Thompson Cadillac-Oldsmobile, Inc. v. Silk Hope Auto., Inc.

• Decision Date: 03 November 1987
• Docket Number: INC,No. 8610SC1318,CADILLAC-OLDSMOBIL,8610SC1318
• Citation: 87 N.C.App. 467,361 S.E.2d 418
• Parties: THOMPSONv. SILK HOPE AUTOMOBILE, INC., Clinton McLaurin, Howard C. McLaurin, Shelby C. McLaurin, D. Wayne Hood, d/b/a Hood's Used Cars, Columbus County Auto Auction, Inc., George Turner, R.E. Dowdy, William S. Hiatt.
• Court: North Carolina Court of Appeals

Page 418

361 S.E.2d 418

87 N.C.App. 467

THOMPSON CADILLAC-OLDSMOBILE, INC. v. SILK HOPE AUTOMOBILE, INC., Clinton McLaurin, Howard C.

McLaurin, Shelby C. McLaurin, D. Wayne Hood, d/b/a Hood's

Used Cars, Columbus County Auto Auction, Inc., George

Turner, R.E. Dowdy, William S. Hiatt.

No. 8610SC1318.

Court of Appeals of North Carolina.

Nov. 3, 1987.

Atty. Gen. Lacy H. Thornburg by Sp. Deputy Atty. Gen. Jane P. Gray and Asst. Atty. Gen. Victor H.E. Morgan, Jr., Raleigh, for defendants-appellees Hiatt and Dowdy.

Ragsdale and Kirschbaum by William L. Ragsdale, Raleigh, for plaintiff appellant-appellee.

Williamson & Walton by Benton H. Walton, III, and Carlton F. Williamson, Whiteville, for defendant appellant-appellee Columbus County Auto Auction, Inc.

COZORT, Judge.

On 13 March 1986 plaintiff, Thompson Cadillac-Oldsmobile, Inc., a retail automobile dealer, filed this action to recover damages incurred when the plaintiff had to reimburse customers who purchased automobiles from plaintiff when it was learned that the automobiles had been stolen and the vehicle identification numbers had been changed. Plaintiff sued Columbus County Auto Auction, Inc., (CCAA) the corporation who sold the stolen cars to plaintiff, and two business entities who were involved in transferring title of the stolen automobiles to CCAA. The claims against CCAA alleged negligence and breach of contract of warranty of title. Plaintiff also sued William S. Hiatt, the State Commissioner of Motor Vehicles, and R.E. Dowdy, an inspector in the Division of Motor Vehicles. Plaintiff alleged Hiatt was negligent in failing to adopt regulations for the inspection of vehicles and in failing to adequately supervise personnel. Plaintiff alleged Dowdy was negligent in failing to determine that the serial numbers of certain vehicles had been altered.

Defendants Hiatt and Dowdy filed a motion to dismiss on 11 April 1986, urging the trial court to dismiss the complaint against them pursuant to N.C.Gen.Stat. § 1A-1, Rules 12(b)(1), 12(b)(2) and 12(b)(6). On 13 August 1986 the trial court dismissed the action against defendants Hiatt and Dowdy, stating in the Order that it found a lack of jurisdiction over the subject matter of the complaint and over the person of these two defendants. Plaintiff timely appealed the order of dismissal.

On 11 June 1986 plaintiff filed a motion for summary judgment on the contract claim against CCAA. On 23 July 1986 CCAA filed a response and two affidavits opposing plaintiff's motion for summary judgment. On 13 August 1986, the trial court entered an order granting plaintiff's motion for summary judgment, ordering CCAA to pay plaintiff $175,450.00. Defendant CCAA timely appealed the order.

We affirm both orders.

We first address plaintiff's appeal of the trial court's order dismissing the action against defendants Hiatt and Dowdy. Plaintiff contends that the court erred because the complaint stated a cause of negligence against state employees individually; therefore, the plaintiff would not have to proceed against a state agency under the State Tort Claims Act. Defendants Hiatt and Dowdy contend that they are state officers, not state employees, and are thus not liable for mere negligence not arising to culpable and gross negligence, or reckless, arbitrary, willful, wanton and malicious acts. Our review of the complaint below and the applicable law leads us to the conclusion that Hiatt and Dowdy are state officers and that the trial court correctly dismissed the action.

"An employee of a governmental agency ... is personally liable for his negligence in the performance of his duties proximately causing injury to the property of another...." Givens v. Sellars, 273 N.C. 44, 49, 159 S.E.2d 530, 534-35 (1968) (citations omitted). "[A] 'public official' is immune from liability for 'mere negligence' in the performance of [his] duties, but he is not shielded from liability if his alleged actions were 'corrupt or malicious' or if 'he acted outside of and beyond the scope of his duties.' " Wiggins v. City of Monroe, 73 N.C.App. 44, 49, 326 S.E.2d 39, 43 (1985) (citations omitted). Plaintiff's allegations against defendants Hiatt and Dowdy allege nothing more than mere negligence. There are no allegations of corrupt or malicious actions, actions outside the scope of defendants' duties, or gross negligence. Thus, if defendants Hiatt and Dowdy are public officers or officials rather than employees, the complaint has failed to state a claim for which relief can be granted.

To constitute an office, as distinguished from employment, it is essential that the position must have been created by the constitution or statutes of the sovereignty....

An essential difference between a public office and mere employment is the fact that the duties of the incumbent of an office shall involve the exercise of some portion of the sovereign power.

State v. Hord, 264 N.C. 149, 155, 141 S.E.2d 241, 245 (1965) (citations omitted).

Defendant Hiatt was duly appointed by the Secretary of the Department of Transportation to administer the Division of Motor Vehicles, in accordance with N.C.Gen.Stat. § 20-2. Among the many duties assigned to the Commissioner are those set forth in N.C.Gen.Stat. § 20-39:

(a) The Commissioner is hereby vested with the power and is charged with the duty of administering and enforcing the provisions of this Article and of all laws regulating the operation of vehicles or the use of the highways, the enforcement or administration of which is now or hereafter vested in the Division.

(b) The Commissioner is hereby authorized to adopt and enforce such rules and regulations as may be necessary to carry out the provisions of this Article and any other laws the enforcement and administration of which are vested in the Division.

(c) The Commissioner is authorized to designate and appoint such agents, field deputies, and clerks as may be necessary to carry out the provisions of this Article.

There can be little doubt that Hiatt, as Commissioner of Motor Vehicles, exercises some portion of the sovereign power of the State. Accordingly, we find defendant Hiatt to be a public officer, and we hold that the complaint alleging mere negligence fails to state a claim against Hiatt upon which relief can be granted.

Defendant Dowdy is an inspector for the Division of Motor Vehicles, and his duties include the power:

(1) Of peace officers for the purpose of enforcing the provisions of this Article and of any other law regulating the operation of vehicles or the use of the highways.

(2) To make arrests upon view and without warrant for any violation committed in their presence of any of the provisions of this Article or other laws regulating the operation of vehicles or the use of the highways.

(3) At all time to direct all traffic in conformance with law, and in the event of a fire or other emergency or to expedite traffic or to insure safety, to direct traffic as conditions may require, notwithstanding the provisions of law.

(4) When on duty, upon reasonable belief that any vehicle is being operated in violation of any provision of this Article or of any other law regulating the operation of vehicles to require the driver thereof to stop and exhibit his driver's license and the registration card issued for the vehicle, and submit to an inspection of such vehicle, the registration plates and registration card thereon or to an inspection and test of the equipment of such vehicle.

(5) To inspect any vehicle of a type required to be registered hereunder in any public garage or repair shop or in any place where such vehicles are held for sale or wrecking, for the purpose of locating stolen vehicles and investigating the title...