Kornegay v. Aspen Asset Group LLC
| Citation | 693 S.E.2d 723 |
| Decision Date | 01 June 2010 |
| Docket Number | No. COA09-71.,COA09-71. |
| Parties | Timothy G. KORNEGAY, Plaintiff,v.ASPEN ASSET GROUP, LLC, C. Steve Clardy, Michael H. Clardy, Carlton S. Clardy, Jr., Rocking B. Farms, LLC, Basic Electric Company, Inc., and Earth Products Company, LLC, Defendants. |
| Court | Court of Appeal of North Carolina (US) |
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Appeal by defendants and cross-appeal by plaintiff from judgment entered 5 February 2008 and order and modified judgment entered 4 June 2008 by Judge Albert Diaz in Mecklenburg County Superior Court. Heard in the Court of Appeals 10 June 2009.
Bishop, Capitano & Moss, P.A., by J. Daniel Bishop and Joseph W. Moss, Jr., Charlotte, for plaintiff.
James, McElroy & Diehl, P.A., by Gary S. Hemric, John S. Arrowood, John R. Buric, and Preston O. Odom, III, Charlotte, for defendants.
This appeal arises out of a dispute over an alleged bonus compensation scheme between plaintiff Timothy G. Kornegay and his employer, defendant Aspen Asset Group, LLC (“Aspen”), which is owned by defendants C. Steve Clardy (“Steve Clardy”), Michael H. Clardy (“Mike Clardy”), and Carlton S. Clardy Jr. (“Chip Clardy”). Defendants have appealed from the trial court's denial of their motion for judgment notwithstanding the verdict (“JNOV”), contending plaintiff presented insufficient evidence of an enforceable oral contract. Because we believe the evidence, taken in the light most favorable to plaintiff, was sufficient to allow the jury to determine the existence of an enforceable oral contract, we affirm the trial court's denial of defendants' motion for JNOV.
Defendants also argue the trial court erred in remitting the jury's damages award rather than granting defendants' request for a new trial on both liability and damages. Based upon our review of the jury's verdict, the evidence, and the issues in dispute, we hold that the trial court did not abuse its discretion in denying a new trial on all issues.
Plaintiff has cross-appealed from the trial court's denial of his motion for attorneys' fees and liquidated damages under the North Carolina Wage and Hour Act (“NCWHA”). We hold that the trial court's findings of fact, which are supported by competent evidence, are sufficient to support its denial of liquidated damages and attorneys' fees.
Plaintiff met the Clardys in the early 1970s when he attended high school with Mike and Chip Clardy. Steve Clardy, the father of Mike and Chip, was the boys' scoutmaster in their Boy Scouts troop. The Clardys own Aspen (an investment holding company that buys, sells, and manages real estate investments), as well as defendants Rocking B. Farms, LLC, Basic Electric Company, Inc., and Earth Products Company, LLC. The parties kept in touch over the years, and when plaintiff left another job in May 1996, he sent the Clardys his resume and told them he was looking for work.
After receiving plaintiff's resume, Chip Clardy contacted plaintiff and indicated that Steve Clardy wanted to speak with him about a possible job opportunity. Plaintiff and Steve Clardy met approximately eight times between July and September 1996, discussing various ways that plaintiff might work for the Clardys. The content of those discussions is at the heart of the dispute in this case.
Plaintiff contends that in the course of those discussions, he and Steve Clardy entered into an oral employment contract. According to plaintiff, his duties under the contract were to identify and present to the Clardys attractive real estate investment opportunities and, if given approval, to acquire, modify, and resell or lease those properties for profit. In exchange, plaintiff would receive an annual salary of $72,000.00 and bonuses under a compensation scheme based on a system of “origination” and “implementation.” “Origination” included scouting out available properties and determining which properties might be a good investment. “Implementation” involved plaintiff's performing required due diligence, closing the sale, and handling the improvements and leasing of the property. Plaintiff contends that he was supposed to receive 20% of the profits from investment projects he originated and implemented and would receive “fair” compensation for implementing investment projects that he did not originate.
Defendants, on the other hand, argue that the conversations between plaintiff and Steve Clardy were nothing more than negotiations and that the parties intended to enter into a written agreement at a later date. It is undisputed by the parties that no written agreement exists. Although plaintiff and Steve Clardy exchanged several drafts of an agreement, none of the drafts was ever agreed upon or signed.
Plaintiff worked for Aspen from 1 October 1996 through 25 June 2004. During his employment, Aspen paid plaintiff $72,000.00 annually, but never paid any bonuses. The parties agree that plaintiff originated eight properties for the Clardys. Plaintiff claims, however, that he also originated one more property, the Love property. After all of these properties had been acquired by Aspen, plaintiff, in one of his paychecks, received a handwritten note dated 27 June 2002 that stated:
Aspen sees fit & confident we are making money. Subsequently, on 11 September 2003, Aspen sold three of the properties. The other six properties remained unsold as of the trial.
On 14 December 2004, plaintiff brought suit against defendants in Mecklenburg County Superior Court. Plaintiff alleged that Aspen breached their contract by failing to pay him bonuses of 20% of the profits of investments he originated and implemented and bonuses of a “fair” percentage of the profits of investments he implemented but did not originate. Plaintiff also asserted claims against all defendants for (1) violation of the NCWHA, (2) quantum meruit, and (3) fraud. The case was ultimately assigned to the Business Court.
Defendants moved for summary judgment on 5 April 2006, while plaintiff moved for partial summary judgment on 11 May 2006. On 27 September 2006, the trial court entered an order denying summary judgment on plaintiff's breach of contract claim for the 20% bonus on investments he originated and implemented, but granting summary judgment to defendants on plaintiff's breach of contract claim for the “fair” bonuses on investments he implemented but did not originate. The trial court permitted plaintiff to proceed against (1) all defendants under the NCWHA; (2) only Aspen, Rocking B. Farms, Basic Electric, and Earth Products in quantum meruit; and (3) only Aspen and Steve Clardy for fraud.
At the close of plaintiff's case at trial, the trial court directed a verdict in favor of Rocking B. Farms, Basic Electric, and Earth Products on all claims and in favor of all defendants on the fraud claim. The court further concluded that plaintiff was entitled only to nominal damages on the quantum meruit claim asserted against all defendants. The trial court denied renewed directed verdict motions at the close of all the evidence and submitted the surviving claims to the jury.
On 12 December 2007, the jury rendered its verdict, making special findings of fact. It found that plaintiff and Aspen had entered into a contract and that Aspen had breached that contract. It further found that Steve and Mike Clardy, but not Chip Clardy, were statutory employers of plaintiff under the NCWHA. The jury next found that plaintiff had originated and implemented the Love property and that defendants could have sold the six unsold properties for a profit in the exercise of reasonable care and judgment. The jury concluded that plaintiff was entitled to damages in the amount of $996,147.60.
Plaintiff moved for entry of judgment on the jury's verdict and for an award of liquidated damages under the NCWHA in the amount of the verdict, for attorneys' fees in the amount of $315, 802.21, and costs of $9, 869.45. At the hearing on plaintiff's motion, plaintiff also submitted a request for prejudgment interest in the amount of $124,518.00.
On 5 February 2008, the trial court entered judgment on the jury's breach of contract verdict in the amount of $996,147.60. The court concluded that the breach of contract amount should also be considered wages under the NCWHA and that Aspen, Steve Clardy, and Mike Clardy were liable jointly and severally for the unpaid wages. With respect to the request for liquidated damages, the trial court found that defendants had acted in good faith in discharging their obligations and had a reasonable basis for believing that their refusal to pay bonuses was not in violation of the NCWHA. The trial court, therefore, exercised its discretion not to award liquidated damages. The court also declined to award attorneys' fees although it did grant the request for costs. The trial court awarded prejudgment interest as to the three properties that had actually been sold, but declined to award prejudgment interest as to the remaining six properties because the court could not determine when the bonuses on those properties became due. Finally, the court dismissed the claim for quantum meruit since the jury had awarded damages for breach of an express contract.
Defendants moved for JNOV or, in the alternative, for (a) a new trial on both liability and damages; (b) a new trial on damages; or (c) remittitur of the damage award. In an order entered 28 April 2008, the trial court concluded that it could not reconcile the jury's award of $996,147.60 with the evidence admitted at trial and plaintiff's request to the jury for $825,070.40. The trial court noted that plaintiff had objected to remittitur and, therefore, granted a new trial as to damages only.
Subsequently, in an order dated 29 May 2008, the trial court stated that plaintiff had clarified that he did not intend to object to remittitur. The trial court, therefore, denied the motion for a...
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Morris v. Scenera Research, LLC
...is prevented from rescinding them,” but for certain unrelated exceptions. Kornegay v. Aspen Asset Grp., LLC, 204 N.C.App. 213, 229–30, 693 S.E.2d 723, 735–36 (2010) (citation omitted; emphasis in original). Defendants argue that Morris failed to present evidence that he “earned” the issuanc......
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Morris v. Scenera Research, LLC, COA12-1481
...is prevented from rescinding them," but for certain unrelated exceptions. Kornegay v. Aspen Asset Grp., LLC, 204 N.C. App. 213, 229-30, 693 S.E.2d 723, 735-36 (2010) (citation omitted; emphasis in original). Defendants argue that Morris failed to present evidence that he "earned" the issuan......
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McCabe v. Abbott Labs., Inc.
...Abbott did not violate section 95–25.13(3). McCabe argues to the contrary and cites Kornegay v. Aspen Asset Group, LLC, 204 N.C.App. 213, 693 S.E.2d 723 (2010), and Arndt v. First Union National Bank, 170 N.C.App. 518, 613 S.E.2d 274 (2005). In Kornegay, the employer notified the plaintiff ......
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McCabe v. Abbott Labs., Inc., 5:13–CV–125–D.
...Abbott did not violate section 95–25.13(3).McCabe argues to the contrary and cites Kornegay v. Aspen Asset Group, LLC, 204 N.C.App. 213, 693 S.E.2d 723 (2010), and Arndt v. First Union National Bank, 170 N.C.App. 518, 613 S.E.2d 274 (2005). In Kornegay, the employer notified the plaintiff t......