Gilley v. Shoffner

345 F. Supp. 2d 563, 2004 U.S. Dist. LEXIS 23835, 2004 WL 2700057
CourtDistrict Court, M.D. North Carolina
DecidedNovember 18, 2004
DocketCIV.L04 CV 00533
StatusPublished
Cited by35 cases

This text of 345 F. Supp. 2d 563 (Gilley v. Shoffner) is published on Counsel Stack Legal Research, covering District Court, M.D. North Carolina primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Gilley v. Shoffner, 345 F. Supp. 2d 563, 2004 U.S. Dist. LEXIS 23835, 2004 WL 2700057 (M.D.N.C. 2004).

Opinion

MEMORANDUM OPINION

BULLOCK, District Judge.

Plaintiffs filed a pro se action against Defendant in the General Court of Justice, Superior Court Division, Cabarrus County, North Carolina, on May 4, 2004. Plaintiffs simultaneously filed a notice of lis pendens pursuant to North Carolina General Statute § 1-116, which was cross-indexed by the Clerk of the Superior Court in the Record of Lis Pendens pursuant to North Carolina General Statute § 1-117. Defendant timely removed the action based on diversity of citizenship. Before the court is Defendant’s motion to cancel the notice of lis pendens and to dismiss Plaintiff Three Rivers Valle, LLC.

DISCUSSION

I. The Notice of Lis Pendens is Unauthorized by State Statute and Should be Cancelled

The court applies North Carolina law in determining the propriety of the notice of lis pendens. 28 U.S.C. § 1964 (“Where the law of a State requires a notice of an action concerning real property pending in a court of the State to be registered, recorded, docketed, or indexed in a particular manner ... in order to give constructive notice of the action as it relates to the real property, and such law authorizes a notice of an action concerning real property pending in a United States district court to be registered, recorded, docketed, or indexed in the same manner, or in the same place, those requirements of the State law must be complied with in order to give constructive notice of such an action pending in a United States district court as it relates to real property in such *565 State.”); N.C. Gen.Stat. § 1-120.1 (“The provisions of [North Carolina law regarding lis pendens] shall apply to suits affecting the title to real property in the federal courts.”). “The sole object of lis pendens is to keep the subject in controversy within the power of the court until final .decree and to make it possible for courts to execute their judgments. It gives notice of a claim of which otherwise a prospective purchaser would be ignorant.” Mass. Bonding & Ins. Co. v. Knox, 220 N.C. 725, -, 18 S.E.2d 436, 438 (1942); see also In re Medlin, 229 B.R. 353, 358 (Bankr.E.D.N.C.1998) (“In North Carolina, as in other states, lis pendens ‘is a statutory device by which the world is put on notice that an order of attachment has been issued with respect to certain real property owned by a party against whom a monetary judgment is sought.’ ” (citation omitted)).

The North Carolina code provides for three situations in which notice of lis pendens may be utilized. See N.C. Gen.Stat. § 1-116(a). The three situations are: “(1) Actions affecting title to real property; (2) Actions to foreclose any mortgage or deed of trust or to enforce any lien on real property; and (3) Actions in which any order of attachment is issued and real property is attached.” Id.; see Zinn v. Walker, 87 N.C.App. 325, 361 S.E.2d 314 (1987) (finding that a real estate developer who entered into an offer to purchase agreement held only a contractual interest in the resale profits and could not file a notice of lis pendens). If the plaintiffs complaint fails to assert a claim falling within the scope of actions contemplated by North Carolina General Statute § 1-116(a), then the court may cancel the notice of lis pendens on a motion by the owner of the land without final resolution of the plaintiffs complaint. N.C. Gen.Stat. § 1-120 (providing that the court in which the action was commenced may “on good cause shown” order the notice of lis pen-dens to be cancelled of record); In re Tara of North Hills, 84 B.R. 416, 419 (Bankr.E.D.N.C.1988) (“Although the court in which the action was commenced is the Superior Court Division of the General Court of Justice for Wake County, North Carolina, the civil suit has been removed to this court and this bankruptcy court is now the appropriate court to enter the order pursuant to N.C.GEN.STAT. § 1-120.”); see also Cutter v. Cutter Realty Co., 265 N.C. 664, 669, 144 S.E.2d 882, 885 (1965) (“This is not an action of a type in which G.S. § 1-116 permits the filing of a notice of lis pendens and, therefore, the order canceling the notice filed by the plaintiffs was properly entered.”).

Plaintiffs’ complaint alleges fraud, negligent misrepresentation, breach of contract, fraudulent concealment, unjust enrichment, and unfair and deceptive trade practices arising out of an oral contract to develop land owned by Defendant. The complaint filed by Plaintiffs is not an action “to foreclose any mortgage or deed of trust or to enforce any lien on real property,” nor is it an action “in which any order of attachment is issued and real property is attached.” N.C.Gen.Stat. § 1-116(a). Accordingly, analysis of whether or not to cancel the lis pendens centers upon the inquiry of whether Plaintiffs’ cause of action “affeet[s] title to real property.” Id.

“In determining whether a cause of action affects title to real property within the meaning of G.S. § 1-116(a)(1), the nature of thé action must be analyzed by reference to the fácts alleged in the body of the complaint rather than by what is contained in the prayer for relief.” George v. Administrative Office of Courts, 142 N.C.App. 479, 483, 542 S.E.2d 699, 702 (2001). A cause of action does not affect title to real property merely because the *566 action seeks to secure a personal judgment for the payment of money, even though such a judgment, if obtained and properly docketed, would be a lien upon defendant’s land. Booker v. Porth, 1 N.C.App. 434, 435, 161 S.E.2d 767, 768 (1968) (regarding payment for legal services rendered); see also Jarrett v. Holland, 213 N.C. 428, -, 196 S.E. 314, 316 (1938) (“The mere description of a tract of land in a complaint in which only a judgment for debt is sought does not give the action the force and effect of a lis pendens, unless the allegations in the complaint involve the title to lands.”).

Here, the facts alleged in Plaintiffs’ complaint do not state a cause of action affecting the title of Defendant’s land. Instead, Plaintiffs assert tort and contract claims against Defendant. Plaintiffs make no ownership claim to the property; seek no relief transferring title, setting aside a deed, instrument or conveyance; and do not seek to correct a deed. While Plaintiffs might ultimately secure a lien against lands owned by Defendant to secure payment of a judgment, that possibility alone does not warrant a notice of lis pendens on Defendant’s land. Accordingly, the court will cancel the notice of lis pendens against Defendant’s property because Plaintiffs’ cause of action does not affect the title to Defendant’s property.

II. Plaintiff Three Rivers Valle, LLC, Should be Dismissed Because it Cannot Appear Pro Se

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345 F. Supp. 2d 563, 2004 U.S. Dist. LEXIS 23835, 2004 WL 2700057, Counsel Stack Legal Research, https://law.counselstack.com/opinion/gilley-v-shoffner-ncmd-2004.