Plaintiff, Sentry Enterprises, Inc., is a closely-held North Carolina corporation located in Onslow County. In 1984, the time *295 material to this action, it had a total of three shareholders who also served as corporate officers: Daniel Furia, Secretary-Treasurer; Charles J. Scozzari, President; and Bernardo Navarro, Vice-President. Mr. Furia, who resided in New Jersey, exercised authority for Mr. Navarro, who lived in South America, through a power of attorney. Mr. Scozzari was the only shareholder/director residing in Onslow County. Mr. Scozzari managed plaintiffs daily business. As president, Mr. Scozzari was authorized to accept payment and to accept, endorse, and negotiate checks on plaintiffs behalf.
In 1984, plaintiff began development of real property located in Onslow County. Defendant Canal Wood, a North Carolina corporation engaged in the business of buying and selling timber, cut timber off plaintiffs land. It is the cutting of that timber which gave rise to this legal action.
On 9 March 1984, Mr. Scozzari and defendant entered into a Timber Purchase and Sales Agreement giving defendant Canal Wood the right to cut and remove timber from plaintiffs land in Onslow County. The contract was signed “C. J. Scozzari,” and it listed Mr. Scozzari as “SELLER.” Defendant Canal Wood hired defendant Goodson to cut and remove timber from plaintiffs land. Defendant Goodson started cutting and removing timber in March, 1984, and completed the work in June, 1984. Defendant Canal Wood made payments totaling $69,938.91 — the total due under the agreement — to Mr. Scozzari, with checks bearing his name as payee. Mr. Scozzari converted the payments made by defendant and other funds to his own use. In a separate action, plaintiff obtained a consent judgment against Mr. Scozzari and received $119,040.55 in payment thereof from him.
On 3 September 1986, plaintiff filed suit against Canal Wood, Goodson, and Donnell Moseley, the broker who brought plaintiff and Canal Wood together. The suit alleged that defendants, acting in concert, trespassed on plaintiffs land and converted the timber to their own use. Defendants answered and moved for summary judgment on plaintiffs trespass action. On 27 October 1987, the trial court filed an order granting summary judgment for defendants Canal Wood and Goodson. In that same order, the trial court, on its own motion, gave plaintiff 20 days to file and serve an amended complaint. On 13 November 1987, plaintiff filed an “amendment to complaint,” wherein plaintiff alleged that plaintiff and defendant Canal Wood entered into a contract for the purchase of *296 timber from plaintiff and that Canal Wood cut and removed the timber from plaintiffs property. Plaintiff alleged that defendant Canal Wood paid Mr. Scozzari $69,938.91 and that defendant was negligent in paying Mr. Scozzari individually rather than the plaintiff. After answering the amended complaint, defendant Canal Wood moved for summary judgment. Defendant Goodson filed a motion to dismiss for failure to state a claim against him. On 15 February 1988, the trial court granted defendant Canal Wood’s motion for summary judgment and granted defendant Goodson’s motion to dismiss. Plaintiff timely gave notice of appeal to the 15 February order granting summary judgment for defendant Canal Wood. Plaintiff did not appeal the dismissal as to defendant Goodson, and plaintiff has taken a voluntary dismissal as to defendant Moseley. Thus, the only parties before this Court in this appeal are plaintiff and the defendant corporation.
On appeal, plaintiff contends (1) that the trial court erred in granting summary judgment on 27 October 1987 as to the trespass claim, and (2) that the trial court erred in granting summary judgment on 15 February 1988 as to the negligence claim. In a cross assignment of error, defendant contends the trial court erred in allowing the plaintiff to amend his complaint. We find no merit to plaintiff’s contentions regarding summary judgment. We agree with defendant that the trial court erred in allowing plaintiff to amend the complaint after summary judgment.
The first assignment of error presented in plaintiff’s brief contends that the trial court erred in granting defendant’s motion for summary judgment on 27 October 1987. In the argument thereunder, plaintiff contends that “the central issue in this case is whether it was negligent for Canal Wood ... to contract for the purchase of the timber to make payments for the timber to C. J. Scozzari, instead of [plaintiff].” Plaintiffs argument is misplaced. When the trial court entered summary judgment for Canal Wood on 27 October 1987, the only claim before the court was plaintiff’s claim for trespass. Plaintiff’s claim for negligence did not arise until the amended complaint was filed on 13 November 1987. Thus, the only issue pertinent to the 27 October 1987 summary judgment is whether there is any genuine issue of material fact as to plaintiff’s claim for trespass. See N.C. Gen. Stat. § 1A-1, Rule 56(c) (1988).
In its brief, plaintiff fails to distinguish between the two orders granting summary judgment. Nonetheless, we have reviewed the *297 record below and find that the trial court was correct in granting summary judgment for defendant Canal Wood on the trespass claim.
To prove trespass plaintiff must show that defendant made an unauthorized entry on plaintiff’s land.
Keziah v. Seaboard Air Line R.R. Co.,
“Where a third party in good faith and with reasonable prudence deals with an agent having apparent authority, the principal is bound by the agent’s acts.
Thompson v. Assurance Society,
The timber agreement plaintiff’s president made with defendant Canal Wood was in the ordinary course of plaintiff’s business. Daniel Furia, currently plaintiff’s president, was one of plaintiff’s three shareholders and was plaintiff’s secretary-treasurer at the time the timber was cut. Mr. Furia testified in deposition that plaintiff desired to develop the land in Onslow County as a subdivision. He stated that plaintiff wanted the land cleared and had authorized Mr. Scozzari to clear it. Mr. Furia testified that plaintiff’s officers, directors and shareholders knew timber was being cut and removed from their land and knew defendant Canal Wood was cutting and removing that timber. Neither the officers, direc *298 tors nor shareholders of plaintiff objected at any time to the timber being cut and removed. Since the cutting and removal of timber was in the ordinary course of plaintiff’s business — the development of a subdivision — and since plaintiff had authorized the president to clear the land, plaintiff’s president had the apparent authority to bind plaintiff corporation to the timber agreement with defendant. We find the trial court was correct in granting defendant’s motion for summary judgment on the trespass claim.
We now turn to defendant’s cross assignment of error wherein the defendant alleges the trial court erred in allowing the plaintiff to amend the complaint after entry of summary judgment. We hold that the trial judge had no authority to grant leave to amend after summary judgment was entered against plaintiff.
This Court has held that once a Rule 12(b)(6) motion is granted, the trial court is “no longer empowered to grant plaintiff leave to amend under Rule 15(a) . . . .”
Johnson v. Bollinger,
Michael Marks, defendant’s manager, testified in deposition as to the reason for writing checks in Mr. Scozzari’s name:
A. He said he was the President of the company. He said he owned the company and he needed the money wrote [sic] in his name so he could pay out tractor bills and bulldozer bills or whatever what [sic] to begin clearing land.
* * * *
Q. Is it your practice to pay corporations by making checks directly to an office manager or the president?
A. I feel like if it’s deemed necessary, if they request it, I feel like they own the timber, or they own whatever, and I try to oblige them as necessary and he made that request, he as in Mr. Scozzari.
Plaintiff has produced no evidence that defendant knew of any improper purpose in Mr. Scozzari’s asking that checks be written in his name. “No duty rests upon a debtor, who makes a payment to an agent designated to receive it, to see that the money reaches the principal, if the debtor is without notice of an improper purpose or intention on the part of the collecting agent.
Shriver v. Sims,
While it is generally recognized that an agent having authority to collect a debt has no authority to receive a check in payment, it is nevertheless held that, where he cashes the check and receives the money thereon, the principal is bound. Kloewer v. Associates Discount Corp.,245 Iowa 373 ,62 N.W. 2d 244 (1954); Restatement of the Law, Agency, s. 178; 3 Am. Jur., 2d Agency, s. 139, pp. 531, 532;94 A.L.R. 786 . Checks made payable to the order of an agent, which are cashed by him, are not different from payments made in cash so far as the legal effect of the transaction is concerned. Zummach v. Polasek,199 Wis. 529 ,227 N.W. 33 (1929).
Id.
at 477,
*300 We conclude, therefore, that summary judgment for defendant would have been correct on the negligence claim if that claim were properly before the court.
In summary, the portion of the 27 October 1987 order granting summary judgment for defendant is affirmed; the portion of the order granting plaintiff leave to amend the complaint is reversed. Summary judgment for defendant, including dismissal of the action with prejudice, is affirmed.
Affirmed in part; reversed in part.