Watson v. Fulk

198 S.E.2d 730 (1973) 19 N.C. App. 377

Hiram WATSON
v.
Charlie H. FULK.

No. 7321DC553.

Court of Appeals of North Carolina.

September 12, 1973.

Roberts, Frye & Booth by Leslie G. Frye, Winston-Salem, for plaintiff appellant.

Wilson & Morrow by John F. Morrow, Winston-Salem, for defendant appellee.

BALEY, Judge.

The evidence of the plaintiff when viewed in the light most favorable to him was sufficient for submission to the jury, and the action of the trial court in granting a directed verdict for the defendant must be held as error.

There is no dispute about the fact that the parties entered into a business relationship for the purpose of raising tobacco on the defendant's land. It was agreed that each party was to furnish an equal amount of the labor and to share expenses and profits equally. Plaintiff has presented evidence from which a jury could conclude that he had performed his part of the agreement and was entitled to one-half of the proceeds from the sale of the tobacco less his one-half portion of the expenses incurred. The evidence further disclosed that defendant had possession of and sold the tobacco after it was harvested for the sum of more than $6,000.00 and had unilaterally determined that plaintiff was entitled to only $1,065.21 as his share of the profits.

It seems clear that this is a case in which plaintiff trusted the defendant to sell the tobacco, pay any expenses incurred from the proceeds of the sale, and make proper accounting to him for his portion of the profits. He reposed confidence in the defendant who had complete control and domination of their relationship. Defendant held the one-half portion of the proceeds from the tobacco crop in trust for the plaintiff and has refused to make an accounting to the plaintiff as beneficiary.

In Abbitt v. Gregory, 201 N.C. 577, 160 S.E. 896, the court in holding that the general manager of a corporation stood in a fiduciary relation to the stockholders stated:

"The courts generally have declined to define the term ``fiduciary relation' and thereby exclude from this broad term any relation that may exist between two or more persons with respect to the rights of persons or property of either.... The relation may exist under a variety of circumstances; it exists in all cases where 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. ``It not only includes all legal relations, such as attorney and client, broker and principal, executor or administrator and heir, legatee or devisee, ... trustee and cestui que trust, but it extends to any possible case in which a fiduciary relation exists in fact, and in which there is confidence reposed on one side, and resulting domination and influence on the other.' 25 C.J. 1119."

201 N.C. at 598, 160 S.E. at 906. Later cases have reaffirmed the holding of Abbitt. Link v. Link, 278 N.C. 181, 192, 179 S.E.2d 697, 704; Vail v. Vail, 233 N.C. 109, 114, 63 S.E.2d 202, 206; Bolich v. Insurance Company, 206 N.C. 144, 152, 173 S.E. 320, 324. See also 5 Bogert, Trusts and Trustees 2d, §§ 481-82; Dobbs, Remedies, § 10.4, at 679-82.

It seems apparent that defendant has acted in a fiduciary capacity with respect to the plaintiff and has a duty to account to him for his actions. "All fiduciaries may be compelled by appropriate proceeding to account for their handling of properties committed to their care." Lichtenfels v. Bank, 260 N.C. 146, 148, 132 S.E.2d 360, 362; accord, Dobbs, supra, § 4.3, at 252-53. See also Parker v. Brown, 136 N. C. 280, 48 S.E. 657, for application to an agricultural tenancy.

The appropriate method for determining the exact amount which may be due the plaintiff, if anything, is to require the defendant, who is in possession of the essential information, to render an accounting.

If there is no accounting of the expenses incurred, plaintiff has shown an income of at least $6,000.00 which is sufficient to support a jury verdict in his favor for not exceeding $3,000.00.

The motion of the defendant for a directed verdict should have been overruled.

New trial.

BROCK, C. J., and BRITT, J., concur.