O'Neal by and through Small v. O'Neal

Decision Date05 July 2017
Docket NumberNo. COA16-1299,COA16-1299
Parties Barbara G. O'NEAL, BY AND THROUGH G. Elvin SMALL, III, Guardian of the Estate of Barbara G. O'Neal, Plaintiff, v. Pamela Sue O'NEAL; Pamela Sue O'Neal, as Trustee of Barbara O'Neal Land Trust; Pamela Sue O'Neal, as Trustee of Barbara O'Neal Farm Land Trust; Pamela Sue O'Neal, as Trustee of Barbara O'Neal Barco Land Trust; Barbara O'Neal Land Trust; Barbara O'Neal Farm Land Trust; Barbara O'Neal Barco Land Trust; and Lori Ann Chappelle, Defendants.
CourtNorth Carolina Court of Appeals

G. Elvin Small, III, Elizabeth City, for plaintiff-appellee.

John M. Kirby, Raleigh, for defendants-appellants.1

ZACHARY, Judge.

Barbara G. O'Neal was adjudicated incompetent and defendant Pamela Sue O'Neal was appointed as Barbara's general guardian. Pamela was later removed from that position. An attorney was then appointed guardian of Barbara's estate, and the Currituck County Department of Social Services was appointed guardian of Barbara's person. Shortly before Pamela was removed as Barbara's guardian, Barbara executed a power of attorney appointing Pamela as her attorney-in-fact. Acting as Barbara's attorney-in-fact, Pamela executed three deeds transferring real property owned by Barbara to different land trusts. The guardian of Barbara's estate revoked the power of attorney. Barbara, by and through the guardian of her estate (plaintiff),2 then brought an action to have the power of attorney and the deeds declared void. After plaintiff filed her complaint and defendants filed their answer, the superior court entered an order granting judgment on the pleadings in favor of plaintiff. For the reasons that follow, we affirm the superior court's order.

I. Background

Pamela is the granddaughter of Barbara. In July 2011, Pamela filed a petition to have Barbara, who was seventy-nine years old at the time, adjudicated incompetent. The petition stated, inter alia , that Barbara suffered from "a long history of prescription substance abuse[,]" that she had been transferred "to Currituck House Assisted Living," and that she suffered from "[m]ajor [d]epression with chronic anxiety, seizure disorder, memory loss, hypothyroidism

[,] and diabetes." Pamela also alleged that Barbara lacked the capacity to handle her financial affairs or to "resist attempts of financial exploitation" by others. As a result, the Currituck County Clerk of Superior Court entered an order on 17 August 2011, which adjudicated Barbara incompetent, retaining no rights or privileges. The order also appointed Pamela as Barbara's general guardian.

Four years later, the clerk revoked Pamela's letters of general guardianship in an order entered 12 October 2015. The clerk found that, as "the sole heir at law of Barbara O'Neal[,]" Pamela had a "private interest in [Barbara's estate,]" and that "this private interest might tend to hinder or be adverse to Pamela O'Neal in the carrying out of her duties as General Guardian[.]" However, on 10 October 2015, two days before the clerk's revocation order was entered, Barbara executed a durable power of attorney appointing Pamela as her attorney-in-fact. The power of attorney was recorded in the Office of the Currituck County Register of Deeds on 30 October 2015. That same day, two quitclaim deeds were executed by Pamela as attorney-in-fact for Barbara. The first deed conveyed certain real property owned by Barbara to the "Barbara O'Neal Land Trust[,]" and the second deed conveyed a 13.10-acre parcel owned by Barbara to the "Barbara O'Neal Farm Land Trust[.]" On 10 November 2015, Pamela, as attorney-in-fact for Barbara, executed a quitclaim deed conveying Barbara's interest in a 87-acre parcel to the "Barbara O'Neal Barco Land Trust." Pamela was named trustee of all the aforementioned land trusts. All three deeds were recorded in the Office of the Currituck County Register of Deeds.

On 18 November 2015, attorney G. Elvin Small, III was appointed the guardian of Barbara's estate. Acting on behalf of Barbara, Small revoked the October 2015 power of attorney executed in favor of Pamela. Pamela then procured Barbara's signature on a second power of attorney on 4 December 2015, again naming Pamela as Barbara's attorney-in-fact. The second power of attorney, which was also revoked by Small, was not used to conduct any transactions on Barbara's behalf.

On 1 April 2016, Small, as guardian of Barbara's estate, instituted the present action in Currituck County Superior Court seeking, inter alia , a judgment declaring both of Pamela's powers of attorney as well as the 30 October 2015 and the 10 November 2015 deeds to be null and void. In her answer to plaintiff's complaint, Pamela admitted that Barbara had been adjudicated incompetent on 17 August 2011, and that Barbara's competence had not been restored. In June 2016, plaintiff filed a motion for judgment on the pleadings pursuant to Rule 12(c) of the North Carolina Rules of Civil Procedure.

A hearing was conducted by Judge Walter H. Godwin, who entered an order granting plaintiff's motion for judgment on the pleadings. The superior court's order, filed 8 August 2016, provided that the two powers of attorney executed by Barbara appointing Pamela as attorney-in-fact were void ab initio , as were the three deeds that Pamela executed as Barbara's attorney-in-fact in October and November 2015. The superior court ruled that these instruments were void because they were "executed by Barbara G. O'Neal, a person who was adjudicated incompetent on August 18, 2011, and whose legal competency has not been restored, or they ... were executed on her behalf by the attorney in fact named in a power of attorney executed by said incompetent person." Pamela and the other named defendants appeal from the superior court's order granting judgment on the pleadings in favor of plaintiff.

II. Standard of Review

This Court reviews a trial court's ruling on a Rule 12(c) motion for judgment on the pleadings de novo . Toomer v. Branch Banking & Trust Co. , 171 N.C. App. 58, 66, 614 S.E.2d 328, 335 (2005). Because "[j]udgments on the pleadings are disfavored in law, ... the trial court must view the facts and permissible inferences in the light most favorable to the non-moving party." Groves v. Community Hous. Corp. , 144 N.C. App. 79, 87, 548 S.E.2d 535, 540 (2001) (citation omitted). Even so, judgment on the pleadings "is appropriate when all the material allegations of fact are admitted in the pleadings and only questions of law remain." Id. (internal citations and quotation marks omitted).

III. Powers of Attorney

"A power of attorney is an instrument in writing granting power in an agent to transact business for his principal." Cabarrus Bank & Trust Co. v. Chandler , 63 N.C. App. 724, 726, 306 S.E.2d 184, 185 (1983) (citations omitted). The agency relationship that results is between "one who gives the power, the principal, and one who exercises authority under the power of attorney, the agent." Whitford v. Gaskill , 119 N.C. App. 790, 793, 460 S.E.2d 346, 348 (1995), rev'd on other grounds , 345 N.C. 475, 480 S.E.2d 690 (1997). Any act performed by the agent is as if the principal had performed it. See Branch Banking and Trust Co. v. Creasy , 301 N.C. 44, 56, 269 S.E.2d 117, 124 (1980) ("An agent is one who acts for or in the place of another by authority from him."). Although special rules apply to the fiduciary relationship between a principal and agent, there is, as a general matter, little reason to draw distinctions between powers of attorney and contracts. See Hedgepeth v. Home Savs. & Loan Ass'n , 87 N.C. App. 610, 612, 361 S.E.2d 888, 890 (1987) (determining that power of attorney at issue "should be treated the same as any other contract") (citations omitted); 12 Williston on Contracts § 35:1, at 202 (4th ed. 2012) ("An agency contract is formed according to the same rules that are applicable to any other contract; an agency is created in much the same manner as a contract is made, in that the agency results from an agreement between the principal and the agent to serve in that capacity."). As a result, we will apply general principles of contract law to the power of attorney that Barbara executed appointing Pamela her attorney-in-fact.

IV. Discussion

Defendants’ principal argument on appeal is that the superior court erred in declaring Pamela's first power of attorney (and the deeds she executed pursuant to that power) void ab initio . According to defendants, "[a]lthough a person declared incompetent lacks the capacity to enter contracts, such that contracts are voidable ..., an incompetent person retains many rights and powers to direct their care and finances." In support of this assertion, defendants cite case law holding that allegations concerning an incompetent person's ability to make a will or enter into marriage merely create an issue of fact as to whether the person possessed the necessary capacity to make the transaction at the time it was made. See Geitner v. Townsend , 67 N.C. App. 159, 312 S.E.2d 236 (1984) ; In re Will of Maynard , 64 N.C. App. 211, 307 S.E.2d 416 (1983). We disagree, and find that Geitner is inapposite to this case and that Maynard actually cuts against defendants’ argument.

In Geitner , a man married a woman after he had been adjudicated incompetent and placed under guardianship, and the question on appeal was whether the jury properly determined that the man had sufficient mental capacity to enter into the marriage. 67 N.C. App. at 160-161, 312 S.E.2d at 237-38. This Court went on to affirm the judgment entered upon the jury's verdict finding that the man had sufficient mental capacity to contract a valid marriage. Id. at 162, 312 S.E.2d at 239. In doing so, the Geitner Court specifically observed that " unlike other transactions , an insane person's capacity to marry is not necessarily affected by guardianship.... (R)easons why guardianship removes from the insane person all capacity to contract do not...

To continue reading

Request your trial
12 cases
  • Landcastle Acquisition Corp. v. Renasant Bank
    • United States
    • U.S. Court of Appeals — Eleventh Circuit
    • January 12, 2023
    ... ... use its non-bank-records evidence through another avenue ...          To do ... that, ... (Citation omitted)); ONeal v. ONeal, 803 S.E.2d 184, ... 189 (N.C. Ct. App. 2017) (holding, ...          So, ... Cassidy finds a small Atlanta-area bank named Old Bank that ... is severely distressed. He ... ...
  • Landcastle Acquisition Corp. v. Renasant Bank
    • United States
    • U.S. Court of Appeals — Eleventh Circuit
    • January 12, 2023
    ...2017) ("A contract executed by a party that does not have authority is void ab initio ." (citation omitted)); O'Neal v. O'Neal , 254 N.C.App. 309, 803 S.E.2d 184, 189 (2017) (holding, where an agent acted under an invalid grant of power of attorney, that "the deeds that [the agent] executed......
  • State v. Cobb
    • United States
    • North Carolina Court of Appeals
    • July 5, 2017
  • Walter v. Walter
    • United States
    • North Carolina Court of Appeals
    • December 31, 2020
    ...there is, as a general matter, little reason to draw distinctions between powers of attorney and contracts." O'Neal v. O'Neal , 254 N.C. App. 309, 312, 803 S.E.2d 184, 187 (2017). We therefore "treat the power of attorney at issue in this case the same as any other contract." Id. at 315, 80......
  • Request a trial to view additional results

VLEX uses login cookies to provide you with a better browsing experience. If you click on 'Accept' or continue browsing this site we consider that you accept our cookie policy. ACCEPT