264 N.C. App. 71
N.C. Ct. App.2019Background
- In November 2009 a report alleged an eight-year-old child was inappropriately touched by employee Ricky Cromartie at Nanny’s Korner daycare; DSS investigated and "substantiated" the allegation in February 2010.
- The North Carolina Department of Health and Human Services (Division of Child Development and Early Education) relied on DSS’s substantiation, issued a written warning to the daycare and barred Mr. Cromartie from the premises during operating hours in June 2010 without conducting an independent investigation.
- Plaintiff sought administrative review; an ALJ (July 2011) and the agency (March 2012) upheld the agency action; the Court of Appeals reversed the agency in Nanny’s Korner I (May 2014), holding the agency must independently investigate and afford an opportunity to contest substantiation.
- The written warning triggered loss of customers and eventual closure of the daycare; Plaintiff later filed claims seeking monetary relief under the Tort Claims Act and a direct state constitutional due process claim.
- Plaintiff filed a Tort Claims Act affidavit (Jan 2017) and a separate Article I, Section 19 due-process action in superior court (May 2017); the Industrial Commission dismissed the tort claim as time-barred and the superior court dismissed the constitutional claim on statute-of-limitations grounds (Mar 2018).
- The Court of Appeals affirmed, holding the limitations period began around issuance of the written warning (mid-June 2010), was not tolled by administrative appeals, and an adequate state remedy (Tort Claims Act) existed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| When did the statute of limitations accrue for Plaintiff's due-process claim and was it tolled by administrative exhaustion? | Accrual was tolled while Plaintiff exhausted NCAPA remedies; cause of action accrued when appellate mandate issued (June 2014). | Accrual began when the written warning was issued (≈ June 2010); NCAPA exhaustion did not toll limitations because Plaintiff sought monetary relief not available in NCAPA. | Limitations began ≈ June 2010; not tolled by administrative appeals; complaint filed May 2017 was time-barred. |
| Whether Plaintiff pleaded a direct state constitutional (procedural due-process) claim admissible against the State. | Plaintiff alleges NCAPA provided no adequate remedy for reputational loss, lost goodwill, lost income and profits, so a direct claim is permitted. | An adequate remedy existed under the Tort Claims Act and Industrial Commission. | The Tort Claims Act was an adequate state remedy; therefore Plaintiff cannot maintain a direct constitutional claim. |
| Whether failure to pursue timely Tort Claims Act remedy renders that remedy inadequate. | The dismissal of Plaintiff's tort claim for being filed late shows the state remedy was inadequate. | Plaintiff's failure to comply with statutory deadlines does not make the statutory remedy inadequate. | Procedural failure to meet the statute of limitations does not make the remedy inadequate; remedy existed. |
| Whether Plaintiff may recover monetary damages directly under Article I, §19 after administrative review. | Monetary recovery is appropriate because NCAPA remedies do not compensate for the alleged injuries. | Monetary relief was available via the Tort Claims Act; therefore direct constitutional relief is not available. | Monetary relief should have been sought under the Tort Claims Act; direct claim not warranted here. |
Key Cases Cited
- Nanny’s Korner Care Ctr. v. N.C. HHS, 234 N.C. App. 51, 758 S.E.2d 423 (N.C. Ct. App. 2014) (agency must independently investigate and allow contest of DSS substantiation)
- Corum v. University of North Carolina, 330 N.C. 761, 413 S.E.2d 276 (N.C. 1992) (direct state constitutional claim against the State where no adequate remedy at law exists)
- Craig v. New Hanover Cty. Bd. of Educ., 363 N.C. 334, 678 S.E.2d 351 (N.C. 2009) (plaintiff bears burden to plead inadequacy of state remedy for direct constitutional claim)
- Jackson for Jackson v. N.C. Dep’t of Human Resources, 131 N.C. App. 179, 505 S.E.2d 899 (N.C. Ct. App. 1998) (statutory administrative remedy is exclusive and must be exhausted)
- Philips v. Pitt County Mem. Hosp., 222 N.C. App. 511, 731 S.E.2d 462 (N.C. Ct. App. 2012) (exhaustion doctrine inapplicable when administrative proceeding does not consider the remedy sought)
- Estate of Fennell v. Stephenson, 137 N.C. App. 430, 528 S.E.2d 911 (N.C. Ct. App. 2000) (adequacy of state remedy measured by whether it would compensate for the same injury)
- Christie v. Hartley Constr., Inc., 367 N.C. 534, 766 S.E.2d 283 (N.C. 2014) (limitations accrual generally when plaintiff is injured or discovers injury)