Terry v. State

Decision Date07 February 2017
Docket NumberNo. COA16-153,COA16-153
CourtNorth Carolina Court of Appeals
Parties Robbie Dean Terry, Christopher Wayne Cook, Joshua Michael Barnhardt, Kevin Barringer, Brian M. Black, Barry Neal Burnette, Scott Casner, Demetrius Ray Clark, Robert Redell Dial, Malcom Eason, Gary W. Edwards, A. J. Gordon, Richard Hall, Derek Heintz, Lloyd Corey Hughes, Paul Daniel Hughes, Alan Michael Humphrey, Robert Mitchell Hunt, Stephen Hunt, Tully Langley, Charles Mack Latham, James Kelvin Locklear, Joe Travis Locklear, Johnny Ray Locklear, Michael Loukos, Samuel E. McLawhorn, Jerry L. Murphy, Rod Murphy, Nekime Matu Oxendine, Scott Richardson, Katherine Roberts, Jackie Rose, Eric C. Roten, Eric Schwartz, B. M. Sellers, Jr., Daniel T. Sharpe, Bradley D. Suddeth, Corey Thompson, Joshua S. Vernon, Michael Bailey, Jonathan Cochran, Kasey Cornwell, Blake Fisher, Angelis Geneao, Kathryn Geneao, Terry Gillespie, Brandon Sherrod Johnson, Mark Melvin, Jonathan Miller, Kurt D. Mills, Frank Odell, Jonathan Jason Sherill, Jason Stewart, Chad Thomas Walker, and Benjamin Shane Young, individually and on behalf of a class of similarly situated persons, Plaintiffs, v. State of North Carolina, Patrick L. McCory, Governor of the State of North Carolina, in his official capacity, Lee Harris Roberts, State Budget Director, in his official capacity, Dr. Linda Morrison Combs, State Controller, in her official capacity, and Frank L. Perry, Secretary, North Carolina Department of Public Safety, in his official capacity, Defendants.

Cloninger, Barbour, Searson & Jones, PLLC, Asheville, by Frederick S. Barbour and W. Scott Jones, and the Law Office of David A. Wijewickrama, Waynesville, by David A. Wijewickrama, for plaintiffs-appellants.

Joshua H. Stein, Attorney General, by Marc Bernstein, Special Deputy Attorney General, for defendants-appellees.

The McGuinness Law Firm, Elizabethtown, by J. Michael McGuinness, and the Law Office of Michael Byrne, by Michael C. Byrne, for amici curiae.

DAVIS, Judge.

Plaintiffs, a class consisting of state troopers who were employed by the State of North Carolina between 1 July 2009 and 30 June 2014, appeal from the trial court's order dismissing various claims asserted by them in connection with their contention that the North Carolina General Assembly improperly suspended certain future salary increases that had been promised to them. After careful review, we affirm.

Factual and Procedural Background

This dispute arises as a result of several legislative enactments by the General Assembly between 2009 and 2013 that had the effect of suspending anticipated future salary increases for state troopers. When Plaintiffs were hired by the State, N.C. Gen. Stat. § 20-187.3 provided, in pertinent part, as follows:

Members of the Highway Patrol shall be subject to salary classes, ranges and longevity pay for service as are applicable to other State employees generally. Beginning July 1, 1985, and annually thereafter, each member of the Highway Patrol shall be granted a salary increase in an amount corresponding to the increments between steps within the salary range established for the class to which the member's position is assigned by the State Human Resources Commission, not to exceed the maximum of each applicable salary range.

N.C. Gen. Stat. § 20-187.3(a) (2015).

The pay schedule referenced in N.C. Gen. Stat. § 20-187.3 stated that Plaintiffs would reach " ‘top base pay’ in a range of $50,000 and above within six to seven years of employment." The schedule further provided that during their employment, Plaintiffs' pay would increase on a "regular, scheduled, graduated basis" in order for them to reach "top pay" within the six- to seven-year time frame.

Beginning in 2009, the General Assembly passed a series of legislative enactments suspending pay increases for state troopers due to a major economic downturn that affected North Carolina. In 2009, it suspended salary increases for the 2009-2011 fiscal biennium. 2009 N.C. Sess. Law 451, § 26.1A(c). In 2011, it suspended salary increases for the 2011-2013 fiscal biennium. 2011 N.C. Sess. Law 145, § 29.8(c). In 2013, it suspended salary increases for the 2013-2015 fiscal biennium, 2013 N.C. Sess. Law 360, § 35.8(d), but it later revoked the suspension as to the 2014-2015 fiscal year. 2014 N.C. Sess. Law 360, § 35.8(d).

On 17 March 2014, Plaintiffs filed a complaint against the State and various State officials in their official capacities (collectively the "State") alleging claims for breach of contract, violations of their rights under the state and federal constitutions, negligent misrepresentation, declaratory judgment, and specific performance. In their complaint, Plaintiffs also sought class certification pursuant to Rule 23 of the North Carolina Rules of Civil Procedure. On 18 August 2015, the trial court entered an order in Wake County Superior Court granting Plaintiffs' motion for class certification.

After Plaintiffs filed two amended complaints, the State filed a motion to dismiss pursuant to Rules 12(b)(1), (2), and (6) of the North Carolina Rules of Civil Procedure as to all claims asserted by Plaintiffs except for their claim for declaratory judgment. A hearing was held on 19 November 2015, and the trial court entered an order on 3 December 2015 containing the following conclusions of law:

1. In July 2009, the General Assembly suspended pay increases under section 20-187.3 for the 2009-10 fiscal biennium. 2009 N.C. Sess. Laws 451, § 26.1A.(c). The Legislature did the same for the 2011-13 and 2013-15 biennia, 2011 N.C. Sess. Laws 145, § 29.8(b), 2013 N.C. Sess. Laws 360, § 35.8(d), but later revoked the suspension effective 1 July 2014, 2014 N.C. Sess. Laws 100, § 35.7.
2. The Legislature is free to alter a schedule of future salary benefits before the work supporting those benefits is actually performed. E.g. , N.C. Ass'n of Educators, Inc. v. State , 776 S.E.2d 1 (N.C. Ct. App.), pet. for disc. rev. allowed , 775 S.E.2d 831 (N.C. 2015) ; Whisnant v. Teachers' & State Employees Ret. Sys. , 191 N.C. App. 233, 236, 662 S.E.2d 573, 575 (2008), cert. denied , 555 U.S. 1174 (2009) ; Pritchard v. Elizabeth City , 81 N.C. App. 543, 552-53, 344 S.E.2d 821, 826, disc. review denied , 318 N.C. 417, 349 S.E.2d 598 (1986). As such, no contract for these future benefits is formed at the beginning of employment.
3. The Complaint fails to state a claim upon which relief can be granted on Plaintiffs' claims for breach of contract, impairment of contract, violations of Article I, Sections 18 and 19 of the North Carolina Constitution, specific performance and negligent misrepresentation.
4. The Defendants did not move to dismiss the claim for declaratory judgment. The declaratory judgment claim does not appear to raise any legal issues that are not addressed above.
5. Pursuant to Rule 54(b) of the North Carolina Rules of Civil Procedure, the Court finds that there is no just reason for delay of entry of final judgment as to Plaintiffs' claims regarding (1) breach of contract; (2) impairment of contract under Article I, Section 10 of the United States Constitution; (3) violations of Article I, Sections 18 and 19 of the North Carolina Constitution ; (4) specific performance; and (5) negligent misrepresentation.

Based on these conclusions, the trial court granted the State's motion to dismiss Plaintiffs' claims for breach of contract, impairment of contract under Article I, Section 10 of the United States Constitution, violations of Article I, Sections 18 and 19 of the North Carolina Constitution, negligent misrepresentation, and specific performance pursuant to Rule 12(b)(6)1 and stayed Plaintiffs' claim seeking a declaratory judgment. On 4 December 2015, Plaintiffs filed a notice of appeal to this Court. On 17 December 2015, the State filed a cross-appeal from the trial court's 18 August 2015 order allowing Plaintiffs' motion for class certification.

Analysis
I. Appellate Jurisdiction

As an initial matter, we note that the present appeal is interlocutory due to the fact that the trial court's order did not address Plaintiffs' claim for a declaratory judgment. "[W]hether an appeal is interlocutory presents a jurisdictional issue, and this Court has an obligation to address the issue sua sponte ." Duval v. OM Hospitality, LLC , 186 N.C. App. 390, 392, 651 S.E.2d 261, 263 (2007) (citation, quotation marks, and brackets omitted). "A final judgment is one which disposes of the cause as to all the parties, leaving nothing to be judicially determined between them in the trial court." Id. (citation omitted). Conversely, an order or judgment is interlocutory if it does not settle all of the issues in the case but rather "directs some further proceeding preliminary to the final decree." Heavner v. Heavner , 73 N.C. App. 331, 332, 326 S.E.2d 78, 80, disc. review denied , 313 N.C. 601, 330 S.E.2d 610 (1985).

"Generally, there is no right of immediate appeal from interlocutory orders and judgments." Paradigm Consultants, Ltd. v. Builders Mut. Ins. Co. , 228 N.C. App. 314, 317, 745 S.E.2d 69, 72 (2013) (citation and quotation marks omitted).

However, there are two avenues by which a party may immediately appeal an interlocutory order or judgment. First, if the order or judgment is final as to some but not all of the claims or parties, and the trial court certifies the case for appeal pursuant to N.C. Gen. Stat. § 1A-1, Rule 54(b), an immediate appeal will lie. Second, an appeal is permitted under N.C. Gen. Stat. §§ 1-277(a) and 7A-27(d)(1) if the trial court's decision deprives the appellant of a substantial right which would be lost absent immediate review.

N.C. Dep't of Transp. v. Page , 119 N.C. App. 730, 734, 460 S.E.2d 332, 334 (1995) (internal citations omitted).

Here, in its 3 December 2015 order, the trial court certified the order for immediate appeal pursuant to Rule 54(b). Therefore, we possess jurisdiction over Plaintiffs' appeal. See Feltman v. City of Wilson , 238 N.C. App. 246, 250...

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