{ "id": 8527550, "name": "CLYDE PENLEY v. BETTY ROBERTS PENLEY and HAMBURG VALLEY, INC.", "name_abbreviation": "Penley v. Penley", "decision_date": "1990-12-18", "docket_number": "No. 9028SC62", "first_page": "225", "last_page": "227", "citations": [ { "type": "official", "cite": "101 N.C. App. 225" } ], "court": { "name_abbreviation": "N.C. Ct. App.", "id": 14983, "name": "North Carolina Court of Appeals" }, "jurisdiction": { "id": 5, "name_long": "North Carolina", "name": "N.C." }, "cites_to": [ { "cite": "258 S.E.2d 864", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 1979, "opinion_index": 0 }, { "cite": "43 N.C. App. 269", "category": "reporters:state", "reporter": "N.C. App.", "case_ids": [ 8551174 ], "year": 1979, "opinion_index": 0, "case_paths": [ "/nc-app/43/0269-01" ] }, { "cite": "393 S.E.2d 827", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 1990, "opinion_index": 0 }, { "cite": "327 N.C. 234", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 2495079 ], "year": 1990, "opinion_index": 0, "case_paths": [ "/nc/327/0234-01" ] }, { "cite": "332 S.E.2d 51", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 1985, "opinion_index": 0 }, { "cite": "314 N.C. 1", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 4696910 ], "year": 1985, "opinion_index": 0, "case_paths": [ "/nc/314/0001-01" ] } ], "analysis": { "cardinality": 372, "char_count": 5564, "ocr_confidence": 0.773, "pagerank": { "raw": 2.0446031217563963e-07, "percentile": 0.7505808253685833 }, "sha256": "1586863ccbdeb0866b30ddf65ae5fa17de388a1083e074864881c9d020ab37f5", "simhash": "1:d51a7664ca3da0e4", "word_count": 871 }, "last_updated": "2023-07-14T19:54:53.681770+00:00", "provenance": { "date_added": "2019-08-29", "source": "Harvard", "batch": "2018" }, "casebody": { "judges": [ "Judges Johnson and Parker concur." ], "parties": [ "CLYDE PENLEY v. BETTY ROBERTS PENLEY and HAMBURG VALLEY, INC." ], "opinions": [ { "text": "PHILLIPS, Judge.\nIn 1978 plaintiff and the individual defendant, then husband and wife, formed defendant corporation primarily to operate a Kentucky Fried Chicken restaurant business that defendant Betty Roberts Penley owned a franchise for and had operated for about ten years. In 1979 they separated. In 1981 plaintiff brought this action, inter alia, to establish his stock interest in the corporation, to prevent the individual defendant from mismanaging the business, to recover corporate assets she had allegedly converted, and to liquidate the corporation. The stock ownership claim was determined by a 1982 trial, eventually upheld by our Supreme Court, in which it was adjudged that plaintiff owned 48% of the stock in defendant corporation, the individual defendant owned 48%, and their son the remaining 4%. Penley v. Penley, 314 N.C. 1, 332 S.E.2d 51 (1985).\nDuring the several years that plaintiff\u2019s other claims remained in the trial court the parties disagreed about many matters, most of which were of little or no consequence either to the case or the appeal, but they eventually agreed upon two things material to both. First, in 1981 they agreed that a receiver for the defendant corporation would be appointed and for the rest of its existence the company was operated under orders of the court; and in 1985, after the receiver\u2019s management of the company did not satisfy plaintiff they agreed, pursuant to plaintiff\u2019s motion and defendant\u2019s countermotion, to liquidate the corporation. In due course the appointed receiver sold the company\u2019s property, paid its debts, distributed the remaining proceeds to the stockholders, and was discharged. While the company was being liquidated defendant Betty Penley, who never ceased to own the first Kentucky Fried Chicken franchise she received, obtained a new franchise and started another Kentucky Fried Chicken business in Hendersonville. In his amended complaint plaintiff claimed that the new franchise was obtained by company funds that the individual defendant converted and that obtaining the franchise for herself violated her fiduciary duties to the corporation. When those claims were tried in September, 1989 they were dismissed by a directed verdict at the end of plaintiff\u2019s evidence. The judgment appealed from is affirmed.\nPlaintiff presented no evidence that defendant converted or misappropriated any of the corporation\u2019s funds or property and nothing in the record indicates that she had a duty to turn her newly obtained Kentucky Fried Chicken franchise over to defendant corporation, then in the throes of liquidation. Indeed, plaintiff\u2019s witness, Andrew Stull, an accountant who investigated the corporation\u2019s affairs at the request of the receiver, testified that he found no evidence of any improprieties or misappropriations by her; and while Harvey Jenkins, the accountant who prepared the corporate tax returns, testified that the company gave defendant various checks, he testified in explanation that defendant often loaned the company money and the checks were in payment of those debts. And the claim that while the corporation was being put out of business at plaintiff\u2019s insistence the individual defendant had a duty to promote its future profit by turning the new franchise over to it is supported by no principle of law or equity of which we are aware. Furthermore, the uncontradicted evidence also shows that the franchise could not be conveyed to the corporation since its terms prohibited it from being assigned to a corporation in which the individual defendant had less than a 51% interest.\nAll of plaintiff\u2019s other contentions concern matters set at rest long before the judgment appealed from was entered. None of the actions or orders now complained of was appealed or even excepted to until years later when this appeal was being perfected. One contention concerns the trial court\u2019s proper refusal to act upon the adjudication that plaintiff owned 48% of the corporate stock while that adjudication was being contested on appeal. See Kirby Building Systems, Inc. v. McNiel, 327 N.C. 234, 393 S.E.2d 827 (1990). The others concern the receiver who was discharged in October, 1987 by an order stating that there was \u201cno objection to the accounting presented by the receiver\u201d; an order that plaintiff opposed only by filing a broadside objection six days later. Rule 3(d), N.C. Rules of Appellate Procedure; Smith v. Independent Life Insurance Co., 43 N.C. App. 269, 258 S.E.2d 864 (1979).\nAffirmed.\nJudges Johnson and Parker concur.", "type": "majority", "author": "PHILLIPS, Judge." } ], "attorneys": [ "Carter & Kropelnicki, P.A., by Steven Kropelnicki, Jr., for plaintiff appellant.", "Van Winkle, Buck, Wall, Starnes and Davis, P.A., by Michelle Rippon and Robert H. Haggard, for defendant appellees." ], "corrections": "", "head_matter": "CLYDE PENLEY v. BETTY ROBERTS PENLEY and HAMBURG VALLEY, INC.\nNo. 9028SC62\n(Filed 18 December 1990)\nCorporations \u00a7 12 (NCI3d)\u2014 misappropriation of corporate assets and opportunities \u2014insufficient evidence\nPlaintiff\u2019s evidence was insufficient to show that the individual defendant converted or misappropriated any of the funds or other property of a corporation formed by the parties to operate a fried chicken restaurant. Furthermore, the individual defendant was under no duty to turn over to the corporation a new fried chicken franchise which she obtained while the corporation was in the process of liquidation.\nAm Jur 2d, Corporations \u00a7\u00a7 104, 107, 143.\nAppeal by plaintiff from judgment entered 14 September 1989 by Judge Forrest A. Ferrell in BUNCOMBE County Superior Court. Heard in the Court of Appeals 28 August 1990.\nCarter & Kropelnicki, P.A., by Steven Kropelnicki, Jr., for plaintiff appellant.\nVan Winkle, Buck, Wall, Starnes and Davis, P.A., by Michelle Rippon and Robert H. Haggard, for defendant appellees." }, "file_name": "0225-01", "first_page_order": 253, "last_page_order": 255 }