Court Opinion

ID: 8908620
Source: CourtListenerOpinion
Date Created: 2022-11-27 02:17:59.425371+00
Date Added: 2024-06-11T17:08:22.541808
License: Public Domain

WELLS, Judge.
Intervenor defendants present two questions for review: whether the court erred in denying their Rule 12(b)(6) motion to dismiss and their Rule 60(b) motion to vacate judgment. However, the linchpin of both arguments as presented by Sultana is the same: that plaintiffs filed this action before their right against Mustafa accrued. We shall therefore begin our discussion by addressing this issue.
*298When defendant Mustafa failed to appear at the trial on 31 May, the court ordered forfeiture of the appearance bond. Plaintiffs, who posted the $25,000 bond, had not yet been ordered to pay that amount to the court when they filed their complaint against Mustafa. Sultana contends that a surety’s right of action accrues when payment is actually made and that therefore plaintiffs’ action is premature. We disagree.
Very few cases on this issue have been decided in North Carolina in recent years. The leading case is Insurance Co. v. Gibbs, 260 N.C. 681, 133 S.E. 2d 669 (1963). The dispute in Gibbs centered on a portion of a contract in which plaintiff agreed to pay claims brought against defendant transport company by shippers or consignees. In the contract, Gibbs had expressly agreed to reimburse plaintiff for any such payments made. Plaintiff was therefore a surety on these obligations, and plaintiff sought to recover from the principal for payments made pursuant to those claims. Defendant contended that plaintiff stood in the shoes of the claimants it paid and that, since the statute of limitations had run barring any possible suit by the claimants, plaintiffs cause of action was similarly barred. The Gibbs court disagreed:
A surety who, pursuant to his contractual obligation, pays the debt of his principal has a right of action to recover the sum so paid. The principal is not obligated to his surety until his surety has made a payment. The surety’s right of action accrues at the time of payment, not before.
Id. The apparent rationale for such a rule is to prevent a surety from filing suit when it is still quite possible that the principal will himself pay the debt. Although the rule works well as a general principle and in particular with regard to statute of limitation questions, such cases as the one at bar must be distinguished. Here, the question is not whether the plaintiffs will be made to pay, but when: forfeiture has been ordered and there is evidence that defendant has returned to Kuwait in order to avoid jurisdiction of our courts. To adhere to the general rule set out in Gibbs would be to deny plaintiffs any recourse; only by filing this action and attaching defendant’s property have they prevented a questionable conveyance of the property until the matter could be adjudicated. Therefore, we hold that where forfeiture of an appearance bond is ordered, a surety’s cause of action accrues upon *299a showing that the principal has evaded process by leaving the jurisdiction. Intervenor defendants’ motions to dismiss and to vacate judgment were properly denied, and the decision of the trial court is
Affirmed.
Judges Martin and Parker concur.