Cencomp, Inc. v. Webcon, Inc.

579 S.E.2d 482, 157 N.C. App. 501, 2003 N.C. App. LEXIS 731, 2003 WL 21003674
CourtCourt of Appeals of North Carolina
DecidedMay 6, 2003
DocketNo. COA02-924
StatusPublished

This text of 579 S.E.2d 482 (Cencomp, Inc. v. Webcon, Inc.) is published on Counsel Stack Legal Research, covering Court of Appeals of North Carolina primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Cencomp, Inc. v. Webcon, Inc., 579 S.E.2d 482, 157 N.C. App. 501, 2003 N.C. App. LEXIS 731, 2003 WL 21003674 (N.C. Ct. App. 2003).

Opinion

CALABRIA, Judge.

Plaintiffs, Cencomp, Inc., d/b/a Phillips Iron Works and Ted Cihos d/b/a Phillips Iron Works (collectively “Phillips”), were subcontractors of defendant Webcon, Inc. (“Webcon”) on a construction project related to a sewer line for the City of Roxboro (“the City”). Defendant International Fidelity Insurance Company (“Fidelity”) was the payment bond surety on the project.

On 11 December 2000, Phillips filed suit against Webcon asserting breach of contract and quantum meruit claims, and against Webcon and Fidelity asserting a payment bond claim pursuant to N.C. Gen. Stat. § 44A-26 (2001). The court granted Fidelity’s motion for summary judgment, finding the suit was time-barred because: (1) N.C. Gen. Stat. § 44A-28(b) required Phillips file its claim on the bond within one year after the City and Webcon reached a “final settlement;” (2) a final settlement occurred on 21 September 1999; and (3) Phillips’ suit was not filed until 11 December 2000, more than one year later. The court then granted Webcon’s motion for a change of venue because without Fidelity there was no basis for venue in Person County. Phillips appeals.

“The order of the superior court granting the defendant’s motion for summary judgment did not dispose of all the claims in the case, making it interlocutory.” DKH Corp. v. Rankin-Patterson Oil Co., 348 N.C. 583, 584, 500 S.E.2d 666, 667 (1998). Although an interlocutory order is ordinarily not immediately appealable, an interlocutory order may be immediately appealed if it affects a substantial right. N.C. Gen. Stat. §§ l-277(a) and 7A-27(d)(l) (2001). Phillips asserts a substantial right “to have the case heard in Person County and to have the liability of all Defendants determined in one proceeding” will be lost without appellate review. “ ‘The right to avoid the possibility of two trials on the same issues can be ... a substantial right’ that permits an appeal of an interlocutory order when there are issues of fact common to the claim appealed and remaining claims.” Phillips v. [503]*503Restaurant Mgmt. of Carolina, L.P., 146 N.C. App. 203, 207, 552 S.E.2d 686, 689, disc. review denied, 355 N.C. 214, 560 S.E.2d 132 (2001) (quoting Green v. Duke Power Co., 305 N.C. 603, 608, 290 S.E.2d 593, 596 (1982)). Here, the summary judgment disposed of only the claim on the payment bond against Fidelity, and remaining claims against Webcon include claims on the payment bond, breach of contract, and quantum meruit. Since the claims against Webcon remain and there are common issues of fact, we find Phillips properly asserted a substantial right and appealed the interlocutory summary judgment order against Fidelity.

Phillips asserts the trial court erred by: (I) determining no genuine issue of material fact existed as to whether a “final settlement” was reached between Webcon and the City in September 1999; and (II) ordering venue be transferred.

I. Summary Judgment

“Summary judgment is properly granted when the pleadings, depositions, answers to interrogatories, admissions and affidavits show no genuine issue of material fact exists, and the movant is entitled to judgment as a matter of law. . . . [T]he evidence is viewed in the light most favorable to the non-movant.” Bostic Packaging, Inc. v. City of Monroe, 149 N.C. App. 825, 830, 562 S.E.2d 75, 79, disc. review denied, 355 N.C. 747, 565 S.E.2d 192 (2002). Since the trial court granted Fidelity summary judgment on the basis that Phillips failed to file its complaint within the allotted time restrictions provided for by N.C. Gen. Stat. § 44A-28(b), the issue for this Court is whether, in the light most favorable to Phillips, a genuine issue of material fact exists regarding the timeliness of the complaint.

North Carolina law provides:

No action on a payment bond shall be commenced after the expiration of the longer period of one year from the day on which the last of the labor was performed or material was furnished by the claimant, or one year from the day on which final settlement was made with the contractor.

N.C. Gen. Stat. § 44A-28(b) (2001). This statute is a statute of repose and a condition precedent, therefore, plaintiff has the burden of proving its cause of action was brought within the one-year time period. Tipton & Young Construction Co. v. Blue Ridge Structure Co., 116 N.C. App. 115, 118, 446 S.E.2d 603, 605 (1994). If plaintiff fails to meet its burden, “ ‘plaintiff’s case is insufficient as a matter of law[,]’ ” and [504]*504summary judgment for defendant is proper. Id., (quoting Chicopee, Inc. v. Sims Metal Works, 98 N.C. App. 423, 426, 391 S.E.2d 211, 213 (1990)).

Phillips asserts it met its burden and complied with the statute because the settlement reached between Webcon and the City in September 1999 was not a “final settlement” since the City retained approximately $50,000.00. Defendants disagree asserting that on 21 September 1999 the City determined the “final settlement” and therefore Phillips’ claim against Fidelity is barred by the one-year statute of repose.

The meaning of the term “final settlement,” originally a federal term from the 1905 Heard Act and later the 1935 Miller Act, “was litigated extensively and caused considerable uncertainty in the construction industry. In 1959, Congress abandoned the term[.]” Safeco Ins. Co. of America v. Honeywell, Inc., 639 P.2d 996, 1000 (Alaska 1981). Unlike Congress, our state legislature has not abandoned the term.

When interpreting the meaning of “final settlement,” our courts turn to federal law for guidance. Pyco Supply Co., Inc. v. American Centennial Ins. Co., 85 N.C. App. 114, 354 S.E.2d 360 (1987), rev’d on other grounds, 321 N.C. 435, 364 S.E.2d 380 (1988). In Pyco, this Court quoted the seminal United States Supreme Court decision, Illinois Surety Co. v. U.S. to the use of Peeler, et al., 240 U.S. 214, 60 L. Ed. 609 (1915), in which,

the [United States Supreme] Court held that final settlement occurred when, so far as the government was concerned, the amount which it was bound to pay was administratively fixed by the proper authority. . . . [And the Court explained t]he date of the final settlement does not depend upon the contractor’s agreement and must be clear, readily ascertainable and occur at a definite time.

Pyco, 85 N.C. App.

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Related

Illinois Surety Co. v. United States Ex Rel. Peeler
240 U.S. 214 (Supreme Court, 1916)
Pyco Supply Co. Inc. v. American Centennial Ins. Co.
354 S.E.2d 360 (Court of Appeals of North Carolina, 1987)
DKH CORP. v. Rankin-Patterson Oil Co.
500 S.E.2d 666 (Supreme Court of North Carolina, 1998)
Chicopee, Inc. v. Sims Metal Works, Inc.
391 S.E.2d 211 (Court of Appeals of North Carolina, 1990)
Phillips v. Restaurant Management of Carolina, L.P.
552 S.E.2d 686 (Court of Appeals of North Carolina, 2001)
Bostic Packaging, Inc. v. City of Monroe
562 S.E.2d 75 (Court of Appeals of North Carolina, 2002)
Tipton & Young Construction Co. v. Blue Ridge Structure Co.
446 S.E.2d 603 (Court of Appeals of North Carolina, 1994)
Green Ex Rel. Downs v. Duke Power Co.
290 S.E.2d 593 (Supreme Court of North Carolina, 1982)
Pyco Supply Co. v. American Centennial Insurance
364 S.E.2d 380 (Supreme Court of North Carolina, 1988)
Safeco Insurance Co. of America v. Honeywell, Inc.
639 P.2d 996 (Alaska Supreme Court, 1981)
Zimmerman's Electric, Inc. v. Fidelity & Deposit Co.
231 N.W.2d 342 (Nebraska Supreme Court, 1975)
Pitts v. American Sec. Ins.
560 S.E.2d 132 (Supreme Court of North Carolina, 2002)
Phillips v. Restaurant Mgmt. of Carolina, L.P.
355 N.C. 214 (Supreme Court of North Carolina, 2001)

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Bluebook (online)
579 S.E.2d 482, 157 N.C. App. 501, 2003 N.C. App. LEXIS 731, 2003 WL 21003674, Counsel Stack Legal Research, https://law.counselstack.com/opinion/cencomp-inc-v-webcon-inc-ncctapp-2003.