in the Court of Appeals 22 February 2018
by plaintiff from order entered 18 April 2017 by Judge Mary
Ann Tally in Cumberland County, No. 13 CVS 6416 Superior
Attorney General Joshua H. Stein, by Assistant Attorney
General Alvin W. Keller, Jr. and Assistant Attorney General
James Aldean Webster, III, for plaintiff-appellant.
Wiggins Cleveland & McLean PLLC, by Richard M. Wiggins,
North Carolina Department of Transportation ("DOT")
appeals from the trial court's order granting defendant
Laxmi Hotels of Spring Lake's ("Laxmi") 60(b)
motion to set aside the parties' Consent Judgment. After
careful review, we affirm.
owns real property abutting South Main Street in Spring Lake,
upon which it operates a Super 8 Motel franchise ("the
Hotel"). DOT intended to acquire a portion of the
Hotel's property in order to widen and improve South Main
Street. On 8 February 2012, DOT right of way agent Greg Kolat
met with Laxmi's president Dev Rajababoo and informed him
that DOT would be exercising its power of eminent domain to
take a portion of the Hotel's property in order to
execute DOT's South Main Street project. Kolat informed
Rajababoo that DOT was going to acquire a small portion of
the property fronting South Main Street in addition to taking
a permanent utility easement along the frontage of the
property. According to Kolat's testimony and the DOT
Negotiating Diary admitted into evidence, Kolat explained the
DOT "acquisition procedure and why it is fair" to
maintains that Kolat informed Rajababoo that DOT would also
build a retaining wall to run adjacent to South Main Street
along the Hotel property; Rajababoo testified that no one
from DOT told him about the retaining wall. The appraisal
that DOT provided to Rajababoo showed a retaining wall along
the property's frontage, but did not indicate the height
of the prospective wall. Rajababoo also testified that DOT
assured him that the Hotel would not lose any parking spaces
as a result of the taking, and the appraisal did not indicate
a loss of parking spaces.
on these plans, DOT's initial appraisal reflected a $25,
700 "offer of just compensation" for the taking. On
6 June 2012, Laxmi made a counteroffer of $35, 000. DOT
accepted Laxmi's counteroffer; however, Laxmi was unable
to obtain the consent of one of its lenders, so the parties
did not complete the settlement at that time.
point after accepting Laxmi's counteroffer, DOT made
various changes to its South Main Street project plans. These
changes were reflected in a modified appraisal summary. The
modified appraisal indicated that the right of way would be
enlarged, and added a temporary construction easement and a
slope easement. DOT provided Laxmi with a copy of the revised
offer and appraisal summary, but Laxmi maintains that it was
never orally informed by DOT of the change in construction
plans. The revised appraisal reflected a settlement offer to
Laxmi of $35, 000 as just compensation for the taking, which
Laxmi accepted. According to Laxmi, it believed that the
increase of DOT's offer to $35, 000 was in response to
Laxmi's counteroffer rather than in response to an
increase in the scope of the taking. On 23 July 2014, the
parties entered into a Consent Judgment in which the parties
agreed to settle for $35, 000 as just compensation for the
taking. DOT prepared the Consent Judgment.
contends that it did not realize that DOT had changed its
project plans until after construction began. The DOT project
eliminated several of Laxmi's parking spaces, which
caused the Hotel's parking lot to be in violation of
local codes. In addition, when the Department completed
construction of the retaining wall, the wall was roughly
fifteen feet tall, completely blocking the Hotel's
visibility from the street. The Hotel, which prior to the
taking was fully visible from the main thoroughfares in the
area, was, according to Rajababoo, now in a
"dungeon." The pictures taken after the
construction show the Hotel to be invisible from the main
roadways because of the retaining wall.
maintains that it informed Laxmi of the plan changes by
providing Laxmi with copies of the modified appraisal and
increased settlement offer. In support of this contention,
DOT points to the Consent Judgment, which incorporated by
reference the revised project plans. However, the Consent
Judgment "states there is a slope easement under a
heading entitled 'TEMPORARY CONSTRUCTION EASEMENT, '
but does not mention the height of the retaining wall or the
loss of parking spaces."
contrast, Rajababoo testified that he was never informed of
the changes to the plans regarding the loss of parking spaces
or the increased height of the retaining wall. At trial, no
one from DOT testified that he or she told Laxmi or Rajababoo
that DOT's plans had changed. While the documents that
DOT provided to Laxmi mentioned a "retaining wall,
" no document, including the modified appraisal summary,
referenced a loss of parking spaces. Moreover, while the
retaining wall was mentioned, none of the documents indicated
how tall that wall would be.
testified that he first discovered that the Hotel was going
to lose parking spaces "[w]hen they were already gone. .
. . They just started the work. And one fine day I come to
work and all the land is bulldozed, and there's-they are
putting in dirt to make a ramp to come in. . . . Nobody had
ever approached me for that." Laxmi maintains that
"the construction of the wall in front of [the] hotel
has severely impacted the value of the hotel . . . and that
the taking of the additional parking space from the available
usable parking spaces has also severely impacted the value of
the hotel." When asked whether Laxmi would have entered
into the Consent Judgment if it had been told about the wall
or the loss of parking spaces, Rajababoo responded,
"Absolutely no way."
February 2017, Laxmi filed a motion to set aside the Consent
Judgment pursuant to Rule 60(b) of the North Carolina Rules
of Civil Procedure. Laxmi's motion alleged that in
persuading Laxmi to enter into the Consent Judgment, DOT
misrepresented (1) the nature and extent of Laxmi's
property that DOT intended to take, and (2) the effect that
the taking would ultimately have on "the ability of
[Laxmi] to operate or work on the site after the
hearing on Laxmi's motion was conducted before the
Honorable Mary Ann Tally in Cumberland County Superior Court.
Judge Tally determined that Laxmi "reasonably relied
upon the representations made by [DOT]" and that Laxmi
"was never informed of the loss of parking spaces or the
change in the height of the retaining wall placed in front of
the Hotel." Based on these facts, Judge Tally concluded
that DOT "did not adequately inform [Laxmi] of the
extent of the taking of the Hotel property, and did not
provide just compensation to the Hotel." Judge Tally
concluded that these facts warranted the setting aside of the
Consent Judgment pursuant to Rule 60(b)(6) of the North
Carolina Rules of Civil Procedure. Accordingly, Judge Tally
granted Laxmi's motion and ordered that the case proceed
to trial in order to determine the appropriate amount of
compensation for the taking. DOT timely appealed.
appeal, DOT argues that the trial court erred in setting
aside the Consent Judgment (1) because Laxmi's motion was
not timely, and (2) because there was no substantive basis to
justify overturning the judgment.
Grounds for Appellate Review
initially consider whether this Court has jurisdiction to
review the trial court's order granting Laxmi's Rule
maintains that this Court has jurisdiction over the trial
court's order setting aside the Consent Judgment because
the trial court's order "affects a final
judgment" pursuant to N.C. Gen. Stat. §
7A-27(b)(1). However, even if we deem DOT's appeal to be
interlocutory, DOT asserts that the trial court's order
is immediately appealable because it affects a substantial
right. Finally, in the event that this Court determines that
the trial court's order does not affect a substantial
right, DOT has filed a petition for writ of certiorari asking
this Court to assert jurisdiction and address the merits of
Court customarily entertains appeals only from final
judgments. See N.C. Gen. Stat. § 7A-27(b)
(2017). A judgment is final if it "leaves nothing
further to be done in the trial court." Campbell v.
Campbell, 237 N.C.App. 1, 3, 764 S.E.2d 630, 632 (2014)
(citing Steele v. Hauling Co., 260 N.C. 486, 491,
133 S.E.2d 197, 201 (1963)). In contrast, "[a]n order is
interlocutory 'if it does not determine the issues but
directs some further proceeding preliminary to final
decree.' " Waters v. Qualified Personnel,
Inc., 294 N.C. 200, 207, 240 S.E.2d 338, 343 (1978)
(quoting Greene v. Laboratories, Inc., 254 N.C. 680,
693, 120 S.E.2d 82, 91 (1961)). Because an interlocutory
order is not yet final, with few exceptions, "no appeal
lies to an appellate court from an interlocutory order or
ruling of the trial judge[.]" Consumers Power v.
Power Co., 285 N.C. 434, 437, 206 S.E.2d 178, 181
first argues that even though the order setting aside the
parties' Consent Judgment was interlocutory, this Court
nevertheless "has jurisdiction to review the trial
court's order because it set aside a final
judgment." This argument is not persuasive. Judge
Tally's order set aside the Consent Judgment in order for
the parties "to put on evidence at trial . . . to
determine the amount of damages to which [Laxmi] is entitled
pursuant to the General Statutes of North Carolina."
Clearly, as it contemplates further proceedings at the trial
level on the issue of just compensation-the crux of the
Consent Judgment-Judge Tally's order is interlocutory.
See Campbell, 237 N.C.App. at 3, 764 S.E.2d at 632.
notwithstanding its lack of finality, an interlocutory order
may be immediately appealed if "the trial court
certifies, pursuant to N.C. G.S. § 1A-1, Rule 54(b),
that there is no just reason for delay of the appeal, "
Turner v. Hammocks Beach Corp., 363 N.C. 555, 558,
681 S.E.2d 770, 773 (2009) (citation omitted), or if the
"order deprives the appellant of a substantial right
which he would lose if the ruling or order is not reviewed
before final judgment." Consumers Power, 285
N.C. at 437, 206 S.E.2d at 181 (citation omitted); N.C. Gen.
Stat. § 7A-27(b)(3)(a) (2017). "A substantial right
is 'a legal right affecting or involving a matter of
substance as distinguished from matters of form: a right
materially affecting those interests which one is entitled to
have preserved and protected by law: a material right.'
" Gilbert v. N.C. State Bar, 363 N.C. 70, 75,
678 S.E.2d 602, 605 (2009) (quoting Oestreicher v. Am.
Nat'l Stores, Inc., 290 N.C. 118, 130, 225 S.E.2d
797, 805 (1976)). "We consider whether a right is
substantial on a case-by-case basis." Id.
instant case, the trial court did not certify the order
setting aside the Consent Judgment for immediate appellate
review. Nevertheless, DOT argues that "the trial
court's setting aside the consent judgment deprived the
Department of a substantial right, i.e., the benefit
of its bargain in the court-sanctioned settlement of the
case." [PWC p 15] In support of its argument, DOT turns
our attention to Turner v. Hammocks Beach Corp. We
do not find Turner persuasive in the case at bar.
Turner, the defendant had previously "filed a
declaratory judgment action seeking to quiet title" to a
tract of property which was the subject of a charitable
trust. Turner, 363 N.C. at 557, 681 S.E.2d at 773.
The plaintiffs contested the quiet title action and the case
was set for trial. Id. However, "[p]rior to
trial . . ., the parties reached a settlement and signed a
consent judgment, which was entered by the trial
court[.]" Id. Nearly twenty years later, the
plaintiffs brought an action seeking termination of the trust
"alleging that fulfillment of the trust terms has become
impossible or impracticable[.]" Id. The
defendant filed a motion to dismiss the plaintiffs'
action on the grounds that the "plaintiffs' rights
to the property now in question . . . had already been
determined by [a prior] consent judgment and that
relitigation is barred by collateral estoppel."
Id. The trial court denied the defendant's
motion to dismiss, which the defendant argued was immediately
appealable because "the denial of a motion to dismiss a
claim for relief affects a substantial right when the motion
to dismiss makes a colorable assertion that the claim is
barred under the doctrine of collateral estoppel."
Id. at 558, 681 S.E.2d at 773. Our Supreme Court
agreed with the defendant, and explained that "[u]nder
the collateral estoppel doctrine, 'parties and parties in
privity with them are precluded from retrying fully litigated
issues that were decided in any prior determination and were
necessary to the prior determination.' "
Id. (quoting King v. Grindstaff, 284 N.C.
348, 356, 200 S.E.2d ...