Consumer Protection – Debt Collection – Legal Proceeding – Contract – Promissory Note & Mortgage – Modification – Civil Practice – Statute of Limitations – Pleadings Amendment

Crabtree v. Smith (Lawyers Weekly No. 012-064-17, 14 pp.) (Ann Marie Calabria, J.) Appealed from Wake County Superior Court (Orlando Hudson Jr., J.) N.C. App. Unpub.

Holding: Plaintiffs assert that the defendant-bank violated G.S. § 75-54(4) by making false representations in its dealings with plaintiffs; however, § 75-54(4) concerns false representations made “in any legal proceeding.” Because the complaint failed to allege that any misrepresentations were made “in any legal proceeding,” plaintiffs failed to state a claim under § 75-54(4).

We affirm the trial court’s grant of defendants’ motions to dismiss under R. Civ. P. 12(b)(6).

Plaintiffs also allege the bank violated G.S. § 75-55(2) by “collecting or attempting to collect” late fees. However, the payment itemization accompanying the complaint shows that, on multiple occasions, plaintiffs made their payments after the 16th of the month, which would entitle the bank to late fees. The complaint does not suggest that any late fees, other than those to which the bank would have been entitled for those months, were charged or collected. As such, the complaint fails to allege that defendants charged or collected any fees to which they might not otherwise be entitled.

A breach of contract claim accrues upon the breach and is subject to a three-year statute of limitations. The complaint demonstrates that, as early as June 2011, plaintiffs were aware that their loan modification agreement with the lender had not been implemented. On May 27, 2012, the defendant-bank filed a notice of default and, in September 2012, a foreclosure petition. Plaintiffs’ complaint was filed in November 2015, more than three years after any alleged violation had occurred.

Furthermore, the complaint fails to allege any wrongdoing that fell within the three-year limitations period. As such, even if it applied, the continuing wrong doctrine would not save this claim.

Plaintiffs’ oral expression of willingness to plead additional facts – made at the Rule 12(b)(6) hearing – did not rise to the level of a motion to amend their complaint. Plaintiffs’ second expression of a desire to amend the complaint came after the trial court had ruled on the motions to dismiss. Once the trial court entered its dismissal under Rule 12(b)(6), plaintiffs’ right to amend under N.C. R. Civ. P. 15(a) was terminated. The trial court did not abuse its discretion in denying plaintiffs’ motion to amend.

Affirmed.