Stratton v. Royal Bank of Canada
| Decision Date | 05 February 2010 |
| Docket Number | 07 CVS 15079 |
| Citation | 2010 NCBC 2 |
| Court | Superior Court of North Carolina |
| Parties | ELIZABETH BRUCE STRATTON, Plaintiff v. ROYAL BANK OF CANADA, Defendant |
McDaniel & Anderson, LLP by L. Bruce McDaniel, Esq. for Plaintiff.
Poyner & Spruill, LLP by David Dreifus, Esq. and John O'Hale, Esq. for Defendant.
THIS CAUSE, designated a complex business case by Order of the Chief Justice of the North Carolina Supreme Court, pursuant to N.C. Gen. Stat. § 7A-45.4(b) (), and assigned to the undersigned Special Superior Court Judge for Complex Business Cases, by order of the Chief Special Superior Court Judge for Complex Business Cases, is before the court upon the Defendant's Motion for Summary Judgment ("Motion") as to all claims ("Claims") stated in the Complaint, pursuant to the provisions of Rule 56, North Carolina Rules of Civil Procedure ("Rule(s)").
After considering the arguments, briefs, other submissions of counsel and appropriate matters of record, as discussed infra, the court concludes that the Defendant's Motion should be GRANTED.
[1] On September 20, 2007, Plaintiff Elizabeth Bruce Stratton ("Stratton") filed her Complaint for Declaratory Judgment, Related Mandatory Court Order, and Request for Jury Trial ("Complaint").
[2] On December 14, 2007, Stratton filed a Motion to Substitute Party Defendant RBC Centura Banks, Inc. with Royal Bank of Canada ("RBC"). This court granted that motion on January 2, 2008.
[3] In her Complaint, pursuant to various theories, Stratton prays that (a) the court issue a declaratory judgment against RBC to the effect that Plaintiff is the owner of all right, title and interest to at least 14, 486 shares of RBC common stock as successor shares to five original Bank of Manteo common stock shares owned by Plaintiff, plus any additional shares to which she may be entitled by virtue of accretion through stock dividends and stock splits; (b) the court order RBC to issue the foregoing number of shares to Stratton and (c) Stratton recover from RBC any money dividends to which she would have been entitled by such successor shares.[1]
[4] The court heard oral argument on the Motion, and it is ripe for determination.
[5] Unless otherwise indicated herein, the material facts reflected in paragraphs 6 through 21, 39 and 40 of this Opinion and Order exist, are undisputed[2] and are pertinent to the issues raised by the Motion.
[6] In 1927, Matilda Ethridge purchased five shares of stock of the Bank of Manteo, represented by certificate number 86.[3]
[7] In 1933, Matilda Ethridge was listed as a shareholder in a Bank of Manteo document entitled "Stockholders Assent to Change."[4] This was the last mention of Matilda Ethridge as a shareholder of the Bank of Manteo.
[8] In 1935, Matilda Ethridge changed her name to Matilda E. Inge ("Inge").[5]
[9] In 1962, the Bank of Manteo merged with Planters National Bank and Trust Company ("Planters Bank"), [6] with 2.8 shares of Planters Bank stock being issued for every one share of Bank of Manteo stock.[7] At this time, the year-round population of Manteo was approximately 800 people.[8] Plaintiff Stratton, Inge's daughter, was in college at the time of the merger. Stratton had been banking with Bank of Manteo, and became aware that Planters Bank had acquired the Bank of Manteo when she received a new checkbook reflecting the Planters Bank name.[9]
[10] At the time of the merger, the Bank of Manteo did not recognize Inge as a shareholder.[10]
[11] Inge died in 1980.[11] She had lived in Manteo, North Carolina for most of her life.[12] She was survived by Stratton, who served as executrix of Inge's estate.[13] Stratton is a citizen and resident of Dare County, North Carolina.[14]
[12] In 1982, Stratton discovered the stock certificate for five shares of stock of the Bank of Manteo.[15] According to Stratton, Inge had been private with respect to her finances, and Stratton had not known anything of her mother's business.[16]
[13] As executrix of Inge's will, Stratton did not list the Bank of Manteo stock certificate as property of the Inge estate.[17] On the Application for Probate and Letters Testamentary, in response to a space provided for Stratton to list any "stocks and bonds, " Stratton responded, "[n]one."[18] In her submission of a Final Accounting, dated August 15, 1986, Stratton did not list any stocks or bonds as belonging to the Inge estate.[19]
[14] In 1984 or 1985, Stratton asked a bank employee in the Planters Bank branch in Manteo to allow her to review a book of Bank of Manteo stocks held by the bank.[20]
[15] In 1985, Stratton asked a stockbroker to give her information about the stock. When he told her "just to leave it alone, " Stratton assumed the stock was of value and continued to hold it.[21]
[16] In 1985 or 1986, after an inquiry by Stratton's husband concerning what Stratton should do with the stock, an attorney in Manteo told Stratton's husband he did not have time to handle her request about the stock certificate.[22] Stratton was aware of this conversation.
[17] In 1986 or 1987, Stratton spoke with a retired attorney in Burgaw with regard to the value of the stock certificate. He advised her to seek advice from a law firm in Elizabeth City, which she did.[23] The attorney in Elizabeth City with whom she spoke requested a retainer.[24] Stratton paid his law firm a small retainer, but subsequently chose not to pursue the matter further at that point.[25]
[18] In November 1990, The Planters Corporation merged with Peoples Bancorporation to form Centura Banks, Inc., on the basis of a one-for-one share exchange.[26] Centura Banks, Inc. was the parent company of Centura Bank.[27]
[19] In June 2001, Centura Banks, Inc. was indirectly acquired by RBC, with 1.684 shares of RBC stock issued for each share of Centura Banks, Inc. stock.[28] RBC Centura Banks, Inc. is a wholly-owned subsidiary of RBC.[29]
[20] In 2003, Stratton asked her stepson, Steve Stratton, whether he would like to look into the stock certificate.[30]
[21] Stratton's request for replacement stock certificates and unpaid stock and money dividends was refused by RBC Centura Banks, Inc., on or about September 8, 2006.[31]
[22] Under Rule 56(c), summary judgment is to be rendered "forthwith" if the pleadings, depositions, answers to interrogatories and admissions on file, together with the affidavits, if any, show that there exists no genuine issue as to any material fact and that any party is entitled to a judgment as a matter of law. When the forecast of evidence demonstrates that the plaintiff cannot satisfy an essential element of a claim or overcome an affirmative defense established by the defendant, summary judgment for the defendant should be granted. Grayson v. High Point Dev. Ltd. P'ship, 175 N.C.App. 786, 788 (2006). In considering a Rule 56 motion, the court views the evidence in the light most favorable to the nonmoving party. Bruce-Terminix Co. v. Zurich Ins. Co., 130 N.C.App. 729, 733(1998).
PLAINTIFF'S CLAIMS
Declaratory Judgment
[23] In this case, the Plaintiff seeks a declaration that she is entitled, among other things, to at least 14, 486 shares of RBC common stock as successor shares to the five original Bank of Manteo common stock shares that Plaintiff inherited from her late mother.
[24] Plaintiffs Claim for declaratory relief generally is in the nature of an equitable action. However, her Claim for an award of RBC stock, plus unpaid dividends, appears to be one for coercive relief against RBC, which in substance seeks imposition of a constructive trust to Plaintiffs benefit.
[25] G.S. 1-253 provides:
Courts of record within their respective jurisdictions shall have power to declare rights, status, and other legal relations, whether or not further relief is or could be claimed. No action or proceeding shall be open to objection on the ground that a declaratory judgment or decree is prayed for. The declaration may be either affirmative or negative in form and effect; and such declaration shall have the force and effect of a final judgment or decree.
[26] Our courts have jurisdiction to render declaratory judgments only when the pleadings and evidence disclose the existence of an actual controversy between parties having adverse interests in the matter in dispute. Gaston Bd. of Realtors, Inc. v. Harrison, 311 N.C. 230, 234 (1984).
[27] A claim for declaratory judgment may be barred to the same extent that a claim for substantive relief on which it is based would be barred. Strong's North Carolina Index 4th, Declaratory Judgments § 26 (citing Plimpton v. Cooper, 141 F.Supp.2d 573 (W.D. N.C. 2001), aff'd, 21 F.App'x 159 (4th Cir. 2001)).
[28] In response to Plaintiffs Claim for declaratory relief, the Defendant raises defenses of lack of standing, laches and judicial estoppel. To Plaintiffs Claim for an award of RBC shares and dividends, Defendant raises defenses of laches and expiration of the statute of limitations.
[29] RBC argues that to the extent that any cause of action exists, that cause of action remains with the Inge estate and must be prosecuted, if at all, in the name of the estate and not in the name of Stratton, individually. As such, RBC contends, Stratton is not a proper party to this action, and the action must be dismissed.[32]
[30] Rule 17(a) requires every claim to be prosecuted or defended in the name of the real party in interest. Whittaker v. Furniture Factory Outlet Shops, 145 N.C.App. 169, 174-75 (2001). This is "the party who by substantive law has the legal right to enforce the claim in question, " Reliance Ins. Co. v. Walker, 33 N.C.App. 15, 19 (1977) (internal citation omitted), and more specifically, is "a party who is benefited or injured by the judgment in the...
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