December 2, 2015

Cape Hatteras Motel's legal claim against DOT is on hold


A legal claim that Carol and Dave Dawson, owners of the Cape Hatteras Motel, filed in November 2014 against the N.C. Department of Transportation is now on hold, pending the outcome of a bankruptcy filing by the business.

The legal action was filed with the North Carolina Industrial Commission, which is charged under the state's Tort Claims Act with acting as a court to hear and determine claims filed against state agencies, such as NCDOT.

The $1 million in damages that the Dawsons are asking for is the maximum amount available under the Tort Claims Act.

In the Claim and Affidavit that the Dawsons filed with the Industrial Commission, the owners claim that negligence on the part of NCDOT, while executing its duties to maintain Highway 12, has caused them loss of value of their property, lost business income, physical damage to buildings, cost of sand removal, and emotional distress.

DOT, in its own affidavit, denies all the claims and uses contributory negligence by the owners as part of its defense. The response says that the motel owners "failed to take reasonable efforts to protect their property from sand and/or water damage."

At a pre-trial hearing last January, Deputy Commissioner J. Brad Donovan, set a schedule for proceeding in the tort claim, which would have had the legal action ready for a hearing on the merits of the claim by Jan. 1.

A discovery schedule Donovan set was agreed on by all parties and included:

  • All written discovery shall be completed by April 15.
  • Plaintiffs shall designate their expert witnesses by May 15 and complete the depositions of their experts by July 1.
  • Defendant shall designate their expert witnesses by Aug. 1 and complete the depositions of their experts by Sept. 15.
  • The parties shall designate any rebuttal expert witnesses and complete those depositions by Nov. 15.
  • All dispositive motions shall be filed no later than Dec. 15.

However, on Oct. 15, Donovan signed off on a stay in the case.

The attorney for the Dawsons, James L. Conner II, who is with the law firm of Calhoun, Bhella, & Sechrest in Durham, N.C., confirmed this week that the case is still stayed and that the motel did file for protection under Chapter 11 of the Bankruptcy Code.

"This is commonly called a 'reorganization,'" Conner said in an e-mail. "It does not mean the motel is going out of business.  Instead, the court reorganizes the debts and the motel hopefully comes out stronger and able to continue in business for a long time."

According to Donovan's order, the case is stayed -- or on hold -- until final resolution of the Chapter 11 filing and another related Superior court case.


Click here to read a copy of the Tort Claim and Affidavit.

Click here to read DOT's answer to the tort claim, motions to dismiss, and defenses.


Cape Hatteras Motel owners file tort claim against DOT
NCDOT says it's not responsible for damages at Buxton motel
Motions handled, schedule set in tort claim against DOT by Buxton Motel owners

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