Summary
In Jones, among other claims, the plaintiff brought a fraud claim against the defendant home mover where a contract existed between the parties.
Summary of this case from Bradley Woodcraft, Inc. v. BoddenOpinion
No. COA05-1183-2
Filed 16 December 2008
Appeal by plaintiff from judgment entered 10 May 2005 by Judge Jerry Braswell in Pamlico County Superior Court. This case was originally heard in the Court of Appeals 29 March 2006. Upon remand by order from the North Carolina Supreme Court, filed 7 March 2008.
William F. Ward, III, P.A., by William F. Ward, III, for plaintiff-appellant. Hopf Higley, P.A., by Donald S. Higley, II, for defendant-appellee Harrelson and Smith Contractors, LLC.
Pamlico County No. 03 CVS 206.
This litigation arose out of efforts to remove houses from the 100-year flood plain in Pamlico County following widespread destruction from Hurricane Floyd. A jury below found that defendant Harrelson and Smith Contractors, LLC ("HS"), who contracted with Pamlico County to remove such homes, committed fraud and conversion in its actions with respect to a house that HS sold to plaintiff Darvella Jones. The trial court (1) left the conversion verdict intact, (2) granted a directed verdict in favor of HS on Jones' unfair and deceptive trade practices ("UDTP") claim, and (3) granted judgment notwithstanding the verdict ("JNOV") to HS on the fraud claim. Finally, the trial court granted judgment in favor of HS with respect to Jones' claim for punitive damages. Jones appealed to this Court.
On 19 December 2006, a divided panel of this Court dismissed Jones' appeal for violations of the North Carolina Rules of Appellate Procedure. See Jones v. Harrelson Smith Contractors, LLC, 180 N.C. App. 478, 638 S.E.2d 222 (2006). On 7 March 2008, the North Carolina Supreme Court reversed that decision and remanded for reconsideration in light of the Court's decisions in Dogwood Dev. Mgmt. Co. v. White Oak Transp. Co., 362 N.C. 191, 657 S.E.2d 361 (2008), and State v. Hart, 361 N.C. 309, 644 S.E.2d 201 (2007). See Jones v. Harrelson Smith Contractors, LLC, 362 N.C. 226, 227, 657 S.E.2d 352, 353 (2008) (per curiam).
Upon reconsideration, we conclude that the appellate rules violations committed by Jones are nonjurisdictional violations for which dismissal of Jones' appeal is not appropriate. We further hold that these violations do not rise to the level of gross or substantial violations that warrant any other type of sanction.
On the merits, we reverse the trial court's entry of judgment in favor of HS on Jones' fraud and UDTP claims. We, therefore, remand for entry of judgment in the amount of $31,815.00 on the fraud claim, entry of an award of treble damages, and, in the trial court's discretion, an award of attorney's fees under N.C. Gen. Stat. § 75-16.1 (2007).
Facts and Procedural History
Hurricane Floyd struck North Carolina in September 1999, causing catastrophic flooding in the eastern portions of our State, including Pamlico County. Following the hurricane, Pamlico County, using funds provided by the state and federal governments, instituted a Flood Acquisition Program, which involved buying out landowners who had property located in the 100-year flood plain. One house purchased by the County belonged to Ray and Virginia Respers and was located at 439 Jones Road in the town of Vandemere. The County paid approximately $45,000.00 for the house, which was roughly equal to its appraised value.
The Flood Acquisition Program included a Demolition and Clearance Project designed to clear lots in the flood plain and thus reduce the possibility of property damage from future hurricanes and floods. As part of this project, the County solicited bids for the removal and/or demolition of homes that it had purchased in the flood plain. During the bidding process, HS submitted a demolition bid in the amount of $60,797.00. Based on this bid, the County awarded HS the demolition contract for a group of houses in the flood plain, including the Respers' former house.
The County signed a contract with HS, which included, among other provisions, an option allowing HS to salvage houses scheduled for demolition by severing them from their current lots and relocating them to lots outside the state-designated flood plain. HS decided to exercise that option and salvage several of the houses that the County had designated for removal, including (1) the Respers' former house, (2) another house that belonged to Herman Garrison, and (3) a third house that belonged to the O'Neil family.
Plaintiff Darvella Jones gave John Harrelson of HS $500.00 in cash for the Respers' former house. She showed Harrelson the piece of land nearby on Swan Point Road where she was currently living in a trailer and where she hoped to eventually place the house. Although it was apparent that the lot she showed Harrelson was inside the flood plain, Harrelson did not mention the contract restriction requiring that the house be relocated outside the flood plain. Instead, Harrelson asked Jones if she knew of anyone who moved houses. When Jones replied that she did not, Harrelson recommended his friend, defendant Rodney Turner.
HS succeeded in selling the O'Neil house to Clyde Potter and the Garrison house to Herbert Kent. Kent testified at trial that he paid HS $5,000.00 for his house and that HS never told him the house would need to be relocated outside the flood plain. Following their purchases, Potter, Kent, and Jones all employed defendant Turner to relocate their houses elsewhere inside the flood plain.
Prior to the move, HS had not entered into written contracts with any of the purchasers. On 10 September 2002, however, HS sent a letter to RSM Harris Associates, the consulting firm hired by the County to oversee the buy-out program, in which HS asserted: "We would like to assure you that the three owners that purchased the houses . . . were informed with a written contract that the houses were to be relocated above the 100-year floodplain and they were to accept all expense responsibility."
On 13 September 2002, after all three houses had been moved off their original lots and after sending the letter to RSM Harris Associates, HS mailed a short form to Potter, Kent, and Jones, requesting that each owner sign and return it. The form read as follows:
I, ______________, acknowledge all responsibility and expense for the moving and relocation for the house presently located at ________________ in ___________ County. I understand the house becomes my property and responsibility as of _______________. I understand the house has to be relocated outside the 100 year flood plain.
Jones' form had the blanks completed with the information relating to her house. She signed it because HS said it needed the form for its records.
On or about 20 September 2002, the County's inspectors learned that the Potter, Kent, and Jones houses had been relocated from their original lots to other lots inside the flood plain. According to a County official, the North Carolina Division of Emergency Management gave the County three possible ways to resolve the issues with the three houses: (1) the houses could be removed to a location outside the flood plain, (2) the houses could be demolished, or (3) the houses could be removed from the buy-out program by reimbursement of the County for the full amount it had paid to the original owners. The County, in turn, informed HS that the house relocations violated the terms of the Demolition and Clearance contract, explained the three choices, and gave HS a deadline of 10 December 2002 to "complete corrective action." The County later threatened legal action against HS if it did not bring the salvaged houses into compliance with the contract.
It is unclear from the record when RSM Harris Associates learned that the houses were not in compliance with the County contract. HS' managing member, Kenneth Smith, acknowledged in an affidavit admitted into evidence that HS "had been notified" by an unnamed entity that Jones' house was still in the flood plain at some time between the moving of the house on 19 August 2002 and the sending of the 13 September 2002 form.
HS ultimately dealt with each house in a different manner. With respect to Potter's house, HS paid more than $22,000.00 to cover the cost of relocating the house to another lot that Potter owned outside the flood plain and putting it on a foundation. Kent, however, refused to move his house a second time, so HS was forced to reimburse the County in the amount of $52,757.00 — the amount paid by the County to the original owner of the house in the buy-out program.
As for Jones' house, Harrelson met with Jones to inform her of the problem. He told her that he had found a lot outside the flood plain on Water Street in the town of Bayboro and offered to relocate her house there at HS' expense. He told her that the owner of the lot was willing to sell the lot to Jones for $12,000.00, but that HS would make the first two months' payments for her. Jones told Harrelson she did not want to live on WaterStreet. Instead, she contacted a realtor and began to make arrangements to purchase a lot in the town of Reelsboro with the intent of moving the house there. On 5 December 2002, she provided HS with written certification that the Reelsboro lot was outside the flood plain.
The next day, 6 December 2002, four days before the County's deadline, HS hired defendant Turner to move Jones' house from her Swan Point lot to the Water Street lot that HS had rented at its own expense. Harrelson acknowledged at trial that Jones had never given him permission to move the house, but said that HS was under pressure to bring the three houses into compliance by 10 December 2002. Jones was driving to work when she discovered that her house was missing.
On 9 December 2002, HS sent a letter to the County, requesting payment on its contract with the County and stating: "Please consider this request and its urgency because [HS] has incurred considerable expense in trying to resolve these issues." The County, however, was not satisfied because "the house was still in a potential movable position, still had steel underneath of it, and . . . could still easily be moved back into the flood zone."
On 13 January 2003, HS' attorney sent a letter to Jones' attorney, requesting "that your client make satisfactory arrangements for governmental approval of the location of this house by securing approval at its current location, by moving it to an appropriate location, or otherwise, putting the controversy to rest before January 29, 2003." The letter also stated that"[a]bsent governmental approval, [HS] must have the house removed by February 6, 2003. The time period between January 29, 2003 and February 6, 2003 will be used to raze the house if your client fails to make arrangements as set forth above." On 4 February 2003, when Jones had not responded, HS demolished the house where it sat on the Water Street lot.
Jones filed suit on 10 November 2003 against HS and Turner, asserting claims for fraud, negligent misrepresentation, conversion, and unfair and deceptive trade practices. HS filed an answer on 20 January 2004. When Turner made no appearance, Jones obtained an entry of default against him on 2 March 2004.
Both Jones and HS unsuccessfully moved for summary judgment, and the case was set for trial in February 2005. Upon motion of HS, the compensatory and punitive damages stages of the trial were bifurcated pursuant to N.C. Gen. Stat. § 1D-30 (2007). At the conclusion of Jones' evidence in the liability phase of the trial, HS moved for a directed verdict on all issues. The trial court denied HS' motion, and the case proceeded with HS' evidence. At the close of all the evidence, the trial court denied HS' renewed motion for a directed verdict. At that time, Jones voluntarily dismissed her negligent misrepresentation claim, leaving for decision her claims for fraud, conversion, and UDTP. During the charge conference, however, the trial judge stated that he was revisiting his decision on HS' motion for a directed verdict and had decided to grant that motion with respect to Jones' UDTP claim. Jones' claims for fraud and conversion were submitted to the jury. The verdict sheet returned by the jury read:
We, the jury, by unanimous verdict, find as to the Issues as follows:
ISSUE ONE: Was the Plaintiff damaged by the fraud of the Defendant? Answer: Yes
ISSUE TWO: What amount of damages is the Plaintiff entitled to recover? Answer: $31,815
ISSUE THREE: Did the Defendant convert the house relocated at Swan Point Road by the Plaintiff? Answer: Yes
ISSUE FOUR: Did the Plaintiff abandon the home? Answer: No
ISSUE FIVE: What amount is the Plaintiff entitled to recover for the damages for the conversion of the property of the Plaintiff? Answer: $30,000
The morning after the verdict, HS moved (1) for JNOV as to both claims, (2) for "judgment as a matter of law on the issue of punitive damages," or, in the alternative, (3) for a new trial on all issues. The trial court orally granted HS' motion for JNOV as to the fraud claim, but denied it as to the conversion claim. The court also entered judgment for HS as to Jones' claim for punitive damages. Lastly, the court denied HS' motion for a new trial. Jones then also unsuccessfully moved for a new trial.
On 18 March 2005, Jones filed a motion pursuant to N.C.R. Civ. P. 52, requesting that the trial court make specific findings of fact and conclusions of law with respect to its rulings. The court denied Jones' motion and, instead, on 10 May 2005, entered a short judgment specifying the jury's verdict, setting forth the court's rulings on the parties' various motions, and entering judgment in favor of Jones in the amount of $30,000.00. Jones filed a notice of appeal on 1 June 2005.
Appellate Rules Violations
In Dogwood Dev. Mgmt. Co., our Supreme Court set out the framework for deciding whether to sanction a party for appellate rules violations. The Supreme Court explained that appellate rules violations fall into three types of "defaults": "(1) waiver occurring in the trial court; (2) defects in appellate jurisdiction; and (3) violation of nonjurisdictional requirements." Id. at 194, 657 S.E.2d at 363. If the error is a nonjurisdictional default, the appellate court "possesses discretion in fashioning a remedy to encourage better compliance with the rules." Id. at 198, 657 S.E.2d at 365.
Significantly, "a party's failure to comply with nonjurisdictional rule requirements normally should not lead to dismissal of the appeal." Id. Instead, a court may consider other sanctions for such violations. Nevertheless, the Dogwood Court cautioned that "the appellate court may not consider sanctions of any sort when a party's noncompliance with nonjurisdictional requirements of the rules does not rise to the level of a `substantial failure' or `gross violation.'" Id. at 199, 657 S.E.2d at 366. The Court directed that "[i]n such instances, the appellate court should simply perform its core function of reviewing the merits of the appeal to the extent possible." Id.
This Court originally dismissed Jones' appeal for two violations of the appellate rules. First, it held that Jones' assignments of error violated Rule 10(c)(1) by failing to state the legal basis for Jones' contention that the trial court erred in making its rulings with regard to the claims for fraud, UDTP, punitive damages, and prejudgment interest. Jones, 180 N.C. App. at 487, 638 S.E.2d at 229. Second, the Court held that Jones further violated Rule 10(c)(1) by failing to include, after each assignment of error, citations to the record. Id. at 487-88, 638 S.E.2d at 229. Under Dogwood, neither of these bases for the initial dismissal are jurisdictional, and they do not warrant dismissal of the appeal. The question remains whether any further action by this Court is warranted.
Turning first to the issue of citations to the record, Rule 10(c)(1) provides that "[a]n assignment of error is sufficient if it directs the attention of the appellate court to the particular error about which the question is made, with clear and specific record or transcript references." We note that Jones did not completely disregard this requirement of Rule 10(c)(1). She included appropriate references to the transcript for each of the trial court's rulings challenged on appeal, but either omitted a reference to the record or included an incorrect citation to the record. Jones' citations to the transcript constitute substantial compliance with Rule 10(c)(1), while her typographical errors in the record citations do not constitute a substantial error or gross violation warranting any sanction.
With respect to the substance of the assignments of error, Jones assigned error to the trial court's (1) granting defendant's motion for a directed verdict on the UDTP claim, (2) granting defendant's motion for JNOV as to the fraud claim and award of compensatory damages, (3) allowing defendant's motion to dismiss plaintiff's claim for punitive damages for conversion, (4) refusal to find conversion to be a UDTP "as a matter of law," and (5) refusal to award interest from the date of conversion of Jones' house. As an initial matter, we hold that the conversion/UDTP assignment of error, although not as precise as it could be, adequately states a legal basis when it asserts that conversion in this case constituted a UDTP "as a matter of law."
The remaining assignments of error, however, simply recite that the trial court erred without explaining why. Rule 10(c)(1) provides that "[e]ach assignment of error shall, so far as practicable, be confined to a single issue of law; and shall state plainly, concisely and without argumentation the legal basis upon which error is assigned."
As for the assignments of error relating to the trial court's rulings granting a directed verdict on the UDTP claim, JNOV on the fraud claim, and judgment as a matter of law on punitive damages, we note that the only legal ground that could be relied upon by Jones is that sufficient evidence existed for those claims to go to the jury. See Alberti v. Manufactured Homes, Inc., 94 N.C. App. 754, 758, 381 S.E.2d 478, 480 (1989) ("Motions for directed verdict or judgment notwithstanding the verdict are properly granted only if the evidence is insufficient to support a verdict for the nonmovant as a matter of law."), aff'd in part, reversed in part, and vacated in part on other grounds, 329 N.C. 727, 407 S.E.2d 819 (1991). As a result, the omission of the legal basis from these assignments of error — that the evidence was sufficient to go to the jury — does not impair our ability to review the merits of the appeal and could not have prejudiced HS.
In deciding whether these assignments of error substantially violate Rule 10(c)(1), we are guided by the decisions of the Supreme Court in considering assignments of error asserting that a trial court erred in granting summary judgment. In Ellis v. Williams, 319 N.C. 413, 355 S.E.2d 479 (1987), the Supreme Court reversed the Court of Appeals when it dismissed an appeal because the appellant had failed to include in the record on appeal any assignments of error at all as to a summary judgment order. The Supreme Court held:
The purpose of summary judgment is to eliminate formal trial when the only questions involved are questions of law. Thus, although the enumeration of findings of fact and conclusions of law is technically unnecessary and generally inadvisable in summary judgment cases, summary judgment, by definition, is always based on two underlying questions of law: (1) whether there is a genuine issue of material fact and (2) whether the moving party is entitled to judgment. On appeal, review of summary judgment is necessarily limited to whether the trial court's conclusions as to these questions of law were correct ones. It would appear, then, that notice of appeal adequately apprises the opposing party and the appellate court of the limited issues to be reviewed. Exceptions and assignments of error add nothing.
This result does not run afoul of the expressed purpose of Rule 10(a). Exceptions and assignments of error are required in most instances because they aid in sifting through the trial court record and fixing the potential scope of appellate review. We note that the appellate court must carefully examine the entire record in reviewing a grant of summary judgment. Because this is so, no preliminary "sifting" of the type contemplated by the rule need be performed. Also, as previously observed, the potential scope of review is already fixed; it is limited to the two questions of law automatically raised by summary judgment. Under these circumstances, exceptions and assignments of error serve no useful purpose. Were we to hold otherwise, plaintiffs would be required to submit assignments of error which merely restate the obvious; for example, "The trial court erred in concluding that no genuine issue of material fact existed and that defendants were entitled to summary judgment in their favor." At best, this is a superfluous formality.
Id. at 415-16, 355 S.E.2d at 481 (internal citations omitted). The Supreme Court reversed the Court of Appeals and remanded for this Court to review the case on its merits. Id. at 417, 355 S.E.2d at 482.
Our Supreme Court recently reaffirmed Ellis:
This Court has long held, and the law has not been changed, that for purposes of an appeal from a trial court's entry of summary judgment for the prevailing party, the appealing party is not required under Rule 10(a) of the Rules of Appellate Procedure to make assignments of error for the reason that on appeal, review is necessarily limited to whether the trial court's conclusions as to whether there is a genuine issue of material fact and whether the moving party is entitled to judgment, both questions of law, were correct.
Schenkel Shultz, Inc. v. Hermon F. Fox Assocs., 362 N.C. 269, 276-77, 658 S.E.2d 918, 923 (2008) (emphasis added).
To deny consideration of Jones' assignments of error regarding the fraud, UDTP, and punitive damages claims because of her failure to state the only possible basis for review would amount to requiring, in the language of Ellis, that Jones engage in a "superfluous formality." Ellis, 319 N.C. at 416, 355 S.E.2d at 481. We, therefore, hold that Jones' challenges to the trial court's rulings on her fraud, UDTP, and punitive damages claims are properly before this Court for appellate review.
We reach a different conclusion with respect to Jones' prejudgment interest assignment of error. The legal basis for that claim of error is neither set out in the assignment of error nor apparent from the nature of the error challenged. We do not believe that consideration of this error is necessary "[t]o prevent manifest injustice to a party, or to expedite decision in the public interest." N.C.R. App. P. 2. Accordingly, we decline to exercise our discretion under Rule 2 to review this assignment of error.
In sum, in accordance with the Supreme Court's mandate, we have reconsidered this panel's prior dismissal of the appeal in light of Dogwood and Hart. We hold that no sanction is warranted and that this Court should review Jones' appeal on the merits with the exception of the prejudgment interest assignment of error.
HS filed a motion to dismiss the appeal as interlocutory since the default judgment against Rodney Turner, the house mover, was not entered until after Jones appealed to this Court. In this Court's initial opinion, the majority denied the motion because although the appeal was indeed interlocutory at the time it was filed, judgment had since been entered against Turner, leaving nothing to be resolved at the trial level. See Tarrant v. Freeway Foods of Greensboro, Inc., 163 N.C. App. 504, 508, 593 S.E.2d 808, 811 (declining to dismiss appeal as interlocutory when plaintiff took voluntary dismissal of remaining claims pending in the trial court after giving notice of appeal but before case was heard in the Court of Appeals), disc. review denied, 358 N.C. 739, 603 S.E.2d 126 (2004). We see no reason to revisit that conclusion.
The Merits of the Appeal
A. Grant of JNOV on Fraud Claim
Jones' first argument is that the trial court erred in granting HS' motion for JNOV on the fraud claim. A motion for JNOV is a renewal of an earlier motion for a directed verdict, and the standards of review are the same. Bryant v. Nationwide Mut. Fire Ins. Co., 313 N.C. 362, 368-69, 329 S.E.2d 333, 337 (1985). "In considering any motion for directed verdict, the trial court must view all the evidence that supports the non-movant's claim as being true and that evidence must be considered in the light most favorable to the non-movant, giving to the non-movant the benefit of every reasonable inference that may legitimately be drawn from the evidence with contradictions, conflicts, and inconsistencies being resolved in the non-movant's favor." Id. at 369, 329 S.E.2d at 337-38.
"The essential elements of actionable fraud are: `(1) [f]alse representation or concealment of a material fact, (2) reasonably calculated to deceive, (3) made with intent to deceive, (4) which does in fact deceive, (5) resulting in damage to the injured party.'" Becker v. Graber Builders, Inc., 149 N.C. App. 787, 793, 561 S.E.2d 905, 910 (2002) (quoting Ragsdale v. Kennedy, 286 N.C. 130, 138, 209 S.E.2d 494, 500 (1974)). In this case, the parties have centered their arguments around the third element of fraud, the intent to deceive. The required scienter for fraud is not present without both knowledge and an intent to deceive, manipulate, or defraud. Myers Chapman, Inc. v. Thomas G. Evans, Inc., 323 N.C. 559, 568, 374 S.E.2d 385, 391 (1988).
Here, when the evidence is viewed in the light most favorable to Jones, with all inferences drawn in her favor, both knowledge and intentional deception can be attributed to HS. There is no dispute that HS had knowledge of the requirement that the houses be relocated outside the flood plain. Further, Jones showed Harrelson where she planned to move the house, which would permit a jury to infer that HS knew she intended to move the house within the flood plain. Jones offered evidence that, despite this knowledge, Harrelson said nothing about the requirement that the house be moved outside of the flood plain, but rather helped her find a house mover to move the house to the new location.
Jones' evidence also suggested that once HS learned that the County was aware that the salvaged houses had not been moved outside the flood plain, HS falsely told the County's agent that it had written contracts requiring the new owners to comply with the flood plain requirement. HS then, according to Jones' evidence, created after-the-fact "contracts" designed to cover-up HS' failure to disclose the flood plain requirement and failure to have a written contract. Finally, there was evidence in the record that HS fabricated documents pertaining to other elements of its contract with the County and similarly misled two other purchasers of houses — evidence from which the jury could conclude that HS had an overall scheme of deceit with respect to the County contract in order to maximize its profit. We hold that a jury could infer an intent to deceive from this evidence.
Apart from challenging the sufficiency of the evidence to prove an intent to deceive, HS argues on appeal that the form signed by Jones, stating that it was her responsibility to move the house outside the flood plain, amended the parties' contract. According to HS, Jones was, therefore, limited to suing for breach of contract. HS, however, cites no authority supporting its assumption that a plaintiff cannot sue for fraud if she has a breach of contract claim. The law is, in fact, to the contrary: a plaintiff may assert both claims, although she may be required to elect between her remedies prior to obtaining a verdict. See First Atl. Mgmt. Corp. v. Dunlea Realty Co., 131 N.C. App. 242, 256-57, 507 S.E.2d 56, 65 (1998) (discussing principle that a person who was fraudulently induced to purchase property may elect between contract or tort remedy).
Moreover, Jones contends that the form represented an attempt by HS to cover up its fraud in the sales of the houses and, therefore, is evidence of HS' intent to deceive. Our courts have acknowledged that evidence insufficient to establish a breach of contract may nonetheless be admissible to prove that a contract was fraudulently induced or that the defendant committed unfair and deceptive trade practices. See McNamara v. Wilmington Mall Realty Corp., 121 N.C. App. 400, 413, 466 S.E.2d 324, 333 (holding that evidence of the parties' negotiations was inadmissible on the breach of contract claim, but was admissible to prove fraud and unfair and deceptive trade practices), disc. review denied, 343 N.C. 307, 471 S.E.2d 72-73 (1996). It was for the jury to decide what inferences should be drawn from the form and what weight to give it. Accordingly, we reverse the trial judge's entry of JNOV with respect to the jury's fraud verdict.
B. Damages for Fraud and Conversion
The parties dispute the amount of damages that Jones is entitled to recover in the event of reinstatement of the fraud verdict. Jones argues that she is entitled to recover both the damages awarded for conversion and the damages awarded for fraud, for a total amount of $61,815.00. HS contends, however, that recovery of both verdicts would amount to a double recovery. We agree with HS that Jones is not entitled to both awards, but rather must elect between them.
Jones' fraud claim arose out of H S' failure to inform Jones that she would need to move the house outside the flood plain, while her conversion claim arose out of HS' removal and eventual destruction of her house. HS' fraudulent actions were separate and apart from its acts of conversion and required separate damages instructions. As to Jones' damages from the fraud, the trial court instructed the jury: "The plaintiff's actual damages are equal to the fair market value of the property . . . at the time that the plaintiff was defrauded." It then instructed the jury to award damages for conversion based on the "fair market value of the property at the time it was converted."
The parties have not challenged these instructions on appeal, and therefore we express no opinion regarding whether they were a correct articulation of the measure of damages for each claim.
It is apparent from these instructions that the jury's awards of $31,815.00 for fraud and $30,000.00 for conversion — each involving the fair market value of the same property at a different point in time — represent overlapping damages. Jones is not entitled to recover the fair market value of the house twice. The doctrine of the election of remedies prevents "`double redress for a single wrong.'" United Labs., Inc. v. Kuykendall, 335 N.C. 183, 191, 437 S.E.2d 374, 379 (1993) (quoting Smith v. Gulf Oil Corp., 239 N.C. 360, 368, 79 S.E.2d 880, 885 (1954)). "[T]he underlying basis" of this rule is "the maxim which forbids that one shall be twice vexed for one and the same cause." Smith, 239 N.C. at 368, 79 S.E.2d at 885. Accordingly, we hold that Jones is entitled to judgment in the amount of $31,815.00, the greater of the two overlapping amounts awarded by the jury.
C. Unfair and Deceptive Trade Practices
Jones next assigns error to the trial court's entry of a directed verdict on Jones' UDTP claim. The basis of that ruling is not entirely clear since the trial judge stated that he was dismissing only Jones' independently pled UDTP claim, but would still allow Jones to argue, during the punitive damages stage of the bifurcated trial, that UDTP principles should apply in the calculation of damages, if the jury found liability on the basis of either fraud or conversion.
The court's ruling appears to reflect a misunderstanding of the nature of a claim brought under N.C. Gen. Stat. § 75-1.1 (2007). A UDTP claim is a substantive claim, the remedy for which is treble damages. N.C. Gen. Stat. § 75-16 (2007). Chapter 75 is not a remedial scheme for other substantive claims. See Bhatti v. Buckland, 328 N.C. 240, 245, 400 S.E.2d 440, 443 (1991) (noting that N.C. Gen. Stat. § 75-1.1 "was enacted to establish an effective private cause of action for aggrieved consumers in this State" (internal quotation marks omitted)). As this Court has stated, "[p]laintiffs can assert both UDTP violations under N.C. Gen. Stat. § 75-1.1 and fraud based on the same conduct or transaction. Successful plaintiffs may receive punitive damages or be awarded treble damages, but may not have both." Compton v. Kirby, 157 N.C. App. 1, 21, 577 S.E.2d 905, 918 (2003). The approach followed by the trial court in this case of dismissing the UDTP claim, but allowing counsel to argue it in connection with punitive damages, was in error.
With respect to the trial court's dismissal of Jones' substantive UDTP claim, we need not address Jones' argument that the conversion verdict was sufficient to meet the requirements of that claim because it is well-settled that "a plaintiff who proves fraud thereby establishes that unfair or deceptive acts have occurred." Bhatti, 328 N.C. at 243, 400 S.E.2d at 442. See also Hardy v. Toler, 288 N.C. 303, 309, 218 S.E.2d 342, 346 (1975)("Proof of fraud would necessarily constitute a violation of the prohibition against unfair and deceptive acts. . . ."); State Props., LLC v. Ray, 155 N.C. App. 65, 74, 574 S.E.2d 180, 187 (2002) ("[A] finding of fraud constitutes a violation of N.C. Gen. Stat. § 75-1.1."), disc. review denied, 356 N.C. 694, 577 S.E.2d 889 (2003). "Once the plaintiff has proven fraud, thereby establishing prima facie a violation of Chapter 75, the burden shifts to the defendant to prove that he is exempt from the provisions of N.C.G.S. § 75-1.1." Bhatti, 328 N.C. at 243-44, 400 S.E.2d at 442 (internal citation omitted).
Because the jury found in favor of Jones on the fraud claim and because HS has made no attempt to argue that it is exempt from the provisions of N.C. Gen. Stat. § 75-1.1, Jones is entitled, under Bhatti, to recover treble damages under N.C. Gen. Stat. § 75-16. We, therefore, remand for entry of judgment in favor of Jones on her UDTP claim and for trebling of her fraud damages. Upon remand, the trial court must also consider whether to exercise its discretion to award attorney's fees under N.C. Gen. Stat. § 75-16.1. Bhatti, 328 N.C. at 247, 400 S.E.2d at 444.
D. Punitive Damages
Jones also challenges the trial court's decision, rendered between the two phases of the bifurcated trial, to grant HS' "motion for judgment as a matter of law" as to her claim for punitive damages. In Lindsey v. Boddie-Noell Enters., Inc., 147N.C. App. 166, 177, 555 S.E.2d 369, 377 (2001), disc. review denied in part, 355 N.C. 213, 559 S.E.2d 803, rev'd in part on other grounds, 355 N.C. 487, 562 S.E.2d 420 (2002) (per curiam), this Court stated that "where an appellate court concludes that a case that was bifurcated at trial pursuant to N.C. Gen. Stat. § 1D-30 must be remanded for a new trial on the issues relating to punitive damages, we believe the statute requires that the case must also be remanded for a new trial on the issues of liability for compensatory damages and the amount of compensatory damages, so that the same jury may try all of these issues."
"Judgment as a matter of law" is a phrase used in the federal court system. See Fed.R.Civ.P. 50(a). Counsel did not, in his oral motion, cite a rule under the North Carolina Rules of Civil Procedure pursuant to which his motion was made. We presume the motion was, in essence, one for a directed verdict.
In other words, under the bifurcated procedure set forth in § 1D-30, this Court cannot direct a trial court, on remand, to conduct only the punitive damages phase of the bifurcated trial. Rather, any remand requires that the trial court start over at the beginning with the liability phase before proceeding to the punitive damages phase.
We need not address Jones' argument that the motion for "judgment as a matter of law" as to punitive damages was inappropriately timed. But see Gibbs v. Mayo, 162 N.C. App. 549, 558-59, 591 S.E.2d 905, 911-12 (holding that trial court did not err in dismissing plaintiff's punitive damages claim ex mero motu at the close of plaintiff's evidence during the liability phase when "[t]he only new evidence plaintiffs may have presented in the punitive damages stage was the amount of punitive damages they sought"), disc. review denied, 358 N.C. 543, 599 S.E.2d 45 (2004). Confronted with the prospect of foregoing her favorable jury verdicts and retrying her substantive claims, Jones has stated on appeal that she elects to receive treble damages pursuant to her UDTP claim rather than punitive damages. See Compton, 157 N.C. App. at 21, 577 S.E.2d at 918 ("Successful plaintiffs may receive punitive damages or be awarded treble damages [under Chapter 75], but may not have both."). Jones has, therefore, rendered the punitive damages issue moot.
Conclusion
In summary, we conclude that, under the test set forth by the Supreme Court in Dogwood, any appellate rules violations committed by Jones are insufficient to warrant dismissal of the appeal or the imposition of any other sanctions beyond refusal to review the prejudgment interest assignment of error. As to the merits of this appeal, the trial court's grant of HS' JNOV motion is reversed, and the jury verdict finding HS liable for fraud in the amount of $31,815.00 is reinstated. The trial court's entry of judgment as to Jones' UDTP claim is reversed, and this case is remanded for entry of judgment in the amount of $95,445.00 and for the court to consider, in its discretion, whether to award attorney's fees under N.C. Gen. Stat. § 75-16.1.
We note that HS, in its brief, requested that this Court remand this case for a new trial. HS did not, however, cross-assign error to the trial court's denial of its motion for a new trial. Further, HS has not cited any authority at all supporting the grant of a new trial to HS. Without the citation of any authority, we decline to grant HS a new trial.
Affirmed in part, reversed in part, and remanded.
Judge JACKSON concurs.
Judge TYSON concurs in the result in part and dissents in part in a separate opinion.