NO. COA13-624

NORTH CAROLINA COURT OF APPEALS

Filed: 1 July 2014

WEAVER INVESTMENT COMPANY and 

TRAVEL CAMPS, INC., on their own 

behalf and on behalf of FOURTH 

CREEK LANDING HOUSING LIMITED 

PARTNERSHIP and FOURTH CREEK 

LANDING ASSOCIATES,

Plaintiffs,

v. Guilford County

No. 09 CVS 15378

PRESSLY DEVELOPMENT ASSOCIATES, 

PRESSLY DEVELOPMENT COMPANY, INC., 

DAVID L. PRESSLY, and EDWIN A.

PRESSLY,

Defendants.

Appeal by defendants from judgment entered 18 May 2011 by 

Judge John O. Craig, III in Guilford County Superior Court. 

Heard in the Court of Appeals 21 October 2013.

Brooks, Pierce, McLendon, Humphrey & Leonard, LLP, by S. 

Leigh Rodenbough IV and Charnanda T. Reid, for plaintiffappellees.

Eisele Ashburn Greene & Chapman, PA, by Douglas G. Eisele, 

for defendant-appellants.

STEELMAN, Judge.

Where alleged misconduct of certain defendants occurred 

within a partnership or joint enterprise, it was not “in or 
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affecting commerce” for the purposes of an unfair and deceptive 

trade practices action. The trial court erred in trebling 

damages and awarding attorney’s fees as to those parties

pursuant to the unfair and deceptive trade practices statute. 

The trial court had the authority to appoint an accountant to 

perform a forensic accounting of the entities and to assess the 

fees for the expert. Where defendants sought to introduce 

evidence that was outside of the scope of the hearing, the trial 

court did not abuse its discretion in excluding this evidence. 

Where there was evidence that defendants were responsible for 

depreciation in value of certain property, the trial court did 

not err in holding defendants liable for the depreciation. 

Where defendants offer no legal argument as to why the trial 

court could not dissolve the partnership, defendants’ argument 

is deemed abandoned. Where defendants do not challenge the 

trial court’s findings regarding breach of fiduciary duty and 

constructive fraud, the trial court did not err in its

conclusion based upon these findings. Where defendants 

concealed their misconduct, and this misconduct was reasonably 

discovered within the applicable statute of limitations periods, 

the trial court did not err in holding that the statute of 

limitations had not expired.
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I. Factual and Procedural Background

Weaver Investment Company (WIC) is one of three limited 

partners of Fourth Creek Landing Housing Limited Partnership 

(Fourth Creek Limited Partnership), with an 18.75% ownership 

interest. The other two limited partners are Travel Camps, 

Inc., (Travel) with a 37.5% interest, and Pressly Development 

Associates, (PDA) with an 18.75% interest. The general partner 

of the Partnership is Fourth Creek Landing Associates (FCLA), a 

general partnership, which holds a 25% interest in Fourth Creek 

Limited Partnership. WIC and PDA are the two general partners 

of FCLA, each with a 50% interest. The business relationship 

between WIC and PDA, as general partners of FCLA, is governed by 

a partnership agreement dated 16 May 1985. The business 

relationship between the general and limited partners of Fourth 

Creek Limited Partnership is governed by a limited partnership 

agreement, dated 16 May 1985, along with several amendments 

thereto.

Fourth Creek Limited Partnership owns the first phase of an 

apartment complex known as Fourth Creek Landing Apartments 

(Fourth Creek Apartments I) located in Iredell County. Pressly 

Development Company, Inc. (PDCI) is a corporation that manages 
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and leases the entire Fourth Creek Landing Apartments, which 

includes Fourth Creek Apartments I, and an additional 48 units 

(Fourth Creek Apartments II) owned by a separate company, Fourth 

Creek Landing Associates II, LLC (FCLA II). PDCI conducts the 

day to day business of Fourth Creek Apartments I and Fourth 

Creek Apartments II. PDCI charges fees to Fourth Creek Limited

Partnership for its services to Fourth Creek Apartments I. 

David Pressly (David) and Edwin Pressly (Edwin) are brothers who 

are the general partners of Free Nancy Partnership (Free Nancy), 

which is the sole member of FCLA II. David and Edwin each hold 

a 50% general partnership interest in PDA, and a 50% shareholder 

interest in PDCI. David is also the President of PDCI and the 

Manager of FCLA II. Edwin is a General Partner of PDA and the 

Secretary of PDCI.

On 22 December 2009, WIC and Travel filed this action 

against PDA and PDCI. They also brought this action on behalf 

of Fourth Creek Limited Partnership and FCLA. FCLA II was not a 

party to this action. The complaint alleged that PDA had acted 

ultra vires to the partnership agreement of Fourth Creek Limited 

Partnership, that PDCI or FCLA II had converted funds related to 

cable television services in Fourth Creek Apartments I, and that 

PDCI had engaged in inappropriate accounting practices with 
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regard to its management services for Fourth Creek Limited

Partnership. Plaintiffs sought monetary damages from 

defendants, termination of PDCI as property manager for Fourth 

Creek Apartments I, dissolution of FCLA, dissolution of Fourth 

Creek Limited Partnership, and monetary damages for breach of 

fiduciary duty against PDA.

On 19 August 2010, plaintiffs moved to join David and Edwin 

as defendants. This motion was granted 8 September 2010. On 10 

September 2010, plaintiffs filed an amended complaint. The 

amended complaint alleged additional causes of action for fraud 

against all four defendants; constructive fraud by PDA, David

and Edwin; aiding and abetting fraud and breach of contract by 

Edwin; unfair and deceptive trade practices as to all four 

defendants; establishment of a constructive trust with regard to 

the converted funds; punitive damages; and to pierce the 

corporate veil of PDCI under an alter ego theory. Plaintiffs 

further alleged that David, having volunteered to locate a real 

estate broker in order to sell the property of Fourth Creek 

Apartments I, delayed doing so in an attempt to maximize his 

profits for FCLA II and PDCI; that David executed and recorded a 

cross-easement between Fourth Creek Apartments I and Fourth 

Creek Apartments II without authority, and failed to disclose
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that action; and that David executed a management agreement, 

ostensibly on behalf of Fourth Creek Limited Partnership, 

without authorization.

On 11 October 2010, defendants filed an answer and motion 

to dismiss pursuant to Rule 12(b)(6) of the North Carolina Rules 

of Civil Procedure. On 17 December 2010, plaintiffs voluntarily 

dismissed their claim for dissolution of Fourth Creek Limited 

Partnership pursuant to Rule 41 of the Rules of Civil Procedure. 

All parties waived a jury trial pursuant to Rule 38(d) of the 

Rules of Civil Procedure.

On 18 May 2011, following a hearing, the trial court 

entered judgment. The trial court found that David, on his own 

behalf and on behalf of PDA and PDCI, had misled plaintiffs;

engaged in unauthorized conduct; overcharged Fourth Creek 

Limited Partnership; failed to make payments owed to Fourth 

Creek Limited Partnership; purposefully delayed in obtaining a 

broker to sell the property of Fourth Creek Apartments I in 

order to increase revenues for PDCI and FCLA II; converted funds 

from Fourth Creek Limited Partnership; used PDA and PDCI as his

alter ego; and engaged in unfair and deceptive trade practices. 

The trial court concluded that PDCI, through David, had breached 

its fiduciary duty to Fourth Creek Limited Partnership, and had 
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engaged in constructive fraud; that PDA, through David, had 

breached its fiduciary duty to FCLA and to Fourth Creek Limited 

Partnership, and had engaged in constructive fraud; that David, 

PDA and PDCI had engaged in fraud; that Edwin did not aid and 

abet in the breaches of fiduciary duty of PDA and PDCI; that 

David, PDA and PDCI had engaged in unfair and deceptive trade 

practices; that David was individually liable for the torts of 

PDCI; that David and Edwin, as owners of PDCI, were personally 

liable for the liability attributable to PDCI under a piercing 

the corporate veil theory; that David and Edwin, as general 

partners in PDA, were personally liable for the liability 

attributable to PDA; and that Edwin’s conduct was such as to not 

merit treble damages, which were assessed against David, PDA and 

PDCI. The trial court further concluded that plaintiffs did not 

meet their burden of proving damages with regard to David’s 

alleged delay in listing the property of Fourth Creek Apartments

I for sale, his recordation of a cross-easement without 

authority, and his unauthorized execution of a management 

agreement, and that only nominal damages were appropriate for 

these claims. The trial court also concluded that David, Edwin, 

and Free Nancy reasonably relied on the business judgment rule 

with regard to unauthorized loans David had taken out as 
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business necessities. The trial court ordered that an 

accounting of PDCI’s books and records be conducted, the 

dissolution of FCLA, and held that, because defendants’ actions 

did not cease three years before the filing of the suit against 

them, the continuing wrong doctrine barred defendants from 

asserting a statute of limitations defense.

The trial court awarded Fourth Creek Limited Partnership 

damages in the amount of $176,000.00 for defendants’ concealment 

of revenue, $226,464.00 for defendants’ concealment of losses 

resulting from the unauthorized housing of on-site employees at 

Fourth Creek Apartments I, $46,872.00 for defendants’ 

overcharging services to Fourth Creek Limited Partnership, $1.00 

nominal damages for defendants’ unauthorized execution and 

recordation of the cross-easement, $1.00 nominal damages for 

defendants’ unauthorized execution of a management agreement, 

and $1.00 nominal damages for defendants’ purposeful delay in 

retaining a broker for the purpose of selling the property of

Fourth Creek Apartments I. The trial court held that Edwin 

would not be subject to treble damages. The trial court also 

determined that Fourth Creek Limited Partnership was entitled to 

an award of attorney’s fees from PDA, PDCI and David. The trial 

court held that the damages awarded were subject to adjustment 
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based upon an accounting of the books and records of PDCI. The 

trial court appointed a receiver for Fourth Creek Limited

Partnership and FCLA, terminated PDCI as property manager for 

Fourth Creek Apartments I, and ordered a forensic accounting of 

PDCI’s books. The trial court also ordered an accounting of the 

replacement cost of the amenities and facilities of Fourth Creek 

Apartments I, which Fourth Creek Limited Partnership would be 

entitled to collect as damages from defendants. The trial court 

also ordered that PDA’s share of Fourth Creek Limited 

Partnership be redeemed. The trial court ordered the 

dissolution of FCLA, but not of Fourth Creek Limited

Partnership, and the termination of the cross-easement between 

Fourth Creek Apartments I and Fourth Creek Apartments II. 

Finally, the trial court held that the unauthorized satellite

television equipment installed by defendants was the property of 

Fourth Creek Limited Partnership, as its value was less than the 

unpaid rent that was owed by defendants to Fourth Creek Limited 

Partnership. The judgment also provided that these damages 

could be modified based upon the future accounting.

On 20 June 2012, the trial court entered its supplemental 

judgment as to damages, based upon the accounting of the books 

and records of PDCI. It held that the net fair market value of 
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Fourth Creek Apartments I was $1,233,295.00; that PDA’s net 

interest in Fourth Creek Limited Partnership was worth 

$385,405.00; that the total cost for site improvements to FCLA

was $90,000.00; and that the total replacement damages for FCLA

were $160,000.00. The trial court held that Fourth Creek 

Limited Partnership was entitled to recover from defendants 

$131,599.00 for the conversion of satellite television revenue, 

plus $45,249.00 interest. The court further held that the 

principal portion of these damages was trebled with respect to 

PDA, PDCI, and David, for a total amount of $394,797.00.1

The trial court also held that Fourth Creek Limited 

Partnership was entitled to recover from defendants $13,851.00 

for the assessment of management fees relating to the satellite 

television revenue, plus $5,015.00 interest. The principal

portion of these damages was trebled with respect to PDA, PDCI, 

and David, for a total amount of $41,553.00.

The trial court also held that Fourth Creek Limited 

Partnership was entitled to recover from defendants $41,385.00 

for unauthorized housing of employees, plus $13,881.00 interest. 

The principal portion of these damages was trebled with respect

to PDA, PDCI, and David, for a total amount of $124,155.00.

 

1 All damages that were trebled were pursuant to Chapter 75 of 

the North Carolina General Statutes.
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The trial court also held that Fourth Creek Limited 

Partnership was entitled to recover from defendants $162,369.00 

for the unauthorized income to Fourth Creek Apartments II based 

upon the unauthorized housing of employees, plus $62,926.00 

interest. The principal portion of these damages was trebled 

with respect to PDA, PDCI, and David, for a total amount of 

$487,107.00.

The trial court also held that Fourth Creek Limited 

Partnership was entitled to recover from defendants $32,880.00 

based upon defendants’ overcharging of salaries and expenses, 

plus $13,999.00 interest. The principal portion of these 

damages was trebled with respect to PDA, PDCI, and David, for a 

total amount of $98,640.00.

The trial court also held that Fourth Creek Limited 

Partnership was entitled to recover from defendants $105,478.00 

for the unauthorized collection of undisclosed bookkeeping fees 

beyond those contractually agreed upon by the parties, plus 

$53,998.00 interest. The principal portion of these damages was

trebled with respect to PDA, PDCI, and David, for a total amount

of $316,434.00.

The trial court also held that Fourth Creek Limited 

Partnership was entitled to recover from defendants $48,000.00 
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for failure to pay its share of the amenities of Fourth Creek 

Apartments I, plus $35,531.00 interest. The principal portion 

of these damages was trebled with respect to PDA, PDCI, and 

David, for a total amount of $144,000.00.

The trial court also held that Fourth Creek Limited 

Partnership was entitled to recover from defendants $1.00 in 

nominal damages for the unauthorized execution and recordation 

of the 2001 Cross-Easement, $1.00 in nominal damages for the 

execution of the 1996 Management Agreement, and $1.00 in nominal 

damages for purposeful delay in contracting with a real estate 

broker.

In total, the trial court held that Fourth Creek Limited 

Partnership was entitled to $535,562.00, plus interest of 

$230,599.00, for a total of $766,161.00. The principal amounts 

were trebled to $1,606,686.00 with respect to PDA, PDCI, and 

David. All of the defendants were liable for the total of $3.00 

in nominal damages. The trial court credited $385,405.00 

against these damages based upon PDA’s redemption of its 

interest in Fourth Creek Limited Partnership. The trial court 

further held that plaintiffs were entitled to recover from 

defendants $306,380.34 in reasonable attorney’s fees, $5,500.00

for the cost of an appraisal of the Fourth Creek Apartments I 
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amenities, $68,854.48 for the forensic audit, and $787.50 in 

expert witness fees for the testimony of the court-appointed 

appraiser.

Defendants appeal.

II. Standard of Review

“The standard of review on appeal from a judgment entered 

after a non-jury trial is ‘whether there is competent evidence 

to support the trial court’s findings of fact and whether the 

findings support the conclusions of law and ensuing judgment.’” 

Cartin v. Harrison, 151 N.C. App. 697, 699, 567 S.E.2d 174, 176 

(quoting Sessler v. Marsh, 144 N.C. App. 623, 628, 551 S.E.2d 

160, 163 (2001)), disc. review denied, 356 N.C. 434, 572 S.E.2d 

428 (2002).

Defendants have not challenged the trial court’s findings 

of fact.2 These findings are therefore binding upon this court. 

Koufman v. Koufman, 330 N.C. 93, 97, 408 S.E.2d 729, 731 (1991). 

Our review is therefore limited to whether the trial court’s 

findings support its conclusions of law.

III. Unfair and Deceptive Trade Practices

 

2 Defendants mischaracterize the court’s conclusions of law that 

defendants breached their fiduciary duty and engaged in 

constructive fraud as findings of fact; they are not findings of 

fact, but conclusions of law.
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In their first argument, defendants contend that the trial 

court erred in concluding that defendants’ acts were “in or 

affecting commerce” in North Carolina. We agree in part.

Pursuant to N.C. Gen. Stat. § 75-1.1, “[i]n order to 

establish a prima facie claim for unfair trade practices, a 

plaintiff must show: (1) defendant committed an unfair or 

deceptive act or practice, (2) the action in question was in or 

affecting commerce, and (3) the act proximately caused injury to 

the plaintiff.” Dalton v. Camp, 353 N.C. 647, 656, 548 S.E.2d 

704, 711 (2001).

Our Supreme Court has held that N.C. Gen. Stat. § 75-1.1 

does not apply within the confines of a partnership. See White 

v. Thompson, 364 N.C. 47, 691 S.E.2d 676 (2010). In White, the 

defendant, a partner in the Ace Fabrication and Welding entity, 

diverted work from the partnership prior to his departure from 

the business, and improperly maintained accounts. Plaintiffs 

brought action against defendant, alleging breach of fiduciary 

duty. The trial court ruled in favor of plaintiffs, and granted 

plaintiffs treble damages. Id. at 47-51, 691 S.E.2d at 676-78. 

On appeal, a majority of this Court reversed the treble damages, 

holding that defendant’s usurpation of partnership opportunities 

was not “in or affecting commerce” under our Unfair and 
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Deceptive Trade Practices statute. The majority otherwise 

affirmed the trial court’s decision. Id. at 51, 691 S.E.2d at 

678-79. The Supreme Court held that “[o]ur prior decisions have 

determined that the General Assembly did not intend for the 

Act's protections to extend to a business's internal 

operations.” Id. at 53, 691 S.E.2d at 680. It affirmed the 

decision of the Court of Appeals, concluding that defendant’s 

conduct within the partnership was not “in or affecting 

commerce.”

The facts of the instant case show that PDA was a member of 

Fourth Creek Limited Partnership; that David and Edwin were the 

general partners of PDA; that defendants, through PDCI, were 

engaged by Fourth Creek Limited Partnership to operate Fourth 

Creek Apartments I; and that defendants engaged in various acts 

inconsistent with their obligations to Fourth Creek Limited 

Partnership.

We hold that, while the evidence in the record supports the 

trial court’s findings that defendants committed fraud, delayed 

in the sale of real property, and had a duty to provide an 

accounting to plaintiffs, it also clearly shows the status of 

David, Edwin, and PDA as partners within the Fourth Creek 

Limited Partnership joint enterprise. Pursuant to the Supreme 
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Court’s decision in White v. Thompson, defendants’ misconduct 

within the confines of the partnership was not “in or affecting 

commerce,” and therefore does not invoke N.C. Gen. Stat. § 75-

1.1 or its trebling provisions. We hold that, while the trial 

court did not err in imposing damages against David, Edwin, and 

PDA for their misconduct, it erred in trebling the damages 

against David and PDA with regard to satellite revenue, employee 

housing, bookkeeping, salaries and expenses, and failure to 

maintain amenities, pursuant to North Carolina’s Unfair and 

Deceptive Trade Practices statute, specifically N.C. Gen. Stat. 

§ 75-16. Additionally, because the award of attorney’s fees was 

made pursuant to N.C. Gen. Stat. § 75-16.1, based upon 

defendants’ alleged violations of the Unfair and Deceptive Trade 

Practices statute, we hold that the trial court erred in 

awarding attorney’s fees to plaintiffs, with regard to David, 

Edwin and PDA.

PDCI, however, was not a member of the Fourth Creek Limited 

Partnership. The trial court found that PDCI “has served as the 

property manager and leasing manager . . . for the entire Fourth 

Creek Landing Apartments . . . [and] controls the day to day 

affairs of the Fourth Creek Landing Apartments[.]” Although the 

conduct of David, Edwin, and PDA was within the partnership 
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context, and thus was not “in or affecting commerce,” PDCI was a 

separate entity hired by Fourth Creek Limited Partnership.

Our Supreme Court has held that an employee’s fraudulent 

self-dealing misconduct “[did] not preclude applicability of 

N.C.G.S. § 75–1.1 to [his] case.” Sara Lee Corp. v. Carter, 351 

N.C. 27, 34, 519 S.E.2d 308, 312 (1999). In Sara Lee, plaintiff 

Sara Lee hired defendant to “develop[] and maintain[] 

relationships with vendors to provide [Sara Lee Knit Products] 

with the best possible pricing, availability, and support of 

hardware and services.” Id. at 29, 519 S.E.2d at 309. 

Defendant was “authorized and entrusted to order and purchase 

computer parts at the lowest possible prices[,]” and was 

“responsible for the maintenance and repair of personal 

computers.” Id. During his employment with Sara Lee, defendant 

“developed four separate businesses . . . through which he 

engaged in self-dealing by supplying Sara Lee with computer 

parts and services at allegedly excessive cost while concealing 

his interest in these businesses. Sara Lee paid a total of 

$495,431.54 to defendant's businesses for parts and services.” 

Id.

When Sara Lee brought action against defendant for this 

fraud, the trial court ruled in favor of Sara Lee, holding that 
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“[t]he transactions between Sara Lee and the Carter Enterprises 

were not open, fair and honest. In fact, the clear, cogent, and 

convincing evidence is, to the contrary, that [defendant] used 

his position of trust at Sara Lee to make profits on 

transactions involving the Carter Enterprises without disclosing 

his financial interest in the Carter Enterprises to his

superiors at Sara Lee.” Id. at 30, 519 S.E.2d at 310. This 

Court agreed, holding that “[d]efendant breached his fiduciary 

duty by selling computer parts to Sara Lee without disclosing 

his interest in the companies supplying these parts.” Id. 

(quoting Sara Lee Corp. v. Carter, 129 N.C. App. 464, 471, 500 

S.E.2d 732, 737 (1998)). However, this Court then held that 

the defendant did not violate § 75-1.1, because he was employed 

by Sara Lee at the time of the fraud.

Our Supreme Court reversed, concluding that defendant’s 

conduct was “in or affecting commerce,” and that,

having already characterized defendant's 

conduct as buyer-seller transactions that 

fall squarely within the Act's intended 

reach, we conclude that defendant's 

relationship to plaintiff as an employee, 

under these facts, does not preclude 

applicability of N.C.G.S. § 75–1.1 to this 

case. Even though defendant was an employee, 

he nevertheless engaged in self-dealing 

conduct and “business activities.” N.C.G.S. 

§ 75–1.1(b). On these facts, defendant's 

mere employee status at the time he 
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committed these acts does not safeguard him 

from liability under the Act.

Id. at 34, 519 S.E.2d at 312.

If an employee can be held liable under § 75-1.1, it seems 

clear that an independent contractor, such as PDCI, may also be 

held liable. Accordingly, we hold that the trial court did not 

err in trebling damages and awarding attorney’s fees with regard 

to PDCI. Further, because the trial court concluded that David 

was individually liable for the torts committed by PDCI under a 

veil-piercing theory, David is subject to the same trebling of 

damages and attorney’s fees to which PDCI is subject.

We vacate the portions of the trial court’s order trebling 

damages and awarding attorney’s fees against David, Edwin and 

PDA, as members of Fourth Creek Limited Partnership, pursuant to 

the Unfair and Deceptive Trade Practices statute, and remand for 

an order reducing damages accordingly. We affirm the judgment 

of the trial court trebling damages and awarding attorney’s fees 

with regard to PDCI, and David individually based upon a 

piercing the corporate veil theory through PDCI.

IV. Awards of Fees, Costs and Damages

In their second, third, fourth, fifth, sixth, seventh, 

eighth, ninth, and tenth arguments, defendants contend that the 

trial court erred in awarding attorney’s fees and bookkeeping 
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fees, in basing its damages upon the testimony of an expert

witness and denying defendants the opportunity to rebut that 

testimony, in awarding as costs the fees of expert witnesses, in 

awarding damages for the depreciation in value of Fourth Creek 

Apartments I, in basing damages upon the fair market value of 

Fourth Creek Apartments I, and in removing PDCI from the 

Partnership.3

A. Attorney’s Fees

Defendants first contend that the trial court erred in 

awarding attorney’s fees. We agree in part.

The trial court awarded attorney’s fees pursuant to N.C. 

Gen. Stat. § 75-16.1. This statute provides:

In any suit instituted by a person who 

alleges that the defendant violated G.S. 75-

1.1, the presiding judge may, in his 

discretion, allow a reasonable attorney fee 

to the duly licensed attorney representing 

the prevailing party, such attorney fee to 

be taxed as a part of the court costs and 

payable by the losing party, upon a finding 

by the presiding judge that:

(1) The party charged with the violation 

has willfully engaged in the act or 

practice, and there was an unwarranted 

 

3 Defendants contend that the trial court erred in removing PDCI 

as a member of the partnership. However, the trial court did 

not remove PDCI; it removed FCLA, and its half-owner PDA, from 

the partnership.
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refusal by such party to fully resolve the 

matter which constitutes the basis of such 

suit; or

(2) The party instituting the action knew, 

or should have known, the action was 

frivolous and malicious.

N.C. Gen. Stat. § 75-16.1 (2013). As we held above, the trial 

court erred in concluding that certain defendants violated N.C. 

Gen. Stat. § 75-1.1. Accordingly, the trial court erred in 

awarding attorney’s fees pursuant to N.C. Gen. Stat. § 75-16.1

against David, Edwin, and PDA, as members of Fourth Creek 

Limited Partnership; the trial court did not err in awarding 

attorney’s fees against PDCI, or against David who was 

individually liable for the actions of PDCI under a veilpiercing theory. As described in Section III of this opinion, 

we vacate the award of attorney’s fees with respect to David, 

Edwin and PDA, and find no error with respect to PDCI, and David 

through PDCI. As discussed in Section III of this opinion, 

above, we remand with instructions for the trial court to award 

fees only against PDCI, and David through PDCI.

B. Bookkeeping Fees

Defendants next contend that the trial court erred by 

awarding bookkeeping fees, by relying on the testimony of Eric 
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Lioy in setting those fees, and by denying defendants the 

opportunity to rebut Lioy’s testimony. We disagree.

Eric Lioy is a Grant Thornton accountant who was charged by 

the court to provide an accounting of PDCI’s expenses for 

“things such as satellite television revenue, employee housing, 

affects [sic] of the management fee and a couple other 

matters[.]” The trial court’s judgment does not cite to his 

testimony, because Lioy did not testify at trial, but testified 

instead at a separate hearing, on 10 October 2011. Regarding 

Lioy’s testimony, the trial court held that:

Now, this is really just designed -- I'm not 

-- I'm not going to treat it as an 

evidentiary hearing, but I'm going to treat 

it as a way of this witness helping me and 

Mr. Eisele go through the book[s] and -- or 

the documents and sort of just take me 

through it step by step as to what it -- how 

it's comprised and how -- what findings were 

made and just sort of take me through it as 

kind of a guideline or road map.

At this hearing, Lioy testified under oath that he and his 

team performed the services requested by the court, which also 

included forensic accounting, searches of computer documents, 

and double-checking of accounting calculations between “January 

1, 2002 through March 31, 2011.” Lioy went on to testify to the 

contents of his report, which had been previously submitted to 

the trial court. At no point did defendants object to Lioy’s 
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testimony. Defendants did object, however, to “this $159,000 

item[,]” referring to a $159,176.00 item in the report, which 

was bookkeeping fees paid by Fourth Creek Apartments I to PDCI 

in 1999, plus interest. Defendants contended at the hearing 

that this item

was not raised in the pleadings, it was 

never suggested during the trial, there was 

no mention of it made in oral argument at 

any time, it was not the subject of any 

amendment to the pleadings made at the 

conclusion of the trial. I didn't know 

anything about it until the Grant Thornton 

report came down and I'm sure Mr. Rodenbough 

didn't know about it until the Grant 

Thornton report came down.

The trial court noted defendants’ objection, but held that 

“that's something we're going to need to take up at a subsequent 

hearing.”

The hearing was recessed, and subsequently reconvened on 2 

December, 2011. At this hearing, defendants once again objected 

to the bookkeeping fees, asserting that “[t]he word bookkeeping 

fees never came up.” The trial court responded, however, that 

“Mr. Eisele, my recollection of things and my concept of things 

are different from yours.” The trial court overruled 

defendants’ objection, and considered the evidence.

The trial court’s order did not refer to Lioy’s testimony. 

Instead, as defendants concede, 
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there is nothing in the record except the 

Grant Thornton report (presented at a 

hearing deemed not to be "evidentiary") 

pertaining to bookkeeping fees, save and 

except (1) par. 8.7(c) of the Limited 

Partnership Agreement (Ps' Ex 3) allowing as 

Expenses "(c) legal, audit, accounting, 

brokerage and other fees", and (2) 

Defendants' Exhibit H-2, which reveals 

bookkeeping fees in addition to PDC's 6% 

commission dating back to 1999.

Defendants acknowledge the existence of evidence to support 

the trial court’s finding that PDCI charged bookkeeping fees; 

the fact that the trial court may or may not have additionally 

relied upon Mr. Lioy’s testimony is irrelevant. This evidence 

supports a finding that PDCI charged fees for bookkeeping, which 

as stated above supports an order awarding those fees as damages 

to plaintiffs.

The trial court found that PDCI had charged plaintiffs for 

bookkeeping, while PDCI used its own formulae on Fourth Creek 

Limited Partnership’s books to conceal the treatment of 

particular expenses. As a result of the commingling of assets 

between defendants and Fourth Creek Limited Partnership, the 

trial court ordered that forensic investigators “inquire into . 

. . failures by [PDCI] to properly calculate, allocate and/or 

charge to [Fourth Creek Limited Partnership] any management 

fees, bookkeeping fees, employee reimbursements or other expense 
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reimbursements,” which the Partnership would be entitled to 

receive as damages. PDCI charged plaintiffs for bookkeeping 

services, and then fraudulently concealed expenses from 

plaintiffs on those books. We therefore hold that, where PDCI

used its authority as bookkeeper to fraudulently conceal 

expenses, the trial court did not err in awarding damages to 

plaintiffs based upon the bookkeeping fees charged by PDCI.

This argument is without merit.

C. Defendants’ Evidence on Bookkeeping Fees

At the hearings before the trial court to address the 

amount of damages, attorney’s fees and costs to be awarded to 

plaintiffs, defendants sought to introduce evidence that 

defendants were entitled to charge fees for the bookkeeping 

defendants performed. Defendants intended to use this evidence 

to rebut plaintiffs’ claims that defendants’ fees were 

fraudulent, and sought to make an offer of proof before the 

trial court. The trial court excluded this evidence. 

Defendants contend that this exclusion was error. We disagree.

We note first that the trial court’s decisions to admit or 

exclude evidence are reviewed for abuse of discretion. State v. 

Whaley, 362 N.C. 156, 160, 655 S.E.2d 388, 390 (2008).
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In its 18 May 2011 order, the trial court found that 

defendants used accounting procedures to improperly allocate 

expenses to Fourth Creek Landing Partnership. Preliminary 

damages were awarded to plaintiffs, subject to being increased 

or decreased based upon a forensic accounting ordered by the 

court. At the hearings on the amount of damages, defendants 

sought to introduce evidence as to “the propriety of charging 

bookkeeping expenses as a project cost to the project and not to 

be included in the six percent management fee . . .”

The trial court held that it had already ruled on the 

liability issue in its 18 May 2011 order, and that the current 

hearing was limited to damages. Since the evidence offered by 

defendants went to liability rather than damages, the trial 

court excluded the evidence. We discern no abuse of discretion 

on the part of the trial court in the exclusion of this 

evidence.

This argument is without merit.

D. Court-Ordered Accounting

In a supplemental order and judgment on damages dated 12 

June 2012, the trial court ruled that the fees of the forensic 

accountants ordered to examine the books of Fourth Creek Limited 
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Partnership and PDCI were costs recoverable by plaintiffs. 

Defendants contend that the trial court erred in awarding these

fees as costs against defendants. We disagree.

Pursuant to the North Carolina Rules of Evidence, an expert 

appointed by the court is “entitled to reasonable compensation 

in whatever sum the court may allow. . . . In other civil 

actions and proceedings the compensation shall be paid by the 

parties in such proportion and at such time as the court 

directs, and thereafter charged in like manner as other costs.” 

N.C. R. Evid. 706.

Defendants contend that the forensic accountants were not 

court-appointed experts, but plaintiffs’ experts, and thus that 

these fees should not have been taxed as costs. Defendants 

argue that the accountants never provided defendants with a copy 

of their findings. The testimony cited by defendants shows that 

the accountant, Lioy, did not provide defendants with a copy of 

his report. However, this same testimony indicates that 

defendants never sought this report, and that Lioy had discussed 

the contents of the report at length with defendants.

Defendants further contend that another court-appointed 

accountant, Nancy Tritt, engaged in extensive ex parte 

communications with plaintiffs. However, defendants merely 
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assert that there were contacts between plaintiffs and the 

expert; defendants present no evidence that such contacts were 

improper. Defendants further concede that there are times when 

ex parte contact with a court-appointed expert is not improper. 

See Point Intrepid, LLC v. Farley, ___ N.C. App. ___, ___, 714 

S.E.2d 797, 802-03 (2011). In the instant case, the record 

demonstrates that the trial court ordered that forensic 

accountants perform “a complete accounting of the books and 

records maintained by [PDCI] for [Fourth Creek Limited 

Partnership] and [Fourth Creek Apartments I][.]” There is no 

evidence that these experts were deposed by either party. There 

is no evidence that the accountants were not court-appointed 

experts, nor that any improper contact occurred. There is 

evidence to show that these were court-appointed experts, and we 

therefore hold that the trial court did not err in awarding 

their fees as costs.

This argument is without merit.

F. Damages

Defendants next contend that the trial court erred in 

awarding damages for the depreciated value of the amenities on 

Fourth Creek Apartments I as a result of PDCI’s management, and

awarding damages based upon the value of the property itself. 
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Defendants contend that the only parties which caused the 

depreciation were FCLA II and Free Nancy, neither of which was a 

party to this lawsuit, and that this award was simply a means of 

bypassing issues of joinder. However, the trial court held that 

it was defendants, acting through FCLA II and Free Nancy, that

caused the actions which led to the depreciation of the 

amenities. Accordingly, the trial court did not err in holding 

defendants liable for the depreciation in value caused by their 

actions.

This argument is without merit.

G. Dissolution

Defendants also contend that the trial court erred in 

removing PDCI from Fourth Creek Limited Partnership. Defendants 

contend that, absent total dissolution of Fourth Creek Limited

Partnership, there is no legal basis for the removal of PDCI. 

We first note that PDCI was not removed from the partnership; 

FCLA, and its half-owner PDA, were removed from the partnership.

Even assuming that defendants were contending that the 

trial court erred in removing PDA, however, defendants do not 

cite this Court to any authority indicating that the trial court 

lacked the authority to remove FCLA and PDA. Accordingly, 
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defendants’ argument on this point is deemed abandoned. See

N.C. R. App. P. 28(b)(6).

This argument is without merit.

V. Breach of Duty and Constructive Fraud

In their eleventh argument, defendants contend that the 

trial court erred in finding that PDCI and PDA breached 

fiduciary duty to Fourth Creek Limited Partnership and FCLA and 

engaged in constructive fraud. We disagree.

The trial court found as fact that defendants had converted 

funds, had engaged in unauthorized and ultra vires conduct, had 

profited without informing Fourth Creek Limited Partnership, and 

had delayed in taking actions beneficial to Fourth Creek Limited

Partnership in order to maximize their own profits. Defendants 

do not challenge these findings; rather, they assert that their 

conduct was entirely legal. The trial court’s findings support 

the conclusion that defendants breached their fiduciary duty and 

engaged in constructive fraud.

This argument is without merit.

VI. Statute of Limitations

In their twelfth argument, defendants contend that the 

trial court erred in concluding that plaintiffs’ claims were not 

barred by the statute of limitations. We disagree.
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The trial court examined defendants’ affirmative defense of 

the statute of limitations extensively. It concluded that (1) 

because defendants engaged in continuing conduct that had not 

ceased prior to three years before the filing of the instant 

lawsuit, the continuing wrong doctrine prevented the statute of 

limitations from running; (2) because defendants actively 

concealed their wrong from plaintiffs, the doctrine of equitable 

estoppel prevented them from relying upon their concealment to 

cause the statute of limitations to expire; (3) plaintiffs’ 

claims for dissolution are not subject to the statute of 

limitations, since the statute would only begin to run from the 

time of discovery of defendants’ wrongdoing; (4) plaintiffs’ 

claim for unfair and deceptive trade practices is governed by a 

four-year statute of limitations, N.C. Gen. Stat. § 75-16.2,

which begins to run when the fraud is discovered or should have 

been discovered, rather than when the act is committed, see Nash 

v. Motorola Communications and Electronics. Inc., 96 N.C. App. 

329, 331-32, 385 S.E.2d 537, 538 (1989); and (5) plaintiffs’

remaining claims were governed by a ten-year statute of 

limitations, N.C. Gen. Stat. § 1-56, which had not expired at 

the time the lawsuit was filed. The trial court based these 

conclusions on its findings that this action was filed in 2009; 
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that operation of the satellite television system was disclosed 

to Fourth Creek Limited Partnership in a meeting in 2009; that 

plaintiffs could not have reasonably discovered defendants’ onsite housing of employees until this information was revealed in 

2009; that defendants were assessing disproportionate costs to 

Fourth Creek Limited Partnership as recently as October 2009; 

and that these costs were not revealed until late 2009. 

Defendants do not challenge these findings; instead, defendants 

contend that plaintiffs’ negligence, not defendants’ 

concealment, was the cause of plaintiffs’ late discovery of 

defendants’ conduct, and that the statute of limitations should 

bar plaintiffs’ claims. As defendants do not challenge the 

trial court’s findings, they are binding upon this Court on 

appeal. Koufman 330 N.C. at 97, 408 S.E.2d at 731. These 

findings support the trial court’s conclusion that the statute 

of limitations did not bar plaintiffs’ claims.

This argument is without merit.

VII. Conclusion

The portions of the trial court’s judgment awarding trebled

damages and attorney’s fees pursuant to N.C. Gen. Stat. § 75-1.1 

et seq. against David, Edwin, and PDA, are vacated. The trial 

court, upon remand, shall award damages for these claims, 
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without trebling. The portions trebling damages and awarding 

attorney’s fees against PDCI, and David through PDCI, are 

affirmed. All other aspects of the trial court’s order are 

affirmed.

VACATED AND REMANDED IN PART, AFFIRMED IN PART.

Chief Judge MARTIN and Judge DILLON concur.