YODER v. VERM, 2024 NCBC 60

2024 NCBC 60Ncbizct

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STATE OF NORTH CAROLINA
HENDERSON COUNTY
IN THE GENERAL COURT OF JUSTICE
SUPERIOR COURT DIVISION
23 CVS 1820
DANIEL YODER, M.D.,
Plaintiff,
v.
ALAN VERM, M.D.; LOOKING
GLASS EYE CENTER, P.A.; and
LOOKING GLASS
ENTERPRISES, LLC,
Defendants.
ORDER AND OPINION ON
DEFENDANTS’ RULE 12(c) MOTION
FOR PARTIAL JUDGMENT ON THE
PLEADINGS OR, IN THE
ALTERNATIVE, FOR PARTIAL
SUMMARY JUDGMENT AND ON
PLAINTIFF’S OBJECTIONS
1. 	THIS MATTER is before the Court upon Defendants’ Rule 12(c) Motion for
Partial Judgment on the Pleadings or, in the Alternative, for Partial Summary
Judgment1 (the “Motion”) and Plaintiff’s Objections to Consideration of Affidavit of
Jennifer Houti and Premature Consideration of Alternative Motion for Partial
Summary Judgment2 (the “Objections”; together with the Motion, the “Motions”) in
the above-captioned case.
2. 	Having considered the Motions, the parties’ briefs in support of and in
opposition to the Motions, the relevant pleadings, the arguments of counsel at the
hearing on the Motions, and other appropriate matters of record, the Court hereby
DENIES Defendants’ Motion and DENIES Plaintiff’s Objections as moot as set forth
below.
1 (Defs.’ Rule 12(c) Mot. Partial J. on Pleadings or, the Alt., Partial Summ. J. [hereinafter
“Defs.’ Mot.”], ECF No. 19.)
2 (Pl.’s Objs. Consideration Aff. Jennifer Houti & Premature Consideration Alt. Mot. Partial
Summ. J. [hereinafter “Pl.’s Obj.”], ECF No. 31.)
Yoder v. Verm, 2024 NCBC 60.
Searson, Jones, Gottschalk & Cash, PLLC, by W. Scott Jones, and
Prince, Massagee & Alexander, PLLC, by Sharon B. Alexander,3 for
Plaintiff Daniel Yoder, M.D.
James, McElroy & Diehl, P.A., by Jennifer M. Houti, Adam L. Ross, and
Haley 	M. 	Lohr, 	for 	Defendants 	Alan 	Verm, 	M.D., 	Looking 	Glass
Enterprises, LLC, and Looking Glass Eye Center, P.A.
Bledsoe, Chief Judge.
I.
FACTUAL AND PROCEDURAL BACKGROUND
3. 	The Court does not make findings of fact when ruling on a motion for
judgment on the pleadings under Rule 12(c) of the North Carolina Rules of Civil
Procedure (the “Rule(s)”) and instead recites only those allegations in the pleadings
that are relevant and necessary to the Court’s determination of the motion.
4. 	Plaintiff Daniel Yoder, M.D. (“Dr. Yoder” or “Plaintiff”) and Defendant Alan
Verm, M.D. (“Dr. Verm”) are ophthalmologists who once practiced medicine together
in western North Carolina as sole and equal shareholders of Defendant Looking Glass
Eye Center, P.A. (“LGEC”).4 At one time they were also the sole and equal members
of Defendant Looking Glass Enterprises, LLC (“LGE”), which owns a medical office
building and real property in Hendersonville, North Carolina.5 	LGE holds a 72%
3 On 7 May 2024, after they filed briefs in support of Plaintiff’s Objection and in opposition
to Defendants’ Motion, the Court permitted Alexander and the law firm of Prince, Massagee
and Alexander, PLLC to withdraw as counsel of record for Plaintiff. 	(See Order Pl.’s Mot.
Substitution Counsel, ECF No. 35.)
4 (Verm Defs.’ Answer [“Answer”], Affirmative Defenses, and Countercls. [“Countercls.”],
Countercls. ¶ 8, ECF No. 3.)
5 (Countercls. ¶¶ 9, 10.)
membership interest in Healthcare LLC, VII (“Healthcare VII”), which holds the
ground lease for and owns a medical office building in Brevard, North Carolina, out
of 	which 	LGEC 	operates 	its 	Hendersonville 	medical 	office 	(the 	“Healthcare
Building”).6
5. 	This lawsuit has its origins in the settlement of three mandatory complex
business cases previously before this Court: Looking Glass Eye Center, P.A. v. Daniel
M. Yoder, M.D. (Henderson County Superior Court, Civil Action No. 22-CVS-1141),
Daniel Yoder v. Looking Glass Enterprises, LLC (Henderson County Superior Court,
Civil Action No. 22-CVS-1384), and Daniel Yoder, M.D., individually and derivatively
on behalf of Looking Glass Eye Center, P.A. v. Looking Glass Eye Center, P.A. and
Alan Verm, M.D. (Transylvania County Superior Court, Civil Action No. 22-CVS-332)
(collectively, the “Original Litigation”).
6. 	As in the current action, Dr. Yoder, Dr. Verm, LGEC, and LGE were the
only parties to the Original Litigation, and they memorialized the settlement of the
Original Litigation in a written settlement agreement (the “Settlement Agreement”
or the “Agreement”)7 signed by all parties in late 2022.8 	Because the Transylvania
County action contained derivative claims, the Court also approved the settlement in
6 (Countercls. ¶¶ 11–13.)
7 (Settlement Agreement and Mutual Release [hereinafter “Settlement Agreement”], ECF
No. 2 (redacted), ECF No. 60 (unredacted).)
8 (Settlement Agreement at 12.)
that action on 15 December 2022.9 	After the Settlement Agreement was executed,
the parties dismissed all claims in each action, thereby bringing the Original
Litigation to an end.
7. 	Eleven months later, on 28 November 2023, Dr. Yoder filed the Verified
Complaint initiating the current action, asserting five claims based on his allegation
that Dr. Verm, LGEC, and LGE (collectively, “Defendants”) have “failed and refused
to comply with all of the obligations imposed . . . by the terms of the Settlement
Agreement.”10 More particularly, Dr. Yoder asserts breach of contract claims against
Dr. Verm and LGEC for their alleged failure to pay (i) “Additional Funds,” as defined
in the Settlement Agreement (Count One)11; (ii) interest on a promissory note (Count
Two)12; and (iii) the full agreed-upon buyout amount for Dr. Yoder’s membership
interest in LGE (Count Three).13 	Dr. Yoder also asserts a breach of contract claim
against Dr. Verm and LGE for their alleged failure to pay “36% of the appraised value
of the Healthcare Building and any cash held by Healthcare VII, after subtracting
the amount of outstanding debts of Healthcare VII in existence as of the date of the
Settlement Agreement.”14 	In addition, Dr. Yoder broadly seeks a declaratory
9 (Verified Compl. ¶¶ 8–9, ECF No. 2; Order Approving Proposed Settlement Agreement,
Transylvania County Civil Action No. 22-CVS-332, ECF No. 38.)
10 (Verified Compl. ¶ 16.)
11 (Verified Compl. ¶¶ 18–27.)
12 (Verified Compl. ¶¶ 28–44.)
13 (Verified Compl. ¶¶ 45–63.)
14 (Verified Compl. ¶¶ 64–83.)
judgment “relating to the parties’ respective rights and obligations under the
Settlement Agreement.”15
8. 	Defendants filed their Answer, Affirmative Defenses, and Counterclaims
(the “Counterclaims”) on 17 January 2024,16 and Dr. Yoder filed his Affirmative
Defenses and Reply to the Counterclaims on 14 February 2024.17 	Defendants filed
the current Motion on 18 April 2024,18 and Dr. Yoder filed his Objections on 7 May
2024.19
9. 	After full briefing, the Court held a hearing on the Motions on 10 July 2024
(the “Hearing”), at which all parties were represented by counsel. 	The Motions are
now ripe for resolution.
II.
LEGAL STANDARD
10. 	Rule 12(c) provides that “[a]fter the pleadings are closed but within such
time as not to delay the trial, any party may move for judgment on the pleadings.”
N.C. R. Civ. P. 12(c). Rule 12(c) is intended “to dispose of baseless claims or defenses
when the formal pleadings reveal their lack of merit and is appropriately employed
where all the material allegations of fact are admitted in the pleadings and only
15 (Verified Compl. ¶ 85.)
16 (Answer and Countercls.)
17 (Pl.’s Affirmative Defenses and Reply, ECF No. 6.)
18 (Defs.’ Mot.)
19 (Pl.’s Obj.)
questions of law remain.” DiCesare v. Charlotte-Mecklenburg Hosp. Auth., 375 N.C.
63, 70 (2020) (quoting Ragsdale v. Kennedy, 286 N.C. 130, 137 (1974)).
11. 	In considering a motion for judgment on the pleadings:
all well pleaded factual allegations in the nonmoving party’s pleadings
are taken as true and all contravening assertions in the movant’s
pleadings are taken as false. As with a motion to dismiss, the trial court
is required to view the facts and permissible inferences in the light more
favorable to the nonmoving party. A Rule 12(c) movant must show that
the complaint fails to allege facts sufficient to state a cause of action or
admits facts which constitute a complete legal bar to a cause of action.
Tully v. City of Wilmington, 370 N.C. 527, 532 (2018) (cleaned up).
12. 	Under Rule 12(c), the trial court may consider “[a]n exhibit, attached to
and made a part of the [complaint],” Wilson v. Crab Orchard Dev. Co., 276 N.C. 198,
206 (1970), and documents that are “the subject of the action and specifically
referenced in the complaint,” Erie Ins. Exch. v. Builders Mut. Ins. Co., 227 N.C. App.
238, 242 (2013). 	Where a document is attached to a pleading, “[t]he terms of such
exhibit control other allegations of the pleading attempting to paraphrase or construe
the exhibit, insofar as these are inconsistent with its terms.” 	Wilson, 276 N.C. at
206.20
13. 	“The party moving for judgment on the pleadings must show that no
material issue of fact exists and that he is entitled to judgment as a matter of law.”
Daniels v. Montgomery Mut. Ins. Co., 320 N.C. 669, 682 (1987). Moreover, a “motion
under Rule 12(c) must be carefully scrutinized lest the nonmoving party be precluded
20 A redacted version of the Settlement Agreement was attached to Plaintiff’s Verified
Complaint. (See ECF No. 2.) At the Court’s direction, Dr. Verm filed an unredacted version
of the Settlement Agreement on the Court’s docket on 9 September 2024. (See ECF No. 60.)
from a full and fair hearing on the merits.” 	Newman v. Stepp, 376 N.C. 300, 305
(2020) (citation and internal quotation marks omitted).
III.
ANALYSIS
14. 	Defendants have substantially narrowed the matters at issue on the Motion
since its filing. 	Although they originally sought “judgment on Plaintiff’s claim for
declaratory judgment and [Defendants’] counterclaim for declaratory judgment with
respect to the declarations identified in [Defendants’] prayer for relief at Paragraph
2(c), (d), (e), and (f),” Defendants orally withdrew this aspect of their Motion at the
Hearing under both Rules 12(c) and 56. 	Thereafter, Defendants filed a Notice of
Partial 	Withdrawal 	of 	Motion 	(the 	“Withdrawal 	Notice”) 	to 	formalize 	the
withdrawal.21
15. 	Defendants also withdrew at the Hearing and through the Withdrawal
Notice their alternative motion for summary judgment under Rule 56 to the extent
Defendants sought (i) dismissal of “Count Four (Breach of Contract Against Verm
and 	LGE, 	LLC) 	of 	Plaintiff’s 	Complaint” 	and 	(ii) 	judgment 	on 	Defendants’
“counterclaim for declaratory judgment as stated in Paragraph 2(h) of [Defendants’]
prayer for relief, which seeks a declaration that: Pursuant to the Settlement
Agreement, 	upon 	the 	sale 	of 	the 	[Healthcare 	Building,] 	Yoder 	is 	entitled 	to
21 (Not. Partial Withdrawal Mot., ECF No. 58.)
disbursement of 36% of the net proceeds from the sale plus 36% of the net cash held
by Healthcare LLC, VII at that time, and nothing more.”22
16. 	As a result, the only issues that remain for determination are Defendants’
Motion under Rule 12(c) to (i) dismiss Count Four of Plaintiff’s Complaint and (ii)
enter judgment for Defendants on their counterclaim as stated in Paragraph 2(h) of
Defendants’ Prayer for Relief. 	These claims essentially mirror one another and
reflect the parties’ competing interpretations of section 2.H.c of the Settlement
Agreement. 	Dr. Yoder alleges in Count Four of his Verified Complaint that, under
section 2.H.c, he is “entitled to 36% of the appraised value of the Healthcare Building
and any cash held by Healthcare VII, after subtracting the amount of any outstanding
debts of Healthcare VII in existence as of the date of the Settlement Agreement.”23
In contrast, and as noted above, Defendants argue section 2.H.c provides that “upon
the sale of the [Healthcare Building], [Dr.] Yoder is entitled to disbursement of 36%
of the net proceeds from the sale plus 36% of the net cash held by Healthcare LLC, VII
at that time, and nothing more.”24
17. 	Section 2.H.c. provides, in relevant part, as follows:
c. Purchase of Yoder’s Interest in Healthcare VII
Upon receipt of the appraisals of the Healthcare Building, Verm shall
act promptly and work in good faith and in a commercially reasonable
22 As a result of the Withdrawal Notice, Defendants have withdrawn their alternative motion
under Rule 56 in its entirety. Therefore, Plaintiff’s Objections to the Court’s consideration of
that alternative motion shall be denied as moot.
23 (Verified Compl. ¶ 79 (emphasis added).)
24 (Countercls. Prayer for Relief ¶ 2(h) (emphasis added).)
manner to effectuate his purchase of Yoder’s membership interest in
Healthcare VII. 	More specifically, Verm shall work in good faith with
ACN to permit Verm to purchase Yoder’s membership interest in
Healthcare VII for 36% of the appraised fair market value of the
Healthcare Building and any cash held by that entity, after subtracting
the amount of any outstanding debts of that entity in existence as of the
dates of this Agreement, i.e., the Healthcare VII Buyout. Upon Yoder’s
receipt of such payment, Yoder’s membership interest in Healthcare VII
shall be considered sold and transferred in full to Verm, and Yoder shall
be deemed to have resigned from any and all positions or affiliations
with Healthcare VII, including, but not limited to, as a member, officer,
director, manager, or agent.
***
Notwithstanding the foregoing, in the event that, during the thirty days
following the Settlement Date, the Parties confirm that ACN intends to
market and sell the Healthcare Building, Verm shall instead promptly
work in a good faith and commercially reasonable matter [sic] with ACN
to cause Healthcare VII to market and to sell the Healthcare Building
in a commercially reasonable manner, and upon consummation of the
sale, Yoder shall be paid net proceeds, plus any cash held by that entity
at the time of the closing of the sale of the Healthcare Building,
commensurate with his 36% membership interest in Healthcare VII.25
18. 	Defendants argue that, on the pleaded facts, the second-quoted paragraph
above applies. 	Defendants acknowledge that “33 days after the Settlement Date, a
lawyer for [ACN] confirmed in writing that [ACN] did wish to proceed with marketing
and 	selling 	the 	[Healthcare 	Building]”—thus 	implicitly 	conceding 	that 	ACN’s
confirmation of its intent to market and sell did not come within thirty days after the
Settlement Date. 	Even so, they argue that, under North Carolina law, “[ACN’s]
desire to market and sell the [Healthcare Building] simply had to occur within a
reasonable time after 30 days from the Settlement Date.”26 Asserting that where, as
25 (Settlement Agreement, at sec. 2.H.c.)
26 (Verm Defs. Br. Supp. Rule 12(c) Mot. 12 [hereinafter “Br. Supp. Defs. Mot.”], ECF No. 20.)
here, the Settlement Agreement does not contain a “time is of the essence” clause,
Defendants contend that “North Carolina law implies that performance must be
completed within a reasonable time” and that the timing of ACN’s performance three
days after the expiration of the 30-day confirmation period was reasonable.27 	As
such, Defendants argue that the second-quoted paragraph in section 2.H.c. applies,
Dr. Yoder’s claim and defense based on the applicability of the first-quoted paragraph
are 	therefore 	without 	merit, 	and 	thus 	that 	judgment 	should 	be 	entered 	for
Defendants under Rule 12(c).28
19. 	The Court finds Defendants’ argument without merit. Indeed, Defendants
fundamentally misapprehend North Carolina’s “reasonable time to perform” rule.
Our courts have long made clear that the “the reasonable time to perform” rule
applies only to contracts for the purchase and sale of real property, rather than in all
contexts, as Defendants appear to contend. As our Court of Appeals has summarized:
As a general rule, the language of a contract should be interpreted as
written; however, there is a well-settled exception, the “reasonable time
to perform rule,” that applies to contracts for the sale of real property.
With respect to these realty sale contracts, it has long been held that in
the absence of a “time is of the essence” provision, time is not of the
essence, the dates stated in an offer to purchase and contract agreement
serve only as guidelines, and such dates are not binding on the parties.
Harris v. Stewart, 193 N.C. App. 142, 146 (2008). See, e.g., Kassel v. Rienth, 289 N.C.
App. 173, 183 (2023) (recently applying Harris).
27 (Br. Supp. Defs. Mot. 11–12.)
28 (Br. Supp. Defs. Mot. 10–16.)
20. 	It is undisputed that the Settlement Agreement is concerned with Dr.
Verm’s purchase of Dr. Yoder’s interests in LGEC, LGE, and Healthcare VII and that
section 2.H.c., in particular, concerns Dr. Verm’s purchase of Dr. Yoder’s interest in
Healthcare VII. While section 2.H.c. contemplates that the Healthcare Building may
be sold to a third party, neither that section nor the Settlement Agreement more
broadly creates a contract for the purchase and sale of real property. 	As such, the
“reasonable time to perform rule” has no application to section 2.H.c., and instead
that section’s language must be interpreted as written.29
21. 	Based 	on 	its 	careful 	review 	of 	the 	Settlement 	Agreement, 	the 	Court
concludes that section 2.H.c. unambiguously provides that, unless the parties confirm
that ACN intends to market and sell the Healthcare Building within thirty days
following the Settlement Date, the procedure outlined in the first paragraph of section
2.H.c. shall control. Here, Dr. Yoder has alleged that “during the thirty days following
the Settlement Date, the Parties did NOT confirm to Yoder that ACN intends to
market and sell the Healthcare Building.”30 	Assuming the truth of this allegation,
Dr. Yoder has successfully pleaded facts that require Dr. Verm to purchase his
interest in Healthcare VII based on 36% of the appraised fair market value of the
Healthcare Building as set forth in the first-quoted paragraph in section 2.H.c.
29 North Carolina’s other “reasonable time” rule—that “if no time for the performance of an
obligation is agreed upon by the parties, then the law prescribes that the act must be
performed within a reasonable time,” Metals Corp. v. Weinstein, 236 N.C. 558, 561 (1952)
(cleaned up)—does not apply here either because section 2.H.c. expressly supplies a thirty-
day time period for the parties’ performance.
30 (Verified Compl. ¶ 77 (emphasis in original).)
Although Defendants denied Dr. Yoder’s allegation that confirmation of ACN’s intent
did not occur within the required 30-day period,31 that denial does not support their
motion under Rule 12(c), which requires that the pleadings contain undisputed facts
on which judgment may be entered as a matter of law for the moving party. See, e.g.,
Shehan v. Gaston County, 190 N.C. App. 803, 806 (2008) (“Judgment on the pleadings,
pursuant to Rule 12(c), is appropriate when all the material allegations of fact are
admitted in the pleadings and only questions of law remain.”). 	Based on the
foregoing, the Court concludes that Defendants’ Motion must be denied.
IV.
CONCLUSION
22. 	WHEREFORE, 	based 	on 	the 	foregoing, 	the 	Court 	hereby 	DENIES
Defendants’ Motion and DENIES Plaintiff’s Objections as moot.
SO ORDERED, this the 10th day of September, 2024.
/s/ Louis A. Bledsoe, III
Louis A. Bledsoe, III
Chief Business Court Judge
31 (See Answer ¶ 77.) The Court notes that Defendants’ Counterclaim does not contain factual
averments suggesting that within thirty days of the Settlement Date, the parties did, in fact,
confirm that ACN intended to market and sell the Healthcare Building. The only reference
to the timing of that confirmation is the 18 January 2023 communication from ACN’s lawyer
the Court discussed above. 	(See Countercls. ¶ 41.) 	Given Defendants’ counterclaim
allegation, and considering that Defendants argued on the Motion that confirmation was not
received until thirty-three days after the Settlement Date, it is unclear to the Court on what
basis Defendants denied, and continue to deny, Dr. Yoder’s allegation at paragraph 77 of his
Complaint.

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