N.C. Business Court Opinions, December 21, 2022 – January 3, 2023

Brown v. Onslow Bay Marine Grp., LLC, 2022 NCBC 84 (N.C. Super. Ct. Dec. 22, 2022) (Robinson, J.)

Key Terms: summary judgment; attorneys’ fees; notice; N.C.G.S. 6-21.2(5); promissory note; royalties

This action arose out of a dispute over three loans made by Plaintiff Brown to Defendant OBMG, evidenced by promissory notes in the amounts of $50,000.00, $100,000.00, and $300,000.00, each with substantially similar terms. Brown sued for breach of each note and sought to recover sums due and owing and attorneys’ fees. OBMG moved for summary judgment on all claims.

Regarding the $50,000.00 and $100,000.00 promissory notes, the Court concluded that there was no material dispute that the principal and interest had been repaid in full and granted OBMG summary judgment thereon. However, the Court found that a factual dispute remained related to the payment of royalties under both the $50,000.00 and $100,000.00 promissory notes and denied OBMG’s summary judgment motion related thereto. As to the $300,000 note, the Court denied summary judgment because the parties disputed whether or not there has been a default under the $300,000 note, an oral modification thereof, and the amount and payment of royalties due thereunder.

The Court granted OBMG summary judgment as to the claims for attorneys’ fees finding that Brown had failed to comply with the notice requirements of N.C.G.S. 6-21.2(5) because in his demands related to the $50,000.00 and $100,000.00 promissory notes he stated that the amount due under the notes was “to be determined” which the Court found insufficient and Plaintiff stated that the outstanding amount must be “made” not “paid” and therefore did not adequately notify OBMG that payment was required to avoid liability for attorneys’ fees. The notice in the $300,000.00 note was also found insufficient for using the word “made” instead of “paid.”


By Rachel E. Brinson


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Posted 01/04/23 in Business Court Blast, Legal Updates