Terminated contractor refuses to refund advance: Conversion: Unfair trade practices: Settlement

Law Reporter, Oct 2002

Earle ro. First Choice Servs., Inc., N.C., Guilford County Super. Ct., No. 01-CVS-3576, Apr. 1, 2002.

Earle, a builder, attempted to restore his home after it was damaged in a fire. He hired First Choice, a contractor, to perform part of the repair work. First Choice promised to involve Earle in major decisions concerning the rebuilding. Earle endorsed a check for $75,000 from his insurance company over to First Choice as a cash advance for the initial costs of structural repairs. The contractor then allegedly began plans to demolish Earle's office and master suite, failed to advise Earle of important meetings concerning the restoration, and did not solicit his opinion on how the structural repairs would be done.

Earle terminated his agreement with First Choice and demanded return of the advance. The contractor offered to return $25,000, saying that preparatory work and lost business opportunities had cost the company $50,000.

Earle sued First Choice under the state's unfair business practices law, N.C. Gen. Stat. 75-1.1, alleging conversion and unfair trade practices. He alleged that defendant had breached the agreement to involve him in a supervisory capacity and represented to others that it had authority to proceed with the restoration work.

Defendant counterclaimed for breach of contract and lost business opportunities.

Discovery revealed that defendant had no general contractor's license, although the individual who owned the business did. Plaintiff moved for partial summary judgment on its conversion claim based on this information, and the court entered partial summary judgment for $75,000. While plaintiffs motion for summary judgment on its unfair trade practices claim was pending, the parties settled for about $109,000.

Plaintiffs Counsel

*David M. Clark, Greensboro, N.C. *Jonathan Wall, Greensboro, N.C.

Documents in this case are available through the Court Document Sets section in the back of this issue, courtesy of Mr. Wall.