Chase Group v. Fisher, Clinard & Cornwell
211 N.C. App. 295
| N.C. Ct. App. | 2011Background
- Chase NC acquired property and formed Chase MD; Jorgenson and Mellor were officers and owners.
- Loan to Chase NC in 1999 included recourse covenants making Jorgenson and Mellor personally liable for certain attorney fees.
- GMAC sued Chase NC; a receiver was appointed; later bankruptcy proceedings were filed by Fisher Clinard on behalf of Chase NC.
- Lefkowitz advised against deed in lieu of foreclosure; bankruptcy filing occurred April 2004, with Lefkowitz representing Chase NC only.
- GMAC then sought personal liability against Jorgenson and Mellor; a state court order awarded GMAC fees against them in 2006.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Sufficiency of the evidence for involuntary dismissal | Jorgenson and Mellor argue evidence shows LP damages and negligence. | Defendants contend the record lacks support for the trial court's findings. | Yes; findings supported denial of dismissal and damages awarded. |
| Last act of negligence and statute of limitations | Period extended beyond October 2003-April 2004 due to continuous representation. | Last negligent acts occurred outside 3-year limit; time-bar applies. | Trial court's period 22 April 2005–15 March 2006 within 3 years; not barred. |
| Continuous representation of Jorgenson and Mellor | Defendants represented them continuously through 2004. | Defendants represented Chase NC, not individuals, during that period. | Findings support two periods of representation; first period barred under 3-year limit. |
| Duty to non-client third parties under Miller | Third-party duty theory could extend liability. | No preserved third-party beneficiary theory; no merit even if preserved. | Not preserved and meritless. |
Key Cases Cited
- Hill v. Lassiter, 135 N.C.App. 515, 520 S.E.2d 797 (1999) ( Rule 41(b) involuntary dismissal standard; not a directed verdict)
- Neff v. Coach Co., 16 N.C.App. 466, 192 S.E.2d 587 (1972) (test for involuntary dismissal differs from Rule 50)
- Lake Gaston Estates Prop. Owners Ass'n v. County of Warren, 186 N.C.App. 606, 652 S.E.2d 671 (2007) (appellate deference to trial court factual findings)
- Taylor v. Abernethy, 174 N.C.App. 93, 620 S.E.2d 242 (2005) (burden to prove damages by greater weight of the evidence; not amount)
- Short v. Chapman, 261 N.C. 674, 136 S.E.2d 40 (1964) (pecuniary damages must be proven and proximately caused)