First Citizens Bank & Trust Co. v. Northwestern Insurance

261 S.E.2d 242 (1980) 44 N.C. App. 414

FIRST CITIZENS BANK AND TRUST COMPANY, LINCOLNTON, North Carolina
v.
NORTHWESTERN INSURANCE COMPANY and Guy A. Melton.

No. 7927SC86.

Court of Appeals of North Carolina.

January 8, 1980.

M. T. Leatherman and Daniel Wilson Barefoot, Lincolnton, for plaintiff-appellee.

Frye, Booth & Porter by R. Michael Wells, Winston-Salem, and John P. Van-Zandt, III, and Don M. Pendleton, Lincolnton, for defendant-appellant, Northwestern Insurance Co.

ERWIN, Judge.

G.S. 1A-1, Rule 56(c), of the Rules of Civil Procedure limits entry of summary judgment to situations where no genuine issue as to a material fact exists, and a party is entitled to a judgment as a matter of law. G.S. 1A-1, Rule 56(c); Zimmerman v. Hogg & Allen, 286 N.C. 24, 209 S.E.2d 795 (1974).

If a genuine issue of a material fact does exist, the motion for summary judgment must be denied. Bank v. Evans, 296 N.C. 374, 250 S.E.2d 231 (1979); Zimmerman v. Hogg & Allen, supra.

"``"The determination of what constitutes a ``genuine issue as to any material fact' is often difficult. It has been said that an issue is material if the facts alleged are such as to constitute a legal defense or are of such nature as to affect the result of the action, or if the resolution of the issue is so essential that the party against whom it is resolved may not prevail. . . . It has been said that a genuine issue is one which can be maintained by substantial evidence.. . ."' McNair v. Boyette, 282 N.C. 230, 192 S.E.2d 457."

Zimmerman v. Hogg & Allen, 286 N.C. 24, 29, 209 S.E.2d 795, 798 (1974).

Appellant contends that a genuine issue of material fact exists as to whether the boat insured under its insurance policy is the one in which plaintiff had a security interest.

In moving for summary judgment, appellant relied on the discrepancy between the serial number identifying the boat in plaintiff's security instrument and the serial number of the boat covered by its insurance policy. However, four days prior to the hearing on the parties' respective summary judgment motions, plaintiff served on appellant a joint affidavit and a Manufacturer's Statement of Origin. The joint affidavit stated in pertinent part:

"On March 30, 1977, Guy A. Melton purchased from Lincoln Marine, Inc., a new 1977 Model 220 hardtop Sea Ray inboard-outboard boat, 235 Horsepower, bearing Motor No. W566684 and manufacturer's Serial No. 6504M0976-220HT010-7, as shown on manufacturer's statement of origin and bill of sale, photocopies of which are hereto attached. Immediately following the sale, Merle P. Beal, secretary for Mr. Grigg of Lincoln Marine, Inc., telephoned Mr. Charles Cox, of Charles Cox Insurance Agency, Gastonia, N. C., and ordered an insurance policy covering said boat and gave the serial number and motor number over the telephone.

Shortly thereafter, Northwestern Insurance Company Policy No. BOP 4325 was written by Charles Cox Insurance Agency, showing Motor No. W566684 and Serial No. 77220HT010 for said boat as indicated on a photocopy of the policy which is hereto attached."

The Manufacturer's Statement of Origin identified the boat as follows:

"YEAR 1977 MODEL 220 HARDTOP Hull Length 21 Ft. 7 In. Beam 8 Ft. 0 In. Motor No. W566684 HP 235 OMC Mfg. Serial No. HIN # SER6504M0976-220HT010-7"

These two items, if properly admitted and when viewed collectively, clearly indicate that the boats were one and the same, and it would be incumbent upon appellant to come forward with some evidence to show that a genuine issue of material fact still existed.

Appellant contends that the joint affidavit was improperly considered by the court at the hearing on the motions for summary judgment, because (1) the affidavit was filed on the day of the hearing of the motion, and (2) the affidavit was not based on competent evidence.

In Insurance Co. v. Chantos, 21 N.C.App. 129, 203 S.E.2d 421 (1974), we held that where a party had filed a motion for summary judgment but had waited until the day of the hearing of the motion to file and serve his supporting affidavits with the motion as required by G.S. 1A-1, Rule 6(d), of the Rules of Civil Procedure, the trial court erred in considering the affidavits supporting the motion for summary judgment.

In the instant case, plaintiff had properly served its original affidavits in support of its motion for summary judgment but had subsequently offered a supplemental joint affidavit as provided for in G.S. 1A-1, Rule 56(e), of the Rules of Civil Procedure. Thus, the situation is clearly distinguishable from that presented in Insurance Co. v. Chantos, supra.

In Insurance Co. v. Chantos, supra, we noted:

"According to the date of the defendant's affidavit, and the date of the verification thereof, it was signed on the same day that counsel certified that notice of the motion for summary judgment was mailed to plaintiff's counsel. It seems clear, therefore, that the affidavit was available for service with the notice of motion for summary judgment. If this practice were permitted, affidavits in support of a motion for summary judgment could always come as a surprise to the opposing party and would effectively deny the opposing party a chance to present affidavits in opposition to the motion.

Undoubtedly, Rule 56(e) grants to the trial court wide discretion to permit affidavits to be supplemented or opposed by depositions, answers to interrogatories, or further affidavits. However, this provision presupposes that an affidavit or affidavits have already been served. The rule speaks only of supplementing or opposing. Clearly, it does not intend to authorize filing, on the day of the hearing, the only affidavits supporting the motion for summary judgment."

Id. at 131, 203 S.E.2d at 423-24.

Here, appellant was served with the supplemental affidavits four days prior to the hearing, and it had ample time to present opposing affidavits. Thus, the trial court did not err in allowing the affidavits to be considered on the day of hearing the motions for summary judgment.

G.S. 1A-1, Rule 56(e), of the Rules of Civil Procedure provides in pertinent part: "Sworn or certified copies of all papers or parts thereof referred to in an affidavit shall be attached thereto or served therewith." Plaintiff failed to comply with the dictates of G.S. 1A-1, Rule 56(e), of the Rules of Civil Procedure. It did not submit "sworn or certified copies of all papers or parts thereof" referred to in its joint affidavit. Therefore, the court erred in considering the Manufacturer's Statement of Origin and the bill of sale. That portion of the affidavit based thereon as well as the conclusions of law contained therein should have been disregarded in considering the propriety of summary judgment.

Even without the evidence contained in the Manufacturer's Statement of Origin and the bill of sale, plaintiff's forecast of evidence is sufficient if considered alone to compel entry of a directed verdict in its favor.

However, a genuine issue of fact exists as to whether notice was given "as soon as practicable" as required by appellant's insurance policy assuming that the boat missing and the boat covered by the policy are the same one.

Justice Parker, in his concurring opinion in Muncie v. Insurance Co., 253 N.C. 74, 82-83, 116 S.E.2d 474, 480 (1960), stated:

"The policy requires that notice of the accident shall be given by the insured to the insurer ``as soon as practicable.' That means to give such notice within a reasonable time, for the word ``practicable' means ``capable of being put into practice, done, or accomplished; feasible.' Webster's New International Dictionary, 2nd Ed.; Unverzagt v. Prestera, 339 Pa. 141, 13 A.2d 46; Callaway v. Central Surety & Ins. Corp., 5 Cir., 107 F.2d 761; London Guarantee & Accident Co. v. Shafer, D.C., 35 F. Supp. 647; American Lumbermen's Mutual Casualty Co. v. Klein, D.C., 63 F. Supp. 701; Young v. Travelers Ins. Co., 5th Cir., 119 F.2d 877; Annotation 18 A.L.R.2d p. 462, § 14.

What is a reasonable time, when the facts are not in dispute, as here, is a question of law to be decided by the Court. Depot Cafe v. Century Indemnity Co., 321 Mass. 220, 72 N.E.2d 533; Unverzagt v. Prestera, supra."

Here, there is a dispute as to when defendant Melton notified appellant of the alleged theft. The corollary of the above rule established in Muncie is that when the facts are in dispute, as here, the question as to whether or not notice was given "as soon as practicable" is for the jury. See Freshman v. Stallings, 128 F. Supp. 179 (E.D.N.C.1955); Muncie v. Insurance Co., supra (J. Parker, concurring).

Also, a dispute exists as to the amount of the indebtedness owed plaintiff by defendant Melton which must be resolved in order to ascertain plaintiff's insurable interest under the policy, if any.

Appellant's other assignments of error need not be considered.

The judgment entered below is

Reversed.

VAUGHN and HILL, JJ., concur.