Adams Creek Assocs., Carolina Ltd. v. Davis

• Decision Date: 04 June 2013
• Docket Number: No. COA12–1200.,COA12–1200.
• Citation: 746 S.E.2d 1
• Parties: ADAMS CREEK ASSOCIATES, a North Carolina Limited Partnership with Billy Dean Brown, General Partner, Plaintiff, v. Melvin DAVIS and Licurtis Reels, Defendants.
• Court: North Carolina Court of Appeals

746 S.E.2d 1

ADAMS CREEK ASSOCIATES, a North Carolina Limited Partnership with Billy Dean Brown, General Partner, Plaintiff,

v.Melvin DAVIS and Licurtis Reels, Defendants.

No. COA12–1200.

Court of Appeals of North Carolina.

June 4, 2013.

Appeal by defendants from orders filed 16 September 2004, 9 February 2012, 29 May 2012, and 14 June 2012 by Judge Benjamin G. Alford in Carteret County Superior Court and from an order filed 31 March 2011 by Judge Jack W. Jenkins in Carteret County Superior Court. Heard in the Court of Appeals 12 February 2013.

Armstrong & Armstrong, P.A., Smithfield, by L. Lamar Armstrong, Jr.; and Ledolaw, by Michele A. Ledo, for plaintiff appellee.

Terry B. Richardson, Wilmington, for defendant appellants.

McCULLOUGH, Judge.

Defendants Melvin Davis (“Melvin”) and Licurtis Reels (“Licurtis”) appeal from the entry of an order granting plaintiff Adams Creek Associates (“Adams Creek”) partial summary judgment and from the entry of subsequent orders holding them in contempt of the partial summary judgment order, denying them relief from the partial summary judgment order, and imposing sanctions. For the following reasons, we affirm.

I. BACKGROUND

This case involves the disputed ownership of 13.25 acres of land along Adams Creek in Carteret County, North Carolina (the “Waterfront Property”). The Waterfront Property is included within, and was a part of, a 65–acre tract of land (the “Land”) that has been occupied by the defendants' family for a century.

The relevant history of the Land and this case is summarized as follows: Elijah Reels (“Elijah”) purchased the Land in November 1911. In January 1944, as a result of Elijah's nonpayment of taxes, the Land was conveyed to Carteret County. Elijah's son Mitchell Reels (“Mitchell”) then purchased the Land from Carteret County in February 1944. Mitchell died intestate in 1971. In June 1976, after qualifying to administer Mitchell's estate, Mitchell's daughter Gertrude Reels (“Gertrude”) filed a civil action in Carteret County Superior Court to affirm the property rights of Mitchell's heirs in the Land. In August 1976, the trial court entered a judgment ruling that Mitchell's heirs were the rightful owners of the Land (the “1976 Judgment”).

In January 1978, Mitchell's brother Shedrick Reels (“Shedrick”) petitioned to register title to 17.23 acres of the Land, which included the Waterfront Property, pursuant to the North Carolina Torrens Act, N.C. Gen.Stat. § 43–1 et seq. (the “Torrens Proceeding”). Shedrick's claim to ownership stemmed from a deed dated 20 September 1950 that was executed by Elijah and recorded in Carteret County. Mitchell's heirs were named as respondents in the Torrens Proceeding and filed an answer in March 1978. In January 1979, following a hearing, the Examiner of Titles filed his report concluding that “Shedrick ... is the owner of the [13.25 acres that is the Waterfront Property], having established title to the same by his Deed of September 20, 1950, and having adversely possessed the same for a period in excess of twenty-seven (27) years [.]” On 16 March 1979, Attorney C.R. Wheatly, III, filed a certification on behalf of the Mitchell's heirs certifying “that they have received a copy of the Report of the Examiner of Titles ... and that they have filed no exceptions thereto.” Thereafter, on 19 March 1979, the Superior Court of Carteret County filed a decree of registration and the Register of Deeds filed a certificate of registration, declaring Shedrick the owner of the Waterfront Property and certifying that the Waterfront Property was registered in Shedrick's name.

On 25 August 1982, Shedrick filed a trespass action against Melvin and Gertrude. In the complaint, Shedrick sought to remove the cloud on his title caused by Melvin's and Gertrude's claims to an interest in the Waterfront Property, to enjoin Melvin and Gertrude from further acts of trespass, and to recover damages. The trial court's order dated 4 November 1983 was filed on 4 January 1984, granting Shedrick summary judgment. The order explicitly adjudged Shedrick to be the owner of the Waterfront Property and ordered Melvin and Gertrude not to trespass.

Thereafter, on 20 September 1985, Melvin was found to have trespassed on the Waterfront property and was held in willful contempt of the 4 January 1984 order. Melvin, however, purged himself of contempt by signing a statement acknowledging that Shedrick was the owner of the Waterfront Property and pledging not to commit further acts of trespass.

On 27 November 1985, Shedrick and his wife Beatrice Reels executed a release of the Waterfront Property from the Torrens Act and conveyed the Waterfront Property to Monroe Johnson and Charles B. Bissette, Jr., d/b/a Adams Creek Development, by general warranty deed. The release and general warranty deed were recorded 12 December 1985. Monroe Johnson and Charles B. Bissette, Jr., d/b/a Adams Creek Development, then conveyed the Waterfront Property to Adams Creek on 8 September 1986.

The present action was initiated on 30 October 2002, by the filing of Adams Creek's complaint against Melvin and Licurtis (together “defendants”) in Carteret County Superior Court. The complaint alleged acts of trespass and sought to remove the cloud on Adams Creek's title caused by Licurtis' claim to an interest in the Waterfront Property by way of a deed executed by Gertrude and others on 20 January 1992. Adams Creek also sought punitive and compensatory damages. Answers disputing title to the Waterfront Property were filed on behalf of defendants on 16 December 2002 and 31 December 2002. On 14 May 2004, Adams Creek moved for partial summary judgment. Following a hearing, the Honorable Benjamin G. Alford (“Judge Alford”) entered an order on 16 September 2004, granting Adams Creek's motion for partial summary judgment (the “2004 Summary Judgment Order”). The order held that Adams Creek was the owner of the Waterfront Property and that Licurtis' deed to a portion of the Waterfront Property was a nullity. Furthermore, the order instructed defendants to “remove any structures, equipment, sheds, or trailers that they [had] placed upon the [Waterfront Property] ... and ... not enter upon or commit any act of trespass upon the [Waterfront Property] ....” The order left the issues of damages to be determined by a jury.¹

On 10 May 2006, Adams Creek filed a motion to show cause why defendants should not be held in contempt for failing to comply with the 2004 Summary Judgment Order. Thereafter, on 17 May 2006, defendants filed a response to Adams Creek's motion to show cause, a motion to disqualify C.R. Wheatly, III, as Adams Creek's counsel, and a motion to set aside the 19 March 1979 decree of registration.

The trial court granted Adams Creek's motion to show cause on 7 July 2006 and the matter came on for hearing on 7 August 2006. During the hearing, defendants acknowledged that they had gone onto the Waterfront Property since entry of the 2004 Summary Judgment Order and further testified that they would continue to enter upon the Waterfront Property regardless of any court order. As a result, an order was filed on 10 August 2006, holding defendants in contempt and ordering defendants to be held in custody for 21 days. Moreover, the trial court filed orders on 10 August 2006, denying defendants' motions to disqualify Adams Creek's counsel and set aside the decree of registration.

Defendants appealed all of the trial court's 10 August 2006 orders. Upon review, this Court affirmed the trial court's orders holding defendants in contempt, denying defendants' motion to disqualify Adams Creek's counsel, and denying defendants' motion to set aside the decree of registration. Adams Creek Assocs. v. Davis, 186 N.C.App. 512, 652 S.E.2d 677 (2007), appeal dismissed and disc. review denied,362 N.C. 354, 662 S.E.2d 900 (2008) (hereafter “Adams Creek I ”).

Notwithstanding the trial court's orders and this Court's affirmance of those orders, defendants continued to occupy the Waterfront Property. Consequently, on 28 January 2011, Adams Creek filed a motion to hold defendants in civil contempt. By order filed by the Honorable Jack W. Jenkins (“Judge Jenkins”) on 31 March 2011, the trial court found defendants in civil contempt of the 2004 Summary Judgment Order and ordered defendants imprisoned until their contempt is purged.²

On 21 December 2011, defendants contemporaneously filed motions to set aside the 2004 Summary Judgment Order and to purge their civil contempt. Defendants then moved for summary judgment in their favor by motion filed 11 January 2012. Adams Creek responded to defendants' motions on 18 January 2012 by filing a motion for sanctions pursuant to N.C. Gen.Stat. § 1A1, Rule 11 (2011). Thereafter, on 7 February 2012, Adams Creek filed a calendar request and notice of hearing for a jury trial on the issues of damages and a hearing on its motion for Rule 11 sanctions, both to take place the week of 21 May 2012.

Pursuant to an order filed 9 February 2012 by Judge Alford, defendants' motion to set aside the 2004 Summary Judgment Order was denied, defendants' motion for summary judgment was stricken, and defendants' motion to purge civil contempt was referred to Judge Jenkins for hearing, pending notice to be given by defendants. A ruling on Adams Creek's motion for Rule 11 sanctions was deferred pending a hearing. Defendants filed notice of appeal from Judge Alford's 9 February 2012 order on 6 March 2012.

On 16 May 2012, defendants filed a motion pursuant to Rule 54(b) of the North Carolina Rules of Civil Procedure to rescind the 2004 Summary Judgment Order and to rescind the 9 February 2012 order denying their motion to set aside the 2004 Summary Judgment Order. On the same day, defendants also filed a motion to dismiss the action on the basis that the statute of limitations had run against Adams Creek prior to the filing of the complaint on 30 October 2002. Defendants' motion to...