NC Civil Procedure

NC Civil Procedure

Subject Matter Jurisdiction
the power of the court to hear the case, its nonviable, any party or court on its own motion at anytime can raise it.
NC Subject Matter Jurisdiction
Federal Courts are courts of limited jurisdiction. There are many limitations placed on the types of cases federal courts can hear. North Carolina courts are courts of general jurisdiction. North Carolina State courts can hear almost all cases, except cases over which the federal courts have exclusive jurisdiction.
Appellate Court Jurisdiction
In NC, parties have an appeal of right in

1) Cases in which there is a dissent int he NC COA’s
2) Cases in which there is a substantial constitutional question (state or federal)
3) Cases involving rate making proceedings in utilities matters
4) Death Penalty Cases

NC Court of Appeals
Hears cases relating to:

1) Superior and district courts
2) Insurance rates cases
3) Adminsitrative Agencies
4) Workers Compensation
5) NC State Bar cases

Jurisdiction of Trial Courts in NC
There are 2 types of SMJ for the NC trial courts:

1) Exclusive jurisdiction: these are matters over which the particular trial court has sole jurisdiction, matter must be brought to that court
2) Proper jurisdiction: these are matters in which this court is the preferred jurisdiction court to hear the matter. If no one objects, the non-preferred trial court will hear the matter. If a party objects, it gets transferred to the proper court.

Trial Court #1: Superior Court
2 Types of Jurisdiction

1) Exclusive Jurisdiction over probate matters
2) Proper Jurisdiction in a) civil actions in excess of $25,000 for cases after Aug 2013, previously was $10K
b) injunctive relief/declaratory judgment action (usually when the validity of a statute or administrator of a trust)

Trial Court #2: District Court
1) Exclusive Jurisdiction: juvenile matters
2) Proper Jurisdiction for a) civil actions for $25,000 or less pre Aug 2013, was 10K or less b) family law matters (divorce, alimony, equitable distribution, support, custody, etc) c) traffic matters (and misdemeanors in criminal and civil cases)

There is no jury trial in this court for criminal cases. Appeal is for trial de novo to Superior Court. This is where the right to jury trial is preserved.

Magistrate Court (Small Claims)
The court is a subdivision of District Court. This court handles civil actions that do not exceed $10,000.
Personal Jurisdiction
PJ is the power of the court to adjudicate the rights and liabilities of the defendant. Especially out of state defendants. This is waivable. It can be waived by contract, prior to a lawsuit being filed, or failure to timely raise it as a defense. PJ is only an issue with out of state D’s. The forum court has power over defendants that are citizens of the forum state. All about the nexus to the state.
Non Minimum contact analysis
there are several ways to have PJ over a nonresident defendant without having to expressly utilize a minimum contracts due process analysis. These proxies include the following:

1) Waiver: if the defendant has substantially participated on the merits, the NC courts deem the defendant to have waived PJ objections
2) Consent or Contract: can be express or implied
3) Physical presence (transitory jurisdiction)
4) Corporations “doing business” in NC: foreign corps, including out of state corps that have substantial and continuous activity in the state, are doing business such that the corporation is “essentially at home” and subject to general jurisdiction. This means they are subject to PJ in the state for all matters, related or unrelated to their business activity in the state.

NC Long Arm Statute
State where you can sue under certain circumstances. Does the state expressly authorize PJ over this out of state defendant. The NC statute includes the following:

a) Acts or omissions in NC causing injury to person to property in NC
b) Acts or omissions outside of NC causing injury in NC provided that the defendant carried on some activity here or introduced goods into the ordinary flow of commerce.
c) Acts arising out of contracts to provide services in NC
d) Acts arising out of contracts to ship goods to or from NC
e) Acts arising from contracts of insurance where the plaintiff was a resident of NC when the claim arose
f) Acts arising out of contracts of insurance with event causing loss occurred in NC
g) If a NC statute provides additional specific grounds for PJ

**basically, as long as it satisfies due process, long arm statute is interpreted broadly

Service of Process
-Formal notice of a lawsuit
-Service = method used
-Process = copy of the complaint and summons (signed by clerk)
-Scope: service of process not only serves to obtain PJ as previously discussed, but it also serves as the matter in which notice is provided to D
Who may serve in NC?
In state: generally the sheriff or authorized person
Out of State: a person 21 or older who is not a party or anyone duly authorized to serve in the place where the service is to take place
When service must occur?
Service must be made within 60 days after the issuance of the summons. There is an exception.
No Service
When service will not be timely effectuated the action can be continued in existence for a total of 90 days. this can be extremely important when there is a possibility of the SOL’s running out. Even if the action was timely filed and service is not made on the defendant, without extension, action is terminated.
2 Renewal Methods for Service
1) Endorsement: P may secure an endorsement on the original summons for an extension of time to complete service. (Not favored approach)
2) Alias or Pluries Summons: the clerk issues an alias summons to extend the action 90 days and can be repeatedly indefinitely as long as you move again.

Either of these methods may be employed within 90 days of the last extension.

Service on Minors
Service on a minor occurs in the manner prescribed for service on natural persons and minors parent (custodial) or guardian
Service on people adjudicated as incompetent
Service on people adjudicated as incompetent occurs in the manner prescribed for service on natural persons AND on the incompetent person’s guardian
Service on Partnerships
Service on a partnership can occur by service on the general partner, attorney in fact or authorized agent in the manner described for corporations
Service on nonresident motorists
This can be accomplished by serving the commissioner of motor vehicles
Service on a Foreign Country
Service is permitted under any internationally agreed means reasonably calculated to give notice, look at rules and treaties. If there is no treaty, NCRCP 4(j)(3) has several alternative means available
Service on Government
These are special rules for who is to be served
Service by Publication
Disfavored in NC, for lazy P’s. Any defect in service of process by publication is jurisdictional, rendering any judgment obtained without compliance with the rule in service in this manner void. You can serve in this manner only when: a party with due diligence cannot be reached or by delivery service, P needs to use all resources reasonably available
Venue means location. The right to have the case tried in the proper venue is substantial one, but in practice it generally is not jurisdictional. Under federal law, venue is found in districts. In NC, it is based on counties
2 Types of Venue
1) Of Right: venue of right is waivable. It is a NCRCP 12(b)(3) defense. Thus if you do not raise it in your first response, you lose it. NCRCP 12(b) authorizes the court to dismiss for improper venue but that ruling is rare. Instead, the routine practice is to transfer the case to the proper venue. Since the right to venue is a substantial one, denial of a motion to remove or dismiss for improper venue as of right is immediately appealable.
2) Discretionary: denial of a motion for discretionary change of venue is interlocutory and not immediately appealable.
Determining Venue
Venue is ordinarily determined in NC by domicile of the parties. Unless otherwise provided for by statute, the proper venue is:

1) In the county in which any of the P’s or any of the D’s reside at the time of the commencement of the action OR
2) If none of the D’s reside in the state, in the county where any of the P’s reside OR
3) If none of the parties reside, then in the county designated in the Summons & Complaint

Venue for Corporations
1) Domestic Corporation: the residence of a domestic (NC) corporation for venue purposes is the location of where its registered or principal office
2) Domesticated Corporation: a foreign corporation domesticated in NC is treated like a domestic corporation
3) Foreign Corporation: Venue is appropriate for foreign corporations a) county where claim arose, b) in the county whose corporation usually did business or has property or 3) where a P resides in these cases
Special Proper Venue Situations
1) The proper venue is where the subject of the action is situated when: it is an action for a) recovery of real property or estate; b) the determination of rights occurs in those situations or c) for injury to real property
2) The proper venue is where the action arose when a) its a recovery of penalties by statute OR b) for actions against public officials
Objections to Venue
Once an objection is properly asserted for improper venue as of right, the court is without authority to proceed further with: any essential matters in the case. The discretionary removal of a civil action to an adjacent county can occur when: 1) grounds to believe no fair trial 2) convenience of the witnesses
Venue Simplified
1) Venue lies in any county where a party resides P or D. Corporations, domestic and domesticated, are residents of a county where the corporation: a) has a registered office; b) has a principal office; or c) maintains its place of business. Domestic corporations versus domesticated corporation: domestic is in NC, domesticated is foreign corporation but has NC office and registered with secretary of state.
2) If no one resides in NC, then venue lies int he county names by the complaint or summons
Exceptions By Statute
1) If the action involves penalties and forfeitures imposed by statute or actions against public officials, then venue lies where action arose.
2) In actions on bonds: a) official bonds (executors, administrators)–venue lies where bond is given, b) construction bonds–venue is where primary contract is performed
C) In actions against railroads, venue lies in the county where cause of action arose or P resided at the time
-Pleadings provide notice and fair warning and clarify the nature of a lawsuit
-Pleadings include:

1) complaint (which includes not only the original complaint and any amended complaint of the P but also cross claims)
2) Answer (which may include a counterclaim)
3) Reply to counterclaim OR affirmative defense
4) Answer to counterclaims
5) Third Party Complaint
6) Third Party Answers
7) Reply alleging last clear chance when the answer alleges contributory negligence

Complaint (or other claim)
NC is a notice pleading state. Requirement: “A short and plain statement of the claim sufficiently particular to give the court and parties notice of the transactions, occurrences, or series of transactions or occurrences…”
A party has 30 days to file an answer or pre answer motion under Rule 12 (NC). If a party filed a rule 12 pre answer motion, it will have 20 days after the court provides notice that it has ruled on the motion or postponed its disposition of the motion, to file an answer.
Sworn statement like an affidavit that you can rely on. Most actions in NC do not require verification. The most common complaints that require verification are those for 1) divorce and child support and 2) shareholder derivative action suits *no verification = subject to dismissal
Affirmative Defenses
Need only be alleged in the answer. There are no special pleading requirements for affirmative defenses other than they are affirmative alleged. Ex) Accord, satisfaction, duress, latches, SOF, SOL, estoppel, res judicator etc.
Rule 11 Requirements
Protects against frivolous lawsuits. 1) profile inquiry and 2) proper purpose for this suit. NC has the earlier version of the FRCP Rule 11.

NC Rule 11 requires that: every pleading, motion or paper of a party represented by an attorney must be signed by the attorney or pro se D. Signing certifies 1) signor saying i’ve read it 2) that to best information and belief after a reasonable inquiry the pleading or motion is well grounded in fact and 3) warranted by existing law or good faith argument for the extension, modification or reversal of existing law and 4) is not interposed for any improper purpose. Failure to sign the pleading will cause the pleading, motion or paper to be stricken. False certification under Rule 11 makes the violator subject to sanctions, which can include striking claim or defenses and attorney fees

Demand for Relief in NC Courts
All claims must include a demand for relief. Except court won’t modify default judgments.
Pleading Special Matters
There are certain matters that require more than the general NC notice pleading requirements. Must have particularity. Those matters requiring special pleading include:

1) Fraud, duress, or mistake
2) Special Damages: natural, not necessary consequence of D’s wrong doing
3) Punitive damages (NCRCP 9(k)): A demand for punitive damages shall be specifically state and the aggravating factor (malice, fraud, or willful, wanton conduct) that supports the award of punitive damages shall be averred with particularity (NC has a cap on punitive)
4) Medical Malpractice (NCRCP 9(j): A party must allege one of the following a) specific assertion that the medical care has been reviewed by a person who is reasonably expected to qualify as an expert under NCRE 702 and is willing to testify medical care wasn’t up to proper standard or b) specific assertion that the party will seek to have the expert qualified by superior court judge and will testify or c) the case is based on res ipsa loquitur. Experts in NC: be specialist in area who was licensed and practiced the year before, now a dauber state with majority, must be based on reliable methods and applied reliably
5) Foreign Law (NCRCP 44.1): a party who intends to raise an issue concerning the law of a foreign country: must plead and prove law
6) capacity to sue: any party not a natural person or suing in a representative capacity must allege affirmatively its legal existence and capacity or authority to sue. It can rebutted but they must raise this in the pleadings

Time (NCRCP Rule 6)
1) First Day: doesn’t count
2) Last Day: in computing the period of time within which to respond to a pleading, motion, etc., if the last day falls on a Saturday, Sunday or legal holiday go to the next business day
3) Less than Seven (7) days to reply: if the period of time within which a response is required is less than seven (7) days, then you don’t count intervening Saturdays or Sundays or holidays
Rule 12 Motions and Defenses
NCRCP 12, like the federal rules of civil procedure, lists several defenses that may be raised by motion.

Motions: for More Definite Statement (NCRCP 12(e)), Motion to Strike (NCRCP 12(f)), and Motion for Judgment on the Pleadings (NCRCP (12(c))–after the pleadings are closed, this motion can be made if: there are no real material issues of fact and both P & D can raise it

Rule 12(b) Defenses (NCRCP 12(b))
The 7 defenses listed in this rule may be raised either as a defense or in the answer or

1) lack of SMJ
2) Lack of PJ
3) Improper Venue
4) Insufficiency of Process-documents
5) Insufficiency of Service
6) Failure to state a claim upon which relief can be granted
7) Failure to join a necessary party

Rule 12(b)(6) Failure to State a Claim Upon which Relief can be Granted
Most common defense. You are basically raising one of two issues with this defense: 1) Either that the allegations of the claim, even if taken as true, do not state a legal cause of action because they are missing some of the necessary allegations, such as an element, or 2) if they state a cause of action, its not recognized in NC. Watch out if the court considers matters outside of the pleadings, the motion shall be treated as one for motion for summary judgment.
Pleading Amendments
There are 3 ways to amend a pleading.

1) “Once as Matter of Course”
2) With written consent of adverse party
3) By the leave of court, which “shall be freely given when justice so requires”

Pleading amendments are not always granted

Amendments and Relation Back (NCRCP 15(c))–Can Amendments Occur After the SOL has run?
NC distinction: NC allows relation back of claims only, unlike the federal rules, which also allowed the relation back of parties as well.

Rule: A claim asserted in the amended pleading may relate back to the date of the original pleading if the original pleading gave notice of the transactions, occurrences, or series of transactions or occurrences contained in the amended pleading. Its a notice question.

About parties or claims
Joinder of Parties (NCRCP 19 and 20)
1) Intervention (NCRCP 24): where party wants to join case voluntarily, party waives objections to PJ
a) of right: when statutes give that right or b) anyone who claims an interest related to the property or transaction who may have their interest impaired or otherwise will not be able to protect their interest
b) Permissive: when a statute gives a conditional right to the intervenor or when an intervenor has a question of law or fact common to the suit
2) Interpleader: State (NCRCP 22) and Federal (Statutory Interpleader and FRCP Rule 22 Interpleader)–where D is acting as P, wants to bring all P’s together. Basic point: interpleader essentially permits a party facing conflicting claims to bring all of the claimants under the roof of a single case.
3) Impleader (NCRCP 14): way for D to take control of case, add involuntarily. A defendant party may sue 3rd party D’s who are or may be liable to the D (now also 3rd party P) for: all or part of the claim, indemnification (party is responsible for all of claim, contribution (part responsibility)
Joinder of Claims (NCRCP 18)
A party can bring as many claims as it has against an opposing party once the party first complies with the rules on cross-claims and 3rd party claims
Class Actions (NCRCP 23)
Factors Considered:

1) A class exists
2) A class is too numerous for joinder
3) Class remembers within jurisdiction of the court are representative those outside the jurisdiction
4) The party/parties representing the class must fairly insure the representation of all class members
5) Adequate notice to member and
6) Class members share an interest in common

Scope of Discovery (NCRCP 26(b))
1) Prerequisite: relevant to the subject matter and not privileged. Also includes ESI, discovery includes accessible meta data.
2) Work Product (“in anticipation of litigation or preparation for trial”): protects mental strategies and tactics of attorneys
3) What is the NC test for work product material: sole purpose test–if work product sole purpose is gathering strategies and tactics usually protected
4 Types of Work Product
a) Attorney’s (or his/her representatives) mental impressions, conclusions, opinions or legal theories. Absolutely protected.
b) Documents and Tangible Objects: have a different standard, discoverable if showing a substantial need and undue hardship in getting docs
c) A Party’s Own Statements: party or W is entitled to own statements
1) Testifying Experts (Testifying Work Product Experts): experts who develop facts and opinions in anticipation of litigation or in preparation for trial and are expected to testify at trial. In NC, if a party inquires about an expert by interrogatories, the receiving party must provide experts name, subject matter, opinion and rationale, if more discovery sought must get permission.
2) Non-testifying experts (Non-testifying Work Product Experts): these are experts who were formally or informally consulted in anticipation of litigation or preparation for trial but will not be testifying at trial. In NC, even the identity of the non testifying expert is not discoverable.
3) Actor/viewer experts (Non-Work Product Experts): these are witnesses who may be expert witnesses but also are participants in the transactions or occurrences that are a part of the subject matter of the lawsuit. Ex–a doctor on a train accident, treated as regular witnesses
Signing of Discovery Papers (NCRCP 26(g))
This requirement is similar to Rule 11. The rule requires all discovery requests, responses or objections be signed by one attorney of record or pro se litigant.
Interrogatories (NCRCP 33)
Served on parties. Limit of 50 to a party unless leave of court for good cause shown or agreement of the other party.
Depositions (NCRCP 30-32)
May be taken of parties and non parties. Nonparties may be compelled to attend by subpoena. Parties only require: notice of deposition, can be used substantial and impeached deposition taken in county where they reside, work or 50 miles of services.
Production of Documents and Things and Entry Upon Land (NCRCP 34)
This device may be served on another party. In order to get documents and things from a nonparty requires a subpoena duces cecum (NCRCP 45(c))
Physical and Mental Examination of Persons (NCRCP 35)
The physical or mental condition of a party, agent of a party, person in the custody or under legal control of a party may be examined if: its in controversy in the case and good cause shown.
Requests for Admission (NCRCP 36)
Narrows issues for trial. There are 30 days to respond to a Request for Admission. Failure to respond is deemed an admission.
Pretrial Conferences with the Trial Judge (NCRCP 16)
In NC, the holding of a pretrial conference generally occurs no later than 7 days before trial. Matters typically considered include: amendments to the pleadings, simplification of the issues, entering into admissions and stipulations as to facts, and the admissibility of documents, matters for judicial notice and the limitation of expert witnesses.
Default Judgments (NCRCP 55)
Apply to all claims, counter, cross and 3rd party claims. Note: a default judgment may not exceed the relief sought in the pleadings or vary in kind (NCRCP 54(c)) because of due process
NCRCP 12(b)(6) Motions
Not available until pleadings have closed
Judgment on the Pleadings (NCRCP 12(c))
This device is similar to a rule 12(b)(6) motion. The primary difference is not available until pleadings have closed. It also has been used to test the sufficiency of a defense.
Voluntary Dismissal (NCRCP 41(a))
1) Filed when? At any time prior to P resting her case
2) A device that saves more lawsuits than any other and can be entered into unilaterally by P
3) Differences Between the federal and state rules: A major difference is that the NC rule allows for dismissal without anyone’s permission (the court or other counsel) at any time before the P rests his/her case)
4) The dismissal is without prejudice unless the P has previously dismissed the claim in any other court. If the original action was timely filed, the P will get at least 1 year to refile, even if the statute of limitations has run since the case was originally filed.
5) The rule also applies to the dismissal of: counter claims, crossclaims or 3rd party claims
6) When does P “rest her case?” A P rests her case by when P participates in a summary judgment hearing then they’ll need to consent to voluntary dismissal a) compulsory counterclaims: if an opposing party has a compulsory counterclaim against the parking seeking dismissal without consent then the rule doesn’t allow a dismissal without consent
Involuntary Dismissal (NCRCP 41(b))
This is a dismissal with prejudice unless the dismissal order specifies otherwise. If the P 1) fails to prosecute his/her claim or 2) obey an order of court
a) “With Prejudice” Exceptions exist -lack of jurisdiction; improper venue or failure to join a necessary party
Summary Judgment (NCRCP 56)
This is the primary device to flush out frivolous claims between the pleading stage and the trial. The standard for granting summary judgment is–there is no genuine issue of material fact and any party is entitled to judgment as a matter of law. This is the same standard as the federal rule, except that it is not limited to the moving party. Either party can win here. Also, affidavits should be: depositions, interrogatories, admissions.
Right to Jury
The right to a jury trial at the time the NC constitution was adopted is preserved to those cases in which the prerogative existed at common law. It is waivable. A demand for a jury trial must be made in writing and within 10 days after service of the last pleading directed to that issue (NCRCP 38(b). It’s available to all D’s and cross claimants.
Challenges to Jurors
1) For Cause: These are challenges for which, as the name suggests, have a reason, 1) juror not fair or 2) not qualified, unlimited # of challenges
2) Peremptory Challenges: these are challenges for which no basis need be given can’t violate EPC. 8 challenges. Multiple defendants then 6 each.
Directed Verdict Motions (NCRCP 50(a))
A directed verdict is similar to a motion for summary judgment except: made after presentation of evidence at trial.
1) When made. It may first be made by the D after the P has rested his/her case. it may be renewed by the D at end of all evidence. The P may also make a motion for a directed verdict after the D has had an opportunity to present evidence.
2) Standard. The standard that the trial judge applies when deciding on the motion is: sufficiency of the evidence (enough evidence to get to jury?) This means that if the evidence is insufficient to justify a verdict as a matter of law for the nonmoving party–i.e., the nonmoving party did not present enough evidence to create a jury question–then trial judge should grant motion.
Judgment Notwithstanding the Verdict (JNOV) (NCRCP 50(b))
This is a renewed directed verdict motion after verdict rendered. It must be made within 10 days of the entry of judgment.
Motion for New Trial (NCRCP 59)
This motion may be joined with a motion for JNOV (NCRCP 50(c)). Trial judge can determine if needed. The motion must be served no later than 10 days after the entry of judgment.

Grounds? Misconduct, newly discovered evidence, errors in trial (of evidentiary trial) etc.

Jury Instructions
The trial judge in NC gives the jury instructions. Counsel must object to the instructions with specificity.
Judicial Comment on the Evidence
The judge is not allowed to comment on the evidence.
General Verdict
Where jury asks who wins and if P wins what are the damages
Special Verdicts
When judge gives jury specific questions to answer, then judge applies the law
General Verdicts with Special Findings of Fact
1) Jury gives general verdict of who wins and 2) answers specific questions

Note: If the special findings of fact are inconsistent with the general verdict, the special findings control

Notice of Appeal
A party has 30 days from entry of judgment to file a notice of appeal. The notice must be filed with the clerk of the superior court and copies served on all other parties. If a party has filed a Motion for New Trial, a JNOV, to amend findings of fact under NCRCP 52 or to alter or amend a judgment under NCRCP 59, then the time for appeal begins to run from the entry of the order on the motion
What is appealable?
1) Final Judgments
2) Interlocutory Judgments
3) On Appeal
Final Judgments
Final judgments are ones that dispose of the entire case as to all claims and parties. Final judgments are immediately appealable. Judgments upon multiple parties or claims–when a court enters judgment on fewer than all of the claims or fewer than all of the parties, the court may enter on those parties or claims.
Interlocutory Judgments
These are not final and not appealable.

Exception: some interlocutory judgments may be immediately appealable. 1) rulings that affect a substantial right of a party. These rulings are also immediately appealable. The test for substantial right is easier stated than applied. A substantial right is affected when it will clearly be lost or irremediably adversely affected if the order is not reviewable before final judgment.

Examples of permissible appeals because of a substantial right was affected: a) denial of a motion to dismiss lack of PJ, b) denial of a motion to dismiss for failing to have brought the claim as a compulsory counterclaim in a previous action c) denial of motion to change venue as of right d) grant of a new trial on a legal question

On Appeal
On appeal must the appellant state each ground for appeal as an assignment of error? NO
NC Statute of Limitations
Times run from date of injury or when injury is discovered. Statute of repose–date of when an act occurs
Times of SOL
a) Defamation: 1 year from the date of publication
b) Wrongful death: 2 years from the date of death
c) Professional negligence: 3 years from the date of the last act of D that gave rise to the claim
d) Fraud and mistake (including negligent misrepresentation): 3 Years from the date of facts constituting the fraud or mistake or the facts should have been discovered in the exercise of due diligence
e) Negligence actions generally: 3 years from the date of injury
f) Intentional torts: 3 years
g) Conversion: 3 years
h) Trespass upon real property: 3 years. In cases of continuous trespass, from date of the original trespass.
i) Contract: 3 years from date of breach
j) Claims for loss covered by an insurance policy: 3 years generally
l) Unfair and deceptive trade practices: 4 years from date of violation
m) Contracts governed by the UCC: 4 years
n) Contracts under seal: 10 years against the principals. If the contract is filed, a counterclaim arising from the same transaction also gets the 10 year statute even if it would otherwise have had a shorter statute
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