Griners'& Shaw, Inc. v. Continental Casualty Co.

Annotate this Case

121 S.E.2d 572 (1961)

255 N.C. 380

GRINERS' & SHAW, INC. v. CONTINENTAL CASUALTY COMPANY, Southern Contractors, Inc., and Atlantic Contractors, Inc.

No. 166.

Supreme Court of North Carolina.

September 27, 1961.

*574 Ellis, Godwin & Hooper by Glenn L. Hooper, Jr., for plaintiff, appellee.

E. K. Powe and W. Travis Porter, Durham, for Continental Casualty Co., defendant, appellant.

PARKER, Justice.

Defendant Continental Casualty Company assigns as errors Judge Morris' findings, or more properly conclusions, even though his striking out subsections (c) and (d) of the order for examination was in its favor, and his order. Both assignments of error are supported by exceptions.

Defendant's exception to Judge Morris' order raises the question whether any error of law appears on the face of the record. This includes the legal sufficiency of the application for examination to support the order of examination, Webb v. Gaskins, N.C., 121 S.E.2d 564, where many authorities are cited, because the application for examination is a necessary part of the record proper. Thrush v. Thrush, 245 N.C. 63, 94 S.E.2d 897; Strong's N.C. Index, Vol. I, Appeal and Error, § 33, where many cases are cited.

G.S. § 1-568.3 provides: "An examination may be had before trial pursuant to the provisions of this article(1) For the purpose of obtaining information necessary to prepare a pleading * * *."

G.S. § 1-568.9(a) reads: "Before the examining party has filed his complaint, petition or answer, he may procure an examination pursuant to this article only upon showing by affidavit, as provided by G.S. § 1-568.10, that the examination is necessary to enable him properly to prepare his complaint, petition or answer."

G.S. § 1-568.10(b) provides: "The application must be in the form of, or supported by, an affidavit showing: (1) That the action *575 has been commenced and the purpose thereof; (2) That, in order to prepare his complaint, petition or answer, it is necessary for the applicant to secure information from the person proposed to be examined about certain matters, which matters must be designated with reasonable particularity; (3) That the information sought is not otherwise available to the applicant, together with a statement of the reasons therefor."

The Act 1951 Session Laws of North Carolina, Chapter 760, relating to the examination of parties and certain other persons before trial, now codified as G.S. §§ 1-568.1 through 1-568.27, repealed the former statutes (G.S. §§ 1-568 through 1-576) concerning the examination of parties before trial. Tillis v. Calvine Cotton Mills, 238 N.C. 124, 76 S.E.2d 376.

The application for an order of examination states that plaintiff's action is "for the purpose of collecting money due the plaintiff in the sum of $5,090.05 for labor and materials, plus interest." Certainly, plaintiff knows to whom it furnished labor and materials, and who is indebted to it for them. The application and record proper furnish no definite answer as to whom plaintiff furnished labor and materials, though it seems from the application and record proper that plaintiff furnished labor and materials in the sum of $5,090.05 to either Southern Contractors, Inc., or Atlantic Contractors, Inc., both defendants, and that Atlantic Contractors, Inc., constructed certain housing at Camp Lejeune, and Continental Casualty Company executed a bond or bonds on or about 30 March 1959 wherein Atlantic Contractors, Inc., is principal. There is nothing in the application or record proper to show that Continental Casualty Company executed any bond with Southern Contractors, Inc., as principal.

Plaintiff states in its brief: "The plaintiff certainly admits that it is in a position to file a complaint against the appellant, Continental Casualty Company, upon the basis of a certain payment bond and this was admitted to the trial court. However, this does not preclude the existence of other `contracts, agreements and bonds made by and between Continental Casualty Company and any other defendant herein,' whereby the plaintiff would be able to allege a cause of action other than upon the above referred to bond."

It seems apparent that plaintiff has available to it sufficient essential and material facts to draft its complaint for money due for labor and material furnished in the sum of $5,090.05 against the corporation to whom it furnished it, and whom it surely knows, and for a cause of action on the bond or bonds dated on or about 30 March 1959 executed by Continental Casualty Company, wherein Atlantic Contractors, Inc., is principal, and we are fortified in our opinion by the statement in plaintiff's brief quoted above. It also seems apparent from the application that plaintiff has not designated with reasonable particularity any matters about which it seeks to examine Continental Casualty Company and its designated officers and employees, which are material and necessary to draft its complaint in the instant action "for the purpose of collecting money due the plaintiff in the sum of $5,090.05 for labor and material," and on the bond or bonds of Continental Casualty Company, and plaintiff admits this in its brief. To paraphrase language used in Cates by Borland v. Griffith Finance Co., 244 N.C. 277, 93 S.E.2d 145, plaintiff's application for examination is a fishing expedition, and it seeks judicial license to cast its line into the records and business of the Continental Casualty Company, and thereby to land some other cause of action than the action it has instituted. Such a ransacking expedition seeking a new cause of action is not within the intent and purpose of the 1951 Act permitting an examination before trial for the purpose of obtaining information necessary to prepare a complaint in the action instituted. Plaintiff is entitled to an order of examination only in respect to those matters which relate *576 to the action it has instituted. Cates by Borland v. Griffith Finance Co., supra.

The factual averments in plaintiff's application for an order of examination are fatally insufficient to support Judge Morris' order.

The factual averments in the application for examination of defendant to obtain information to file a complaint in Jones v. Fowler, 242 N.C. 162, 87 S.E.2d 1, the record of which is on file in the office of the clerk of this Court, were decided by this Court to be sufficient. This was an action by a tenant against a landlord for an accounting for the year 1954. The application states in substance that an examination of defendant is necessary for plaintiff properly to prepare his complaint, because defendant has all the records in respect to their farming operations during 1954, such as advancements made to plaintiff, insurance issued on the crops, amount of insurance collected, and the amount for which the 1954 crops sold. The Jones case is easily distinguishable from the instant case.

The order of Judge Morris below for an examination is