{ "id": 11920371, "name": "FRANCIS J. McGAHREN and wife, JOHANNA F. McGAHREN v. GEORGE W. SAENGER", "name_abbreviation": "McGahren v. Saenger", "decision_date": "1995-05-02", "docket_number": "No. 9428SC537", "first_page": "649", "last_page": "654", "citations": [ { "type": "official", "cite": "118 N.C. App. 649" } ], "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": "2 ALR4th 284", "category": "reporters:specialty", "reporter": "A.L.R. 4th", "opinion_index": -1 }, { "cite": "209 S.E.2d 494", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 1974, "pin_cites": [ { "page": "500" } ], "opinion_index": 0 }, { "cite": "286 N.C. 130", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 8563771 ], "year": 1974, "pin_cites": [ { "page": "138" } ], "opinion_index": 0, "case_paths": [ "/nc/286/0130-01" ] }, { "cite": "322 S.E.2d 777", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 1984, "opinion_index": 0 }, { "cite": "312 N.C. 488", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 4749344 ], "year": 1984, "opinion_index": 0, "case_paths": [ "/nc/312/0488-01" ] }, { "cite": "317 S.E.2d 692", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 1984, "pin_cites": [ { "page": "697" } ], "opinion_index": 0 }, { "cite": "69 N.C. App. 355", "category": "reporters:state", "reporter": "N.C. App.", "case_ids": [ 8526301 ], "year": 1984, "pin_cites": [ { "page": "362" } ], "opinion_index": 0, "case_paths": [ "/nc-app/69/0355-01" ] }, { "cite": "447 S.E.2d 784", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 1994, "pin_cites": [ { "page": "787", "parenthetical": "defendant attorney's last act giving rise to cause of action occurred when he supervised execution of will he had negligently drafted" } ], "opinion_index": 0 }, { "cite": "337 N.C. 651", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 2551919 ], "year": 1994, "pin_cites": [ { "page": "654", "parenthetical": "defendant attorney's last act giving rise to cause of action occurred when he supervised execution of will he had negligently drafted" } ], "opinion_index": 0, "case_paths": [ "/nc/337/0651-01" ] }, { "cite": "456 S.E.2d 771", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 1995, "opinion_index": 0 }, { "cite": "339 N.C. 730", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 2556119 ], "year": 1995, "opinion_index": 0, "case_paths": [ "/nc/339/0730-01" ] }, { "cite": "439 S.E.2d 792", "category": "reporters:state_regional", "reporter": "S.E.2d", "weight": 3, "year": 1994, "pin_cites": [ { "page": "794" }, { "page": "795" }, { "page": "797" } ], "opinion_index": 0 }, { "cite": "113 N.C. App. 589", "category": "reporters:state", "reporter": "N.C. App.", "case_ids": [ 8523783 ], "weight": 2, "year": 1994, "pin_cites": [ { "page": "593" }, { "page": "597" } ], "opinion_index": 0, "case_paths": [ "/nc-app/113/0589-01" ] } ], "analysis": { "cardinality": 592, "char_count": 11912, "ocr_confidence": 0.73, "pagerank": { "raw": 3.031359392422889e-07, "percentile": 0.854636698896345 }, "sha256": "c087205a2a9be27d6c2d5f056af6064bb4e2cd326b01e1957d1c91354e6415d5", "simhash": "1:aed114ea974eb233", "word_count": 1960 }, "last_updated": "2023-07-14T20:04:31.897721+00:00", "provenance": { "date_added": "2019-08-29", "source": "Harvard", "batch": "2018" }, "casebody": { "judges": [ "Judges WYNN and McGEE concur." ], "parties": [ "FRANCIS J. McGAHREN and wife, JOHANNA F. McGAHREN v. GEORGE W. SAENGER" ], "opinions": [ { "text": "LEWIS, Judge.\nPlaintiffs commenced this action pro se to recover damages for alleged legal malpractice and fraud. The trial court granted defendant\u2019s motion for summary judgment on the ground that the action was barred by the statute of limitations, N.C.G.S. \u00a7 l-15(c) (1983). From the entry of summary judgment, plaintiffs appeal.\nThe facts, when viewed in the light most favorable to plaintiffs, show that in May 1984 plaintiff Francis McGahren (hereinafter \u201cMcGahren\u201d) and C. Walter Weiss formed W & M Investment Company, a partnership, to develop commercial real estate. Defendant was hired to perform various legal services for the partnership. In 1985 the partnership dissolved, and the partners instructed defendant to prepare a deed transferring title to all the property in a subdivision known as Ridgedale from the partnership to McGahren. Defendant prepared the deed but failed to include Lot 3. McGahren recorded the deed on 25 June 1985. As of that time, Lot 3 remained subject to a deed of trust, which was guaranteed by plaintiffs and Mr. and Mrs. Weiss.\nOn 1 July 1987, the Weisses filed a Chapter 7 bankruptcy petition. Plaintiffs did not learn about the omission of Lot 3 from the deed until 1989, after they entered into a contract to sell the lot to Barbara and Royce Sluder. The Sluder\u2019s attorney, James Baley, performed a title search in December 1989 and informed McGahren that title to the land was still in the name of W & M Investment Company. On 3 January 1990, McGahren called defendant and informed him of the problem with the deed. Defendant told McGahren that he did not know anything about Lot 3 or the partnership\u2019s intentions with respect to the lot. McGahren also called the bankruptcy trustee to inform her of the problem. The trustee told McGahren that she would have to be paid from the proceeds of the sale of the property. On 12 January, McGahren wrote defendant, demanding that defendant correct the problem with the title.\nThe contract with the Sluders expired on 9 January and no action was taken to extend it. In mid January, McGahren asked Baley, the Sluder\u2019s attorney, to represent him in clearing up the problem with the title. In February, Baley informed McGahren that defendant had obtained a deed to Lot 3 from Weiss, McGahren\u2019s former partner, and that defendant wanted McGahren to release defendant from liability in exchange for the deed. Baley instructed McGahren to come to his office to sign the release and to pick up the deed, and Baley informed McGahren that the bankruptcy trustee would, according to McGahren, \u201cclear the problem with the Bankruptcy court after [McGahren] had gotten the deed.\u201d Baley also told McGahren about a mutual release with the Sluders that reflected the expiration of the sale contract.\nPlaintiffs went to Baley\u2019s office on 2 March to pick up the deed and to sign the releases. Baley told plaintiffs that the deed was not yet available, but that they should sign and postdate the release of defendant and that Baley would hold the release until defendant delivered the deed. Plaintiffs also signed a release with the Sluders. On 23 March, McGahren picked up the deed from Baley\u2019s office. McGahren then delivered a copy of the deed to the bankruptcy trustee\u2019s office. On 30 March, McGahren recorded the deed with the Buncombe County Register of Deeds.\nIn March 1991, plaintiff became aware that the 1990 deed to Lot 3 conveyed no interest in the property because of the Weiss\u2019s bankruptcy. On 28 August 1991, McGahren wrote the bankruptcy trustee and informed her that he was turning over the property to her. On 30 August, defendant, who had received a copy of that letter, wrote McGahren, informing him that Lot 3 was McGahren\u2019s property and that the trustee agreed. From the date McGahren turned over the property to the trustee, McGahren ceased making mortgage payments on the property. The debt subsequently went into default.\nOn 18 March 1992, the property was abandoned by the bankruptcy trustee. Thereafter, First Citizens Bank reported the default to the Asheville Credit Bureau. McGahren contends that, as a result, he was unable to secure a credit line essential to his new business, and he suffered substantial losses. Plaintiffs filed suit against defendant in August 1992.\nI.\nPlaintiffs contend on appeal that the statute of limitations does not bar their action against defendant and that the trial court therefore erred in granting summary judgment for defendant. N.C.G.S. \u00a7 l-15(c), which establishes a four-year statute of repose and a three-year statute of limitations, provides in pertinent part:\nExcept where otherwise provided by statute, a cause of action for malpractice arising out of the performance of or failure to perform professional services shall be deemed to accrue at the time of the occurrence of the last act of the defendant giving rise to the cause of action: Provided that whenever there is bodily injury to the person, economic or monetary loss, or a defect in or damage to property which originates under circumstances making the injury, loss, defect or damage not readily apparent to the claimant at the time of its origin, and the injury, loss, defect or damage is discovered or should reasonably be discovered by the claimant two or more years after the occurrence of the last act of the defendant giving rise to the cause of action, suit must be commenced within one year from the date discovery is made: Provided nothing herein shall be construed to reduce the statute of limitation in any such case below three years. Provided further, that in no event shall an action be commenced more than four years from the last act of the defendant giving rise to the cause of action ....\nN.C.G.S. \u00a7 l-15(c) (1983); Sharp v. Teague, 113 N.C. App. 589, 593, 439 S.E.2d 792, 794 (1994), disc, review improvidently allowed, 339 N.C. 730, 456 S.E.2d 771 (1995). This statute creates a statute of limitations and a statute of repose, both of which accrue on the date of the \u201clast act of the defendant giving rise to the cause of action.\u201d Id. at 593, 439 S.E.2d at 795.\nIn this case, plaintiffs had two distinct causes of action against defendant, one arising out of defendant\u2019s alleged negligence in failing to procure the transfer of Lot 3 in 1985, and the other arising out of defendant\u2019s alleged negligence in procuring a deed to Lot 3 in 1990 after the Weisses had filed for bankruptcy. We find that while the first cause of action is barred by section l-15(c), the second is not.\nIn 1985, McGahren and his partner, Weiss, contracted with defendant to prepare a deed transferring title to various pieces of real property, including Lot 3, from the partnership to McGahren. Defendant failed to include Lot 3 in the deed to McGahren. Defendant\u2019s last act giving rise to the cause of action was his delivery of the 1985 deed to McGahren, which we note necessarily occurred at some time prior to 25 June 1985, the date McGahren recorded the deed. See Hargett v. Holland, 337 N.C. 651, 654, 447 S.E.2d 784, 787 (1994) (defendant attorney\u2019s last act giving rise to cause of action occurred when he supervised execution of will he had negligently drafted). At that time, McGahren had at least constructive knowledge of all the essential elements of a complete malpractice cause of action. See Thorpe v. DeMent, 69 N.C. App. 355, 362, 317 S.E.2d 692, 697, aff'd per curiam, 312 N.C. 488, 322 S.E.2d 777 (1984). Because plaintiffs did not institute their action within three years of defendant\u2019s 1985 negligence, that cause of action is barred by the statute of limitations.\nHowever, in 1990 defendant allegedly committed a separate act of negligence in procuring for McGahren a deed to Lot 3 from the Weisses, who had filed for bankruptcy. Plaintiffs\u2019 complaint, filed in 1992, was clearly filed within three years of defendant\u2019s negligent act. Thus, the trial court erred in ruling that plaintiffs\u2019 claim was barred by the statute of limitations. Likewise, plaintiffs\u2019 claim for wanton negligence, which is based on the 1990 negligence of defendant, was not barred by the statute of limitations.\nII.\nWe do find, however, that summary judgment for defendant was proper as to plaintiffs\u2019 remaining claims, labeled \u201cmisrepresentation/fraud\u201d and \u201cintentional misrepresentation.\u201d Regarding these claims, plaintiffs\u2019 complaint refers to a letter from defendant containing allegedly false statements. Aside from these specific allegations regarding the letter, plaintiffs\u2019 remaining allegations merely restate the grounds for the legal malpractice cause of action. As such, these latter allegations do not support a cause of action for fraud. Sharp, 113 N.C. App. at 597, 439 S.E.2d at 797. The statements plaintiffs allege were fraudulently made are found in a letter from defendant to McGahren, dated 30 August 1991, wherein defendant stated that the bankruptcy trustee agreed with McGahren that the property was his, that the bankruptcy court made no claim to the property, and that the property was McGahren\u2019s.\nThe elements of fraud are: \u201c(1) False representation or concealment of a material fact, (2) reasonably calculated to deceive, (3) made with intent to deceive, (4) which does in fact deceive, (5) resulting in damage to the injured party.\u201d Ragsdale v. Kennedy, 286 N.C. 130, 138, 209 S.E.2d 494, 500 (1974). In this case, plaintiffs, themselves, have shown that the fourth element is lacking. In his affidavit, McGahren states that as of March 1991 he knew that the 1990 deed was of no value, and that when he received defendant\u2019s 30 August 1991 letter, he knew that defendant\u2019s statements in the letter about the trustee\u2019s intentions regarding the property were \u201ccompletely false.\u201d It is clear, then, that defendant\u2019s statements in the letter did not deceive McGahren. Thus, the fourth element of fraud was nonexistent. Accordingly, summary judgment for defendants on the misrepresentation claims was proper.\nFor the reasons stated, the judgment of the trial court is affirmed as to the misrepresentation claims and the 1985 negligence claim, and reversed as to the negligence claims arising from the 1990 deed.\nAffirmed in part; reversed in part and remanded.\nJudges WYNN and McGEE concur.", "type": "majority", "author": "LEWIS, Judge." } ], "attorneys": [ "Law Offices of Matthew F. McGahren, by Matthew F. McGahren, for plaintiffs-appellants.", "Van Winkle, Buck, Wall, Starnes and, Davis, P.A., by Roy W. Davis, Jr. and Michelle Rippon, for defendant-appellee." ], "corrections": "", "head_matter": "FRANCIS J. McGAHREN and wife, JOHANNA F. McGAHREN v. GEORGE W. SAENGER\nNo. 9428SC537\n(Filed 2 May 1995)\n1. Limitations, Repose, and Laches \u00a7 26 (NCI4th)\u2014 legal malpractice claims \u2014 applicability of statute of limitations\nPlaintiffs\u2019 legal malpractice claim filed in 1992 and arising out of defendant attorney\u2019s alleged negligence in failing to procure the transfer of a lot in 1985 was barred by the statute of limitations; however, their cause of action filed in 1992 and arising out of defendant\u2019s alleged negligence in procuring a deed to the lot in 1990 after plaintiffs\u2019 business partners had filed for bankruptcy was not barred by the statute of limitations. N.C.G.S. \u00a7 l-15(c).\nAm Jur 2d, Attorneys at Law \u00a7\u00a7 219-221.\nWhat statute of limitations governs damage action against attorney for malpractice. 2 ALR4th 284.\n2. Fraud, Deceit, and Misrepresentation \u00a7 38 (NCI4th)\u2014 insufficiency of evidence of deception\nSummary judgment was properly entered for defendant on plaintiffs\u2019 claim for fraud based on a letter written by defendant with regard to plaintiffs\u2019 lot, which was originally omitted from a deed drawn by defendant, since plaintiffs\u2019 own affidavit showed that plaintiffs were not deceived by defendant\u2019s letter, even if it did contain false statements intended to deceive.\nAm Jur 2d, Fraud and Deceit \u00a7\u00a7 481 et seq.\nAppeal by plaintiffs from judgment entered 10 February 1994 by Judge C. Walter Allen in Buncombe County Superior Court. Heard in the Court of Appeals 27 January 1995.\nLaw Offices of Matthew F. McGahren, by Matthew F. McGahren, for plaintiffs-appellants.\nVan Winkle, Buck, Wall, Starnes and, Davis, P.A., by Roy W. Davis, Jr. and Michelle Rippon, for defendant-appellee." }, "file_name": "0649-01", "first_page_order": 681, "last_page_order": 686 }