Hinson v. City of Greensboro

NO. COA13-404
NORTH CAROLINA COURT OF APPEALS
Filed: 4 February 2014
JAMES HINSON,
Plaintiff,
v. Guilford County
No. 10 CVS 9711
CITY OF GREENSBORO, DAVID WRAY,
former Police Chief of the City of
Greensboro, in his official and
individual capacity, and RANDALL
BRADY, former Deputy Police Chief
of the City of Greensboro, in his
official and individual capacity,
Defendants.
Appeal by defendants from order entered 18 December 2012 by
Judge Edwin G. Wilson, Jr., in Guilford County Superior Court.
Heard in the Court of Appeals 8 October 2013.
Ferguson Chambers & Sumpter, P.A., by James E. Ferguson, II,
for plaintiff-appellee James Hinson.
Van Laningham Duncan PLLC, by Allison O. Van Laningham, Alan
W. Duncan, and L. Cooper Harrell, for defendant-appellant
City of Greensboro.
Smith, James, Rowlett & Cohen, LLP, by Seth R. Cohen, and
Carruthers & Roth, P.A., by Kenneth R. Keller, for defendant-
appellants Randall Brady and David Wray.
McCULLOUGH, Judge.
Defendants City of Greensboro, David Wray, and Randall Brady
appeal from a trial court’s interlocutory order, denying their
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motions to dismiss plaintiff James Hinson’s complaint, except as
to plaintiff’s claim for punitive damages against defendant City
of Greensboro. Based on the following reasons, we reverse the
trial court’s denial of defendants’ motion to dismiss with respect
to plaintiff’s State claims against defendant City of Greensboro
and defendants David Wray and Randall Brady in their official
capacities.
I. Background
On 30 May 2008, plaintiff James Hinson filed a complaint
against defendant City of Greensboro (“defendant Greensboro”),
David Wray, former Police Chief of the City of Greensboro, in his
official and individual capacity (“defendant Wray”), and Randall
Brady, former Deputy Police Chief of the City of Greensboro, in
his official and individual capacity (“defendant Brady”)
(collectively “defendants”). Plaintiff sought compensation and
alleged that defendants had subjected plaintiff to discrimination
on the basis of race, conspired to discriminate on the basis of
race, and conspired to injure plaintiff in his reputation and
profession. Plaintiff amended this complaint on 6 February 2009.
On 4 September 2009, plaintiff filed a voluntary dismissal of his
claims, without prejudice.
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Plaintiff filed a second complaint on 3 September 2010. The
complaint alleged the following, in pertinent part: Plaintiff, an
African-American, started working for the Police Department of the
City of Greensboro in 1991 as a police officer in training.
Plaintiff received numerous awards and received evaluations at the
level of “exceeds expectations” and “superior performance” from
the years 2000 through 2010. On 1 December 2001, plaintiff was
promoted to Lieutenant. In 2003 and 2004, Chief of Police
defendant Wray and Deputy Police Chief defendant Brady began
“targeting plaintiff and creating problems for him in his workplace
because of plaintiff’s race.”
The complaint further alleged that in 2003, defendants Wray
and Brady directed two officers to gather pictures of various black
officers employed by the Greensboro Police Department, including
a photograph of plaintiff, to be used in line-up books or to be
used in line-up photos while similarly situated white officers
were not treated in this manner. From 2003 to 2004, defendants
Wray and Brady caused some black officers of the City of Greensboro
Police Department, including plaintiff, to be investigated by the
Special Investigation Division (“SID”) for alleged misconduct when
SID was not created for this purpose. The Criminal Investigation
Division (“CID”) and Internal Affairs units were designed to
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investigate matters involving Greensboro Police Officers.
Defendants required white officers suspected of wrongdoing to be
investigated by the CID, Internal Affairs Division, or caused some
white officers not to be investigated at all.
Plaintiff was transferred from the Operation Support Division
to the Central Division under the direction of a Commanding Officer
who required plaintiff to complete a detailed monthly schedule.
Plaintiff alleges that similarly situated white officers were not
treated in this manner. Plaintiff’s department-issued computer
was installed with a device that would monitor his activity while
no other lieutenants in the Greensboro Police Department were
monitored. Plaintiff filed a grievance alleging retaliation and
a hostile work environment but dropped the grievance after a
meeting on 2 February 2005 where defendant Wray, defendant Brady,
an Assistant Chief, a Commanding Officer, and Police Attorney were
present. In March 2005, at the instruction of defendant Wray, a
tracking device was placed on plaintiff’s patrol car. Defendant
Brady advised plaintiff that he was under surveillance because he
was “possibly working off duty while on duty in violation of the
Greensboro Police Department Departmental Directives and
Procedures.” Plaintiff alleged that his race was the motivation
in initiating these investigations.
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Defendant Wray falsely reported to the City Manager, Deputy
City Manager, City Attorney, and media that plaintiff was suspected
of being associated with illegal drug activity and other criminal
activity. On 17 June 2005, plaintiff was suspended by defendant
Wray for alleged on-going relationships with prostitutes and
others who have a reputation in the community for involvement in
criminal activity. Defendant Wray also delivered a public media
statement falsely alleging that plaintiff was part of an “ongoing
multi-jurisdictional criminal investigation” and that plaintiff’s
actions were under “internal review.” Even though plaintiff was
cleared by SID for any alleged wrongdoing, defendant Wray initiated
an additional investigation of plaintiff by hiring retired and
former officers of the Internal Affairs Division. Defendants Brady
and Wray approved an additional investigation which did not adhere
to the Greensboro Police Department’s policies and Standard
Operating Procedures. It was completed on 31 August 2005. On 5
June 2005, plaintiff was placed on leave. He was reinstated in
January 2006. Since 2001, plaintiff has not been promoted and has
not received any awards or commendations within the department.
Plaintiff’s complaint alleged discrimination on the basis of
his race, conspiracy to discriminate on the basis of race, and
conspiracy to injure plaintiff and his reputation and profession
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in violation of federal law, 42 USC § 1981, § 1983, and § 1985 and
in violation of North Carolina common law. Plaintiff argued that
defendants had waived their governmental immunity by the purchase
of liability insurance, as provided in N.C. Gen. Stat. § 160A-
4851, and that defendant Greensboro was liable as respondeat
superior as to each of the state common law claims against
defendants Wray and Brady.
On 22 November 2010, defendant Wray and defendant Brady filed
motions to dismiss pursuant to Rule 12(b)(6) of the North Carolina
Rules of Civil Procedure. On 24 November 2010, defendant
Greensboro filed a motion to dismiss pursuant to Rule 12(b)(1),
12(b)(2), and 12(b)(6).
Following a hearing held on 16 October 2012, the trial court
entered an order on 18 December 2012. The order denied defendant
Wray’s motion to dismiss and defendant Brady’s motion to dismiss.
The order denied defendant Greensboro’s motion to dismiss, except
1N.C.G.S. § 160A-485(a) (2013) states that “[a]ny city is
authorized to waive its immunity from civil liability in tort by
the act of purchasing liability insurance. Participation in a local
government risk pool pursuant to Article 23 of General Statute
Chapter 58 shall be deemed to be the purchase of insurance for the
purposes of this section. Immunity shall be waived only to the
extent that the city is indemnified by the insurance contract from
tort liability. No formal action other than the purchase of
liability insurance shall be required to waive tort immunity, and
no city shall be deemed to have waived its tort immunity by any
action other than the purchase of liability insurance. . . .”
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as to the claim for punitive damages against defendant Greensboro.
As to that claim only, the motion to dismiss was allowed.
From this order, defendants appeal.
II. Standard of Review
“On appeal of a 12(b)(6) motion to dismiss for failure to
state a claim, our Court conducts a de novo review[.]” Ventriglia
v. Deese, 194 N.C. App. 344, 347, 669 S.E.2d 817, 819-820 (2008)
(citation omitted). “We consider ‘whether the allegations of the
complaint, if treated as true, are sufficient to state a claim
upon which relief can be granted under some legal theory.’”
Bridges v. Parrish, 366 N.C. 539, 541, 742 S.E.2d 794, 796 (2013)
(citation omitted). “The court must construe the complaint
liberally and should not dismiss the complaint unless it appears
beyond a doubt that the plaintiff could not prove any set of facts
to support his claim which would entitle him to relief.” Enoch v.
Inman, 164 N.C. App. 415, 417, 596 S.E.2d 361, 363 (2004) (citation
and quotation marks omitted).
“Dismissal is proper, however, when one of the following three
conditions is satisfied: (1) the complaint on its face reveals
that no law supports the plaintiff’s claim; (2) the complaint on
its face reveals the absence of facts sufficient to make a good
claim; or (3) the complaint discloses some fact that necessarily
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defeats the plaintiff’s claim.” Newberne v. Dep’t of Crime Control
& Pub. Safety, 359 N.C. 782, 784, 618 S.E.2d 201, 204 (2005)
(citation and quotation marks omitted).
III. Discussion
A. Scope of Review
As a preliminary matter, we must first identify the issues
that are properly before this Court.
“This Court has held that appeals from interlocutory orders
raising issues of governmental or sovereign immunity affect a
substantial right sufficient to warrant immediate appellate
review.” Williams v. Devere Const. Co., Inc., __ N.C. App. __,
__, 716 S.E.2d 21, 25 (2011) (citation omitted). However, this
only applies “for denial of a motion to dismiss under Rules
12(b)(2), 12(b)(6), and 12(c), or a motion for summary judgment
under Rule 56. We cannot review a trial court’s order denying a
motion to dismiss under Rule 12(b)(1).” Horne v. Town of Blowing
Rock, __ N.C. App. __, __, 732 S.E.2d 614, 621 (2012). Therefore,
defendants’ challenges to the trial court’s denial of their motion
to dismiss under Rule 12(b)(2) and 12(b)(6) based on governmental
immunity grounds are properly before us.
Defendants have also sought immediate review of the trial
court’s denial of their motion to dismiss based on non-immunity
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related challenges by petitioning this Court.2 However, defendants
have not stated how a substantial right would be lost absent
immediate appellate review of these non-immunity related
challenges. Because it is well established that “[i]t is not the
duty of this Court to construct arguments for or find support for
appellant’s right to appeal from an interlocutory order” and that
“the appellant has the burden of showing this Court that the order
deprives the appellant of a substantial right which would be
jeopardized absent a review prior to a final determination on the
merits[,]” we decline to review the non-immunity related
challenges to the trial court’s denial of defendants’ motions to
dismiss. Jeffreys v. Raleigh Oaks Joint Venture, 115 N.C. App.
377, 380, 444 S.E.2d 252, 254 (1994) (citations omitted). See
2The non-immunity related arguments advanced by defendants consist
of claims that plaintiff’s cause of action on the basis of race in
violation of 42 U.S.C. § 1981 was time-barred; that defendant
Greensboro could not be held liable on the basis of respondeat
superior; that plaintiff’s claim pursuant to 42 U.S.C. § 1983 is
a new claim that cannot be included based on the “savings
provision” of Rule 41(a) of the North Carolina Rules of Civil
Procedure; that plaintiff’s discrimination claim in violation of
42 U.S.C. § 1983 for violation of 42 U.S.C. § 1981 is time-barred;
that defendants cannot be parties to a conspiracy; that plaintiff
cannot show an agreement that would support a civil conspiracy due
to the intracorporate immunity doctrine; that the parties’ signed
“Memorandum of Understanding” operated as an accord and
satisfaction to bar plaintiff’s claims; and that plaintiff’s 2010
complaint did not properly allege claims against defendants Wray
and Brady in their individual capacities, thereby violating Rule
41(a) and being barred by the statute of limitations.
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Bynum v. Wilson County, __ N.C. App. __, __, 746 S.E.2d 296, 299-
300 (2013) (granting review of an interlocutory order raising
issues of governmental or sovereign immunity but limiting the scope
of review to only immunity-related challenges).
Based on the foregoing, defendants are not entitled to
immediate appellate review of the trial court’s denial of their
motions to dismiss on the basis of any non-immunity related
arguments and we dismiss those portions of their appeal that rely
on non-immunity related issues. Furthermore, we deny defendant’s
petitions for writ of certiorari, requesting that our Court review
the entirety of the 18 December 2012 Order, including non-immunity
related arguments.
B. Sovereign Immunity
Defendants argue that plaintiff’s state law claims of
discrimination on the basis of race, conspiracy to discriminate on
the basis of race, and conspiracy to injure plaintiff in his
reputation and profession all fail under the doctrine of
governmental immunity.
It is well established that “[s]overeign immunity shields the
State, its agencies, and officials sued in their official
capacities from suit on state law claims unless the State consents
to suit or waives its right to sovereign immunity.” Toomer v.
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Garrett, 155 N.C. App. 462, 480, 574 S.E.2d 76, 91 (2002) (citation
omitted). “The rule of sovereign immunity applies when the
governmental entity is being sued for the performance of a
governmental, rather than proprietary, function.” Dalenko v. Wake
Cty. Dep’t of Human Servs., 157 N.C. App. 49, 55, 578 S.E.2d 599,
603 (2003) (citation omitted). “Law enforcement is well-
established as a governmental function, and includes the training
and supervision of officers by a police department.” Pettiford v.
City of Greensboro, 556 F. Supp. 2d 512, 524 (2008) (citations and
quotation marks omitted).
“A [city] may, however, waive such immunity through the
purchase of liability insurance. [I]mmunity is waived only to the
extent that the [city] is indemnified by the insurance contract
from liability for the acts alleged.” Satorre v. New Hanover
County Bd. Of Comm’rs, 165 N.C. App. 173, 176, 598 S.E.2d 142, 144
(2004) (citations and quotation marks omitted). A municipality
may also waive its immunity by participating in a local government
risk pool. N.C. Gen. Stat. § 160A-485(a) (2011). “In order to
overcome a defense of [sovereign] immunity, the complaint must
specifically allege a waiver of [sovereign] immunity. Absent such
an allegation, the complaint fails to state a cause of action.”
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Green v. Kearney, 203 N.C. App. 260, 268, 690 S.E.2d 755, 762
(2010) (citation omitted).
We find Pettiford v. City of Greensboro, 556 F. Supp. 2d 512
(M.D.N.C. 2008), to be instructive on the issue before us. In
Pettiford, plaintiffs Nicole and Anthony Pettiford sought civil
damages based on alleged misconduct arising from an investigation
by the Greensboro Police Department which is operated and owned by
the defendant City of Greensboro. Id. at 515. The plaintiffs
filed the action in the Superior Court of Guilford County, North
Carolina, seeking recovery under the United States Constitution,
pursuant to 42 U.S.C. § 1983, the North Carolina Constitution, and
the common law of negligence. Id. at 516. The City of Greensboro
removed the action on the grounds of federal question jurisdiction.
Id. In lieu of answering, the City of Greensboro filed a motion
to dismiss and a supplemental motion to dismiss pursuant to Rule
12(b)(1), (b)(2), (b)(6) and (b)(7)3 of the Federal Rules of Civil
Procedure. Id.
3Rule 12(b) of North Carolina Rules of Civil Procedure provides
the following, in pertinent part: “Every defense, in law or fact,
to a claim for relief in any pleading, whether a claim,
counterclaim, crossclaim, or third-party claim, shall be asserted
in the responsive pleading thereto if one is required, except that
the following defenses may at the option of the pleader be made by
motion: (1) Lack of jurisdiction over the subject matter, (2)
lack of jurisdiction over the person, . . . (6) Failure to state
a claim upon which relief can be granted, (7) Failure to join a
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The Pettiford court noted that the City of Greensboro
acknowledged its participation in a Local Government Excess
Liability Fund (“Fund”) and purchased an excess liability
insurance policy, but that “neither constitute[d] a waiver of its
immunity.” Id. at 525. Uncontested evidence established that the
City of Greensboro is self-insured up to $100,000.00 and that the
Fund pays claims between $100,000.00 and $3,000,000.00, though the
City of Greensboro is obligated to repay the Fund in the entirety.
Id. The court in Pettiford concluded that the Fund did not waive
the City of Greensboro’s immunity as explained in Dobrowolska ex
rel. Dobrowolska v. Wall, 138 N.C. App. 1, 8-9, 530 S.E.2d 590,
596 (2000), because the Fund failed to meet the statutory
requirements of a local government risk pool.
Furthermore, the Pettiford court concluded that the City of
Greensboro’s purchase of excess liability insurance did not waive
its governmental immunity based on the explicit language of the
policy. The City of Greensboro acknowledged that it purchased a
$5 million excess liability policy to cover claims above $3
million. The Pettiford court examined the policy provisions of
the excess liability insurance and found them to be substantially
necessary party.” N.C. Gen. Stat. § 1A-1, Rule 12(b)(1), (2),
(6), and (7) (2013).
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similar to those found in Magana v. Charlotte-Mecklenburg Board of
Education, 183 N.C. App. 146, 645 S.E.2d 91 (2007), where our Court
held that a local governmental entity had not waived its immunity
through the purchase of excess liability insurance. Id. at 527.
Both the policy found in Magana and the City of Greensboro’s policy
in Pettiford “disclaim[ed] any right of indemnification until (1)
the damages exceed a self-insured retention amount ($1 million in
Magana and $3 million in [Pettiford]); (2) the insured has a legal
obligation to pay those damages; and (3) the insured actually pays
those damages to the claimant.” Id. at 529. The Pettiford court
concluded the following:
This excess liability insurance does not apply
unless and until the City has a legal
obligation to pay the $ 3 million self-insured
amount. Because the City is immune from
negligence claims up to $ 3 million, it will
never have a legal obligation to pay this
self-insured amount and, thus, has not waived
its immunity through the purchase of this
excess liability insurance policy.
The City of Greensboro’s motion to dismiss and supplemental motion
to dismiss the negligence claims were granted. Id. at 529.
In the case before us, plaintiff argued in the 3 September
2010 complaint that defendant Greensboro had waived its
governmental immunity by the purchase of liability insurance. In
its motion to dismiss, defendant Greensboro acknowledges the
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purchase of liability insurance, but maintains that the liability
insurance does not constitute a waiver of its sovereign immunity.
In support of its defense, defendant Greensboro filed the affidavit
of Everette Arnold, Executive Director of the Guilford City/County
Insurance Advisory Committee and the insurance contracts
themselves4. The evidence indicates that in 2004, defendant
Greensboro purchased a $5 million excess liability policy with a
$3 million self-insured retention from the Genesis Insurance
Company. Arnold’s affidavit stated that “the retained limit
($3,000,000.00) ‘must be paid by the Insured. . . .’ Thus, under
the terms of the policy, the City [of Greensboro] is responsible
for paying $3,000,000.00 before there is any potential coverage
under the Genesis Insurance policy.” The language of the insurance
policy states that “[t]his policy is not intended by the Insured
to waive its governmental immunity[.]” We find these policy
provisions to be substantially similar to those found in Magana
and Pettiford.
4The defense of sovereign immunity is both a North Carolina Rules
of Civil Procedure Rule 12(b)(1) and Rule 12(b)(2) defense. Battle
Ridge Cos. v. N.C. DOT, 161 N.C. App. 156, 157, 587 S.E.2d 426,
427 (2003). “Consideration of the affidavits and insurance
contracts is proper, without converting the motion to dismiss to
one for summary judgment, under motions filed pursuant to Rules
12(b)(1) and (b)(2) and with respect to state law claims.”
Pettiford, 556 F. Supp. 2d at 525 n.11.
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Based on the terms of defendant Greensboro’s liability
insurance policy, we hold that defendant Greensboro has not waived
its immunity as to plaintiff’s State claims of discrimination on
the basis of race, conspiracy to discriminate on the basis of race,
and conspiracy to injure plaintiff in his reputation and
profession. Furthermore, plaintiff’s claims against defendants
Wray and Brady in their official capacities “is a suit against the
State” and therefore, sovereign immunity applies. White v. Trew,
366 N.C. 360, 363, 736 S.E.2d 166, 168 (2013) (citation omitted);
See Clayton v. Branson, 153 N.C. App. 488, 493, 570 S.E.2d 253,
257 (2002) (stating that “[a]n officer acting in his official
capacity shares the municipalities immunity or waiver” (citation
omitted)). Accordingly, we reverse the trial court’s denial of
defendants’ motion to dismiss with respect to plaintiff’s state
claims against defendant Greensboro and defendants Wray and Brady
in their official capacities.
Reversed.
Judges MCGEE and DILLON concur.