Berke v. Fid. Brokerage Servs.

270 N.C.App. 374

841 S.E.2d 592

Julie BERKE, Plaintiff,

v.FIDELITY BROKERAGE SERVICES, the Estate of Gary Ian Law, and Aman Masoomi, Individually and as Sole Heir and Executor of the Estate of Sharon Lee Day, Defendants.

No. COA19-641

Court of Appeals of North Carolina.

Filed: March 17, 2020

Tillman, Whichard & Cagle, PLLC, by Willis P. Whichard, Chapel Hill, and Sarah Elizabeth Tillman, for the Plaintiff-Appellant.

Roberti, Wicker, Lauffer & Cinski, P.A., Durham, by R. David Wicker, Jr., for the Defendant-Appellees.

BROOK, Judge.

Julie Berke ("Plaintiff") appeals from judgment entered upon a jury verdict finding that the estate of Gary Law, her former husband, is the beneficiary of certain retirement accounts. We hold that the trial court erred by submitting this issue to the jury because there was insufficient evidence that anyone other than Plaintiff was the beneficiary of these accounts at the time of Mr. Law's death. It was therefore error to deny Plaintiff's motion for directed verdict on this issue and her motion for judgment notwithstanding the verdict. Accordingly, we reverse the trial court's judgment and award of costs.

I. Background

Plaintiff was married to Mr. Law on 24 May 1992. The couple separated on 25 January 2014, entered a Separation and Property Settlement Agreement ("the Separation Agreement") on 12 February 2015, and then divorced on 9 April 2015. Mr. Law died on 17 September 2015 and his sister and sole heir, Sharon Day, died on 2 December 2015. When Mr. Law died, he owned three retirement accounts in the custody of Fidelity Brokerage Services LLC ("Fidelity").

On 6 May 2016, Plaintiff initiated an action for a declaratory judgment that she was the beneficiary of Mr. Law's retirement accounts at Fidelity at the time of his death. In a 2 October 2017 answer, Mr. Law's estate admitted that the Separation Agreement entered into by Plaintiff and Mr. Law expressly provided that there was no release of property and estate rights with respect to any beneficiary designations existing at the time of the execution of the Agreement or made thereafter; that Mr. Law never made any changes to the beneficiary designations for his Fidelity accounts after the execution of the Agreement; and that Plaintiff therefore remained the beneficiary of Mr. Law's accounts at Fidelity ending in numbers 4418, 1424, and 2628 at the time of his death. Mr. Law's estate thus conceded in its 2 October 2017 answer that Plaintiff was entitled to a declaratory judgment that she was the beneficiary of the Fidelity accounts at the time of Mr. Law's death.

The executor and sole heir of Mr. Law's sister, however, did not so concede. In answers filed on 23 June 2016, 27 October 2017, and 3 November 2017, the executor and sole heir of Ms. Day, Aman Masoomi, disputed whether Plaintiff was entitled to the assets in the Fidelity accounts in both his personal capacity and as Ms. Day's executor. If the accounts had no beneficiary at the time of Mr. Law's death, Mr. Masoomi had an interest in the accounts: (1) he was Ms. Day's sole heir; (2) Ms. Day was Mr. Law's sole heir; and (3) Ms. Day and Mr. Law had both since passed away.

In an order entered 3 April 2018 denying Plaintiff's partial motion for summary judgment on the issue of whether she was the beneficiary of the accounts, the trial court determined that there was a genuine issue of material fact as to whether Mr. Masoomi had an interest in the accounts. Before the court at this summary judgment hearing were documents that purported to be letters from Mr. Law and Ms. Day to Fidelity. Each of these letters purportedly pre-dated the death of the respective decedent, and each appeared to attempt to change the beneficiary designations of Mr. Law's retirement accounts.¹

However, ruling on a motion in limine in August 2018, the court determined that there was a genuine issue as to the authenticity of these documents. And, before trial began, the parties stipulated that (1) "Fidelity ha[d] not been able to locate any records in its custody and control that indicate that Fidelity received any written changes, modifications, or revocations from Gary Ian Law to the beneficiary designation for account #1424, #4418 prior to September 17, 2015"; and (2) "[o]n September 15, 2015, Julie L. Berke-Law was listed in Fidelity's records as the designated beneficiary of Gary Ian Law's account #4418, #1424, and #2628." In granting Plaintiff's motion and excluding the letters from the jury's consideration, the trial court found not only that there was a genuine issue as to the authenticity of the documents, but also that, based on the parties’ pretrial stipulations regarding the absence of any record communications changing the beneficiary designations for the accounts and receipt of the same by Fidelity, "the probative value of the letters [was] outweighed by the unfair prejudice they would offer to the jury."

The case came on for trial before the Honorable Carolyn J. Thompson in Durham County Superior Court on 10 September 2018. Judge Thompson presided over a six-day trial. At the close of the evidence, Plaintiff moved for a directed verdict on the issue of whether she was the beneficiary of the retirement accounts, which the trial court denied. On 21 September 2018, the jury returned a verdict in favor of Mr. Masoomi, finding in relevant part that Mr. Law's estate was the beneficiary of the accounts, not Plaintiff. Plaintiff moved for judgment notwithstanding the verdict, which the trial court denied. The trial court entered a judgment upon the verdict on 10 October 2018.

Plaintiff entered timely written notice of appeal on 18 October 2018.

II. Analysis

The dispositive issue in this appeal is whether the trial court erred in concluding that there was sufficient evidence that someone other than Plaintiff was the beneficiary of Mr. Law's retirement accounts when it submitted this question to the jury, denying Plaintiff's motion for directed verdict.² Viewing the evidence in the light most favorable to Mr. Masoomi, as we are required to do, we hold that the admissible, record evidence at the time Plaintiff moved for a directed verdict was insufficient to support a finding by the jury that anyone other than Plaintiff was the beneficiary of the accounts. The trial court therefore erred in denying Plaintiff's motion for directed verdict on this issue and motion for judgment notwithstanding the verdict after the jury returned a verdict in favor of Mr. Masoomi.

"Under Rule 50 of the North Carolina Rules of Civil Procedure, a party may move for a directed verdict at the close of the evidence offered by the opponent and at the close of all of the evidence." Buckner v. TigerSwan, Inc. , 244 N.C. App. 385, 390, 781 S.E.2d 494, 498 (2015). The motion is "only [ ] proper in a jury trial." Id. (citation omitted). It "tests the sufficiency of the evidence to go to the jury and to support a verdict for the non-moving party." McMahan v. Bumgarner , 119 N.C. App. 235, 237, 457 S.E.2d 762, 763 (1995) (citation omitted). Thus, "[a] motion for a directed verdict presents the same question for both trial and appellate courts: Whether the evidence, taken in the light most favorable to the nonmovant, is sufficient for submission to the jury." Smith v. Moody , 124 N.C. App. 203, 205, 476 S.E.2d 377, 379 (1996) (citation omitted).

Likewise, "[a] motion for judgment notwithstanding the verdict presents the question of whether the evidence was sufficient for submission to the jury." Loftis v. Little League Baseball, Inc. , 169 N.C. App. 219, 221, 609 S.E.2d 481, 483 (2005) (citation omitted). Just as a motion for directed verdict "tests the sufficiency of the evidence to go to the jury," McMahan , 119 N.C. App. at 237, 457 S.E.2d at 763, so too, "a motion for judgment notwithstanding the verdict challenges[ ] whether evidence presented at trial [was ] legally sufficient to go to the jury," Hinnant v. Holland , 92 N.C. App. 142, 144, 374 S.E.2d 152, 154 (1988) (emphasis added). Its resolution requires consideration of this question after the jury has already considered the evidence and rendered a verdict rather than before being charged. Kaperonis v. Underwriters , 25 N.C. App. 119, 123, 212 S.E.2d 532, 535 (1975). "[O]ur standard of review for a judgment notwithstanding the verdict is the same as that for a directed verdict; that is, whether the evidence was sufficient to go to the jury." Papadopoulos v. State Capital Ins. Co. , 183 N.C. App. 258, 262, 644 S.E.2d 256, 259 (2007) (citation omitted).

In the present case, Paragraph 4 of the Separation Agreement entered into by Plaintiff and Mr. Law on 12 February 2015 provides as follows:

4. RELEASE OF PROPERTY AND ESTATE RIGHTS. Except as otherwise provided herein, each party hereby waives, relinquishes, renounces and quitclaims unto the other any and all rights, title, interest and control he or she may now have or shall hereafter acquire under the present or future laws of any jurisdiction, in, to or over the person, property or estate of the other, arising by reason of their marital relationship or under any previously executed instrument or will, made by either of them, including, but not limited to, dower, courtesy, statutory allowance, widow's allowance, homestead rights, right to take in event of intestacy, right to any share as the surviving spouse, any right of election, right to take against the last will and testament of the other or to dissent therefrom, right to act as administrator or executor of the estate of either, and any and all rights, title or interest of any kind in and to any said property or estate of any kind of the other, except as to Wife's marital interest in the Rollover IRA #2628 held with Fidelity in Husband's name as set forth in Paragraph 8.F. This provision shall not apply to any Social Security benefits the parties may have by reason of their marriage to each other, to any real property retained by the parties as tenants by the entirety so long as

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