Akshar Distribution Co. v. Smoky's Mart ( 2020 )

IN THE COURT OF APPEALS OF NORTH CAROLINA
No. COA19-316
Filed: 7 January 2020
Guilford County, No. 17 CvS 4421
AKSHAR DISTRIBUTION COMPANY, d/b/a THE GREENSBORO DISCOUNTS,
Plaintiff,
v.
SMOKY’S MART INC., and UMESH RAMANI, Defendants.
Appeal by Defendants from orders entered 21 March 2018 by Judge Patrice A.
Hinnant and 3 December 2018 by Judge R. Stuart Albright, both in Guilford County
Superior Court. Heard in the Court of Appeals 1 October 2019.
Brooks, Pierce, McLendon, Humphrey & Leonard, L.L.P., by Matthew B.
Tynan, Clint S. Morse, and Kimberly M. Marston, for Plaintiff-Appellee.
Hill Evans Jordan & Beatty, PLLC, by R. Thompson Wright, for Defendants-
Appellants.
COLLINS, Judge.
Defendants Smoky’s Mart Inc. and Umesh Ramani appeal from the trial court’s
(1) 21 March 2018 order granting Plaintiff Akshar Distribution Company’s motion for
sanctions filed pursuant to N.C. Gen. Stat. § 1A-1, Rule 37, in which the trial court
entered default judgment for treble damages against Defendants, and (2) 3 December
2018 order denying Defendants’ motion for reconsideration or a new hearing
regarding Plaintiff’s motion for sanctions filed pursuant to N.C. Gen. Stat. § 1A-1,
AKSHAR DISTRIB. CO. V. SMOKY’S
Opinion of the Court
Rules 54 and 59. Defendants contend that the trial court (1) erred by entering default
judgment against Defendants for treble damages in the 21 March 2018 order and
(2) abused its discretion by denying Defendants’ N.C. Gen. Stat. § 1A-1, Rule 591
motion in the 3 December 2018 order. We dismiss Defendants’ appeal from the 21
March 2018 order, vacate the trial court’s 3 December 2018 order, and deny
Defendants’ Rule 59 motion.
I. Background
Plaintiff Akshar Distribution Company is a wholesale distributor for
convenience stores. At the time relevant to Plaintiff’s allegations, Defendant Umesh
Ramani was a minority shareholder of Plaintiff.
According to the first amended complaint, Ramani also owns Defendant
Smoky’s Mart Inc. (“Smoky’s,” or collectively with Ramani, “Defendants”), which
operates a convenience store in Greensboro. Smoky’s purchased inventory from
Plaintiff at various times between December 2014 and January 2017. Although
Plaintiff invoiced Smoky’s for the merchandise, Smoky’s never paid the invoices,
which totaled $30,040.09.
1 Because Defendants characterize their motion for reconsideration or a new hearing as a “Rule
59 motion” in their briefs on appeal and Defendants do not make any arguments based upon N.C. Gen.
Stat. § 1A-1, Rule 54 (“Rule 54”) in their briefs, Defendants have abandoned any argument that the
trial court erred by denying their purported Rule 54 motion, and we analyze Defendants’ motion under
N.C. Gen. Stat. § 1A-1, Rule 59 (“Rule 59”) alone. N.C. R. App. P. 28(b)(6) (“Issues not presented in a
party’s brief, or in support of which no reason or argument is stated, will be taken as abandoned.”).
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On 28 March 2017, Plaintiff filed a complaint against Smoky’s in connection
with the unpaid invoices. On 28 April 2017, Plaintiff filed its first amended
complaint, adding allegations that Ramani had misappropriated Plaintiff’s funds for
his and Smoky’s use in the collective amount of $125,981.55 between March 2014 and
April 2016. Plaintiff’s first amended complaint brought the following causes of action:
(1) action for the price of goods purchased pursuant to N.C. Gen. Stat. § 25-2-
709(1)(a), against Smoky’s; (2) breach of contract, against Smoky’s; (3) unjust
enrichment, against Smoky’s; (4) conversion, against Defendants; (5) breach of
fiduciary duty, against Ramani; (6) unfair and deceptive trade practices pursuant to
N.C. Gen. Stat. § 75-1.1, against Defendants; and (7) action to impose a constructive
trust, against Ramani.
Defendants answered the first amended complaint on 6 July 2017. In their
answer, Defendants (1) admitted that Smoky’s owed Plaintiff for the unpaid invoices,
(2) denied that Ramani had misappropriated Plaintiff’s funds, and (3) raised a
number of affirmative defenses.
On 31 July 2017, the trial court entered an order scheduling discovery,
pursuant to the consent of the parties. The parties exchanged discovery over the
following months. On 18 December 2017, Plaintiff filed a motion to compel discovery
pursuant to N.C. Gen. Stat. § 1A-1, Rule 37 (“Rule 37”), arguing that Defendants had
insufficiently responded to Plaintiff’s discovery requests. On 16 January 2018, the
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trial court entered a consent order compelling Defendants to respond to Plaintiff’s
requests.
Plaintiff filed a motion for sanctions pursuant to Rule 37 on 12 February 2018,
alleging that Defendants had continued to fail to comply with the trial court’s orders
governing discovery. Plaintiff’s motion for sanctions came on for hearing on 8 March
2018. Defendants did not attend the hearing.
On 21 March 2018, the trial court entered an order granting Plaintiff’s motion
for sanctions. In the 21 March 2018 order, the trial court: (1) found that Defendants
had unjustifiably failed to comply with its orders governing discovery; (2) concluded
that Defendants were in contempt of its orders governing discovery; (3) “conclude[d]
that sanctions less severe than striking Defendants’ answer and entering partial
summary judgment for Plaintiff[] would not be adequate given the seriousness of
[Defendants’] misconduct”; (4) struck Defendants’ answer; (5) entered default
judgment for Plaintiff on all claims brought in the first amended complaint, notably
including Plaintiff’s claim for unfair and deceptive trade practices, and therefore
trebled its damage awards pursuant to N.C. Gen. Stat. § 75-16 to total $90,147.27
from Defendants jointly and severally (for the unpaid invoices) and $377,944.65 from
Ramani (for the allegedly misappropriated funds); and (6) ordered Defendants to pay
Plaintiff’s expenses in connection with preparing, filing, and arguing the motion for
sanctions. Noting that it had also granted Plaintiff’s motion to file a second amended
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complaint the same day adding other defendants and causes of action to the lawsuit,
the trial court also certified the default judgment as a final judgment pursuant to
Rule 54(b).
On 3 April 2018, Defendants filed a motion for reconsideration or a new
hearing pursuant to Rules 54 and 59. In their Rule 59 motion,2 Defendants moved
the trial court to set aside its 21 March 2018 order granting Plaintiff’s motion for
sanctions because (1) Defendants did not have certain documents the trial court had
ordered they produce to Plaintiff until 2 April 2018 and (2) Defendants’ counsel
missed the 8 March 2018 hearing on Plaintiff’s motion for sanctions due to a
calendaring mistake. Defendants attached affidavits to the motion providing
supporting factual details regarding the bases for their Rule 59 motion. Defendants’
motion came on for hearing on 3 December 2018. On that date, the trial court denied
Defendants’ Rule 59 motion.
Defendants noticed appeal from both the 21 March 2018 and 3 December 2018
orders on 2 January 2019.
II. Appellate Jurisdiction
Plaintiff argues that because Defendants did not notice their appeal from the
21 March 2018 order until 2 January 2019, Defendants failed to timely notice appeal
from that order, and we accordingly lack jurisdiction to consider Defendants’
2 As noted above, we analyze Defendants’ 3 April 2018 motion under Rule 59 alone. See supra
note 1.
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arguments regarding that order. Defendants counter that their 3 April 2018 Rule 59
motion was timely filed within 10 days following the entry of the 21 March 2018 order,
and that Defendants’ period to appeal from that order was accordingly tolled
pursuant to North Carolina Rule of Appellate Procedure 3 (“Appellate Rule 3”) until
after the entry of an order disposing of the motion. Because they appealed from the
21 March 2018 order on 2 January 2019—within 30 days following the 3 December
2018 entry of the order denying their Rule 59 motion—Defendants argue that their
notice of appeal from the 21 March 2018 order was timely.
Appellate Rule 3 says that “if a timely motion is made by any party for relief
under Rules 50(b), 52(b) or 59 of the Rules of Civil Procedure, the thirty-day period
for taking appeal is tolled as to all parties until entry of an order disposing of the
motion[.]” N.C. R. App. P. 3(c)(3) (2018). But merely invoking Rule 59 within the
motion is not sufficient to toll the period for taking appeal from an order under
Appellate Rule 3. This Court has said:
To qualify as a Rule 59 motion within the meaning of Rule
3 of the Rules of Appellate Procedure, the motion must
“state the grounds therefor” and the grounds stated must
be among those listed in Rule 59(a). The mere recitation of
the rule number relied upon by the movant is not a
statement of the grounds within the meaning of [N.C. Gen.
Stat. § 1A-1,] Rule 7(b)(1). The motion, to satisfy the
requirements of Rule 7(b)(1), must supply information
revealing the basis of the motion.
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Smith v. Johnson, 125 N.C. App. 603, 606, 481 S.E.2d 415, 417 (1997) (internal
citations omitted). This Court has also said:
In analyzing the sufficiency of a motion made pursuant to
N.C. Gen. Stat. § 1A-1, Rule 59, one should keep in mind
that a failure to give the number of the rule under which a
motion is made is not necessarily fatal, if the grounds for
the motion and the relief sought is consistent with the
Rules of Civil Procedure. As long as the face of the motion
reveals, and the Clerk and the parties clearly understand,
the relief sought and the grounds asserted and as long as
an opponent is not prejudiced, a motion complies with the
requirements of N.C. Gen. Stat. § 1A-1, Rule 7(b)(1).
Batlle v. Sabates, 198 N.C. App. 407, 413, 681 S.E.2d 788, 793-94 (2009) (internal
quotation marks, brackets, and citations omitted). The essence of the inquiry, then,
is “to ascertain whether [the movant] stated a valid basis for seeking to obtain relief
pursuant to N.C. Gen. Stat. § 1A-1, Rule 59.” Id. at 414, 681 S.E.2d at 794. The
parties disagree over whether Defendants’ Rule 59 motion stated a valid basis
thereunder.
Generally, Rule 59 is applicable only where there has been a trial. See Ennis
v. Munn, No. COA12-1349, 2013 N.C. App. LEXIS 977, at *11 (unpublished) (N.C. Ct.
App. Sept. 17, 2013) (noting that this Court has reasoned that “Rule 59 applies only
to judgments resulting from trials”). There has been no trial in this case. But some
decisions from this Court have stated in dicta that Rule 59 may be a viable avenue to
attack non-trial judgments, including default judgments entered as Rule 37
sanctions. See Smith, 125 N.C. App. at 606, 481 S.E.2d at 417 (“[T]he defendants
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indicate in the[ir purported Rule 59] motion that they rely on Rule 59(a)(2) & (7) as
the bases of their motion. . . . It appears that the motion is merely a request that the
trial court reconsider its earlier decision granting the sanction and although this may
properly be treated as a Rule 59(e) motion, it cannot be used as a means to reargue
matters already argued or to put forth arguments which were not made but could
have been made.” (internal citation omitted)); Batlle, 198 N.C. App. at 413 n.1, 681
S.E.2d at 793 n.1 (noting that Smith “appears to assume that relief under N.C. Gen.
Stat. § 1A-1, Rule 59, is, at least in theory, available to individuals who have been
sanctioned for discovery violations”). Accordingly, we will assume that Defendants’
motion is a technically-proper Rule 59 motion for purposes of our analysis.
As mentioned above, the gravamen of Defendants’ Rule 59 motion is that
(1) Defendants did not have certain bank records the trial court had ordered they
produce to Plaintiff until 2 April 2018 and (2) Defendants’ counsel missed the 8 March
2018 hearing on Plaintiff’s motion for sanctions due to a calendaring mistake.
Defendants supported their Rule 59 motion with affidavits providing relevant
supporting factual details. Defendants did not specify the Rule 59(a) subsections
upon which their motion is based within the text of the motion, but the Batlle Court
said that this deficiency is not dispositive of the inquiry so long as the grounds
asserted are clear and Plaintiff was not prejudiced thereby. Id.
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Defendants argued in their motion that the lack of documents and the
calendaring mistake comprise “circumstances [which] constitute mistake,
inadvertence, surprise and excusable neglect, and constitute an irregularity by which
defendants Smoky’s and Ramani were prevented from having a fair hearing on the
Motion for Sanctions[.]” While it also speaks in terms not found within Rule 59—and
instead closely tracks language from N.C. Gen. Stat. § 1A-1, Rule 60 (contemplating
relief from final judgment based upon “[m]istake, inadvertence, surprise, or excusable
neglect”)—Defendants’ motion tracks the language of Rule 59(a)(1) (contemplating
new trial based upon “[a]ny irregularity by which any party was prevented from
having a fair trial”) and speaks in terms resonant with Rule 59(a)(3) (contemplating
new trial based upon “[a]ccident or surprise which ordinary prudence could not have
guarded against”). Because Defendants’ motion speaks in language tracking text
found within Rule 59(a)(1) and (3), and the grounds asserted in the motion are
supported by relevant factual details contained within the affidavits, we conclude
that Defendants’ motion was sufficiently clear to put Plaintiff on notice of the bases
for the motion, and that Plaintiff accordingly was not prejudiced thereby.
Having determined that Defendant’s motion was technically proper and
sufficiently revealed the bases for the motion, the question remains whether the
motion stated valid Rule 59 bases for relief. A Rule 59 motion does not have to be
meritorious in order to fall within Appellate Rule 3’s ambit, but rather must only
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state a “potentially valid basis for an award of relief.” Batlle, 198 N.C. App. at 418
n.4, 681 S.E.2d at 796 n.4 (“The fact that Plaintiff alleged a valid ground for relief
from the . . . order in her . . . motion does not, of course, mean that her argument is
substantively valid. At this stage, our inquiry is limited to the issue of whether
Plaintiff has adequately stated a potentially valid basis for an award of relief. The
extent to which Plaintiff is actually entitled to relief on the basis of this claim or is
subject to sanctions for advancing it are entirely different issues . . . .”). For the same
reasons we conclude that Defendants sufficiently revealed the bases for their motion,
we conclude that Defendants stated potentially-valid bases for an award of relief from
the trial court’s discovery sanction within the meaning of Rule 59.
In sum, although it could have been more artfully drafted, we conclude that
Defendants timely made a Rule 59 motion within the meaning of Appellate Rule 3.
Accordingly, Defendants’ period to notice appeal from the 21 March 2018 order was
tolled by Appellate Rule 3(c)(3) until at least 30 days following the 3 December 2018
entry of the order denying Defendants’ Rule 59 motion. Because Defendants noticed
their appeal from the 21 March 2018 and 3 December 2018 orders within 30 days of
entry of the 3 December 2018 order, Defendants’ appeals from both orders were
timely under Appellate Rule 3, and we have jurisdiction to consider both appeals.
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III. Discussion
Defendants contend that the trial court (1) erred by entering default judgment
against Defendants for treble damages in the 21 March 2018 order on Plaintiff’s
motion for sanctions and (2) abused its discretion by denying Defendants’ Rule 59
motion for reconsideration or a new hearing in the 3 December 2018 order. We
address the two orders in turn.
a. Plaintiff’s Motion for Sanctions
Under Rule 37, a trial court may sanction a party’s failure to comply with its
order to provide or permit discovery in a number of enumerated ways, including by
entering “[a]n order striking out pleadings or parts thereof, or . . . rendering a
judgment by default against the disobedient party[.]” N.C. Gen. Stat. § 1A-1, Rule
37(b)(2)(c) (2018).
Defendants argue that the trial court erred in its 21 March 2018 order by
entering default judgment against them because the first amended complaint fails to
state a claim for unfair and deceptive trade practices within the meaning of N.C. Gen.
Stat. § 75-1.1, and liability under Section 75-1.1 was the statutory predicate for the
treble-damage awards the trial court entered pursuant to N.C. Gen. Stat. § 75-16.
However, Defendants did not move the trial court to set aside the default judgment
pursuant to N.C. Gen. Stat. § 1A-1, Rules 55(d) or 60(b). This Court has said that the
failure to attack a default judgment at the trial court precludes an attack on the
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default judgment on appeal. Golmon v. Latham, 183 N.C. App. 150, 151-52, 643
S.E.2d 625, 626 (2007); see Collins v. N.C. State Highway & Pub. Works Comm’n, 237
N.C. 277, 284, 74 S.E.2d 709, 715 (1953) (“To set aside a judgment for irregularity it
is necessary to make a motion in the cause before the court which rendered the
judgment, with notice to the other party; the objection cannot be made by appeal, or
an independent action, or by collateral attack.” (quotation marks and citation
omitted)). As the Golmon Court said: “Defendants should have first filed a motion
pursuant to N.C.R. Civ. P. 55(d) or 60(b). They would then have been able to appeal
to this Court from any denial of that motion. Because defendants failed to follow this
procedure, we are precluded from reviewing the issues they raise.” Golmon, 183 N.C.
App. at 152, 643 S.E.2d at 626.
Defendants did seek to have the 21 March 2018 order—including the default
judgment entered therein—set aside in its entirety in their Rule 59 motion. And as
discussed above in Section II, there is some authority that a litigant may seek relief
from Rule 37 sanctions via Rule 59. See Smith, 125 N.C. App. at 606, 481 S.E.2d at
417. However, Defendants’ Rule 59 motion raised factual circumstances as the bases
for the relief sought, and Defendants did not argue in that motion (or elsewhere
below) that the default judgment should be set aside because the first amended
complaint fails to state a claim under N.C. Gen. Stat. § 75-1.1. Defendants’ argument
is therefore made for the first time on appeal, which our Appellate Rules expressly
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prohibit. N.C. R. App. P. 10(a)(1) (“In 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. It is also necessary for the
complaining party to obtain a ruling upon the party’s request, objection, or motion.”);
Grier v. Guy, 224 N.C. App. 256, 260-62, 741 S.E.2d 338, 342-43 (2012) (dismissing
argument on appeal that default judgment should be set aside because complaint
failed to state a claim because the argument was not made to the trial court).
Because Defendants did not attack the default judgment at the trial court on
the basis that the first amended complaint failed to state a claim under N.C. Gen.
Stat. § 75-1.1, they are precluded from making that argument on appeal.
b. Defendants’ Motion for Reconsideration or a New Hearing
Defendants also argue that the trial court abused its discretion by denying
their Rule 59 motion in its 3 December 2018 order.
In this case, the parties acknowledge that Judge Hinnant—who entered the
21 March 2018 order whose reconsideration Defendants sought in their 3 April 2018
Rule 59 motion—retired from the bench before the Rule 59 motion came on for
hearing on 3 December 2018. Plaintiff argues, despite the fact that Defendants filed
their Rule 59 motion in April 2018, that Judge Hinnant’s subsequent retirement
rendered Defendants’ Rule 59 motion unreviewable, and that Judge Albright—who
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entered the 3 December 2018 order denying Defendants’ Rule 59 motion—properly
denied that motion accordingly.
This Court has held that a trial judge who did not preside at trial lacks
jurisdiction to rule on a Rule 59 motion for a new trial. Sisk v. Sisk, 221 N.C. App.
631, 636-37, 729 S.E.2d 68, 72-73 (2012), disc. review denied, 366 N.C. 571, 738 S.E.2d
368 (2013). The same rationale—that “[o]ne superior court judge may not overrule
another[,]” Able Outdoor, Inc. v. Harrelson, 341 N.C. 167, 169, 459 S.E.2d 626, 627
(1995)—applies here. Judge Albright therefore should have dismissed Defendants’
Rule 59 motion, and erred by denying it. See Quevedo-Woolf v. Overholser, 820 S.E.2d
817, 840 (N.C. Ct. App. 2018) (vacating order: “Because Judge Randolph lacked
subject matter jurisdiction to hear Plaintiff’s Rule 59 motion, the Randolph Order is
void.”), disc. review denied, 372 N.C. 359, 828 S.E.2d 164 (2019); In re J.T., 363 N.C.
1, 3, 672 S.E.2d 17, 18 (2009) (“[T]he proceedings of a court without jurisdiction of the
subject matter are a nullity. When the record clearly shows that subject matter
jurisdiction is lacking, the court will take notice and dismiss the action ex mero motu
in order to avoid exceeding its authority.” (quotation marks, brackets, and citations
omitted)).
However, where the trial judge who entered the judgment from which a litigant
seeks relief pursuant to Rule 59 leaves the bench, thereby rendering the judgment
unreviewable by another trial judge, our Supreme Court has said that “justice
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requires that [the] defendant be afforded an opportunity to have considered on appeal
any asserted errors of law which he contends entitles him to a new trial.” Hoots v.
Calaway, 282 N.C. 477, 490, 193 S.E.2d 709, 717 (1973). The task of reviewing
Defendants’ Rule 59 motion therefore falls upon us. See Gemini Drilling & Found.,
LLC v. Nat’l Fire Ins. Co. of Hartford, 192 N.C. App. 376, 390, 665 S.E.2d 505, 514
(2008) (“[I]t is not appropriate for a superior court judge who did not try a case to rule
upon a motion for a new trial, and in that situation, an appellate court should conduct
the review of errors to determine if the party is entitled to a new trial.”). Because we
are not reviewing any decision of a lower court, we necessarily review Defendants’
Rule 59 motion de novo. Sisk, 221 N.C. App. at 631, 729 S.E.2d at 70.
As a threshold matter, as discussed above in Section III(a), Defendants did not
argue in their Rule 59 motion that the first amended complaint failed to state a claim
under N.C. Gen. Stat. § 75-1.1, so we do not consider this argument, which
Defendants impermissibly raise now for the first time on appeal. Defendants made
no other assertions of legal error in their Rule 59 motion, which solely asserted factual
circumstances as bases for the relief sought.
It is unclear whether the Hoots Court, which said that a party must “be
afforded an opportunity to have considered on appeal any asserted errors of law
which he contends entitles him to a new trial[,]” Hoots, 282 N.C. at 490, 193 S.E.2d
at 717 (emphasis added), also intended that we review asserted Rule 59(a) grounds
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premised upon factual circumstances, such as the asserted lack of documents and the
calendaring mistake upon which Defendants based their Rule 59 motion. But at least
one decision of this Court applying Hoots and its progeny appears to have conducted
such a review, see Sisk, 221 N.C. App. at 635-36, 729 S.E.2d at 71-72 (ruling on Rule
59 motion asserting, inter alia, irregularity preventing a fair trial and surprise as
grounds for new trial), and our Supreme Court denied review of that decision, 366
N.C. 571, 738 S.E.2d 368. We will therefore review Defendants’ fact-based
arguments.
A careful review of the record leads us to conclude that Defendants’ Rule 59
motion should be denied. The record tends to show the following:
 On 31 July 2017, Defendants consented to an order scheduling discovery in
this litigation.
 On 25 August 2017, Plaintiff served Defendants with its discovery requests,
including requests for the production of “all bank statements for the periods
from January 2015 to December 2016, for any Person on which Ramani has
signatory authority, including but not limited to, any of Ramani’s personal
accounts, and any of Smoky’s Mart’s accounts[,]” (“Document Request 10”)
and “[f]or the period January 2013 to present . . . all documents evidencing
income received by Ramani” (“Document Request 16”).
 On 18 December 2017 and 8 January 2018, Plaintiff moved the trial court
to compel Defendants to comply with their discovery requests, specifically
noting that Defendants had failed to sufficiently respond to Document
Requests 10 and 16.
 On 16 January 2018, Defendants consented to the entry of an order
compelling them to supplement their discovery responses, including by
producing “all documents in their possession, custody or control responsive
to” Document Requests 10 and 16 “[o]n or before January 22, 2018[.]”
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 Defendants did not seek to procure the documents whose unavailability
they assert as grounds for a new trial—which include bank records that
would be responsive to Document Requests 10 and 16—until 5 February
2018.
The result of Defendants’ unreasonable delay in seeking to procure and produce the
documents requested by Plaintiff and ordered to be produced by the trial court is not
an “irregularity by which [Defendants were] prevented from having a fair [hearing]”
within the meaning of Rule 59(a)(1), and Defendants cannot claim that their inability
to produce the documents is the product of “surprise which ordinary prudence could
not have guarded against” within the meaning of Rule 59(a)(3). Rather, Defendants’
delay tends to demonstrate inexcusable imprudence in heeding the trial court’s
orders. We therefore reject Defendants’ argument that their inability to produce the
bank records entitles them to a new hearing on Plaintiff’s motion for sanctions.
Defendants’ imprudence also leads us to reject Defendants’ argument
regarding their counsel’s calendaring mistake. Our Supreme Court has upheld the
denial of relief sought under N.C. Gen. Stat. § 1A-1, Rule 60 for attorney neglect,
saying that “[a]llowing an attorney’s negligence to be a basis for providing relief from
orders would encourage such negligence and present a temptation for litigants to use
the negligence as an excuse to avoid court-imposed rules and deadlines.” Briley v.
Farabow, 348 N.C. 537, 546, 501 S.E.2d 649, 655 (1998). Further, even had
Defendants’ counsel properly calendared and appeared at the hearing on Plaintiff’s
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motion for sanctions, the fact that Defendants had consistently failed to meet their
obligations under the trial court’s orders governing discovery would remain, and
sanctioning Defendants would have been the proper outcome. See Robinson v.
Seaboard Sys. R.R., Inc., 87 N.C. App. 512, 528, 361 S.E.2d 909, 919 (1987) (a party
seeking a new trial “must demonstrate that he has been prejudiced”). We therefore
reject Defendants’ Rule 59 argument regarding their counsel’s calendaring mistake.
IV. Conclusion
Because Defendants did not raise below the argument they raise in support of
their appeal from the trial court’s 21 March 2018 order, we dismiss Defendants’
appeal from that order. Because the trial judge who entered the 3 December 2018
order lacked subject-matter jurisdiction to consider Defendants’ Rule 59 motion, we
vacate that order. Because we do not conclude that Defendants are entitled to a new
hearing on Plaintiff’s motion for sanctions, we deny Defendants’ Rule 59 motion.
DISMISSED IN PART, VACATED IN PART, AND DENIED IN PART.
Chief Judge McGEE and Judge HAMPSON concur.
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