211 N.C. App. 546
N.C. Ct. App.2011Background
- Plaintiffs obtained a loan in 2002 from Greenpoint Mortgage Funding, secured by a deed of trust on their Monroe home.
- Default occurred by December 2003, prompting a Forbearance Agreement to suspend foreclosure conditioned on timely payments.
- The Forbearance Agreement included a Time is of the Essence clause and a Waiver of Notice of Default allowing resumption of foreclosure without notice.
- Approximately four months later, the deed of trust was transferred to Countrywide, which assumed the same Forbearance terms.
- In 2005–2007, plaintiffs were late on payments; foreclosures were pursued by trustees; a clerk’s order allowed foreclosure; a 2007 consent order stayed/controlled further proceedings; plaintiffs filed UDP and tortious interference claims in 2007, later narrowed to summary-judgment posture, which the trial court granted in 2009; appeal followed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether UDP claim survives summary judgment. | Plaintiffs argue defendants’ late payments and acceptance, without proper notice, show unfair/deceptive acts. | Defendants contend no immoral or deceptive conduct; breach of contract alone cannot sustain UDP. | No genuine issue; UDP claim fails as a matter of law. |
| Whether tortious interference with contract was properly dismissed. | Plaintiffs contend defendants interfered with the Forbearance Agreement via acceleration of the note. | Defendants, as assignees, could not interfere with a contract to which they were not a party; no interference with a contract between plaintiffs and Greenpoint. | Properly granted summary judgment for defendants. |
| Whether N.C. Gen. Stat. § 45-21.34 claims were properly dismissed or barred by consent order. | Plaintiffs relied on § 45-21.34 for equitable relief from foreclosure. | Consent order effectively dismissed that claim without prejudice; § 45-21.34 cannot support reversal. | § 45-21.34 claim was effectively dismissed by the consent order. |
| Whether the clerk’s findings under § 45-21.16(c)(7)(d) limited the review of foreclosure and allowed de novo review on the debt/default issues. | Plaintiffs argued there was a disputed debt amount and timing affecting validity of foreclosure. | Equitable defenses belong under § 45-21.34; § 45-21.16(c)(7)(d) findings apply to direct challenges; equitable claims are separate. | Foreclosure challenge properly addressed under § 45-21.34; no error in summary judgment on related claims. |
Key Cases Cited
- Meehan v. Cable, 127 N.C.App. 336 (1997) (authority for § 45-21.34 equity action; not entitlement to nominal damages)
- Sloop v. London, 27 N.C.App. 516 (1975) (distinguishes breach of contract from § 75-1.1 damages for wrongful foreclosure)
- Watson Elec. Constr. Co. v. Summit Cos., 160 N.C.App. 647 (2003) (breach of contract alone not § 75-1.1 unfair or deceptive practice)
- Beck v. City of Durham, 154 N.C.App. 221 (2002) (elements of tortious interference with contract; party cannot interfere with its own contract; material facts necessary)
- Mosler ex rel. Simon v. Druid Hills, 199 N.C.App. 293 (2009) (limits review of clerk's findings in foreclosure appeals; de novo review on debt/default issues)