Opinion
No. COA09-491.
Filed January 19, 2010.
Wake County No. 08 CVS 15947.
Appeal by plaintiff from orders entered 25 February 2009 by Judge A. Leon Stanback, Jr. in Wake County Superior Court. Heard in the Court of Appeals 12 October 2009.
Harris, Winfield, Sarratt Hodges, LLP, by John L. Sarratt, for plaintiff-appellant. Smith, Anderson, Blount, Dorsett, Mitchell Jernigan, LLP, by Wayne K. Maiorano, and Jang H. Jo, for defendant-appellee.
Plaintiff Thomas Kucmierz appeals from the trial court's orders granting defendant Four Oaks Bank Trust Company's motions to dismiss plaintiff's complaint and denying his N.C.G.S. § 1A-1, Rule 52(a)(2) motion for findings of fact and conclusions of law. For the reasons stated, we affirm.
According to the allegations in plaintiff's complaint, in December 2005, plaintiff and Joe Locklar formed Locklar Construction, LLC, for which plaintiff served as "more of a silent partner" and Locklar managed the day-to-day operations. Since one of Locklar's responsibilities in Locklar Construction included managing "all of Locklar Construction's banking relationships," and since Locklar maintained other accounts with defendant Four Oaks Bank Trust Company ("defendant-bank"), Locklar Construction entered into a banking relationship with defendant-bank, which "eventually involved several lines of credit and deposit accounts."
During the "early phase of the relationship between Locklar Construction and [defendant-bank]," plaintiff alleges that he "had no reason to believe that there were any problems involving Locklar Construction's accounts at [defendant-bank]." Then, in August 2006, about eight months after the formation of Locklar Construction, plaintiff and Locklar visited defendant-bank and met with Ken Meyer, a representative of defendant-bank, to "generally discuss[] the account balances." During the course of this meeting, while plaintiff "was not shown the actual account information," Meyer "assured [p]laintiff that everything with the Locklar Construction accounts was fine and that nothing abnormal appeared." Plaintiff alleges that, at that meeting, Meyer promised to provide plaintiff with copies of the Locklar Construction account information, but that he did not receive the information from Meyer. Then, in October 2006, plaintiff visited defendant-bank with Locklar for a second time and met with Meyer who, once again, "assured the [p]laintiff that everything with the accounts looked normal; that he saw no problems." Plaintiff again asked Meyer for "detailed reports on Locklar Construction's bank accounts, which Mr. Meyer said he would send out right away." However, for a second time, plaintiff did not receive copies of the Locklar Construction account information from Meyer.
It was not until plaintiff spoke with another representative of defendant-bank several weeks later that plaintiff learned "there was little or no money left in any of the Locklar Construction accounts and that the lines of credit had been substantially drawn down." Plaintiff discovered that "large sums of money had been moved directly from the Locklar Construction accounts and lines of credit into Mr. Locklar's personal account and into the account of Mr. Locklar's company, Locklar Homes" — accounts which were also kept at defendant-bank. Plaintiff also learned that "funds had been transferred in substantial sums from Locklar Construction's accounts directly to gambling casino house accounts or first to other accounts controlled by Mr. Locklar and then to casinos."
On 12 September 2008, plaintiff filed a Complaint asserting the following claims for relief against defendant-bank: negligent misrepresentation; constructive fraud; breach of fiduciary duty; fraudulent concealment; and unfair or deceptive trade practices. Defendant-bank moved to dismiss plaintiff's complaint pursuant to N.C.G.S. § 1A-1, Rules 8, 9, 17, 19, 21, and 12(b)(1), (6), and (7). On 9 February 2009, the trial court heard defendant-bank's motions. After receiving notice from the court that it intended to grant defendant-bank's motions to dismiss, on 12 February 2009, plaintiff filed a motion pursuant to N.C.G.S. § 1A-1, Rule 52(a)(2) that the court make findings of fact and conclusions of law in support of its ruling on defendant-bank's motions to dismiss, and further requested that the court grant plaintiff "the opportunity to amend its complaint to cure any defect if those findings and conclusions should so warrant." On 13 February 2009, defendant filed its response to plaintiff's request for findings and conclusions. On 25 February 2009, the court entered orders granting defendant-bank's motions to dismiss, denying plaintiff's motion that the court make findings and conclusions, denying plaintiff's request to amend the complaint, and dismissing plaintiff's action with prejudice. Plaintiff gave Notice of Appeal from the trial court's orders.
"A motion to dismiss made pursuant to G.S. 1A-1, Rule 12(b)(6) tests the legal sufficiency of the complaint." Harris v. NCNB, 85 N.C. App. 669, 670, 355 S.E.2d 838, 840 (1987) (citing Sutton v. Duke, 277 N.C. 94, 176 S.E.2d 161 (1970)). "In order to withstand such a motion, the complaint must provide sufficient notice of the events and circumstances from which the claim arises, and must state allegations sufficient to satisfy the substantive elements of at least some recognized claim." Id. "When the complaint fails to allege the substantive elements of some legally cognizable claim, or where it alleges facts which defeat any claim, the complaint must be dismissed." Oberlin Capital, L.P. v. Slavin, 147 N.C. App. 52, 56, 554 S.E.2d 840, 844 (2001); see also Oates v. JAG, Inc., 314 N.C. 276, 278, 333 S.E.2d 222, 224 (1985) (providing that dismissal of a complaint under Rule 12(b)(6) is proper "(1) when the complaint on its face reveals that no law supports plaintiff's claim; (2) when the complaint reveals on its face the absence of fact sufficient to make a good claim; [or] (3) when some fact disclosed in the complaint necessarily defeats the plaintiff's claim"). When reviewing a motion to dismiss made pursuant to Rule 12(b)(6), "[t]his Court must conduct a de novo review of the pleadings to determine their legal sufficiency and to determine whether the trial court's ruling on the motion to dismiss was correct." See Leary v. N.C. Forest Prods., Inc., 157 N.C. App. 396, 400, 580 S.E.2d 1, 4, aff'd per curiam, 357 N.C. 567, 597 S.E.2d 673 (2003).
I.
Plaintiff first contends the trial court erred by dismissing plaintiff's claims of negligent misrepresentation and fraudulent concealment. We disagree.
"The tort of negligent misrepresentation occurs when a party justifiably relies to his detriment on information prepared without reasonable care by one who owed the relying party a duty of care." Raritan River Steel Co. v. Cherry, Bekaert Holland, 322 N.C. 200, 206, 367 S.E.2d 609, 612 (1988), appeal after remand, 101 N.C. App. 1, 398 S.E.2d 889 (1990), rev'd on other grounds, 329 N.C. 646, 407 S.E.2d 178 (1991). The essential elements of fraud are: "(1) [f]alse 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." See Ragsdale v. Kennedy, 286 N.C. 130, 138, 209 S.E.2d 494, 500 (1974) (emphasis added). As to claims for fraudulent concealment and negligent misrepresentation, however, "in dealing with either tort, `when the party relying on the false or misleading representation could have discovered the truth upon inquiry, the complaint must allege that he was denied the opportunity to investigate or that he could not have learned the true facts by exercise of reasonable diligence." See Oberlin Capital, 147 N.C. App. at 59, 554 S.E.2d at 846 (emphasis added) (quoting Hudson-Cole Dev. Corp. v. Beemer, 132 N.C. App. 341, 346, 511 S.E.2d 309, 313 (1999)).
Here, plaintiff admits that he "discovered the truth" after inquiring about the Locklar Construction accounts. See id. Therefore, assuming, arguendo, that Meyer's characterization of the Locklar Construction accounts as "fine" was a false or misleading representation or concealment of the status of the accounts at the time of plaintiff's inquiries, and assuming that plaintiff relied on this representation or concealment, plaintiff must have alleged that he was "denied the opportunity to investigate or that he could not have learned the true facts [about the Locklar Construction accounts] by exercise of reasonable diligence" in order to withstand defendant-bank's motions to dismiss plaintiff's claims of negligent misrepresentation and fraudulent concealment. See id.
Plaintiff alleges that, because Meyer and other representatives of defendant-bank did not timely send him the bank records he requested "that would have made it possible for [p]laintiff to learn about [Locklar's] transfers himself," he was effectively denied the opportunity to investigate the matter and "had no choice but to, and did, rely entirely upon bank representatives who assured [p]laintiff that everything with the Locklar Construction account was fine." Plaintiff also suggests that he exercised reasonable diligence in his attempts to learn the "true facts" about the Locklar Construction accounts by "repeated[ly]" requesting the account information from defendant-bank's representatives. However, plaintiff alleges that, when Meyer did not respond to plaintiff's request for information about the Locklar Construction accounts in August 2006, he did not contact Meyer or any other representative of defendant-bank to inquire about the status of his request until October 2006. Having received no response to this request for several weeks, plaintiff contacted another representative of defendant-bank, learned that Meyer was no longer employed by defendant-bank, and received the documents "within a couple of business days" after requesting them. Thus, the allegations show that plaintiff was not denied the opportunity to investigate the matter, and that the delay in obtaining the information resulted from his failure to exercise reasonable diligence by making only two requests for the information over a three-or four-month period. Therefore, "[b]ecause the complaint fails to allege that [plaintiff] was denied the opportunity to investigate or that [plaintiff] could not have learned the true facts by exercise of reasonable diligence, the complaint fails to state causes of action for fraudulent concealment and negligent misrepresentation." See Oberlin Capital, 147 N.C. App. at 60, 554 S.E.2d at 847. Accordingly, we overrule these assignments of error.
II.
Plaintiff next contends the trial court erred by dismissing plaintiff's claim of breach of fiduciary duty. Again, we disagree.
"A fiduciary duty arises when there has been a special confidence reposed in one who in equity and good conscience is bound to act in good faith and with due regard to the interests of the one reposing confidence." Branch Banking Trust Co. v. Thompson, 107 N.C. App. 53, 60, 418 S.E.2d 694, 699 (internal quotation marks omitted), disc. review denied, 332 N.C. 482, 421 S.E.2d 350 (1992). "However, an ordinary debtor-creditor relationship generally does not give rise to such a special confidence: [t]he mere existence of a debtor-creditor relationship between [the parties does] not create a fiduciary relationship." Id. at 61, 418 S.E.2d at 699 (alterations in original) (internal quotation marks omitted). Nevertheless, this Court has noted that "[t]his is not to say . . . that a bank-customer relationship will never give rise to a fiduciary relationship given the proper circumstances." Id. (emphasis added).
In the present case, plaintiff alleges that he put a "special trust and faith" in defendant-bank as a result of his two in-person meetings with defendant-bank's representative Meyer. As we noted above, at his first meeting with Meyer in August 2006, plaintiff alleges that he, Meyer, and Locklar "generally discussed the [Locklar Construction] account balances" and that Meyer "assured [p]laintiff that everything with the Locklar Construction accounts was fine and that nothing abnormal appeared." At his second meeting with Meyer in October 2006, plaintiff alleges that Meyer again "assured [him] that everything with the accounts looked normal; that he saw no problems." However, we hold that the two meetings between plaintiff, Locklar, and defendant-bank's representative to "generally discuss[]" the status of the Locklar Construction accounts are not sufficient to support plaintiff's claim that a fiduciary relationship existed between plaintiff and defendant-bank. Since plaintiff failed to allege facts which establish the existence of a relationship beyond that of an ordinary debtor-creditor relationship between plaintiff and defendant-bank, we overrule this assignment of error.
III.
Plaintiff next contends the trial court erred by dismissing plaintiff's claim for constructive fraud. Again, we must disagree.
"A constructive fraud complaint must allege facts and circumstances (1) which created the relation of trust and confidence, and (2) led up to and surrounded the consummation of the transaction in which defendant is alleged to have taken advantage of his position of trust to the hurt of plaintiff." Hunter v. Guardian Life Ins. Co. of Am., 162 N.C. App. 477, 482, 593 S.E.2d 595, 599 (internal quotation marks omitted), disc. reviews denied, 358 N.C. 543, 599 S.E.2d 48-49 (2004). "Put simply, a plaintiff must show (1) the existence of a fiduciary duty, and (2) a breach of that duty" in order to succeed on a claim for constructive fraud. See id. (internal quotation marks omitted). Since we have already concluded that plaintiff failed to allege facts which establish that a fiduciary relationship existed between him and defendant-bank, we must conclude that plaintiff has also failed to sufficiently allege facts to support the essential elements of the claim of constructive fraud. Accordingly, we overrule this assignment of error.
IV.
Plaintiff next contends the trial court erred by dismissing plaintiff's claim of unfair or deceptive trade practices. However, in support of this contention, plaintiff asserts only, "[h]aving established that the Complaint sets forth the essential elements for constructive fraud, breach of fiduciary duty, and fraud, nothing more needs to be said to also establish that a claim is asserted under [N.C.G.S. §] 75.1-1." In other words, plaintiff supports this assignment of error by relying on the presumed success of the other arguments in his brief, which this Court has concluded have failed. Therefore, since plaintiff provides no argument in support of this assignment of error, we deem that plaintiff has abandoned his appeal from the trial court's dismissal of his claim of unfair or deceptive trade practices. See N.C.R. App. P. 28(b)(6).
Since we have determined that plaintiff failed to allege the substantive elements of his claims of negligent misrepresentation, constructive fraud, breach of fiduciary duty, and fraudulent concealment, we hold the trial court properly dismissed plaintiff's complaint on these claims pursuant to Rule 12(b)(6). Accordingly, although defendant-bank moved to dismiss plaintiff's claims pursuant to other North Carolina Rules of Civil Procedure, we need not consider any other grounds for the court's dismissal of these claims.
V.
Finally, plaintiff contends the trial court erred by denying his N.C.G.S. § 1A-1, Rule 52(a)(2) motion that the trial court make findings of fact and conclusions of law in support of its ruling on defendant-bank's motions to dismiss. We disagree.
Rule 52(a)(2) of the North Carolina Rules of Civil Procedure provides, in part, that "[f]indings of fact and conclusions of law are necessary on decisions of any motion . . . only when requested by a party. . . ." See N.C. Gen. Stat. § 1A-1, Rule 52(a)(2) (2009). "Thus, the trial court's compliance with [a] party's Rule 52(a)(2) motion is mandatory." Andrews v. Peters, 75 N.C. App. 252, 258, 330 S.E.2d 638, 642, disc. review denied, 315 N.C. 182, 337 S.E.2d 65 (1985), aff'd, 318 N.C. 133, 347 S.E.2d 409 (1986), aff'd after remand, 89 N.C. App. 315, 365 S.E.2d 709 (1988).
In the present case, plaintiff timely filed his Rule 52(a)(2) motion on 12 February 2009 before the trial court entered its order granting defendant-bank's motions to dismiss on 25 February 2009. Although the trial court should have made findings of fact and conclusions of law as requested by plaintiff under Rule 52(a)(2), "because we review a dismissal for failure to state a claim de novo, we would have disregarded any findings of fact or conclusions of law drafted by the trial court." See Helm v. Appalachian State Univ., ___ N.C. App. ___, ___, 670 S.E.2d 571, 578 (2008), rev'd per curiam on other grounds, 363 N.C. 366, 677 S.E.2d 454 (2009). Accordingly, we hold plaintiff was not prejudiced by the trial court's denial of plaintiff's motion to make findings of fact and conclusions of law pursuant to Rule 52(a)(2), and this assignment of error is overruled.
Affirmed.
Judges JACKSON and ERVIN concur.
Report per Rule 30(e).