Emerson v. Cape Fear Country Club, Inc.

IN THE COURT OF APPEALS OF NORTH CAROLINA
No. COA17-1149
Filed: 5 June 2018
New Hanover County, No. 16-CVS-1333
WILLIAM P. EMERSON, JR., Plaintiff,
v.
CAPE FEAR COUNTRY CLUB, INCORPORATED, Defendant.
Appeal by Plaintiff from order entered 5 June 2017 by Judge Andrew Heath in
New Hanover County Superior Court. Heard in the Court of Appeals 5 March 2018.
Block, Crouch, Keeter, Behm & Sayed, LLP, by Daniel Lee Brawley and Auley
M. Crouch, III, for plaintiff-appellant.
Cranfill, Sumner & Hartzog, LLP, by Benton L. Toups and Elizabeth C. King,
for defendant-appellee.
MURPHY, Judge.
N.C.G.S. § 55A-6-31(a) calls for nonprofit corporations to act “in a manner that
is fair and reasonable and . . . in good faith” when they terminate or suspend a
membership. N.C.G.S. § 55A-6-31(a) (2017). However, it does not require a country
club’s board of directors, in all situations, to provide a member with prior notice or an
opportunity to be heard regarding the termination of a membership.
Plaintiff, William P. Emerson, Jr. (“Emerson”), appeals from the trial court’s
order granting summary judgment in favor of Defendant, Cape Fear Country Club,
Inc. (“Club”), a nonprofit corporation, on all of Emerson’s three claims. In his
Complaint, filed 21 April 2016, Emerson sought declaratory judgments as to (1)
EMERSON V. CAPE FEAR COUNTRY CLUB, INC.
Opinion of the Court
Emerson’s membership status in the Club and (2) whether the Club could, in alleged
compliance with N.C.G.S. § 55A-6-31(a), conduct a curative hearing after Emerson’s
membership had been terminated. Emerson’s third claim for relief sought
compensatory and punitive damages for his hypothetical expenses in joining a
comparable country club and for the Club’s purportedly wrongful and malicious
termination of his membership.
Below, we address (1) the statutory requirement of N.C.G.S. § 55A-6-31(a), (2)
Emerson’s failure to mitigate his alleged damages, and (3) the mootness of Emerson’s
remaining claims. While we hold that the statute does not require prior notice and a
participatory hearing in all situations, even if notice and a hearing are required here,
Emerson failed to mitigate his alleged damages resulting from the Club’s alleged
violation of N.C.G.S. § 55A-6-31(a). Thus, Emerson is barred from recovering the
compensatory and punitive damages sought in his Complaint. Due to our resolution
of Emerson’s third claim for relief, his first two claims under the Declaratory
Judgment Act are moot, and we decline to address them. Accordingly, we affirm the
trial court’s grant of summary judgment in favor of the Club on each of Emerson’s
claims.
BACKGROUND
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Opinion of the Court
On 1 January 2016, Emerson, who had been a member of the Club for
approximately 30 years, had a disagreement with an employee in the golf shop.1 The
employee reported the incident to the Club’s General Manager, Mary Geiss, who
brought the matter to the attention of the Executive Committee by email on 2
January 2016. This was not Emerson’s first act of misbehavior, and Club President
Buck Beam and other members of the Executive Committee met on 5 January 2016
to discuss the incident. The Executive Committee then called a special meeting of
the Board of Directors (“Board”), which met and voted on 7 January 2016 to terminate
Emerson’s membership.
It is uncontested that Emerson was aware neither of the Executive
Committee’s nor the Board’s deliberations until 8 January 2016, when the Club
President and two other Board members called Emerson to advise him of his
termination. Emerson also received a letter from the Club President dated 8 January
2016 informing him of his termination. The letter provided the grounds for
termination, stating that it was “in response to [Emerson’s] actions on club property
on January 1, 2016 and [Emerson’s] cumulative disciplinary history while a member
1 The nature and content of the 1 January 2016 incident are somewhat in dispute. In his affidavit, the
Club President relayed the contents of an email from the Club Manager, who wrote that Emerson used
expletives in his conversations with Club employees and in front of Club guests during the 1 January
2016 exchange and declared, “[T]his is war,” to one of the Club employees. In his deposition testimony,
Emerson claimed that he was not shouting or cursing during the exchange and disagreed with one
Club employee’s characterization of the exchange between Emerson and the employee. Later in his
deposition, Emerson did not object to another witness’s description of the incident as a “profanity-laced
tirade” by Emerson.
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of Cape Fear Country Club.” Emerson’s disciplinary history at the Club included one
incident on or about 27 February 2005 and another incident on 29 April 2007.
In the February 2005 incident, Emerson got in an argument with another Club
member, which resulted in damage to Club property. Emerson also threatened a
Club employee’s job. In response to the 2005 incident, Emerson was suspended for
thirty days, placed on a twelve-month probation period, given a twelve-month alcohol
prohibition, fined $1,500, and required to replace the damaged property and apologize
to the employees involved. Emerson appealed and was given an opportunity to
appear before the Board. The Club eliminated the twelve-month probationary period,
the twelve-month alcohol prohibition, and the $1,500 fine as conditions of Emerson’s
punishment. Although the record reflects that Emerson came on to Club premises
during his suspension, thus violating its terms, his written apology of 3 June 2005
prompted the Club’s then-President to lift Emerson’s suspension.
In the April 2007 incident, Emerson had some sort of dispute with another
Club member in the Card Room after a disagreement over a golf bet. As a result,
Emerson’s membership was suspended for six months. Emerson’s initial
readmittance was unsuccessful after Emerson’s “address at the Board of Directors
meeting,” and the Board decided to extend Emerson’s suspension for an additional
six months. The Board received letters on Emerson’s behalf from other Club members
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Opinion of the Court
and decided to invite Emerson back to his membership approximately two months
after imposing the additional six-month suspension.
In the instant matter, after notifying Emerson of the termination of his
membership by letter dated 8 January 2016, the Club President sent Emerson
another letter dated 5 February 2016. This subsequent letter advised Emerson that
the Board “[was] prepared to provide [Emerson] an opportunity to speak on [his]
behalf concerning the termination of [his] membership.” Emerson acknowledged
receipt by letter on 12 February 2016 but declined to attend the proposed 15 February
2016 meeting.
Emerson filed his Complaint on 21 April 2016. After discovery and depositions,
the trial court disposed of Emerson’s claims by entering summary judgment in favor
of the Club. Emerson timely appealed.
ANALYSIS
“The standard of review for summary judgment is de novo.” Forbis v. Neal,
361 N.C. 519, 524, 649 S.E.2d 382, 385 (2007). Summary judgment is proper when
“the pleadings, depositions, answers to interrogatories, and admissions on file,
together with the affidavits, if any, show that there is no genuine issue as to any
material fact and that any party is entitled to a judgment as a matter of law.”
N.C.G.S. § 1A-1, Rule 56 (2017). Additionally, we draw all inferences of fact in favor
of the non-moving party. Forbis, 361 N.C. at 524, 649 S.E.2d at 385.
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Emerson’s Complaint raises questions about the procedural requirement of
N.C.G.S. § 55A-6-31, which governs the termination, expulsion, and suspension of an
individual’s membership in a nonprofit corporation.
N.C.G.S. § 55A-6-31 states:
(a) No member of a corporation may be expelled or
suspended, and no membership may be terminated or
suspended, except in a manner that is fair and
reasonable and is carried out in good faith.
(b) Any proceeding challenging an expulsion, suspension,
or termination shall be commenced within one year
after the member receives notice of the expulsion,
suspension, or termination.
(c) A member who has been expelled or suspended may be
liable to the corporation for dues, assessments, or fees
as a result of obligations incurred or commitments
made by the member prior to expulsion or suspension.
Emerson’s Complaint alleges various deficiencies with the Board’s termination,
including: the failure to notify Emerson of the 7 January 2016 meeting, the lack of
opportunity for Emerson to appear, hear, or present evidence at the meeting, and the
alleged failure by the Board to hear from witnesses against Emerson at the meeting.
Our only precedent interpreting the requirement of N.C.G.S. § 55A-6-31(a) has
involved First Amendment issues not argued here.2 See Tubiolo v. Abundant Life
Church, Inc., 167 N.C. App. 324, 330, 605 S.E.2d 161, 165 (2004) (“A church’s criteria
2Although our opinion in Johnson v. Antioch United Holy Church, Inc., 214 N.C. App. 507, 509, 512-
13, 714 S.E.2d 806, 809, 811 (2011) cited N.C.G.S. § 55A-6-31, we did not interpret the “fair and
reasonable and . . . good faith” requirement of the statute in that case.
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Opinion of the Court
for membership and the manner in which membership is terminated are core
ecclesiastical matters protected by the First and Fourteenth Amendments of the
United States Constitution and section 13 of Article I of the Constitution of the State
of North Carolina.”). Because this case does not implicate core ecclesiastical matters
and no other First Amendment arguments are before us, we proceed to consider
Emerson’s arguments regarding the procedural requirement of N.C.G.S. § 55A-6-
31(a).
A. Compensatory and Punitive Damages
To determine whether N.C.G.S. § 55A-6-31 includes participatory rights—the
purported violation of which forms the basis of Emerson’s claim for compensatory and
punitive damages—we begin with the text of the statute. See Elec. Supply Co. of
Durham v. Swain Elec. Co., 328 N.C. 651, 656, 403 S.E.2d 291, 294 (1991)
(“Legislative purpose is first ascertained from the plain words of the statute.”). The
terms “fair and reasonable and . . . good faith” do not have a statutory definition, so
it is useful to look to the enactment of the statute to discover legislative intent. Our
Supreme Court has interpreted legislative intent based on the similarity between
model legislation submitted to the General Assembly and the statutory provisions
ultimately adopted. See Quick v. United Benefit Life Ins. Co., 287 N.C. 47, 51-52, 56,
213 S.E.2d 563, 565-66, 568-69 (1975) (considering the applicability of N.C.G.S. §
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31A-3(3), in light of the Model Act upon which it was based, to a person convicted of
involuntary manslaughter).
The General Assembly enacted the first version of the North Carolina
Nonprofit Corporation Act in 1955 (“1955 Act”). See 1955 N.C. Sess. Laws 1239
(amended 1993). The 1955 Act borrowed many provisions from the A.B.A. Model
Nonprofit Corporation Act (“Model Act”), which had been created in 1952. See Comm.
on Corp. Laws of the Section of Corp., Banking, and Bus. Law of the A.B.A., Model
Non-Profit Corporation Act (1952). The early versions of the Model Act and the 1955
Act lacked provisions describing procedures for member expulsion or termination.
See 1955 N.C. Sess. Laws 1250-52 (defining membership and quorum, describing
procedures to protect property rights of expelled members, and providing for
meetings, notice of meetings, and voting); Comm. on Corp. Laws of the Section of
Corp., Banking, and Bus. Law of the A.B.A, supra, at 8-11 (providing for membership,
meetings, notice of meetings, voting, and quorum).
Both the 1955 Act and the Model Act have been amended over the years. The
A.B.A. adopted the Revised Model Nonprofit Corporation Act in 1987 (“Revised Model
Act”). See Subcomm. on the Model Nonprofit Corp. Law of the Bus. Law Section,
A.B.A., Revised Model Nonprofit Corporation Act (1988). The General Assembly then
amended the 1955 Act in 1993, which added many new provisions and re-codified the
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North Carolina Nonprofit Corporation Act (“1993 Act”) to mimic the Revised Model
Act in many ways. See 1993 N.C. Sess. Laws 1334.
For example, Section 6.20 of the Revised Model Act states:
(a) A member may resign at any time.
(b) The resignation of a member does not relieve the
member from any obligations the member may have to
the corporation as a result of obligations incurred or
commitments made prior to resignation.
Subcomm. on the Model Nonprofit Corp. Law of the Bus. Law Section, supra, at 112-
13. N.C.G.S. § 55A-6-30 provides:
(a) Any member may resign at any time.
(b) The resignation of a member does not relieve the
member from any obligations incurred or commitments
made to the corporation prior to resignation.
N.C.G.S. § 55A-6-30; see also 1993 N.C. Sess. Laws 1359. Accordingly, the General
Assembly was aware of the Revised Model Act at the time of the enactment of
N.C.G.S. § 55A-6-31, which was added as a part of the 1993 amendments. See 1993
N.C. Sess. Laws 1359. The 1993 session laws included N.C.G.S. § 55A-6-21, the
language of which mimics § 6.21 in the Revised Model Act, although N.C.G.S. § 55A-
6-21 ultimately became effective on 1 July 1994 as N.C.G.S. § 55A-6-31. See N.C.G.S.
§ 55A-6-31; 1993 N.C. Sess. Laws 1359, 1428.
When the General Assembly adopts verbatim some provisions of a model code
and rejects others, we assume that the General Assembly consciously chose to author
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its own alternate provisions. See Newbold v. Globe Life Ins. Co., 50 N.C. App. 628,
633-34, 274 S.E.2d 905, 908-09 (1981) (concluding that the General Assembly’s
rejection of one model provision in light its verbatim adoption of other Model Act
language “indicated a specific intent to reject the Model Act provision”).
Here, although the General Assembly adopted some parts of the Revised Model
Act’s § 6.21 in N.C.G.S. § 55A-6-31, other parts of N.C.G.S. § 55A-6-31 deviated from
the Revised Model Act’s language. N.C.G.S. § 55A-6-31(a) provides: “No member of a
corporation may be expelled or suspended, and no membership may be terminated or
suspended, except in a manner that is fair and reasonable and is carried out in good
faith.”
In contrast, the Revised Model Act’s § 6.21(b) provides:
(b) A procedure is fair and reasonable when either:
(1) The articles or bylaws set forth a procedure that
provides:
(i) not less than fifteen days prior written notice of the
expulsion, suspension or termination and the reasons
therefore; and
(ii) an opportunity for the member to be heard, orally or in
writing, not less than five days before the effective date
of the expulsion, suspension or termination by a person
or persons authorized to decide that the proposed
expulsion, termination or suspension not take place; or
(2) It is fair and reasonable taking into consideration all of
the relevant facts and circumstances.
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Subcomm. on the Model Nonprofit Corp. Law of the Bus. Law Section, supra, at 114.
Omitting these procedural considerations, the General Assembly copied almost all
the Revised Model Act’s language for the remaining sections of N.C.G.S. § 55A-6-31.
N.C.G.S. § 55A-6-31(b) and (c) are nearly identical to the Revised Model Act’s § 6.21(d)
and (e), respectively. Compare N.C.G.S. § 55A-6-31(b)-(c), with Subcomm. on the
Model Nonprofit Corp. Law of the Bus. Law Section, supra, at 114.3
The General Assembly had the opportunity to codify a notice or hearing
procedure within N.C.G.S. § 55A-6-31(a)—as expressly provided in the Revised Model
Act, upon which N.C.G.S. § 55A-6-31 is based—and declined to do so. Therefore, the
3
The General Assembly adopted the following The Revised Model Act provides:
language from the Revised Model Act:
(d) Any proceeding challenging an
(b) Any proceeding challenging an expulsion, suspension or termination, including
expulsion, suspension, or termination shall be a proceeding in which defective notice is alleged,
commenced within one year after the member must be commenced within one year after the
receives notice of the expulsion, suspension, or effective date of the expulsion, suspension or
termination. termination.
(c) A member who has been expelled or (e) A member who has been expelled or
suspended may be liable to the corporation for suspended may be liable to the corporation for
dues, assessments, or fees as a result of dues, assessments or fees as a result of
obligations incurred or commitments made by obligations incurred or commitments made prior
the member prior to expulsion or suspension. to expulsion or suspension.
N.C.G.S. § 55A-6-31(b)-(c) (emphasis added). Subcomm. on the Model Nonprofit Corp. Law of
the Bus. Law Section, supra, at 114 (emphasis
added).
N.C.G.S. § 55A-6-31(b) replaces “must” with The italicized portion of § 6.21(d) does not appear
“shall” and allows for members to challenge in N.C.G.S. § 55A-6-31(b).
decisions within one year of notice. The
italicized portion of N.C.G.S. § 55A-6-31(c) does
not appear in § 6.21(e) of the Revised Model Act.
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General Assembly did not intend to provide for the Revised Model Act’s notice or
hearing procedures in N.C.G.S. § 55A-6-31(a). See Newbold, 50 N.C. App. at 633-34,
274 S.E.2d at 908-09. As a result, we decline to hold that prior notice or a
participatory hearing is a per se requirement in all cases in order for a nonprofit
corporation to comply with the “fair and reasonable and . . . good faith” requirement
of N.C.G.S. § 55A-6-31(a).
Assuming arguendo that N.C.G.S. § 55A-6-31(a) as applied to the situation
here required the Club to provide Emerson with prior notice and a hearing—the lack
of which forms the basis of Emerson’s claim for compensatory and punitive
damages—Emerson failed to mitigate his damages allegedly resulting from the Club’s
failure to provide notice and a hearing. “Under the law in North Carolina, an injured
plaintiff must exercise reasonable care and diligence to avoid or lessen the
consequences of the defendant’s wrong. If plaintiff fails to mitigate his damages, ‘for
any part of the loss incident to such failure, no recovery can be had.’” Lloyd v. Norfolk
S. Ry. Co., 231 N.C. App. 368, 371, 752 S.E.2d 704, 706 (2013) (quoting Miller v.
Miller, 273 N.C. 228, 239, 160 S.E.2d 65, 73-74 (1968)). For example, when a plaintiff
asserts a claim for wrongful discharge from at-will employment, we have considered
the diligence with which a plaintiff seeks and accepts comparable employment. See
Blakeley v. Town of Taylortown, 233 N.C. App. 441, 449-50, 756 S.E.2d 878, 884-85
(2014). However, “the failure to mitigate damages is not an absolute bar to all
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recovery; rather, a plaintiff is barred from recovering for those losses which could
have been prevented through the plaintiff’s reasonable efforts.” Smith v. Childs, 112
N.C. App. 672, 683, 437 S.E.2d 500, 507 (1993) (emphasis in original).
Here, Emerson acknowledged that the Club offered him “an opportunity to
speak on [his] behalf,” and Emerson chose not to attend this proposed meeting on 15
February 2016. Rather, Emerson claimed that the meeting was “a disingenuous
effort to validate an invalid termination.” Even assuming that the Club’s failure to
provide Emerson with notice and an opportunity to be heard violated N.C.G.S. § 55A-
6-31(a), Emerson had an obligation to “lessen the consequences of the [the Club]’s
wrong.” See Lloyd, 231 N.C. App. at 371, 752 S.E.2d at 706. Under the
circumstances, attending the meeting and contesting the termination decision from
which Emerson’s compensatory damages supposedly flow would have been
reasonable. Emerson’s failure to mitigate the damages that he claims resulted from
the Club’s alleged violation of N.C.G.S. § 55A-6-31(a) was unreasonable and bars his
recovery here. See Lloyd, 231 N.C. App. at 371, 752 S.E.2d at 706; Smith, 112 N.C.
App. at 683, 437 S.E.2d at 507. The trial court did not err in entering summary
judgment on his claim for damages.
B. Declaratory Judgment Act
Emerson’s claims for declaratory judgments are rendered moot by our
determination that Emerson failed to mitigate his alleged damages. A cause of action
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Opinion of the Court
may be moot under the Declaratory Judgment Act when a litigant seeks only a
determination that some action was unlawful without seeking some form of relief
from the allegedly unlawful conduct. See Hindman v. Appalachian State Univ., 219
N.C. App. 527, 530, 723 S.E.2d 579, 581 (2012); Citizens Addressing Reassignment &
Educ., Inc. v. Wake Cty. Bd. of Educ., 182 N.C. App. 241, 246, 641 S.E.2d 824, 828
(2007). “[A] moot question is not within the scope of our Declaratory Judgment Act.”
Morris v. Morris, 245 N.C. 30, 36, 95 S.E.2d 110, 114 (1956). Unlike in federal courts,
where mootness is a jurisdictional issue, our state courts decline to answer moot
questions as an exercise of judicial restraint. In re Peoples, 296 N.C. 109, 147, 250
S.E.2d 890, 912 (1978). We apply a “traditional mootness analysis” to an action filed
under the Declaratory Judgment Act. Citizens, 182 N.C. App. at 246, 641 S.E.2d at
827. A moot question “presents only an abstract proposition of law,” and the
resolution of a moot question is one that would have “no practical effect on the
controversy.” Id. at 246, 641 S.E.2d at 828.
In Citizens, we declined to decide an “abstract proposition of law” where
plaintiffs sought a legal determination that a building was unlawful but did not seek
closure of the building. Id. at 827-28. There, plaintiffs sought a declaratory judgment
that the school board had violated N.C.G.S. § 115C-521(d) by entering into a lease
agreement and arranging for a modular school to be placed on land not owned by the
school board. Id. We held that the school was already operating and that a
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Opinion of the Court
declaration that the building was unlawful—absent some effort by the plaintiffs to
close the school—“would have no practical effect on the controversy” and was thereby
moot. Id.
Similarly, in Hindman, plaintiff professors at Appalachian State University
(“University”) sued their employer for its failure to pay the salary provided in
plaintiffs’ employment contracts. Hindman, 219 N.C. App. at 528, 723 S.E.2d at 579-
80. The professors sued for breach of contract and for a declaratory judgment that
the University had breached the employment contracts with the professors and other
similarly situated faculty members. Id. at 528, 723 S.E.2d at 580. However, in
Hindman, “[professors] did not seek any damages or any form of relief or redress for
the alleged breach of contract.” Id. We affirmed the trial court’s grant of summary
judgment in favor of the University because a legal determination that the University
had breached the employment contract would not “have any practical effect.” Id. at
530, 723 S.E.2d at 581 (quoting Citizens, 182 N.C. App. at 246, 641 S.E.2d at 827).
We noted that the “breach was in the past, is not alleged to be likely to recur, is the
only redress [professors] seek, and [professors] are barred from bringing further
action on this same claim or issue.” Id.
Here, Emerson’s first claim for relief in his Complaint states that “Emerson is
entitled to a declaratory judgment relating to the status of his membership in [the
Club].” Emerson’s second claim for relief states that “Emerson is entitled to a
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Opinion of the Court
declaratory judgment as to whether or not the Board can now conduct a curative
hearing in a manner that is fair and reasonable and carried out in good faith, having
previously terminated his membership in violation of [N.C.G.S. § 55A-6-31(a)].”
Were we to issue a judgment stating that the manner of Emerson’s
membership termination fell short of the “fair and reasonable and . . . good faith”
requirement in N.C.G.S. § 55A-6-31(a) or that post-termination hearings are
impermissible under N.C.G.S. § 55A-6-31(a), such determinations would have no
practical effect in this case. Unlike Hindman, where the plaintiff professors sought
a declaratory judgment without any other remedy or damages, Emerson does seek
compensatory and punitive damages alongside the declaratory judgments. See
Hindman, 219 N.C. App. at 528, 723 S.E.2d at 580. However, as discussed above,
Emerson failed to mitigate his purported damages and is therefore barred from
recovery. As a result, the questions about which Emerson sought a declaratory
judgment are moot notwithstanding his claim for damages.
Emerson seeks declaratory relief with respect to the manner of his termination
from the Club, and such a declaration would not alter the rights or obligations of the
parties.4 Similar to Citizens and Hindman, it may be possible here to identify a
4Emerson’s Complaint did not seek injunctive relief in the form of reinstated membership. Had
Emerson sought a mandatory injunction requiring reinstatement, the declaratory judgment may not
have been moot because this remedy would constitute further relief, which was lacking in Citizens and
Hindman. However, without deciding issues not present, we observe that the question of judicial
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Opinion of the Court
violation of N.C.G.S. § 55A-6-31(a), but the proposition would be abstract or academic,
like a judgment that a school building is unlawful or that a contract has been
breached when no further relief is sought. See Hindman, 219 N.C. App. at 530-31,
723 S.E.2d at 581; Citizens, 182 N.C. App. at 246, 641 S.E.2d at 827.
CONCLUSION
Emerson failed to mitigate his alleged damages and is barred from recovering
compensatory and punitive damages for the Club’s alleged violation of N.C.G.S. §
55A-6-31(a). Accordingly, the issues presented in Emerson’s requests for declaratory
judgments are moot, as a resolution of these questions would not have any practical
effect on the controversy, and we decline to address them. The trial court’s grant of
summary judgment in favor of the Club on each of Emerson’s claims is affirmed.
AFFIRMED.
Judge CALABRIA concurs.
Chief Judge McGEE concurs in result with separate opinion.
reinstatement of membership in a nonprofit corporation may implicate a nonprofit corporation’s First
Amendment associational rights. See Boy Scouts of Am. v. Dale, 530 U.S. 640, 647-48, 120 S. Ct. 2446,
2451 (2000) (“Government actions that may unconstitutionally burden [the right to associate] may
take many forms, one of which is ‘intrusion into the internal structure or affairs of an association’ like
a ‘regulation that forces the group to accept members it does not desire.’”) (quoting Roberts v. U.S.
Jaycees, 468 U.S. 609, 623, 104 S. Ct. 3244, 3252 (1984)).
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17-1149 – Emerson v. Cape Fear Country Club, Inc.
McGEE, Chief Judge, concurring in result with separate opinion.
I agree the trial court properly granted summary judgment in favor of
Defendant. However, I write separately to respectfully express my view that this
Court’s analysis should be limited to the issues specifically raised by Plaintiff’s
appeal. It is sufficient to conclude Plaintiff has failed to show that N.C.G.S. § 55A-6-
31(a) requires prior notice and a hearing as a matter of law.
Plaintiff asserts in his appellate brief that the termination of his club
membership (1) was neither fair and reasonable nor executed in good faith, as
required by N.C.G.S. § 55A-6-31(a); and (2) was inconsistent with various other
sources of non-binding authority. Plaintiff begins by noting the general proposition
that
[t]o determine whether the established facts [show a]
termination [was] in a manner that [was] fair and
reasonable and [was] carried out in good faith, this Court
is left to “[t]he first maxim of statutory construction
[which] is to ascertain the intent of the legislature. To do
this[,] this Court should consider the statute as a whole,
the spirit of the statute, the evils it is designed to remedy,
and what the statute seeks to accomplish.”
(quoting State v. Johnson, 298 N.C. 47, 56, 257 S.E.2d 597, 606 (1979)). Plaintiff then
states that, “[i]n doing so, [this] Court may look to other authorities of import,
including industry standards, decisions from other jurisdictions, and other recognized
authorities.”
EMERSON V. CAPE FEAR COUNTRY CLUB, INC.
McGEE, C.J., concurring in result with separate opinion
By its plain language, N.C.G.S. § 55A-6-31(a) does not provide that a
termination or suspension of membership will only be deemed “fair and reasonable”
and “carried out in good faith” if the member subject to termination or suspension is
afforded prior notice and an opportunity to be heard. Nevertheless, Plaintiff asks
this Court to hold that Defendant violated N.C.G.S. § 55A-6-31(a) as a matter of law
by not providing him “notice of the charges against him and a hearing or an
opportunity to respond to those charges prior to termination [of his membership][.]”
“‘The primary rule of statutory construction is that the intent of the [L]egislature
controls the interpretation of a statute.’” Belk v. Belk, 221 N.C. App. 1, 9, 728 S.E.2d
356, 361 (2012) (quoting Tellado v. Ti-Caro Corp., 119 N.C. App. 529, 533, 459 S.E.2d
27, 30 (1995)). “In ascertaining the legislative intent courts should consider the
language of the statute, the spirit of the statute, and what it seeks to accomplish.
Other indicia considered by this Court in determining legislative intent are the
legislative history of an act and the circumstances surrounding its adoption[.]”
Carter-Hubbard Pub’lg Co. v. WRMC Hosp. Operating Corp., 178 N.C. App. 621, 625,
633 S.E.2d 682, 685 (2006) (citations and quotation marks omitted).
Notably, in his appellate brief, Plaintiff offers no substantive discussion of “the
text, structure, and policy of [N.C.G.S. § 55A-6-31(a)],” the statute’s legislative
history, or the purpose of our General Assembly in enacting it. See Electric Supply
Co. v. Swain Electrical Co., 328 N.C. 651, 656, 403 S.E.2d 291, 295 (1991). Plaintiff
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EMERSON V. CAPE FEAR COUNTRY CLUB, INC.
McGEE, C.J., concurring in result with separate opinion
asserts various public policy arguments why corporations should be required to
provide prior notice and an opportunity to be heard before suspending or terminating
a membership, but “these arguments are more properly directed to the [L]egislature.
The sole issue before this Court is one of statutory construction,” see State v. Anthony,
351 N.C. 611, 618, 528 S.E.2d 321, 325 (2000), and we are not persuaded that
N.C.G.S. § 55A-6-31(a) implicitly imposes per se notice and hearing requirements.
In support of his argument that prior notice and an opportunity to be heard
are mandatory under N.C.G.S. § 55A-6-31(a), Plaintiff relies entirely upon the
following sources of authority: (1) guidelines and recommendations published by the
Club Managers Association, a professional trade association; (2) case law from other
jurisdictions, interpreting and applying non-North Carolina law and legal principles;
(3) Robert’s Rules of Order; and (4) statements purportedly made by attorneys who
were members of Defendant’s Board during internal discussions about Plaintiff’s
termination. These sources are insufficient to support a violation of N.C.G.S. § 55A-
6-31(a). Plaintiff has not argued, for example, that the General Assembly intended
N.C.G.S. § 55A-6-31(a) to reflect or incorporate the “industry standards” he cites.
Defendant’s alleged failure to follow Robert’s Rules of Order, and the internal
discussions of its own attorneys regarding the termination of Plaintiff’s membership,
likewise lack relevance to the question of statutory construction. Plaintiff does not
explain why Defendant’s alleged violation of Robert’s Rules of Order constituted a
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EMERSON V. CAPE FEAR COUNTRY CLUB, INC.
McGEE, C.J., concurring in result with separate opinion
violation of N.C.G.S. § 55A-6-31(a); Plaintiff argues only that Defendant “failed to
follow its [own] requirements or guidelines.” Similarly, the opinions expressed by
attorneys serving on Defendant’s Board that, prior to the termination of Plaintiff’’s
membership, “there should be some due process[,]” and that the Board “may want to
allow [Plaintiff] an opportunity to . . . speak on his actions[,]” do not establish that
such measures were mandated by N.C.G.S. § 55A-6-31(a), or that the Board violated
the statute by deciding not to follow those recommendations. Finally, while this
Court may consider the non-binding decisions of other jurisdictions if we find such
authority “instructive[,]” see Carolina Power & Light Co. v. Employment Sec. Comm’n
of N.C., 363 N.C. 562, 569, 681 S.E.2d 776, 780 (2009), the out-of-state and federal
cases cited by Plaintiff “have very little persuasive weight” here, in light of various
factual, procedural, and legal distinctions among the cases. See Wal-Mart Stores E.,
Inc. v. Hinton, 197 N.C. App. 30, 44, 676 S.E.2d 634, 645 (2009).
Plaintiff has failed to identify any controlling or persuasive authority to
support his proposed construction of N.C.G.S. § 55A-6-31(a) as imposing per se notice
and hearing requirements and, as discussed by the majority, aspects of the statute’s
legislative history suggest our General Assembly intentionally omitted per se notice
and hearing requirements from the plain language of the statute. This concludes our
inquiry. It is unnecessary to address Plaintiff’s alleged failure to mitigate damages,
since Plaintiff’s claim for damages is premised upon a violation of N.C.G.S. § 55A-6-
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EMERSON V. CAPE FEAR COUNTRY CLUB, INC.
McGEE, C.J., concurring in result with separate opinion
31(a) and, absent a statutory violation, those claims necessarily fail. It is also
important to note that our holding in the present case does not preclude a finding
that, under the facts and circumstances of a particular case, a lack of prior notice
and/or hearing could violate the “fair and reasonable” and “good faith” language in
N.C.G.S. § 55A-6-31(a). Plaintiff has simply failed to persuade this Court that the
statute mandates prior notice and a hearing in all instances.
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