{ "id": 9187492, "name": "CENCOMP, INC., d/b/a PHILLIPS IRON WORKS, and TED CIHOS d/b/a PHILLIPS IRON WORKS, Plaintiffs v. WEBCON, INC., and INTERNATIONAL FIDELITY INSURANCE COMPANY, Defendants", "name_abbreviation": "Cencomp, Inc. v. Webcon, Inc.", "decision_date": "2003-05-06", "docket_number": "No. COA02-924", "first_page": "501", "last_page": "507", "citations": [ { "type": "official", "cite": "157 N.C. App. 501" } ], "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": "101 F.2d 524", "category": "reporters:federal", "reporter": "F.2d", "case_ids": [ 1072272 ], "year": 1939, "pin_cites": [ { "page": "526" } ], "opinion_index": 0, "case_paths": [ "/f2d/101/0524-01" ] }, { "cite": "231 N.W.2d 342", "category": "reporters:state_regional", "reporter": "N.W.2d", "case_ids": [ 2554938 ], "weight": 5, "year": 1975, "pin_cites": [ { "page": "344" }, { "page": "344" } ], "opinion_index": 0, "case_paths": [ "/neb/194/0248-01" ] }, { "cite": "240 U.S. 214", "category": "reporters:federal", "reporter": "U.S.", "case_ids": [ 3689490 ], "weight": 4, "year": 1915, "pin_cites": [ { "page": "218-19" }, { "page": "613" } ], "opinion_index": 0, "case_paths": [ "/us/240/0214-01" ] }, { "cite": "364 S.E.2d 380", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 1988, "opinion_index": 0 }, { "cite": "321 N.C. 435", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 2568970 ], "year": 1988, "opinion_index": 0, "case_paths": [ "/nc/321/0435-01" ] }, { "cite": "354 S.E.2d 360", "category": "reporters:state_regional", "reporter": "S.E.2d", "weight": 3, "year": 1987, "pin_cites": [ { "page": "364", "parenthetical": "emphasis added" }, { "page": "365" } ], "opinion_index": 0 }, { "cite": "85 N.C. App. 114", "category": "reporters:state", "reporter": "N.C. App.", "case_ids": [ 12169646 ], "weight": 3, "year": 1987, "pin_cites": [ { "page": "120-21" }, { "page": "121" } ], "opinion_index": 0, "case_paths": [ "/nc-app/85/0114-01" ] }, { "cite": "639 P.2d 996", "category": "reporters:state_regional", "reporter": "P.2d", "case_ids": [ 10438952 ], "year": 1981, "pin_cites": [ { "page": "1000" } ], "opinion_index": 0, "case_paths": [ "/p2d/639/0996-01" ] }, { "cite": "391 S.E.2d 211", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 1990, "pin_cites": [ { "page": "213" } ], "opinion_index": 0 }, { "cite": "98 N.C. App. 423", "category": "reporters:state", "reporter": "N.C. App.", "case_ids": [ 8524928 ], "year": 1990, "pin_cites": [ { "page": "426" } ], "opinion_index": 0, "case_paths": [ "/nc-app/98/0423-01" ] }, { "cite": "446 S.E.2d 603", "category": "reporters:state_regional", "reporter": "S.E.2d", "weight": 2, "year": 1994, "pin_cites": [ { "page": "605" } ], "opinion_index": 0 }, { "cite": "116 N.C. App. 115", "category": "reporters:state", "reporter": "N.C. App.", "case_ids": [ 8522492 ], "year": 1994, "pin_cites": [ { "page": "118" } ], "opinion_index": 0, "case_paths": [ "/nc-app/116/0115-01" ] }, { "cite": "565 S.E.2d 192", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 2002, "opinion_index": 0 }, { "cite": "355 N.C. 747", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 219949, 220049, 219988, 220057, 219994 ], "year": 2002, "opinion_index": 0, "case_paths": [ "/nc/355/0747-05", "/nc/355/0747-01", "/nc/355/0747-03", "/nc/355/0747-02", "/nc/355/0747-04" ] }, { "cite": "562 S.E.2d 75", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 2002, "pin_cites": [ { "page": "79" } ], "opinion_index": 0 }, { "cite": "149 N.C. App. 825", "category": "reporters:state", "reporter": "N.C. App.", "case_ids": [ 9132493 ], "year": 2002, "pin_cites": [ { "page": "830" } ], "opinion_index": 0, "case_paths": [ "/nc-app/149/0825-01" ] }, { "cite": "290 S.E.2d 593", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 1982, "pin_cites": [ { "page": "596" } ], "opinion_index": 0 }, { "cite": "305 N.C. 603", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 8572803 ], "year": 1982, "pin_cites": [ { "page": "608" } ], "opinion_index": 0, "case_paths": [ "/nc/305/0603-01" ] }, { "cite": "560 S.E.2d 132", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 2001, "pin_cites": [ { "parenthetical": "quoting Green v. Duke Power Co., 305 N.C. 603, 608, 290 S.E.2d 593, 596 (1982)" } ], "opinion_index": 0 }, { "cite": "355 N.C. 214", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 220162, 220199, 220073, 219889, 220030 ], "year": 2001, "pin_cites": [ { "parenthetical": "quoting Green v. Duke Power Co., 305 N.C. 603, 608, 290 S.E.2d 593, 596 (1982)" } ], "opinion_index": 0, "case_paths": [ "/nc/355/0214-04", "/nc/355/0214-05", "/nc/355/0214-01", "/nc/355/0214-03", "/nc/355/0214-02" ] }, { "cite": "552 S.E.2d 686", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 2001, "pin_cites": [ { "page": "689", "parenthetical": "quoting Green v. Duke Power Co., 305 N.C. 603, 608, 290 S.E.2d 593, 596 (1982)" } ], "opinion_index": 0 }, { "cite": "146 N.C. App. 203", "category": "reporters:state", "reporter": "N.C. App.", "case_ids": [ 11355514 ], "year": 2001, "pin_cites": [ { "page": "207", "parenthetical": "quoting Green v. Duke Power Co., 305 N.C. 603, 608, 290 S.E.2d 593, 596 (1982)" } ], "opinion_index": 0, "case_paths": [ "/nc-app/146/0203-01" ] }, { "cite": "500 S.E.2d 666", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 1998, "pin_cites": [ { "page": "667" } ], "opinion_index": 0 }, { "cite": "348 N.C. 583", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 1659725 ], "year": 1998, "pin_cites": [ { "page": "584" } ], "opinion_index": 0, "case_paths": [ "/nc/348/0583-01" ] } ], "analysis": { "cardinality": 733, "char_count": 15466, "ocr_confidence": 0.762, "pagerank": { "raw": 4.03580807328026e-08, "percentile": 0.21537105059020817 }, "sha256": "7705ce2886058507fb6e580a82ec054eec1aae061ec8b3f7f7380190c8194848", "simhash": "1:13caf5e31cb1c5ea", "word_count": 2479 }, "last_updated": "2023-07-14T16:54:20.581695+00:00", "provenance": { "date_added": "2019-08-29", "source": "Harvard", "batch": "2018" }, "casebody": { "judges": [ "Judges McCULLOUGH and TYSON concur." ], "parties": [ "CENCOMP, INC., d/b/a PHILLIPS IRON WORKS, and TED CIHOS d/b/a PHILLIPS IRON WORKS, Plaintiffs v. WEBCON, INC., and INTERNATIONAL FIDELITY INSURANCE COMPANY, Defendants" ], "opinions": [ { "text": "CALABRIA, Judge.\nPlaintiffs, Cencomp, Inc., d/b/a Phillips Iron Works and Ted Cihos d/b/a Phillips Iron Works (collectively \u201cPhillips\u201d), were subcontractors of defendant Webcon, Inc. (\u201cWebcon\u201d) on a construction project related to a sewer line for the City of Roxboro (\u201cthe City\u201d). Defendant International Fidelity Insurance Company (\u201cFidelity\u201d) was the payment bond surety on the project.\nOn 11 December 2000, Phillips filed suit against Webcon asserting breach of contract and quantum meruit claims, and against Webcon and Fidelity asserting a payment bond claim pursuant to N.C. Gen. Stat. \u00a7 44A-26 (2001). The court granted Fidelity\u2019s motion for summary judgment, finding the suit was time-barred because: (1) N.C. Gen. Stat. \u00a7 44A-28(b) required Phillips file its claim on the bond within one year after the City and Webcon reached a \u201cfinal settlement;\u201d (2) a final settlement occurred on 21 September 1999; and (3) Phillips\u2019 suit was not filed until 11 December 2000, more than one year later. The court then granted Webcon\u2019s motion for a change of venue because without Fidelity there was no basis for venue in Person County. Phillips appeals.\n\u201cThe order of the superior court granting the defendant\u2019s motion for summary judgment did not dispose of all the claims in the case, making it interlocutory.\u201d DKH Corp. v. Rankin-Patterson Oil Co., 348 N.C. 583, 584, 500 S.E.2d 666, 667 (1998). Although an interlocutory order is ordinarily not immediately appealable, an interlocutory order may be immediately appealed if it affects a substantial right. N.C. Gen. Stat. \u00a7\u00a7 l-277(a) and 7A-27(d)(l) (2001). Phillips asserts a substantial right \u201cto have the case heard in Person County and to have the liability of all Defendants determined in one proceeding\u201d will be lost without appellate review. \u201c \u2018The right to avoid the possibility of two trials on the same issues can be ... a substantial right\u2019 that permits an appeal of an interlocutory order when there are issues of fact common to the claim appealed and remaining claims.\u201d Phillips v. Restaurant Mgmt. of Carolina, L.P., 146 N.C. App. 203, 207, 552 S.E.2d 686, 689, disc. review denied, 355 N.C. 214, 560 S.E.2d 132 (2001) (quoting Green v. Duke Power Co., 305 N.C. 603, 608, 290 S.E.2d 593, 596 (1982)). Here, the summary judgment disposed of only the claim on the payment bond against Fidelity, and remaining claims against Webcon include claims on the payment bond, breach of contract, and quantum meruit. Since the claims against Webcon remain and there are common issues of fact, we find Phillips properly asserted a substantial right and appealed the interlocutory summary judgment order against Fidelity.\nPhillips asserts the trial court erred by: (I) determining no genuine issue of material fact existed as to whether a \u201cfinal settlement\u201d was reached between Webcon and the City in September 1999; and (II) ordering venue be transferred.\nI. Summary Judgment\n\u201cSummary judgment is properly granted when the pleadings, depositions, answers to interrogatories, admissions and affidavits show no genuine issue of material fact exists, and the movant is entitled to judgment as a matter of law. . . . [T]he evidence is viewed in the light most favorable to the non-movant.\u201d Bostic Packaging, Inc. v. City of Monroe, 149 N.C. App. 825, 830, 562 S.E.2d 75, 79, disc. review denied, 355 N.C. 747, 565 S.E.2d 192 (2002). Since the trial court granted Fidelity summary judgment on the basis that Phillips failed to file its complaint within the allotted time restrictions provided for by N.C. Gen. Stat. \u00a7 44A-28(b), the issue for this Court is whether, in the light most favorable to Phillips, a genuine issue of material fact exists regarding the timeliness of the complaint.\nNorth Carolina law provides:\nNo action on a payment bond shall be commenced after the expiration of the longer period of one year from the day on which the last of the labor was performed or material was furnished by the claimant, or one year from the day on which final settlement was made with the contractor.\nN.C. Gen. Stat. \u00a7 44A-28(b) (2001). This statute is a statute of repose and a condition precedent, therefore, plaintiff has the burden of proving its cause of action was brought within the one-year time period. Tipton & Young Construction Co. v. Blue Ridge Structure Co., 116 N.C. App. 115, 118, 446 S.E.2d 603, 605 (1994). If plaintiff fails to meet its burden, \u201c \u2018plaintiff\u2019s case is insufficient as a matter of law[,]\u2019 \u201d and summary judgment for defendant is proper. Id., (quoting Chicopee, Inc. v. Sims Metal Works, 98 N.C. App. 423, 426, 391 S.E.2d 211, 213 (1990)).\nPhillips asserts it met its burden and complied with the statute because the settlement reached between Webcon and the City in September 1999 was not a \u201cfinal settlement\u201d since the City retained approximately $50,000.00. Defendants disagree asserting that on 21 September 1999 the City determined the \u201cfinal settlement\u201d and therefore Phillips\u2019 claim against Fidelity is barred by the one-year statute of repose.\nThe meaning of the term \u201cfinal settlement,\u201d originally a federal term from the 1905 Heard Act and later the 1935 Miller Act, \u201cwas litigated extensively and caused considerable uncertainty in the construction industry. In 1959, Congress abandoned the term[.]\u201d Safeco Ins. Co. of America v. Honeywell, Inc., 639 P.2d 996, 1000 (Alaska 1981). Unlike Congress, our state legislature has not abandoned the term.\nWhen interpreting the meaning of \u201cfinal settlement,\u201d our courts turn to federal law for guidance. Pyco Supply Co., Inc. v. American Centennial Ins. Co., 85 N.C. App. 114, 354 S.E.2d 360 (1987), rev\u2019d on other grounds, 321 N.C. 435, 364 S.E.2d 380 (1988). In Pyco, this Court quoted the seminal United States Supreme Court decision, Illinois Surety Co. v. U.S. to the use of Peeler, et al., 240 U.S. 214, 60 L. Ed. 609 (1915), in which,\nthe [United States Supreme] Court held that final settlement occurred when, so far as the government was concerned, the amount which it was bound to pay was administratively fixed by the proper authority. . . . [And the Court explained t]he date of the final settlement does not depend upon the contractor\u2019s agreement and must be clear, readily ascertainable and occur at a definite time.\nPyco, 85 N.C. App. at 120-21, 354 S.E.2d at 364 (emphasis added). In Illinois Surety, the Court expressly stated that final settlement is not synonymous with final payment. Illinois Surety, 240 U.S. at 218-19, 60 L. Ed. at 613. See also Zimmerman\u2019s Electric, Inc. v. Fidelity and Deposit Co. of Maryland, 231 N.W.2d 342, 344 (Neb. 1975); United States v. Arthur Storm Co., 101 F.2d 524, 526 (6th Cir., 1939).\nTherefore, the question for this Court is whether there is any genuine issue of material fact as to whether the City administratively fixed the amount it was bound to pay on 21 September 1999. Phillips asserts that since the contract was not complete and the City retained a portion of the final payment, no final settlement could have been reached. We disagree.\nFirst, we address the completion requirement. The federal act expressly required completion of the contract as a prerequisite to \u201cfinal settlement.\u201d Zimmerman, 231 N.W.2d at 344-45 (citing and discussing numerous federal cases regarding the completion requirement). Although not expressly included in state statutes, the completion requirement has been interpreted as \u201can inherent requirement.\u201d Id., 231 N.W.2d at 344. The Supreme Court of Nebraska reasoned that without this final completion \u201cthere could be a final ascertainment of the amount due immediately on the execution of a contract providing for the payment of a specified sum or on issuance of each monthly statement as the work progressed[.]\u201d Id. While such an interpretation is possible, we do not find a final completion requirement need be implied into our statute since the doctrine of substantial completion adequately addresses the aforementioned concerns. Certainly a project must be substantially complete before a governmental agency is capable of administratively fixing the amount it is bound to pay, however, our legislature did not expressly require the contract to be one-hundred-percent completed before the government may determine the final settlement, and we choose not to import this language into our law.\nSecond, we address the effect of a governmental entity retaining some of the final settlement. It is true that \u201c[the government\u2019s] retainage of funds casts doubt on whether its [] payment was intended to be a genuinely \u2018final\u2019 payment.\u201d Pyco, 85 N.C. App. at 121, 354 S.E.2d at 365. However, as explained earlier, final payment and final settlement are not synonymous. While retainage directly affects final payment, it does not have a similar impact on final settlement. A governmental entity may administratively fix the amount it is bound to pay, and then retain a portion of that payment to ensure not only that the contractor completes the entire project, including the punch-list, but also that no liens are outstanding.\nSince we have now established a final settlement could have been reached under North Carolina law, the question for this Court is whether there is a genuine issue of material fact regarding whether \u201cthe amount which [the governmental entity] was bound to pay was administratively fixed by the proper authority\u201d and therefore a final settlement, in fact, occurred.\nThe evidence tended to show that on 15 September 1999 Webcon sent a final billing to the City. The total bill was $503,458.93, and since the City had paid $321,044.85, the total due was $182,414.08. Shortly thereafter, Kimley-Horn, the engineers for the project, also wrote to the City explaining: \u201cthe work performed by WEBCON is substantially complete. Final payment (less retainage) should be made. . . . Th[e] retainage balance should be paid to WEBCON after the City is satisfied that the project is 100% complete.\u201d On 20 September 1999, the President of Webcon wrote to Kimley-Horn explaining some miscalculations and noting \u201c[p]er my meeting with the Town of Roxboro, the project has been accepted and all monies are due.\u201d On 21 September 1999, the City wrote to Webcon, enclosing a check for $132,122.34, which represented the $182,414.08 due less $50,291.74 in retainage. The City explained:\n[t]he City of Roxboro has received several complaints from subcontractors and suppliers regarding the failure of Webcon Incorporated to pay invoices for materials and services related to this project in a timely manner. Therefore, the retainage amount shown above of $50,291.74 will not be remitted to Webcon Incorporated until all suppliers and subcontractors have been paid in full. In addition, the City will require Webcon Incorporated to sign a waiver of lien stating that all vendors have been paid in full and that there are no outstanding liens or claims against the City of Roxboro relating to the Reamstown Sewer Line Extension Project.\nIn a deposition, the Finance Director for the City, James C. Overton, Jr., (\u201cOverton\u201d) testified: \u201c[a]s far as I\u2019m concerned, that\u2019s the final amount [$503,458.93] that we owe them.\u201d He further explained the concept of retainage:\n[u]sua!ly on construction contracts, we retain either five or ten percent from the total contract. Each invoice that comes in, we retain five to ten percent. That retainage is held back to make sure that the contract is completed to the satisfaction of the city, that it passes final inspection, and that all bills have been paid and that there\u2019s no liens against it. And once all of that final inspection\u2019s been done, we release and pay the retainage.\nOverton clarified that unless Webcon failed to meet these requirements, the retainage would be released. Thomas S. Warren, Jr., the City\u2019s engineering technician for the Reamstown project, testified that although the contractor generally submits a final bill for everything they are owed including the retainage, \u201c[the City] usually do[es] not pay the retainers in the final billing. The retainage is usually [paid] one to two to three months after that.\u201d\nTaking this evidence in the light most favorable to Phillips, although the project was not one-hundred-percent complete and the City retained a portion of the amount due, it is nevertheless apparent that on 21 September 1999, the City administratively fixed the amount it was due to pay, thereby reaching a final settlement. Since Phillips filed suit on 11 December 2000, more than one year after final settlement, in violation of N.C. Gen. Stat. \u00a7 44A-28(b), the trial court properly granted Fidelity summary judgment.\nII. Venue\nPhillips\u2019 appeal of the venue transfer was predicated upon this Court\u2019s determination that summary judgment was improper. Since we determined the trial court properly granted summary judgment for Fidelity, this assignment of error is overruled.\nThe orders of the trial court are affirmed.\nAffirmed.\nJudges McCULLOUGH and TYSON concur.", "type": "majority", "author": "CALABRIA, Judge." } ], "attorneys": [ "William M. Black, Jr., for plaintiff-appellant.", "Armstrong & Armstrong, P.A., by L. Lamar Armstrong, Jr., for defendants-appellees." ], "corrections": "", "head_matter": "CENCOMP, INC., d/b/a PHILLIPS IRON WORKS, and TED CIHOS d/b/a PHILLIPS IRON WORKS, Plaintiffs v. WEBCON, INC., and INTERNATIONAL FIDELITY INSURANCE COMPANY, Defendants\nNo. COA02-924\n(Filed 6 May 2003)\n1. Appeal and Error\u2014 appealability \u2014 summary judgment\u2014 interlocutory order \u2014 substantial right\nAlthough an appeal from the trial court\u2019s grant of summary judgment in favor of defendant is an appeal from an interlocutory order since it did not dispose of all the claims in the case, the order is immediately appealable because the right to avoid the possibility of two trials on the same issues when there are issues of fact common to the claims appealed and remaining claims affects a substantial right.\n2. Construction Claims\u2014 breach of contract \u2014 quantum meruit \u2014 payment bond \u2014 timeliness of claim \u2014 final settlement\nThe trial court did not err in a breach of contract and quantum meruit case arising out of a construction payment bond claim under N.C.G.S. \u00a7 44A-26 by granting summary judgment in favor of defendant payment bond surety on the basis that plaintiff failed to file its complaint within the allotted time restrictions provided under N.C.G.S. \u00a744A-28(b) even though plaintiff asserts the settlement reached between the parties on 21 September 1999 was not a final settlement since the pertinent city retained approximately $50,000, because: (1) although a project must be substantially completed before a government agency may determine the final settlement, our legislature does not require the contract to be 100% complete before the government may determine the final settlement; and (2) a governmental entity may administratively fix the' amount it is bound to pay and then retain a portion of that payment to ensure not only that the contractor completes the entire project, but also that no liens are outstanding.\n3. Venue\u2014 transfer \u2014 propriety of summary judgment\nAlthough plaintiff appealed the venue transfer predicated on a determination by the appellate court that summary judgment was improper, this assignment of error is overruled because the appellate court determined that the trial court properly granted summary judgment in favor of defendant payment bond surety.\nAppeal by plaintiffs from orders entered 10 April 2002 by Judge Howard E. Manning, Jr., in Person County Superior Court. Heard in the Court of Appeals 19 February 2003.\nWilliam M. Black, Jr., for plaintiff-appellant.\nArmstrong & Armstrong, P.A., by L. Lamar Armstrong, Jr., for defendants-appellees." }, "file_name": "0501-01", "first_page_order": 533, "last_page_order": 539 }