Van-Go Transp., Inc. v. Sampson Cnty.
254 N.C. App. 836
| N.C. Ct. App. | 2017Background
- Van-Go and EnRoute both bid for a county Medicaid-transportation contract; County awarded the contract to EnRoute. Van-Go filed suit and obtained a temporary restraining order (TRO) enjoining EnRoute from performing; Van-Go posted a $25,000 injunction bond.
- The superior court later dissolved the TRO and denied a preliminary injunction. Defendants removed to federal court then the case was remanded after Van-Go amended to remove federal claims.
- While EnRoute’s motion to dismiss was pending, Van-Go unconditionally and voluntarily dismissed the action without prejudice and later moved for return of the $25,000 bond.
- EnRoute and the County moved to recover the bond proceeds, claiming they were wrongfully enjoined and suffered specific monetary losses during the roughly 20-day TRO period.
- Trial court found Van-Go’s unstipulated voluntary dismissal was equivalent to an admission that the TRO had been wrongfully issued and awarded the bond proceeds: $15,993.57 to EnRoute (lost profits) and $9,006.43 to the County (excess payments).
- Van-Go appealed, arguing (1) the bond should be returned because the voluntary dismissal did not equate to an admission; (2) EnRoute’s lost-profit evidence was insufficient; and (3) the County lacked a right to the funds because the money originated with the State.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether an unstipulated voluntary dismissal bars return of the injunction bond / is equivalent to judicial finding of wrongful injunction | Van-Go: dismissal followed denial of preliminary injunction and was a business decision (mootness/"constructive mootness"); therefore Blatt rule should not apply | Defendants: an unconditional voluntary dismissal is equivalent to admitting the injunction was wrongful under Blatt; bond is payable | Held: Unconditional voluntary dismissal equates to admission the injunction was wrongfully issued (Blatt controlling); mootness exception in narrow situations not met here — affirm award |
| Whether EnRoute proved lost profits with reasonable certainty to recover portion of bond | Van-Go: EnRoute’s damage calc (costs $0.72/mi) was speculative, relied on post-TRO months and unsupported affidavit | EnRoute: lost revenue computed from contract rate and actual miles; avoided variable costs shown by owner’s affidavit; trial court credited affidavit | Held: Owner’s affidavit provided sufficient basis; damages not speculative given known miles and contract rate; award to EnRoute affirmed |
| Whether County could recover excess payments when funds originated from State | Van-Go: County was merely conduit for State funds and lacks right/duty to recoup; thus no compensable injury to County | County: paid higher amounts because of TRO and therefore suffered actual damages regardless of funding source | Held: County suffered compensable loss (paid $1.85 vs $1.54/mi for 29,053 miles); origin of funds irrelevant to County’s right to recover |
Key Cases Cited
- M. Blatt Co. v. Southwell, 259 N.C. 468 (1963) (voluntary, unconditional dismissal treated as confession that plaintiff was not entitled to equitable relief)
- Democratic Party of Guilford County v. Guilford County Bd. of Elections, 342 N.C. 856 (1996) (mootness can render dismissal a legal nullity and bar automatic application of Blatt)
- Indus. Innovators, Inc. v. Myrick-White, Inc., 99 N.C. App. 42 (1990) (purpose of injunction bond is to make plaintiff bear risk of damages caused by provisional relief)
- Allen Indus., Inc. v. Kluttz, 788 S.E.2d 208 (N.C. Ct. App. 2016) (application of mootness exception where injunction period expired)
- Weyerhaeuser Co. v. Godwin Bldg. Supply Co., 292 N.C. 557 (1977) (lost profits cannot be awarded when speculative)
- United Leasing Corp. v. Guthrie, 192 N.C. App. 623 (2008) (lay opinion testimony can suffice to establish value when witness has basis for opinion)