IN THE COURT OF APPEALS OF NORTH CAROLINA
No. COA24-833
Filed 16 July 2025
Scotland County, No. 23CVS000334-820
TEQUILLA SMITH, Adm. of the Estate of TYREK SMITH, Deceased, Plaintiff,
v.
SCOTLAND COUNTY AND WAGRAM RECREATION CENTER, Defendants.
Appeal by plaintiff from order entered 14 July 2024 by Judge Dawn M. Layton
in Scotland County Superior Court. Heard in the Court of Appeals 25 February 2025.
Coy E. Brewer, Jr., for plaintiff.
The Rogers Law Firm, PLLC, by Allen W. Rogers, for plaintiff.
Teague, Campbell, Dennis, & Gorham, LLP, by Jacob H. Wellman, for defendant.
FREEMAN, Judge.
Plaintiff appeals from an order granting defendant’s motion for summary
judgment on her claim that the decedent died as a result of defendant’s negligence.
On appeal, plaintiff argues that the trial court erred by granting defendant’s motion
for summary judgment on the basis that defendant was entitled to governmental
immunity. After careful review, we affirm the trial court’s order.
I. Factual and Procedural Background SMITH V. SCOTLAND CNTY.
Opinion of the Court
Defendant owns and operates the Wagram Recreation Center (“Wagram
Center”) as part of its parks and recreation programs.1 Wagram Center consists of a
gymnasium with a full-sized basketball court, a fitness room, and office and
community spaces. In June 2021, Wagram Center was equipped with an air
conditioning system. However, there was no air conditioning system in the
gymnasium, which was equipped with ventilation fans.
Defendant offered yearly memberships to use the Wagram Center gymnasium
and fitness room. Membership rates for residents of Scotland County ranged from
$4.00 per day to $325.00 per year “for family members [i]n one household.” Fees for
out-of-county residents ranged from $7.00 per day to $500 per year for a family. In
2020, defendant spent $118,207.73 operating Wagram Center and earned $12,016.87
from all of Wagram Center’s recreation programs. In 2021, defendant spent
$129,045.85 on Wagram Center’s operations and earned $6,000.73 in revenue.
Defendant also offered recreation programs that did not require participants
to purchase a Wagram Center membership. One of these was Adult Free Play
basketball, which was held in the gymnasium. To participate in the Adult Free Play
program, a participant “had to be a certain age, they had to have a physical photo ID,
1 Plaintiff named Scotland County and Wagram Recreation Center as separate defendants in
her complaint. Scotland County denied that Wagram Center was an entity capable of suing and being sued. As litigation continued, neither party argued that Wagram Center was an entity separate from Scotland County, and it is not treated as a separate defendant on appeal by either party. Accordingly, there was a final judgment with respect to the only defendant in the action, Scotland County.
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. . . they would have to sign a waiver, and it was a charge of $2[.00]. If they didn’t
have the $2[.00], then [defendant] would waive it.”
The decedent, twenty-four-year-old Tyrek Smith, often played Adult Free Play
basketball and had signed a liability waiver to do so in November 2020. On 10 June
2021, Smith worked the third shift, 11:45 p.m. to 7:45 a.m., at a Purdue chicken
processing plant. After work on 11 June, Smith went to Wagram Center for Adult
Free Play basketball around 11:45 a.m. That day, the Adult Free Play session was
scheduled for 11:00 a.m. to 2:00 p.m. There was no air conditioning in the gymnasium
during this session.
Smith started playing a pickup game of basketball with a few friends just after
11:45 am. Around 12:45 p.m., Smith laid down on the bleachers, as “it was his turn
to sit down and wait[.]” Shortly after, one of his friends checked on Smith and “tried
to get [Smith] to drink but he wouldn’t.” Thirty minutes later, Smith sat up “slumped
over.” At some point after Smith sat down, he called his mother to tell her that he
was coming home. Around 1:47 p.m., Smith fell to the floor. One of the free play
participants went into the lobby and told the recreation assistant, “Somebody needs
to call 911, somebody had passed out.” When the paramedics arrived around 2:00
p.m., they found Smith unconscious. Smith subsequently passed away. He died of
hyperthermia, meaning his body temperature was greatly above normal. In
November 2021, defendant installed an air conditioning system in the gymnasium.
On 1 June 2023, plaintiff, in her capacity as the personal representative of
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Smith’s estate, sued defendant, alleging that Smith’s death was caused by
defendant’s negligent operation and supervision of the gymnasium. On 22 July 2024,
defendant moved for summary judgment, arguing that (1) it was entitled to
governmental immunity; (2) Smith signed a liability waiver; (3) there was no evidence
that it acted negligently to cause Smith’s death; and (4) if it were negligent, then
Smith was contributorily negligent. On 12 August 2024, the trial court granted
defendant’s motion, concluding that there were “no genuine issues of material fact,
and that [defendant] is entitled to judgment as a matter of law on the issue of
governmental immunity.” Plaintiff timely appealed.
II. Jurisdiction
“[A]ppeal lies of right directly to the Court of Appeals . . . [f]rom any final
judgment of a superior court[.]” N.C.G.S. § 7A-27(b)(1) (2023). Accordingly, we have
jurisdiction to review plaintiff’s appeal.
III. Standard of Review
“The standard of review for a trial court’s ruling on a motion for summary
judgment is de novo.” Horne v. Town of Blowing Rock, 223 N.C. App. 26, 32 (2012)
(cleaned up).
IV. Discussion
Plaintiff argues that the trial court erred by granting defendant’s motion for
summary judgment because defendant “operated Wagram Recreation Center in a
proprietary capacity,” so defendant did “not qualify for . . . governmental immunity[.]”
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Summary judgment “shall be rendered . . . if the pleadings, depositions,
answers to interrogatories, and admissions on file, together with the affidavits, if any,
show that there is no genuine issue as to any material fact and that any party is
entitled to judgment as a matter of law.” N.C.G.S. § 1A-1, Rule 56(c) (2023). “All
facts asserted by the adverse party are taken as true and their inferences must be
viewed in the light most favorable to that party[.]” Dobson v. Harris, 352 N.C. 77, 83
(2000) (cleaned up).
The showing required for summary judgment may be accomplished by proving an essential element of the opposing party’s claim does not exist, cannot be proven at trial, or would be barred by an affirmative defense, or by showing through discovery that the opposing party cannot produce evidence to support an essential element of her claim[.]
Id. (cleaned up).
“Under the doctrine of governmental immunity, a county is immune from suit
for the negligence of its employees in the exercise of governmental functions absent
a waiver of immunity.” Evans v. Hous. Auth. of City of Raleigh, 359 N.C. 50, 53 (2004)
(citation omitted). In other words, “[g]overnmental immunity does not . . . apply when
the municipality engages in a proprietary function.” Estate of Williams ex rel. Overton
v. Pasquotank Cnty. Parks & Recreation Dept., 366 N.C. 195, 199 (2012) (citation
omitted).
A governmental function is one “which is discretionary, political, legislative, or
public in nature and performed for the public good [o]n behalf of the State rather than
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for itself[.]” Britt v. City of Wilmington, 236 N.C. 446, 450 (1952). Generally, “[w]hen
a municipality is acting [o]n behalf of the State in promoting or protecting the health,
safety, security or general welfare of its citizens, it is an agency of the sovereign.” Id.
(cleaned up). However, when a municipality “engages in a public enterprise
essentially for the benefit of the compact community, it is acting within its
proprietary powers.” Id. at 451.
“In determining whether an entity is entitled to governmental immunity, the
result therefore turns on whether the alleged tortious conduct of the county or
municipality arose from an activity that was governmental or proprietary in nature.”
Estate of Williams, 366 N.C. at 199. Our Courts have applied a three-step analysis
to determine whether an activity is governmental or proprietary in nature stating:
First, a court must consider whether the legislature has designated the activity as governmental or proprietary. Second, when an activity has not been designated as governmental or proprietary by the legislature, that activity is necessarily governmental in nature when it can only be provided by a government agency or instrumentality. Finally, when the particular service can be performed both privately and publicly, the inquiry involves consideration of a number of additional factors, of which no single factor is dispositive. Relevant to this inquiry is whether the service is traditionally a service provided by a governmental entity, whether a substantial fee is charged for the service provided, and whether that fee does more than simply cover the operating costs of the service provider.
Bynum v. Wilson Cnty., 367 N.C. 355, 358–59 (2014) (citing Estate of Williams, 366
N.C. at 200–03 (2012) (cleaned up)). Thus, “[w]hen the legislature has not directly
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resolved whether a specific activity is governmental or proprietary in nature, other
factors are relevant.” Estate of Williams, 366 N.C. at 202.
We address each factor in turn.
A. Legislative Designation
We first examine the “threshold inquiry”: “whether, and to what degree, the
legislature has addressed the issue.” Meinck v. City of Gastonia, 371 N.C. 497, 503
(2018) (citation omitted). “The creation and operation of public . . . recreation
programs are legitimate and traditional functions of the government.” Hickman ex
rel. Womble v. Fuqua, 108 N.C. App. 80, 84 (1992) (cleaned up). Our General
Assembly has declared that:
[T]he public good and the general welfare of the citizens of this State require adequate recreation programs, that the creation, establishment, and operation of parks and recreation programs is a proper governmental function, and that it is the policy of North Carolina to forever encourage, foster, and provide these facilities and programs for all its citizens.
N.C.G.S. § 160A-351 (2023); see also id. § 160A-353(4) (2023) (“each county . . . in this
State shall have the authority to . . . [p]rovide, acquire, construct, equip, operate, and
maintain . . . recreation centers, and recreation facilities[.]”). “ ‘Recreation’ means
activities that are diversionary in character and aid in promoting entertainment,
pleasure, relaxation, instruction, and other physical, mental, and cultural
development and leisure time experiences.” Id. § 160A-352 (2023).
However, “not every nuanced action that could occur in a park or other
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recreation facility has been designated as governmental or proprietary in nature by
the legislature.” Estate of Williams, 366 N.C. at 202. Accordingly, we must determine
whether the “nuanced activity” here has been designated as governmental by the
legislature.
Plaintiff argues that we should take a broad view of the “nuanced activities,”
and asserts that they are: “operating a gymnasium; charging fees for the use of the
gymnasium, including ‘free play’ activities; charging membership rates for its fitness
room.” Defendant, on the other hand, maintains that we should only “look at the
nuanced activity in which Mr. Smith was actually participating at the time of the
incident to determine whether [defendant’s] operation of [Wagram Center] was
governmental in nature.”
Binding precedent supports that we view the “nuanced activity” narrowly. See
Moffit v. City of Asheville, 9 S.E. 695, 697 (N.C. 1889) (“The liability of cities and
towns for the negligence of their officers or agents depends upon the nature of the
power that the corporation is exercising when the damage complained of is sustained.”
(emphasis added)). For example, in Estate of Williams, the defendant-county’s
alleged tortious conduct occurred in a swimming area of a public park, and the
swimming area could be rented out for private purposes. 366 N.C. at 196–97. Our
Supreme Court only examined the defendant-county’s maintenance and operation of
that specific portion of the park, not the county’s operation of the park as a whole. Id.
at 201. Further, the plaintiff’s complaint specifically identified the county’s operation
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of the swimming area as the alleged tortious conduct. Id. at 196–97.
Here, plaintiff alleged in her complaint that defendant was negligent in “its
operation, maintenance, supervision, and control of the Wagram Recreation Center,
particularly in relationship to property upon which Tyrek Smith was harmed,
injured, and died.” Plaintiff specifically alleged that the cause of Smith’s death was
the lack of air conditioning in the gymnasium where Adult Free Play basketball took
place. Additionally, there is no evidence in the record before us that Smith
participated in any of the other recreation programs offered at Wagram Center.
Because the alleged tortious conduct was defendant’s operation of the Adult Free Play
basketball program, which included operating the gymnasium where Adult Free Play
basketball took place, we focus our analysis on that “nuanced activity” and not
defendant’s operation of Wagram Center as a whole.
Offering access to an indoor gymnasium for adults to play pick-up basketball
is an activity that fosters entertainment and physical development, so Adult Free
Play basketball may be a recreation program that the legislature has declared as a
proper governmental activity. See, e.g., Hickman, 108 N.C. App. at 84 (“[W]e hold
that when a municipality provides free sports instruction . . . , it is acting in a
governmental capacity. Our holding is made even clearer in light of the General
Assembly’s pronouncement on the general subject [in N.C.G.S. § 160A-351].”).
However, considering that the legislature has not expressly designated this activity
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as a governmental function, we will address the remaining factors.2
B. Governmental Exclusivity
We next examine whether the nuanced activity, Adult Free Play basketball,
could “only be provided by a government agency or instrumentality.” Bynum, 367
N.C. at 359 (citation omitted). If so, then the “activity is necessarily governmental[.]”
Id. (citation omitted). Operating a gymnasium for pick-up basketball is not
exclusively reserved for the government; it could be done by a public or private entity.
Therefore, this factor is not dispositive of whether offering Adult Free Play basketball
is a governmental function. But given that the distinction between exclusively
governmental activities and activities that can be performed by public or private
entities “lacks the utility it once had[,]” Estate of Williams, 366 N.C. at 204, as “it is
increasingly difficult to identify services that can only be rendered by a governmental
entity[,]” id. at 202, this factor has little weight in our analysis.
C. Other Factors
Finally, we examine “a number of additional factors,” such as “whether the
2 Continuing this analysis is consistent with precedent. For example, our Supreme Court acknowledged that the defendant-city’s activity, leasing buildings it owned in its downtown area to local artists, was authorized by the Urban Redevelopment Law, N.C.G.S. §§ 160A-500 to -526 (2017), and the Municipal Service District Act, N.C.G.S. §§ 160A-535 to -544 (2017). Meinck, 371 N.C. at 504– 14 (“We conclude that these provisions of the Urban Redevelopment Law and the Municipal Service District Act are statutory indications that an urban redevelopment project undertaken in accordance with these statutes for the purpose of promoting the health, safety, and welfare of the inhabitants of the State of North Carolina is a governmental function.” (cleaned up)). However, recognizing that a general activity being declared as governmental does not mean that the “specific activity at issue, in this case and under these circumstances, is a governmental function[,]” the Supreme Court addressed the two remaining factors. Id. at 513–14 (cleaned up).
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service is traditionally provided by a governmental entity, whether a substantial fee
is charged for the service provided, and whether that fee does more than simply cover
the operating costs of the service provider.” Bynum, 367 N.C. at 359.
1. Traditionally Provided by a Governmental Entity
As discussed above, providing recreation programs for physical activity is
traditionally a function of the government. E.g., Hickman, 108 N.C. App. at 84
(holding that the defendant-county offering free tennis instruction for children was a
traditional government function). Thus, this factor weighs in favor of Adult Free Play
basketball being a governmental activity.
2. Substantial Fee
Whether a substantial fee is charged can indicate whether an activity was done
for pecuniary gain. But the mere charging of a fee does not conclusively identify an
undertaking as proprietary. Indeed, we have rejected the idea that “one of the major
tests in labeling a government activity proprietary is whether a monetary fee is
involved.” McIver v. Smith, 134 N.C. App. 583, 586 (1999). Thus, it is not whether a
fee was charged that indicates whether an activity is a governmental function, but
whether the fee transforms the activity from one done for the “common good” to one
done “for pecuniary profit.” Id. at 587.
Instructive here is Willet v. Chatham County Board of Education, 176 N.C.
App. 268 (2006). There, we held that a school board’s operation of a basketball team
was a governmental function where the “admission fee of $1.00 for students and $2.00
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for parents was hardly ‘substantial’ and there [was] no evidence in the record to show
that the basketball admission charges generated enough revenue to pay for anything
other than the school’s athletic program.” Id. at 271–72.
Here, defendant charged $2.00 per session of the Adult Free Play basketball
program. Given that this Court has held that a $2.00 fee is “hardly substantial,” the
low amount charged indicates that defendant’s operation of this program is a
governmental function and not a proprietary one.3 Moreover, defendant would waive
the fee if a participant did not have money to pay for it. This further supports that
the primary purpose in operating the program was advancing the common good, not
generating revenue.
3. Revenue Generated Versus Operating Costs
Finally, we evaluate whether the fee did more than cover the cost of operation,
cognizant that an activity still may be deemed proprietary even if the revenue
generated falls short of covering operating costs. See, e.g., Sides v. Cabarrus Mem’l
Hosp., Inc., 287 N.C. 14, 24 (1975) (“[T]he fact that the operation as a whole is
nonprofitable is not determinative as to whether the activity will be classified as
3 In her reply brief, plaintiff asserts that the true cost of Adult Free Play basketball “was more
than $2.00—patrons were required to sign a waiver of liability, purportedly signing away their right to be compensated for any injuries that may occur because of [defendant’s] operation of the gymnasium.” But plaintiff cites no legal authority to support that a signed liability waiver increases the cost of the fee charged, so we consider this argument abandoned. See Fairfield v. WakeMed, 261 N.C. App. 569, 575 (2018) (“Plaintiffs do not cite any legal authority in support of this argument as required by the North Carolina Rules of Appellate Procedure. Therefore, we deem this issue to be abandoned.”).
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proprietary or governmental.”); Glenn v. City of Raleigh, 246 N.C. 469, 472, 477 (1952)
(earning $18,531.14 in net revenue from a public park after spending $25,125.01 on
maintenance expenses and $18,870.95 on recreation expenses for the park was a
“corporate benefit or pecuniary profit . . . to the [defendant-city] as to exclude the
application of governmental immunity.”).
For example, in Koontz v. City of Winston-Salem, our Supreme Court examined
whether the defendant-city was entitled to governmental immunity when it
contracted with the county in which the city was located to dispose of its garbage.
280 N.C. 513, 528 (1972). The General Assembly had authorized cities to
[S]ummarily remove, abate, or remedy . . . everything in the city limits, or within a mile of such limits, which is dangerous or prejudicial to the public health; and the expense of such action shall be paid by the person in default, and, if not paid, shall be a lien upon the land or premises where the trouble arose, and shall be collected as unpaid taxes.
Id. (omission in original) (quoting N.C.G.S. § 160-234). Under the contract with the
county, however, “licensed private collectors picked up garbage in areas outside of the
city limits and delivered it to the city’s landfill site.” Id. The defendant-city “received
9.39% of its cost for the landfill operations[,]” which was “over and beyond incidental
income.” Id. at 529–30. But it was not only the revenue generated that made this
activity proprietary:
By use of the contract, . . . the [defendant-city] could extend its protection against accumulated garbage and refuse for more than one mile from its territorial limits. Also, the
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[defendant-city] avoided the possibility of having to collect the cost of removal of garbage pursuant to the statute; and, further, avoided the very real possibility of litigation to enforce the lien provided by the statute. Thus, there were advantages under the contract with [the county] which inured to the [defendant-city’s] special corporate benefit and thereby brought defendant within the often announced rule that a municipality acts in a proprietary capacity when it receives special corporate benefit or pecuniary profit.
Id. (emphasis added) (cleaned up).4 Therefore, the defendant-city was not entitled to
governmental immunity for this undertaking. Id.
On the other hand, in Meinck v. City of Gastonia, the defendant-city rented out
some of its downtown properties to a local artistic nonprofit to “sublease portions of
the building to individual artists . . . to use as studios[.]” 371 N.C. at 498–99.
[T]he lease set[ ] rental rates for the . . . subtenants in a range of not more than $90.00 to $375.00 per month, of which 90% [was] paid to [the defendant-city]. Furthermore, [the defendant-city] receiv[ed] 15% of all sales or commissions under the lease, and subtenants [were] required to provide additional consideration in the form of volunteer time, with a minimum of fifteen hours per month.
Id. at 515. In one fiscal year, the defendant-city earned $21,572.98 from the subleases
but spent $33,062.01—netting a loss of $11,489.03, meaning the defendant-city
4 We note the Koontz Court also discussed Glenn v. City of Raleigh, and stated, as plaintiff
asserts here, that “the city received 11.7% of the cost of maintenance of its parks,” which was approximately $158,000 for all of the city’s parks, but only examined the net revenue of the park where the alleged tortious conduct occurred. 280 N.C. at 527 (citing Glenn, 246 N.C. at 472). Since Koontz, however, our Supreme Court has instructed that we examine “nuanced activity” in which the municipality is engaged: not the entire recreation or parks program budget. See Estate of Williams, 366 N.C. at 202.
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earned back about 65% of what it spent on the undertaking. Id. The following fiscal
year, the net loss was $18,072.86, so it earned approximately 55% of what it spent on
the activity that fiscal year. Id.
Our Supreme Court concluded these revenues were not “ ‘substantial,’
particularly because such revenues were not even designed to ‘simply cover the
operating costs of the service provider,’ nor did they do so in reality.” Id. (quoting
Estate of Williams, 366 N.C. at 202–03). The Court also noted that the activity was
of a “decidedly noncommercial nature” because “[a]rt occupies a unique role in our
society and our state[.]” Id. at 516. Accordingly, the defendant-city was entitled to
governmental immunity for that specific activity.
Here, the operation of Wagram Center in its entirety in 2020 netted a loss of
$106,190.86, meaning defendant earned back about 10% of what it spent to operate
Wagram Center. The following year, Wagram Center netted a loss of $123.045.12,
meaning defendant earned back about 4.5% of the operational cost. We do not know
precisely how much the fees from the Adult Free Play basketball program contributed
to those revenues. Considering the low fee charged for that program compared to the
higher fees charged for other activities, like annual memberships, the Adult Free Play
basketball program could at best have generated a small fraction of Wagram Center’s
annual revenue.
Even if we consider the revenue of Wagram Center as a whole, it is well below
the proportion of the revenue earned in Meinck, which supports a determination that
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this is a governmental function. On the other hand, the proportional cost of operating
Wagram Center is comparable to the cost of the waste disposal activity in Koontz,
where our Supreme Court held that the defendant-city engaged in a proprietary
activity. But unlike Koontz, where the contract gave the defendant-city advantages
that it did not have under the statute, defendant here does not partner with another
entity to give it such a benefit. Therefore, the total operating loss of Wagram Center
indicates that defendant operated Wagram Center for the common good and not for
its own pecuniary benefit, which supports the conclusion that defendant was entitled
to governmental immunity.
V. Conclusion
Defendant’ operation of the Adult Free Play basketball program is authorized
by the legislature and furthers its aim of offering recreation programs to citizens of
this State. The small fee charged, which defendant waived at times, and the
significant total operating loss for Wagram Center further demonstrate that
defendant’s activity was done for the good of the public, not for its own pecuniary
gain. Therefore, the trial court did not err by granting defendant’s motion for
summary judgment on the basis that defendant was entitled to governmental
immunity, and we affirm the trial court’s summary judgment order.
AFFIRMED.
Chief Judge DILLON and Judge HAMPSON concur.
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