An Important Tip On Appealing A Decision From The NC Business Court

by Brooks Pierce
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The Business Court is electronic.  Paper copies of documents are not filed with the Business Court.  So when you e-file a Notice of Appeal, is that sufficient for purposes of Rule 3 of the NC Rules of Appellate Procedure?

Let's look at the Rule first.  It says that:

Any party entitled by law to appeal from a judgment or order of a superior or district court rendered in a civil action or special proceeding may take appeal by filing notice of appeal with the clerk of superior court and serving copies thereof upon all other parties within the time prescribed by subsection (c) of this rule.

N.C. R. App. Pro. 3(a)(emphasis added).

The Plaintiff in Ehrenhaus v. Baker, 2014 NCBC 30 wanted to file a cross appeal from Judge Murphy's decision awarding attorneys' fees to his lawyers in his lawsuit over Wachovia's merger with Wells Fargo.  If you need to be refreshed on that ruling, I wrote about it in April.

Since one of the individuals objecting to the fee award had already filed a notice of appeal, the Plaintiff had ten days after that to file his own notice of appeal.  N.C. R. App. Pro. 3(c).

The tenth day was May 2, 2014.  Plaintiff e-filed his notice of appeal with the Business Court on April 30, 2014. 

Was the notice of appeal timely?  No, said Judge Gale, as the notice of appeal was not filed with the Mecklenburg County Clerk of Superior Court until May 15, 2014.

The decision hinged on whether the e-filing, which had been delivered to the "Clerk of Court" at the Business Court, satisfied the filing requirement of Appellate Rule 3 of being directed to the "clerk of superior court."  (Note that the Business Court's electronic filing system produces a Notice of Electronic Filing which includes a reference to service on "Clerk of Court,"  which actually is the email address of the Court's law clerk in Raleigh.)

Plaintiff argued that the Business Court was a separate Superior Court within the North Carolina General Court of Justice and that he had therefore properly filed his notice of appeal with the Business Court "Clerk of Court."  Judge Gale rejected this argument, and observed that "the Business Court does not have its own clerk of court."  Op. ¶11 (emphasis added).

While the Court was "sympathetic" to Plaintiff's argument that he had been misled by the electronic filing system into believing that he had properly filed his notice of appeal, Judge Gale ruled that he could not "overlook the plain language of Appellate Rule 3 that requires a notice of appeal to be filed with the clerk of superior court within the time prescribed by Appellate Rule 3(c)."  Op. ¶13.

So Judge Gale dismissed Plaintiff's appeal.  But why did the Business Court have the authority to dismiss the appeal?  The answer is that Appellate Rule 25 "allows the trial court to dismiss an appeal if the appellant failed to give notice of appeal within the time allowed by"  Appellate Rule 3.  Landingham Plumbing & Heating of North Carolina, Inc. v. Funnell, 102 N.C. App. 814, 815, 403 S.E.2d 604, 605-06 (1991).

I don't know why Judge Gale didn't reference Business Court Rule 8.1 in his Opinion.  That Rule makes it clear that all filings with the Business Court must be made  with the Clerk of Superior Court in the judicial district where the case is pending.  It says that "all documents and materials submitted to the Business Court shll also be filed wihin five (5) business days with the Clerk of Superior Court in the judicial district in which the matter is pending."

Is an appeal of this ruling about an appeal a possibility?  Maybe, as the Plaintiff may have a legitimate argument that he was misled by the Business Court's filing system.  Judge Gale observed that the Court has corrected the "default" in the system that recognized the Court's "Clerk of Court."  He said that:

Prior to the briefing on the Motion, the court was not cognizant that the Notice of Electronic Filing email in this and other actions refers to the notice as having been sent to “Clerk of Court” by email to raleigh.clerk@aoc.nccourts.org.  That email address is for the law clerk resident in the Raleigh chambers of the Honorable John R. Jolly, Jr., Senior Special Superior Court Judge for Complex Business Cases. The court believes this application was added as a default by the system administrator. This default has now been removed.

Op. ¶12.

So if you are filing an appeal from a Business Court ruling, make sure to file a paper copy in the office of the Clerk in the County in which the case was filed within the time period set in Appellate Rule 3.

 

 

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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