Court Opinion

ID: 9572742
Source: CourtListenerOpinion
Date Created: 2023-08-21 20:44:12.053618+00
Date Added: 2024-06-11T12:34:00.193495
License: Public Domain

Justice HUSKINS
dissenting.
I respectfully dissent from that part of the majority opinion which affirms the decision of the Court of Appeals upholding denial of the defense motion for dismissal pursuant to Rule 12(b) (6) or the defense motion for summary judgment pursuant to Rule 56. Summary judgment was appropriate upon defendants’ defense that the parties had entered into a full and final settlement of the claim. The reimbursement order of Judge Kivett was error, but it was error favorable to plaintiff.
*98It is also my view that the dismissal of plaintiff’s action for failure to comply with the reimbursement order was not appealed in time to the Court of Appeals and accordingly the late appeal should have been dismissed in the Court of Appeals.
Plaintiff sued for personal injuries suffered in a collision between her car and the car driven by the male defendant and owned by the female defendant. By their answer, defendants assert that plaintiff is barred from prosecuting this case because she entered into a settlement agreement with defendants’ insurance carrier and has been paid $3,394.50 in full settlement of her claim. Defendants therefore moved for dismissal on the pleadings or for summary judgment.
At the hearing on the motions, Shirley Bennett, a claims representative for insurer, testified that she and plaintiff agreed to settle plaintiff’s claim for $3,000 over the medical bills. In accordance with that agreement, Bennett testified she mailed a draft and final release to plaintiff on 23 June 1977. Both plaintiff and defendants agreed that the check was originally intended as a full and final payment of all claims. On cross-examination, plaintiff testified: “I agreed to a compromise settlement of my claim for $3,000 plus the outstanding medicals. What Mrs. Bennett said was true about the conversation. After that conversation and the argument settled, Mrs. Bennett sent me a letter that confirmed very briefly our conversation and enclosed the draft and release.” Plaintiff further testified she “first refused to settle for $2,000 because I was concerned of other problems. ... I negotiated from $2,000 up to $3,000.”
Plaintiff admitted she received the check for $3,073.50 and a transmittal letter with a release entitled “FULL AND FINAL Release OF All Claims.” Medical expenses amounting to $321 were paid directly to the treating physician. The record shows that the check was endorsed by plaintiff, deposited in her checking account and cleared on 30 June 1977. Plaintiff further admitted that, although she accepted the check and used its proceeds, she failed to sign and return the release.
According to Mrs. Bennett’s testimony, on 26 July 1977 plaintiff telephoned her and informed her that plaintiff had incurred further medical bills and had been in the hospital for surgery by reason of the accident. Bennett testified she told plaintiff that if *99she was not satisfied with the settlement “to send everything back.” Instead of returning everything as directed, plaintiff returned the release unsigned on 15 August 1977 enclosing therewith her additional medical bills and by telephone informed Shirley Bennett that she had deposited the draft in her bank account.
Plaintiff testified she called Shirley Bennett around the first week in July to tell her there would be additional medical expenses and that Bennett told her to go ahead and cash the draft and send the release back with the additional bills, which she did. Plaintiff s husband testified he also spoke to Bennett and that she told him to keep the draft and send the release back unsigned.
Shirley Bennett denied she ever told plaintiff or her husband to keep the draft and return the release unsigned. She testified that plaintiff understood the payment of $3,000 plus medicals was in full and complete settlement of her claim; otherwise, the release would not have been entitled “FULL AND FINAL RELEASE of All Claims.”
On 4 April 1979, Judge Kivett denied motions of defendants to dismiss and for summary judgment but ordered plaintiff to reimburse defendants’ insurer the sum of $3,073.50 paid to her plus $320 paid to her doctor. Plaintiff did not appeal from this order and did not make the reimbursement as ordered. On 3 May 1979, defendants moved that plaintiff’s action be dismissed with prejudice for failure to comply with the reimbursement order of Judge Kivett. Responding to that motion, plaintiff filed an affidavit that she did not have and had been unable to borrow sufficient funds to comply with the order. The motion was heard by Judge Collier on 7 June 1979, and he entered an order dismissing plaintiff’s action unless, within ten days, she complied with Judge Kivett’s reimbursement order. Plaintiff did not comply and her action was subsequently dismissed.
She appealed to the Court of Appeals and. that court reversed with Clark, J., dissenting. The Court of Appeals held that Judge Kivett’s reimbursement order was “invalid” and also denied cross-assignments by defendants that the trial court erred in denying the motions to dismiss and for summary judgment. The majority said a genuine issue of material fact does exist and the trier of fact “must determine whether the payment to plaintiff constituted a full settlement of her claim or was an advance *100or partial payment. There are also the issues of fact relating to negligence which are raised by plaintiffs complaint. Denial of the motion to dismiss was proper, as the complaint does state a claim upon which relief can be granted.” 47 N.C. App. at 134, 266 S.E. 2d at 741. In view of Judge Clark’s dissent, defendants appealed to this Court as of right.
It is my view that the Court of Appeals erred in vacating Judge Collier’s order of 7 June 1979 dismissing plaintiffs action for failure to comply with Judge Kivett’s order of 2 April 1979 and in remanding defendants’ Rule 41(b) motion for a new ruling. This ruling is erroneous because plaintiff did not appeal within the time allowed by law from Judge Kivett’s reimbursement order which affected “a substantial right” of plaintiff. See G.S. l-277(a); G.S. 7A-27(d). Plaintiff’s notice of appeal from that order was not filed until 18 June 1979, long after the ten days allowed by G.S. l-279(c) had expired. Of course, as the majority here indicates, Judge Collier could not overrule Judge Kivett. The reimbursement order thus became final. The appeal should be dismissed.
The principal grounds for my dissent, however, are not procedural. Rather, it is my view that the Court of Appeals erred in upholding Judge Kivett’s denial of defendants’ Rule 12(b)(6) motion to dismiss or, in the alternative, defendants’ Rule 56 motion for summary judgment based on the compromise settlement agreement between the parties. Judge Kivett erred in ordering plaintiff to return the money paid to her by defendants’ insurer in order to allow her to proceed with her action. This was error favorable to plaintiff. It gave her a chance to proceed in an action she had already settled.
It is quite obvious that plaintiff negotiated a complete settlement of her claim and received a settlement draft in the amount agreed upon. She is bound by her admission to that effect. Thereafter, but before depositing the draft in her checking account, she noticed a lump in her chest which, according to her testimony, was an injury which she had not contemplated at the time she negotiated the settlement. Nevertheless, she proceeded to deposit the settlement checks and accept the benefits of the settlement. She is now estopped to take a contrary position. She cannot have her cake and eat it too. The factual dispute about *101whether the insurance agent told plaintiff to keep the money sometime in July 1977 after the check was cashed is of no consequence to the resolution of the suit. Plaintiff admits a full settlement had already been agreed upon and entered into before that dispute arose.
The check was not an advance or a partial payment, and G.S. 1-540.8 has no application here. The check for $3,073.50 was mailed to plaintiff by the insurance carrier for defendants with a “full and final settlement” release attached. No rational mind could have thought they were intended as an “advance or partial payment” on plaintiff’s claim. The majority opinion from which I dissent permits plaintiff, by her unilateral action alone, to convert the check and closing papers intended to consummate a final settlement into an “advance or partial payment” controlled by G.S. 1-540.3. This permits fraud, encourages perjury and subverts the law as I understand it. For the reasons stated, I maintain that G.S. 1-540.3 has no application to this case. The admissions of plaintiff speak far louder than a signed form release.
If plaintiff became dissatisfied with the final settlement to which she had agreed, then it was her duty “to send everything back,” decline to consummate the settlement previously agreed upon, and carry her case to the jury — all of which she had a perfect right to do. This right terminated the day she cashed the check which she admits was intended as a final settlement of the claim.
The majority holding in this case will put an end to settlements by mail. Hereafter, no defendant and no liability insurance carrier will ever part with a check or draft in settlement of a claim unless a properly signed final release is simultaneously or first delivered in exchange for it. Out-of-court settlement and compromise should be encouraged as opposed to perjury and fraud in court.
I vote to dismiss the appeal or, in the alternative, to reverse and remand for entry of summary judgment for defendants.
Justices Copeland and Britt join in this dissent.