Lowder v. All Star Mills, Inc.

300 S.E.2d 241 (1983)

Malcolm M. LOWDER, Mark T. Lowder and Dean A. Lowder, Plaintiffs, v. ALL STAR MILLS, INC., Lowder Farms, Inc., Carolina Feed Mills, Inc., All Star Foods, Inc., All Star Hatcheries, Inc., All Star Industries, Inc., Tanglewood Farms, Inc., Consolidated Industries, Inc., Airglide, Inc., and W. Horace Lowder, Defendants, and Cynthia E. Lowder Peck, Michael W. Lowder, Douglas E. Lowder, Lois L. Hudson, Individually and as Guardian Ad Litem for Steve H. Hudson, Bruce E. Hudson, Billy J. Hudson, Ellen H. Ballard, Jenell H. Ratterree, David P. Lowder, Judith R. Lowder Harrell, Emily P. Lowder Cornelius and Myron E. Lowder, Intervening Defendants.

No. 8220SC255.

Court of Appeals of North Carolina.

February 15, 1983.

*243 Atty. Gen. Rufus L. Edmisten by Asst. Atty. Gen. Joan H. Byers, Raleigh, for the State.

DeLaney, Millette, DeArmon & McKnight by Ernest S. DeLaney, Charlotte, for defendants-appellants.

BRASWELL, Judge.

A ruling on a motion to recuse a trial judge is an interlocutory order and is not immediately appealable. See Industries, Inc. v. Insurance Co., 296 N.C. 486, 251 S.E.2d 443 (1979). However, since an accusation about a judge's partiality goes to the fundamental issue of maintaining confidence in our court system, we have elected to treat the case as though a petition for certiorari had been allowed and to proceed to the merits, as should the parties henceforth with the case.

We hold that Judge Mills' order correctly concluded, based upon the factual supporting evidence in the record and the law applicable thereto, that Judge Thomas W. Seay, Jr. "has not demonstrated that he is biased or prejudice [sic] for or against any party," and that Judge Seay has not given "the appearance of bias or prejudice for or against any party." Judge Seay should not have recused himself. Judge Mills ruled correctly in ordering Judge Seay not to be removed. The appellants' motion was properly denied. Compare, Bank v. Gillespie, 291 N.C. 303, 230 S.E.2d 375 (1976), and Ponder v. Davis, 233 N.C. 699, 65 S.E.2d 356 (1951).

From the nine assignments of error four questions were presented for review. Before asserting a catch-all fourth question of whether the judge should recuse himself or be recused, the appellants' counsel inquires (1) whether Judge Mills correctly limited the evidence to affidavits, (2) whether Judge Seay acted properly in allowing Horace Lowder to appear on behalf of the corporate defendants, and (3) whether Judge Seay's meeting with the receivers and their attorneys in Richmond County was proper.

At the outset we note that the same motion to recuse Judge Seay, listing the same eight alleged specific instances of bias and including the same subject matter brought forward here under questions 2, 3, and 4, was discussed in a companion opinion of this Court filed 18 January 1983, Lowder v. All Star Mills, Inc., supra. While the companion opinion did not rule upon the issue of whether Judge Seay should have recused himself permanently from the case, it did rule that he was not required to recuse himself before ruling on 19 pretrial motions. After listing and considering the *244 cases cited and relied on by the appellant, our Court said: "In none of those cases did the party making a motion for recusal wait until the presiding judge had virtually concluded the hearings. In this case, Judge Seay had conducted hearings for three weeks on 19 motions. We believe he acted properly in ruling on the motions before referring the matter to some other judge for a hearing on the motion for recusal." Lowder, supra, (At p. 241). To the contention advanced in the January opinion and in our record that only recently had it been revealed to appellants' counsel that Judge Seay held an ex parte hearing without notice to defendants, the January opinion concluded: "We have held in this opinion that the appellants suffered no prejudicial error from that hearing." Lowder, supra, (At p. 241). Under the law of the case all the factual questions ruled upon in the 18 January 1983 decision, Lowder, supra, are res judicata. Transportation, Inc. v. Strick Corp., 286 N.C. 235, 210 S.E.2d 181 (1974); Carpenter v. Carpenter, 25 N.C. App. 235, 212 S.E.2d 911, cert. denied, 287 N.C. 465, 215 S.E.2d 623 (1975); 1 Strong's N.C. Index 3d Appeal and Error § 68 (1976).

In the January opinion of Lowder, supra, (At p. 236), our Court discussed the allegation that "the corporations did not have an attorney (at the show cause hearing on the appointment of receivers) but were represented by W. Horace Lowder, a layman. They contend it is a violation of public policy for a layman to act as an attorney...." This is the same basic argument as presented in the second question before us. For the same reasons given by our Court in Lowder, supra, as well as the law of the case, Transportation, Inc. v. Strick Corp., supra, this assignment of error is overruled.

The third question alleges that Judge Seay conducted an improper ex parte hearing out of Stanly County and in Richmond County in February 1979. In their brief appellants now say: "The defendants do not claim or allege any impropriety in the receivers' meeting and conferring with Judge Seay," but now basically contend that Judge Seay acted improperly in conducting an ex parte hearing which affected appellants' substantial rights out of term and out of county. This identical subject has been ruled upon adverse to appellants in the January opinion, Lowder, supra, (At p. 235), and is now the law of the case.

Thus, there remains for us only the procedural challenge of the way Judge Mills conducted the hearing on the motion for Judge Seay to be recused. Judge Mills limited the evidence before him to affidavits. The appellant complains that he was denied the right to cross-examine the persons submitting affidavits and was denied a right to present oral testimony.

A recusal motion is a pretrial motion. It does not go to the merits of the pleadings. Rule 43(a) of the Rules of Civil Procedure provides the form of receiving evidence in court by stating, "In all trials the testimony of witnesses shall be taken orally in open court, unless otherwise provided by these rules." The rules do "otherwise provide" through Rule 43(e):

"When a motion is based on facts not appearing of record the court may hear the matter on affidavits presented by the respective parties, but the court may direct that the matter be heard wholly or partly on oral testimony or depositions." (Emphasis added)

Judge Mills' decision to hear the motion only on affidavits is in keeping with our Rules of Civil Procedure and is fully supported in the cases. Abuse of judicial discretion is not revealed. For pretrial motion hearings it is affidavits and not oral testimony that is the preferred form of evidence. Pearce Young Angel Co. v. Enterprises, Inc., 43 N.C.App. 690, 260 S.E.2d 104 (1979). See also, Insurance Co. v. Chantos, 21 N.C.App. 129, 203 S.E.2d 421 (1974); Morgan, Attorney General v. Dare To Be Great, 15 N.C.App. 275, 189 S.E.2d 802 (1972). In a hearing on motion for relief from default judgment where judge limited evidence to oral testimony, compare Webb v. James, 46 N.C.App. 551, 265 S.E.2d 642 (1980).

*245 The appellant places his reliance upon Shepherd v. Shepherd, 273 N.C. 71, 77, 159 S.E.2d 357, 362 (1968); and In re Custody of Gupton, 238 N.C. 303, 77 S.E.2d 716 (1953). We conclude neither is apropos. Both Shepherd and Gupton involved evidence leading to final custody of a child. They involved evidence on a claim or defense which turned upon a final factual adjudication on the merits of the case itself. This recusal motion does not affect the final outcome on the merits of the stockholders' derivative claim.

We hold that the procedure adopted and followed by Judge Mills was proper. Because of the seriousness of the challenge to Judge Seay's partiality we have, nonetheless, examined all the findings of fact and conclusions of law as set out in Judge Mills' order, and find the order to be fully supported by the record.

Affirmed.

VAUGHN, C.J., and WELLS, J., concur.