Head v. Gould Killian Cpa Grp., P.A.
| Decision Date | 20 December 2016 |
| Docket Number | No. COA16-525,COA16-525 |
| Citation | 795 S.E.2d 142,251 N.C.App. 81 |
| Court | North Carolina Court of Appeals |
| Parties | Karen HEAD, Plaintiff, v. GOULD KILLIAN CPA GROUP, P.A., G. Edward Towson, II, CPA, Defendants. |
Erwin, Bishop, Capitano & Moss, PA, Charlotte, by J. Daniel Bishop and Matthew M. Holtgrewe, for plaintiff-appellant.
Sharpless & Stavola, P.A., Greensboro, by Brenda S. McClearn, for defendants-appellees.
Karen Head ("Plaintiff") appeals from the trial court's order granting Gould Killian CPA Group, P.A.’s and G. Edward Towson, II, CPA's ("Towson") (collectively "Defendants") motion for partial summary judgment and amended motion for partial summary judgment We affirm in part, reverse in part, and remand for trial on Plaintiff's professional negligence claim.
Plaintiff hired Defendants to prepare her tax returns for the 2005 tax year and subsequently employed them to prepare her taxes for tax years 2006, 2007, 2008 and 2009 respectively. Upon Defendants’ completion of the preparation of Plaintiff's 2005 returns, Plaintiff came to Defendants’ office, met with Towson, reviewed and signed her returns, tendered a check in the amount of taxes she owed, and requested that Towson mail her taxes to the Internal Revenue Service ("IRS") and several state tax agencies for her. Towson agreed to do so as a courtesy to Plaintiff, and deposited her completed returns in the mail.
For each of the ensuing four tax years, 2006 through 2009, Defendants were engaged to prepare Plaintiff's tax returns. However, these returns were not timely filed, as neither Defendants nor Plaintiff submitted them to or filed them with the IRS as required by the applicable deadlines.
On 4 November 2013, Plaintiff filed a complaint and alleged causes of action against Defendants for professional negligence and fraudulent concealment. Plaintiff also asserted a claim for punitive damages in connection with her fraudulent concealment claim. Plaintiff's complaint asserted Defendants had willfully and wantonly deceived Plaintiff by concealing from her the fact that they had failed to ensure her tax returns for tax years 2006 through 2009 were timely filed. As a result, she incurred tax penalties and interest.
Defendants filed a motion to dismiss and motion for attorneys’ fees pursuant to Rules 9(b) and 12(b)(6) of the North Carolina Rules of Civil Procedure. On 14 July 2014, the trial court entered an order denying this motion.
On 23 November 2015, Defendants filed a motion for partial summary judgment, and filed an amended motion for partial summary judgment on 9 December 2015. Defendants’ amended motion sought summary judgment on Plaintiff's claims for professional negligence regarding her 2006 and 2007 tax returns, as well as her fraudulent concealment and punitive damages claims. Defendants did not move for summary judgment on Plaintiff's professional malpractice claims relating to her 2008 and 2009 tax returns.
In support of their motion for partial summary judgment, Defendants submitted the following for consideration by the trial court: (1) a brief in support of their motion; (2) Plaintiff's complaint; (3) a document entitled "2006 Individual Income Tax Cover Sheet" along with an accompanying document entitled "Filing Instructions Individual Income Tax Return Taxable Year Ended December 31, 2006" provided to Plaintiff explaining the steps she needed to take in order to submit her prepared tax returns to the IRS; (4) a document entitled "2007 Individual Income Tax Cover Sheet" along with an accompanying document entitled "Filing Instructions Individual Income Tax Return Taxable Year Ended December 31, 2007" similar in all material respects to the 2006 cover sheet provided to Plaintiff for her 2007 prepared tax returns; (5) a deposition of Plaintiff; (6) IRS documents detailing Plaintiff's penalties and interest incurred in connection with her returns; (7) excerpts from a deposition of Defendants’ expert, Michael Gillis, explaining Defendants’ tax preparation procedures; and (8) a tolling agreement executed in 2013. Defendants additionally submitted various cases and statutes in support of their position.
Plaintiff, in response, submitted: (1) a brief in support of her position; (2) a series of emails between Towson, Plaintiff, and her assistant; (3) various correspondence and documents from the IRS; (4) Defendants’ responses to interrogatories; (5) the deposition of Edward Towson affirmatively stating that Plaintiff's prepared tax returns and accompanying instructions had been provided to her along with instructions on how to file them and the importance of doing so in a timely fashion; and (6) the log of IRS Revenue Officer Rosa Shade indicating she had never had certain discussions with Towson concerning Plaintiff's taxes despite his assertion to the contrary. Plaintiff additionally submitted various cases and statutes in support of her position.
The "2006 Individual Income Tax Cover Sheet" and accompanying "Filing Instructions Individual Income Tax Return Taxable Year Ended December 31, 2006" document submitted to the trial court stated, in pertinent part, the following:
At the bottom of the cover sheet after "How Delivered:" the following was written: "By Hand to Karen." The corresponding 2007 cover sheet and instructions, in turn, also similarly state: "How Delivered: Mailed to K. Head ... Picked up on 12/12/08."
On 31 December 2015, the trial court entered an order granting Defendants’ motions. Plaintiff filed notice of appeal on 19 January 2016.
Plaintiff argues the trial court erred in granting Defendants’ motion for summary judgment and amended motion for partial summary judgment. She asserts genuine issues of material fact exist concerning her professional negligence and fraudulent concealment claims regarding her tax returns.
We agree with Plaintiff that a genuine issue of material fact exists as to her professional negligence claim, and disagree with Plaintiff that the trial court erred in granting Defendants’ partial summary judgment motion concerning her fraudulent concealment and punitive damages claims.
Initially, we address whether this Court possesses jurisdiction over the present appeal. It is undisputed the present appeal is interlocutory. See Mecklenburg Cnty. v. Simply Fashion Stores, Ltd. , 208 N.C.App. 664, 667, 704 S.E.2d 48, 51 (2010) (citations omitted) ("An order is interlocutory when it does not dispose of the entire case but instead, leaves outstanding issues for further action at the trial level."). Generally, there is no right of immediate appeal from an interlocutory order. Goldston v. Am. Motors Corp. , 326 N.C. 723, 725, 392 S.E.2d 735, 736 (1990).
An interlocutory order may be appealed, however, if the order implicates a substantial right of the appellant that would be lost if the order was not reviewed prior to the issuance of a final judgment. It is the appealing party's burden to establish that a substantial right would be jeopardized unless an immediate appeal is allowed.
Radcliffe v. Avenel Homeowners Ass'n, Inc. , ––– N.C.App. ––––, ––––, 789 S.E.2d 893, 901 (2016) (internal citations, quotation marks, and footnote omitted).
It is well settled that a substantial right is affected " ‘where a possibility of inconsistent verdicts exists if the case proceeds to trial.’ " Heritage Operating, L.P. v. N.C. Propane Exch., LLC , 219 N.C.App. 623, 627, 727 S.E.2d 311, 314 (2012) ().
To demonstrate that a second trial will affect a substantial right, [the appellant] must show not only that one claim has been finally determined and others remain which have not yet been determined, but that (1) the same factual issues would be present in both trials and (2) the possibility of inconsistent verdicts on those issues exists.
Id. at 627–28, 727 S.E.2d at 314–15 (citation, internal quotation marks, and brackets omitted).
" ‘[S]o long as a claim has been finally determined, delaying the appeal of that final determination will ordinarily affect a substantial right if there are overlapping factual issues between the claim determined and any claims which have not yet been determined.’ " Carcano v. JBSS, LLC , 200 N.C.App. 162, 168, 684 S.E.2d 41, 47 (2009) (). "Issues are the ‘same’ if the facts relevant to their resolution overlap in such a way as to create a risk that separate litigation of those issues might result in inconsistent verdicts." Hamilton v. Mortg. Info. Servs., Inc. , 212 N.C.App. 73, 79, 711 S.E.2d 185, 190 (2011) (citing Davidson , 93 N.C.App. at 25, 376 S.E.2d at 491 ).
The present appeal presents overlapping factual issues concerning Plaintiff's business relationship with Defendants, which speak directly not only to her claims ruled upon by the trial court, but also her remaining professional negligence claims concerning her 2008 and 2009 returns. With the potential for inconsistent verdicts based upon a common factual nexus, we hold Plaintiff's appeal of the trial court's order affects a substantial right and is properly before us.
Entry of summary judgment is proper if the pleadings,...
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