Opinion
No. COA10-886
Filed 7 June 2011 This case not for publication
Appeal by plaintiff from judgment entered 26 March 2010 by Judge Wendy M. Enochs in Guilford County District Court. Heard in the Court of Appeals 13 December 2010.
Hatfield Hatfield, by Kathryn K. Hatfield, for the Plaintiff. The Law Offices of John W. Kirkman, Jr., by John W. Kirkman, Jr. and Salem M. Thacker, for the Defendant.
Guilford County No. 09 CVD 11346.
Plaintiff Vonda W. Moorefield appeals from an order entered by the trial court concluding that a Separation Agreement signed by the parties on 30 January 1990 remained in full force and effect and that this Separation Agreement barred the equitable distribution and alimony claims that Plaintiff had asserted against Defendant David H. Moorefield. On appeal, Plaintiff contends that the trial court erred by holding that her challenge to the Separation Agreement was time-barred; refusing to set aside the Separation Agreement on the grounds of unconscionability, fraud, duress, or undue influence; and failing to conclude that the Separation Agreement had been rescinded by a subsequent written agreement between the parties. After careful consideration of Plaintiff's challenges to the trial court's order in light of the record and the applicable law, we conclude that the trial court's order should be affirmed.
I. Factual Background
After marrying on 14 February 1987, the parties separated. On 30 January 1990, they executed a Separation Agreement that provided for a full and complete distribution of the parties' marital and divisible property. As evidence of that fact, the Separation Agreement stated that:
Satisfaction of [N.C. Gen. Stat. § ] 50-20 []
The parties agree that this Agreement has fully provided for distribution between the parties of all marital property of the parties and that the division agreed to herein is fair, reasonable and equitable and satisfactory to each party. Accordingly, each party accepts the provision for him or her in full and final settlement and satisfaction of any and all claims and rights that either may have against the other for equitable distribution under [N. C. Gen. Stat. §§ ] 50-20 and 50-21 as the same may be amended from time to time and the property divided herein among the parties shall remain and be the separate property of each party receiving said property.
In addition, the Separation Agreement contained a release of the parties' rights to seek and obtain temporary and permanent alimony. Finally, the Separation Agreement stated that:
Reconciliation Effect
In the event of reconciliation between the parties and resumption of their marital relationship, the provisions of this Deed of Separation for settlement of property rights shall nevertheless continue in full force and effect unless the parties shall by written agreement, duly executed by each of them after the date of reconciliation, decide otherwise and by a new agreement.
Approximately one year after the execution of the Separation Agreement, the parties reconciled and resumed their marital relationship. In the years following the execution of the Separation Agreement and their initial separation and reconciliation, the parties separated and reconciled approximately four more times.
On 14 December 2001, the parties entered into a Postmarital Agreement. The parties subsequently executed a Nullification of Postmarital Agreement on 20 June 2002. Neither the Postmarital Agreement nor the Nullification of Postmarital Agreement made any reference to the 1990 Separation Agreement.
The parties separated for a final time on 25 April 2009. On 1 September 2009, Plaintiff filed a complaint in Guilford County District Court in which she requested that the Separation Agreement be set aside and that she be awarded postseparation support, alimony, and an equitable distribution of the parties' marital and divisible property. On 17 November 2009, Defendant filed an answer in which he alleged, among other things, that the Separation Agreement barred Plaintiff's claims for equitable distribution and postseparation support and alimony. In addition, Defendant asserted a counterclaim seeking a declaration that the "Separation Agreement executed by Plaintiff and Defendant on January 30, 1990 is valid and in full force and effect." In a reply filed on 12 January 2010, Plaintiff asked the trial court to refrain from making the declaration requested in Defendant's counterclaim.
In addition, Defendant requested the trial court to resolve custody and support issues relating to a child born after the execution of the 1990 Separation Agreement. A careful examination of the record provides no indication that these custody and support claims have been resolved, thereby rendering the trial court's order interlocutory rather than final. McConnell v. McConnell, 151 N.C. App. 622, 624, 566 S.E.2d 801, 803 (2002) (holding that an appeal taken from a custody and support order that failed to address a party's alimony and equitable distribution claims had been taken from an unappealable interlocutory order because "the order appealed from [did] not resolve all of the parties' claims arising out of th[e] action"). Although we would ordinarily dismiss Plaintiff's appeal on our own motion, Yordy v. N.C. Farm Bureau Mut. Ins. Co., 149 N.C. App. 230, 230-31, 560 S.E.2d 384, 385 (2002) (stating that "`[i]t is well established in this jurisdiction that if an appealing party has no right of appeal, an appellate court on its own motion should dismiss the appeal even though the question of appealability has not been raised by the parties themselves'") (quoting Bailey v. Gooding, 301 N.C. 205, 208, 270 S.E.2d 431, 433 (1980)), we elect to treat the record and the parties' briefs as a petition for the issuance of a writ of certiorari pursuant to N.C.R. App. P. 21(a)(1), to grant the petition, and to review Plaintiff's challenge to the trial court's order on the merits, Anderson v. Hollifield, 345 N.C. 480, 482, 480 S.E.2d 661, 663 (1997) (stating that "we conclude that Rule 21(a)(1) gives an appellate court the authority to review the merits of an appeal by [ certiorari] even if the party has failed to file notice of appeal in a timely manner), given that the issues before us in this case have little or no relation to the unresolved custody and support issues and our belief that addressing Plaintiff's claims will facilitate the more efficient resolution of the dispute between the parties.
Defendant's motion for declaratory judgment came on for hearing before the trial court at the 23 March 2010 session of the Guilford County District Court. On 26 March 2010, after hearing the evidence and the arguments of counsel, the trial court entered an order containing findings of fact and conclusions of law and granting Defendant's motion for declaratory judgment based on a determination that Plaintiff's challenge to the enforceability of the Separation Agreement was barred by the applicable statute of limitations. In addition, given its determination that the Separation Agreement was valid and remained in full force and effect, the trial court found that Plaintiff was "barred from pursuing an Equitable Distribution claim." Plaintiff noted an appeal to this Court from the trial court's order.
Although the trial court's order does not make any reference to Plaintiff's claim for postseparation support and alimony, the effect of the trial court's decision to uphold the validity of the Separation Agreement is to preclude Plaintiff from asserting her spousal support claims as well. Perry v. Perry, 33 N.C. App. 139, 142, 234 S.E.2d 449, 452 (stating that "the provisions of a valid separation agreement relating to marital and property rights of the parties cannot be ignored or set aside by the court[s]"), cert. denied, 292 N.C. 730, 235 S.E.2d 784 (1977). As a result, we conclude that, taken in context, the trial court's order has the effect of barring Plaintiff's claim for postseparation support and alimony as well as her claim for equitable distribution.
II. Legal Analysis
On appeal, Plaintiff argues that the trial court erred by granting Defendant's motion for declaratory judgment on statute of limitations grounds. More specifically, Plaintiff contends that the trial court erred by concluding that Plaintiff's attempt to challenge the enforceability of the Separation Agreement as unconscionable or as having been procured by fraud, duress, or undue influence was not time-barred because those claims accrued as of the filing of her complaint rather than at some earlier date. Although a separation agreement, like any other contract, "is not enforceable if it is `unconscionable or procured by duress, coercion, or fraud,'" Dawbarn v. Dawbarn, 175 N.C. App. 712, 716, 625 S.E.2d 186, 190 (2006) (quoting Knight v. Knight, 76 N.C. App. 395, 398, 333 S.E.2d 331, 333 (1985)), we conclude that Plaintiff is precluded from asserting those claims in this case by the applicable statute of limitations.
Although the parties discuss a number of different limitations periods in their briefs and although the trial court did not identify the exact limitations period that it deemed applicable in this instance, we need not determine the applicable statute of limitations either, since Plaintiff appears to acknowledge that her claims would be time-barred regardless of whether one utilized the ten year statute of limitations applicable to actions brought in reliance upon a sealed instrument set out in N.C. Gen. Stat. § 1-47(2), the three year statute of limitations applicable to actions for fraud, duress, or undue influence set out in N.C. Gen. Stat. § 1-52(9), or some other limitations period unless her claims were deemed to have accrued as of the date upon which she filed her complaint. As a result, we express no opinion as to the identity of the limitations period actually applicable to this case.
"`Generally, whether a cause of action is barred by the statute of limitations is a mixed question of law and fact.'" Scott Jones, Inc. v. Carlton Ins. Agency, Inc., 196 N.C. App. 290, 293, 677 S.E.2d 848, 850 (2009) (quoting Rowell v. N.C. Equip. Co., 146 N.C. App. 431, 434, 552 S.E.2d 274, 276 (2001)). However, in situations, such as this one, "`where the statute of limitations is properly pled and the facts are not in conflict, the issue becomes a matter of law[.]'" Id. (quoting Rowell, 146 N.C. App. at 434, 552 S.E.2d at 276). As a result, we review the provisions of the trial court's order applying and enforcing the statute of limitations using a de novo standard of review. Taylor v. Hospice of Henderson Cty., Inc., 194 N.C. App. 179, 184, 668 S.E.2d 923, 926 (2008) (citation omitted).
"A cause of action generally accrues and the statute of limitations begins to run as soon as the right to institute and maintain a suit arises." Penley v. Penley, 314 N.C. 1, 20, 332 S.E.2d 51, 62 (1985) (citations omitted). As a general proposition, claims for relief predicated upon alleged "duress, undue influence and fraud accrue[] upon discovery by the aggrieved party of the facts constituting the fraud." Dawbarn, 175 N.C. App. at 717, 625 S.E.2d at 190. "Courts in this jurisdiction have interpreted this language to mean that the `cause of action accrues when the wrong is complete, even though the injured party did not then know the wrong had been committed.'" Id. (quoting Davis v. Wrenn, 121 N.C. App. 156, 158-59, 464 S.E.2d 708, 710 (1995), cert. denied, 343 N.C. 305, 471 S.E.2d 69 (1996), overruled on other grounds by Forbis v. Neal, 361 N.C. 519, 524, 649 S.E.2d 382, 385-86 (2007); and citing Baars v. Campbell Univ., Inc., 148 N.C. App. 408, 417-18, 558 S.E.2d 871, 876 (treating the date upon which a deed was executed and recorded as the date upon which a party obtained the knowledge necessary to initiate the running of the limitations period applicable to an undue influence claim), disc. review denied, 355 N.C. 490, 563 S.E.2d 563 (2002); Biesecker v. Biesecker, 62 N.C. App. 282, 286, 302 S.E.2d 826, 829 (1983) (holding that a cause of action predicated on alleged duress arose when a husband threatened the wife with physical violence unless she signed a deed)). As a result, Plaintiff's challenge to the enforceability of the Separation Agreement accrued as of the date upon which she knew, or reasonably should have known, of the fact upon which her challenge is predicated, a determination which means, as Plaintiff implicitly concedes, that her claims are time-barred.
Similarly, although we have not found any reported decision directly on point, one could conclude, by analogy, that an unconscionability claim accrues when the party knows or reasonably should have known of the existence of the allegedly unconscionable contract or contractual provision.
On appeal, Plaintiff has not argued that she obtained the information upon which her unconscionability, fraud, duress, or undue influence claims are predicated after the date upon which the applicable statute of limitations had run. Instead, Plaintiff contends that her claims against Defendant did not accrue until she breached the Separation Agreement by filing suit against Defendant for the purpose of seeking to have the Separation Agreement set aside, postseparation support and alimony, and equitable distribution. In seeking to persuade us of the validity of this argument, Plaintiff points to our recent decision in Dillingham v. Dillingham, ___ N.C. App. ___, ___, 688 S.E.2d 499, 506 (2010), in which we held that the statute of limitations applicable to resulting trust claims did not accrue "until the party asserting a resulting trust has notice that the other party is `claiming the subject property adversely to them[,]'" Id. (quoting Brisson v. Williams, 82 N.C. App. 53, 61, 345 S.E.2d 432, 437, disc. review denied, 318 N.C. 691, 350 S.E.2d 857 (1986)); argues that the cases upon which Defendant relies did not involve "a challenge to a comprehensive separation agreement that had been raised as a bar to equitable distribution involving relinquishment of future rights"; and contends that this Court should hold, consistently with N.C. Gen. Stat. § 52B-9 (providing that "[a]ny statute of limitations applicable to an action asserting a claim for relief under a premarital agreement is tolled during the marriage of the parties to the agreement") and decisions such as Miller v. Miller, 983 A.2d 736, 742 (Pa. Super. 2009) (stating that "[w]e need not even scrutinize the relevant time frame because, in the case of continuing contracts, such as postnuptial agreements, where the duties of the parties are ongoing, the statute of limitations generally does not run'") (quoting Crispo v. Crispo, 909 A.2d 308, 315 (Pa. Super 2006)), review denied, 998 A.2d 961 (2010), that the statute of limitations did not begin to run until she filed her complaint. We do not find these arguments persuasive.
Although Plaintiff has correctly described the applicable legal principles governing the date upon which a claim for breach of a resulting trust occurs, the principles described in Dillingham have no application to this case because neither party has asserted a claim stemming from the alleged existence of a resulting trust. Furthermore, we disagree with Plaintiff's contention that the instruments at issue in Dawbarn, 175 N.C. App. at 713-17, 625 S.E.2d at 188-90 (holding that the statute of limitations applicable to claims for fraud, duress and undue influence arising from the execution of an agreement between a husband and a wife involving the transfer of certain items of real property to the wife in her individual capacity accrued at the time that the parties executed the challenged instrument), and Calhoun v. Calhoun, 18 N.C. App. 429, 432, 197 S.E.2d 83, 85 (1973) (holding that a challenge to the validity of a deed of separation on the grounds of fraud accrued on the date the parties executed the challenged instrument), are materially different from the Separation Agreement. Although the instruments under consideration in these cases differ from each other and from the Separation Agreement in certain respects, all of these instruments involve "[c]ontracts between husband and wife not inconsistent with public policy" which "release and quitclaim such rights which they might respectively acquire or may have acquired by marriage in the property of each other[.]" N.C. Gen. Stat. § 52-10(a). As a result, we are not persuaded that Plaintiff's attempt to distinguish Dawbarn and Calhoun from the facts of this case based on the exact contents of each agreement has merit. Finally, since there is controlling North Carolina authority that appears to be materially indistinguishable from the present case, In re Appeal of Civil Penalty, 324 N.C. 373, 384, 379 S.E.2d 30, 37 (1989) (stating that, "[w]here a panel of the Court of Appeals has decided the same issue, albeit in a different case, a subsequent panel of the same court is bound by that precedent"), we need not decide this case by analogy to N.C. Gen. Stat. § 52B-9 or relying on the logic of the out-of-state decisions upon which Plaintiff relies, such as Miller. Thus, none of Plaintiff's arguments in opposition to the trial court's determination that Plaintiff's challenges to the Separation Agreement are time-barred have any merit. In light of our decision to affirm the trial court's decision with respect to the statute of limitations issue, we need not address Defendant's argument that the trial court's order erroneously failed to conclude that the Separation Agreement was unconscionable or obtained as the result of fraud, duress, or undue influence. Dawbarn, 175 N.C. App. at 717, 625 S.E.2d at 191 (explaining that the Court need not analyze the plaintiff's unconscionability claim given its determination that the procedural portion of her unconscionability claim was barred by the applicable statute of limitations).
A fundamental problem with Plaintiff's argument is that it misapprehends the manner in which Defendant has sought to use the Separation Agreement in this case. Although Plaintiff suggests that the filing of her complaint constituted a breach of the Separation Agreement and that Defendant had filed suit to enforce it, the reality of the situation is that Plaintiff is claiming that, because of the unconscionability of its provisions and the fact that the Separation Agreement was procured by fraud, duress, and undue influence, the Separation Agreement was never effective. Gardner v. Insurance Co., 163 N.C. 295, 330, 79 S.E. 806, 808 (1913). Defendant did not file a claim against Plaintiff for breach of the Separation Agreement; instead, he simply pled the Separation Agreement as a bar to Plaintiff's claims and argued that it foreclosed Plaintiff's postseparation support, alimony, and equitable distribution claims. Price v. Askins, 212 N.C. 583, 587, 194 S.E. 284, 286-87 (1937). As a result, the present case revolves around Plaintiff's challenge to the Separation Agreement's validity rather than any attempt on Defendant's part to assert a substantive claim in reliance on that instrument.
III. Conclusion
Thus, for the reasons set forth above, we conclude that the trial court did not err by declaring that the Separation Agreement remained valid and enforceable and that it barred Plaintiff's equitable distribution claim. As a result, the trial court's order should be, and hereby is, affirmed.
In her brief, Plaintiff requests that we "hold that the 1990 Separation Agreement was terminated by a subsequent agreement of the parties in 2001 which comprehensively disposed of the same property as the 1990 agreement." According to Plaintiff, "[t]he 2001 agreement was itself nullified by agreement in 2002, leaving the parties without an agreement that disposed of their property." Plaintiff acknowledges, however, that she did not properly preserve this issue for appellate review because she failed to present her argument to the trial court. N.C.R. App. P. 10(a)(1) (stating that, "[i]n order to preserve an issue for appellate review, a party must have presented to the trial court a timely request, objection, or motion, stating the specific grounds for the ruling the party desired the court to make if the specific grounds were not apparent from the context"). For that reason, Plaintiff urges us to consider this issue on the merits pursuant to N.C.R. App. P. 2 (stating that, "[t]o prevent manifest injustice to a party, or to expedite decision in the public interest, either court of the appellate division may, except as otherwise expressly provided by these rules, suspend or vary the requirements or provisions of any of these rules in a case pending before it upon application of a party or upon its own initiative, and may order proceedings in accordance with its directions"). We decline Plaintiff's invitation given the absence of the "`exceptional circumstances'" usually necessary to justify the invocation of N.C.R. App. P. 2. State v. Hart, 361 N.C. 309, 315-17, 644 S.E.2d 201, 205-206 (2007) (quoting Steingress v. Steingress, 350 N.C. 64, 66, 511 S.E.2d 298, 299-300 (1999)).
AFFIRMED.
Chief Judge MARTIN and JUDGE MCGEE concur.
Report per Rule 30(e).