An unpublished opinion of the North Carolina Court of Appeals does not constitute controlling legal authority. Citation is disfavored, but may be permitted in accordance with the provisions of Rule 30(e)(3) of the North Carolina Rules of Appellate Procedure.
NO. COA13-552 NORTH CAROLINA COURT OF APPEALS
Filed: 7 January 2014
I.B.S.A., INC., d/b/a INDEPENDENT BUILDERS SUPPLY ASSOCIATION, INC., Plaintiff,
v. Johnston County No. 11 CVS 3878 BUILDER’S SUPPLY, INC., BRENDA B. SCHLIE, JOHN T. SCHLIE, DAVID M. BOLDON, DAVID BOLDON, INC., and CONTRACTOR’S LUMBER COMPANY, Defendant.
Appeal by defendants from order entered 1 October 2012 by
Judge James Ammons, Jr. in Johnston County Superior Court.
Heard in the Court of Appeals 10 October 2013.
Daughtry, Woodard, Lawrence & Starling, by Luther D. Starling, Jr., for plaintiff-appellee.
Terry F. Rose, for defendants-appellants.
HUNTER, JR., Robert N., Judge.
Builder’s Supply, Inc., Brenda B. Schlie, John T. Schlie,
David M. Boldon, David Boldon, Inc., and Contractor’s Lumber
Company (collectively, “Defendants”) appeal from an order -2- denying their motion to transfer venue. Because we find the
action to be predominantly transitory and not local, we affirm.
I. Factual & Procedural Background
I.B.S.A., Inc., d/b/a Independent Builders Supply
Association, Inc. (“Plaintiff”) obtained a judgment against
Defendant Builder’s Supply Inc. (“Builder’s Supply”) in Lincoln
County Superior Court File No. 08-CVS-1819 on 4 December 2008
for $325,709.77. At the time the judgment was entered,
Defendants Brenda Schlie and David Boldon owned all of the stock
of and were the only officers of Builder’s Supply.
Brenda and John Schlie owned five acres in Lincoln County
on which Builder’s Supply conducted its business (“Store
Property”). From the complaint, it appears that Builder’s
Supply owned real property in Maple Leaf Subdivision in Lincoln
County (“Maple Leaf Property”). David Boldon was the sole owner
and officer of Defendant David Boldon, Inc. David Boldon, Inc.
owed Builder’s Supply $100,000 on an account.
On 3 February 2009, the Clerk of Court in Lincoln County
issued a writ of execution against Builder’s Supply in the
amount of $334,869.71 plus interest from 30 September 2008. The
writ of execution was returned unsatisfied on 6 July 2009. -3- On 28 May 2009, during the time period that the writ of
execution was outstanding, Brenda Schlie, individually and on
behalf of Builder’s Supply, executed and filed a confession of
judgment in favor of her husband, Defendant John Schlie, in the
amount of $119,173.90.
On 19 July 2009, Builder’s Supply sent an open letter,
written by Brenda Schlie, stating that Builder’s Supply would be
going out of business and would not have sufficient funds to pay
unsecured creditors.
In August 2009, Plaintiff sent Builder’s Supply a request
to verify its records and accounts. Neither Brenda Schlie nor
Builder’s Supply responded to the request. On 24 September
2009, the Clerk of Court in Lincoln County issued an order
requiring Brenda Schlie to appear and testify regarding
Builder’s Supply’s assets and enjoining the transfer of assets.
Attempts to serve Brenda Schlie at her residence were
unsuccessful. A similar order on 20 October 2009 was also
unable to be served at Brenda Schlie’s residence.
On 11 December 2009, David Boldon filed Articles of
Incorporation forming Defendant Contractor’s Lumber Company
(“Contractor’s Lumber”). On 22 December 2009, Brenda and John
Schlie transferred the Store Property to Contractor’s Lumber. -4- All inventory and remaining assets in the store were transferred
to Contractor’s Lumber. Contractor’s Lumber never opened for
business and the transfers were made either without
consideration or without fair and adequate consideration.
On 27 August 2010, Contractor’s Lumber held an auction to
sell the Store Property and the building supplies and equipment.
Although the Store Property itself did not sell, the goods
yielded net proceeds of $42,837.45.
On 29 February 2010, David Boldon, Inc. obtained a judgment
against Builder’s Supply, despite the fact that David Boldon,
Inc. owed in excess of $100,000.00 to Builder’s Supply. As a
result of that judgment, the Maple Leaf Property was placed in
the name of David Boldon, Inc., on 21 October 2010.1
On 30 November 2011, Plaintiff filed a complaint in the
present action in Johnston County: 1) asking the court to pierce
the corporate veil with regard to David Boldon and Brenda
Schlie; 2) alleging fraudulent transfer of Builder’s Supply
inventory and of the Maple Leaf Property; and 3) alleging that
the confession of judgment in favor of John Schlie was
fraudulent.
1 For purposes of this opinion, we assume the Maple Leaf Property was subject to the judgment lien at the time of this transfer. -5- On 28 December 2011, Builder’s Supply, David Boldon, David
Boldon, Inc. and Contractor’s Lumber filed a “motion for
removal” of the action to Lincoln County on the ground that the
complaint sought to set aside the deed to property located in
Lincoln County. On 19 March 2012, Builder’s Supply, Brenda
Schlie, and John Schlie filed a similar motion for removal. On
1 October 2012, the trial court denied the motion for removal.
On 25 October 2012 and 29 October 2012, Defendants filed timely
notice of appeal.
II. Jurisdiction & Standard of Review
This Court has jurisdiction to hear the instant appeal
pursuant to N.C. Gen. Stat. § 7A–27(b)(3) (Supp. 2013).
Although parties generally have “no right of immediate appeal
from interlocutory orders and judgments[,]” Goldston v. Am.
Motors Corp., 326 N.C. 723, 725, 392 S.E.2d 735, 736 (1990),
Defendants have an appeal of right under N.C. Gen. Stat. § 7A-
27(b)(3) because they appeal from an “interlocutory order or
judgment of a superior court or district court in a civil action
or proceeding which . . . [a]ffects a substantial right.” As
our Supreme Court has stated, “[a]lthough the initial question
of venue is a procedural one, there can be no doubt that a right
to venue established by statute is a substantial right. Its -6- grant or denial is immediately appealable.” Gardner v. Gardner,
300 N.C. 715, 719, 268 S.E.2d 468, 471 (1980) (internal citation
omitted).
“Issues of statutory construction are questions of law,
reviewed de novo on appeal.” McKoy v. McKoy, 202 N.C. App. 509,
511, 689 S.E.2d 590, 592 (2010). “‘Under a de novo review, the
court considers the matter anew and freely substitutes its own
judgment’ for that of the lower tribunal.” State v. Williams,
362 N.C. 628, 632–33, 669 S.E.2d 290, 294 (2008) (quoting In re
Greens of Pine Glen Ltd., 356 N.C. 642, 647, 576 S.E.2d 316, 319
(2003)).
III. Analysis
On appeal, Defendants argue the trial court erred by
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An unpublished opinion of the North Carolina Court of Appeals does not constitute controlling legal authority. Citation is disfavored, but may be permitted in accordance with the provisions of Rule 30(e)(3) of the North Carolina Rules of Appellate Procedure.
NO. COA13-552 NORTH CAROLINA COURT OF APPEALS
Filed: 7 January 2014
I.B.S.A., INC., d/b/a INDEPENDENT BUILDERS SUPPLY ASSOCIATION, INC., Plaintiff,
v. Johnston County No. 11 CVS 3878 BUILDER’S SUPPLY, INC., BRENDA B. SCHLIE, JOHN T. SCHLIE, DAVID M. BOLDON, DAVID BOLDON, INC., and CONTRACTOR’S LUMBER COMPANY, Defendant.
Appeal by defendants from order entered 1 October 2012 by
Judge James Ammons, Jr. in Johnston County Superior Court.
Heard in the Court of Appeals 10 October 2013.
Daughtry, Woodard, Lawrence & Starling, by Luther D. Starling, Jr., for plaintiff-appellee.
Terry F. Rose, for defendants-appellants.
HUNTER, JR., Robert N., Judge.
Builder’s Supply, Inc., Brenda B. Schlie, John T. Schlie,
David M. Boldon, David Boldon, Inc., and Contractor’s Lumber
Company (collectively, “Defendants”) appeal from an order -2- denying their motion to transfer venue. Because we find the
action to be predominantly transitory and not local, we affirm.
I. Factual & Procedural Background
I.B.S.A., Inc., d/b/a Independent Builders Supply
Association, Inc. (“Plaintiff”) obtained a judgment against
Defendant Builder’s Supply Inc. (“Builder’s Supply”) in Lincoln
County Superior Court File No. 08-CVS-1819 on 4 December 2008
for $325,709.77. At the time the judgment was entered,
Defendants Brenda Schlie and David Boldon owned all of the stock
of and were the only officers of Builder’s Supply.
Brenda and John Schlie owned five acres in Lincoln County
on which Builder’s Supply conducted its business (“Store
Property”). From the complaint, it appears that Builder’s
Supply owned real property in Maple Leaf Subdivision in Lincoln
County (“Maple Leaf Property”). David Boldon was the sole owner
and officer of Defendant David Boldon, Inc. David Boldon, Inc.
owed Builder’s Supply $100,000 on an account.
On 3 February 2009, the Clerk of Court in Lincoln County
issued a writ of execution against Builder’s Supply in the
amount of $334,869.71 plus interest from 30 September 2008. The
writ of execution was returned unsatisfied on 6 July 2009. -3- On 28 May 2009, during the time period that the writ of
execution was outstanding, Brenda Schlie, individually and on
behalf of Builder’s Supply, executed and filed a confession of
judgment in favor of her husband, Defendant John Schlie, in the
amount of $119,173.90.
On 19 July 2009, Builder’s Supply sent an open letter,
written by Brenda Schlie, stating that Builder’s Supply would be
going out of business and would not have sufficient funds to pay
unsecured creditors.
In August 2009, Plaintiff sent Builder’s Supply a request
to verify its records and accounts. Neither Brenda Schlie nor
Builder’s Supply responded to the request. On 24 September
2009, the Clerk of Court in Lincoln County issued an order
requiring Brenda Schlie to appear and testify regarding
Builder’s Supply’s assets and enjoining the transfer of assets.
Attempts to serve Brenda Schlie at her residence were
unsuccessful. A similar order on 20 October 2009 was also
unable to be served at Brenda Schlie’s residence.
On 11 December 2009, David Boldon filed Articles of
Incorporation forming Defendant Contractor’s Lumber Company
(“Contractor’s Lumber”). On 22 December 2009, Brenda and John
Schlie transferred the Store Property to Contractor’s Lumber. -4- All inventory and remaining assets in the store were transferred
to Contractor’s Lumber. Contractor’s Lumber never opened for
business and the transfers were made either without
consideration or without fair and adequate consideration.
On 27 August 2010, Contractor’s Lumber held an auction to
sell the Store Property and the building supplies and equipment.
Although the Store Property itself did not sell, the goods
yielded net proceeds of $42,837.45.
On 29 February 2010, David Boldon, Inc. obtained a judgment
against Builder’s Supply, despite the fact that David Boldon,
Inc. owed in excess of $100,000.00 to Builder’s Supply. As a
result of that judgment, the Maple Leaf Property was placed in
the name of David Boldon, Inc., on 21 October 2010.1
On 30 November 2011, Plaintiff filed a complaint in the
present action in Johnston County: 1) asking the court to pierce
the corporate veil with regard to David Boldon and Brenda
Schlie; 2) alleging fraudulent transfer of Builder’s Supply
inventory and of the Maple Leaf Property; and 3) alleging that
the confession of judgment in favor of John Schlie was
fraudulent.
1 For purposes of this opinion, we assume the Maple Leaf Property was subject to the judgment lien at the time of this transfer. -5- On 28 December 2011, Builder’s Supply, David Boldon, David
Boldon, Inc. and Contractor’s Lumber filed a “motion for
removal” of the action to Lincoln County on the ground that the
complaint sought to set aside the deed to property located in
Lincoln County. On 19 March 2012, Builder’s Supply, Brenda
Schlie, and John Schlie filed a similar motion for removal. On
1 October 2012, the trial court denied the motion for removal.
On 25 October 2012 and 29 October 2012, Defendants filed timely
notice of appeal.
II. Jurisdiction & Standard of Review
This Court has jurisdiction to hear the instant appeal
pursuant to N.C. Gen. Stat. § 7A–27(b)(3) (Supp. 2013).
Although parties generally have “no right of immediate appeal
from interlocutory orders and judgments[,]” Goldston v. Am.
Motors Corp., 326 N.C. 723, 725, 392 S.E.2d 735, 736 (1990),
Defendants have an appeal of right under N.C. Gen. Stat. § 7A-
27(b)(3) because they appeal from an “interlocutory order or
judgment of a superior court or district court in a civil action
or proceeding which . . . [a]ffects a substantial right.” As
our Supreme Court has stated, “[a]lthough the initial question
of venue is a procedural one, there can be no doubt that a right
to venue established by statute is a substantial right. Its -6- grant or denial is immediately appealable.” Gardner v. Gardner,
300 N.C. 715, 719, 268 S.E.2d 468, 471 (1980) (internal citation
omitted).
“Issues of statutory construction are questions of law,
reviewed de novo on appeal.” McKoy v. McKoy, 202 N.C. App. 509,
511, 689 S.E.2d 590, 592 (2010). “‘Under a de novo review, the
court considers the matter anew and freely substitutes its own
judgment’ for that of the lower tribunal.” State v. Williams,
362 N.C. 628, 632–33, 669 S.E.2d 290, 294 (2008) (quoting In re
Greens of Pine Glen Ltd., 356 N.C. 642, 647, 576 S.E.2d 316, 319
(2003)).
III. Analysis
On appeal, Defendants argue the trial court erred by
denying their motions to remove the case to Lincoln County. We
disagree and affirm the trial court’s ruling.
Under N.C. Gen. Stat. § 1-76 (2011), actions for
“[r]ecovery of real property, or of an estate or interest
therein, or for the determination in any form of such right or
interest, and for injuries to real property must be tried in the
county in which the subject of the action, or some part thereof,
is situated[.]” On the other hand, N.C. Gen. Stat. § 1-82
(2011) prescribes that “[i]n all other cases the action must be -7- tried in the county in which the plaintiffs or the defendants,
or any of them, reside at its commencement, or if none of the
defendants reside in the State, then in the county in which the
plaintiffs, or any of them, reside[.]”
To determine which statute applies to a given set of facts,
our Supreme Court has stated:
If the judgment to which plaintiff would be entitled upon the allegations of the complaint will affect the title to land, the action is local and must be tried in the county where the land lies unless defendant waives the proper venue; otherwise, the action is transitory and must be tried in the county where one or more of the parties reside at the commencement of the action.
Thompson v. Horrell, 272 N.C. 503, 504–05, 158 S.E.2d 633, 634–
35 (1968).
Our Supreme Court has further explained:
an action is not necessarily local because it incidentally involves the title to land or a right or interest therein, or because the judgment that may be rendered may settle the rights of the parties by way of estoppel. It is the principal object involved in the action which determines the question, and if title is principally involved or if the judgment or decree operates directly and primarily on the estate or title, and not alone in personam against the parties, the action will be held local. -8- Rose’s Stores, Inc. v. Tarrytown Center, Inc., 270 N.C. 201,
206, 154 S.E.2d 320, 323 (1967) (emphasis added) (quotation
marks and citation omitted). Thus, in the present case, we look
for the “principal object” of Plaintiff’s action. See
Kirkland’s Stores, Inc. v. Cleveland Gastonia, LLC, ___ N.C.
App. ___, ___, 733 S.E.2d 885, 889 (2012).
Taken together, Plaintiff’s action seeks to collect money
on an account and to enforce its judgment against the debtor and
his allies, whose actions have been taken in an effort to
defraud creditors. The complaint, in effect, is an effort to
aid in executing the Plaintiff’s prior judgment. Unlike cases
in which determining the ownership of legal interests in land is
paramount, here the dispute is centered solely on a remedy which
is monetary damages. Put differently, Plaintiff does not desire
to adjudicate the title to the property per se but is only
concerned with the amount of equity, if any, remaining at the
time of the transfer, which could be used to pay the judgment.
The only realty at issue in this case appears to be the Maple
Leaf Property in which Plaintiff already has a superior lien.
It is therefore obvious the Plaintiff’s requested relief of
setting aside the transfer is surplusage and not the main object -9- of the suit. Under these facts, we hold the action is
transitory in nature and not local.
Because the principal object of Plaintiff’s action is
recovery of monetary damages, Plaintiff’s action is incidental
to the principal object of recovering assets that were allegedly
fraudulently transferred. Therefore, venue is transitory and
the trial court did not err in denying Defendants’ motions for
removal.
IV. Conclusion
For the foregoing reasons, the decision of the trial court
is
AFFIRMED.
Judges ERVIN and DAVIS concur.
Report per Rule 30(e).