Albert v. Cowart
| Decision Date | 15 September 2009 |
| Docket Number | No. COA09-93.,COA09-93. |
| Citation | 682 S.E.2d 773 |
| Court | North Carolina Court of Appeals |
| Parties | Sherry S. ALBERT, Administratrix of the Estate of Doris Hill King; Sherry S. Albert, Administratrix of the Estate of Frank Larue King, Plaintiffs, v. J. Kimzie COWART, Wachovia Corporation, Regions Bank, Am South Investment Services, Inc., and New York Life Insurance and Annuity Corporation, Defendants. |
Prince, Youngblood & Massagee, PLLC, by Boyd B. Massagee, Jr., Hendersonville, for plaintiff-appellee.
Dameron, Burgin, Parker & Jackson, P.A., by Phillip T. Jackson, Marion, for defendant-appellant J. Kimzie Cowart.
William L. Gardo, II, Hendersonville, for defendant-appellant J. Kimzie Cowart.
K & L Gates LLP, by A. Lee Hogewood III, Raleigh, for defendant-appellant Wachovia Corporation.
Womble Carlyle Sandridge & Rice, by Tricia Morvan Derr, Charlotte, for defendant-appellee Regions Bank and AM South Investment Services, Inc.
Nelson Mullins Riley & Scarborough, LLC, by Thomas G. Hooper, Charlotte, for defendant-appellee New York Life Ins. and Annuity Corporation.
Defendants Kimzie Cowart and Wachovia Corporation (Wachovia) appeal from Henderson County Superior Court judgments entered 31 July 2008 and 2 September 2008. For the reasons stated herein, we reverse in part the judgment of the trial court and dismiss in part the appeal.
Frank and Doris King were residents of Henderson County, North Carolina. At the age of 75, Doris was diagnosed with terminal cancer, and her doctor encouraged her to get her affairs in order. On 7 September 2005, Cowart, Frank King's nephew, received Doris's authorization for a durable power of attorney. On that same day, Cowart presented Wachovia with the document granting him durable power of attorney and authorizing him to conduct banking transactions on her behalf.
As long-time customers of Wachovia, the Kings had multiple accounts: on 8 September 2005, certificate of deposit number 51192050455143 (CD 143) had a balance of $100,110.44; on 9 September 2005, certificate of deposit number 514112040471176 (CD 176) had a balance of $54,950.45; on 9 September 2005, certificate of deposit number 514112050810824 (CD 824) had a balance of $197,486.42; and on 9 September 2005, certificate of deposit number 514112050810832 (CD 832) had a balance of $99,050.69. The Kings also maintained a joint checking account, number 1038892435650. Both Frank and Doris had individual Customer Access Agreements (CAA) on file with Wachovia authorizing that a right of survivorship be incorporated with any joint account opened with Wachovia. Each account was held jointly under the names of Frank and Doris King.
On 8 September 2005, Cowart presented Wachovia with the following statement signed by himself and Doris King: "Please open a checking account in the names of Doris H. King and Kimzie Cowart in the amount of $100,000." On 9 September 2005, pursuant to the written request, Wachovia opened a joint checking account under the names Doris H. King and J. Kimzie Cowart—Account 588.
On 8 and 9 September 2005, as attorney-in-fact, Cowart liquidated the certificates of deposit held jointly by Frank and Doris King, withdrew $9,000 from their joint checking account, and deposited a total of $460,598.00 into Account 588. Doris King died 11 September 2005. Frank King died over a year later on 8 November 2006. Frank's daughter and Doris's stepdaughter, Sherry Albert, was appointed administratrix of their respective estates (plaintiffs).
On 11 September 2005, a check for $5,519.80 was issued from Account 588. On 15 September 2005, a check was issued for $450,000.00, made payable to AmSouth1 from Account 588. On 12 October 2005, with a check issued by AmSouth, Cowart purchased a single premium deferred fixed annuity from New York Life Insurance and Annuity Corporation (New York Life) for $400,000.00. Cowart is the owner and annuitant listed. On 12 October 2005, Wachovia Account 588 held a balance of $5,105.03.
On 28 September 2006, plaintiffs filed suit against Cowart and Wachovia. On 5 September 2007, plaintiffs amended the complaint to add Regions Bank, AmSouth Investment Services, Inc. (AmSouth), and New York Life as additional defendants. In the complaint, plaintiffs alleged that Wachovia breached its fiduciary duty, acted negligently, and breached its debtor/creditor relationship; that Cowart breached his fiduciary duty, received unjust enrichment, and engaged in constructive fraud and conversion; and that Regions Bank, AmSouth, and New York Life were entitled to the imposition of a constructive trust on moneys transferred to them originating from Wachovia bank Account 588. Cowart filed an answer to the complaint and additionally, filed a cross-claim against Wachovia on the basis of derivative liability—if Cowart was liable to plaintiffs, he requested that Wachovia be taxed with the cost.
On 20 June 2008, Cowart filed a motion for partial summary judgment requesting that the trial court find that Account 588 was a joint account with right of survivorship and that all claims by plaintiff against Cowart be dismissed.
As to Cowart, plaintiffs filed a motion for partial summary judgment requesting the following determinations:
1. that Wachovia bank [Account 588] was funded with monies belonging to Doris Hill King ("Doris"), and was not funded with any monies of Defendant Cowart;
2. that no name other than that of Doris and Defendant Cowart was purported to be on Account 588;
3. that Account 588 was not an account with right of survivorship;
4. that Doris died on September 11, 2005, and an amount in excess of $450,000.00 was then in Account 588;
5. that $450,000.00 was withdrawn from Account 588 by Defendant Cowart after September 11, 2005;
6. that upon the death of Doris, her estate was entitled to all monies in Account 588, including the $50,000.00 withdrawn by Defendant Cowart; and
7. that Plaintiffs are entitled to a judgment against Defendant Cowart in the amount of $450,000.00, with interest from September 16, 2005 until paid as a matter of law.
(Original emphasis).
On 31 July 2008, following a hearing on 7 July 2008, the trial court entered a judgment allowing Cowart's motion as to plaintiffs' claims of constructive fraud and conversion but denied his motion on plaintiffs' claims of breach of fiduciary duty and unjust enrichment. The trial court also denied Cowart's motion to determine that Account 588 included a right of survivorship and allowed plaintiffs' motion to determine that Account 588 was not a survivorship account. The judgment was deemed final as to those claims and matters and pursuant to Rule 54(b) certified for immediate appeal. From this order, both Cowart and Wachovia appeal.
On 25 July 2008, Wachovia filed a motion for summary judgment requesting that the trial court find that Account 588 was a joint account with right of survivorship and enter an order dismissing both plaintiffs' amended complaint and Cowart's cross-claim against Wachovia.
On 2 September 2008, following a hearing on 4 August 2008, the trial court entered an order granting summary judgment in favor of Wachovia on Cowart's cross-claim of negligence but, as with Cowart's motion, denied Wachovia's motion to determine that Account 588 was a survivorship account. The trial court also denied plaintiffs' motion on the issue of whether Wachovia acted in bad faith. This judgment was deemed final as to those claims and pursuant to Rule 54(b) certified for immediate appeal. From these orders, both Cowart and Wachovia appeal.
On appeal, Cowart and Wachovia individually question whether (I & III) the trial court erred in determining Account 588 to be a joint account without a right of survivorship. Wachovia separately contends that (II) plaintiffs' initial complaint alleging that Account 588 is a survivorship account precluded summary judgment; and Cowart contends that (IV) summary judgment of Cowart's cross-claim of negligence against Wachovia is precluded by the existence of a genuine issue of material fact.
Before considering the arguments presented, we address plaintiffs' motion to dismiss both appeals as interlocutory.
Immediate appeal of interlocutory orders and judgments is available when a trial court enters a final judgment and certifies that there is no just reason for delay of the appeal as to one or more—but fewer than all—claims or parties and when an interlocutory order or judgment affects a substantial right. See Sharpe v. Worland, 351 N.C. 159, 161-62, 522 S.E.2d 577, 579 (1999) (citation omitted); see also N.C. Gen.Stat. § 1A-1, Rule 54(b) (2007) ( ). "Although not binding on this Court, we afford a trial court's Rule 54(b) certification great deference on appeal." Kinesis Adver., Inc. v. Hill, 187 N.C.App. 1, 9, 652 S.E.2d 284, 291 (2007) (citation omitted).
Here, Cowart and Wachovia appeal from judgments entered 31 July 2008 and 2 September 2008. In the judgment entered 31 July 2008, the trial court denied Cowart's motion as to plaintiffs' claims of breach of fiduciary duty and unjust enrichment. However, the trial court allowed plaintiffs' motion to determine Account 588 did not have a right of survivorship. Pursuant to Rule 54(b), the trial court certified the judgment as final, stating, "[t]here is no just reason to delay the appeal of this Judgment."
On 2 September 2008, the trial court entered a summary judgment order in favor of Wachovia on Cowart's cross-claim...
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... ... In Albert v. Cowart, __ N.C. App. __, 682 S.E.2d 773 (2009), we reviewed a trial court's Rule 54(b) determination that "no just reason for delay" of an ... ...