{ "id": 8524484, "name": "JOHN A. THOMAS, JR. and wife, LAURA MAIE THOMAS, BETSY T. GALLIHER, and DEBORAH KERN THOMAS, Plaintiffs v. DONALD L. MILLER and wife, CRESSIE Y. MILLER, and RANDOLPH E. SHELTON, JR., Substitute Trustee, Defendants", "name_abbreviation": "Thomas v. Miller", "decision_date": "1992-03-03", "docket_number": "No. 9120SC60", "first_page": "589", "last_page": "594", "citations": [ { "type": "official", "cite": "105 N.C. App. 589" } ], "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": "394 S.E.2d 294", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 1990, "pin_cites": [ { "parenthetical": "award of attorneys' fees is error if party has not complied with \u00a7 6-21.2(5)" } ], "opinion_index": 0 }, { "cite": "99 N.C. App. 761", "category": "reporters:state", "reporter": "N.C. App.", "case_ids": [ 8525010 ], "year": 1990, "pin_cites": [ { "parenthetical": "award of attorneys' fees is error if party has not complied with \u00a7 6-21.2(5)" } ], "opinion_index": 0, "case_paths": [ "/nc-app/99/0761-01" ] }, { "cite": "389 S.E.2d 819", "category": "reporters:state_regional", "reporter": "S.E.2d", "weight": 2, "year": 1990, "opinion_index": 0 }, { "cite": "326 N.C. 366", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 5308673, 5304354, 5305838, 5307792, 5307378 ], "year": 1990, "opinion_index": 0, "case_paths": [ "/nc/326/0366-01", "/nc/326/0366-02", "/nc/326/0366-05", "/nc/326/0366-04", "/nc/326/0366-03" ] }, { "cite": "385 S.E.2d 545", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 1989, "pin_cites": [ { "page": "547" } ], "opinion_index": 0 }, { "cite": "96 N.C. App. 333", "category": "reporters:state", "reporter": "N.C. App.", "case_ids": [ 8521995 ], "year": 1989, "pin_cites": [ { "page": "335" } ], "opinion_index": 0, "case_paths": [ "/nc-app/96/0333-01" ] }, { "cite": "318 S.E.2d 560", "category": "reporters:state_regional", "reporter": "S.E.2d", "weight": 2, "year": 1984, "opinion_index": 0 }, { "cite": "70 N.C. App. 70", "category": "reporters:state", "reporter": "N.C. App.", "case_ids": [ 8520321 ], "weight": 2, "year": 1984, "opinion_index": 0, "case_paths": [ "/nc-app/70/0070-01" ] }, { "cite": "345 S.E.2d 391", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 1986, "opinion_index": 0 }, { "cite": "316 N.C. 733", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 4700482, 4698626, 4700563, 4703739, 4697309 ], "year": 1986, "opinion_index": 0, "case_paths": [ "/nc/316/0733-05", "/nc/316/0733-02", "/nc/316/0733-01", "/nc/316/0733-04", "/nc/316/0733-03" ] }, { "cite": "339 S.E.2d 452", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 1986, "opinion_index": 0 }, { "cite": "79 N.C. App. 425", "category": "reporters:state", "reporter": "N.C. App.", "case_ids": [ 8521187 ], "year": 1986, "opinion_index": 0, "case_paths": [ "/nc-app/79/0425-01" ] } ], "analysis": { "cardinality": 556, "char_count": 11706, "ocr_confidence": 0.746, "pagerank": { "raw": 2.551389424741628e-07, "percentile": 0.8143708378364917 }, "sha256": "8231f9214ef532839403925546356ba7a9fed4e24c8d76ff1bc4fbf0ff5e8313", "simhash": "1:395bcd34575fa066", "word_count": 1917 }, "last_updated": "2023-07-14T19:24:40.355340+00:00", "provenance": { "date_added": "2019-08-29", "source": "Harvard", "batch": "2018" }, "casebody": { "judges": [ "Judges WELLS and WALKER concur." ], "parties": [ "JOHN A. THOMAS, JR. and wife, LAURA MAIE THOMAS, BETSY T. GALLIHER, and DEBORAH KERN THOMAS, Plaintiffs v. DONALD L. MILLER and wife, CRESSIE Y. MILLER, and RANDOLPH E. SHELTON, JR., Substitute Trustee, Defendants" ], "opinions": [ { "text": "LEWIS, Judge.\nThis case poses several questions; namely, what effect does a voluntary dismissal without prejudice pursuant to N.C.G.S. \u00a7 1A-1, N.C.R. Civ. P. 41(a) (1990) have on a foreclosure action with respect to a promissory note\u2019s terms which provide for: (1) attorneys\u2019 fees and other reasonable expenses, and (2) with respect to the date of default when the noteholders institute a second foreclosure suit based upon the same note but a new default.\nOn 15 December 1984, plaintiffs purchased a home and surrounding real estate and executed a promissory note and a deed of trust in favor of defendants. Under the terms of these documents, the plaintiffs were required to pay the principal sum of $75,000.00 with twelve per cent interest during the first year. Thereafter, on each December 31st, the interest rate was to be adjusted to a rate one and one half percent \u201cbelow the prime rate at First Union National Bank, Rockingham, North Carolina.\u201d Further, the terms of the documents provide that upon default, the principal and accrued interest, if any, \u201cshall bear interest at the rate of twelve per cent per annum after default until paid.\u201d In addition, upon default the note entitled defendants to fifteen per cent of the outstanding balance owing on the note for \u201creasonable attorneys\u2019 fees,\u201d as well as any other \u201creasonable expenses incurred by the holder[s].\u201d\nOn 10 September 1987, defendants mailed to the plaintiffs a letter giving them notice that they were being held in default for what the defendants deemed were insufficient monthly payments. In this notice of default, defendants notified plaintiffs that if the remainder of the debt were not paid in full in fifteen days, defendants would invoke their right to collect attorneys\u2019 fees, pursuant to the terms of the promissory note. There was no mention of the defendants\u2019 intent to invoke the \u201cother reasonable expenses\u201d clause also contained in the note. On 9 March 1988 defendants gave plaintiffs a Notice of Hearing on Foreclosure. The Clerk of the Richmond County Superior Court, after a hearing on the matter on 31 March 1988, declined to authorize a foreclosure sale. After initially appealing this decision, the defendants subsequently took a voluntary dismissal without prejudice pursuant to Rule 41 of the North Carolina Rules of Civil Procedure, thereby terminating their action against plaintiffs.\nOn 19 July 1988, defendants filed a second Notice of Hearing on Foreclosure. Presumably, the precipitating factor in this second action was that the June 1988 payment check tendered by plaintiffs was returned for insufficient funds. The defendants in this second notice declared plaintiffs to be in default for the returned check and for the reasons enumerated in their first foreclosure suit. Significantly, the second notice was silent as to defendants\u2019 invoking either the promissory note\u2019s attorneys\u2019 fee clause or the clause for collection of other reasonable expenses.\nDefendants again lost at the Clerk\u2019s hearing, appealed, and on 6 February 1989 the Superior Court permitted the foreclosure. A dispute then arose over the correct interpretation of the term \u201cprime rate\u201d in conjunction with the proper amount of interest owed by plaintiffs. The plaintiffs then brought this suit for declaratory judgment. Plaintiffs sought and received a temporary restraining order enjoining the foreclosure sale pending the outcome of the declaratory judgment action.\nIn the order entered 11 September 1990 the trial court found: (1) that the prime rate is \u201cthat rate recognized as the \u2018prime rate\u2019 at First Union National Bank of Rockingham, North Carolina,\u201d (2) that the plaintiffs defaulted on the note on 1 September 1987, and (3) that defendants were entitled to both attorneys\u2019 fees and other reasonable expenses. Plaintiffs do not contest the holding on the prime rate, but appeal the remainder of the court\u2019s order. We reverse as to the attorneys\u2019 fees, affirm the court\u2019s award of other reasonable expenses incurred in the second foreclosure action, and dismiss as to date of default.\nPlaintiffs\u2019 first assignment of error concerns the lower court\u2019s award of reasonable attorneys\u2019 fees to defendants. To collect attorneys\u2019 fees, a party must comply with N.C.G.S. \u00a7 6-21.2(5) (1986) which says\n. . . the holder of a note and . . . other security agreement . . . shall, after maturity of the obligation by default or otherwise, notify the maker, debtor, account debtor, endorser or party sought to be held on said obligation that the provisions relative to payment of attorneys\u2019 fees in addition to the \u2018outstanding balance\u2019 shall be enforced and that such maker, debt- or, account debtor, endorser or party sought to be held on said obligation has five days from the mailing of such notice to pay the \u2018outstanding balance\u2019 without the attorneys\u2019 fees.\n(Emphasis added). The case law is clear that a party seeking to collect attorneys\u2019 fees incurred in the enforcement of a note must notify in writing the opposing party of this intent. Northwestern Bank v. Barber, 79 N.C. App. 425, 339 S.E.2d 452, disc. rev. denied, 316 N.C. 733, 345 S.E.2d 391 (1986); Blanton v. Sisk, 70 N.C. App. 70, 318 S.E.2d 560 (1984). While defendants claim their letter dated 10 September 1987 satisfies the notice requirement for both foreclosure actions, we find this notice to be insufficient for the second proceeding. The dispositive factor here is defendants\u2019 voluntary dismissal pursuant to N.C.G.S. \u00a7 1A-1, N.C.R. Civ. P. 41 (1990). Once a party files for and is granted a voluntary dismissal without prejudice, \u201cit [is] as if the suit had never been filed.\u201d Tompkins v. Log Sys. Inc., 96 N.C. App. 333, 335, 385 S.E.2d 545, 547 (1989), disc. rev. denied, 326 N.C. 366, 389 S.E.2d 819 (1990). If that party later refiles the same claim within the one year period as allowed in the Rule, the case is begun \u201canew for all purposes.\u201d Id.\nDefendants\u2019 voluntary dismissal without prejudice acted to terminate their initial foreclosure action. The 10 September 1987 notice defendants gave plaintiffs for collection of attorneys\u2019 fees did not survive the voluntary dismissal. If defendants wanted to collect reasonable attorneys\u2019 fees pursuant to the terms of the note, they would have had to provide plaintiffs with new notice as to that fact, in accordance with Blanton v. Sisk, 70 N.C. App. 70, 318 S.E.2d 560 (1984). See also Raleigh Fed. Sav. Bank v. Godwin, 99 N.C. App. 761, 394 S.E.2d 294 (1990) (award of attorneys\u2019 fees is error if party has not complied with \u00a7 6-21.2(5)). Even if the parties in the second suit were exactly those in the action dismissed, the fees would be calculated, if at all, on the basis of activity related to the second suit only.\nThe plaintiffs next assign as error the trial court\u2019s award of \u201cother reasonable expenses.\u201d Neither party directs us to case law which addresses this precise issue. We note that like the award of reasonable attorneys\u2019 fees, the promissory note expressly provides for the award of these expenses. However, N.C.G.S. \u00a7 6-21.2 applies only to attorneys\u2019 fees, interest, and finance charges, and so is inapplicable to these expenses. This provision, then, is simply a contract agreed to by the parties, and as such, the terms of the agreement control. Consequently, defendants\u2019 lack of notice to plaintiffs as to \u201cexpenses\u201d is not fatal.\nWe find ample evidence in the record to support the finding of fact and conclusion of law concerning \u201cother reasonable expenses.\u201d We find the award of defendants\u2019 travel expenses incurred in the enforcement of the note to be reasonable under the facts of this case, and therefore overrule this assignment of error.\nThe final assignment of error concerns the date of default as found by the trial court. The trial court found plaintiffs to be in default on the note as of 1 September 1987.\nThis Court finds a complete lack of evidence to support the finding of fact and conclusions of law holding that default occurred on 1 September 1987. The trial court gives no basis for this determination. This Court is unable to ascertain from the record why the trial court chose the seemingly random date of 1 September 1987, as we can find no default occurring on that date. Therefore, we find there is no basis for the trial court\u2019s holding as to this issue, and likewise no basis for applying the twelve per cent default interest rate as of 1 September 1987.\nHowever, we take note of the satisfaction of the debt which occurred on 30 October 1990. Defendants direct us to the promissory note as found in an appendix to the record. The note contains the following language: \u201cSATISFACTION: THE OUTSTANDING DEBT REPRESENTED BY THIS PROMISSORY NOTE HAS BEEN SATISFIED IN FULL. THIS THE 30TH DAY OF OCT., 1990.\u201d We find this language dispositive of plaintiffs\u2019 appeal on this issue. The plain language \u2014 \u201csatisfied in full\u201d \u2014 indicates to this Court a cancellation of the debt, including both principal and interest. We believe, therefore, that the matter of interest, twelve per cent or otherwise, is mooted. We dismiss the appeal of this issue.\nThe order of the trial court is therefore reversed as to attorney\u2019s fees, affirmed as to reasonable travel expenses, and dismissed as to date of default and interest arising therefrom.\nJudges WELLS and WALKER concur.", "type": "majority", "author": "LEWIS, Judge." } ], "attorneys": [ "Gill & Dow, by Douglas R. Gill, for plaintiffs-appellants.", "Van Camp, West, Webb & Hayes, P.A., by W. Carole Holloway, for defendants-appellees." ], "corrections": "", "head_matter": "JOHN A. THOMAS, JR. and wife, LAURA MAIE THOMAS, BETSY T. GALLIHER, and DEBORAH KERN THOMAS, Plaintiffs v. DONALD L. MILLER and wife, CRESSIE Y. MILLER, and RANDOLPH E. SHELTON, JR., Substitute Trustee, Defendants\nNo. 9120SC60\n(Filed 3 March 1992)\n1. Costs \u00a7 34 (NCI4th)\u2014 collection of attorney fees \u2014 voluntary dismissal \u2014 new notice required in second action\nThe 10 September 1987 notice defendants gave plaintiffs for collection of attorney fees did not survive the voluntary dismissal of their initial foreclosure action, and defendants were not entitled to recover attorney fees in their second foreclosure proceeding where they failed to notify plaintiffs in writing of their intention to seek attorney fees. N.C.G.S. \u00a7 6-21.2(5).\nAm Jur 2d, Costs \u00a7\u00a7 21, 72.\n2. Costs \u00a7 49 (NCI4th)\u2014 holders\u2019 right to other reasonable expenses \u2014effect of voluntary dismissal of first action \u2014 right not affected by failure to give written notice\nDefendants\u2019 right to \u201cother reasonable expenses\u201d incurred by them in the enforcement of a promissory note which provided for such expenses was not affected by defendants\u2019 failure to notify plaintiffs in writing of their intention to seek \u201cother expenses\u201d in their second foreclosure proceeding, since N.C.G.S. \u00a7 6-21.2 was inapplicable to this provision which was simply a contract agreed to by the parties. Therefore, the trial court properly awarded defendants reasonable travel expenses incurred in the enforcement of the note.\nAm Jur 2d, Costs \u00a7 21.\n3. Appeal and Error \u00a7 175 (NCI4th|\u2014 amount of interest \u2014 note satisfied \u2014 moot question\nThe matter of the date of default on a promissory note and the amount of interest awarded by the court in an 11 September 1990 order pursuant to a clause of the note providing that it would bear interest of twelve percent after default until paid was moot where the note contains a notation that it was \u201csatisfied in full\u201d on 30 October 1990, since the language \u201csatisfied in full\u201d indicates a cancellation of the entire debt, including both principal and interest.\nAm Jur 2d, Appeal and Error \u00a7\u00a7 761, 762.\nAPPEAL by plaintiffs from order entered 11 September 1990 by Judge William H. Helms in RICHMOND County Superior Court. Heard in the Court of Appeals 4 November 1991.\nGill & Dow, by Douglas R. Gill, for plaintiffs-appellants.\nVan Camp, West, Webb & Hayes, P.A., by W. Carole Holloway, for defendants-appellees." }, "file_name": "0589-01", "first_page_order": 617, "last_page_order": 622 }