Court Opinion

ID: 4160861
Source: CourtListenerOpinion
Date Created: 2017-04-18 12:08:30.117052+00
Date Added: 2024-06-11T14:38:14.326132
License: Public Domain

IN THE COURT OF APPEALS OF NORTH CAROLINA

                                 No. COA16-549

                               Filed: 18 April 2017

Durham County, No. 15 CVS 2332

LEE K. TERRY AND KRISTEN TERRY, INDIVIDUALLY AND AS PARENTS AND
GENERAL GUARDIANS FOR KARRYNE TERRY, A MINOR, Plaintiffs,

            v.

THE CHEESECAKE FACTORY RESTAURANTS, INC., Defendant.

      Appeal by plaintiffs from order entered 2 March 2016 by Judge Henry W.

Hight, Jr. in Superior Court, Durham County. Heard in the Court of Appeals 3

November 2016.

      Law Offices of Thomas F. Loflin III, by Thomas F. Loflin III, for plaintiff-
      appellants.

      Hedrick Gardner Kincheloe & Garofalo, LLP, by M. Duane Jones and Kristie
      Hedrick Farwell, for defendant-appellee.

      STROUD, Judge.

      Plaintiffs appeal an order transferring venue of their negligence claim from

Durham County to Wake County. Because the pleadings and discovery show that

defendant maintains a place of business in Durham County, Durham County was a

proper venue under North Carolina General Statute § 1-83, and the trial court erred

by transferring venue as a matter of right. Therefore, we reverse and remand.

                                   I.    Background
                  TERRY V. THE CHEESECAKE FACTORY RESTS., INC.

                                  Opinion of the Court

      In March of 2015, plaintiffs filed a complaint in Superior Court, Durham

County seeking damages for negligent injury to their minor daughter. The complaint

alleged that the plaintiffs “are citizens and residents of North Carolina” but did not

mention their county of residence. The complaint alleged that defendant was

incorporated in California but is “engaged in commerce within the state of North

Carolina under a Certificate of Authority from the Department of the Secretary of

State of North Carolina” and “does business with the general public in Durham

County, North Carolina, as well as other counties” in North Carolina.

      Plaintiffs alleged they ordered “a one-half regular cheesecake and a one-half

ultimate red velvet cheesecake” for their daughter’s birthday from defendant’s

restaurant at Crabtree Valley Mall; plaintiff Kristen Terry specifically informed

defendant her daughter had a “severe allergy to nuts.” Plaintiffs further alleged that

the type of cheesecake plaintiff Kristen ordered did not contain nuts, but defendant’s

employee mistakenly gave plaintiff Kristen “a one-half low carb cheesecake instead

of a one-half regular cheesecake[;]” and though the two cheesecakes looked the same,

the low carb cheesecake contained nuts. Plaintiffs alleged their daughter became

violently ill due to her exposure to nuts and required hospitalization after eating

cheesecake from defendant, The Cheesecake Factory Restaurants, Inc. (“Cheesecake

Factory”).

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                     TERRY V. THE CHEESECAKE FACTORY RESTS., INC.

                                       Opinion of the Court

       In April of 2015, defendant filed a motion to dismiss pursuant to Rule 12(b)(3)

alleging that Durham County was not a proper venue and thus the complaint should

be dismissed or, in the alternative, the case should be transferred to Wake County.

Defendant’s motion alleged that the plaintiffs’ “last known address” was in Cary,

North Carolina, and that defendant’s registered office is in Wake County, North

Carolina.1    On 2 March 2016, after a hearing on the matter, the trial court denied

the motion to dismiss and allowed the request to transfer the case to Wake County.

Plaintiffs appeal.

                                              II.    Venue

       Plaintiffs’ only argument on appeal is that “the trial court committed reversible

error in granting the defendant’s motion to change venue to Wake County pursuant

to N.C.R.Civ.P 12(b)(3).” (Original in all caps.) Though plaintiffs appeal from an

interlocutory order, because the trial court found plaintiffs filed their complaint in an

improper venue, this affects a substantial right which we will consider. See Snow v.

Yates, 99 N.C. App. 317, 319, 392 S.E.2d 767, 768 (1990) (“When a defendant asserts

improper venue in a timely writing, the question of removal is a matter of substantial

right, and the court of original venue must consider and determine the motion before

it takes any other action. An appeal of an order disposing of such a motion is

interlocutory because it does not dispose of the case. However, grant or denial of a

       1 Defendants argue that plaintiffs’ residence is in Wake County, although our record does not
say. Plaintiffs’ brief acknowledges, “it is true that Plaintiffs reside in Wake County[.]”

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                 TERRY V. THE CHEESECAKE FACTORY RESTS., INC.

                                 Opinion of the Court

motion asserting a statutory right to venue affects a substantial right and is

immediately appealable.” (citations and quotation marks omitted)).

                    According to N.C. Gen. Stat. § 1–82, a civil action
            must be tried in the county in which the plaintiffs or the
            defendants, or any of them, reside at its commencement.
            As a practical matter, the plaintiff generally gets to make
            an initial choice as to the venue in which a particular civil
            action should be litigated. However, a number of statutory
            provisions authorize efforts to seek a change of venue.
            First, according to N.C. Gen. Stat. § 1–83:
                    If the county designated is not the proper one,
                    the action may, however, be tried therein,
                    unless the defendant, before the time of
                    answering expires, demands in writing that
                    the trial be conducted in the proper county,
                    and the place of trial is thereupon changed by
                    consent of parties, or by order of the court.
                    The court may change the place of trial in the
                    following cases:
                    (1)     When the county designated for that
                            purpose is not the proper one.
                    (2)     When the convenience of witnesses and
                            the ends of justice would be promoted
                            by the change.
                    (3)     When the judge has, at any time, been
                            interested as party or counsel.
            N.C. Gen. Stat. § 1–83. A motion challenging an improper
            venue or division should be asserted pursuant to N.C. Gen.
            Stat. § 1A–1, Rule 12(b)(3) and must be advanced within
            the time limits specified in N.C. Gen. Stat. § 1A–1, Rule 12.
            It is well settled that a court’s decision upon a motion for a
            change of venue pursuant to G.S. 1–83(2) will not be
            disturbed absent a showing of a manifest abuse of
            discretion. However, when the venue where the action was
            filed is not the proper one, and N.C. Gen. Stat. § 1–83(1) is
            applicable, the trial court does not have discretion, but
            must upon a timely motion and upon appropriate findings
            transfer the case to the proper venue.

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                  TERRY V. THE CHEESECAKE FACTORY RESTS., INC.

                                  Opinion of the Court

Carolina Forest Ass'n, Inc. v. White, 198 N.C. App. 1, 9–10, 678 S.E.2d 725, 731–32

(2009) (citations, quotation marks, ellipses, and brackets omitted).

      Defendant’s motion to dismiss for improper venue was based only upon North

Carolina Rule of Civil Procedure 12(b)(3) and sought dismissal or transfer to Wake

County solely based upon the residence of the parties. North Carolina General

Statute § 1-83 states four bases for a change of venue, two of which are plainly not

applicable here as there are no allegations the judge has “been interested as a party

or counsel” nor is the action “for divorce[.]” N.C. Gen. Stat. § 1-83(3-4) (2015).

Defendant did not allege or argue any grounds for a discretionary change of venue

such as “[w]hen the convenience of witnesses and the ends of justice would be

promoted by the change.” N.C. Gen. Stat. § 1-83(2) (2015); Carolina Forest Ass’n, 198
N.C. App. at 10; 678 S.E.2d at 732. So although the trial court’s order did not state a

particular reason for the change of venue, the only ground in the motion before the

trial court was that none of the parties were residents of Durham County; this is most

appropriately characterized as an argument based on North Carolina General

Statute § 1-83(1) because defendant was essentially contending “the county

designated . . . is not the proper one” due to no party being a resident as is required

pursuant to North Carolina General Statute § 1-82. N.C. Gen. Stat. §§ 1-82; 1-83(1)

(2015); Carolina Forest Ass’n, 198 N.C. App. at 10; 678 S.E.2d at 732.              “A

determination of venue under N.C. Gen. Stat. § 1–83(1) is . . . a question of law that

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                     TERRY V. THE CHEESECAKE FACTORY RESTS., INC.

                                     Opinion of the Court

we review de novo.” Stern v. Cinoman, 221 N.C. App. 231, 232, 728 S.E.2d 373, 374

(2012).

          Plaintiffs’ initial brief argued that defendant is a foreign corporation because

it was formed in California, and thus plaintiffs based their argument on North

Carolina General Statute § 1-80, entitled “foreign corporations[,]” and case law

regarding foreign corporations. See generally N.C. Gen. Stat. § 1-80 (2015).          But

since defendant maintains a registered office in North Carolina and has a certificate

of authority from the Secretary of State, defendant is actually a domestic corporation.

See N.C. Gen. Stat. § 1-79(b) (2015) (“[T]he term ‘domestic’ when applied to an entity

means: (1) An entity formed under the laws of this State, or (2) An entity that (i) is

formed under the laws of any jurisdiction other than this State, and (ii) maintains a

registered office in this State pursuant to a certificate of authority from the Secretary

of State.”)

       Defendant argues that “‘[w]hen reviewing a decision on a motion to transfer

venue, the reviewing court must look to the allegations of the plaintiff’s complaint.’

Ford v. Paddock, 196 N.C. App. 133, 135, 674 S.E.2d 689, 691 (2009).” Defendant’s

brief at least implies that we may look no further than the complaint, which is

incorrect since both this Court and the trial court may consider other verified parts

of the record. See Construction Co. v. McDaniel, 40 N.C. App. 605, 608, 253 S.E.2d
359, 361 (1979) (“We find that the rule which has been long followed in this

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                   TERRY V. THE CHEESECAKE FACTORY RESTS., INC.

                                    Opinion of the Court

jurisdiction still prevails and that the trial court in ruling upon a motion for change

of venue is entirely free to either believe or disbelieve affidavits such as those filed by

the defendants without regard to whether they have been controverted by evidence

introduced by the opposing party.”); see also Kiker v. Winfield, 234 N.C. App. 363,

365, 759 S.E.2d 372, 373-74 (2014) (considering plaintiff’s verified answers to

defendant’s interrogatories in determining proper venue), aff’d per curiam, 368 N.C.
33, 769 S.E.2d 837 (2015). But since most of defendant’s arguments are based upon

the complaint, we first turn there.

       Defendant argues that the complaint does not identify plaintiffs’ county of

residence, which is true, although defendant asks us to assume that plaintiffs reside

in Wake County and plaintiffs’ brief admits as much. Defendant also argues that

“the Complaint specifically states an actual place of business in Wake County, the

restaurant where the alleged tort occurred – Defendant’s restaurant at Crabtree

Valley Mall.” But the complaint actually mentions only the restaurant in Crabtree

Valley Mall; it does not identify the county of the restaurant or Crabtree Valley Mall.

Defendant’s brief seems to assume that the court is aware of the location of Crabtree

Valley Mall, and indeed we are.

       In fact, we will take judicial notice that Crabtree Valley Mall is in Wake County

and further that the Cheesecake Factory was operating in Crabtree Valley Mall as of

the date of commencement of the action. See N.C. Gen. Stat. § 8C–1, Rule 201 (2015)

                                           -7-
                     TERRY V. THE CHEESECAKE FACTORY RESTS., INC.

                                        Opinion of the Court

(“(b) Kinds of facts. — A judicially noticed fact must be one not subject to reasonable

dispute in that it is either (1) generally known within the territorial jurisdiction of

the trial court or (2) capable of accurate and ready determination by resort to sources

whose accuracy cannot reasonably be questioned. (c) When discretionary. — A court

may take judicial notice, whether requested or not.”). What defendant’s brief fails to

mention is the fact that there is also a Cheesecake Factory restaurant in Durham

County, but we need not take judicial notice of that particular location, since

defendant responded to plaintiffs’ request for admissions and admitted that “[t]he

Cheesecake Factory Restaurants, Inc. conducts business activities in Durham

County, North Carolina at 8030 Renaissance Parkway, Suite 950, and has done so

since March 1, 2012.”2 Thus, the answers to the request for admissions establish that

defendant was conducting business activities in Durham County at a specific address.

       Plaintiffs contend in their reply brief that even if defendant is a domestic

corporation, venue is proper in Durham County pursuant to North Carolina General

Statute § 1-79 which provides that a domestic corporation is deemed to reside and

thus may be sued: “(1) Where the registered or principal office of the corporation,

limited partnership, limited liability company, or registered limited liability

partnership is located, or (2) Where the corporation, limited partnership, limited

liability company, or registered limited liability partnership maintains a place of

       2We will take judicial notice that this is the street address of the Streets at Southpoint. See
N.C. Gen. Stat. § 8C–1, Rule 201.

                                                -8-
                   TERRY V. THE CHEESECAKE FACTORY RESTS., INC.

                                    Opinion of the Court

business[.]”   N.C. Gen. Stat. § 1-79(b). Plaintiffs argue that because defendant

“maintains a place of business” in Durham County, it is a proper venue. Id. It is

clear from defendant’s answers to the request for admissions that defendant

“conducts business activities in Durham County” and that defendant “owns some

equipment, fixtures and furnishings located in Durham County[;]” thus, defendant

“[m]aintain[s] a place of business” in Durham County. Id. As defendant maintains

a place of business in Durham County, Durham County was a proper venue for

plaintiffs’ lawsuit, see id., and thus the trial court erred in changing venue as a matter

of right. See id.; see also N.C. Gen. Stat. § 1-83(1).

                                       III.     Conclusion

      For the foregoing reasons, we reverse and remand.

      REVERSED AND REMANDED.

      Judges McCULLOUGH and ZACHARY concur.

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