                                   NO. COA13-1089

                       NORTH CAROLINA COURT OF APPEALS

                             Filed: 15 April 2014


DEAVEN GREY DAVIS, DANETTE DAVIS
and DICKIE G. DAVIS,

    Plaintiffs,

    v.                                        Surry County
                                              No. 12 CVS 817
HERMILO SALAZAR URQUIZA,

    Defendant.


    Appeal by plaintiffs from order entered 11 March 2013 by

Judge James M. Webb in Surry County Superior Court.                      Heard in

the Court of Appeals 18 February 2014.


    Daggett, Shuler, Koontz, Nauman & Bell,                       P.L.L.C.,      by
    Michael W. Clark, for plaintiff-appellants.

    Willardson & Lipscomb, LLP, by John S. Willardson, for
    unnamed defendant-appellee, North Carolina Farm Bureau
    Mutual Insurance Company.


    STEELMAN, Judge.


    Where      valid     service    of   process     was   not    made   upon   an

uninsured     motorist    carrier    within    the    applicable     statute     of

limitations period, the trial court did not err in granting the

motion   of    the     uninsured    motorist       carrier   to    dismiss      for

insufficient process or insufficient service of process.
                                         -2-
                     I. Factual and Procedural Background

       On 15 July 2009, Deaven Grey Davis, then a minor, was a

passenger in a vehicle struck by another vehicle operated by

Hermilo Salazar Urquiza (“defendant”).                  On 31 May 2012, Deaven

Davis,     along     with   her    parents,    Danette    and   Dickie    G.    Davis

(collectively,        “plaintiffs”)       filed    suit     against      defendant,

seeking monetary damages for personal injuries resulting from

the collision.

       Defendant was an uninsured motorist.                Plaintiffs contended

that North Carolina Farm Bureau Mutual Insurance Company (“Farm

Bureau”)      provided       uninsured     motorists’       coverage      for      the

collision in accordance with N.C. Gen. Stat. § 20-279.21(b)(3).

Defendant was served with a copy of the summons and complaint on

29 July 2012.          Plaintiffs also contended that National Grange

Insurance      Company       (“National       Grange”)     provided      applicable

uninsured motorists’ coverage.

       On 5 June 2012, counsel for plaintiffs mailed a copy of the

summons and complaint to Steve Wagoner, a claims adjuster for

Farm      Bureau,     by    certified     mail,    at     Wagoner’s      office    in

Wilkesboro.        These documents were received on 7 June 2012.                  On 6

July 2012, Farm Bureau filed an answer to plaintiffs’ complaint,

as   an    unnamed    party,      specifically    asserting     the   defenses      of
                                         -3-
insufficiency       of   process      and      insufficiency    of    service     of

process, as well as the statute of limitations.                   On 27 December

2012, Farm Bureau gave notice to plaintiffs of a hearing on 7

January    2013     concerning     its      motion    to   dismiss    based      upon

insufficiency       of   process      and      insufficiency    of    service      of

process.    On 31 December 2012, Farm Bureau served the affidavit

of H. Julian Philpott, Jr.               This affidavit stated that Steve

Wagoner “was not now, nor has he ever been an officer, director

or managing agent of North Carolina Farm Bureau Mutual Insurance

Company, nor has he ever been a designated process agent for

that company...”

    Plaintiffs caused alias and pluries summonses to be issued

by the Clerk of Superior Court of Surry County, directed to

defendant, on 20 July 2012, 25 September 2012, and 10 December

2012.      On   2   January   2013,      plaintiffs    mailed    a   copy   of    the

summons    and      complaint    to      Wayne    Goodwin,      Commissioner      of

Insurance, by certified mail, in order to serve Farm Bureau in

accordance with the provisions of N.C. Gen. Stat. § 58-16-30.

This was received by the Commissioner of Insurance on 7 January

2013.

    On 7 January 2013, Farm Bureau’s motion to dismiss was

heard before the trial court.             By order filed 11 March 2013, the
                                      -4-
trial   court     granted        defendant’s       motion,   and        dismissed

plaintiffs’     complaint       against     Farm   Bureau    as    an     unnamed

defendant, with prejudice.

    Plaintiffs appeal.

                        II. Standard of Review

    “We review de novo the grant of a motion to dismiss.”                     Lea

v. Grier, 156 N.C. App. 503, 507, 577 S.E.2d 411, 414 (2003).

Where there is no valid service of process, the court lacks

jurisdiction over a defendant, and a motion to dismiss pursuant

to Rule 12(b) should be granted.            Sink v. Easter, 284 N.C. 555,

561, 202 S.E.2d 138, 143 (1974).

                       III. Service of Process

    In their sole argument on appeal, plaintiffs contend that

the trial court erred in dismissing the complaint against Farm

Bureau for insufficient process and/or insufficient service of

process.   We disagree.

    N.C.   Gen.    Stat.    §    20-279.21(b)(3),      concerning       uninsured

motorist coverage, provides that:

           [T]he insurer shall be bound by a final
           judgment taken by the insured against an
           uninsured motorist if the insurer has been
           served with copy of summons, complaint or
           other process in the action against the
           uninsured   motorist   by    registered   or
           certified mail, return receipt requested, or
           in any manner provided by law . . . The
                                       -5-
               insurer,   upon   being    served   as   herein
               provided, shall be a party to the action
               between   the   insured   and   the   uninsured
               motorist though not named in the caption of
               the pleadings and may defend the suit in the
               name of the uninsured motorist or in its own
               name. The insurer, upon being served with
               copy   of   summons,    complaint    or   other
               pleading, shall have the time allowed by
               statute in which to answer, demur or
               otherwise plead (whether the pleading is
               verified or not) to the summons, complaint
               or other process served upon it. . . . The
               failure to post notice to the insurer 60
               days in advance of the initiation of suit
               shall not be grounds for dismissal of the
               action, but shall automatically extend the
               time for the filing of an answer or other
               pleadings to 60 days after the time of
               service of the summons, complaint, or other
               process on the insurer.

N.C.    Gen.    Stat.   §    20-279.21(b)(3)(a)    (2013).    This   statute

provides that, in order for an uninsured motorist carrier to be

bound by a proceeding, mere notice is insufficient; the carrier

must be formally served with process.             See Liberty Mut. Ins. Co.

v. Pennington, 356 N.C. 571, 576, 573 S.E.2d 118, 122 (2002)

(holding that the statute “unequivocally requires that the UM

carrier be served with a copy of the summons and complaint in

order    to     be   bound    by   a   judgment    against   the   uninsured

motorist.”).
                                  -6-
    Under Rule 4(j)(6) of the North Carolina Rules of Civil

Procedure,     service   of   process     can   be   effected   upon   a

corporation:

         a.   By delivering a copy of the summons and
         of the complaint to an officer, director, or
         managing agent of the corporation or by
         leaving copies thereof in the office of such
         officer, director, or managing agent with
         the person who is apparently in charge of
         the office.

         b.   By delivering a copy of the summons and
         of the complaint to an agent authorized by
         appointment or by law to be served or to
         accept service of process or by serving
         process upon such agent or the party in a
         manner specified by any statute.

         c.   By mailing a copy of the summons and of
         the complaint, registered or certified mail,
         return receipt requested, addressed to the
         officer, director or agent to be served as
         specified in paragraphs a and b.

         d.   By   depositing   with   a   designated
         delivery service authorized pursuant to 26
         U.S.C. § 7502(f)(2) a copy of the summons
         and complaint, addressed to the officer,
         director, or agent to be served as specified
         in paragraphs a. and b., delivering to the
         addressee, and obtaining a delivery receipt.
         As used in this sub-subdivision, “delivery
         receipt” includes an electronic or facsimile
         receipt.

N.C. R. Civ. P. 4(j)(6) (2013).         In addition, N.C. Gen. Stat. §

58-16-30 provides that an insurance company can be served by
                                       -7-
serving the North Carolina Commissioner of Insurance.                  N.C. Gen.

Stat. § 58-16-30 (2013).

      We have previously held that statutes concerning service of

process must be strictly complied with, and that even actual

notice, if it does not comply with statutory requirements, does

not give the court jurisdiction over a party.               Fulton v. Mickle,

134 N.C. App. 620, 623-24, 518 S.E.2d 518, 520-21 (1999).                      In

Fulton, we held that service upon a party was defective for two

reasons: first, because it was delivered by regular mail instead

of certified mail; second, because the recipient was not one of

those listed in Rule 4(j)(6) as authorized to receive service.

We   hold    that   this   latter    basis,    the   lack   of    an   authorized

recipient, is controlling in the instant case.

      “[A]    defendant    who   seeks    to    rebut   the      presumption   of

regular service generally must present evidence that service of

process failed to accomplish its goal of providing defendant

with notice of the suit.            However, once the defendant has pled

the statute of limitations, the burden is on the plaintiff to

show that his cause of action accrued within the limitations

period.” Lawrence v. Sullivan, 192 N.C. App. 608, 621-22, 666

S.E.2d 175, 182-83 (2008) (citations and quotations omitted).

In Lawrence, the plaintiff, seeking to bring an action against
                                             -8-
Sullivan,      served      process       within     the   applicable       limitations

period by certified mail.                 The letter was signed for by one

James Holt.        The plaintiff voluntarily dismissed the case, and

then    refiled      it    within    one     year.        The    defendant,       in    her

affidavit, stated that she did not reside at the residence where

the certified letter was delivered or receive a copy of the

summons and complaint.          The trial court held that the defendant

had     rebutted     the    presumption        of    valid      service    within       the

limitations period, placing the burden upon the plaintiff to

prove that the action accrued within the limitations period.

The trial court held that the plaintiff failed to do so, and

that defendant was entitled to a dismissal due to insufficient

process or service of process within the applicable limitations

period.     We affirmed.       Id. at 623, 666 S.E.2d at 183.

       In   the    instant    case,       plaintiffs      mailed    a     copy    of    the

summons and complaint to Steve Wagoner, a claims adjuster for

Farm Bureau, by certified mail on 5 June 2012.                             Plaintiffs’

complaint alleged that the accident took place on 15 July 2009.

The applicable statute of limitations for personal injury in

tort,    and   for    service       on   a   UM     carrier,    arising     out    of   an

automobile accident is three years.                   N.C. Gen. Stat. § 1-52(16)

(2013); Thomas v. Washington, 136 N.C. App. 750, 754, 525 S.E.2d
                                     -9-
839, 842 (2000) (holding that “the three-year tort statute of

limitations, which begins running on the date of an accident,

also applies to the uninsured motorist carrier.”).

    The    affidavit    of    H.   Julian   Philpott,    Jr.,    states   that

Wagoner was neither an officer nor director, nor a designated

agent for service of process, for Farm Bureau.                 This affidavit

rebutted     the    presumption     that    service     upon    Wagoner    was

effective.     Plaintiff failed to present evidence to demonstrate

effective service within the limitations period.                We therefore

hold that plaintiffs’ purported service of process upon Steve

Wagoner was defective.

    Plaintiffs contend that this case presents us with “a new

set of facts with no case law directly on point.”                    This is

simply not correct.          Our opinion in Thomas v. Washington is

controlling.       In Thomas, the plaintiff had uninsured motorist

coverage, and was in an accident on 31 March 1995; “the three-

year statute of limitations applicable to automobile negligence

actions ran on 31 March 1998.”         Thomas, 136 N.C. App. at 751-53,

525 S.E.2d at 841.1       The plaintiff instituted an action within



1
  We are puzzled as to why appellee does not directly cite to
Thomas v. Washington in its brief.     Rather, its argument is
based upon a recommended decision of a federal magistrate in
Neth. Ins. Co. v. Cockman, 342 F. Supp. 2d 396 (M.D.N.C. 2004),
which references Thomas v. Washington.     Appellee cites this
                                        -10-
the   limitations      period,    and    properly       served     the   individual

defendants;    however,     the   uninsured          motorist    carrier    was   not

served    within     the   applicable     three-year       period.         Plaintiff

contended     that     service     upon        the     insurance     company      was

nonetheless effective, despite being served upon the company’s

registered agent after the expiration of the limitations period.

Plaintiff’s contention was that the limitations period was based

on contract, not on tort, and that the action was kept alive

through alias or pluries summonses.                  Id. at 753-54, 525 S.E.2d

at 842.     We disagreed, holding that the three-year tort statute

of limitations applied, and that alias or pluries summonses only

extend the action upon defendants who are not served, until such

time as service can be made.            Id. at 753-55, 525 S.E.2d 842-43.

We further held that:

            Our appellate courts have required strict
            compliance with the statutes which provide
            for   service  of   process   on   insurance
            companies   in   similar   situations.   For


decision as if it was authoritative. It is not. With regard to
matters of North Carolina state law, “neither this Court nor our
Supreme Court is ‘bound by the decisions of federal courts,
including the Supreme Court of the United States, although in
our discretion we may conclude that the reasoning of such
decisions is persuasive.’” Libertarian Party of N.C. v. State,
200 N.C. App. 323, 331, 688 S.E.2d 700, 706 (2009) aff'd as
modified, 365 N.C. 41, 707 S.E.2d 199 (2011) (quoting State ex
rel. Martin v. Preston, 325 N.C. 438, 449–50, 385 S.E.2d 473,
479 (1989)).   Briefs should cite directly to controlling North
Carolina precedent.
                                      -11-
            example, in Fulton v. Mickle this Court held
            that mailing a copy of the summons and
            complaint by regular mail to a claims
            examiner for the insurer did not comply with
            the requirement of Rule 4(j)(6)(c) of the
            Rules of Civil Procedure that a copy of the
            summons   and    complaint    be    mailed   by
            “registered   or    certified    mail,   return
            receipt requested, addressed to the officer,
            director or agent to be served....”

Id. at 755, 525 S.E.2d at 843.

    Where    a   plaintiff        seeks    to    bind   an    uninsured      motorist

carrier to the result in a case, the carrier must be served by

the traditional means of service, within the limitations period.

In the instant case, plaintiffs’ service upon a claims adjuster

was insufficient.        As we held in Thomas, plaintiffs’ alias and

pluries   summonses      issued    after    defendant        was   served    have    no

legal effect.       Id. at 755, 525 S.E.2d at 843.                      Plaintiffs’

service   upon     the   Commissioner       of    Insurance        outside    of    the

limitations period mandated dismissal.

    The    trial    court   did     not    err    in    granting     Farm    Bureau’s

motion to dismiss for insufficiency of process or insufficiency

of service of process.

    This argument is without merit.

    AFFIRMED.

    Judges McGEE and ERVIN concur.
