Keith v. Silvia

Annotate this Case

64 S.E.2d 178 (1951)

233 N.C. 328


No. 163.

Supreme Court of North Carolina.

March 21, 1951.

*181 L. B. Prince, Hendersonville, for plaintiff appellee.

J. E. Shipman, Hendersonville, and Kellum & Humphrey, Wilmington, for defendant appellant.

BARNHILL, Justice.

The order of the court below discharging the referee must be held for error. In civil cases the parties have the right to select the manner of trial of their cause. They may waive trial by jury and submit the controversy to the judge presiding, or they may agree to submit the cause to a referee. When, as here, the parties agree upon a reference, the consent of the parties continues until the order of reference is complied with by a full report. The order cannot be revoked at the election of one of the parties without the consent of the other. Flemming v. Roberts, 77 N.C. 415; American Trust Co. v. Jenkins, 196 N.C. 428, 146 S.E. 68; Mills v. Apex Ins. & Realty Co., 196 N.C. 223, 145 S.E. 26; Smith v. Hicks, 108 N.C. 248, 249, 12 S.E. 1035.

The consent extends not only to the terms of the reference but also to the person of the referee. The referee selected by the parties, or by their consent, must continue as such until the order has been fully executed and the final report made, unless by like consent another is substituted in his stead. Flemming v. Roberts, supra.

We do not mean to say that the court may not discharge a referee for wilful failure to discharge his duties or for intentional disregard of the order of reference, American Trust Co. v. Jenkins, supra. But no such cause is here made to appear.

It is true the court concluded "That the Referee has not performed his duties and has indicated a lack of responsibility to his duties as Referee", but this conclusion is bottomed on two specific findings of fact: (1) The referee was directed to file his report on or before 10 April 1950, and (2) the referee "failed and refused" to file his report until the order signed by the Honorable Luther Hamilton was served on him.

The report was not filed by 10 April 1950 as in said order directed. Even so, plaintiff is in no position to assert that fact as cause for removing the referee. The parties continued with the reference without objection until the report was prepared and copies thereof were furnished to counsel, actually entering into stipulations in respect thereto as late as 13 September, *182 after the motion herein was filed in court. Any cause for objection that the referee failed to file the report as in said order directed was waived. A party to a reference will not be permitted to proceed with the reference after the day fixed for the final report, without objection, thereby taking his chances of a decision in his favor, and then at a later stage, after a decision has been or seems likely to be rendered against him, for the first time, urge the delay as cause for removing the referee. Andrews v. Jordan, 205 N.C. 618, 172 S.E. 319.

The able and conscientious attorney to whom this cause was referred encountered those conditions so often arising in reference matters which serve to delay a prompt report. As disclosed by the report filed, this delay was caused in large part by counsel for the parties. Counsel who actually appeared at the hearings before the referee have not seen fit to challenge or contradict these statements. The record remains devoid of any substantial grounds for a conclusion that the referee wilfully refused or intentionally failed to file his report as promptly as conditions would permit.

The amounts paid the referee were paid by the parties under the terms of the consent reference. The court was without authority to require the referee to refund the same.

Likewise, that part of the order which rejects the report of the referee "as being unacceptable" must be held for error. This for two reasons: (1) It is based on specific findings of fact which are unsupported by the record, and (2) the report was not before the judge for consideration.

The judge found that the referee in his report does not set out his findings of fact and conclusions of law, and he failed to file his report in the time allowed by the order. While the referee does not divide his report into subtitles, "findings of fact" and "conclusions of law", as is sometimes done, he found all the essential facts at issue. The facts found are supported by evidence and are sufficient to support his conclusions of law. On this record the delay in filing the report is no cause for rejecting the same.

The judge of the Superior Court, in the exercise of his supervisory power and under the statute, G.S. § 1-194, may affirm, amend, modify, set aside, confirm in whole or in part, or disaffirm the report of a referee, or he may make additional findings of fact and enter judgment on the report as thus amended. Anderson v. McRae, 211 N.C. 197, 189 S.E. 639, and cases cited. But this does not mean that the judge may, ex mero motu, vacate a report upon which no attack has been made by any of the parties. The authority must be exercised, if at all, in an orderly manner in accord with recognized rules of procedure. "Either party * * * may move the judge to review the report, and set aside, modify or confirm it in whole or in part * * *", G.S. § 1-194, and the report "may be excepted to by either party * * * and reviewed in like manner and with like effect in all respects as in cases of appeal * * *." G.S. § 1-195.

The broad supervisory power of the judge is to be exercised in ruling upon exceptions duly entered, or some motion directly attacking the validity of the report. Hardaway Contracting Co. v. Western Carolina Power Co., 195 N.C. 649, 143 S.E. 241; Wallace v. Benner, 200 N.C. 124, 156 S.E. 795; Thigpen v. Farmers' Banking & Trust Co., 203 N.C. 291, 165 S.E. 720; Holder v. Home Mortgage Co., 214 N.C. 128, 198 S.E. 589.

Speaking to the subject in Anderson v. McRae, supra, Stacy, C. J., says: "This he may do, however, only in passing upon the exceptions, for in the absence of exceptions to the factual findings of a referee, such findings are conclusive * * * and where no exceptions are filed, the case is to be determined upon the facts as found by the referee." [211 N.C. 197, 189 S.E. 640.] McIntosh P & P 577.

Plaintiff's motion does not assail the report of the referee. Indeed, at the time the motion was entered, the report had not been filed. No exceptions have been entered. The cause, by the stipulations *183 of the parties, had in effect been continued until 14 October. The report was not before the judge for consideration. The order rejecting the same must be vacated.

In this connection it is interesting to note that the record presents a somewhat novel situation. While the order was signed out of term 21 October, it is made retroactive and effective as of 12 September. Thus the order rejects as being unacceptable a report which was not on file on the effective date of the order.

On a consent reference, findings of fact made by a referee, in the absence of exceptions thereto, are conclusive on the hearings in the Superior Court as they are on appeal to this court. The findings to which no exceptions are entered become in effect facts agreed. Bank of Rose Hill v. Graham, 198 N.C. 530, 152 S.C. 493; City of Salisbury v. Lyerly, 208 N.C. 386, 180 S.E. 701.

Therefore, for the reasons stated, the report filed by the referee must be restored to its rightful place on the civil issue docket. In the absence of exceptions thereto, it should be affirmed and judgment entered in accord therewith.

Error and remanded.