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Hewitt v. Hewitt

Court of Appeals of North Carolina

April 4, 2017

GAIL LEE HEWITT, Plaintiff,
v.
ROBIN LEE HEWITT, individually and as Trustee of the ROBIN LEE HEWITT Revocable Trust dated August 12, 2011, Defendant.

          Heard in the Court of Appeals 24 May 2016.

         Appeal by Defendant from judgment entered 20 July 2015 by Judge Ebern T. Watson, III, in Brunswick County, No. 14 CVS 967 Superior Court.

          The Del Ré Law Firm, PLLC, by Benedict J. Del Ré, Jr., for Plaintiff-Appellee.

          Shipman & Wright, LLP, by Kyle J. Nutt, for Defendant-Appellant.

          INMAN, Judge.

         Robin Lee Hewitt, individually and as trustee of the Robin Lee Hewitt Revocable Trust ("Defendant"), appeals a judgment resulting from a jury verdict in favor of Gail Lee Hewitt ("Plaintiff") on a claim of constructive fraud. Defendant contends the trial court erred in denying her motions for directed verdict and her motion from judgment notwithstanding the verdict (JNOV), or in the alternative, motion for a new trial. After careful review, we hold that the trial court erred in denying the motions for directed verdict and JNOV, and reverse the judgment.

         I. Factual & Procedural Background

         This appeal arises out of a 2010 sale of property located in Brunswick County ("the Transaction") from Plaintiff and her late husband, Douglas Hewitt ("Mr. Hewitt") (collectively, "the Hewitts"), to their daughter, Defendant. The evidence at trial, considered in the light most favorable to Plaintiff, tends to show the following:

         Defendant is one of the Hewitts' three daughters. At age sixteen, Defendant left the family home. She lived in California for twenty-seven years preceding the Transaction.

         In 1987, the Hewitts purchased a tract of land in Supply, North Carolina from Mr. Hewitt's mother, Mary Hewitt. The deed explicitly reserved a life estate for Mary Hewitt in the property. Following the death of Mary Hewitt, the Hewitts built a new house ("the Property") on the land in 2005.

         In May 2009, the Hewitts decided to enter a home equity conversion mortgage, also known as a reverse mortgage, on the Property. Attorney Richard Green ("Green") and his closing coordinator, Rhonda Caison ("Caison"), represented the Hewitts in the closing. Green was "trusted lawyer" and "friend" of Plaintiff, whom she had known for fifteen years and felt "confident" using. The Hewitts attended counseling sessions through a federal government agency and received informational documents regarding the loan's cost and the financial implications. On 12 June 2009, the Hewitts entered into the reverse mortgage from which they received a loan for $168, 000 from RBC Bank, borrowed against their equity in the Property. At the time they entered into the reverse mortgage closing, an $80, 989.52 lien on the Property with Chase Home Mortgage was recorded.

         In closing on the reverse mortgage, the Hewitts received the proceeds of the loan from RBC Bank, retired the debt to Chase Home Bank, placed a new deed of trust on the record, and signed a new promissory note securing the new loan. The note was payable 2 May 2086. The loan covered the $8, 446 closing costs, provided the Hewitts a loan advance of $25, 880.70, and allowed them to remain in their home, without making mortgage payments, for the rest of their lives. In the event that either spouse lived away from the Property for over a year, the Property was sold, or both spouses died, the reverse mortgage would terminate and the loan would become due. The Hewitts remained responsible for paying the maintenance, insurance, and taxes on the Property.

         At the time the Hewitts entered into the reverse mortgage, Defendant lived in California. She allegedly told her parents by phone that the reverse mortgage was a "big mistake." However, Plaintiff admitted that she also received "advice independent of [Defendant] on whether or not the reverse mortgage was a good deal[.]"

         In May or June of 2010, in a telephone conversation from her residence in California, Defendant offered to buy the Property from her parents. Defendant stated she could buy the Property the following year, allegedly telling her parents that "[the house] will still be in the family, " "you'll be okay[, ]" and "[e]verything will be the same except that I'll own the house." A few months later, in September or October of 2010, Defendant called her parents and said she was prepared to purchase the Property.

         Plaintiff investigated the value of the Property in anticipation of selling it to Defendant. She consulted "four or five" real estate agencies but never requested a professional appraisal. Plaintiff referred Defendant to ...


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