Catawba County Horsemen's Ass'n v. Deal

WALKER, Judge. Defendant argues: (1) the trial court committed reversible error in granting plaintiff’s motion for summary judgment because a genuine issue of material fact existed; (2) the trial court did not view the pleadings, discovery, affidavits and other papers submitted in the light most favorable to defendant when granting plaintiff’s motion for summary judgment; and (3) the trial court erred in granting plaintiff’s motion for summary judgment because it did not consider G.S. 55A-26.2(c). We find it expedient to consolidate these issues and to address solely the question of whether the trial court properly granted plaintiff’s motion for summary judgment. Rule 56 of the North Carolina Rules of Civil Procedure provides that summary judgment will be granted “if 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.” The movant has the burden of establishing a lack of any triable fact. Roumillat v. Simplistic Enterprises, Inc., 331 N.C. 57, 414 S.E.2d 339 (1992); Pembee Mfg. Corp. v. Cape Fear Constr. Co., 313 N.C. 488, 329 S.E.2d 350 (1985). The movant may meet this burden by proving that an essential element of the opposing party’s claim is nonexistent, or by showing through discovery that the opposing party cannot produce evidence to support an essential element of his claim or cannot surmount an affirmative defense which would bar the claim. Roumillat v. Simplistic Enterprises, Inc. at 63, 414 S.E.2d at 342, quoting Collingwood v. G. E. Real Estate Equities, 324 N.C. 63, 376 S.E.2d 425 (1989). In order to satisfy this burden “an adverse party may not rest upon the mere allegations or denials of his pleading, but his response, by affidavits or as otherwise provided in this rule, must set forth specific facts showing that there is a genuine issue for trial.” G.S. 1A-1, Rule 56(e). However, the trial court must draw all inferences of fact against the movant and [217] in favor of the nonmovant. Collingwood v. G. E. Real Estate Equities at 66, 376 S.E.2d at 427. In opposition to plaintiff’s motion for summary judgment defendant proffered, in addition to Bill Dellinger’s affidavit, a copy of the Articles of Amendment to plaintiff’s charter naming Harold Deal as president and Elberta Gragg as secretary, and the minutes of the special meeting called by “President Harold Deal” on 26 August 1989 purporting to authorize the conveyance. The relevant portions of Mr. Dellinger’s affidavit stated that he had made several inquiries of Max Townsend and unnamed former members of plaintiff organization but that no one could recount who the officers of plaintiff were or had been. This evidence was not competent to overcome plaintiff’s motion for summary judgment, however, and did not set forth specific facts showing the existence of a genuine issue for trial pursuant to Rule 56. We therefore agree with the trial court that summary judgment was proper. See Speck v. North Carolina Dairy Foundation, Inc., 311 N.C. 679, 319 S.E.2d 139 (1984); Morgan v. Musselwhite, 101 N.C.App. 390, 399 S.E.2d 151, disc. review denied, 329 N.C. 498, 407 S.E.2d 536 (1991). Additionally, we find summary judgment to have been proper on the ground that the deed of 14 August 1989 was void ab initio. Defendant contends in its brief that plaintiff is a non-profit organization governed by Chapter 55A of the North Carolina General Statutes. Plaintiff does not dispute this assertion. The relevant statute, G.S. 55A-43, thereby provides: (b) [The] sale, lease, exchange or other disposition of all, or substantially all, the property and assets of a corporation-may be made upon such terms and conditions and for such consideration.. . as may be authorized in the following manner: (1) Where there are members having voting rights, the board of directors shall adopt a resolution recommending such sale, lease, exchange or other disposition and directing that it be submitted to a vote at a meeting of members having voting rights. (2) Where there are no members, or no members having voting rights, a sale, lease exchange or other disposition of all, or substantially all, the property and assets of a corporation shall be authorized upon receiving the vote of a majority of the directors in office. [218] Defendant argues it duly acquired the subject property since Mr. Deal and Ms. Teague, the last recorded president and secretary of plaintiff, signed the deed transferring the property to defendant in their capacities as president and secretary after notice of a special meeting was given. We cannot agree with defendant and uphold the transaction as having been authorized by the board of directors or members of plaintiff organization since at the time the deed was executed Mr. Deal was not president and Ms. Teague was not secretary, as is evidenced by the corporate minutes. Thus, Mr. Deal and Ms. Teague signed the deed without the authorization necessary under G.S. 55A-43 to effectuate the conveyance of the corporate real property and the deed was void ab initio. Insofar as a corporate seal was affixed to the deed, defendant argues it has established a prima facie case entitling it to a jury determination on the merits and summary judgment was improper. M. B. Haynes Electric Corp. v. Justice Aero Co., 263 N.C. 437, 139 S.E.2d 682 (1965); Staples v. Carter, 5 N.C.App. 264, 168 S.E.2d 240 (1969). G.S. 55A-26.2 states in pertinent part: (c) Deeds . . . and other instruments purporting to be executed, heretofore or hereafter, by a corporation, foreign or domestic, and bearing a seal which purports to be the corporate seal, setting forth the name of the corporation engraved, lithographed, printed, stamped, impressed upon, or otherwise affixed to the instrument, are prima facie evidence that the seal is the duly adopted corporate seal of the corporation, that it has been affixed as such by a person duly authorized to do so, that such instrument was duly executed and signed by persons who were officers or agents of the corporation acting by authority duly given by the board of directors, that any such instrument is the act of the corporation, and shall be admissible in evidence without further proof of execution. We cannot conclude that the corporate seal in question, which was clearly hand-drawn, falls within the definition and intended meaning of G.S. 55A-26.2(c). For the foregoing reasons, the trial court properly granted summary judgment for the plaintiff and dismissed defendant’s counterclaim. Affirmed. Judges Lewis and Wynn concur.