Orr v. Calvert

713 S.E.2d 39, 212 N.C. App. 254, 2011 N.C. App. LEXIS 1163
CourtCourt of Appeals of North Carolina
DecidedJune 7, 2011
DocketCOA10-480
StatusPublished
Cited by5 cases

This text of 713 S.E.2d 39 (Orr v. Calvert) 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
Orr v. Calvert, 713 S.E.2d 39, 212 N.C. App. 254, 2011 N.C. App. LEXIS 1163 (N.C. Ct. App. 2011).

Opinions

McGEE, Judge.

Karen B. Orr (Ms. Orr) and Michael Trexler (Mr. Trexler) (collectively Plaintiffs) filed a complaint against Ronald D. Calvert (Defendant) on 17 December 2007, alleging claims for fraud, misrepresentation, negligence, breach of fiduciary duty, and violations of the North Carolina Securities Act. Defendant answered and asserted that Plaintiffs’ claims were barred by the statute of limitations. At the close of Plaintiffs’ evidence, Defendant moved for a directed verdict on the following two grounds: (1) that Plaintiffs’ claims were barred by the applicable statutes of limitation as to their claims for fraud, misrepresentation, negligence, and North Carolina Securities Act violations; and (2) that Plaintiffs presented insufficient evidence of a fiduciary duty owed by Defendant. The trial judge, in open court, granted Defendant’s motion for directed verdict “on all counts .... [f] or either the Statute of Limitations or the Securities Violations Statute of Limitations.”

I. Facts

Plaintiffs’ complaint contained the following allegations concerning Ms. Orr. Ms. Orr received $150,000 in “early 2003” from a life insurance policy in the name of her former husband. Defendant learned of Ms. Orr’s insurance proceeds from his wife, who worked with Ms. Orr. Defendant then approached Ms. Orr regarding an investment opportunity. Ms. Orr took Defendant’s recommendation and invested the entire $150,000 in a company called Resort Holdings International. Ms. Orr alleged that, “for about six months[,]” she received interest payments on her investment, but that the payments then stopped. Ms. Orr eventually confronted Defendant regarding her investment and Defendant told her three times that he would be “settling up[.]” Plaintiffs’ complaint asserted that “Ms. Orr now realizes that all of the money that she entrusted to [Defendant] is gone.” Ms. Orr further [256]*256alleged that Resort Holdings International was “part of a large scam” and that Defendant was aware of that fact, or should have been aware, when he encouraged Ms. Orr to invest.

Plaintiffs’ complaint contained the following allegations concerning Mr. Trexler. Mr. Trexler had begun doing business with Defendant “in or around 2000.” Defendant approached Mr. Trexler regarding an investment in a company known as Nexstar Communications. Defendant told Mr. Trexler that Nexstar Communications involved “ ‘point of sale’ credit card terminals.” Mr. Trexler, based on Defendant’s “representations and assurances,” invested $35,000 in Nexstar Communications “sometime around late January 2004.” Mr. Trexler alleged he “totally relied” on Defendant. Mr. Trexler “received a few payments on his Nexstar investment and then the payments stopped.” Plaintiffs’ complaint further alleged that they “lost their enti[r]e investments as a result of [Defendant’s] actions.”

After Defendant answered and raised the defense of the statute of limitations, the matter was tried on 15 December 2009. At the close of Plaintiffs’ evidence, Defendant moved for a directed verdict on the grounds stated above. The trial court heard arguments from the parties and granted Defendant’s motion for a directed verdict on 17 December 2009. Plaintiffs appeal. Further facts will be discussed below as necessary.

II. Accrual of Causes of Action

Plaintiffs argue that the trial court erred in granting Defendant’s motion for a directed verdict on all claims based on the statute of limitations. Plaintiffs contend that they presented sufficient evidence to submit to the jury the question of whether their claims were barred by the statute of limitations. We disagree.

We review a trial court’s ruling on a motion for directed verdict to determine “ ‘whether the evidence, taken in the light most favorable to the non-moving party, is sufficient as a matter of law to be submitted to the jury.’ ” Scarborough v. Dillard’s, Inc., 363 N.C. 715, 720, 693 S.E.2d 640, 643 (2009) (citation omitted). A directed verdict in favor of a defendant is proper when, as a matter of law, the plaintiff cannot recover upon any view of the facts reasonably supported by the evidence. Id. However, “when the evidence is so considered, it must do more than raise a suspicion, conjecture, guess, surmise, or speculation as to the pertinent facts in order to justify its submission to the jury.” Transport Co. v. Insurance Co., 236 N.C. 534, 539, 73 [257]*257S.E.2d 481, 485 (1952). “ ‘Once a defendant raises a statute of limitations defense, the burden of showing that the action was instituted within the prescribed period [rests] on the plaintiff. A plaintiff sustains this burden by showing that the relevant statute of limitations has not expired.’ ” Shepard v. Ocwen Fed. Bank, 361 N.C. 137, 139, 638 S.E.2d 197, 199 (2006) (citation omitted). “The issue of whether a cause of action is barred by the statute of limitations should be submitted to a jury ‘[w]hen the evidence is sufficient to support an inference that the limitations period has not expired[.]’ ” Piles v. Allstate Ins. Co., 187 N.C. App. 399, 400, 653 S.E.2d 181, 183 (2007) (citation omitted).

We must therefore determine whether there was sufficient evidence presented at trial “ ‘to support an inference [by the jury] that the limitations period ha[d] not expired[.]’ ” Id. (citation omitted). In the present case, Plaintiffs asserted four causes of action in their complaint: (1) common law fraud and misrepresentation; (2) negligence; (3) breach of fiduciary duty; and (4) violation of the North Carolina Securities Act. Our determination of whether the statutes of limitations had expired for these claims will depend upon a determination as to when they accrued.

A. Fraud

The applicable statute of limitations for fraud or misrepresentation is three years from discovery of the facts constituting fraud or misrepresentation. N.C. Gen. Stat. § 1-52(9) (2009) (three years for “relief on the ground of fraud or mistake; the cause of action shall not be deemed to have accrued until the discovery by the aggrieved party of the facts constituting the fraud or mistake”). “[W]ith respect to a claim for fraud, we have defined “discovery’ ... as ‘actual discovery or the time when the fraud should have been discovered in the exercise of due diligence.’ ” Piles, 187 N.C. App. at 403, 653 S.E.2d at 185 (citation omitted).

“When . . . the fraud is allegedly committed by the superior party to a confidential or fiduciary relationship, the aggrieved party’s lack of reasonable diligence may be excused. This principle of leniency does not apply, however, when an event occurs to ‘excite [the aggrieved party’s] suspicion or put her on such inquiry as should have led, in the exercise of due diligence, to a discovery of the fraud.’ ”

Id. at 404, 653 S.E.2d at 185 (citation omitted).

[258]*258B. Negligence

Plaintiffs’ claims for negligence are based upon Defendant’s alleged “breach[] [of] his professional duties.” “The applicable statute of limitations for professional malpractice, negligence, and breach of contract is three years.” Harrold v. Dowd, 149 N.C. App. 777, 781,

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Orr v. Calvert
713 S.E.2d 39 (Court of Appeals of North Carolina, 2011)

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Bluebook (online)
713 S.E.2d 39, 212 N.C. App. 254, 2011 N.C. App. LEXIS 1163, Counsel Stack Legal Research, https://law.counselstack.com/opinion/orr-v-calvert-ncctapp-2011.