Capps v. NW Sign Industries of North Carolina, Inc., No. COA06-1297 (N.C. App. 8/21/2007)
| Decision Date | 21 August 2007 |
| Docket Number | No. COA06-1297,COA06-1297 |
| Parties | ALAN CAPPS, Plaintiff, v. NW SIGN INDUSTRIES OF NORTH CAROLINA, INC., a North Carolina Corporation, RONALD BRODIE, and CHRIS REEDEL, Defendants. |
| Court | North Carolina Court of Appeals |
James, McElroy & Diehl, P.A., by Richard B. Fennell and Jared E. Gardner, for the plaintiff-appellee.
Vandeventer Black LLP, by David P. Ferrell and Norman W. Shearin, Jr., for the defendants-appellants.
NW Sign Industries of North Carolina, Inc. ("NW Sign of N.C."), Ronald Brodie ("Brodie") and Chris Reedel ("Reedel") (collectively, "defendants") appeal from an order filed 20 February 2006. For the following reasons, we affirm the trial court's order.
The facts of this case, stated in greater detail in this Court's earlier opinion, see Capps v. NW Sign Indus. of N.C., Inc., 171 N.C. App. 409, 411.12, 614 S.E.2d 552, 554.55 (2005), vacated, 360 N.C. 391, 627 S.E.2d 614 (2006) (per curiam), show that Brodie is President and CEO of NW Sign Industries, Inc. ("NW Sign of N.J."), a New Jersey Corporation that is not a party to this suit, and that Reedel is Vice President of NW Sign of N.J. and General Manager of NW Sign of N.C. Alan Capps ("plaintiff") was employed as a salesperson by NW Sign of N.J. from December 2000 until November 2002. Plaintiff began working for NW Sign of N.J. in December 2000, and in January 2001, he worked for NW Sign of N.C. and was added to the NW Sign of N.C. payroll. According to plaintiff, NW Sign of N.C. terminated his employment in November 2002 in order to avoid paying him his commission due.
On 20 June 2003, plaintiff brought suit against defendants, alleging a violation of the North Carolina Wage and Hour Act, wrongful discharge, and breach of contract. Plaintiff later added a claim for punitive damages. On 19 November 2003, defendants filed: (1) an answer; (2) counterclaims for breach of contract and violation of a covenant not to compete; (3) a motion for judgment on the pleadings; and (4) a motion to dismiss pursuant to Rules 12(b)(1) and 12(b)(6) of the Rules of Civil Procedure, based upon the existence of a forum-selection and arbitration clause in plaintiff's employment contract. By order entered 18 February 2004, the trial court denied defendants' motion for judgment on the pleadings and motion to dismiss.
On 24 February 2004, the trial court ordered the parties to engage in a mediated settlement conference , and on 16 June 2004, defendants filed notice of appeal from the trial court's 18 February 2004 order. Thereafter, on 24 August 2004, the trialcourt filed a consent order staying the trial court proceedings pending a decision by this Court.
On 5 July 2005, this Court dismissed defendants' appeal on the grounds that the trial court's order was interlocutory and did not affect a substantial right. See Capps, 171 N.C. App. at 411, 614 S.E.2d at 554. Dissenting in Capps, Judge Wynn stated that although "a denial of a motion to dismiss is an interlocutory order and thus not ordinarily appealable . . ., if the issue pertains to the application of a forum-selection clause, our courts have held that a defendant may nevertheless immediately appeal the order because the order affects a substantial right." Id. at 412, 614 S.E.2d at 555 (Wynn, J., dissenting) ().
After this Court issued its opinion, plaintiff pressed to obtain outstanding discovery, prompting defendants to file a motion to stay dated 26 August 2005 in the trial court. On 15 September 2005, defendants also filed a petition for writ of supersedeas and a motion for temporary stay with the Supreme Court. On 16 September 2005, the Supreme Court denied defendants' petition and motion , and defendants withdrew their motion for stay filed in the trial court. Trial court proceedings resumed that day, with the trial court's ordering the parties to complete mediation no later than 7 February 2006. On 26 January 2006, the parties participated in a mediated settlement conference. The parties, however, offer differing accounts of the events during and after the mediation. Defendants allege that the mediator expressed to them that the "teeth" of the confidentiality agreement — i.e., that the settlement payments would be made over a period of time and would be contingent upon plaintiff's keeping the settlement confidential _ would be negotiated in a settlement agreement that would follow the mediation. At the close of the mediation, the parties signed a Memorandum of Agreement ("the memorandum"), a five-sentence memorandum of key terms , but defendants, in signing this memorandum and given their previous conversation with the mediator, contend that they did not believe the memorandum to be the complete and final settlement agreement between the parties. The mediator asked the parties to draft a settlement agreement , which defendant expected would be negotiated and would include a confidentiality clause "with teeth." Defendants' attorney drafted a detailed settlement agreement and e-mailed the draft to plaintiff's attorney. Plaintiff's attorney suggested revisions, deleted some of defendants' attorney's proposed provisions, and added additional paragraphs , and the attorneys continued corresponding via e-mail through the afternoon of 7 February 2006.
In contrast, plaintiff contends that the parties completely settled the case at the 26 January 2006 mediation. The memorandum included the statement that "[t]he parties agree that the terms of this Settlement are confidential," and all parties signed this document. Plaintiff argues that the defendants' attorney's proposed settlement agreement that was emailed to plaintiff's attorney contained multiple, material terms that were not agreed to or contemplated during mediation, and plaintiff's attorney rejected the new terms the same morning he received the email . On 8 February 2006, plaintiff filed a motion to enforce the mediated settlement agreement as written and notified defendant that a hearing on the motion would be held within twenty-four hours. Following the hearing, the trial court entered an order on 20 February 2006 allowing plaintiff's motion to enforce the mediated settlement agreement. Thereafter, defendants filed a motion to amend the judgment , which the trial court denied on 14 March 2006.
On 7 April 2006, our Supreme Court issued a per curiam opinion vacating this Court's opinion in Capps filed on 5 July 2005:
For the reasons stated in the dissent, the decision of the Court of Appeals is vacated, and the case is remanded with direction to the Court of Appeals to further remand to the Superior Court of Mecklenburg County for findings of fact sufficient for appellate review of the jurisdictional issue.
Capps, 360 N.C. at 392, 627 S.E.2d at 614. Subsequently, the trial court complied with the Supreme Court's directive by entering additional findings of fact and conclusions on the jurisdictional issue. In the interim, however, defendants filed notice of appeal on 12 April 2006 from the trial court's 20 February 2006 order enforcing the mediated settlement agreement.
In their first argument, defendants contend that the trial court lacked jurisdiction to enter the 20 February 2006 order enforcing the terms of the mediated settlement agreement. We disagree.
In North Carolina, "[a]s a general rule, once a party gives notice of appeal, such appeal divests the trial court of its jurisdiction." RPR & Assocs. v. Univ. of N. Carolina-Chapel Hill (RPR II), 153 N.C. App. 342, 346, 570 S.E.2d 510, 513 (2002),disc. rev. denied and cert. dismissed, 357 N.C. 166, 579 S.E.2d 882 (2003). This result is obtained either through application of the common law doctrine of functus officio or the automatic stay pursuant to North Carolina General Statutes, section 1-294. "Functus officio, which translates from Latin as `having performed his or her office,' is defined as being `without further authority or legal competence because the duties and functions of the original commission have been fully accomplished.'" Id. at 347, 570 S.E.2d at 513 (quoting Black's Law Dictionary 682 (7th ed. 1999)). Section 1-294, in turn, provides that "[w]hen an appeal is perfected as provided by this Article it stays all further proceedings in the court below upon the judgment appealed from, or upon the matter embraced therein." N.C. Gen. Stat. . 1-294 (2005).
Pursuant to either the doctrine offunctus officio or section 1-294, a trial court's continued jurisdiction following notice of appeal from an interlocutory order depends upon the nature of the interlocutory order — namely, whether or not the order was immediately appealable. See RPR II, 153 N.C. App. at 347, 570 S.E.2d at 514. As this Court has noted,
if a party appeals an immediately appealable interlocutory order, the trial court has no authority, pending the appeal, to proceed with the trial of the matter. Where a party appeals from a nonappealable interlocutory order, however, such appeal does not deprive the trial court of jurisdiction, and thus the court may properly proceed with the case.
Id. (emphasis in original) (internal citation omitted). An interlocutory order that affects a substantial right —i.e., a right that "will clearly be lost or irremediably and adversely affected if the order is not reviewed before final judgment" — is immediately appealable. Id. Such a determination, however, must be made on a case-by-case basis, and "there are `no hard and fast rules . . . for...
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