*1 OF APPEALS IN THE COURT PRODS., INC. LEARY v. N.C. FOREST (2003)] [157 LEARY, PRODUCTS, INC., WOOD v. N.C. FOREST CANAL OLIVER WRIGHT Plaintiff LASITTER, WETHERINGTON, CORPORATION, JOSEPH CHRISTOPHER MOSES LEARY, WETHERINGTON, WETHERINGTON, T. BARBARA TAMMY MAMIE E. L. SR., LEARY, CLAGGETT, LEARY, LEE PATTIE MAMIE RUTH LEARY ELMER LEARY, SR., GRISSOM, LEARY, M. SANDRA LEARY LAURA LINWOOD RICHARD STATEN, ELLIOTT, ELLIOTT, LEARY HAROLD LEARY ALLEN R. SHIRLEY SMITH, LEARY, JR., LEARY, LEARY, ELMER LEE PATRICK L. J.R. RICHARD HANCOCK, LEARY, SMITH, LEE, AND THE LAWFIRM KENNETH ARLENE P. OF KING, Defendants LASITTER &
No. COA02-599 May 2003) (Filed 6 Judgments— 1. Enforcement execution sale — collateral faulty attack on notice sale confirmation — separate A debtor could not file a lawsuit to collat- erally confirming an an execution sale based on attack order correctly errors in the conduct of the and the action was dis- upon failure to a claim which relief could be missed for state disputed was not and continued even if granted. Jurisdiction plaintiff sale; therefore, the order did not receive notice of confirming the sale was not void and could not attack it separate in a lawsuit. allegation sufficiently specific
2. Fraud— — not A not allowed to attack an execution judgment debtor was conclusory in an action where his sale as fraudulent necessary supply particularity. allegations did not Attorneys— malpractice party 3. —third malpractice upon legal
A claim of based non-client third- correctly party liability dis- arising from an execution sale was missed for failure to state a claim which relief could be granted. allegation contained no that the law firm’s by plaintiff representation induced of its client action reliance on the law firm’s conduct. part. concurring part dissenting
Judge Bryant Appeal by plaintiff July by Judge W. from order filed 30 Duke, County Superior Court. Heard in the Court of Russell Jr. in Pitt January Appeals 21
IN THE COURT *2 ‘plaintiff-appellant pro W.Leary,
Oliver se. Lee, Lasitter, P.A., by Lasitter, D. Hancock and Moses for defendants-appellees Products, Inc., Lasitter, N.C. Forest Moses Joseph Wetherington, Christopher Wetherington, L. Tammy Wetherington, Lee, Hancock, King. Lasitter & Dees, Smith, Jarrett, Jones, Powell, by Tommy Dees & W. Jarrett, defendant-appellee Corporation. Canal Wood for Gregory P.A., James, Sutton, K. David C. for defendants- appellees Leary, Leary Claggett, T.Barbara Mamie Ruth Elmer Leary, wife, Leary, Lee Sr. and Pattie Leary, Linwood Richard Grissom, Sr., Leary Leary Elliott, Sandra Laura M. Allen R. Elliott, Shirley Staten, Leary, Leary, Harold Elmer J.R. Jr., L. Leary, Leary, Patrick Kenneth Smith and Richard wife Leary. P. E. Arlene Smith and Mamie GEER, Judge. July Wright Leary appeals an dismissing
Oliver order filed 30 complaint for state a claim which failure to relief can be appeal granted. primarily question This involves the whether a judg- collaterally separate ment debtor file a lawsuit to attack an order confirming an execution sale based on errors in the conduct of that Any judgment Wehold that challenge sale. he cannot. debtor to by appeal the confirmation order should have been from the order or original order a motion set aside the filed lawsuit. Products, (“N.C. November Inc. On defendant Forest CVD 1966 Forest”) judgment against obtained a case number 89 Wright Leary, apparently Oliver this case. Mr. did validity appeal challenge judg- and does not otherwise that May satisfy judgment, in order to ment. On that Pitt Leary’s County sheriff held a Mr. 1/13 two tracts of sale of interest January pursuant execution 1992. land to writ of issued on At Report regarding that there were no bidders. The sheriff filed May on 16 the sale deputy April 1993, clerk issued a second
On of court writ sheriff, stating $24,276.00 to the that was due and com- execution satisfy personal prop- manding the sheriff out of erty or, personal property could not be defendant if sufficient defendant. found, property belonging then out of real to the The writ exemptions.” noted that has waived of execution “debtor IN COURT OF APPEALS THE v. N.C. FOREST LEARY Property Report Real filed June In a Sale of Leary’s legal notice,” Mr. 1/13inter- that due and sheriff stated “after Christopher public L. auction on June 1993 to est was sold $100.00. According in this Wetherington Secretary Assistant for the case, Wetherington Mr. was the July 1993,the clerk of filed N.C.Forest. assistant creditor On that the directing the sale be confirmed and sheriff an order purchaser good sufficient deed. deliver Leary’s July 1993, conveying executed a Mr. On 6 the sheriff deed Wetherington. recited that the sheriff interest to deed 1/13 given first property public having auction “after no- had sold the *3 place sale, such advertised the of the time and and same tice according to law.” April quit- 1996, Wetherington Mr. and his wife executed a
On later, yearA on deed of the interest to N.C. Forest. 17June claim 1/13 quitclaim a 1997, N.C. Forest in turn executed deed defendants Leary. Leary, Leary, Jr., L. Patrick L. Elmer L. and Kenneth On Leary the defendants1 a timber deed November then executed Corporation rights (“Canal”) Canal the timber on the granting Wood years. property for 2'A Leary years filed four later on 10 October 2000 in this action Canal, County Superior Forest, Joseph against Court N.C.
Pitt Wetherington, Christopher Wetherington, Tammy Wetherington, L. Leary Lee, Hancock, defendants, King law firm of Lasitter and the firm”), “law and Moses Lasitter. (the and alleges (1) against
The claim Forest based on “a fraudulent sale in the arguably Wetheringtons trespass sale; (2) handling” against manner of the execution Sheriff’s malpractice removing plaintiff’s consent; (3) for timber without Canal third-party law firm lia- against Moses Lasitter and the for non-client “equitable” Leary bility; “promissory” against and fraud exception timber deed. With the of the executing defendants plaintiff’s claim, malpractice cause of action is derivative each invalid. that the execution sale was claim Leary siblings: Leary, Mamie E. 1. “The defendants” include mother Leary Leary, Sr., Leary, Leary, Claggett, Pattie T. Barbara Mamie Ruth Elmer Lee Leary Leary, Elliott, Sr., Grissom, M. Allen R. Linwood Richard Sandra Laura Smith, Jr., Shirley Staten, Leary, Leary, Elliott, Elmer Lee Harold J.R. Richard Leary, Leary, and Arlene P. Smith. Patrick L. Kenneth
IN THE COURT
LEARY N.C. FOREST respect With against to his claim N.C. Forest plaintiff Leary Wetheringtons, alleged: rights by
39. [plaintiffs property] conveyed interests and [A]ll process” . . . inwas violation of “due of law. [the sheriff] Defendant, 40. Products, request presented N.C. Forest Inc.’s property to sale .. . was a fraudulent sale as [the sheriff] [sic] grossly price, result its low sale ($100.00), Hundred Dollars agent “Judgment an Products, Creditor” Forest [N.C. Inc.] purchased “Sale,” the amount of the debt TWENTYFOUR THOUSANDTWO HUNDRED AND SEVENTY- FIVE DOLLARS ($24,275.00) and NO/100 bid[] “Sale”, requirements and “Notice” set forth in G.S. 1-339.54of North Carolina General Statutes were not followed. plaintiff, Leary, Wright Oliver owns one-thirteenth
(l/13th) undivided property remainderman’s interest in fee of the sold ... [the sheriff].
42. Plaintiff alleges Products, Inc. Forest “defrauded” [sic] [plaintiff] (l/13th) his one-thirteenth interest... its conduct of “Sale”as inadequate fraudulent action as a result of the grossly price, agent Products, Inc[.], sale an of N.C. Forest son and son’s purchased Christopher Wetherington wife at the is the Secretary Inc., Assistant for N.C. Products, Forest and “Notice” *4 requirements by set forth 1-339.54 not N.C.G.S. followed [were] Products, N.C. Forest Inc. malpractice claim, attorney plaintiff
As to the stated Moses Lasitter and firm the law justification knowingly
without and . . . a committed fraudulent prerequisite procedural steps act the following in their Inc., to their Products, requesting client N.C. Forest advi[c]e plaintiff’s sheriff sale of . . . property one-thirteenth interest and sale, therefore, injury the manner of the to causing [plaintiff]. prayer relief, plaintiff superior In his to seeks have the court Leary sale; set aside the sheriff’s to recover from the defendants and Canal fair of the market value timber and trees removed from the land pursuant the to timber deed and to have that amount trebled as to the Canal; compen- defendants and recover doubled as to and to punitive satory damages Forest, Wetheringtons, and from N.C. claims, plaintiff firm. support the law of attached to the IN THE 400 COURT App. 396 copies filed in CVD of
complaint documents various an affi- pertinent 2000,plaintiff also submitted deeds. On November County stating court of Pitt that davit the assistant clerk of indi- 1966 had been searched and contained no court file 89 CVD had with notices “of the attached cation that been served May June ‘Report Property’ Real dated 1992 and of Sale of . . .” 1993. complaint Rule to dismiss the under
Defendants each moved upon granted can for failure to state a claim which relief be 12(b)(6) plaintiff attacking the con- grounds (1) on that: was barred from action; applicable (2) order in an statutes firmation run; of of laches barred (3) limitations had the doctrine purchaser claims; a bona fide for value without Canal was by its filed granted defendants’ motions order notice. The trial court July considering 12(b)(6) a motion to dismiss under Rule When “ whether, Procedure, question as of Civil for the court Rules ‘[t]he true, allegations complaint, treated as are law, matter of granted a claim which relief be under sufficient state ” theory, properly labeled or not.’ Grant Constr. legal some whether McRae, (quot Go. v. ing NCNB, 669, 670-71, Harris liberally complaint must and “should (1987)). construe appears beyond it that the not dismiss the unless doubt prove any support his claim which could not set facts County Person, entitle him to relief.” Block v. would This must conduct a de Court sufficiency and pleadings legal to determine their novo review of the ruling whether the trial court’s on the motion to dismiss determine correct. was
I [1] Defendants argue superior court action dis represents attack the clerk court’s it a collateral on missed because agree. of confirmation. We order *5 in Plaintiff confirmation was entered case 89 CVD1966. order suggests that he was argued nothing
has not and record any in other in 89 CVD1966 or that the district court served jurisdiction. Further, plaintiff challenged has not manner lacked incorpo- which validity execution, writ he judgment or the THE IN COURT PRODS., INC. v. N.C. FOREST
LEAKY
undisputed
these
complaint.
in
Because of
by reference
his
rated
authority
1-339.67to con-
§
under N.C. Gen. Stat.
facts, the clerk had
satisfy
judgment.
firm
execution sale conducted
void because
confirmation order was
Plaintiff contends that the
judicial
specified in N.C.
the actual
sale as
did not receive notice of
he
jurisdiction over the
If, however, a court has
Stat. 1-339.54.2
§
Gen.
authority
type
subject
and has
to enter
parties and the
matter
Sutton, 152 N.C.
issue,
is not void. Barton v.
then an order
order
judgment not
706, 708-09,
264,
(2002) (default
265-66
568 S.E.2d
statutorily-required
company that did not receive
void as to insurance
jurisdiction
personal
subject matter
had
notice because court
Freeman, 147
authority
judgment); Hamilton v.
to enter a default
a court has
App. 195, 204,
(2001) (“Where
questions
dispute
and has con
authority
to hear and determine
controversy,
issued
parties to the
trol over the
denied,
contrary
law.”), disc. review
void, even if
court is not
(quoting § N.C. Gen. property, an attachment of attack on question of a collateral gous “ prop- preliminary against execution as ‘a the Court described which ” action, had, in an erty.’ Edwards, of a property for satisfaction attachment of attacked the challenge case, did not but, plaintiff in this daughter, like against her attempted prove allegation Leary with an affidavit from Although Mr. merely court, not show that that the file does that affidavit states clerk of assistant reports two sales filed on copies the outcomes of the received of the sheriffs not Mr. to whether or May makes no reference 1993.The affidavit 1992and June in advance of the sale. received notice *6 IN THE COURT OF APPEALS (2003)] [157 jurisdiction the first court’s or judgment rendered in that court. jurisdiction This Court held that if a trial court has judg- to render a ment, ancillary resulting proceedings may then orders from not be collaterally attacked: may
A
judgment
directly
void
collaterally by
be attacked
or
any party adversely
thereby. However,
affected
in
original proceeding]
personal jurisdiction
had
and the judg-
[the
validity
ment
therein is valid notwithstanding the
of the at-
complained
contrary
tachment. Where the defect
of is
practice
course and
of the court but
non-jurisdictional,
is
judgment
irregular
voidable,
is
and is
but not void. Such a
judgment
parties
binding
on the
until corrected or
in
vacated
proper
manner.
Id. at
305 S.E.2d at
(citations omitted).
According to
Edwards,
proper
non-jurisdictional proce-
method of attack for a
ancillary
dural
in
defect
an
proceeding is “a motion in the cause.” Id.
applies equally
sale to the defendant’s estate. The
Court held that such a
properly
claim
brought
Superior
“was
before the
Court in a
motion
cause,
not an
action.” Id. at
IN THE COURT OF PRODS., INC. v. N.C. FOREST LEARY judicial sale, a second he receive notice of judgment debtor did not property). resale of the a motion in the cause for filed *7 HOA, Harris Real Inc. v. Dallas The dissent cites Inland Greens App. 610, (1997) S.E.2d 359 Estate-Construction, Inc., 127 N.C. 492 190, Bumpass, Roxboro v. and Board Comm’rs attack when there has supporting a collateral S.E.2d 144 as case, however, the lack of notice In each been a lack of notice. entity seeking judg- relief from the the individual or occurred because actually underlying action —in contrast to party a ment was not Greens, 127 N.C. debtor. Inland Mr. who was Bumpass, 195, at 63 S.E.2d at App. 361; at attack; party Moreover, in case did the make collateral neither proceed- by underlying they proceeded filing a motion instead Bumpass, in this See precisely plaintiff should have done case. ing, as property owner made a (unserved S.E.2d at 145-46 233 N.C. at and moved to vacate the order special appearance before the clerk Greens, 127 N.C. confirming sale); Inland motion). party 60(b) filed Rule (dismissed at 361 [2] Plaintiff has also alleged that the sale was fraudulent. Some deci by acquired fraud be chal that a suggested sions have Abernethy & Finance Co. v. First collaterally. See, e.g., Land lenged (1938) (“When the Co., 369, 372, 196 S.E. Sec. Trust ... is not based alleged setting judgment, aside a ground for [sale] cause.”). remedy motion in the proper is likewise fraud Miller, But Brown v. see collaterally independent action bring not
(1983) (plaintiff could required fraud; party was judicial grounds attacking sale on appeal from underlying action or a motion to the clerk make order). the clerk’s Procedure, aver- all the Rules of Civil 9(b)
Under Rule “[i]n . . . shall be constituting fraud ., fraud . . the circumstances ments of conclusory do not Leary’s allegations particularity.” Mr. stated with Dowd, 149 N.C. necessary particularity. Harrold v. supply See 9(b), plaintiff (under Rule App. 777, 782-83, fraudulent time, place, and content of the must, minimum, allege at a representation, identity person making of the representation, fraud). a result of the and what was obtained as juris- subject matter personal short, court had the district basis of the execu- judgment that was the it entered the diction when IN THE COURT Supreme longstanding precedent, Leary, tion sale. Court Under as properly-served defendant, required challenge to make inadequate if through that based on sale—even motion to notice— the clerk aside to set her confirmation of the sale. Mr. permitted independ- attack that order of in an confirmation ent action.
Defendants also assert are claims barred applicable statutes of limitations the doctrine of laches. Canal suing trespass further contends that is barred it from purchaser because it is a bona fide for value. Because we hold that plaintiffs exception malpractice claims—with the claim—all represent improper order, an collateral attack on the clerk’s we need not reach those issues.
II [3] Plaintiff argues that he sufficiently stated a malpractice claim for third-party liability. disagree. non-client We Carolina, professional In malpractice North claim be based privity on (1) third-party beneficiary of contract (2) or contract lia- bility. Leasing Corp. Miller, App. 400, United 45 N.C. 263 S.E.2d one, In plaintiff cases such as in which alleges this the nei- privity party beneficiary; ther that he nor was a third this Court has also claim negligence defendant, allowed a for if the entering into “ party, contract with another ‘placefd] has himself in such a rela- tion [plaintiff] impose toward that law will the him an obliga- tion, sounding contract, way tort and not in to act in such a that ’ ” [plaintiff] injured. will not be Id. at at 317 (quoting Industries, Co., App. Inc. v. 259, 271, Construction S.E.2d (1979)). party may
Whether a non-client third for an recover attor- ney’s malpractice theory depends under this alternative tort on sev- eral factors:
(1) the extent to which the transaction was intended to affect the party]; (2) foreseeability him; the (3) of harm degree the [third certainty injury; of that he suffered the closeness the con- [attorney’s] nection between the injury; conduct and the (5) the conduct; policy moral blame attached to the pre- such harm. venting future Leasing,
United 45 at 318.
IN THE COURT OF APPEALS As factor, to the first our generally courts have focused on attorney’s whether (or other professional’s) conduct, based on a agreement attorney’s contractual with client, was intended or likely to party cause a third to act reliance on the deficient serv- performed by ice attorney for his client. See Title Ins. Co. of Smith, Minn. v. Debnam, Pahl, Hibbert and 119 N.C. 805 (1995) (attorney party duty owed third of care
where he furnished a
plaintiff
title certificate to the non-client
purpose
inducing
plaintiff
policy
to issue a title
for the
benefit of
client),
part,
Judge WYNNconcurs. APPEALS OF IN THE COURT
406 v. FOREST LEARY N.C. 396 part. part and dissents BRYANTconcurs
Judge dissenting part. part BRYANT,Judge, concurring opinion upholding the majority fully in issue II of the I concur third-party malpractice plaintiffs non-client court’s dismissal trial plain- majority’s regarding holding claim; however, I dissent as to the collaterally he claims was void for ability attack an order that tiff’s lack of notice. plain- initially this Court that argue in their briefs to
Defendants entirety plaintiff’s claims turn complaint fail in its because tiff’s must setting sale and the aside procedures involved in the sheriff’s on the cannot be collat- and that this order confirmation order of the clerk’s point to support position, defendants erally of their attacked. Questor 501, DuBose, App. 612, 614, 265 S.E.2d 503 Corp. 46 N.C. v. collaterally plaintiffs could not in which this Court held (1980), subsequent judgment of con- and the clerk’s attack an execution sale plaintiffs was only available to the avenue firmation because out appeal. For the reasons set in the cause or direct either motion Questor distinguishable and does not control below, I is believe . this case. plaintiff is not entitled to is one in which a
A collateral attack
in an-
unless the
the relief demanded
Watson,
App. 58,
v.
is found to be invalid. Watson
other action
may be attacked
61,
542,
(1980).
“A void
270 S.E.2d
544
adversely
thereby.”
collaterally by any party
affected
directly or
App. 524, 529,
S.E.2d
Cabinets,
v. Brown’s
Edwards
in an
or
Hence, a “collateral attack
765,
(1983).
seeking relief from a
subsequent
permissible
means of
action is
jurisdiction.”
its face for lack of
order which is void on
judgment or
Auction,
App. 61,
Realty
v. Ben
Watson
Griffin
Stroupe
Stroupe, 301 N.C.
(1997); see
merely
however,
judgment,
If the
appeal
only
a direct
or
voidable, it
be attacked
irregular, i.e.
can
Co.,
Montgomery Mut. Ins.
Daniels v.
motion in the cause. See
Edwards, N.C.
(1987);
contrary
complained of is
(“[w]here
the defect
non-jurisdictional,
judg-
practice
but is
of the court
course
*10
voidable,
void[,
and is
but not
irregular
ment is
s]uch
...
a motion in
or vacated
binding
parties
until corrected
on
cause”).
IN THE COURT OF APPEALS
App.
Questor
plaintiffs
The
in
sought to have the execution sale set
aside because
pay
the defendants “did not
Questor,
their bid in cash.”
614,
46 N.C.
at
both matter to enter the initial judgment in favor of N.C. Forest 89 CVD1966and the clerk of the superior possesses general statutory authority to enter a confirmation of the confirmation order in this case cannot be collaterally attacked argument ignores as void. This process that due requires the issuance aof notice of sale to a judgment debtor before property can be offered for sale. See N.C.G.S. 1-339.54(2001). § procedural step, Without this the clerk did authority not have the this case to issue a confirmation order consummating the sale. See N.C.G.S. 1-339.67 I § would further note that the factual bases by majority of the cases cited distinguishable, are see Henderson County Osteen, 692, 702-03, 292 N.C.
(where
notice,
the debtor did have
consequently
and the court
acquired jurisdiction,
subsequently
but the debtor
died and the
administrator of the estate did not receive additional notice of the tax
sale); Edwards,
63 N.C.
(where
(1913), Gardner, Bank v. (1940), *11 APPEALS IN THE COURT OF
STATE v. McCOLLUM 419, 424, Applewhite Co., & and Walston that the no statement are based on an unsubstantiated (1953) merely directory and not is requirement in section 1-339.54 tice mandatory. contrary express lan premise, however, is Such a notice to (mandating 1-339.54 guage § of the statute. See N.C.G.S. debtor). plaintiffs dismissing the trial court’s order Thus, to the extent a collateral attack on plaintiffs engagement of action was based on order, it should be reversed. the confirmation v. DAVID JEROME McCOLLUM STATE OF NORTH CAROLINA No. COA02-797 (Filed 2003) 6 May second-degree murder — failure to submit 1. Homicide— involuntary manslaughter offense of lesser-included plain first-degree error in a did not commit The trial court second-degree was convicted of murder case in which defendant offense of invol- by failing submit the lesser-included murder motu, (1) because: the failure to untary manslaughter ex mero impact jury’s finding that probable on the instruct did not have murder; error second-degree guilty defendant was rejection voluntary manslaugh- jury’s light harmless in second-degree murder since a defendant for ter and conviction of voluntary precludes finding of either finding of malice involuntary manslaughter. manslaughter or instruction Law— motion for mistrial —curative Criminal first-degree in a court did not abuse its discretion The trial when motion for a mistrial denying case defendant’s murder testimony gun case a was jury that in a later unrelated heard incident for which have been used at the seized which contrary argu- to defendant’s trial, was on because: defendant presented that defendant had committed ments, no evidence issue; (2) the trial charge at murder in addition to the another testimony, objections, struck the sustained defendant’s showing that instruction, has been no and there gave a curative court to dis- of the trial jury failed to follow the instructions testimony. regard the
