Court Opinion

ID: 9587207
Source: CourtListenerOpinion
Date Created: 2023-08-21 23:19:27.011711+00
Date Added: 2024-06-11T17:35:29.146576
License: Public Domain

Justice Huskins
dissenting.
It is perfectly apparent, to me at least, that Judge Ward found defendant “not guilty” and discharged him on the ground that G.S. 44-12 was unconstitutional. This conclusion is buttressed by the wording of the judgment itself which states: “The Court finds that the State offered evidence sufficient to convict the defendant upon the charges set out in the warrant. The Court, however, is of the opinion that Section 44.12 of the General Statutes of North Carolina is unconstitutional, and therefore void.” But for the judge’s notion that the statute was unconstitutional, Judge Ward would have found defendant guilty. G.S. 15-179(6) authorizes the State to appeal where judgment has been given for the defendant “upon declaring a statute unconstitutional.” I would therefore hold that the case was properly before Judge Hubbard on appeal by the State to the superior court and that Judge Hubbard’s judgment is properly before this Court for review since he also held the quoted portion of G.S. 44-12 unconstitutional.
The guilt or innocence of this defendant has not been decided on the merits in either the district court or the superior court. The majority opinion gives him the benefit of an acquittal to which he is not entitled.
In my view the penalty provisions in G.S. 44-12 are constitutional. The sums due the contractor, when paid to him by the owner, constitute a fund which is held in trust by the contractor for the materialmen and laborers to the extent of their claims and until their claims are paid. As to them, the contractor stands in the relationship of trustee; and when he converts the money to his own use without paying the persons performing labor or furnishing material, he commits a fraud for which he may be prosecuted. This view is supported in principle by Foundry Co. v. Aluminum Co., 172 N.C. 704, 90 S.E. 923 (1916); State v. Harris, 134 Minn. 35, 158 N.W. 829 (1916); and Overstreet v. Commonwealth, 193 Va. 104, 67 *469S.E. 2d 875 (1951). See Note, Mechanics’ Liens in North Carolina, 41 N.C. L. Rev. 173 (1963).
The penalty provisions of G.S. 44-12 do not provide for imprisonment for debt. The contractor is not being punished for his indebtedness to the laborers and materialmen. Rather, he is being punished for his fraud for (1) failing to furnish the owner an itemized statement of the sums due for labor and material before receiving any part of the contract price and (2) then receiving the contract price, failing to apply it to the payment of bills for labor and material, and converting it to his own use. It is the fraudulent conduct and not the indebtedness which is made the basis of guilt under this statute. Thus, the constitutional prohibition against imprisonment for debt has no application.
Rather than dismiss this appeal on the ground stated in the majority opinion and leave the penalty provisions of G.S. 44-12 constitutionally suspect, I would hold that the case is properly here on the State’s appeal and uphold the constitutionality of G.S. 44-12 in its entirety. I therefore respectfully dissent.
I am authorized to say that Justices Lake and Branch join in this dissent.