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An  unpublished  opinion  of  the  North  Carolina  Court  of  Appeals  does  not  constitute
controlling legal  authority. Citation is disfavored, but may be permitted in accordance
with the provisions of Rule  30(e)(3) of the  North Carolina Rules of Appellate Procedure.
NO. COA11-1158
NORTH CAROLINA COURT OF APPEALS
Filed:  3 April  2012
CAROL S. MACMILLAN
Plaintiff,
v.                                                                                              Forsyth County
No.  85 CVD  351
JERROLD H. MACMILLAN,
Defendant.
Appeal  by  plaintiff  from  order  entered  7  July  2011  by  Judge
Chester  Davis  in  Forsyth  County  District  Court.     Heard  in  the
Court of Appeals  8 February  2012.
William  W.  Walker  of  Craige,  Brawley,  Lipfert  &  Walker,
LLP, attorney for plaintiff.
No brief filed by defendant.
ELMORE, Judge.
Carol   S.   MacMillan                                                                          (plaintiff)   appeals   from   an   order
                                                                                                dismissing  her  motion  in  the  cause  for  failure  to  state  a  claim
                                                                                                upon  which  relief  can  be  granted.    After  careful  consideration,
we reverse.
In                                                                                              1955  plaintiff  married  Jerrold  MacMillan,  and  in                       1985
the   couple   divorced   in   Massachusetts.                                                                                                                                Around   this   time,




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plaintiff  and  Jerrold  executed  a  separation  agreement  which
provided  in  part  that                                                      “[Jerrold]  agrees  that  his  last  will  and
testament,   or   other   instrument   will   provide   Twenty-Thousand
Dollars  ($20,000.00)  for  [plaintiff]  on  the  death  of  [Jerrold.]”
In   January                                                                  1985,   Jerrold   was   living   in   Winston-Salem,   so
plaintiff  sought  to  have  the  separation  agreement  registered  in
this  state.    On  25  March  1985,  the  Forsyth  County  District  Court
entered  an  order,  registering  the  separation  agreement.    Then  on
4  September                                                                  1985,  the  court  entered  a  consent  judgment,  which
addressed  additional  issues  between  plaintiff  and  Jerrold.    That
consent  judgment  modified  the  existing  separation  agreement  such
that                                                                          “[Jerrold]  will  provide  in  his  last  will  and  testament,
through  insurance,  or,  if                                                  [Jerrold]  dies  intestate  and  without
insurance,  by  hereby  recognizing  that  plaintiff  has  a  valid
claim  against  defendant’s  estate  for  the  payment  of                    $18,000.00
to plaintiff upon  [Jerrold’s] death.”
Jerrold  died  in  May                                                        2010.                                                             He  was  survived  by  his  wife,
Mary  MacMillan  (defendant).    Jerrold’s  will  contained  a  specific
bequest  of  $18,000.00  to  plaintiff,  pursuant  to  their  agreement.
However,  at  the  time  of  his  death  Jerrold’s  estate  had  assets
totaling  only  $7,500.00.    Those  assets  were  then  distributed  to
defendant  as  part  of  her  year’s  allowance  as  the  surviving




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spouse,  pursuant  to  this  state’s  general  statutes.     Defendant
also  received  more  than  $35,000.00  from  Jerrold’s  life  insurance
policies and IRA account.
On  1  February  2011,  plaintiff  filed  a  motion  in  the  cause,
requesting  that  the  court  impose  a  constructive  trust  for  her
benefit  on  the  funds  received  by  defendant  as  a  result  of
Jerrold’s  death.    Defendant  then  filed  a  motion  to  dismiss  for,
among  other  things,  failure  to  state  a  claim  upon  which  relief
can  be  granted.     On                                                      7  July                                                                      2011,  the  trial  court  entered  an
order  granting  defendant’s  motion  and  dismissing  plaintiff’s
suit  for  failure  to  state  a  claim  upon  which  relief  can  be
granted.    Plaintiff now appeals.
“The  motion  to  dismiss  under  N.C.R.  Civ.  P.  12(b)(6)  tests
the  legal  sufficiency  of  the  complaint.    In  ruling  on  the  motion
the  allegations  of  the  complaint  must  be  viewed  as  admitted,  and
on  that  basis  the  court  must  determine  as  a  matter  of  law
whether  the  allegations  state  a  claim  for  which  relief  may  be
granted.”    Stanback  v.  Stanback,                                          297  N.C.                                                                    181,                                    185,                             254  S.E.2d
611,  615  (1979)  (citations  omitted).                                                                                                                                                           “This  Court  must  conduct  a
                                                                              de   novo   review   of   the   pleadings   to   determine   their   legal
                                                                              sufficiency  and  to  determine  whether  the  trial  court’s  ruling  on
the  motion  to  dismiss  was  correct.”                                                                                                                                                           Leary  v.  N.C.  Forest




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Prods.,  Inc.,  157  N.C.  App.  396,  400,  580  S.E.2d  1,  4,  aff’d  per
curiam,  357 N.C.  567,  597 S.E.2d  673  (2003).
On  appeal,  plaintiff  argues  against  each  of  the  grounds
asserted  in  defendant’s  motion  to  dismiss.    However,  the  order
at  issue  states  that  the  motion  to  dismiss  was  granted  on  only
one  ground,  failure  to  state  a  claim.     Thus,  we  will  only
address  plaintiff’s  argument  with  regards  to  whether  the  trial
court  erred  in  dismissing  her  suit  for  failure  to  state  a  claim.
Upon  review  of  plaintiff’s  pleading,  we  conclude  that  the  trial
court erred in dismissing her suit.
“A  constructive  trust  is  the  formula  through  which  the
conscience  of  equity  finds  expression.  When  property  has  been
acquired  in  such  circumstances  that  the  holder  of  the  legal
title  may  not  in  good  conscience  retain  the  beneficial  interest,
equity  converts  him  into  a  trustee.”    Sara  Lee  Corp.  v.  Carter,
351  N.C.                                                                      27,                 34-35,            519  S.E.2d   308,          313   (1999)   (quotations  and
citation  omitted).    Courts  will  impose  “a  constructive  trust  to
prevent  the  unjust  enrichment  of  the  holder  of  the  legal  title
to  property  acquired  through  a  breach  of  duty,  fraud,  or  other
circumstances  which  make  it  inequitable  for                               [the  holder]  to
retain   it   against   the   claim   of   the   beneficiary   of   the
constructive  trust.”    Id.  at                                               35,                 519  S.E.2d  at   313           (quotations




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and  citations  omitted).                                                     “[T]here  is  a  common,  indispensable
element   in   the   many   types   of   situations   out   of   which   a
constructive  trust  is  deemed  to  arise.    This  common  element  is
some  fraud,  breach  of  duty  or  other  wrongdoing  by  the  holder  of
the  property,  or  by  one  under  whom                                      [the  holder]  claims[.]”
Roper  v.  Edwards,                                                           323  N.C.                                 461,                                  464,   373  S.E.2d   423,                 423-24
(1988)                                                                        (quotations   and   citation   omitted)                                                              (emphasis   added)
(alteration in original).
Here,  plaintiff’s  pleading  alleges  1)  that  pursuant  to  two
court  orders  Jerrold  was  to  provide  the  sum  of                        $38,000.00  to
plaintiff  through  his  last  will  and  testament,  2)  that  according
to   those   court   orders   any   of   Jerrold’s   assets,   including
insurance  policies,  could  be  used  to  pay  the  sum  owed,               3)  that
at  the  time  of  his  death,  Jerrold’s  probate  estate  possessed
insufficient  funds  to  pay  plaintiff,  4)  that  also  at  the  time  of
his  death  Jerrold  owned  three  life  insurance  policies  totaling
$25,000.00,  and  an  accidental  death  policy  of  unknown  value,  5)
that  the  proceeds  of  those  policies  were  paid  to  Jerrold’s
widow,    defendant,    and                                                   6)                                        that    Jerrold    willfully    and
intentionally  violated  two  court  orders  by  failing  to  designate
his existing assets to plaintiff at the time of his death.




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Thus,  it  is  clear  from  her  pleading  that  plaintiff  has
adequately  alleged  that  the  property  at  issue  here  entered
defendant’s  possession  because  Jerrold  breached  his  duty  under
the  terms  of  the  separation  agreement  and  consent  judgment.    As
a  result,  we  conclude  that  plaintiff’s  motion  adequately  states
a   claim   for   unjust   enrichment   and   the   imposition   of   a
constructive  trust,  and  we  reverse  the  trial  court’s  order
dismissing plaintiff’s suit.
Reversed.
Judges BRYANT and ERVIN concur.
Report per Rule  30(e).

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