UNPUBLISHED OPINION
An unpublished opinion of the North Carolina Court of Appeals does not constitute controlling legal authority. Citation is disfavored, but may be permitted in accordance with the provisions of Rule 30(e)(3) of the North Carolina Rules of Appellate Procedure.
STEPHENS, Judge.
Factual and Procedural Background
Plaintiff A.B. Cooper, Jr., initiated this matter by the filing of a complaint against Defendant Julian Everette Cameron, Jr., for breach of contract and for a declaratory judgment. The dispute between the parties arose as a result of their involvement in a coastal development project gone awry, as reflected by the trial court's findings of fact which are unchallenged by Defendant:
2. In late 2005, []Plaintiff and Defendant, along with a third individual, Ralph Webb, discussed a mutual investment for proposed high rise condominiums in Atlantic Beach, North Carolina. []Plaintiff owned some family property that was to be used for this investment opportunity. All three parties made capital contributions to acquire additional land in order to build the condominiums.
3. The parties and Webb acquired real property in their individual names in late 2005 and early 2006 in support of the condominium investment. Financing for the purchases was obtained through Wachovia Bank and [SunTrust] Bank. It was all three parties' expectations that they would recover their initial investment in the property in six months or less.
4. Because of the three parties' mutual belief at the outset of the venture as to the quick turn[-]around time as to the recovery of their respective investment, there was no discussion when the property was purchased with respect to ongoing expenses necessary for the development of the condominiums.
5. Almost immediately after the purchase of the property the investment started running into some difficulties. There was litigation necessary to obtain land required to be able to build the condominiums. There were zoning and wastewater issues [that] needed to be addressed before the property could be developed. As such, the investment started accumulating various obligations for legal fees, architectural fees, design fees, and other fees in association with the project's development.
6. []Plaintiff began paying out of pocket these development fees along with the ongoing mortgage payments on the property. []Plaintiff in February, 2006 started to invoice []Defendant and Webb their respective percentage of the fees incurred in connection with the investment based on Defendant's and Webb's respective percentage investment in the venture. []Defendant and Webb agreed to this arrangement concerning the invoicing of each party's respective share of the expenses incurred with respect to the investment and began making payments upon the respective invoices submitted to them.
7. The parties subsequent to Plaintiff's first invoicing of expenses in February 2006 formed a limited liability company for the condominiums and transferred ownership of the property to the LLC. The LLC was named "Ocean King, LLC."
8. From 2006 through 2011, []Plaintiff continued to invoice []Defendant and Webb their respective shares of the payments Plaintiff was making with respect to the Ocean King project. These payments included the payment of the ongoing indebtedness to Wachovia and Sun[Tru]st and the various other vendors and invoices as previously identified above. Both []Defendant and Webb regularly made payments on their respective invoices between 2006 and 2009, although both []Defendant and Webb began to run behind on their respective invoices so balances began to accrue on each individual's account.
9. During the time that []Plaintiff was paying these various expenses in connection with the Ocean King investment, he was also making principal curtailments on the Wachovia obligation. These principal curtailments worked to the benefit of both Ocean King and its individual investors. By paying the principal down on the obligation, the venture was charged a lesser amount of interest than it otherwise would have been charged over the life of the Wachovia loan. Thus, the individual members of Ocean King (who were also guarantors of the bank's debt) paid a lesser amount of interest over the loan's duration than they otherwise would have.
10. Neither []Defendant nor Webb ever disputed the veracity of any debt as accounted for by []Plaintiff with respect to his invoices to both men. []Plaintiff endeavored to have copies of the original vendor's invoices attached to his invoices so the other parties could determine the veracity of the obligation. Ralph Webb admitted under oath he had no reason to doubt any of []Plaintiff's accounting.
11. While []Defendant at the trial of this matter attempted to dispute one or two debts on his invoice, there is no evidence that during the long history of this relationship that []Defendant ever disputed []Plaintiff's accounting. There was evidence presented that []Defendant did not even pay attention to the invoices that []Plaintiff sent Defendant.
12. In early 2009, Ralph Webb stopped paying on his invoice because he was suffering severe financial difficulties in his business. These difficulties ultimately caused him to file bankruptcy in the fall of 2011. The effect of the bankruptcy discharged all of his debts, including his obligation to []Plaintiff.
13. []Defendant stopped paying on his invoice in November, 2009. At the time he stopped making payments, the balance []Defendant owed []Plaintiff was $103,888.95. []Plaintiff never charged either []Defendant or Webb any interest with respect to the amounts that were carried over each month on each party's respective invoice.
14. The Ocean King property went into foreclosure in 2011 when neither of the remaining members, Plaintiff or Defendant, were willing or able to continue to make the mortgage payments on the property. The lender on the property Capital Bank (who had taken over the indebtedness from Wachovia and SunTrust when those debts were refinanced with Capital Bank in 2011) has instituted an action after foreclosure against Plaintiff and Defendant to collect for an alleged deficiency owing under the deed of trust and note in connection with the Ocean King property. That action is presently pending in the Wake County Superior Court. The case is currently on appeal to the North Carolina Court of Appeals, and no final determination nor judgment has been made in the case.
15. Because of the principal curtailments made by []Plaintiff to Wachovia during the life of the Wachovia obligation, the alleged deficiency sought by Capital Bank is less than it otherwise would have been if these principal curtailments had not been made.
16. []Plaintiff has [] filed a second breach of contract claim against []Defendant in this action seeking a declaratory judgment of the parties' respective allocations of any deficiency that may ultimately be owed in connection with the Ocean King foreclosure. As no final judgment has been entered in the deficiency action, both parties acknowledge and the [trial c]ourt agrees that any disposition of []Plaintiff's second cause of action for breach of contract against Defendant cannot be adjudicated at this time.
Based upon these findings of fact, the trial court concluded, inter alia:
3. []Plaintiff has proven by the greater weight of the evidence a cause of action against []Defendant for an oral contract with []Defendant where []Defendant agreed to reimburse []Plaintiff for []Defendant's respective share of expenses incurred with respect to the Ocean King project.
4. []Defendant received a direct benefit under this contract, in that the principal curtailments made by []Plaintiff directly benefitted []Defendant both in reducing the ongoing interest payments that Ocean King paid (and that []Defendant guaranteed) and by reducing the amount of any alleged deficiency sought by the property's lender after foreclosure.
The trial court awarded Plaintiff judgment against Defendant in the amount of $103,888.95, with interest. From that judgment, which was entered 7 October 2013, Defendant appeals.
Grounds for Appellate Review
Plaintiff's complaint included two claims against Defendant, and, as the trial court noted in finding of fact 16, supra, the judgment entered 7 October 2013 was final as to only one of those claims. However, on 27 March 2014, Plaintiff voluntarily dismissed his remaining claim, and, on 23 April 2014, Defendant filed written notice of appeal from the trial court's judgment. Accordingly, no claims in this action remain pending, and the matter is properly before this Court. See Fussell v. N.C. Farm Bureau Mut. Ins. Co., 364 N.C. 222, 224-25, 695 S.E.2d 437, 439 (2010).
Discussion
Defendant argues that the trial court's findings of fact do not support its conclusions regarding the existence and terms of a contract between the parties as to reimbursement of Ocean King expenses. We disagree.
I. Standard of review
"The standard of review on appeal from a judgment entered after a non-jury trial is whether there is competent evidence to support the trial court's findings of fact and whether the findings support the conclusions of law and ensuing judgment." Cartin v. Harrison, 151 N.C. App. 697, 699, 567 S.E.2d 174, 176 (citation and internal quotation marks omitted), disc. review denied, 356 N.C. 434, 572 S.E.2d 428 (2002). "Findings of fact made by the trial judge are conclusive on appeal if supported by competent evidence, even if there is evidence to the contrary." Sisk v. Transylvania Cmty. Hosp., Inc., 364 N.C. 172, 179, 695 S.E.2d 429, 434 (citations, internal quotation marks, brackets, and ellipsis omitted), reh'g denied, 364 N.C. 442, 702 S.E.2d 65 (2010). Further, "[w]here no exception is taken to a finding of fact by the trial court, the finding is presumed to be supported by competent evidence and is binding on appeal." Koufman v. Koufman, 330 N.C. 93, 97, 408 S.E.2d 729, 731 (1991). Here, Defendant does not argue that any of the trial court's findings of fact are not supported by competent evidence,2 and accordingly, the findings of fact are binding on appeal. See id.
II. Nature of the agreement
Defendant first brings forward a number of interrelated contentions concerning the nature of the agreement between the parties: Defendant asserts that the trial court erred in concluding that an agreement existed between the parties regarding reimbursement of Ocean King expenses because its findings of fact do not identify offer and acceptance of all material terms. Specifically, Defendant asserts that finding of fact 6, in which the trial court describes the actions Plaintiff undertook regarding reimbursement and then states that "Defendant and Webb agreed to this arrangement[,]" is insufficient because the trial court did not explicitly state "that [Plaintiff] made an offer to [Defendant]" or that Defendant "orally accepted" any offer by Plaintiff. Likewise, Defendant asserts that the trial court made no finding of fact as to the terms of the agreement. Finally, Defendant contends that finding of fact 6 cannot support the conclusion that an oral contract existed because the word "agreed" in the phrase "Defendant and Webb agreed to this arrangement" "is so vague and void of detail that [it] is impossible to determine if [Defendant] entered into an oral contract [as opposed to a written or implied contract]." We are not persuaded.
A contract implied in fact, ... arises where the intention of the parties is not expressed, but an agreement in fact, creating an obligation is implied or presumed from their acts, or, as it has been otherwise stated, where there are circumstances which, according to the ordinary course of dealing and the common understanding of men, show a mutual intent to contract. An implied contract is valid and enforceable as if it were express or written. Apart from the mode of proving the fact of mutual assent, there is no difference at all in legal effect between express [contracts] and contracts implied in fact. The essence of any contract is the mutual assent of both parties to the terms of the agreement so as to establish a meeting of the minds. This mutual assent and the effectuation of the parties' intent is normally accomplished through the mechanism of offer and acceptance.... With regard to a contract implied in fact, one looks not to some express agreement, but to the actions of the parties showing an implied offer and acceptance.
Snyder v. Freeman, 300 N.C. 204, 217-18, 266 S.E.2d 593, 602 (1980) (citations, internal quotation marks, and some brackets omitted).
Here, the trial court found as fact that
[]Plaintiff began paying out of pocket these development fees along with the ongoing mortgage payments on the property. []Plaintiff in February, 2006 started to invoice []Defendant and Webb their respective percentage of the fees incurred in connection with the investment based on Defendant's and Webb's respective percentage investment in the venture. []Defendant and Webb agreed to this arrangement concerning the invoicing of each party's respective share of the expenses incurred with respect to the investment and began making payments upon the respective invoices submitted to them.
This finding establishes that the "actions of the parties show[ed] an implied offer and acceptance" of an agreement for Plaintiff to cover expenses on behalf of Defendant and Webb, invoice them for their shares, and receive reimbursements from Defendant and Webb. See id. at 218, 266 S.E.2d at 602. Further, because in general "there is no difference at all in legal effect between express [contracts] and contracts implied in fact[,]" see id. at 217, 266 S.E.2d at 602, we see no error in the trial court's description of the agreement between the parties as an oral contract rather than an implied contract in conclusion of law 3. See Eways v. Governor's Island, 326 N.C. 552, 554, 391 S.E.2d 182, 183 (1990) ("Where a trial court has reached the correct result, the judgment will not be disturbed on appeal even where a different reason is assigned to the decision.") (citations omitted). Defendant's arguments to the contrary are overruled.
III. Statute of frauds
Defendant next argues that the purported agreement between the parties is unenforceable because it violates our statute of frauds in that Plaintiff was attempting to enforce an unwritten agreement to pay the debts of "another," to wit, Ocean King. We disagree.
In support of this contention, Defendant draws this Court's attention to section 22-1 of our General Statutes, which provides:
No action shall be brought whereby to charge an executor, administrator or collector upon a special promise to answer damages out of his own estate or to charge any defendant upon a special promise to answer the debt, default or miscarriage of another person, unless the agreement upon which such action shall be brought, or some memorandum or note thereof, shall be in writing, and signed by the party charged therewith or some other person thereunto by him lawfully authorized.
N.C. Gen. Stat. § 22-1 (2013). However, the statute of frauds plainly applies only to one's promise to pay the debts of another; it is inapposite regarding the payment of one's own debts. See id. Here, the undisputed evidence, summarized in findings of fact 3, 5, 6, and 7 supra, was that the parties took out loans to purchase the real property and cover other development expenses as individuals several months before the creation of Ocean King.
Regarding any debts arising after the creation of Ocean King and appearing in that entity's name, "[t]here has been carved out an exception to [section 22-1] where the promisor has such a direct, immediate, pecuniary interest in the subject matter of the principal debtor's contract so as to indicate that the guarantor has intended to adopt the original contract as his own. This exception is known as the main purpose rule." Burlington Indus., Inc. v. Foil, 19 N.C. App. 172, 176, 198 S.E.2d 194, 197 (1973) (internal quotation marks omitted), affirmed, 284 N.C. 740, 202 S.E.2d 591 (1974). As our Supreme Court explained, under the main purpose rule,
[w]henever the main purpose and object of the promisor is not to answer for another, but to subserve some pecuniary or business purpose of his own, involving either a benefit to himself, or damage to the other contracting party, his promise is not within the statute, although it may be in form a promise to pay the debt of another, and although the performance of it may incidentally have the effect of extinguishing that liability.
Burlington Indus., Inc., 284 N.C. at 748, 202 S.E.2d at 597 (citation and internal quotation marks omitted). Here, as the trial court found and concluded, "Defendant received a direct benefit under this contract, in that the principal curtailments made by []Plaintiff directly benefitted []Defendant both in reducing the ongoing interest payments that Ocean King paid (and that []Defendant guaranteed) and by reducing the amount of any alleged deficiency sought by the property's lender after foreclosure." In sum, section 22-1 is inapplicable here. Accordingly, Defendant's arguments based upon the statute of frauds are overruled.
IV. Terms of the Ocean King operating agreement
In his final argument, Defendant contends that the trial court erred in entering judgment for Plaintiff because the terms of the Ocean King operating agreement preclude and bar Plaintiff's claim. Again, we disagree.
Defendant asserts that section 4.9 of the Ocean King operating agreement, which states, "[e]xcept as otherwise provided herein or in the [North Carolina Limited Liability Company] Act, no Interest Holder shall be liable for the debts, liabilities, contracts, or any other obligations of [Ocean King, LLC]", bars any agreement among Plaintiff, Defendant, and Webb regarding division of the development expenses. The version of the Act in effect at the time the parties entered into the operating agreement provided that, while an LLC member could not be personally liable for debts solely by reason of his position as an LLC member, he could "become personally liable by reason of [his] own acts or conduct." N.C. Gen. Stat. § 57C-3-30(a) (2006).3
Here, as noted supra, Defendant's liability did not arise solely from his position as a member of Ocean King but rather from his own acts and conduct which began before the LLC was formed and continued thereafter, to wit, permitting Plaintiff to cover development expenses and then reimbursing Plaintiff for the invoiced amounts. This argument is overruled.
The trial court's judgment in favor of Plaintiff is
AFFIRMED.
Judges GEER and DILLON concur.
Report per Rule 30(e).
