In re Foreclosure of Cornblum

Opinion

An unpublished opinion of the North Carolina Court of Appeals does not constitute controlling legal authority.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. COA13-1247 NORTH CAROLINA COURT OF APPEALS

Filed: 15 July 2014

IN THE MATTER OF THE Swain County FORECLOSURE OF THE DEED OF No. 09-SP-77 TRUST OF MARSHALL E. CORNBLUM and MADELINE H. CORNBLUM, husband and wife, Grantors,

AS RECORDED IN BOOK 362, AT PAGE REGISTRY.

v.

WILLIAM RICHARD BOYD, JR., Substitute Trustee

SEE APPOINTMENT OF SUBSTITUTE TRUSTEE AS RECORDED IN BOOK 379 AT PAGE 775 OF THE SWAIN COUNTY PUBLIC REGISTRY.

__________

IN THE MATTER OF THE Swain County FORECLOSURE OF THE DEED OF No. 09-SP-78 TRUST OF MARSHALL E. CORNBLUM and MADELINE H. CORNBLUM, husband and wife, Grantors,

AS RECORDED IN BOOK 332, AT PAGE REGISTRY.

v. -2-

WILLIAM RICHARD BOYD, JR., Substitute Trustee

SEE APPOINTMENT OF SUBSTITUTE TRUSTEE AS RECORDED IN BOOK 379 AT PAGE 783 OF THE SWAIN COUNTY PUBLIC REGISTRY. __________

IN THE MATTER OF THE Swain County FORECLOSURE OF THE DEED OF No. 09-SP-79 TRUST OF MARSHALL E. CORNBLUM and MADELINE H. CORNBLUM, husband and wife, Grantors,

AS RECORDED IN BOOK 329, AT PAGE REGISTRY.

v.

WILLIAM RICHARD BOYD, JR., Substitute Trustee

SEE APPOINTMENT OF SUBSTITUTE TRUSTEE AS RECORDED IN BOOK 379 AT PAGE 785 OF THE SWAIN COUNTY PUBLIC REGISTRY.

__________

IN THE MATTER OF THE Swain County FORECLOSURE OF THE DEED OF No. 09-SP-80 TRUST OF MARSHALL E. CORNBLUM and MADELINE H. CORNBLUM, husband and wife, Grantors,

AS RECORDED IN BOOK 339, AT PAGE REGISTRY. -3- v.

WILLIAM RICHARD BOYD, JR., Substitute Trustee

SEE APPOINTMENT OF SUBSTITUTE TRUSTEE AS RECORDED IN BOOK 379 AT PAGE 791 OF THE SWAIN COUNTY PUBLIC REGISTRY. __________

IN THE MATTER OF THE Swain County FORECLOSURE OF THE DEED OF No. 09-SP-81 TRUST OF MARSHALL E. CORNBLUM and MADELINE H. CORNBLUM, husband and wife, Grantors,

AS RECORDED IN BOOK 328, AT PAGE REGISTRY.

v.

WILLIAM RICHARD BOYD, JR., Substitute Trustee

SEE APPOINTMENT OF SUBSTITUTE TRUSTEE AS RECORDED IN BOOK 379 AT PAGE 777 OF THE SWAIN COUNTY PUBLIC REGISTRY.

__________

IN THE MATTER OF THE Swain County FORECLOSURE OF THE DEED OF No. 09-SP-82 TRUST OF MARSHALL E. CORNBLUM and MADELINE H. CORNBLUM, husband and wife, Grantors,

AS RECORDED IN BOOK 326, AT PAGE REGISTRY. -4-

v.

WILLIAM RICHARD BOYD, JR., Substitute Trustee

SEE APPOINTMENT OF SUBSTITUTE TRUSTEE AS RECORDED IN BOOK 379 AT PAGE 789 OF THE SWAIN COUNTY PUBLIC REGISTRY. __________

IN THE MATTER OF THE Swain County FORECLOSURE OF THE DEED OF No. 10-SP-01 TRUST OF MARSHALL E. CORNBLUM and MADELINE H. CORNBLUM, husband and wife, Grantors,

AS RECORDED IN BOOK 336, AT PAGE REGISTRY.

v.

WILLIAM RICHARD BOYD, JR., Substitute Trustee

SEE APPOINTMENT OF SUBSTITUTE TRUSTEE AS RECORDED IN BOOK 379 AT PAGE 779 OF THE SWAIN COUNTY PUBLIC REGISTRY.

__________

IN THE MATTER OF THE Swain County FORECLOSURE OF THE DEED OF No. 10-SP-02 TRUST OF MARSHALL E. CORNBLUM and MADELINE H. CORNBLUM, husband and wife, Grantors,

AS RECORDED IN BOOK 346, AT PAGE -5- REGISTRY.

v.

WILLIAM RICHARD BOYD, JR., Substitute Trustee

SEE APPOINTMENT OF SUBSTITUTE TRUSTEE AS RECORDED IN BOOK 379 AT PAGE 773 OF THE SWAIN COUNTY PUBLIC REGISTRY. __________

IN THE MATTER OF THE Swain County FORECLOSURE OF THE DEED OF No. 10-SP-06 TRUST OF MARSHALL E. CORNBLUM and MADELINE H. CORNBLUM, husband and wife, Grantors,

AS RECORDED IN BOOK 346, AT PAGE REGISTRY.

v.

WILLIAM RICHARD BOYD, JR., Substitute Trustee

SEE APPOINTMENT OF SUBSTITUTE TRUSTEE AS RECORDED IN BOOK 379 AT PAGE 797 OF THE SWAIN COUNTY PUBLIC REGISTRY.

__________

IN THE MATTER OF THE Jackson County FORECLOSURE OF THE DEED OF 09-SP-451 LONGBRANCH PROPERTIES, L.L.C., a North Carolina Limited Liability Company, Grantor, -6- AS RECORDED IN BOOK 1656, AT PAGE REGISTRY.

v.

WILLIAM RICHARD BOYD, JR., Substitute Trustee

SEE APPOINTMENT OF SUBSTITUTE TRUSTEE AS RECORDED IN BOOK 1829 AT PAGE 270 OF THE JACKSON COUNTY PUBLIC REGISTRY. __________

IN THE MATTER OF THE Jackson County FORECLOSURE OF THE DEED OF 09-SP-453 LONGBRANCH PROPERTIES, L.L.C., a North Carolina Limited Liability Company, Grantor,

AS RECORDED IN BOOK 1603, AT PAGE REGISTRY.

v.

WILLIAM RICHARD BOYD, JR., Substitute Trustee

SEE APPOINTMENT OF SUBSTITUTE TRUSTEE AS RECORDED IN BOOK 1829 AT PAGE 272 OF THE JACKSON COUNTY PUBLIC REGISTRY. __________

IN THE MATTER OF THE Jackson County FORECLOSURE OF THE DEED OF 09-SP-454 LONGBRANCH PROPERTIES, L.L.C., a North Carolina Limited Liability Company, Grantor, -7- AS RECORDED IN BOOK 1667, AT PAGE REGISTRY.

v.

WILLIAM RICHARD BOYD, JR., Substitute Trustee

SEE APPOINTMENT OF SUBSTITUTE TRUSTEE AS RECORDED IN BOOK 1829 AT PAGE 268 OF THE JACKSON COUNTY PUBLIC REGISTRY.

Appeal by Marshall E. Cornblum, Madeline H. Cornblum,

Michael Cornblum, Carolyn Cornblum, and Longbranch Properties,

LLC, from order entered 6 May 2013 by Judge James U. Downs in

Swain County Superior Court.

SHANAHAN LAW GROUP, PLLC, by Kieran J. Shanahan, Brandon S. Neuman, and John E. Branch III, for appellants.

VAN WINKLE, BUCK, WALL, STARNES & DAVIS, P.A., by Lynn D. Moffa and Esther Manheimer, for appellees.

ELMORE, Judge.

After careful review, we hold that the trial court erred in

denying the appellants-mortgagors’ motion for order denying the

appellee-mortgagee’s motion to confirm the arbitration award. -8- The trial court lacked subject matter jurisdiction to enter said

order. Accordingly, we vacate the trial court’s order.

I. Background

This case is now before this Court for the second time on

appeal. See In re Cornblum, ___ N.C. App. ___, 727 S.E.2d 338

(2012), review denied, 366 N.C. 404, 734 S.E.2d 864 (2012), and

cert. denied, writ denied, 366 N.C. 404, 734 S.E.2d 865 (2012)

and review dismissed, 366 N.C. 404, 734 S.E.2d 866 (2012). In

In re Cornblum (Cornblum I), the mortgagors, Marshall E.

Cornblum, Madeline H. Cornblum, Michael Cornblum, Carolyn

Cornblum, and Longbranch Properties, LLC, (appellants) executed

thirteen promissory notes secured by deeds of trust on various

pieces of real property purchased and developed with the loans.

When the mortgagors defaulted on their obligations, United

Community Bank (UCB), the mortgagee, commenced twelve separate

foreclosure actions in Swain and Jackson County Superior Courts

under N.C. Gen. Stat. § 45–21.16 (2011). Id. at ___, 727 S.E.2d

at 339. Appellants demanded arbitration of all claims pursuant

to the arbitration agreement contained in each deed of trust.

Id. When UCB refused to arbitrate, appellants filed motions to

compel arbitration. Id. Judge James U. Downs granted -9- appellants’ motions to compel arbitration. While the

arbitration proceedings were pending, UCB assigned the

promissory notes, guaranties, and deeds of trust to Asset

Holding Company 5, LLC (“AHC” and collectively, “appellees”).

AHC was joined in the arbitration proceedings as a party-

claimant, but UCB remained a party for the purposes of

appellants’ counterclaims. Id. at ___, 727 S.E.2d at 340. On

20 September 2010, the arbitrator ruled in favor of appellees on

all claims and issued an arbitration award accordingly. Id. On

8 October 2010, appellees filed a motion to confirm the

arbitration award in Swain County Superior Court. The superior

court granted appellees’ motion to confirm the arbitration award

and denied appellants’ motion to vacate the award. Id.

Appellants appealed to this Court on the basis that the

superior court lacked subject matter jurisdiction to confirm the

arbitration award. This Court agreed with appellants, holding

that “submitting this case to arbitration and confirming the

arbitration award fell outside of the superior court’s subject

matter jurisdiction.” Id. at ___, 727 S.E.2d at 342. On 7 May

2012, the Court of Appeals filed its judgment reversing the

superior court’s order confirming the arbitration award on the -10- basis that the superior court lacked subject matter

jurisdiction.

In March 2013, nearly one year after this Court rendered

its decision in Cornblum I, appellants, claiming that appellees’

motion to confirm the arbitration award was still pending

despite this Court’s decision in Cornblum I, filed a motion for

order denying the appellees’ motion to confirm the arbitration

award. Judge Downs heard appellants’ motion and subsequently

entered an order denying it. Appellants submitted a notice of

appeal to this Court on 3 June 2013. Again, we vacate the trial

court’s order.

II. Analysis

Appellants (now “the Cornblums”) argue that the trial court

erred in denying their motion for an order denying appellees’

motion to confirm the arbitration award. Given the decision in

Cornblum I, the Cornblums aver that the trial court was required

to grant their motion, and, by failing to do so, the trial court

acted inconsistently or at a variance with this Court’s mandate

in Cornblum I. We disagree.

Whether an action taken by a superior court complies with a

mandate is a question of law reviewed de novo. McKinney v.

McKinney, ____ N.C. App. ____, ____, 745 S.E.2d 356, 358 (2013). -11- “‘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. P’ship,

356 N.C. 642, 647, 576 S.E.2d 316, 319 (2003)).

“Jurisdiction [is] . . . the power to hear and to determine

a legal controversy; to inquire into the facts, apply the law,

and to render and enforce a judgment[.]” State v. Daniels, ____

N.C. App. ____, ____, 741 S.E.2d 354, 358 (2012), appeal

dismissed, disc. review denied, 366 N.C. 565, 738 S.E.2d 389

(2013) (quoting High v. Pearce, 220 N.C. 266, 17 S.E.2d 108, 112

(1941)). “Properly speaking, there can be no jurisdiction of

the person where there is none of the subject matter, although

the converse might indeed, and often does, occur.” Id. at ___,

741 S.E.2d at 359. “Where there is no jurisdiction of the

subject matter the whole proceeding is void ab initio and may be

treated as a nullity anywhere, at any time, and for any

purpose.” Id.

On appeal, the Cornblums acknowledge that in Cornblum I,

this Court dismissed appellants’ action after holding that the

trial court lacked subject matter jurisdiction to confirm the

arbitration award. Nonetheless, the Cornblums now pray this -12- Court to reverse the trial court’s order and remand with

instructions to grant their motion for order denying appellees’

motion to confirm the arbitration award. In making such

request, the Cornblums completely disregard the basis for this

Court’s reversal in Cornblum I—the lack of subject matter

jurisdiction. To the extent that the trial court acted

inconsistently or at variance with this Court’s mandate, it did

so by ruling on the Cornblums’ motion, not, as the Cornblums

contend, by denying it. See D&W, Inc. v. City of Charlotte,

268 N.C. 720, 722, 152 S.E.2d 199, 202 (1966) (holding that a

mandate from an appellate court is binding upon the trial court

and “must be strictly followed without variation or

departure[,]” [and] “[n]o judgment other than that directed or

permitted by the appellate court may be entered”). The trial

court was bound by this Court’s decision in Cornblum I, and,

absent subject matter jurisdiction, it lacked authority to

either grant or deny the Cornblums’ motion. On appeal, this

Court must vacate the trial court’s order. See State v. Felmet,

302 N.C. 173, 176, 273 S.E.2d 708, 711 (1981) (concluding that

where the trial court issues an order without the requisite

subject matter jurisdiction, “the appropriate action on the part

of the appellate court is to arrest judgment or vacate any order -13- entered without authority”); see also In re Foreclosure of

Young, ____ N.C. App. ____, ____, 744 S.E.2d 476, 479 (2013)

(vacating an order where the trial court exceeded jurisdictional

scope in foreclosure hearing by making findings and conclusions

regarding an equitable estoppel defense).

III. Conclusion

The trial court, acting in direct contravention with

this Court’s holding in Cornblum I, erred in ruling on the

Cornblums’ motion for order denying appellees’ motion to confirm

the arbitration award. The trial court lacked subject matter

jurisdiction to hear the matter. As such, we vacate the trial

court’s 6 May 2013 order.

Vacated.

Judges McGEE and HUNTER, Robert C. concur.

Report per Rule 30(e).