ROCKINGHAM, ETC. v. Integon Life Ins. Corp.

279 S.E.2d 918 (1981)

ROCKINGHAM SQUARE SHOPPING CENTER, INC., and Lee D. Tuttle v. INTEGON LIFE INSURANCE CORPORATION and The Northwestern Bank.

No. 8017SC1155.

Court of Appeals of North Carolina.

July 7, 1981.

*923 Edwards, Greeson, Weeks & Turner by Joseph E. Turner, Greensboro, for plaintiffs-appellants.

Petree, Stockton, Robinson, Vaughn, Glaze & Maready by William F. Maready and Jackson N. Steele, Winston-Salem, for defendant-appellee, The Northwestern Bank.

HARRY C. MARTIN, Judge.

At the final pretrial conference on 9 January 1980, defendant's motion for summary judgment was scheduled for hearing at the 5 May 1980 term of Rockingham Superior Court. The parties subsequently agreed for the hearing to be held on 8 May 1980 at 9:30 a.m. Defendant relied upon the pleadings and discovery of record. At commencement of the hearing, plaintiffs delivered to defense counsel and offered to the court the affidavit of Lee Tuttle. Later that day, plaintiffs produced additional affidavits in opposition to summary judgment. Defendant objected to all of these affidavits, and the trial court sustained the objection. On the second day of the summary judgment hearing, plaintiffs moved pursuant to N.C.G.S. 1A-1, Rule 60(b)(6), for relief from the sustention of defendant's objection. This motion was denied, and plaintiffs now assign error to these two rulings. We find no error in them.

Plaintiffs argue that N.C.G.S. 1A-1, Rule 56, does not require that affidavits in opposition to summary judgment be filed in advance of the hearing and, alternatively, that Rule 6(d) gives the trial court discretion to allow late filing of opposing affidavits. Rule 56(c), in pertinent part, provides: *924 "The adverse party prior to the day of hearing may serve opposing affidavits." Insurance Co. v. Chantos, 21 N.C.App. 129, 203 S.E.2d 421 (1974), dealt with the question of when affidavits in support of a motion for summary judgment must be filed and served. In the course of deciding that issue, this Court quoted the above provision of Rule 56(c) and wrote: "It is clear that opposing affidavits are to be served prior to the day of the hearing." Id. at 130, 203 S.E.2d at 423. This statement is in accord with authorities under the comparable federal rule. See Jones v. Menard, 559 F.2d 1282 (5th Cir. 1977); Beaufort Concrete Co. v. Atlantic States Construction Co., 352 F.2d 460 (5th Cir. 1965), cert. denied, 384 U.S. 1004, 86 S. Ct. 1908, 16 L. Ed. 2d 1018 (1966); 10 Wright and Miller, Federal Practice and Procedure § 2719 (1973). We now reaffirm that affidavits in opposition to a motion for summary judgment should be served prior to the day of the hearing. It is true that Rule 6(b) and (d) gives the trial court discretion to allow the late filing of affidavits. However, both Chantos and federal cases hold to the effect that absent a showing of excusable neglect, the trial court does not abuse its discretion when it refuses to accept late affidavits. Chantos, supra; Farina v. Mission Inv. Trust, 615 F.2d 1068 (5th Cir. 1980); Beaufort Concrete Co., supra.

In the present case the plaintiffs had notice of the summary judgment hearing nearly four months in advance. The discovery relied upon by defendant was of record. Plaintiffs offered no explanation for their delay in presenting opposing affidavits, and we find no error in the trial court's exclusion of them. Plaintiffs' Rule 60(b)(6) motion for relief from sustention of the objection to their affidavits was, of course, inappropriate, as that rule expressly applies only to final judgments. Sink v. Easter, 288 N.C. 183, 217 S.E.2d 532 (1975). Regardless of the rule cited, we find no abuse of discretion in the trial court's refusal to reconsider its ruling. In any event, plaintiffs were not prejudiced. Lee Tuttle's deposition was already before the court. We have reviewed the affidavits tendered by the plaintiffs, and we find that they add nothing of legal significance to the materials which were considered at the summary judgment hearing.

The principles applicable to summary judgment are well established. The moving party has the burden of clearly establishing the lack of any triable issue of fact. The papers supporting the movant's position are to be closely scrutinized while those of the opposing party are to be regarded indulgently. The motion may only be granted where there is no genuine issue as to any material fact and the moving party is entitled to judgment as a matter of law. See, e.g., Yount v. Lowe, 288 N.C. 90, 215 S.E.2d 563 (1975); Zimmerman v. Hogg & Allen, 286 N.C. 24, 209 S.E.2d 795 (1974); Singleton v. Stewart, 280 N.C. 460, 186 S.E.2d 400 (1972). "Two types of cases are involved: (a) Those where a claim or defense is utterly baseless in fact, and (b) those where only a question of law on the indisputable facts is in controversy and it can be appropriately decided without full exposure of trial." Kessing v. Mortgage Corp., 278 N.C. 523, 533, 180 S.E.2d 823, 829 (1971). We find summary judgment appropriate in the present case.

Summary judgment was properly entered on the basis of Northwestern's affirmative defense of accord and satisfaction. Dobias v. White, 239 N.C. 409, 80 S.E.2d 23 (1954), explains accord and satisfaction as follows:

An accord and satisfaction is compounded of the two elements enumerated in the term. "An `accord' is an agreement whereby one of the parties undertakes to give or perform, and the other to accept, in satisfaction of a claim, liquidated or in dispute, and arising either from contract or tort, something other than or different from what he is, or considers himself, entitled to; and a `satisfaction' is the execution or performance, of such agreement." 1 C.J.S. Accord and Satisfaction § 1.

Id. at 413, 80 S.E.2d at 27.

Defendants' plea of accord and satisfaction "is recognized as a method of *925 discharging a contract, or settling a cause of action arising either from a contract or a tort, by substituting for such contract or cause of action an agreement for the satisfaction thereof, and an execution of such substitute agreement." ... The word "agreement" implies the parties are of one mind all have a common understanding of the rights and obligations of the others there has been a meeting of the minds.... Agreements are reached by an offer by one party and an acceptance by the other. This is true even though the legal effect of the acceptance may not be understood.

Prentzas v. Prentzas, 260 N.C. 101, 103-04, 131 S.E.2d 678, 680-81 (1963) (citations omitted).

In Construction Co. v. Coan, 30 N.C.App. 731, 228 S.E.2d 497, disc. rev. denied, 291 N.C. 323, 230 S.E.2d 676 (1976), the plaintiff constructed a motel for the defendants. There was a delay in completion of the project, and construction cost more than the guaranteed maximum set forth in the contract. After completion, the plaintiff and the defendants met in September 1973 to discuss their problems. The defendants agreed to pay the plaintiff a certain amount by certified check and to execute two notes to the plaintiff in return for the plaintiff's execution of an affidavit acknowledging payment in full and waiving any lien rights in the project. This agreement was carried out, but defendants failed to pay the notes and the plaintiff filed suit. The defendants answered and counterclaimed for breach of the construction contract. The plaintiff raised the affirmative defense of accord and satisfaction in its reply. The plaintiff moved for summary judgment on the basis of its president's affidavit regarding the September 1973 meeting. The defendants produced an affidavit stating that no resolution of the contract dispute or complete resolution had occurred. The plaintiff was allowed summary judgment. On appeal this Court wrote:

Normally, the existence of an accord and satisfaction is a question of fact for the jury. But where the only reasonable inference is existence or non-existence, accord and satisfaction is a question of law and may be adjudicated by summary judgment when the essential facts are made clear of record. 1 Am.Jur.2d, Accord and Satisfaction, § 53, p. 352.

Id. at 737, 228 S.E.2d at 501. The Court noted that the amount due the plaintiff was in dispute, that the defendants agreed to execute the notes, that the plaintiff's affidavit clearly established that the notes were given in full satisfaction of the disputed debt, and that at no time between execution of the notes and their counterclaim some year and a half later did the defendants deny their obligation on the notes by reason of plaintiff's breach of contract. The Court held that the only possible inference to be drawn from the affidavits was that an accord and satisfaction had been reached at the September 1973 meeting and that defendants' affidavit amounted to a mere general denial, which was insufficient to put the existence of an accord and satisfaction in issue. Summary judgment was affirmed; the cause was remanded for determination of the interest due on the notes.

In the present case the evidence tends to show that the shopping center was facing financial collapse in September 1976 when Cos-Wat offered to buy it for one million dollars. Northwestern offered certain concessions as part of such a sale. Northwestern agreed to forgive more than $40,000 in interest and other fees to which it was entitled, to relieve the Tuttles of their individual liability as guarantors, and to consolidate and refinance the Tuttles' remaining liability, with certain business property as security. The three Tuttle brothers met as stockholders and voted two to one to accept the offer. Lee Tuttle opposed the sale. His deposition reveals that his objection was based upon his desire to pursue a better deal, not on a desire to sue Northwestern. The stockholders did not assert any claim against Northwestern, although the acts now complained of had already occurred. Carl Tuttle explained his vote as follows: "I wanted to avoid foreclosure if I could. I wanted to avoid as much interest owed as *926 possible. I wanted to get out, just to put it bluntly."

The agreement for the sale of the shopping center was signed on 16 September 1976. On 23 September 1976 the parties appeared before the bankruptcy judge to request approval of the sale. Rockingham Square's trustee stated that the parties had "agreed on a basis for resolving all of the various relationships between the bank, the corporation, and the individual stockholders as guarantors which would follow from the sale and employ the proceeds of the sale." The only concern voiced by the attorney for Rockingham Square and Lee Tuttle involved exposure to foreclosure should the bankruptcy proceedings be dismissed and the sale not go through. The next day, 24 September 1976, the bankruptcy proceedings were dismissed by an order finding that "the stockholders and the Bank have agreed upon a settlement of all obligations and other matters and things in dispute among them." When the sale was subsequently completed, the parties' accord was satisfied. Based upon the above, we conclude that the only reasonable inference to be drawn from the evidence is that the parties' agreement represented a settlement of all matters in dispute among them, exactly as found by the bankruptcy judge. The trial court properly determined that an accord and satisfaction appeared as a matter of law.

Moreover, it appears that summary judgment was properly entered, as the plaintiffs' claims are "utterly baseless in fact." Kessing v. Mortgage Corp., supra. For example, plaintiffs' claim for breach of contract is based upon the allegation that Northwestern forced plaintiffs to hire a general contractor even though their contract did not require one. However, the evidence reveals that a general contractor was required by contract. The best that can be said of Tuttle's deposition testimony is that he attempted to talk Northwestern out of the general contractor requirement and that he "didn't know" what stage the construction loan was in when he decided to engage Alvis Hole as general contractor.

Plaintiffs' claim of fraud is based upon the allegation that Northwestern induced them into entering the second permanent loan commitment with Integon by promising to "do whatever was necessary" to help plaintiffs meet Integon's requirement that the borrower and guarantors be solvent. In Tuttle's deposition we find the following:

Q. Now, you allege in the complaint that somebody at Northwestern made the statement to you that "We'll meet the solvency problem when we get to it or cross that bridge when we get to it" or words to that effect? A. Words to that effect; yes, sir.

The deposition is insufficient to show a definite and specific representation by Northwestern to the effect alleged in the complaint. Moreover, the deposition does not show clearly that the above statement was made before acceptance of Integon's second permanent loan commitment. Finally, we note that plaintiffs have failed to show how they were damaged by entering the second permanent loan commitment. The evidence does not support a claim for actionable fraud. See generally Ragsdale v. Kennedy, 286 N.C. 130, 209 S.E.2d 494 (1974).

Plaintiffs' claims based upon the theories of joint venture and abuse of process also fail. Among other elements, an agreement for the sharing of profits is essential to creation of a joint venture, Pike v. Trust Co., 274 N.C. 1, 161 S.E.2d 453 (1968); 46 Am.Jur.2d Joint Ventures § 13 (1969), and the element is lacking herein. Plaintiffs' claim for abuse of process is based upon Northwestern's agreement to delay its foreclosure, in return for certain concessions, while plaintiffs attempted to sell the shopping center. This agreement represented a legitimate effort by the parties to avoid foreclosure, not a "malicious misuse or perversion of a civil or criminal writ to accomplish some purpose not warranted or commanded by the writ." Barnette v. Woody, 242 N.C. 424, 431, 88 S.E.2d 223, 227 (1955) *927.

Finally, plaintiffs group several allegations under claims of negligence and negligent misrepresentation, see Davidson and Jones, Inc. v. County of New Hanover, 41 N.C.App. 661, 255 S.E.2d 580, disc. rev. denied, 298 N.C. 295, 259 S.E.2d 911 (1979), and unfair trade practices, see N.C. Gen. Stat. 75-1.1; Johnson v. Insurance Co., 300 N.C. 247, 266 S.E.2d 610 (1980). Suffice it to say that we have reviewed plaintiffs' various allegations and find summary judgment proper as to each of them.

Affirmed.

HEDRICK and WELLS, JJ., concur.