaintiffs
filed
the
complaint in the present case alleging that Baldwin, Akbar, and Sha
Kur had fraudulently obtained their property located at 2934
Poinsettia Drive in Winston-Salem, and asked that the court quiet
title in their favor.
subject
property
counterclaimed
Apparently, a subsequent conveyance of the
had
and
been
made
to
crossclaimed,
defendant-appellants,
alleging
that
even
if
who
the
plaintiffs had been defrauded by the other defendants, defendantappellants were innocent bona fide purchasers for value, and were
the rightful owners because plaintiffs failed to comply with their
duty
to
read
the
documents
property to Baldwin and Akbar.
in
which
plaintiffs
conveyed
the
Baldwin, Akbar, and Sha Kur failed
to answer and the trial court entered a default judgment against
them, wherein it quieted title to the property, ordering that
plaintiffs were the property’s sole owners without hearing the
counterclaims and crossclaims of defendant-appellants.
Defendant-appellants first contend that the trial court erred
because
after
entering
a
default
judgment
against
defendants
Baldwin, Akbar, and Sha Kur, it extended the default judgment to
them, ruling that defendant-appellants were bound by the facts
deemed admitted by the default of the non-responding defendants.
Defendant-appellants argue that they did not default, and were
never given the opportunity to be heard on their defense to
plaintiff’s quiet title action or their own counterclaim to quiet
title.
They contend the trial court erred in quieting title to the
property based only on a default judgment against some of the
defendants.
This Court has held that an action to remove a cloud on title:
“[M]ay be brought by any person against
another who claims an estate or interest in
real property adverse to him for the purpose
of determining such adverse claims . . . , and
a decree for the plaintiff shall debar all
claims of the defendant in the property of the
plaintiff
then
owned
or
afterwards
acquired. . . .”
N.C. Gen. Stat. § 41-10 (1996). In order to
establish a prima facie case for removing a
cloud on title, a plaintiff must meet two
requirements: (1) plaintiff must own the land
in controversy, or have some estate or
interest in it; and (2) defendant must assert
some claim in the land which is adverse to
plaintiff’s title, estate or interest. Wells
v. Clayton, 236 N.C. 102, 107, 72 S.E.2d 16,
20 (1952).
By bringing a suit pursuant to
this statute, a plaintiff is not demanding
possession of the land but is merely stating
that defendant has no right, title or interest
adverse to his interest.
Development Co.,
Inc. v. Phillips, 278 N.C. 69, 77, 178 S.E.2d
813, 818 (1971). . . .
Further, once a
plaintiff establishes a prima facie case for
removing a cloud on title, the burden rests
upon the defendant to establish that his title
to the property defeats the plaintiff’s claim.
Id. at 78, 178 S.E.2d at 818-819.
Chicago Title Ins. Co. v. Wetherington, 127 N.C. App. 457, 461, 490
S.E.2d 593, 596-97 (1997), disc. review denied, 347 N.C. 574, 498
S.E.2d 380 (1998). Plaintiffs and defendant-appellants had brought
actions to quiet title in the present case.
Thus, both sought to
defeat the other’s claim.
In an action commenced against multiple defendants where some,
but not all, of the defendants fail to plead or otherwise respond,
a default judgment against the non-responding defendants does not
bar the other defendants from asserting all defenses they might
have to defeat plaintiff’s claim.
Harris v. Carter, 33 N.C. App.
179, 183, 234 S.E.2d 472, 475 (1977) (citing United States v.
Borchardt, 470 F.2d 257 (7th Cir. 1972)).
Also, it is equally clear that default
final judgment against [a non-responding
defendant], d[oes] not adjudicate any rights
between
plaintiff
and
the
answering
defendants.
The judgment by default final
against [the non-responding defendant], in no
way prejudice[s] the rights of the answering
defendants
in
their
defense
against
plaintiff’s allegations.
Piney Mountain Properties v. Supply Co., 6 N.C. App. 191, 193, 169
S.E.2d 465, 467 (1969).
Under the foregoing authority, assuming
that plaintiffs had made a prima facie case in their action to
quiet
title,
a
default
judgment
against
the
non-responding
defendants did not make any admissions on behalf of defendantappellants, bar any of their defenses or claims, or prejudice their
rights.
It was therefore error for the trial court to quiet title
to the property based on a default judgment against Baldwin, Akbar,
and Sha Kur, as defendant-appellants should have been allowed the
opportunity to present their defense to plaintiffs’ action to quiet
title, and to present their counterclaim to quiet title.
Chicago
Title,
127
N.C.
App.
at
461,
490
S.E.2d
at
See
597.
Accordingly, that portion of the order which purports to quiet
title to the property in favor of plaintiffs is reversed, and this
case is remanded in order for defendant-appellants to be given
their day in court in accordance with this opinion.
Default
judgment as to Clarke W. Baldwin, Kimberly A. Akbar and Farid Sha
Kur is affirmed.
Affirmed in part, reversed in part and remanded.
Judges WALKER and McGEE concur.
