Bradley v. Tapia

857 S.E.2d 367 (Table)

Ronald BRADLEY, Plaintiff,

v.Lorraine TAPIA, Defendant.

No. COA20-453

Court of Appeals of North Carolina.

Filed May 4, 2021

Brinkley Walser Stoner, PLLC, by Emery Drew Nelson, for the Plaintiff-Appellee.

Surratt Thompson & Ceberio PLLC, by Christopher M. Watford, for the Defendant-Appellant.

JACKSON, Judge.

¶ 1 Lorraine Tapia ("Defendant") appeals from the trial court's order awarding Ronald Bradley ("Plaintiff") possession of a residence located in Winston-Salem (the "Winston-Salem Property") in an action for summary ejectment. We hold that the trial court correctly concluded that the relationship between the parties was that of landlord and tenant. Because the right of Plaintiff, as landlord, to maintain this action comes within the terms of the summary ejectment statute, we affirm the order of the trial court.

I. Background

¶ 2 For approximately six years, Plaintiff and Defendant were in an on-again-off-again romantic relationship. They also did business together. Plaintiff would acquire properties and Defendant would renovate the properties for resale.

¶ 3 In 2016, Plaintiff purchased the Winston-Salem Property by general warranty deed. Plaintiff financed the purchase price of the property with a mortgage secured by a deed of trust on which he was the sole obligor. The promissory note accompanying the deed of trust also only identified Plaintiff as the borrower.

¶ 4 However, the parties shared access to a joint bank account for the Winston-Salem Property and each agreed to pay half of the Winston-Salem Property expenses, including mortgage and utility payments. Defendant was also listed as a policyholder on the homeowners’ insurance and as the primary homeowner on the homebuyers’ warranty. When unrelated litigation arose between property owners in the community in which the Winston-Salem Property is located, Defendant paid for half of the costs of the litigation.

¶ 5 In 2018, the parties experienced a break in their romantic relationship and Plaintiff sent Defendant an eviction notice. Days after receiving this notice, the parties reconciled, and the issue of eviction did not arise again until 28 June 2019, when Plaintiff provided Defendant with oral notice to vacate. As a result of Defendant's failure to pay her portion of the Winston-Salem Property expenses and vacate the premises, Plaintiff filed a complaint for summary ejectment on 13 August 2019 in the Small Claims Division of Davidson County District Court.

¶ 6 Both parties agree that the Winston-Salem Property was initially purchased for residential purposes; however, Defendant contends that the purpose changed to income-producing after she had been living there for some time. Furthermore, Defendant contends that a partnership existed between the parties and that her contributions to the expenses of the Winston-Salem Property were not rent but instead, were partnership expenses. Plaintiff, on the other hand, contends that the parties had a landlord-tenant relationship in which Defendant resided in the house on a month-to-month tenancy and owed him rent.

¶ 7 The matter came on for hearing on 17 September 2019 before Magistrate C. H. Smith in small claims court. After hearing the evidence, the magistrate issued a judgment in favor of Plaintiff for possession of the premises but declined to enter judgment as to the amount of rent owed. Defendant timely filed a notice of appeal from the magistrate's judgment.

¶ 8 On 4 November 2019, the matter came on for a de novo hearing before the Honorable Carlos Jane in Davidson County District Court. Judge Jane presided over a one-day bench trial. The trial court ultimately concluded that "a Landlord/Tenant relationship exist[ed] between Plaintiff in the capacity as owner/Landlord and Defendant in the capacity as a tenant with respect to the subject property." The trial court therefore awarded possession of the Winston-Salem Property to Plaintiff. Like the small claims court magistrate, the trial court was unable to determine how much rent Defendant owed Plaintiff, if any.

¶ 9 Defendant timely appealed to our Court.

II. Standard of Review

¶ 10 In summary ejectment actions, "[a] trial court's findings of fact are binding on appeal if supported by competent evidence. Unchallenged findings of fact are also binding on appeal. However, we review questions of law de novo. " Durham Hosiery Mill Ltd. P'ship v. Morris , 217 N.C. App. 590, 592, 720 S.E.2d 426, 427 (2011) (internal citations omitted). The issue of subject matter jurisdiction can be raised at any time, and presents a question of law, which we review de novo. Banks v. Hunter , 251 N.C. App. 528, 531, 796 S.E.2d 361, 365 (2017).

III. Analysis

A. Challenged Findings

¶ 11 Defendant raises a number of challenges to the trial court's findings of fact. Defendant challenges the evidentiary basis for several findings of fact and argues that several findings of fact were summations of arguments, mere recitations of testimony, or erroneous and mischaracterized conclusions of law. We address the evidentiary challenges first.

1. Evidentiary Challenges

a. Findings of Fact 15 and 26

¶ 12 Defendant challenges the evidentiary basis for findings of fact 15 and 26, in which the trial court found:

15. Defendant breached [her] obligation [to pay half of the expenses] by failing to fully and timely pay one-half of the house, including mortgage payments and utilities, etc.

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26. The Court could not determine the extent of the actual breach or a monetary amount that Plaintiff was owed with the evidence presented.

Defendant contends that these findings were not supported by competent evidence. We disagree.

¶ 13 During the 4 November 2019 de novo hearing before Judge Jane in district court, Plaintiff testified as follows regarding Defendant's failure to contribute her share of the expenses:

Q: Okay. Did you-all have any discussion about her staying with you and any upkeep or maintenance or costs that she was going to pay, or were you just going to allow her to live there free of charge?

A: No. So the deal was she would pay half the mortgage and half of the bills and utilities.

Q: Okay. Approximately what was that monthly mortgage payment and her half of that obligation?

A: It was approximately $2200, so half of that would have been [$]1100.

Q: And did she, from time to time, make payments of that half of the mortgage payment?

A: In the beginning, yes, she did from time to time.

Q: Okay. About when did she stop making payments on that mortgage?

A: Hard to say for sure, but it was probably sometime in 2018.

Although Defendant admitted to agreeing to contribute to the expenses, including the mortgage, she testified that Plaintiff had also agreed to "pay [her] back for many things[,]" such as gifts for Plaintiff's family members she paid for and for which she would receive credit against her share of the expenses.

¶ 14 We hold that the trial court's finding that Defendant breached her obligation to fully and timely pay half of the expenses was supported by competent evidence. The trial court was free to credit Plaintiff's testimony that Defendant did not pay her share of the expenses. Bank statements submitted by Defendant showed only sporadic contributions by Defendant, corroborating Plaintiff's testimony. The parties’ testimony also demonstrates that Plaintiff accepted in-kind payments from Defendant. This testimony, coupled with the absence of any evidence to suggest how much money Defendant owed in rent, supported finding of fact 26, relating to the court's inability to determine the amount Plaintiff was owed for rent.

b. Finding of Fact 16

¶ 15 Defendant also challenges the trial court's sixteenth finding of fact, in which the court found:

16. Plaintiff made demand upon Defendant for payment and Defendant failed to cure the breach.

Defendant contends that the evidence did not support this finding. Specifically, Defendant argues that Plaintiff's "couch conversation" about relocating to Charlotte did not amount to adequate notice to vacate and had nothing to do with nonpayment.

¶ 16 As noted previously, in September 2018, Plaintiff gave Defendant an eviction notice. The notice was in the form of a letter. In the letter, Plaintiff informed Defendant that her "month to month tenancy ... will terminate on October 2, 2018." Plaintiff also testified that in June 2019 he had a conversation with Defendant in which he informed her that he would be taking a job in Charlotte and she needed to find a new place to live. Although Defendant denied that this conversation ever took place, the trial court was free to discredit her denial. Accordingly, we hold that the testimony related to the eviction notice and the June 2019 conversation was competent to support the trial court's sixteenth finding of fact.

c. Finding of Fact 21

¶ 17 Next, Defendant challenges portions of finding of fact 21, in which the trial court found:

21. Defendant testified that the property was to become income producing along with the other investment properties described above. However, in Paragraph #22 of the verified complaint filed in 16 CVS 2543, Defendant Tapia plead the property was not to be income producing, inconsistent and in direct contradiction to her testimony in this action that the property was designed to be income producing.

¶ 18 Defendant argues that portions of this finding are unsupported by the greater weight of the evidence and that the finding mischaracterizes her testimony. Specifically, Defendant objects to the final clause of the finding, in which the trial court characterized her testimony as inconsistent and contradictory.

¶ 19 During the 4 November 2019 hearing, the following colloquy related to Defendant's statements in other litigation transpired:

Q: Now in your lawsuit that you filed in Superior Court, did you state in there in the verified complaint that "The parties agreed [the Winston Salem Property] would not be income producing, the parties agreed to split monthly mortgage payments, with Plaintiff –" that

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