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      "WENDELL A. FORDHAM v. A.V. EASON and wife, GRACE W. EASON; and AMERICAN WOODLAND INDUSTRIES, INC."
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        "text": "ORR, Justice.\nThis case arises out of a dispute between defendant-appellant American Woodland Industries, Inc. (AWI) and plaintiff-appellee Wendell A. Fordham over a parcel of timber owned by defendants A.V. Eason and his wife, Grace W. Eason (Easons). On 11 November 1996, the Easons signed an agreement with Fordham titled \u201cTimber Cutting Contract.\u201d This contract gave Fordham rights to \u201call timber and pulpwood located on all lands owned by Mr. A.V. Eason and being located in Johnston County, N.C.,\u201d until 1 June 1997. On 7 February 1997, the Easons entered into a separate agreement with AWI titled \u201cTimber Purchase and Sales Agreement.\u201d This agreement covered the same parcel of land as Fordham\u2019s \u201cTimber Cutting Contract\u201d with the Easons and allowed AWI to cut and remove timber from the Easons\u2019 property for two years. AWI recorded the \u201cTimber Purchase and Sales Agreement\u201d with the Johnston County Register of Deeds \u00f3n 10 February 1997.\nAWI began to cut timber on the Easons\u2019 property within forty-eight hours of recording the \u201cTimber Purchase and Sales Agreement.\u201d On 12 February 1997, Fordham obtained a temporary restraining order enjoining AWI from continuing its logging operation on the Easons\u2019 property. In a complaint, filed on 14 February 1997, Fordham alleged breach of contract against the Easons and interference with contractual relations and \u201cunfair and deceptive trade practices\u201d against AWI, and requested a preliminary injunction \u201cprohibiting the cutting of timber on the property of the Defendant Eason by the Defendant AWI.\u201d On 17 February 1997, the trial court granted a preliminary injunction barring AWI from \u201charvesting or logging any of the timber located on those lands owned by Defendants Eason.\u201d Several days after the trial court entered the preliminary injunction, Fordham entered the Easons\u2019 property and cut and removed timber.\nAWI filed an answer to Fordham\u2019s complaint on 21 March 1997 denying all pertinent allegations and alleging several counterclaims, including trespass, wrongful cutting of timber, interference with contractual relations, \u201cunfair and deceptive trade practices,\u201d and abuse of process. Fordham responded to AWI\u2019s counterclaims on 29 April 1997, also denying all pertinent allegations. Fordham filed for summary judgment of AWI\u2019s counterclaims on 15 September 1997, and AWI filed for summary judgment of Fordham\u2019s claims on 26 September 1997. The motions were heard at the 6 October 1997 Civil Session of Superior Court, Johnston County. The trial court entered an order on 9 October 1997 granting Fordham\u2019s motion for summary judgment of all of AWI\u2019s counterclaims and further granting AWI\u2019s motion for summary judgment of all of Fordham\u2019s claims. AWI appealed to the Court of Appeals from the order allowing Fordham\u2019s motion for summary judgment as to AWTs counterclaims.\nIn a unanimous decision, the Court of Appeals affirmed summary judgment on AWI\u2019s counterclaims against Fordham for interference with contractual rights, for \u201cunfair and deceptive trade practices,\u201d for wrongful cutting of timber, and for trespass, but reversed summary judgment on AWI\u2019s abuse of process claim. As to the trespass claim, the Court of Appeals stated:\nFurthermore, a claim of trespass requires: (1) possession of the property by plaintiff when the alleged trespass was committed; (2) an unauthorized entry by defendant; and (3) damage to plaintiff. Since Woodland cannot show that it was the owner of the land, it cannot maintain a cause of action for trespass.\nFordham v. Eason, 131 N.C. App. 226, 229, 505 S.E.2d 895, 898 (1998) (citation omitted).\nOn 3 March 1999, we allowed AWTs petition for discretionary review of the trespass action but denied Fordham\u2019s conditional petition for discretionary review.\nThe basic issue before this Court for review is whether AWI, under its agreement with the Easons, has sufficient ownership rights to bring an action for trespass. The Court of Appeals ruled that AWI did not. For the reasons set forth below, we disagree.\nThe Court must first evaluate the elements of a trespass cause of action and determine if there are any genuine issues of fact as to any element and if Fordham, as the moving party, was entitled to judgment as a matter of law. Before the Court can analyze AWI\u2019s counterclaim for trespass, we must determine whether it is appropriate to evaluate this particular cause of action and claim for timber rights as a trespass to realty or a trespass to chattel. Essential to this decision is the determination of whether timber should be classified as realty or as goods. Fordham contends that timber should be classified as realty, and AWI contends that timber is classified as goods under the Uniform Commercial Code as adopted in chapter 25 of the North Carolina General Statutes (Uniform Commercial Code). As will be discussed in detail below, in this case, the timber involved in AWI\u2019s \u201cTimber Purchase and Sales Agreement\u201d was goods. Because timber is classified as goods, the Court must evaluate Fordham\u2019s motion for summary judgment on AWI\u2019s counterclaim for trespass using the elements of a trespass to chattel cause of action.\nHistorically, timber interests have been treated as an interest in land. See Drake v. Howell, 133 N.C. 162, 165, 45 S.E. 539, 540 (1903); Mizell v. Burnett, 49 N.C. 249, 252 (1857). Traditional case law classified timber as realty. See Williams v. Parsons, 167 N.C. 529, 531, 83 S.E. 914, 915 (1914); Hawkins v. Goldsboro Lumber Co., 139 N.C. 160, 162, 51 S.E. 852, 853 (1905). As realty, timber transactions had to comply with the formalities required by a transfer of an interest in land. See Dulin v. Williams, 239 N.C. 33, 38, 79 S.E.2d 213, 217 (1953); Winston v. Williams & McKeithan Lumber Co., 227 N.C. 339, 341, 42 S.E.2d 218, 220 (1947); Morton v. Pine Lumber Co., 178 N.C. 163, 167, 100 S.E. 322, 323 (1919). Several cases also distinguished the classification and treatment of standing timber from severed timber. Those decisions held that while standing timber was realty, severed timber was personal property. See Austin v. Brown, 191 N.C. 624, 627, 132 S.E. 661, 662 (1926); Frank Hitch Lumber Co. v. Brown, 160 N.C. 281, 283, 75 S.E. 714, 714-15 (1912).\nWhen North Carolina adopted the Uniform Commercial Code in 1965, it changed the classification of timber when timber is the subject of a contract for sale. N.C.G.S. \u00a7\u00a7 25-2-101, 25-2-107 (1995). The Uniform Commercial Code defines timber as follows:\nA contract for the sale ... of timber to be cut is a contract for the sale of goods within this article whether the subject matter is to be severed by the buyer or by the seller even though it forms part of the realty at the time of contracting, and the parties by identification effect a present sale before severance.\nN.C.G.S. \u00a7 25-2-107(2).\nThe body of law discussing timber rights under N.C.G.S. \u00a7 25-2-107 is limited. In Mills v. New River Wood Corp., 77 N.C. App. 576, 335 S.E.2d 759 (1985), the Court of Appeals held that contracts for the sale of \u201ctimber to be cut\u201d had a four-year statute of limitations because they were governed by N.C.G.S. \u00a7 25-2-107(2). Mills, 77 N.C. App. at 577, 335 S.E.2d at 760.\nWe conclude that timber is classified as goods under North Carolina law when it is the subject of a contract for sale. A dispute over a trespass to timber where the claim of a possessory interest arises under a contract for the sale of timber should be settled using a trespass to chattel analysis. See generally Prosser and Keeton on the Law of Torts \u00a7 14, at 85 (5th ed. 1984) (discussing that trespass to chattel involves personal property or chattel).\nThe basis of a trespass to chattel cause of action lies in \u201cinjury to possession.\u201d Motley v. Thompson, 259 N.C. 612, 618, 131 S.E.2d 447, 452 (1963). A successful action for trespass to chattel requires the party bringing the action to demonstrate that she had either actual or constructive possession of the personalty or goods in question at the time of the trespass, see White v. Morris, 8 N.C. 301, 303 (1821); Carson v. Noblet, 4 N.C. 136 (1814), and that there was an unauthorized, unlawful interference or dispossession of the property, see Binder v. General Motors Acceptance Corp., 222 N.C. 512, 515, 23 S.E.2d 894, 896 (1943); Kirkpatrick v. Crutchfield, 178 N.C. 348, 350, 100 S.E. 602, 604 (1919); Reader v. Moody, 48 N.C. 372, 373-74 (1856).\nIn order to satisfy the first element of a trespass to chattel cause of action, in this case, AWI must have been in either actual or constructive possession of the property at the time Fordham\u2019s alleged trespass was committed. See White, 8 N.C. at 303; Carson, 4 N.C. at 136. Actual possession consists of exercising dominion over, making ordinary use of, or taking the profits from the land in dispute. See Matthews v. Forrest, 235 N.C. 281, 284, 69 S.E.2d 553, 556 (1952). Constructive possession is a legal fiction existing when there is no actual possession, but there is title granting an immediate right to actual possession. See id. The key to assessing possession under a trespass to chattel claim is determining if there is a right to present possession whenever so desired, see Carson, 4 N.C. at 136, or a right to immediate actual possession, see White, 8 N.C. at 303.\nIn this case, AWI is claiming title to the Easons\u2019 tract of timber through its \u201cTimber Purchase and Sales Agreement.\u201d To determine if AWI actually had title to the Easons\u2019 timber through the \u201cTimber Purchase and Sales Agreement,\u201d we must determine if the \u201cTimber Purchase and Sales Agreement\u201d gave AWI possession of the timber at the time Fordham entered the Easons\u2019 property and removed the timber.\nFirst, we look at the agreement between AWI and the Easons. On 7 February 1997, Rubin Williams, acting on behalf of AWI, entered into the agreement with the Easons titled \u201cTimber Purchase and Sales Agreement.\u201d This agreement allowed AWI to enter and remove trees, tops, or laps from a 115-acre tract of land bounded on the east by the Little River and the West by Cat Tail Swamp, as recorded at book 1434, page 584 in the Johnston County Register of Deeds\u2019 office, until 7 February 1999. This agreement priced the timber on a per-unit basis using the species of timber, class of material, and unit type sold. In return for the right to remove timber from the Easons\u2019 property, AWI paid Eason a $30,000 deposit. The \u201cTimber Purchase and Sales Agreement\u201d allowed AWI initially to deduct the cost of any timber removed from the land from the $30,000 deposit consistent with the per-unit prices listed in the agreement. AWI agreed to pay the Easons on a per-unit basis when the $30,000 deposit was completely depleted. Additionally, the agreement required the Easons to refund AWI\u2019s deposit \u201cif there is any stoppage of logging operations for any reason, less the amount of the stumpage cut.\u201d The Easons received a check for $30,000 from AWI on 7 February 1997. A.V. Eason and Grace W. Eason signed the agreement on 10 February 1997 in the presence of Rubin Williams, a Notary Public, but the agreement was not signed by an AWI representative. However, the bottom of the agreement listed American Woodland Industries, Inc. and listed the corporation\u2019s address. Within forty-eight hours of recording the \u201cTimber Purchase and Sales Agreement,\u201d AWI entered the Easons\u2019 property and began cutting timber.\nTo determine if AWI had possession of the Easons\u2019 timber at the time Fordham entered and removed timber, we must evaluate the \u201cTimber Purchase and Sales Agreement\u201d under the Uniform Commercial Code and decide if AWI\u2019s contract for the sale of timber was enforceable and what its rights, if any, were under that contract. See N.C.G.S. \u00a7\u00a7 25-2-107, 25-2-102 (1995).\nThe Uniform Commercial Code applies more liberal rules governing the formation of contracts than the rules applied under traditional common law. See N.C.G.S. \u00a7 25-1-102. Section 25-2-204 of the Uniform Commercial Code provides for the general formation of contracts. See N.C.G.S. \u00a7 25-2-204 (1995). Section 25-2-204(1) reads as follows: \u201cA contract for the sale of goods may be made in any manner sufficient to show agreement, including conduct by both parties which recognizes the existence of such a contract.\u201d Generally, contracts formed under article 2 will also have to be supported by consideration. See N.C.G.S. \u00a7 25-1-103 (1995); Brenner v. Little Red Sch. House, Ltd., 302 N.C. 207, 215, 274 S.E.2d 206, 212 (1981).\nAWI and the Easons\u2019 conduct clearly demonstrates that they intended to enter a contract for the sale of timber. See N.C.G.S. \u00a7 25-2-204. The \u201cTimber Purchase and Sales Agreement\u201d also constitutes a writing sufficient to meet the statute of frauds requirements in N.C.G.S. \u00a7 25-2-201. See N.C.G.S. \u00a7 25-2-201 (1995). The $30,000 deposit AWI paid the Easons was consideration to guarantee AWI\u2019s rights in the Easons\u2019 timber from 10 February 1997 until 7 February 1999. See Weyerhaeuser Co. v. Carolina Power & Light Co., 257 N.C. 717, 722, 127 S.E.2d 539, 543 (1962) (noting that adequacy of consideration is generally irrelevant after consideration is found to exist). Finally, by acting in accordance with the terms in the \u201cTimber Purchase and Sales Agreement,\u201d AWI created a contract for the sale of timber. See Kidd v. Early, 289 N.C. 343, 352, 222 S.E.2d 392, 399 (1976).\nWe conclude that under the Uniform Commercial Code, AWI had a valid contract for the sale of timber. At the time Fordham removed the timber from the Easons\u2019 property, under the \u201cTimber Purchase and Sales Agreement,\u201d AWI also had the right to immediate possession of that timber. Thus, AWI meets the first requirement of a trespass to chattel cause of action.\nFordham challenges AWI\u2019s claim of possession of the Easons\u2019 timber on the grounds that AWI did not have a valid deed. However, under the Uniform Commercial Code, a deed is not required to create a contract for the sale or transfer of goods. See N.C.G.S. \u00a7 25-2-204. Thus, this argument is without merit.\nThe second element to a successful cause of action for trespass to chattel is that the defendant made an unauthorized interference or dispossession of the property. See Binder, 222 N.C. at 515, 23 S.E.2d at 896; Kirkpatrick, 178 N.C. at 350, 100 S.E. at 604; Reader, 48 N.C. at 373-74. It is undisputed that Fordham entered the Easons\u2019 property and removed timber; thus, we must only look at the agreement between Fordham and the Easons to determine if Fordham\u2019s entry onto th\u00e9 Easons\u2019 property and removal of the timber was unauthorized.\nThe agreement Fordham and the Easons entered into on 11 November 1996 allowed Fordham to cut and remove \u201call timber and pulpwood located on all lands owned by Mr. A.V. Eason and being located in Johnson County, N.C.,\u201d until 1 June 1997. This \u201cTimber Cutting Contract\u201d placed no obligation on Fordham to cut any timber, and Fordham did not pay the Easons any consideration for the right to remove the timber. Fordham agreed to pay the Easons a per-unit price for any timber removed during the life of the \u201cTimber Cutting Contract.\u201d The agreement was signed by A.V. Eason, Grace W. Eason, and Wendell Fordham in the presence of a notary public, but it was never registered in the Office of the Register of Deeds.\nThrough the \u201cTimber Cutting Contract,\u201d Fordham and the Easons attempted to create an option to purchase timber. While contracts for the sale of timber are governed by the Uniform Commercial Code and are treated as goods, an option to purchase timber is not a contract for the sale of timber. See Fisher v. Elmore, 802 F.2d 771, 773 (4th Cir. 1986) (holding that an option to purchase timber did not become a contract for the sale of timber governed by the Uniform Commercial Code until the option was exercised by harvesting the timber). North Carolina case law also distinguishes between options to purchase and contracts for the sale of goods. See Rose v. Vulcan Materials Co., 282 N.C. 643, 668, 194 S.E.2d 521, 538 (1973). Since the Uniform Commercial Code governs only contracts for the sale of timber, see N.C.G.S. \u00a7 25-2-107, an option to purchase timber is not governed by the Uniform Commercial Code. Instead, an option to purchase timber is governed by the common law. See Fisher, 802 F.2d at 773.\nAn option to purchase is an offer for which consideration has been given. See Kidd, 289 N.C. at 360, 222 S.E.2d at 404. Thus, an option is a contract itself. Id. Fordham did not give the Easons any consideration for the option to purchase timber under the \u201cTimber Cutting Contract.\u201d While, under the Uniform Commercial Code, certain option contracts can remain open without consideration, see N.C.G.S. \u00a7 25-2-205 (1995), under the common law, an option to purchase requires consideration to be enforceable, see Kidd, 289 N.C. at 360, 222 S.E.2d at 404; Brenner, 302 N.C. at 215, 274 S.E.2d at 212. The option to purchase fails because Fordham did not give the Easons any consideration for the option to purchase in the \u201cTimber Cutting Contract.\u201d See Brenner, 302 N.C. at 215, 274 S.E.2d at 212. At the time Fordham entered the Easons\u2019 property and removed the timber, he had no rights in the timber, and his entry on the property was both unauthorized and unlawful.\nOnly one party in this case, AWI, had any possessory rights in the Easons\u2019 timber. Thus, it is unnecessary to discuss the filing procedures and requirements necessary to establish superior title and to protect a contract holder\u2019s rights against subsequent purchasers and lien creditors.\nSummary judgment is appropriate when \u201cthe pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that any party is entitled to a judgment as a matter of law.\u201d N.C.G.S. \u00a7 1A-1, Rule 56(c) (1990).\nNo genuine issue of material fact exists in this cause of action for trespass to chattel. AWI owned a valid possessory interest in the subject timber on 10 February 1997 under its \u201cTimber Purchase and Sales Agreement\u201d with the Easons. Fordham has admitted intentional interference with that possessory interest by entering the property and removing the timber. As we have determined that Fordham had no valid possessory interest in the timber at the time he removed it, this intentional interference was unauthorized. Consequently, Fordham was not entitled to summary judgment on AWI\u2019s counterclaim for trespass.\nTherefore, we reverse the Court of Appeals as to AWI\u2019s counterclaim for trespass and remand this case to that court for further remand to the Superior Court, Johnston County, for such other actions as are consistent with this opinion.\nREVERSED AND REMANDED.",
        "type": "majority",
        "author": "ORR, Justice."
      }
    ],
    "attorneys": [
      "Narron, O\u2019Hale and Whittington, P.A., by Jacquelyn L. Lee, O. Hampton Whittington Jr., James W. Narron, and John P. O\u2019Hale, for plaintiff-appellee.",
      "Thomas Edward Hodges for defendant-appellant American Woodland Industries, Inc."
    ],
    "corrections": "",
    "head_matter": "WENDELL A. FORDHAM v. A.V. EASON and wife, GRACE W. EASON; and AMERICAN WOODLAND INDUSTRIES, INC.\nNo. 509PA98\n(Filed 3 December 1999)\n1. Trespass; Uniform Commercial Code\u2014 contract for sale of timber \u2014 competing claims \u2014 trespass to chattel\nTimber is classified as goods under the U.C.C., N.C.G.S. \u00a7 25-2-107(2), when it is the subject of a contract for sale. Therefore, a dispute over a trespass to timber where the claim, to a possessory interest arises under a contract for the sale of timber should be settled using a trespass to chattel analysis.\n2. Trespass\u2014 contract for timber sale \u2014 validity\u2014possessory interest \u2014 trespass to chattel\nDefendant AWI owned a sufficient possessory interest in timber under a \u201cTimber Purchase and Sales Agreement\u201d with the landowners to bring an action against plaintiff for trespass to chattel based upon plaintiffs removal of some of the timber, and plaintiff had no possessory interest in the timber pursuant to a \u201cTimber Cutting Contract\u201d with the landowners, where defendant AWI had a valid contract under the U.C.C. for the sale of timber in that its agreement with the landowners constituted a writing sufficient to meet the statute of frauds under N.C.G.S. \u00a7 25-2-201, a $30,000 deposit AWI paid the landowners was. consideration to guarantee AWI\u2019s rights in the timber, and AWI\u2019s actions in accordance with the terms of the agreement created a contract for the sale of timber; plaintiff\u2019s \u201cTimber Cutting Contract\u201d constituted only an attempt to create an option to purchase timber which failed because plaintiff did not give the landowners any consideration for the option to purchase; and plaintiff thus had no rights in the timber so that his entry onto the landowners\u2019 property and his removal of timber was unauthorized and unlawful.\nOn discretionary review pursuant to N.C.G.S. \u00a7 7A-31 of a unanimous decision of the Court of Appeals, 131 N.C. App. 226, 505 S.E.2d 895 (1998), affirming in part and reversing in part an order for summary judgment entered by Jenkins, J., on 9 October 1997 in Superior Court, Johnston County. Heard in the Supreme Court 13 September 1999.\nNarron, O\u2019Hale and Whittington, P.A., by Jacquelyn L. Lee, O. Hampton Whittington Jr., James W. Narron, and John P. O\u2019Hale, for plaintiff-appellee.\nThomas Edward Hodges for defendant-appellant American Woodland Industries, Inc."
  },
  "file_name": "0151-01",
  "first_page_order": 201,
  "last_page_order": 209
}
