MARTIN-KAHILL FORD LINCOLN v. Skidmore

303 S.E.2d 392 (1983)

MARTIN-KAHILL FORD LINCOLN MERCURY, INC. v. Ray SKIDMORE and Ray Skidmore Ford, Inc.

No. 8225SC663.

Court of Appeals of North Carolina.

June 21, 1983.

Cagle & Houck by Joe N. Cagle, Hickory, for plaintiff-appellant.

Michael P. Mullins, Charlotte, for defendant-appellee.

BRASWELL, Judge.

Plaintiff first argues that the court erred in denying its motion for summary judgment against defendant. It is well-settled that denial of a motion for *393 summary judgment is interlocutory and therefore not appealable, unless a substantial right of one of the parties would be affected if the appeal were not heard prior to final judgment. Leasing Corp. v. Myers, 46 N.C.App. 162, 265 S.E.2d 240, appeal dismissed, 301 N.C. 92 (1980). In this case, plaintiff appealed from the denial of its motion after a full trial had been held and jury verdict returned in its favor. The issue therefore is moot since plaintiff in fact prevailed after a trial on the merits. Even if summary judgment had been granted, plaintiff still would have had to prove the amount of damages it sought to recover since the only evidence of the encumbrances was the notices of attachment and garnishment from the Town of Hudson and Caldwell County. The ownership of the assets as of 1 January 1980 was in dispute, according to the conflicting allegations in the complaint and answer. Plaintiff failed to allege in its complaint that it had in fact paid the tax liens. We also note that plaintiff failed to preserve as error the denial of the motion by excepting at the time of the denial. Compare Motyka v. Nappier, 9 N.C. App. 579, 176 S.E.2d 858 (1970), with Oil Co. v. Smith, 34 N.C.App. 324, 237 S.E.2d 882 (1977). We find no merit to this assignment of error.

Plaintiff next argues that the court erred in removing from the jury the issue of actual damages and in instructing only on nominal damages.

There is little dispute over the facts. The evidence showed that in the agreement to purchase the assets of the automobile dealership dated 26 September 1979, defendant impliedly and expressly warranted that the assets would be delivered free from any security interest, lien or encumbrance. Testimony from the Caldwell County Tax Collector showed that the dealership's 1979 and 1980 personal property taxes had not been paid. The Town of Hudson Tax Collector testified that 1979 and 1980 taxes had been paid by North Carolina National Bank (NCNB) for plaintiff's account. There was some dispute concerning the effective date of the sale between plaintiff and defendant. Jerry Kahill, president of plaintiff, testified that the final bill of sale was signed on 30 December 1979, but that the date shown on the closing document was 3 January 1980. He and about 18 other employees began working at the dealership in December of 1979, opened an account with NCNB to finance the purchase of automobiles in December, received new automobiles in December from Lincoln-Mercury, and advertised using the new dealership name in December.

At the close of the evidence, the court conducted a hearing on defendant's motion for a directed verdict. The following conversation occurred:

"THE COURT: The motion for directed verdict by the individual defendant is granted. I don't know whether there is any evidence that you [sic] client has paid any money or not. It says paid by the bank for the account of your client. The law is you can only recover what you have paid out in these cases. MR. CAGLE: [Plaintiff's counsel] I believe on January 1 the tax collector has a lien. THE COURT: It doesn't matter whether he has a lien. The law of a warranty or a guarantey [sic] against encumbrances is that you can only recover what you have paid. It doesn't matter if there is a lien. What you are out of pocket if you haven't satisfied the lien, you can only get nominal damages. I don't know what else to do but instruct the jury they can give you nominal damages."

Judge Snepp was applying the established rule of law in this State, as enunciated in Seymour v. Sales Co., 257 N.C. 603, 609, 127 S.E.2d 265, 269 (1962). In Seymour, the Supreme Court stated that upon discovery of breach of warranty, a buyer can rescind the contract, return the goods, demand return of the sales price, and upon refusal by seller to comply, institute an action for the sales price. Alternatively, a buyer can waive the right to rescind and institute "an action for damages for breach of warranty against encumbrances. In *394 such action, a buyer cannot recover anything more than nominal damages until he has paid the amount of the outstanding lien or has been deprived of possession by reason of the lien in question...." Id. Although Seymour pre-dates the adoption of the Uniform Commercial Code in 1967, our research has not disclosed any change since the adoption in the law on damages as set forth in Seymour. See G.S. 25-1-103.

We find from a review of the evidence presented that plaintiff failed to prove that it had paid the amount of the outstanding tax liens or that it had sustained any actual damages as a result of the liens. The Caldwell County Tax Collector testified that 1979 and 1980 personal property taxes had not been paid. The Tax Collector for the Town of Hudson testified that the 1979 and 1980 taxes had been paid by NCNB for plaintiff's account. Plaintiff, however, presented no evidence that it had actually paid the taxes, that it was indebted to NCNB for the amount paid by NCNB, or that it was deprived of possession because of the tax liens. Pursuant to Seymour, we hold that the court's instruction to the jury that plaintiff was entitled only to recover nominal damages was proper.

We do not discuss plaintiff's contentions concerning the trial judge's failure to conduct a jury instruction conference and concerning the lack of opportunity given to counsel to object to any portion of the charge. In violation of Rule 10(a), (b) and (c), N.C.Rules App.Proc., plaintiff failed to take exception in the record or to assign as error these omissions of the court.

In the judgment rendered below, we find

No error.

WEBB and WHICHARD, JJ., concur.