{ "id": 8521985, "name": "BEAU RIVAGE PLANTATION, INC., Plaintiff v. MELEX USA, INC., Defendant and Third-Party Plaintiff v. EDDIE LEWIS, Third-Party Defendant", "name_abbreviation": "Beau Rivage Plantation, Inc. v. Melex USA, Inc.", "decision_date": "1993-11-02", "docket_number": "No. 925SC996", "first_page": "446", "last_page": "454", "citations": [ { "type": "official", "cite": "112 N.C. App. 446" } ], "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": "94 ALR3d 640", "category": "reporters:specialty", "reporter": "A.L.R. 3d", "opinion_index": -1 }, { "cite": "4 ALR4th 85", "category": "reporters:specialty", "reporter": "A.L.R. 4th", "opinion_index": -1 }, { "cite": "180 S.E.2d 823", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 1971, "pin_cites": [ { "parenthetical": "holding that the elements of a usury action include, inter alia, the presence of a loan and defining loan as \"the delivery by one party and the receipt by the other party of a given sum of money, on an agreement, express or implied, to repay the sum lent, with or without interest\"" } ], "opinion_index": 0 }, { "cite": "278 N.C. 523", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 8561041 ], "year": 1971, "opinion_index": 0, "case_paths": [ "/nc/278/0523-01" ] }, { "cite": "N.C. Gen. Stat. \u00a7 24-10.1", "category": "laws:leg_statute", "reporter": "N.C. Gen. Stat.", "opinion_index": 0 }, { "cite": "N.C. Gen. Stat. \u00a7 6-21.2", "category": "laws:leg_statute", "reporter": "N.C. Gen. Stat.", "weight": 3, "pin_cites": [ { "page": "(5)" }, { "page": "(5)" }, { "page": "(5)" } ], "opinion_index": 0 }, { "cite": "59 S.E.2d 429", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 1950, "opinion_index": 0 }, { "cite": "232 N.C. 744", "category": "reporters:state", "reporter": "N.C.", "year": 1950, "opinion_index": 0 }, { "cite": "57 S.E.2d 377", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 1950, "opinion_index": 0 }, { "cite": "231 N.C. 357", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 8629835 ], "year": 1950, "opinion_index": 0, "case_paths": [ "/nc/231/0357-01" ] }, { "cite": "251 S.E.2d 443", "category": "reporters:state_regional", "reporter": "S.E.2d", "weight": 2, "year": 1979, "opinion_index": 0 }, { "cite": "296 N.C. 486", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 8567731 ], "year": 1979, "opinion_index": 0, "case_paths": [ "/nc/296/0486-01" ] }, { "cite": "273 S.E.2d 247", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 1981, "opinion_index": 0 }, { "cite": "301 N.C. 561", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 8569785 ], "year": 1981, "opinion_index": 0, "case_paths": [ "/nc/301/0561-01" ] }, { "cite": "N.C. Gen. Stat. \u00a7 1-294", "category": "laws:leg_statute", "reporter": "N.C. Gen. Stat.", "opinion_index": 0 }, { "cite": "330 S.E.2d 219", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 1985, "opinion_index": 0 }, { "cite": "75 N.C. App. 127", "category": "reporters:state", "reporter": "N.C. App.", "case_ids": [ 8525118 ], "year": 1985, "opinion_index": 0, "case_paths": [ "/nc-app/75/0127-01" ] }, { "cite": "200 S.E.2d 622", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 1973, "opinion_index": 0 }, { "cite": "284 N.C. 407", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 8562175 ], "year": 1973, "opinion_index": 0, "case_paths": [ "/nc/284/0407-01" ] }, { "cite": "389 S.E.2d 293", "category": "reporters:state_regional", "reporter": "S.E.2d", "weight": 4, "year": 1990, "opinion_index": 0 }, { "cite": "97 N.C. App. 610", "category": "reporters:state", "reporter": "N.C. App.", "case_ids": [ 8522467 ], "year": 1990, "opinion_index": 0, "case_paths": [ "/nc-app/97/0610-01" ] }, { "cite": "N.C. Gen. Stat. \u00a7 25-2-315", "category": "laws:leg_statute", "reporter": "N.C. Gen. Stat.", "opinion_index": 0 }, { "cite": "308 S.E.2d 504", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 1983, "opinion_index": 0 }, { "cite": "65 N.C. App. 139", "category": "reporters:state", "reporter": "N.C. App.", "case_ids": [ 8522616 ], "year": 1983, "opinion_index": 0, "case_paths": [ "/nc-app/65/0139-01" ] } ], "analysis": { "cardinality": 710, "char_count": 17710, "ocr_confidence": 0.772, "pagerank": { "raw": 1.2428402033495245e-07, "percentile": 0.6083534213770764 }, "sha256": "63722e23ffa1f4a1ec6e0ef8ecc43f52088e5a294bc62fc75c36ee42c2c6ca1d", "simhash": "1:eb8e6e72b34f1946", "word_count": 2816 }, "last_updated": "2023-07-14T15:48:17.524906+00:00", "provenance": { "date_added": "2019-08-29", "source": "Harvard", "batch": "2018" }, "casebody": { "judges": [ "Judges LEWIS and MARTIN concur." ], "parties": [ "BEAU RIVAGE PLANTATION, INC., Plaintiff v. MELEX USA, INC., Defendant and Third-Party Plaintiff v. EDDIE LEWIS, Third-Party Defendant" ], "opinions": [ { "text": "WELLS, Judge.\nWhen a motion for summary judgment is granted, the questions for determination on appeal are whether, on the basis of the materials presented to the trial court, there is a genuine issue as to any material fact and whether the movant is entitled to judgment as a matter of law. Smith v. Smith, 65 N.C. App. 139, 308 S.E.2d 504 (1983).\nPlaintiff brings forth nine assignments of error. In the first assignment of error, plaintiff contends that the trial court erred in granting defendant\u2019s motion for summary judgment because there existed genuine issues of material fact regarding the nature of the agreement between the parties. We disagree.\nPlaintiff argues that the agreement, although denominated an \u201cEquipment Lease Agreement,\u201d is in reality a contract for the sale of goods because the agreement provided plaintiff with an option to purchase the golf carts for their fair market value or 10 percent of the original sales price, thereby making applicable the implied warranty of fitness for a particular purpose contained in Article 2 of the Uniform Commercial Code. The implied warranty of fitness for a particular purpose provides:\nWhere the seller at the time of contracting has reason to know any particular purpose for which the goods are required and that the buyer is relying on the seller\u2019s skill or judgment to select or furnish suitable goods, there is unless excluded or modified ... an implied warranty that the goods shall be fit for such purpose.\nN.C. Gen. Stat. \u00a7 25-2-315.\nThe presence of a purchase option does not per se make the agreement a contract for the sale of goods. Alpiser v. Eagle Pontiac-GMC-Isuzu, 97 N.C. App. 610, 389 S.E.2d 293 (1990). \u201cThe \u2018best test\u2019 to determine the agreement\u2019s purpose and the parties\u2019 intent is a \u2018comparison of the option price with the market value of the equipment at the time the option is exercised.\u2019 \u201d Id. If the lessee can acquire the property under the option for little or no additional consideration, then the lease would be a disguised security agreement for the sale of goods. Id.\nIn the instant case, the agreement between the parties is designated a lease on its face and is for a fixed term of 48 months. The agreement provides the lessee with the option to purchase the golf carts for their fair market value or 10 percent of the original sales price, whichever is less. This purchase option indicates that the parties intended to engage in a true lease, not a disguised sale because the option price is the equipment\u2019s fair market value. Id. Furthermore, the forecast of the evidence discloses that the purchase option, calculated as 10 percent of the original sales price, was intended to approximate the depreciated fair market value of the golf carts. The agreement is therefore a true lease, making Article 2 of the Uniform Commercial Code inapplicable.\nPlaintiff also argues that the trial court erred in granting defendant\u2019s motion for summary judgment because the terms of the lease are ambiguous and there are genuine issues of material fact regarding defendant\u2019s performance of its warranty obligations. We disagree.\nIn August 1988, plaintiff and defendant signed a \u201cGolf Car Proposal\u201d which included the terms previously described. The \u201cEquipment Lease Agreement,\u201d signed by the parties prior to delivery of the golf carts, disclaimed all warranties. The \u201cEquipment Lease Agreement\u201d stated: \u201cLessor makes no warranty with respect to the equipment, express or implied, and lessor specifically disclaims any warranty of merchantability and of fitness for a particular purpose.\u201d The \u201cEquipment Lease Agreement\u201d also provided: \u201cFor other terms & conditions of this lease, see attached Golf Car Proposal.\u201d\nThe primary purpose of a court called upon to interpret a contract is to ascertain the intention of the parties, and the intention of the parties is a question of law. Lane v. Scarborough, 284 N.C. 407, 200 S.E.2d 622 (1973). When a second contract involves the same subject matter as the first contract, and no rescission has occurred, the contracts must be construed together. In re Foreclosure of Fortescue, 75 N.C. App. 127, 330 S.E.2d 219 (1985).\nWhen the \u201cEquipment Lease Agreement\u201d and the \u201cGolf Car Proposal\u201d are read together, the terms of the agreement are not ambiguous, and the trial court properly determined that the agreement between the parties contained, by integration, the \u201cEquipment Lease Agreement\u201d and the \u201cGolf Car Proposal.\u201d\nThe forecast of the evidence reflects that when plaintiff informed defendant of problems with the golf carts, defendant made periodic visits to make repairs on the carts. The forecast of the evidence supports the trial court\u2019s finding that there were no genuine issues of material fact regarding defendant\u2019s performance of its warranty obligations. Accordingly, we find no merit in plaintiff\u2019s first argument.\nIn assignments of error numbers 4, 5, and 8, plaintiff argues that the trial court lacked jurisdiction to hear motions for prejudgment interest, late charges, and attorney\u2019s fees because plaintiff filed notice of appeal after the trial court granted defendant\u2019s motion for summary judgment and before the trial court awarded defendant pre-judgment interest, late charges, and attorney\u2019s fees.\nThe trial court\u2019s order, entered 27 July 1992, granting defendant\u2019s motion for summary judgment ordered that:\n2) Melex be, and hereby is, granted summary judgment against Beau Rivage on Melex\u2019s counterclaim in the principal amount of $74,793.00, plus late fees and prejudgment interest as provided by the lease;\n4) Melex be, and hereby is, awarded reasonable attorney\u2019s fees pursuant to G.S. 6-21.2 and the Lease Agreement. However, the Court reserves ruling on the amount of such fees until supporting affidavits are filed and a further hearing is conducted;\nOn 31 July 1992, defendant filed its motion for taxation of attorney\u2019s fees, costs, pre-judgment interest and other relief. On 12 August 1992, plaintiff filed its notice of appeal to this Court. On 27 August 1992, the trial court ordered plaintiff to pay defendant late fees, pre-judgment interest, and attorney\u2019s fees.\nIn support of its position, plaintiff cites and relies upon N.C. Gen. Stat. \u00a7 1-294 and the opinion of our Supreme Court in Lowder v. Mills, Inc., 301 N.C. 561, 273 S.E.2d 247 (1981). Section 1-294 provides in pertinent part:\nWhen an appeal is perfected as provided by this Article it stays all further proceedings in the court below upon the judgment appealed from, or upon the matter embraced therein; but the court below may proceed upon any other matter included in the action and not affected by the judgment appealed from.\nWhile a literal reading of \u00a7 1-294, considered alone, would appear to support plaintiff\u2019s position, it is obvious that the threshold and dispositive question is whether the trial court\u2019s order of 27 July had the requisite finality to make it subject to immediate appeal. We are of the opinion that it did not.\nWe find guidance from our Supreme Court\u2019s opinion in Industries, Inc. v. Insurance Co., 296 N.C. 486, 251 S.E.2d 443 (1979). In Industries, Inc., the appellant attempted to appeal a trial court judgment which determined the issue of liability but left for further determination \u201cthe amount of damages suffered by plaintiff by reason of reasonable attorneys\u2019 fees, costs, expenses, and judgment and settlement amounts incurred and paid by plaintiff as a result of [plaintiff\u2019s] claims for damages.\u201d The Court discussed at length the provisions and implications of Rule 54(a) of the Rules of Civil Procedure and prior case law bearing on the finality of judgments in the context of their appealability and held that the judgment in that case was interlocutory and not appropriate for immediate appeal. The analogy between the case now before us and the case considered in Industries, Inc. is striking. We conclude that Industries, Inc. controls our disposition and hold that the trial court\u2019s order of 27 July was interlocutory and not subject to immediate appeal. Although the Court in Industries, Inc. dismissed the appeal as interlocutory, this case is different because plaintiff appeals from the whole judgment whereas in Industries, Inc. defendant appealed from partial summary judgment. We treat plaintiff\u2019s appeal from the trial court\u2019s order of 27 July as an exception to the granting of summary judgment which preserved plaintiff\u2019s right to appeal once the final order was entered. It follows, therefore, that plaintiff could not oust the trial court\u2019s jurisdiction to \u201csettle and determine the entire controversy\u201d by filing its notice of appeal to the 27 July order. Id. (quoting Veazey v. Durham, 231 N.C. 357, 57 S.E.2d 377, reh\u2019g denied, 232 N.C. 744, 59 S.E.2d 429 (1950)). Accordingly, we overrule these assignments of error.\nIn assignment of error number 10, plaintiff argues that because defendant failed to provide the notice required by N.C. Gen. Stat. \u00a7 6-21.2(5), defendant is not entitled to recover attorney\u2019s fees.\nIn order to recover attorney\u2019s fees pursuant to N.C. Gen. Stat. \u00a7 6-21.2(5), defendant was required to give plaintiff notice that it had five days to pay the outstanding balance owed without the attorney\u2019s fees and that if plaintiff paid the outstanding balance in full before the expiration of such time, then the obligation to pay the attorney\u2019s fees would be terminated.\nThe forecast of the evidence reflects that defendant did notify plaintiff by certified mail on 21 March 1991 of defendant\u2019s default of the lease agreement. The certified letter provided, in pertinent part:\nThis is a final notice. Unless you comply with the Equipment Lease Agreement No. 527, its all [sic] terms and conditions, and specifically, by effectuating the past due payment of .$4,320.00 and providing full and adequate storage and technical maintenance of the equipment within seven (7) days from the date of Notice of Default, we shall exercise our rights pursuant to paragraph 19 \u201cRemedies\u201d of the Lease ....\nParagraph 19 of the \u201cEquipment Lease Agreement\u201d provided that defendant, in the event of default, was entitled to recover prejudgment interest and attorney\u2019s fees. Clearly, this letter provided plaintiff with the notice required under N.C. Gen. Stat. \u00a7 6-21.2(5).\nIn assignments of error 6 and 7, plaintiff argues that the late charges recoverable under the provisions of the \u201cEquipment Lease Agreement\u201d are usurious interest prohibited by N.C. Gen. Stat. \u00a7 24-10.1. As the forecast of the evidence discloses that this transaction involved a lease, not a loan, the provisions of Chapter 24 are inapplicable, and plaintiff\u2019s assignments of error are overruled. Kessing v. Mortgage Corp., 278 N.C. 523, 180 S.E.2d 823 (1971) (holding that the elements of a usury action include, inter alia, the presence of a loan and defining loan as \u201cthe delivery by one party and the receipt by the other party of a given sum of money, on an agreement, express or implied, to repay the sum lent, with or without interest\u201d).\nThe orders of the trial court granting defendant\u2019s motion for summary judgment and ordering payment of attorney\u2019s fees, prejudgment interest, and late charges are\nAffirmed.\nJudges LEWIS and MARTIN concur.", "type": "majority", "author": "WELLS, Judge." } ], "attorneys": [ "Marshall, Williams & Gorham, hy Lonnie B. Williams, for plaintiff and third-party defendant-appellants.", "Armstrong & Armstrong, P.A., by L. Lamar Armstrong, Jr., for defendant and third-party plaintiff-appellees." ], "corrections": "", "head_matter": "BEAU RIVAGE PLANTATION, INC., Plaintiff v. MELEX USA, INC., Defendant and Third-Party Plaintiff v. EDDIE LEWIS, Third-Party Defendant\nNo. 925SC996\n(Filed 2 November 1993)\n1. Uniform Commercial Code \u00a7 12 (NCI3d)\u2014 transaction as lease and not sales agreement \u2014 Uniform Commercial Code Art. 2 inapplicable\nThe agreement between the parties was a true lease of golf carts and not a disguised security agreement for the sale of goods, thus making implied warranty of fitness provisions of Article 2 of the Uniform Commercial Code inapplicable, where the agreement was designated a lease on its face and was for a fixed term of 48 months; the agreement provided the lessee with the option to purchase the golf carts at the end of the lease for their fair market value or 10% of the original sale price, whichever was less; and the purchase option was intended to approximate the depreciated fair market value of the golf carts. N.C.G.S. \u00a7 25-2-315.\nAm Jur 2d, Sales \u00a7 37.\nWhat constitutes a transaction, a contract for sale, or a sale within the scope of UCC Article 2. 4 ALR4th 85.\n2. Sales \u00a7 81 (NCI4th)\u2014 lease of golf carts \u2014integrated agreement \u2014performance of warranties\nThe trial court properly determined that the agreement between the parties for the lease of golf carts contained, by integration, the \u201cGolf Car Proposal\u201d and the \u201cEquipment Lease Agreement,\u201d and there was no genuine issue of material fact regarding defendant\u2019s performance of its warranty obligations where the forecast of evidence showed that defendant made periodic visits to repair the carts when informed by defendant of problems with the carts, and that the Equipment Lease Agreement disclaimed all warranties, including any warranties of merchantability and fitness.\nAm Jur 2d, Sales \u00a7 840.\n3. Appeal and Error \u00a7 178 (NCI4th)\u2014 summary judgment\u2014 notice of appeal \u2014 subsequent order awarding prejudgment interest, late fees, and attorney\u2019s fees\nThe trial court did not lack jurisdiction to hear motions for pre-judgment interest, late charges, and attorney\u2019s fees because plaintiff filed notice of appeal after the trial court granted defendant\u2019s motion for summary judgment on its counterclaim on 27 July and before the trial court awarded defendant pre-judgment interest, late charges, and attorney\u2019s fees on 27 August, since the trial court\u2019s order of 27 July was interlocutory and not subject to immediate appeal. Plaintiff\u2019s appeal from the 27 July order is treated as an exception to the granting of summary judgment which preserved plaintiff\u2019s right to appeal once the final order was entered, and plaintiff therefore could not oust the trial court\u2019s jurisdiction to settle and determine the entire controversy by filing its notice of appeal to the 27 July order.\nAm Jur 2d, Appeal and Error \u00a7 352 et seq.\n4. Costs \u00a7 34 (NCI4th)\u2014 attorney\u2019s fees \u2014 sufficiency of notice for recovery\nPlaintiff lessee was given sufficient notice required by N.C.G.S. \u00a7 6-21.2(5) to entitle defendant lessor to recover attorney\u2019s fees where the lessor\u2019s notice of default, sent to the lessee by certified mail, stated the lessor\u2019s intention to exercise its paragraph 19 remedies under the lease, and paragraph 19 provides for the recovery of attorney\u2019s fees.\nAm Jur 2d, Costs \u00a7\u00a7 72-86.\n5. Usury \u00a7 1.1 (NCI3d)\u2014 late charges recoverable under lease \u2014 usury statutes inapplicable\nPlaintiff could not prevail on its argument that late charges recoverable under the provisions of the parties\u2019 \u201cEquipment Lease Agreement\u201d were usurious interest prohibited by N.C.G.S. \u00a7 24-10.1, since the parties\u2019 transaction involved a lease, not a loan, and the provisions of Chapter 24 were therefore inapplicable.\nAm Jur 2d, Interest and Usury \u00a7\u00a7 112, 115.\nApplication of usury laws to transactions characterized as \u201cleases\u201d. 94 ALR3d 640.\nAppeal by plaintiff and third-party defendant from an order granting defendant\u2019s motion for summary judgment entered 27 July 1992 in New Hanover County Superior Court by Judge James D. Llewellyn. Plaintiff and third-party defendant also appeal from an order granting defendant\u2019s motion for late fees, pre-judgment interest, and attorney\u2019s fees entered 27 August 1992 in New Hanover County Superior Court by Judge G.K. Butterfield, Jr. Heard in the Court of Appeals 16 September 1993.\nIn August 1988, plaintiff and defendant signed a \u201cGolf Car Proposal\u201d which provided that defendant would lease to plaintiff 60 golf carts with battery chargers for 48 months. The \u201cGolf Car Proposal\u201d contained a two-year warranty on parts excluding batteries, chargers, tires, and tops, and a three-year warranty on motors and drivetrains. Plaintiff elected not to purchase a maintenance contract which would have provided bumper-to-bumper service and repair for all the golf carts. Before defendant delivered the golf carts, defendant mailed its standard lease agreement to plaintiff. The agreement disclaimed all warranties and provided that, in case of default by the lessee, the defendant could recover interest on the unpaid balance, legal fees, and late charges. The owner and manager of Beau Rivage, the third-party defendant, signed the agreement without reading it.\nIn November 1988, plaintiff began experiencing problems with the golf carts. The carts would not complete eighteen holes, and battery recharging required twice as long as anticipated. Defendant attempted to remedy the problems and made several visits to the golf course to make repairs. Despite these efforts, the problems continued. Plaintiff entered into a lease with another company and notified defendant on 19 February 1991 of its intent to terminate the agreement.\nOn 1 April 1991, plaintiff commenced this suit alleging breach of express and implied warranties. Defendant counterclaimed for the remaining lease payments, interest, late charges, and attorney\u2019s fees. Following a hearing, on 27 July 1992, Judge Llewellyn entered summary judgment for defendant, dismissing plaintiffs claim and allowing recovery by defendant on its counterclaim and reserving for later determination defendant\u2019s claim for pre-judgment interest, late fees, and attorney\u2019s fees. On 27 August 1992, Judge Butterfield entered his order awarding recovery of those damages to defendant. Plaintiff and third-party defendant have appealed from both orders.\nMarshall, Williams & Gorham, hy Lonnie B. Williams, for plaintiff and third-party defendant-appellants.\nArmstrong & Armstrong, P.A., by L. Lamar Armstrong, Jr., for defendant and third-party plaintiff-appellees." }, "file_name": "0446-01", "first_page_order": 476, "last_page_order": 484 }