General Contractor Not a Lawyer
Barry Zalma
Read the full article at https://lnkd.in/gmQRzFR7 and see the full video at https://lnkd.in/gKMZpQ42 and at https://lnkd.in/gjkV4Kvj and at https://zalma.com/blog plus more than 4300 posts.
Steven Hester Hall appealed from an order granting Defendants’ motion to dismiss Hall’s claims for breach of fiduciary duties, insurance licensing violations, bank fraud, insurance fraud, breach of implied covenant of good faith and fair dealing, harassment, and unfair and deceptive trade practices.
In Steven Hester Hall v. Brunswick Plantation Property Owners Association, Greg Mayol, Cathy Six, And Community Association Management Services, No. COA21-748, 2022-NCCOA-604, Court of Appeals of North Carolina (September 6, 2022) Hall wanted to build a house without the bond required by the Community Associations’ regulations.
FACTUAL BACKGROUND
Hall is a general contractor and the CEO of Eco Lakes Construction, LLC. Eco Lakes owns real property at 649 Covington Drive NW, Calabash, NC (“property”), in the Brunswick Plantation and Golf Course Community (“Community”). Defendants are the Brunswick Plantation Property Owners Association (“Association”); Community Association Management, the property management company for the Association; Greg Mayol, the Community Association Manager for the Community; and Cathy Six, the Administrator for the Architectural Standards Committee for the Association.
The Contract Performance and Master Deportment Agreement (“Master Deportment Agreement”) is a contract between the Architectural Standards Committee and a general contractor on a construction project in the Community. The Master Deportment Agreement requires the general contractor to provide to the Association a $5,000 bond to be held as security for the performance of the construction project in accordance with the community governing documents-the Brunswick Plantation Architectural Plan and Residential Design and Construction Standards, and the Amended and Restated Master Declaration and Development Plan for Brunswick Plantation.
Plaintiff submitted plans to construct a home on the property but did not provide the $5,000 Contractor Compliance Bond required by the Master Deportment Agreement. Defendants declined to act on Plaintiff’s construction proposal until he provided the bond. Plaintiff sought a bond waiver; Defendants declined to issue a waiver. Plaintiff again refused to provide the bond, and Defendants directed Plaintiff to cease construction on the lot.
On 23 April 2021, Plaintiff Hall sued and filed a motion for a temporary restraining order, and motion for a preliminary injunction against Defendants. The trial court denied the motion for a temporary restraining order.
In an amended complaint, Hall alleged breach of fiduciary duties, insurance licensing violations, bank fraud, insurance fraud, breach of the implied covenant of good faith and fair dealing, harassment, and unfair and deceptive trade practices. Defendants moved to dismiss the amended. Hall moved to amend his complaint to add additional causes of action and an additional defendant, and an objection to Defendants’ motion to dismiss. The trial court granted Defendants’ motion to dismiss on 29 July 2021.
DISCUSSION
When dealing with a motion to dismiss the court must liberally construe the allegations and the court should not dismiss the complaint unless it appears beyond a doubt that the plaintiff could not prove any set of facts to support his claim which would entitle him to relief.
The caption of Plaintiff’s complaint indicates that he is bringing actions for breach of fiduciary duties, insurance licensing violations, bank fraud, insurance fraud, breach of implied covenant of good faith and fair dealing, harassment, and unfair and deceptive trade practices. The suit indicates only that Hall is challenging the propriety of the Contractor Compliance Bond as required by the Master Deportment Agreement. Hall failed to state a claim upon which relief may be granted under some legal theory.
Standing
In order for a court to have subject matter jurisdiction to hear a claim, the party bringing the claim must have standing. Standing means that the party has a sufficient stake in an otherwise justiciable controversy to obtain judicial resolution of that controversy. Every claim must be prosecuted in the name of the real party in interest. A real party in interest is a party who is benefited or injured by the judgment in the case. A lack of standing may be challenged by motion to dismiss for failure to state a claim upon which relief may be granted.
The court noted that Hall appeared to argue that the Amended and Restated Master Declaration and Development Plan for Brunswick Plantation was unenforceable because it is ambiguous and is a restrictive covenant on the property. Plaintiff does not own the property, nor does he have a protected legal interest in the property. Accordingly he lacked standing to bring this action.
In the alternative, the trial court dismissed Plaintiff’s claims because Plaintiff did not have the authority to bring suit on behalf of Eco Lakes. In North Carolina a corporation must be represented by a duly admitted and licensed attorney-at-law and cannot proceed pro se.
Here, there is no indication that Plaintiff is a licensed attorney. Rather, Plaintiff is a general contractor and is the president and CEO of Eco Lakes. To the extent Plaintiff purports to bring claims on behalf of Eco Lakes, he may not do so.
The trial court’s order dismissing Plaintiff’s complaint was affirmed.
ZALMA OPINION
This case is an example of the misuse by a litigant of allegations of insurance fraud and the tort of bad faith which had no relationship to the problem. To avoid buying a miniscule $5,000 bond, Hall fled suit alleging the planned community where he wanted to build a house accusing the defendants of multiple torts and the crime of insurance fraud because they insisted he obtain a bond. He had no standing and was, if anything, attempting to bludgeon the defendants and cause it to retain counsel and defend this spurious claim. The Court of Appeal refused to honor his scheme and should have sanctioned him for bringing the case without standing.
(c) 2022 Barry Zalma & ClaimSchool, Inc.
Barry Zalma, Esq., CFE, now limits his practice to service as an insurance consultant specializing in insurance coverage, insurance claims handling, insurance bad faith and insurance fraud almost equally for insurers and policyholders. He practiced law in California for more than 44 years as an insurance coverage and claims handling lawyer and more than 54 years in the insurance business. He is available at and [email protected].
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Commit Insurance Fraud While on Probation Violation Requires Jail
Post number 5322
Read the full article at https://lnkd.in/gfnYSb8a, see the video at https://lnkd.in/gEu8EzYq and at https://lnkd.in/gzrJdPfC and at https://zalma.com/blog plus more than 5300 posts.
Jail is Necessary When Probation is Violated
In United States of America v. Sabine Oltmann, No. 25-60578, United States Court of Appeals, Fifth Circuit (April 9, 2026), Sabine Oltmann pleaded guilty to unauthorized opening of mail by a postal employee and was sentenced to two years’ probation.
Just two months into that term, however, she violated the conditions of her probation by submitting a false insurance claim and falsely reporting a crime. The district court revoked her probation and sentenced her to twelve months’ imprisonment followed by twelve months of supervised release.
Oltmann contended that this above-Guidelines revocation sentence is substantively unreasonable.
The USCA reviewes probation-revocation sentences under the ...
Commit Insurance Fraud While on Probation Violation Requires Jail
Post number 5322
Read the full article at https://lnkd.in/gfnYSb8a, see the video at https://lnkd.in/gEu8EzYq and at https://lnkd.in/gzrJdPfC and at https://zalma.com/blog plus more than 5300 posts.
Jail is Necessary When Probation is Violated
In United States of America v. Sabine Oltmann, No. 25-60578, United States Court of Appeals, Fifth Circuit (April 9, 2026), Sabine Oltmann pleaded guilty to unauthorized opening of mail by a postal employee and was sentenced to two years’ probation.
Just two months into that term, however, she violated the conditions of her probation by submitting a false insurance claim and falsely reporting a crime. The district court revoked her probation and sentenced her to twelve months’ imprisonment followed by twelve months of supervised release.
Oltmann contended that this above-Guidelines revocation sentence is substantively unreasonable.
The USCA reviewes probation-revocation sentences under the ...
There is no Privity Between Adjuster & an Insured
A Claim Against an Insurer for Wrongful Conduct Cannot Be Maintained Against Its Adjuster
Post number 5321
See the video at https://lnkd.in/gH6wPd45 and at https://lnkd.in/gB-7JpHZ and at https://zalma.com/blog plus more than 5300 posts.
In Lambert v. SafePort Insurance Company, et al., Civil Action No. 25-1446 (E.D. La. Apr. 2, 2026) (Morgan, J.) Plaintiff Lisa Lambert held a homeowner’s insurance policy issued by SafePort Insurance Company covering her property against windstorms and wind damage. After two separate windstorms damaged her home (the “First Wind Claim” and “Second Wind Claim”), she promptly reported both losses and attempted to mitigate damages.
FACTUAL BACKGROUND
SageSure Insurance Managers LLC acted as the claims adjuster/manager for SafePort. In both instances:
A field adjuster inspected the property and denied coverage, attributing the damage to “foundation settling as a result of earth movement” (an excluded peril that allegedly caused water pooling on the ...
ZIFL – Volume 30, Issue 7 – April 1, 2026
THE SOURCE FOR THE INSURANCE FRAUD PROFESSIONAL
Post number 5314
Posted on April 1, 2026 by Barry Zalma
Zalma’s Insurance Fraud Letter (ZIFL) continues its 30th year of publication dedicated to those involved in reducing the effect of insurance fraud. ZIFL is published 24 times a year by ClaimSchool and is written by Barry Zalma. It is provided FREE to anyone who visits the site at http://zalma.com/zalmas-insurance-fraud-letter-2/ This issue contains the following articles about insurance fraud:
No One is Above the Law – Not Even a Police Officer
Police Officer Convicted for Fraud in Reporting an Accident Affirmed
Police Officer Should never Lie about Results of Chase
In State Of Ohio v. Anthony Holmes, No. 115123, 2026-Ohio-736, Court of Appeals of Ohio, Eighth District, Cuyahoga (March 5, 2026) a police officer appealed criminal conviction as a result of lies about a high speed chase.
Read the following article and the full issue of ZIFL at https://zalma.com/blog/wp-content/uploads/2026/03/ZIFL-04-01-2026-1.pdf...
ZIFL – Volume 30, Issue 7 – April 1, 2026
THE SOURCE FOR THE INSURANCE FRAUD PROFESSIONAL
Post number 5314
Posted on April 1, 2026 by Barry Zalma
Zalma’s Insurance Fraud Letter (ZIFL) continues its 30th year of publication dedicated to those involved in reducing the effect of insurance fraud. ZIFL is published 24 times a year by ClaimSchool and is written by Barry Zalma. It is provided FREE to anyone who visits the site at http://zalma.com/zalmas-insurance-fraud-letter-2/ This issue contains the following articles about insurance fraud:
No One is Above the Law – Not Even a Police Officer
Police Officer Convicted for Fraud in Reporting an Accident Affirmed
Police Officer Should never Lie about Results of Chase
In State Of Ohio v. Anthony Holmes, No. 115123, 2026-Ohio-736, Court of Appeals of Ohio, Eighth District, Cuyahoga (March 5, 2026) a police officer appealed criminal conviction as a result of lies about a high speed chase.
Read the following article and the full issue of ZIFL at https://zalma.com/blog/wp-content/uploads/2026/03/ZIFL-04-01-2026-1.pdf...
Posted on March 30, 2026 by Barry Zalma
Insurance Fraud, a Way to Reduce Violent Crime
Post number 5313
A Fictionalized True Crime Story of Insurance Fraud from an Expert who explains why Insurance Fraud is a “Heads I Win, Tails You Lose” situation for Insurers. The story helps to Understand How Insurance Fraud in America is Costing Everyone who Buys Insurance Thousands of Dollars Every year and Why Insurance Fraud is Safer and More Profitable for the Perpetrators than any Other Crime.
She Taught Her Customers The Swoop And Squat:
Recently the California Insurance Department’s Fraud Division arrested a young woman in Los Angeles County for operating an insurance fraud school. She advertised her classes in the “Penny Saver” an advertising sheet distributed free to the public and a print version of Facebook, X Craig’s list. She had operated for several years teaching methods of committing automobile insurance fraud. Only after a police officer enrolled in one of her classes was she arrested.
Her defense ...