Peters v. Pennington, 210 N.C. App. 1

Background

Peters and Pennington, both doctors, married in 1997 with two sons; separation in 2005 and a separation agreement providing joint custody; divorce granted in 2006 but not incorporated into the separation agreement.
Following an initial period of cooperation, disputes over medical care and education led to a 2007 consent order addressing asthma care, bedtimes, school prep, and a non-disparagement clause; the consent order acknowledged joint custody but did not incorporate the separation agreement.
Pennington filed multiple motions beginning in 2007–2008 seeking custody and restricted visitation; in 2008 the court issued ex parte orders limiting Peters’ visitation and appointing a guardian ad litem; a two-week complex trial occurred in 2009.
The trial court ultimately found Pennington inflicted emotional/physical harm on the children by making false abuse claims, awarded Peters permanent sole physical and legal custody with temporary medical-decision-making shared custody, and ordered Pennington to undergo therapy; Pennington and her counsel (Burns) pursued post-judgment motions, with Rule 11 sanctions against Burns.
The 6 March 2009 custody order and the 20 May 2009 costs order were appealed; the appellate court affirmed in part, vacated in part (including certain therapy-related decretal provisions and non-attorney costs), and remanded for further proceedings on remediable issues and to address sanctions.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Did the court apply the proper framework to modify custody?	Pennington argues no substantial change in circumstances was shown and the consent order incorporated the separation agreement.	Peters contends the best-interests analysis was proper and substantial-change was not required for certain temporary aspects; the court could proceed to best interests.	Yes; the court used best-interests analysis; the separation agreement was not incorporated, so modification did not require a prior substantial-change finding.
Were the trial court’s findings sufficient to support the custody and abuse conclusions?	Pennington contends findings do not support causation of harm or abuse conclusions.	Peters argues findings are supported by the evidence.	Most findings up to causation are supported; the court’s conclusion that Pennington caused harm is sustained, but finding 30 about DSS abuse was vacated on remand.
Was the visitation restriction lawful and properly delegated?	Pennington contends the restriction effectively terminates visitation and lacks proper standard.	Peters notes therapeutic visitation is allowed and neutral professionals oversee it; overall structure is permissible.	visitation framework is permissible with neutral-therapist oversight; not a total termination of visitation.
Are the costs and attorney’s fees properly awarded and taxed?	Pennington challenges uninsured therapy costs, large attorney-fee award, and interest on costs.	Peters asserts reasonableness and statutory authorization for costs and fees; interest on costs should be disallowed.	Costs require statutory authorization; vacate interest on costs and remand to determine certain non-attorney costs; affirm most attorney-fee awards with remand for precise accounting.
Did the Rule 11 sanctions against Burns survive appellate review?	Pennington challenges sanctions as misapplied.	Burns violated by mischaracterizing the record and failing to verify statements.	Rule 11 sanctions against Burns affirmed; the court found credible misstatements and improper conduct.

Key Cases Cited

Everette v. Collins, 176 N.C.App. 168, 625 S.E.2d 796 (2006) (substantial evidence standard in custody appeals; findings binding if supported)
Moore v. Moore, 160 N.C.App. 569, 587 S.E.2d 74 (2003) (clear and convincing standard for termination-like visitation restrictions)
Diehl v. Diehl, 177 N.C.App. 642, 630 S.E.2d 25 (2006) (distribution of decision-making authority in custody cases; deference to trial court findings)
Arriola v. Evans, 160 N.C.App. 671, 586 S.E.2d 809 (2000) (substantial-change-in-circumstances framework for custody modification)
Cox v. Cox, 133 N.C.App. 221, 515 S.E.2d 61 (1999) (physician-supervised visitation as a justified structure in custody orders)