On July 2, 2019, a divided North Carolina Court of Appeals panel effectively changed the statute of limitations to actions for reformation of a deed of trust that has been a source of confusion in North Carolina for more than a century, creating a rule that barred all claims for fraud or mistake in a deed of trust after ten years of execution of the written instrument.
On April 28, 2021, Rebecca Ugolick and Douglas Noreen went before the North Carolina Supreme Court to be heard in conjunction with Wells Fargo Bank. During oral argument, Ms. Ugolick stressed that property owners and creditors in North Carolina would be victimized by the decision rendered by the Court of Appeals, stripping their rights from otherwise meritorious claims for reformation of a written instrument on the basis of fraud or mistake.
In the August 13, 2021 decision rendered by our State Supreme Court, Chief Justice Newby wrote for the majority and clarified that a cause of action (such as the reformation of deed of trust in this case) should not be deemed to have accrued until the discovery of the fraud or mistake pursuant to N.C.G.S. § 1-52(9). Ms. Ugolick and Mr. Noreen are proud to have been a part of ensuring that the three-year statute of limitations under N.C.G.S. § 1-52(9) in relation to the discovery of fraud or mistake in written instruments remains well-established law in our state to protect the rights of North Carolina property holders and creditors.
The August 13, 2021 decision also contains important analysis of fact, including a review of “mutual mistake” and collateral rights that will be helpful in interpreting similar scenarios for property holders and creditors in the future. In the years leading up to this landmark decision, Ms. Ugolick and Mr. Noreen extensively briefed the issue in conjunction with Wells Fargo Bank which can be found in the record on appeal. See Wells Fargo Bank, N.A. v. Stocks, No. 296A19, 2021 N.C. LEXIS 710 (Aug. 13, 2021) the complete opinion.
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