Scott & Jones v. Carlton Ins. Agency Inc.
| Decision Date | 07 April 2009 |
| Docket Number | No. COA08-745.,COA08-745. |
| Citation | 677 S.E.2d 848 |
| Court | North Carolina Court of Appeals |
| Parties | SCOTT & JONES, INC., Plaintiff, v. CARLTON INSURANCE AGENCY, INC., and Hugh Carlton Individually, Defendants. |
Eugene C. Covington, Jr., Greenville, for plaintiff-appellant.
Cranfill Sumner & Hartzog, LLP, by Susan K. Burkhart, Raleigh, for defendants-appellees.
Plaintiff appeals order allowing defendants' motion for summary judgment. We affirm, as plaintiff's action is barred by the statute of limitations.
On 31 October 2006, plaintiff filed a complaint against defendants for negligence and breach of contract. Plaintiff alleged:
4. Defendants Carlton Insurance and Hugh Carlton, have acted as the insurance agent for Scott & Jones, Inc. for many years. Scott & Jones, Inc. is unsophisticated in the area of insurance and relied upon the Defendants for insurance advice and counsel. The Defendants undertook the responsibility of procuring and advising Scott & Jones, Inc. on the insurance coverage Scott & Jones needed in the operation of its business. Relying on the Defendants, Scott & Jones Inc. has for many years obtained commercial general liability policies of insurance in connection with the operation of the business of Scott & Jones, Inc.
5. On January 24, 2002, Ohio Casualty Insurance Company issued a commercial package policy and commercial general liability policy (hereinafter "Primary Policy"), Policy No. BKO(03)52 48 77 99 and a commercial umbrella coverage policy (hereinafter "Umbrella Policy"), Policy No. BKO(03) 52 48 77 99, to Plaintiff Scott & Jones, Inc. The policies effective dates were from March 1, 2002 to March 1, 2003. A true and accurate copy of these policies is attached hereto as Exhibit A. Both policies were procured by the Defendants for the Plaintiff Scott & Jones, Inc.
6. That on or about March 1998, Scott & Jones, Inc. in the normal course of their business, installed a grain silo at C & M Hog Farms, Inc., located in Latta, South Carolina.
7. That on February 3, 2003, an employee at C & M Hog Farms, Inc., Willie MacMillan, was severely injured and rendered paraplegic in a fall from the ladder that was attached to the silo installed by Scott & Jones, Inc. in March of 1998.
8. On October 6, 2004, a suit was filed by Willie MacMillan against Defendant Scott & Jones, Inc., et al. (hereinafter "McMillan Litigation["]) in the Court of Common Pleas, County of Dillon, South Carolina, arising out of the fall on February 3, 2003. The Complaint alleged that Scott & Jones was negligent in the installation of the grain silo in March of 1998. On November 15, 2004, the action was removed to the U.S. District Court, Florence Division (# 4:04-22972).
9. On March 14, 2005, a declaratory judgment action was filed by Ohio Casualty Insurance Company against Scott & Jones, Inc., in the U.S. District Court, Florence Division (# 4:05-807) to determine Ohio Casualty's obligations under its contracts of insurance with Scott & Jones, Inc. On August 25, 2006, the U.S. District Court found in favor of Ohio Casualty Insurance Company, issuing an Order that Ohio Casualty has no duty to defend or indemnify Scott & Jones, Inc. in the McMillan Litigation inasmuch as the policies procured by the Defendants did not include a separate products completed operations coverage, leaving Scott & Jones, Inc, completely uninsured with regard to the MacMillan Litigation (See attached Exhibit B).
10. On August 18, 2006, judgment was entered in favor of MacMillan against Scott & Jones, Inc. in the amount of $5,000,000.00. (See attached Exhibit C).
11. That at all times relevant hereto, the Defendants represented and assured Scott & Jones, Inc. that the insurance coverage they had purchased covered all reasonable and necessary risks of Scott & Jones, Inc. business, including claims after completion of the Plaintiff's work.
On or about 6 February 2007, defendants filed an amended answer alleging several affirmative defenses, including the statute of limitations. On or about 21 February 2008, defendants filed a motion for summary judgment. On 28 March 2008, defendants' motion for summary judgment was allowed and plaintiff's action was dismissed with prejudice. Plaintiff appeals arguing the trial court erred in granting defendants' motion for summary judgment.
We [first] note that the argument section of appellant's brief is single spaced in violation of Rule 28(j) of the Rules of Appellate Procedure.... In our discretion, we do not impose sanctions upon counsel pursuant to Rule 34. However, counsel is admonished that compliance with the Rules of Appellate Procedure is mandatory.
State v. Hudgins, ___ N.C.App. ___, ___, 672 S.E.2d 717, 721, (2009).
The trial court's order did not state the specific reason for its order granting summary judgment in favor of defendant. However, defendant asserted several defenses, including the statute of limitations, in its amended answer. Plaintiff argues that the statute of limitations is not a proper ground upon which to base dismissal of its claims by summary judgment.
When the affirmative defense of the statute of limitations has been pled, the burden is on the plaintiff to show that his cause of action accrued within the limitations period. On appeal from an order granting summary judgment, our standard of review is de novo, and we view the evidence in the light most favorable to the non-movant.
Baum v. John R. Poore Builder, Inc., 183 N.C.App. 75, 80, 643 S.E.2d 607, 610 (2007) (citations and quotation marks omitted).
Generally, whether a cause of action is barred by the statute of limitations is a mixed question of law and fact. However, where the statute of limitations is properly pled and the facts are not in conflict, the issue becomes a matter of law, and summary judgment is appropriate.
Rowell v. N.C. Equip. Co., 146 N.C.App. 431, 434, 552 S.E.2d 274, 276 (2001) (citations and quotation marks omitted).
Plaintiff argues that its claims for negligence and breach of contract constitute claims for professional malpractice, and thus the applicable statute of limitations is up to four years pursuant to N.C. Gen.Stat. § 1-15(c) and relevant case law, instead of three years pursuant to N.C. Gen.Stat. § 1-52, which identifies the statute of limitations for general negligence and breach of contract claims. Plaintiff contends it is subject to the professional malpractice statute of limitations in N.C. Gen.Stat. § 1-15(c) because defendants breached a professional fiduciary duty. Though plaintiff argues that the professional malpractice statute of limitations is applicable in the present case, plaintiff has not directed us to, nor have we found, any North Carolina case in which the professional malpractice statute of limitations has been applied to insurance agents.
N.C. Gen.Stat. § 1-15(c) provides,
Except where otherwise provided by statute, a cause of action for malpractice arising out of the performance of or failure to perform professional services shall be deemed to accrue at the time of the occurrence of the last act of the defendant giving rise to the cause of action....
N.C. Gen.Stat. § 1-15(c) (2005) (emphasis added).
Under the plain language of N.C. Gen.Stat. § 1-15(c), a cause of action for professional malpractice must arise from "the performance of or failure to perform professional services[.]" See id. Neither N.C. Gen.Stat. § 1-15(c), nor Chapter 1 in general provides a definition for "professional services" and our case law has not provided much additional assistance in defining this term. Our Supreme Court has noted that "[t]he term `professional services' refers to those services where a professional relationship exists between plaintiff and defendant — such as a physician-patient or attorney-client relationship." Barger v. McCoy Hillard & Parks, 346 N.C. 650, 665, 488 S.E.2d 215, 223 (1997) (citations and quotation marks omitted). In Roberts v. Durham County Hosp. Corp., the plaintiffs argued N.C. Gen.Stat. § 1-15(c) "is unconstitutionally vague because it fails to define `malpractice' or `professional services'" and that "it is difficult to determine whether certain occupations fall within the statute so as to be entitled to assert the limitation period within N.C. Gen.Stat. § 1-15(c)." 56 N.C.App. 533, 537, 289 S.E.2d 875, 878 (1982), aff'd per curiam, 307 N.C. 465, 298 S.E.2d 384 (1983). Our Supreme Court determined that N.C. Gen.Stat. § 1-15(c) was not unconstitutionally vague as applied to a medical doctor and a hospital, noting that Id. (quoting Broadrick v. Oklahoma, 413 U.S. 601, 93 S.Ct. 2908, 37 L.Ed.2d 830 (1973)). The Court also stated that "[w]here a term such as ... `professional service' has been used over such a lengthy period of time that its usage has given the term well-defined contours such a term will not be found inadequate." Id. at 537-38, 289 S.E.2d at 878 (citation omitted). As we are not aware of any North Carolina case which has held that insurance agents are providers of "professional services" for the purpose of the statute of limitations in N.C. Gen.Stat. § 1-15(c), we certainly cannot cite to usage of the term as to insurance agents over "a lengthy period of time" nor does the term have "well-defined contours" as a "professional service" in the context of this case. Id.
In addition, we believe that Pierson v. Buyher is persuasive authority with which to conclude that insurance agents are not...
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