DuBose v. Gastonia Mutual Savings & Loan Ass'n

286 S.E.2d 617, 55 N.C. App. 574, 1982 N.C. App. LEXIS 2248
CourtCourt of Appeals of North Carolina
DecidedFebruary 2, 1982
DocketNo. 8127SC298
StatusPublished
Cited by5 cases

This text of 286 S.E.2d 617 (DuBose v. Gastonia Mutual Savings & Loan Ass'n) 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
DuBose v. Gastonia Mutual Savings & Loan Ass'n, 286 S.E.2d 617, 55 N.C. App. 574, 1982 N.C. App. LEXIS 2248 (N.C. Ct. App. 1982).

Opinion

BECTON, Judge.

PROCEDURAL AND FACTUAL HISTORY

The resolution of this appeal, though simple, requires a painstaking review of transactions that have spawned several other lawsuits, some of which have reached the appellate courts.1

On 30 May 1978, A. C. Burgess, Jr. gave a promissory note to defendants in the amount of $56,000.00. The promissory note was secured by a deed of trust encumbering five residential lots that Burgess personally owned. Burgess ultimately defaulted on the obligation and a foreclosure proceeding was initiated by defendants by the filing on 12 October 1979 of a Notice of Hearing before the Clerk of Court of Gaston County. Significantly, at the time of the 7 November 1979 hearing in this matter, the plaintiffs had received and recorded a sheriff’s deed dated 14 February 1979 to the five lots that are the subject of this lawsuit.

[576]*576Following the 7 November 1979 hearing, the Gaston County Clerk entered an order authorizing defendants to foreclose in accordance with their deed of trust. That order was subsequently affirmed by the Gaston County Superior Court and by this Court in In Re Foreclosure of Burgess, 47 N.C. App. 600, 267 S.E. 2d 915 (1980). Although the dispositive issue in In Re Foreclosure of Burgess involved “the scope of the procedures under G.S. 45-21.16 for hearing prior to the exercise of a power of sale under a deed of trust,” id. at 602, 267 S.E. 2d at 917, we suggested in that case that plaintiffs might have been entitled to injunctive relief. Specifically, we said:

Having received the notice and hearing intended by the statute, [plaintiffs] are now able to utilize the procedure of G.S. 45-21.34 to enjoin the mortgage sale “upon [any] legal or equitable ground which the court may deem sufficient.” If and when [plaintiffs] choose to apply for injunctive relief, the dispute over the balance due on the note and deed of trust and the manner in which the balance was computed will certainly be relevant to the issue of [plaintiffs’] right to relief. As to the title dispute, we note that the 12 October 1979 order of superior court declaring the sheriffs deed to DuBose and Bernhardt null and void was reversed by this Court in Questor Corp. v. DuBose, 46 N.C. App. 612, 265 S.E. 2d 501 (1980) and the cause was remanded with direction to dismiss the action challenging the validity of that deed.2

Id. at 600, 267 S.E. 2d at 918.

On 9 September 1980, defendants filed another Notice of Foreclosure. On 2 October 1980, the plaintiffs, following this Court’s suggestion in In re Foreclosure of Burgess, filed their complaint seeking injunctive relief pursuant to G.S. 45-21.34. Plaintiffs contended that the defendants’ 9 September 1980 renewed notice of sale should be enjoined and alleged (1) that there was a dispute over the title to the property, over the [577]*577balance due under the note, and over the monthly payments due under the note; (2) that the interest rate on the amount owed of 9% compounded monthly was usurious; and (3) that they would suffer irreparable harm if defendants were not enjoined from exercising the power of sale.

Plaintiffs were initially granted a temporary restraining order on 2 October 1980. However, when the motion for injunc-tive relief was heard on 3 November 1980, Judge Ferrell entered an Order dissolving the temporary restraining order and denying plaintiffs’ motion for a preliminary injunction. From this order, plaintiffs appeal to this Court. Significantly, following plaintiffs’ notice of appeal, the foreclosure sale was completed on 27 February 1981, at which time a trustee’s deed conveyed the subject property to Billy Cline.

Issue

The issue: Did the trial court err in dissolving the temporary restraining order and in denying plaintiffs’ motion for a preliminary injunction thereby allowing defendant to consummate the sale of the land under a power of sale contained in a deed of trust?

The answer: No.

Although plaintiffs argue that the “gravamen of this case is the irreparable harm to plaintiffs by permitting the exercise of a power of sale while the title and the balance due are in controversy,” we are not persuaded that plaintiffs have established that they are entitled to the injunctive relief they request. We reach this conclusion after having considered the scope of our review and having balanced plaintiffs’ right, based on case law and statute, to enjoin the sale of land in which they claim an interest, against defendant’s contractual right to foreclose in accordance with the terms of a note and deed of trust.

Analysis

Ordinarily, the granting of injunctive relief lies in the sound discretion of the court. Huggins v. Board of Education, 272 N.C. 33, 157 S.E. 2d 703 (1967); Conference v. Creech and Teasley v. Creech and Miles, 256 N.C. 128, 123 S.E. 2d 619 (1962); Lance v. Cogdill, 238 N.C. 500, 78 S.E. 2d 319 (1953). And “[w]hile this [578]*578Court, upon an appeal from the granting or denial of a temporary-injunction, is not bound by the findings of fact in the court below, and may review the evidence and make its own findings of fact, the burden is upon the appellant to show error by the lower court.” 272 N.C. at 41, 157 S.E. 2d at 708.

Even absent a statute, our courts have “the power to restrain the exercise of the power of sale under a mortgage or a deed of trust where a sale thereunder would work an injustice to the rights of [those] interested in the property [if] there should be some equitable element involved, as fraud, mistake, or the like.” Sineath v. Katzis, 219 N.C. 434, 440, 14 S.E. 2d 418, 421 (1941). See also Investors, Inc. v. Berry, 293 N.C. 688, 239 S.E. 2d 566 (1977). And, by statute, any person having a legal or equitable interest in land may, prior to the confirmation of any sale of the land by a mortgagee or trustee, enjoin such sale “upon the ground that the amount bid or price offered therefor is inadequate and inequitable and will result in irreparable damage to the owner or other interested person, or upon any other legal or equitable ground which the Court may deem sufficient. . . .” G.S. 45-21.34 (emphasis added).

In this case, plaintiffs seek to utilize the procedures of G.S. 45-21.34 to enjoin the foreclosure sale. Plaintiffs have had the hearing contemplated by statute and have, in our view, (1) failed to establish probable cause showing that they could ultimately prevail in a final determination, and (2) failed to establish a reasonable apprehension of irreparable loss to them unless injunc-tive relief is granted. See Waff Bros. v. Bank, 289 N.C. 198, 221 S.E. 2d 273 (1976); Service Co. v. Shelby, 252 N.C. 816, 115 S.E. 2d 12 (1960).

Significantly, plaintiffs did not allege that the deed of trust contained no foreclosure provision or that the deed of trust was not in default. Upon allegations relating primarily to an alleged controversy affecting title to the property, plaintiffs prayed for injunctive relief only. When the sole purpose of the action is to obtain injunctive relief, the trial court properly may dissolve the temporary restraining order and dismiss the action when the movant fails to present facts entitling him to relief. Compare Rheinhardt v. Yancey, 241 N.C. 184, 84 S.E. 2d 655 (1954) (court properly dissolved restraining order and dismissed the action

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Cite This Page — Counsel Stack

Bluebook (online)
286 S.E.2d 617, 55 N.C. App. 574, 1982 N.C. App. LEXIS 2248, Counsel Stack Legal Research, https://law.counselstack.com/opinion/dubose-v-gastonia-mutual-savings-loan-assn-ncctapp-1982.