Edmunds v. Edmunds

• Decision Date: 16 December 2008
• Docket Number: No. COA08-246.,COA08-246.
• Citation: 669 S.E.2d 874
• Court: North Carolina Court of Appeals
• Parties: Donald P. EDMUNDS, Plaintiff v. Phyllis M. EDMUNDS, Defendant.

669 S.E.2d 874

Donald P. EDMUNDS, Plaintiff v. Phyllis M. EDMUNDS, Defendant.

No. COA08-246.

Court of Appeals of North Carolina.

December 16, 2008.

Appeal by defendant from order entered 31 August 2007 by Judge Nancy C. Phillips in Columbus County District Court. Heard in the Court of Appeals 10 September 2008.

The McGougan Law Firm, by Paul J. Ekster and Dennis T. Worley, Tabor City, for plaintiff-appellee.

Williamson, Walton & Scott, L.L.P., by Benton H. Walton, III, C. Martin Scott, II, Whiteville, and Thomas L. Odom, Jr., Charlotte, for defendant-appellant.

CALABRIA, Judge.

This appeal arises from an order denying a motion for relief under Rules 54, 55, 58, and 60 of our Rules of Civil Procedure filed by Phyllis M. Edmunds ("defendant") and Elizabeth E. High ("Ms. High"). The trial court held that both defendant and Ms. High lacked standing to bring the motion and also denied Ms. High's motion to be joined as a defendant. For the reasons stated below, we affirm in part and reverse in part.

I. Background

On 1 August 1986, William Seymour Edmunds ("the deceased") and defendant executed a pre-marital agreement. The agreement reserved to each party the "right to dispose of any or all of [each party's] Separate Property by deed, will, or otherwise on that [party's] sole signature, without any involvement or control by the other party, and the other party hereby ratifies and consents to any such disposition." The agreement also stated, in relevant part:

The Husband further agrees that should he predecease the Wife during the marriage and while the parties are neither legally nor voluntarily separated that the Wife shall receive a life estate in the separate real property owned by the Husband as his residence in the Town of Lake Waccamaw, North Carolina. The life estate shall entitle the Wife to hold, use, and benefit from this property so long as she does not re-marryk [sic] and so long as she maintains the real property as her primary residence, pays all taxes and assessments that may becom [sic] due, keeps the residence adequately insured, and provides such maintenances [sic] to the property as may be necessary to maintain the fair market value of the property. Upon the death of the Wife, or if she should re-marry or fail to perform any of the provisions stipulated herein, the remainder interest in the aforementioned real property shall pass to Donald P. Edmunds, son of the Husband or as directed by the Husband's will.

The property in question, 1800 Lake Cove Rd, Lake Waccamaw, North Carolina ("the property"), is comprised of two and a half lots, located on the lakefront that includes a house, shed, pier, and boathouse. In 1999, the Town of Lake Waccamaw valued the property at $165,700.00.

On 22 April 1996, the deceased executed a last will and testament ("the will"), which stated, in relevant part:

ITEM EIGHT. I direct that my wife, Phyllis McLain Edmunds, retain a life estate in my residence located at 1800 Lake Cove Road, Lake Waccamaw, North Carolina. She shall have the exclusive use and benefit of the residence so long as she lives there on a full-time basis subject to the terms and conditions set forth in the Pre-Marital Agreement that she and I executed on August 1, 1986, said document being incorporated herein by reference.

ITEM NINE. I direct that all of the rest, residue, and remainder of my estate be divided equally between my wife, Phyllis McLain Edmunds, and my son, Donald P. Edmunds, by my Executor as nearly equally as possible.

The deceased died testate on 10 September 1996, survived by defendant and his son, Donald P. Edmunds ("plaintiff").

On 12 July 2000, plaintiff filed an action for quiet title and declaratory judgment. He alleged that since the deceased's death, defendant claimed the life estate in the property and "maintained possession of the house and land . . . thereby excluding Plaintiff from enjoyment and possession of his interest in said lands." He also alleged that defendant did not maintain the property as her primary residence, "failed to pay all taxes and assessments when they became due," "failed to maintain adequate insurance," and "failed to provide such maintenance to the property as is necessary to maintain the fair market value of the property." Plaintiff further alleged that plaintiff "wrongfully refused to execute a deed transferring the life estate conferred pursuant to the Pre-Marital Agreement and Last Will and Testament" of the deceased to plaintiff. Plaintiff sought the following relief:

WHEREFORE, the Plaintiff prays judgment that the cloud of said adverse claim of the Defendant be removed from his said title to said property and that the Plaintiff be declared the owner in fee simple of said property, free from the claim of the Defendant, and for the cost of this action to be taxed by the Clerk against the Defendant. In the alternative, Plaintiff prays that the Plaintiff be declared the owner in fee simple of said property, free from the claim of the Defendant through a Declaratory Judgment action.

A copy of the summons and complaint was mailed by certified mail to defendant at her Georgia address. Defendant signed the return receipt on 24 July 2000 and plaintiff filed an affidavit of return of service. When defendant did not respond, plaintiff filed a motion for entry of default on 30 August 2000. On the same day, the Clerk of Superior Court filed an entry of default against defendant. Plaintiff then filed a motion for entry of default judgment, alleging that he was "entitled to a judgment to quiet title and for a declaratory judgment in his favor[.]" On 16 November 2000, Judge Nancy C. Phillips entered a default judgment against defendant. Judge Phillips held:

1. That the Defendant's life estate, right, title, and interest in the land herein described, by reason of her failure to comply with the requirements of the Pre-Nuptial Agreement and the Last Will and Testament of William Seymour Edmunds, deceased, has terminated, and that the same is now vested in fee simple in the Plaintiff, Donald P. Edmunds, free from any right, title, or claim, by the Defendant or on account of any person claiming under the Defendant.

2. That this order shall be recorded in the Office of the Register of Deeds of Columbus County, terminating the life estate of the Defendant and vesting the fee simple ownership of the property in the Plaintiff.

(Emphasis added.)

Nearly four years later, in October 2004, defendant, in two separate quitclaim deeds, conveyed all of her "right, title, claim, and interest" in the property to Ms. High. The second quitclaim deed, clarified that it was defendant's "expressed intent and desire to reaffirm and ratify" the first quitclaim deed by this second deed in order to "confirm [her] intentions." On 21 October 2004, defendant also signed a power of attorney appointing Ms. High as her attorney in fact to "sell, convey, mortgage, lease, rent, or in any other way to manage, deal with, or dispose of" the property. "Th[e] power [was] given specifically for the purpose of acting as [defendant's] agent at any court proceedings, signing any pleadings and appearing at any hearings[.]"

Defendant explained, in the 21 October 2004 affidavit, that she "received a communication from Alan High ("Mr. High") in the middle part of September, 2004 regarding signing a quitclaim deed" for the property. Mr. High, a Columbus County attorney, is Ms. High's husband. Defendant continued,

4. I knew that I was coming to North Carolina this week to be with my sister-in-law who was having surgery, and I decided that I would deliver the quitclaim deed to Mr. High personally after meeting him, and I did drop in on him at his office on Monday, October 18, 2004 unannounced . . . .

6. [A]fter meeting with Mr. High, and after recalling what kind of a person Donald P. Edmunds was and is and how he treated my husband, his adopted father, and me previously, I have recommitted that I would like for Mr. High's family to have any interest in this property that I may have, rather than see it go to Donald P. Edmunds;

7. I have therefore returned to his office unannounced this date and have requested that he draft any documents necessary to confirm my conveyance of my interest to Elizabeth Elkins High and to empower her to act in my place and stead regarding any lawsuit over this property or otherwise and specifically regarding File # 00 CVD 1172, Columbus County wherein Donald P. Edmunds sued me to extinguish my life estate only in the property[.]

Defendant moved for relief from the default judgment on 7 June 2005. She alleged that a copy of the default judgment was never served on her and that there was no certificate of service of the default judgment in the official court file. She argued that there was no adversity or controversy between plaintiff and defendant with respect to their remainder interests as tenants in common and that the trial court lacked jurisdiction to determine the parties' rights with respect to their remainder interest as tenants in common. Accordingly, she asked the trial court to declare the default judgment void and set it aside.

On 7 June 2005, Defendant filed a motion, pursuant to Rule 25(d), seeking an order joining Ms. High in her action because she alleged Ms. High had acquired defendant's interest by the two quitclaim deeds. Defendant also moved to substitute Kyle A. Cox ("Cox") for plaintiff because plaintiff had conveyed his right, title, and interest in the property to Cox on or about 1 February 2007 by a non-warranty deed.

The trial court denied defendant's motion. It found as fact that defendant's claim of possessing a one-half undivided interest in the property through the residuary clause of the deceased's will was without merit; that only $1.00 in tax stamps was paid on the quitclaim deed, indicating that Ms. High paid, at most, $500.00 for the property; and that the property was worth $500,000.00 to $750,000.00. The court...