In re Twin County Motorsports, Inc.

749 S.E.2d 474, 230 N.C. App. 259, 2013 WL 5911809, 2013 N.C. App. LEXIS 1135
CourtCourt of Appeals of North Carolina
DecidedNovember 5, 2013
DocketNo. COA13-21
StatusPublished
Cited by1 cases

This text of 749 S.E.2d 474 (In re Twin County Motorsports, Inc.) 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
In re Twin County Motorsports, Inc., 749 S.E.2d 474, 230 N.C. App. 259, 2013 WL 5911809, 2013 N.C. App. LEXIS 1135 (N.C. Ct. App. 2013).

Opinion

DAVIS, Judge.

[260]*260The Commissioner of the North Carolina Division of Motor Vehicles (the “DMV”) appeals from the trial court’s order (1) reversing the final agency decision assessing a civil penalty of $1,500 against Twin County Motorsports, Inc. (“Twin County”) and suspending its safety inspection license for a period of 1,080 days; and (2) remanding for a new hearing before the DMV. The primary issue raised on appeal is whether corporations are required under North Carolina law to be represented by legal counsel in hearings before the DMV. Because we hold that corporations cannot appear pro se in DMV hearings, we affirm the trial court’s order.

Factual Background

On 5 October 2010, Inspector L. Neil Ambrose (“Inspector Ambrose”) of the Bureau of License and Theft of the DMV went to the place of business of Twin County to investigate a report that the business was conducting state inspections without a licensed mechanic in violation of N.C. Gen. Stat. § 20-183.7B(a)(3).1 Inspector Ambrose spoke to Lance Cherry (“Cherry”), the owner of Twin County, and Brandon Crawley (“Crawley”), the service manager of the station, and learned that Twin County’s employees were improperly using the access code of a former employee — who was a licensed safety inspection mechanic — to conduct motor vehicle safety inspections.

Inspector Ambrose charged Crawley with four counts of performing a safety inspection without a license (a Class 3 misdemeanor) and cited Twin County with six violations of N.C. Gen. Stat. § 20-183.7B(a)(3). On 5 May 2011, Cherry was served with Notices of Charges. The violations alleged in the Notices of Charges were classified as “Type I” violations, which carry a civil penalty of $250 and a six month suspension of the business’ license for the first or second violation within three years and a penalty of $1,000 and a two-year license suspension for any subsequent violations.

Cherry requested an administrative hearing before the DMV, and a hearing was held on 19 May 2011. Twin County was not represented by counsel at this proceeding. Instead, Cherry appeared on Twin County’s behalf, and DMV Hearing Officer Linda Brown allowed him to represent Twin County pro se. On 24 May 2011, Hearing Officer Brown entered an Official Hearing Decision and Order (1) finding that Twin County committed the six Type I violations; (2) ordering the suspension of Twin [261]*261County’s safety equipment inspection station license for a period of 1,080 days; and (3) imposing a civil penalty assessment of $1,500.

Twin County requested a review by the Commissioner of the hearing officer’s decision. The Commissioner subsequently upheld the hearing officer’s decision. Twin County sought judicial review of the final agency decision in Nash County Superior Court pursuant to N.C. Gen. Stat. § 20-183.8G(g) and Article 4 of Chapter 150B.

On 17 October 2012, the Honorable Frank Brown entered an order reversing the final agency decision and remanding the matter to the hearing officer for “a new hearing on the Charge Order of October 5, 2010 with [Twin County] represented by proper counsel.” The Commissioner appealed to this Court.

Analysis

On appeal, the Commissioner argues that the trial court erred in reversing the final agency decision of the DMV on the grounds that (1) corporations are entitled to appear pro se in DMV hearings; and (2) there was substantial, competent evidence in the record supporting the final agency decision. Because we hold that corporations must be represented by legal counsel in hearings before the DMV and cannot appear pro se, we affirm the trial court’s order.

In North Carolina, the general rule is that “a corporation must be represented by a duly admitted and licensed attorney-at-law and cannot proceed pro se . . . .” Lexis-Nexis, Div. of Reed Elsevier, Inc. v. Travishan Corp., 155 N.C. App. 205, 209, 573 S.E.2d 547, 549 (2002).

In Lexis-Nexis, Florence Smith, a non-attorney and the chief executive officer and sole shareholder of the defendant corporation, filed an answer and counterclaim on behalf of the corporation. Id. at 206, 573 S.E.2d at 548. The plaintiff moved to strike Smith’s answer and counterclaim, arguing that Smith’s pro se representation of the defendant constituted the unauthorized practice of law. Id. The trial court allowed Smith to represent the defendant but dismissed her counterclaim against the plaintiff. Id.

Smith appealed the dismissal of her counterclaim, and the plaintiff cross-appealed the trial court’s order permitting Smith’s representation of the defendant. Id. We held that “a corporation must be represented by a duly admitted and licensed attorney-at-law and cannot proceed pro se unless doing so in accordance with the exceptions set forth in this opinion.” Id. at 209, 573 S.E.2d at 549. In so holding, we reasoned that

[262]*262[regarding legal representation, North Carolina law provides that “it shall be unlawful for any person or association of persons, except active members of the Bar of the State of North Carolina admitted and licensed to practice as attomeys-at-law, to appear as attorney or counselor at law in any action or proceeding before any judicial body ... except in his own behalf as a party thereto.” N.C. Gen. Stat. § 84-4 (2001). Moreover, “[a] corporation cannot lawfully practice law. It is a personal right of the individual.” Seawell, Attorney General v. Motor Club, 209 N.C. 624, 631, 184 S.E. 540, 544 (1936).

Id. at 207, 573 S.E.2d at 548-49. We then examined the law of other jurisdictions and set out the following three exceptions to the rule requiring corporations to be represented by counsel: (1) an employee of a corporation may prepare legal documents; (2) a corporation may appear pro se in small claims court; and (3) a corporation may enter an appearance through a corporate officer to avoid default. Id. at 208, 573 S.E.2d at 549.

In Allied Envtl. Servs., PLLC v. N.C. Dep’t of Envtl. & Natural Res., 187 N.C. App. 227, 229, 653 S.E.2d 11, 13 (2007), disc, review denied, 362 N.C. 354, 661 S.E.2d 238 (2008), a case upon which the DMV heavily relies in the present appeal, we held that our decision in Lexis-Nexis was not applicable to most contested case proceedings before the Office of Administrative Hearings (“OAH”). Allied arose from a decision by the North Carolina Department of Environment and Natural Resources (“DENR”) to revoke the eligibility of Deans Oil Company, Inc. to receive reimbursement from the North Carolina Commercial Leaking Underground Storage Tank Clean Up Fund.2 Id. at 228, 653 S.E.2d at 12. Upon receiving notification that it would no longer receive reimbursements for clean-up costs and that it was required to repay prior disbursements from the fund, Brian Gray, the president of Allied Environmental Services, attempted to appeal DENR’s decision by signing and submitting a petition for a contested case in the OAH. Id. at 229, 653 S.E.2d at 12.

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Related

In Re Twin County Motorsports, Inc.
766 S.E.2d 832 (Supreme Court of North Carolina, 2014)

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Bluebook (online)
749 S.E.2d 474, 230 N.C. App. 259, 2013 WL 5911809, 2013 N.C. App. LEXIS 1135, Counsel Stack Legal Research, https://law.counselstack.com/opinion/in-re-twin-county-motorsports-inc-ncctapp-2013.