Eastway Wrecker Service, Inc. v. City of Charlotte

599 S.E.2d 410, 165 N.C. App. 639, 2004 N.C. App. LEXIS 1439
CourtCourt of Appeals of North Carolina
DecidedAugust 3, 2004
DocketCOA03-399
StatusPublished
Cited by41 cases

This text of 599 S.E.2d 410 (Eastway Wrecker Service, Inc. v. City of Charlotte) 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
Eastway Wrecker Service, Inc. v. City of Charlotte, 599 S.E.2d 410, 165 N.C. App. 639, 2004 N.C. App. LEXIS 1439 (N.C. Ct. App. 2004).

Opinions

GEER, Judge.

■ Plaintiff Eastway Wrecker Service, Inc. (“Eastway”) appeals from an order dismissing its claims against defendant City of Charlotte based on quantum meruit and negligent misrepresentation. We hold that the quantum meruit cause of action is barred by sovereign immunity while the negligent misrepresentation cause of action failed to include all the allegations necessary to state a claim for relief. We, therefore, affirm.

Factual Background

Plaintiff entered into an agreement with defendant providing that plaintiff would tow, store, and dispose of motor vehicles, as directed by the police, for a specified geographical area known as Zone C. Plaintiff was to pay defendant $2,000.00 annually for the right to service Zone C and agreed to various specifications and conditions regarding documentation, service hours, and storage facilities, as well as a fee schedule for services rendered and the sale of unclaimed motor vehicles.

In a complaint filed 28 March 2002 and amended in August 2002, plaintiff alleged that defendant breached the agreement by failing to pay plaintiff for services provided under the agreement. In its amended complaint, plaintiff added alternative claims for (1) damages in quantum meruit for labor and materials supplied; (2) for negligent misrepresentation by defendant in connection with the agreement; and (3) breach of the covenant of good faith and fair [641]*641dealing. Defendant filed a motion to dismiss the alternative claims pursuant to Rule 12(b)(6). Following a hearing, the trial court entered an order on 6 January 2003 granting defendant’s motion to dismiss as to plaintiffs quantum meruit and negligent misrepresentation claims, but denying it as to the claim for breach of the implied covenant of good faith and fair dealing. As a result, plaintiffs claims for breach of contract and breach of the implied covenant of good faith and fair dealing remain pending. Plaintiff appeals from the 6 January 2003 order.

Discussion

Because the trial court’s order granting defendant’s motion to dismiss did not dispose of all of plaintiff’s claims against defendant, the order is interlocutory. DKH Corp. v. Rankin-Patterson Oil Co., 348 N.C. 583, 584, 500 S.E.2d 666, 667 (1998). The trial court, however, included a certification that the dismissal of plaintiff’s claims for quantum meruit and negligent misrepresentation was a “final judgment[] and dispositive as to these claims and there is no reason to delay an appeal.” In an action with multiple parties or multiple claims, Rule 54(b) provides that “if the trial court enters a final judgment as to a party or a claim and certifies there is no just reason for delay, the judgment is immediately appealable.” Id. at 585, 500 S.E.2d at 668. We agree with the trial court that the dismissal order was properly certified under Rule 54(b) and, therefore, address the merits of plaintiff’s appeal.

To determine if a complaint is sufficient to withstand a Rule 12(b)(6) motion to dismiss, the trial court must “ascertain ‘whether, as a matter of law, the allegations of the complaint, treated as true, are sufficient to state a claim upon which relief may be granted under some legal theory.’ ” Plummer v. Community Gen. Hosp. of Thomasville, Inc., 155 N.C. App. 574, 576, 573 S.E.2d 596, 598 (2002) (quoting Shell Island Homeowners Ass’n v. Tomlinson, 134 N.C. App. 217, 225, 517 S.E.2d 406, 413 (1999)), disc. review denied, 357 N.C. 63, 579 S.E.2d 392 (2003). As an initial matter, we address the dissent’s conclusion that the trial court considered matters outside the pleadings, thereby converting the motion to dismiss into a motion for summary judgment under Rule 12(b): “If, on a motion asserting the defense numbered (6), to dismiss for failure of the pleading to state a claim upon which relief can be granted, matters outside the pleading are presented to and not excluded by the court, the motion shall be treated as one for summary judgment and [642]*642disposed of as provided in Rule 56, and all parties shall be given reasonable opportunity to present all material made pertinent to such a motion by Rule 56.”

After carefully reviewing the record, it appears that the only documents other than the pleadings that were before the trial court in connection with the motion to dismiss were the plaintiff’s exhibits to the complaint. Since the exhibits to the complaint were expressly incorporated by reference in the complaint, they were properly considered in connection with the motion to dismiss as part of the pleadings. See Oberlin Capital, L.P. v. Slavin, 147 N.C. App. 52, 60-61, 554 S.E.2d 840, 847 (2001) (“Here, the loan agreement is the subject of [plaintiffs] complaint and is specifically referred to in the complaint. Therefore, the trial court did not err in reviewing the loan agreement when ruling on the Rule 12(b)(6) motions.”).

Quantum, Meruit

Plaintiff first contends that the trial court erred in dismissing its alternative claim for recovery in quantum meruit on the grounds that such recovery was precluded by the existence of an express contract between the parties. While it is true that an express contract precludes recovery in quantum meruit, Paul L. Whitfield, P.A. v. Gilchrist, 348 N.C. 39, 42, 497 S.E.2d 412, 414 (1998), it was improper for the trial court to assume the presence of an express contract in this case. Under Rule 8(a)(2) of the North Carolina Rules of Civil Procedure, plaintiff is entitled to seek alternative forms of relief. N.C. Gen. Stat. § 1A-1, Rule 8(a)(2) (2003) (“Relief in the alternative or of several different types may be demanded.”). Here, plaintiff’s alternative claim for relief in quantum meruit does not allege that a contract exists, but rather that the parties’ contract is invalid because of defects in its formation and performance. When ruling on a Rule 12(b)(6) motion to dismiss, the trial court must only determine whether the plaintiff’s allegations, if taken as true, support a claim upon which relief may be granted. Sutton v. Duke, 277 N.C. 94, 98-99, 176 S.E.2d 161, 163 (1970); N.C. Gen. Stat. § 1A-1, Rule 12(b)(6) (2003). If plaintiff’s allegations in its alternative claim are accepted as true, no contract exists and quantum meruit is not precluded as a remedy per se. Accordingly, it was error for the trial court to dismiss plaintiff’s alternative claim for recovery in quantum meruit on the ground that it was precluded by an express contract between the parties.

[643]*643Nonetheless, dismissal of the quantum meruit claim was still appropriate because such a claim when brought against an arm of the State is barred by sovereign immunity. In North Carolina, the State waives sovereign immunity when it expressly enters into a valid contract. Smith v. State, 289 N.C. 303, 320, 222 S.E.2d 412, 423-24 (1976). Sovereign immunity bars quantum meruit

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Bluebook (online)
599 S.E.2d 410, 165 N.C. App. 639, 2004 N.C. App. LEXIS 1439, Counsel Stack Legal Research, https://law.counselstack.com/opinion/eastway-wrecker-service-inc-v-city-of-charlotte-ncctapp-2004.