NEWMAN MACHINE COMPANY v. Newman

163 S.E.2d 279 (1968) 2 N.C. App. 491

NEWMAN MACHINE COMPANY, Inc.
v.
George F. NEWMAN, Jr., Trustee.

No. 6818SC338.

Court of Appeals of North Carolina.

October 9, 1968. Certiorari Allowed November 26, 1968.

Adams, Kleemeier, Hagan & Hannah, by Charles T. Hagan, Jr., and Smith, Moore, Smith, Schell & Hunter, by McNeill Smith, Greensboro, for plaintiff.

McLendon, Brim, Brooks, Pierce & Daniels, by Hubert Humphrey, Greensboro, for defendant.

MALLARD, Chief Judge.

Defendant asserts in his brief that the question presented by this record is: "Did the Court below err in overruling the Demurrer based upon the grounds that the complaint does not state a proper action for removing a cloud on title or for declaratory relief and that there is a defect of parties?"

We are of the opinion and so decide that the complaint does not allege a cause of action for removing a cloud on title to personal property. See decision in the companion case, William M. York, Jr., and Frank W. York v. George F. Newman, Jr., Trustee, filed by this Court on 9 October 1968 for a discussion of what constitutes a cloud on title to real property.

We are of the opinion and so decide that the complaint is not sufficient to allege a cause of action under the Uniform Declaratory Judgment Act.

G.S. § 1-253 reads as follows:

"Courts of record within their respective jurisdictions shall have power to declare rights, status, and other legal relations, whether or not further relief is or could be claimed. No action or proceeding shall be open to objection on the ground that a declaratory judgment or decree is prayed for. The declaration may be either affirmative or negative in form and effect; and such declarations shall have the force and effect of a final judgment or decree."

This statute is broad in its terms, but it has been consistently held that under it, the court will not entertain a proceeding which lacks the essentials of an actual controversy. The presence of a genuine controversy is a jurisdictional necessity. Lide v. Mears, 231 N.C. 111, 56 S.E.2d 404. In Town of Tryon v. Duke Power Co., 222 N.C. 200, 22 S.E.2d 450, it is said:

"In marginal cases the rule may be difficult to apply, because it involves a definition, or at least an appraisal, of the term `controversy,' which must, perhaps, depend upon the individual case; but in the case at bar, the Court does not feel that such embarrassment exists. A mere difference of opinion between the parties as to whether plaintiff has the right to purchase or condemn, or otherwise acquire the utilities of the defendant, without any practical bearing on any contemplated action, does not constitute a controversy within the meaning of the cited cases."

In 22 Am.Jur.2d, Declaratory Judgments, § 11, appears the following principle of law: "To constitute an actual controversy there need not exist an actual right of action in one party against the other in which consequential relief might be granted. But a mere fear or apprehension that a claim may be asserted in the future is not ground for issuing a declaratory judgment; before granting such relief, the court must be convinced that litigation sooner or later appears to be unavoidable. Consequently, where it appears that the facts alleged disclose that either the statute of limitations or the doctrine of laches is applicable thereto, there is no justiciable controversy as contemplated by the Declaratory Judgments Act." (Emphasis added.)

In an Annotation in 12 A.L.R. 52, 74, there appears the following:

"In North Eastern Marine Engineering Co. v. Leeds Forge Co. [1906] 1 Ch. 324, 94 L.T.N.S. 56, 75 L.J.Ch.N.S. 178, 54 Week Rep. 370, 22 Times L.R. 178, it is held that a declaration will not be made to the effect that the plaintiffs have a good ground of defense if the defendant should sue them for damages for the infringement of a certain patent. The court said that the mere fact that A. is supposed to contemplate bringing an action against B., or that A. may have stated that he has ground for such an action, does not entitle B. to bring an action against A. to have it declared that A. has not a cause of action against B."

Applying these principles of law to the facts in the case under consideration, we conclude that the mere threat of an action to rescind a sale of personal property, or to sue for damages, is not sufficient to constitute such an actual controversy as is cognizable under the Uniform Declaratory Judgment Act.

"The essential distinction between an action for declaratory judgment and the usual action is that no actual wrong need have been committed or loss have occurred in order to sustain the declaratory judgment action, but there must be no uncertainty that the loss will occur or that the asserted right will be invaded." 22 Am.Jur.2d, Declaratory Judgments, § 1. In the instant case there is no certainty that the defendant will bring the action that is threatened in the letter written by his attorney. There is therefore no certainty that a loss will occur or that a right will be invaded.

"It would appear that declaratory relief was unknown at common law, inasmuch as the common-law conception of courts was that they were a branch of the government created to redress private wrongs and punish the commission of crimes and misdemeanors. The courts took no official interest in the affairs of civil life until one person had wronged another; then the object was to give relief for the injury inflicted." 22 Am.Jur.2d, Declaratory Judgments, § 3.

The main distinction in the law between this case concerning personal property and the law in the companion case of William M. York, Jr., and Frank W. York v. George F. Newman, Jr., Trustee, concerning real property is that there is no statute in North Carolina giving rise to a cause of action for simply claiming an interest in personal property. We find no statute giving rise to a cause of action to determine adverse claims against one who may threaten to sue another for damages to rescind a sale of personal property. In the York case concerning real estate, the applicable statute, G.S. § 41-10, provides that "an action may be brought by any person against another who claims an estate or interest in real property adverse to him for the purpose of determining such adverse claims." The statute provides that the claiming of an interest in real property adverse to another gives rise to the cause of action. The General Assembly could have but did not include personal property under the provisions of this statute.

We are of the opinion that the complaint does not allege a justiciable cause of action and that the demurrer should have been allowed. The judgment of Judge Crissman overruling the demurrer is

Reversed.

CAMPBELL and MORRIS, JJ., concur.