Court Opinion

ID: 2727135
Source: CourtListenerOpinion
Date Created: 2014-09-08 21:11:58.257902+00
Date Added: 2024-06-11T09:28:42.578113
License: Public Domain

An unpublished opinion of the North Carolina Court of Appeals does not constitute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
A   p   p    e   l   l   a    t   e       P   r    o   c   e   d   u    r   e   .

                               NO. COA14-119
                      NORTH CAROLINA COURT OF APPEALS

                             Filed:       15 July 2014

MICHAEL A. DEMAYO and KELLIE H.
DEMAYO,
     Plaintiffs,

      v.                                    Mecklenburg County
                                            No. 12 CVS 19847
STONE BY LYNCH, LLC, and L.C.
LYNCH, a/k/a L.C. Lynch, Jr.,
     Defendants.

      Appeal by defendants from order entered 17 September 2013

by Judge Richard D. Boner in Mecklenburg County Superior Court.

Heard in the Court of Appeals 19 May 2014.

      Horack, Talley, Pharr & Lowndes, P.A., by Gregory                            L.
      Shelton and John W. Bowers, for plaintiffs–appellees.

      Kenneth T. Davies, for defendants–appellants.

      MARTIN, Chief Judge.

      Defendants Stone By Lynch, LLC and L.C. Lynch a/k/a L.C.

Lynch,     Jr.   appeal    from    an   order     denying   their   motion,     made

pursuant    to    N.C.G.S.      § 1A-1,    Rules 60    and 68.1,    to    vacate    a

1 November 2012 judgment entered against them and in favor of

plaintiffs       Michael   A.     DeMayo    and    Kellie   H.   DeMayo    by   the
                                         -2-
Mecklenburg County Clerk of Court.              We affirm.

       Our   recitation      of   the   facts     and    procedural    history    is

limited to those events relevant to the issues presented on

appeal.        Plaintiffs    engaged     JAS-AM,     Inc.,    a    North    Carolina

general contractor, to build a new residential home for them in

Charlotte,     North   Carolina.         In    November 2009,      JAS-AM     entered

into a construction subcontract with defendant Stone By Lynch to

furnish and install all of the limestone and other stone masonry

work required for plaintiffs’ new residence.                      In January 2010,

defendant      Stone   By   Lynch     entered     into   a   second-tier       supply

agreement with Riverside Cut Stone, Inc. (“Riverside”) to supply

the limestone for plaintiffs’ construction project.

       In December 2011, Riverside filed a subrogation claim of

lien    with    the    Mecklenburg       County    Clerk     of     Court    against

plaintiffs’ property, and filed a lien enforcement action in

Mecklenburg      County     against     plaintiffs,      JAS-AM,    and     defendant

Stone By Lynch.           In turn, defendant Stone By Lynch filed a

subrogation claim of lien against plaintiffs’ property in the

amount of $91,881.00, and filed cross-claims against plaintiffs

and JAS-AM in Riverside’s lien enforcement action.                     Riverside’s

subrogation claim of lien was discharged after plaintiffs and

JAS-AM posted a cash bond with the Mecklenburg County Clerk of

Court in the amount of the lien totaling $255,626.00; no bond
                                           -3-
was     posted     with     respect       to     defendant     Stone    By   Lynch’s

subrogation claim of lien.

      On 21 January 2012, defendant L.C. Lynch, Jr., the manager

of Stone By Lynch, met with plaintiff Michael A. DeMayo and

Sajjan Dhaliwal, the president of JAS-AM, at plaintiff DeMayo’s

request.      At this meeting, plaintiff DeMayo presented defendant

Lynch with a Settlement Agreement and Confession of Judgment for

Lynch’s signature.              The Settlement Agreement provided that the

parties——plaintiffs,            JAS-AM,    defendant       Stone   By   Lynch,    and

defendant Lynch, individually——agreed that, within two days of

the execution of the Settlement Agreement, defendant Stone By

Lynch would cause to be filed a notice of satisfaction of its

claim    of    lien       and    a   notice      of   voluntary    dismissal     with

prejudice, and would execute and deliver a final lien waiver and

release,      as   well    as    a   Confession       of   Judgment.    In   return,

plaintiffs agreed that they would pay defendant Stone By Lynch

$60,000.00 in fixed increments subject to the following schedule

and milestones:           plaintiffs would pay the first $30,000.00 upon

the execution of the filings and deliverables requested in the

Settlement Agreement; plaintiffs would pay the next $20,000.00

upon the completion of defendant Stone By Lynch’s scope of work

for plaintiffs’ construction project; and plaintiffs would pay a

final payment of $10,000.00 “upon certification by [JAS-AM] and
                                             -4-
[plaintiffs] that [defendant Stone By Lynch] has satisfactorily

addressed punch list items.”                     The Settlement Agreement further

provided that the parties “have read and fully understood the

provisions      of     this     Agreement          prior     to     its    execution       and

delivery.”         This    Settlement            Agreement    was     signed       twice    by

defendant      Lynch    two     days    later      on    23 January        2012;    once    on

behalf of himself and once on behalf of defendant Stone By Lynch

as its managing member.                The Confession of Judgment, signed by

defendant Lynch on 23 January 2012 on behalf of defendant Stone

By Lynch, further provided that defendants authorized the entry

of a judgment, without action, in plaintiffs’ favor, in the

amount of $170,626.00, in the event that defendants “fail[ed] to

hold    harmless     [p]laintiffs           as   required     under       that   Settlement

Agreement entered by the [p]laintiffs, [d]efendants, and JAS-AM,

Inc., on or about January 23, 2012.”

       Following the execution of the Confession of Judgment, the

Settlement Agreement, and the final lien waiver and release on

23 January 2012 by defendant Lynch, and the execution of the

notices    of   satisfaction           of    claim      of   lien    and    of     voluntary

dismissal of cross-claims by defendant Stone By Lynch’s then-

counsel on 27 January 2012, plaintiffs paid defendant Stone By

Lynch    the    first     two    payments         owed     under    the    terms     of    the

Settlement Agreement.            Plaintiffs tendered payment for the final
                                               -5-
$10,000.00 owed under the Settlement Agreement on 27 June 2012.

Accompanying that check was a letter from plaintiffs’ counsel

indicating       that     acceptance       thereof         constituted       a   waiver    and

release of any claims by defendants against plaintiffs, and that

plaintiffs “reserve[d] any and all claims and causes of action”

against     defendants          “under         the        [Settlement       Agreement]      or

otherwise.”         Defendants returned this check to plaintiffs two

days later, purportedly because plaintiffs “allowed [a] deadline

to   pass     without        making       a        payment”        and     defendants     “now

consider[ed]            [plaintiffs]          in     breach         of     the   settlement

agreement.”         Two     weeks     later,         on    13 July       2012,   defendants’

counsel     sent    a     letter    to    counsel          for   plaintiffs      and    JAS-AM

indicating that his clients were “intent on removing the burden

of the confessions of judgment and settlement agreement which

you [sic] clients have placed them under”; “a burden which was

imposed upon them by forcing them to sign the documents without

being     given     the      opportunity           to      study     the     documents    for

themselves,        or    seek   the      counsel          of   their     attorney   who   was

representing them at the time.”

     One     month       later,    the    Mecklenburg            County     Superior     Court

entered     an     order     arising      from       Riverside’s         lien    enforcement

action against defendant Stone By Lynch, JAS-AM, and plaintiffs,

in which it recognized that plaintiffs and Riverside had reached
                                          -6-
a settlement with respect to the $255,626.00 cash bond posted by

plaintiffs in the Riverside action.                      The order        directed the

Clerk of Court to deliver a check for $70,000.00 made payable to

Riverside’s counsel, and to return the remaining balance plus

interest to plaintiffs, the proportional share of which would be

released   to      JAS-AM.         Although     the   terms        of   the     Settlement

Agreement provided that defendants would indemnify                              plaintiffs

and JAS-AM for all loss “arising from, relating to, or in any

manner connected with the [Riverside lien enforcement] Lawsuit,

the [plaintiffs’] Property, the Project funds, the [$255,626.00]

Cash Bond, or any combination thereof,”                       because         of both the

return   of     the    final      $10,000.00     check       and    counsel’s      letter

expressing that defendants no longer intended to be bound by the

“burdens      of      the   confessions         of    judgment          and     settlement

agreement,” on 31 October 2012, plaintiffs filed the Confession

of   Judgment      that     had    been   executed      by     defendant         Lynch   on

23 January 2012.

      While the Confession of Judgment had authorized entry of a

judgment against defendants and in favor of plaintiffs in the

amount of $170,626.00, after applying credits to the balance

due, on 1 November 2012, the Clerk of Court entered a judgment

ordering      defendants          to   pay    plaintiffs           $55,000.00.           On

21 December 2012, defendants filed a “Motion in the Cause To
                                     -7-
Vacate Judgment Pursuant to Rule 60(b) and Rule 68.1,” on the

grounds   that    defendants       “withdrew         their        consent      to    the

Confessions of Judgment via letter and draft of a complaint to

[plaintiffs] on July 13, 2012.”              On 17 September 2013, after

hearing the matter, the trial court denied defendants’ Rule 60

motion.   Defendants appealed.

                       _________________________

    Defendants      sole   contention      on   appeal       is    that     the     trial

court erred in denying defendants’ Rule 60 motion to vacate the

1 November   2012     judgment     entered      by    the      Clerk      of      Court.

Defendants   assert    that   they   “withdrew         their       consent     to    the

Confession of Judgment before it was filed by [plaintiffs]” on

31 October 2012, so that the clerk’s judgment entered upon the

Confession   of   Judgment    is   void    as   a    matter       of   law.         After

reviewing the record before us, we affirm the order of the trial

court.

    N.C.G.S. § 1A-1, Rule 68.1 provides that a confession of

judgment “may be entered without action at any time[,] . . . may

be for money due or for money that may become due,” N.C. Gen.

Stat. § 1A-1, Rule 68.1(a) (2013), and “remains as security for

the sums thereafter to become due.”                  N.C. Gen. Stat. § 1A-1,

Rule 68.1(e).     “The purpose of such confession is to provide an

expeditious method for entering judgment against one who does
                                       -8-
not dispute a debt, without the necessity of filing a lawsuit.”

2 G. Gray Wilson, North Carolina Civil Procedure § 68.1-1, at

68A-3 (3d ed. 2007).        “A confession of judgment is essentially a

consent judgment in that it depends on the agreement of the

parties which the court will enforce.”                 Id. at 68A-2 (citing

Yarborough v. Yarborough, 27 N.C. App. 100, 106, 218 S.E.2d 411,

415, cert. denied, 288 N.C. 734, 220 S.E.2d 353 (1975)); cf. id.

(“Judgment       by   confession    differs   from     an     ordinary      consent

judgment, however, to the extent that its form and manner of

entry and enforcement are supervised and regulated by statute,

in   this    instance      [N.C.G.S.    § 1A-1,]     Rule 68.1.”           (footnote

omitted) (citing Farmers Bank of Clayton v. McCullers, 201 N.C.

440, 443, 160 S.E. 494, 496 (1931))).                 “The judgment depends

upon the consent of the parties, and the court gives effect to

it as the agreement of the parties.                  It would not be valid

unless     the   parties   consented     . . . .”       Ballard       v.    Hunter,

12 N.C. App. 613, 618, 184 S.E.2d 423, 426–27 (1971) (internal

quotation marks omitted), cert. denied, 280 N.C. 180, 185 S.E.2d

704 (1972).

     Here, defendants assert that they “withdrew their consent

to   the    Confession      of     Judgment   before     it     was    filed     by

[plaintiffs].”        According to the record, defendant Lynch signed

the Settlement Agreement, the Confession of Judgment, and the
                                          -9-
final lien waiver and release on 23 January 2012, two days after

his meeting with plaintiff DeMayo and the president of JAS-AM,

and    defendant      Lynch’s      wife     notarized      his       signing   of    the

Confession of Judgment.              On 27 January 2012,              the notices     of

satisfaction of claim of lien                and of      voluntary dismissal of

cross-claims, as well as the final lien waiver and release were

executed and sent by defendant Stone By Lynch’s then-counsel to

plaintiffs and to the president of JAS-AM.                       Defendants concede

that    they    accepted      two    payments         totaling       $50,000.00     from

plaintiffs     in    accordance      with       the   terms     of    the   Settlement

Agreement, and that plaintiffs tendered payment for the third

and    final   payment       due    under    the      terms     of    the   Settlement

Agreement, which payment was refused by defendants.                            Although

defendants presented argument to the trial court that defendant

Lynch was incapable of understanding the documents at the time

he signed them because he was “medicated at the time he met with

DeMayo and Dhaliwal,” “suffers from dyslexia, causing him to

need assistance with reading comprehension,” and that plaintiff

DeMayo and Mr. Dhaliwal “refused to give Lynch a chance to read

the document which turned out to be a settlement agreement and

confession of judgment” and “demanded that Lynch sign it [sic]

on    the   spot,”    the   trial    court      rejected      these    assertions     as

“ridiculous,”        and    defendants      have      brought     forward      no   such
                                     -10-
challenges   on     appeal.      Instead,    in    their   brief,   defendants

assert only, and without support, that a letter stating that

they were “intent on removing the burden of the confessions of

judgment and settlement agreement”——under which they had already

accepted   two     of   three   settlement   payments——was     sufficient    to

revoke defendant Lynch’s consent to the terms of the Settlement

Agreement.    Defendants fail to direct this Court to any relevant

legal authority in support of their assertion, and “[i]t is not

the duty of this Court to supplement an appellant’s brief with

legal authority or arguments not contained therein.”                Goodson v.

P.H. Glatfelter Co., 171 N.C. App. 596, 606, 615 S.E.2d 350,

358,    supersedeas      and    disc.     review    denied,    360 N.C.     63,

623 S.E.2d 582 (2005); see also Viar v. N.C. Dep’t of Transp.,

359 N.C. 400, 402, 610 S.E.2d 360, 361 (per curiam) (“It is not

the role of the appellate courts . . . to create an appeal for

an   appellant.”),      reh’g   denied,    359 N.C.    643,   617 S.E.2d    662

(2005).    Thus, we reject defendants’ argument.

       Affirmed.

       Judges STEELMAN and DILLON concur.

       Report per Rule 30(e).