{ "id": 11916211, "name": "CHARLES S. HURSEY, & WIFE, ELLEN HURSEY, Plaintiffs-Appellees v. HOMES BY DESIGN, INC., MELISA (LISA) G. WOODS, RAYMOND LEWIS WOODS, WOODS AND ASSOCIATES, WOODS AND ASSOCIATES HOMES BY DESIGN, AND DAVID B. LAWSON, Defendants-Appellants", "name_abbreviation": "Hursey v. Homes By Design, Inc.", "decision_date": "1995-12-19", "docket_number": "No. COA95-69", "first_page": "175", "last_page": "180", "citations": [ { "type": "official", "cite": "121 N.C. App. 175" } ], "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": "49 ALR Fed. 831", "category": "reporters:federal", "reporter": "A.L.R. Fed.", "opinion_index": -1 }, { "cite": "432 S.E.2d 156", "category": "reporters:state_regional", "reporter": "S.E.2d", "weight": 4, "year": 1993, "pin_cites": [ { "page": "177" }, { "page": "159" } ], "opinion_index": 0 }, { "cite": "111 N.C. App. 173", "category": "reporters:state", "reporter": "N.C. App.", "case_ids": [ 8520964 ], "year": 1993, "opinion_index": 0, "case_paths": [ "/nc-app/111/0173-01" ] }, { "cite": "362 S.E.2d 868", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 1987, "pin_cites": [ { "page": "869", "parenthetical": "specifically rejecting plaintiff's argument that North Carolina courts should adhere to the rule adopted in the federal courts that dismissal with prejudice is a last resort and is generally proper only where less drastic sanctions are unavailable" } ], "opinion_index": 0 }, { "cite": "88 N.C. App. 274", "category": "reporters:state", "reporter": "N.C. App.", "case_ids": [ 8358104 ], "year": 1987, "pin_cites": [ { "page": "275", "parenthetical": "specifically rejecting plaintiff's argument that North Carolina courts should adhere to the rule adopted in the federal courts that dismissal with prejudice is a last resort and is generally proper only where less drastic sanctions are unavailable" } ], "opinion_index": 0, "case_paths": [ "/nc-app/88/0274-01" ] }, { "cite": "324 S.E.2d 829", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 1985, "pin_cites": [ { "page": "833" } ], "opinion_index": 0 }, { "cite": "312 N.C. 770", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 4755941 ], "year": 1985, "pin_cites": [ { "page": "777" } ], "opinion_index": 0, "case_paths": [ "/nc/312/0770-01" ] }, { "cite": "345 S.E.2d 217", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 1986, "opinion_index": 0 }, { "cite": "317 N.C. 328", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 4774529 ], "year": 1986, "opinion_index": 0, "case_paths": [ "/nc/317/0328-01" ] }, { "cite": "335 S.E.2d 197", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 1985, "pin_cites": [ { "page": "199" } ], "opinion_index": 0 }, { "cite": "77 N.C. App. 359", "category": "reporters:state", "reporter": "N.C. App.", "case_ids": [ 8522452 ], "year": 1985, "pin_cites": [ { "page": "361" } ], "opinion_index": 0, "case_paths": [ "/nc-app/77/0359-01" ] } ], "analysis": { "cardinality": 538, "char_count": 10946, "ocr_confidence": 0.761, "pagerank": { "raw": 5.110500438478862e-07, "percentile": 0.9385126314314077 }, "sha256": "369b1d888cc73a36a99e62b26bc96ed8b5c48f98d0bd6281adec9e1c931a8043", "simhash": "1:cfc2613a3c1a9de0", "word_count": 1746 }, "last_updated": "2023-07-14T20:54:48.563497+00:00", "provenance": { "date_added": "2019-08-29", "source": "Harvard", "batch": "2018" }, "casebody": { "judges": [ "Judges LEWIS and MARTIN, MARK D. concur." ], "parties": [ "CHARLES S. HURSEY, & WIFE, ELLEN HURSEY, Plaintiffs-Appellees v. HOMES BY DESIGN, INC., MELISA (LISA) G. WOODS, RAYMOND LEWIS WOODS, WOODS AND ASSOCIATES, WOODS AND ASSOCIATES HOMES BY DESIGN, AND DAVID B. LAWSON, Defendants-Appellants" ], "opinions": [ { "text": "WALKER, Judge.\nPlaintiffs filed this action seeking to recover money damages and to impose constructive trusts on real property held by defendants based on defendants\u2019 alleged fraud, conversion, breach of contract, breach of fiduciary duty, and an unlawful conspiracy to conceal and misappropriate sums owed by defendants to plaintiffs. All defendants answered and counterclaimed except defendant David B. Lawson, against whom a judgment of default was entered on 21 January 1994.\nOn 26 January 1994, in an attempt to obtain records needed to document defendants\u2019 alleged misuse of plaintiffs\u2019 funds, plaintiffs served upon defendants their First Interrogatories and Request for Production of Documents. Defendants did not respond within the allotted time. On 31 March 1994, plaintiffs filed a Motion to Compel Discovery. On 11 April 1994, at the hearing on the motion, defendants responded to the interrogatories propounded by plaintiffs, and the parties agreed to remove the motion from the calendar. After reviewing the responses and documents provided by defendants, plaintiffs requested defendants\u2019 counsel to provide voluntary supplementation to the responses. This request was ignored. Plaintiffs thereupon filed a second Motion to Compel Discovery on 9 May 1994.\nOn 19 May 1994, plaintiffs served upon defendants a Second Request for Production of Documents. When defendants failed to respond, plaintiffs filed another Motion to Compel Discovery on 7 July 1994. On 15 August 1994, the trial court issued a ruling compelling defendants to produce certain designated documents by 18 August 1994. Defendants failed to comply with this ruling, and plaintiffs moved for sanctions pursuant to Rule 37 of the North Carolina Rules of Civil Procedure. Following a hearing on the Motion for Sanctions on 23 August 1994, the trial court issued an order striking defendants\u2019 counterclaims and dismissing them with prejudice. Defendants filed their pro se written notice of appeal on 22 September 1994.\nNorth Carolina General Statutes \u00a7 1A-1, Rule 37(b)(2) provides that where parties to an action fail to obey an order to provide or permit discovery, the court in which the action is pending \u201cmay make such orders in regard to the failure as are just,\u201d including:\n(c) An order striking out pleadings or parts thereof, or staying further proceedings until the order is obeyed, or dismissing the action or proceeding or any part thereof, or rendering a judgment by default against the disobedient party ....\nN.C. Gen. Stat. \u00a7 1A-1, Rule 37(b)(2)(c) (1990) (emphasis added). Sanctions under Rule 37 are within the sound discretion of the trial court and will not be overturned on appeal absent a showing of abuse of that discretion. Vick v. Davis, 77 N.C. App. 359, 361, 335 S.E.2d 197, 199 (1985), affirmed, 317 N.C. 328, 345 S.E.2d 217 (1986). Atrial court may be reversed for abuse of discretion only upon a showing that its ruling was so arbitrary that it could not have been the result of a reasoned decision. White v. White, 312 N.C. 770, 777, 324 S.E.2d 829, 833 (1985).\nIn support of its order, the trial court made the following findings of fact:\n1. Plaintiffs\u2019 Second Request for Production of Documents . . . was served on defendants by serving their then counsel of record by certificate dated May 19, 1994.\n2. The defendants have not served a written response to Plaintiffs\u2019 Second Request for Production of Documents.\n3. On August 15, 1994, pursuant to notice, the undersigned Judge Presiding heard the plaintiffs\u2019 Motions to Compel Discovery filed July 7, 1994, May 9, 1994, March 31, 1994, and July 7, 1994 [sic]. After considering the record, arguments of counsel for the plaintiffs and arguments of the defendants, the Court ordered the defendants to produce, by Thursday, August 18, 1994, those documents requested in Plaintiffs\u2019 Second Request for Production of Documents . . . and all documents from which defendants obtained the information set forth in their answers to Interrogatory 1(b), 1(c) and 2(a) of their \u201cAnswers to First Set of Interrogatories and Request for Production of Documents\u201d served by their then counsel of record on April 11, 1994.\n4. Defendants have not produced the documents as ordered.\n5. The defendants have represented to the Court that these documents are not within their possession, but are within the possession of their accountant or the State Bureau of Investigation.\n6. Counsel for the plaintiffs tendered to the Court certified copies from the Clerk of Superior Court of Alamance County of Inventory of Seized Property itemizing all property of the defendants seized by the State Bureau of Investigation. With certain minor exceptions, the documents requested by the plaintiffs do not appear on this inventory ....\n7. The defendants stated in open court that the documents are not in the possession of their accountants.\n8. On April 11, 1994, subsequent to the SBI seizure of the aforesaid property, the defendants, through counsel, served answers to Plaintiffs\u2019 First Set of Interrogatories and Request for Production of Documents, setting forth specific figures in their answers to Interrogatories 1(b), 1(c), and 2(a). Defendants failed to produce documentation from which those figures were obtained.\n9. On May 12,1994, subsequent to the seizure of documents by the SBI, defendants supplemented their answers to interrogatories by producing copies of Central Carolina Bank bank statements on an account in the name of Homes By Design, Inc., along with a number of checks on this Homes By Design, Inc. account written to Charles S. Hursey. However, plaintiffs [sic] did not produce the bank statements on other accounts or copies of the other checks written on the Homes By Design, Inc. account.\n10. On August 12, 1994, in a civil action pending in the General Court of Justice, Superior Court Division of Alamance County as \u201cCharles S. Hursey and Ellen Hursey, Plaintiffs vs. Homes By Design, Inc. and Lisa G. Woods, Defendants\u201d, [sic] . . . defendants filed a response to a summary judgment motion attaching documents which included a copy of a Homes By Design, Inc. check and a copy of a check written to defendants by plaintiffs\u2019 business, which checks had not been previously produced.\n11. The defendants are or should be aware of the potential consequences of failing to respond to discovery requests since in April, 1994, as appears of record in the office of the Clerk of Superior Court of Alamance County in a certain civil action entitled \u201cChristine L. Leath and Lula B. Albright, Plaintiffs vs. Raymond L. Woods and Lisa G. Woods d/b/a Woods and Associates Homes By Design and Homes By Design, Inc.\u201d, [sic] . . . the Honorable D. Marsh McLelland heard a similar Motion for Sanctions on behalf of the plaintiffs in that case against these same defendants for failure by these same defendants to provide discovery. Judge McLelland entered an order striking the counterclaim asserted by the defendants in that case.\nWe have carefully reviewed the record, and we find plenary evidence therein to support the trial court\u2019s thorough findings. Because the court\u2019s imposition of sanctions was clearly the result of a reasoned decision, we find no abuse of discretion in the court\u2019s order.\nDefendants concede that Rule 37(b)(2) permits the trial court, in its discretion, to dismiss claims with prejudice when it is \u201cjust\u201d to do so. See Fulton v. East Carolina Trucks, Inc., 88 N.C. App. 274, 275, 362 S.E.2d 868, 869 (1987) (specifically rejecting plaintiff\u2019s argument that North Carolina courts should adhere to the rule adopted in the federal courts that dismissal with prejudice is a last resort and is generally proper only where less drastic sanctions are unavailable). However, relying on Goss v. Battle, 111 N.C. App. 173, 432 S.E.2d 156 (1993), defendants argue that the trial court\u2019s order striking and dismissing their counterclaims was error because it does not reflect that the court considered imposing less severe sanctions. In Goss, a divided panel of this Court held that before dismissing a party\u2019s claim with prejudice pursuant to Rule 37, the trial court must consider less severe sanctions. Id. at 177, 432 S.E.2d at 159. The Goss court noted that in that case, neither the transcript of the hearing on the motion for sanctions nor the court\u2019s order indicated that the trial court considered a less severe sanction before dismissing the plaintiff\u2019s action. Id.\nIn the present case, the transcript of the hearing on the Motion for Sanctions indicates that plaintiffs asked the trial court to strike defendants\u2019 answer and counterclaims, or, alternatively, to strike defendants\u2019 counterclaims only and to enter an order requiring defendants to pay plaintiffs\u2019 expenses in obtaining documents directly from banks and medical providers. After hearing arguments, the court chose not to impose the more severe sanction requested by plaintiffs. Instead, the court entered an order imposing the less severe sanction of striking only the counterclaims, thereby allowing defendants to contest liability as well as damages. We believe it may be inferred from the record that the trial court considered all available sanctions, including the two alternatives proposed by plaintiffs, in arriving at its decision, and the trial court\u2019s action did not violate the rule set forth in Goss. We hold that the sanctions imposed were appropriate in light of defendants\u2019 actions in this case.\nWe have carefully examined defendants\u2019 remaining arguments, and we find them to be without merit. The order of the trial court is\nAffirmed.\nJudges LEWIS and MARTIN, MARK D. concur.", "type": "majority", "author": "WALKER, Judge." } ], "attorneys": [ "Carruthers & Roth, RA., by Kenneth R. Keller, for plaintiffs-appellees.", "Loflin & Loflin, by Thomas F. Loflin, III, for defendants-appellants." ], "corrections": "", "head_matter": "CHARLES S. HURSEY, & WIFE, ELLEN HURSEY, Plaintiffs-Appellees v. HOMES BY DESIGN, INC., MELISA (LISA) G. WOODS, RAYMOND LEWIS WOODS, WOODS AND ASSOCIATES, WOODS AND ASSOCIATES HOMES BY DESIGN, AND DAVID B. LAWSON, Defendants-Appellants\nNo. COA95-69\n(Filed 19 December 1995)\nDiscovery and Depositions \u00a7 68 (NCI4th)\u2014 failure to comply with discovery order \u2014 dismissal of counterclaims with prejudice \u2014 appropriate sanction\nWhere defendants failed to comply with the trial court\u2019s ruling compelling production of documents, and plaintiffs moved for sanctions pursuant to Rule 37 of the North Carolina Rules of Civil Procedure, the trial court\u2019s dismissal of defendants\u2019 counterclaims with prejudice was clearly the result of a reasoned decision and was an appropriate imposition of sanctions. N.C.G.S. \u00a7 1A-1, Rule 37(b)(2).\nAm Jur 2d, Depositions and Discovery \u00a7 385-388.\nSanctions available under Rule 37, Federal Rules of Civil Procedure, for grossly regligent failure to obey discovery order. 49 ALR Fed. 831.\nAppeal by defendants from order entered 25 August 1994 by Judge Orlando F. Hudson in Alamance County Superior Court. Heard in the Court of Appeals 20 October 1995.\nCarruthers & Roth, RA., by Kenneth R. Keller, for plaintiffs-appellees.\nLoflin & Loflin, by Thomas F. Loflin, III, for defendants-appellants." }, "file_name": "0175-01", "first_page_order": 209, "last_page_order": 214 }