Union County Board Of Education v. Union County Board of Commissioners ( 2015 )


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  •             IN THE COURT OF APPEALS OF NORTH CAROLINA
    No. COA14-633
    Filed: 7 April 2015
    Union County, No. 13 CVS 2063
    UNION COUNTY BOARD OF EDUCATION, Plaintiff,
    v.
    UNION COUNTY BOARD OF COMMISSIONERS, Defendant.
    Appeal by defendant from judgment entered 10 October 2013 by Judge W.
    Erwin Spainhour in Union County Superior Court. Heard in the Court of Appeals 2
    December 2014.
    Schwartz & Shaw, P.L.L.C., by Richard Schwartz and Brian C. Shaw, for
    plaintiff-appellee.
    Wyrick Robbins Yates & Ponton LLP, by K. Edward Greene and Tobias S.
    Hampson; and Perry, Bundy, Plyler, Long & Cox, LLP, by H. Ligon Bundy and
    Christopher Cox, for defendant-appellant.
    Brooks, Pierce, McLendon, Humphrey & Leonard, LLP, by Jill R. Wilson and
    Julia C. Ambrose; and the North Carolina School Boards Association, by
    Allison B. Schafer and Christine T. Scheef, on behalf of the North Carolina
    School Boards Association, amicus curiae.
    Smith Moore Leatherwood LLP, by Elizabeth Brooks Scherer, Matthew Nis
    Leerberg, and Thomas E. Terrell, Jr., on behalf of the North Carolina
    Association of County Commissioners, amicus curiae.
    McCULLOUGH, Judge.
    The Union County Board of Commissioners (“defendant”) appeals from a
    judgment ordering it to appropriate additional funds to the Union County Board of
    UNION COUNTY BOARD OF EDUCATION V. UNION COUNTY BOARD OF COMMISSIONERS
    Opinion of the Court
    Education’s (“plaintiff”) local current expense and capital outlay funds for the 2013-
    2014 fiscal year. For the following reasons, we grant a new trial.
    I.      Background
    This case concerns funding provided by defendant to plaintiff for the 2013-2014
    fiscal year. The School Budget and Fiscal Control Act (the “Act”), N.C. Gen. Stat. §
    115C-422 et seq., governs such funding.
    In general, the Act requires that “[e]ach local school administrative unit shall
    operate under an annual balanced budget resolution[,]” N.C. Gen. Stat. § 115C-425(a)
    (2013), which shall include at least the following funds: the State Public School Fund;
    the local current expense fund; and the capital outlay fund. N.C. Gen. Stat. § 115C-
    426(c) (2013). Pertinent to this case,
    The local current expense fund shall include
    appropriations sufficient, when added to appropriations
    from the State Public School Fund, for the current
    operating expense of the public school system in conformity
    with the educational goals and policies of the State and the
    local board of education, within the financial resources and
    consistent with the fiscal policies of the board of county
    commissioners. These appropriations shall be funded by
    revenues accruing to the local school administrative unit
    by virtue of Article IX, Sec. 7 of the Constitution, moneys
    made available to the local school administrative unit by
    the board of county commissioners, supplemental taxes
    levied by or on behalf of the local school administrative unit
    pursuant to a local act or [N.C. Gen. Stat. §§] 115C-501 to
    115C-511, State money disbursed directly to the local
    school administrative unit, and other moneys made
    available or accruing to the local school administrative unit
    for the current operating expenses of the public school
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    UNION COUNTY BOARD OF EDUCATION V. UNION COUNTY BOARD OF COMMISSIONERS
    Opinion of the Court
    system.
    N.C. Gen. Stat. § 115C-426(e).
    The capital outlay fund shall include appropriations for:
    (1) The acquisition of real property for school purposes,
    including but not limited to school sites, playgrounds,
    athletic fields, administrative headquarters, and
    garages.
    (2) The acquisition, construction, reconstruction,
    enlargement, renovation, or replacement of buildings
    and other structures, including but not limited to
    buildings for classrooms and laboratories, physical and
    vocational educational purposes, libraries, auditoriums,
    gymnasiums, administrative offices, storage, and
    vehicle maintenance.
    (3) The acquisition or replacement of furniture and
    furnishings, instructional apparatus, data-processing
    equipment, business machines, and similar items of
    furnishings and equipment.
    (4) The acquisition of school buses as additions to the
    fleet.
    (5) The acquisition of activity buses and other motor
    vehicles.
    (6) Such other objects of expenditure as may be
    assigned to the capital outlay fund by the uniform
    budget format.
    ....
    Appropriations in the capital outlay fund shall be funded
    by revenues made available for capital outlay purposes by
    the State Board of Education and the board of county
    commissioners, supplemental taxes levied by or on behalf
    of the local school administrative unit pursuant to a local
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    UNION COUNTY BOARD OF EDUCATION V. UNION COUNTY BOARD OF COMMISSIONERS
    Opinion of the Court
    act or [N.C. Gen. Stat. §§] 115C-501 to 115C-511, the
    proceeds of the sale of capital assets, the proceeds of claims
    against fire and casualty insurance policies, and other
    sources.
    N.C. Gen. Stat. § 115C-426(f).
    Furthermore, plaintiff and defendant are encouraged under the Act “to conduct
    periodic joint meetings during each fiscal year[]” “[i]n order to promote greater
    mutual understanding of immediate and long-term budgetary issues and
    constraints[.]” N.C. Gen. Stat. § 115C-426.2 (2013). “In particular, the boards are
    encouraged to assess the school capital outlay needs, to develop and update a joint
    five-year plan for meeting those needs, and to consider this plan in the preparation
    and approval of each year's budget under [the Act].” 
    Id. Concerning budgets,
    the Act
    outlines a process and timeline for the preparation, proposal, approval, and
    submission by plaintiff to defendant of each year’s budget; as well as defendant’s
    action on plaintiff’s proposed budget. See N.C. Gen. Stat. §§ 115C-427 to -429.
    In the present case, on 15 April 2013, plaintiff submitted its proposed budget
    for the 2013-2014 fiscal year to defendant in accordance with the requirements of
    N.C. Gen. Stat. § 115C-429(a).1 In the budget, plaintiff requested $86,180,152 in local
    current expense funding and $8,357,859 in capital outlay funding. Upon review of
    plaintiff’s proposed budget, on 17 June 2013, defendant adopted the county 2013-2014
    1 “Fiscal year” is defined in the Act as “the annual period for the compilation of fiscal
    operations. The fiscal year begins on July 1 and ends on June 30.” N.C. Gen. Stat. § 115C-423(4)
    (2013).
    4
    UNION COUNTY BOARD OF EDUCATION V. UNION COUNTY BOARD OF COMMISSIONERS
    Opinion of the Court
    budget ordinance. The budget ordinance included appropriations to plaintiff in the
    amount of $82,260,408 for local current expense and $3,000,000 for capital outlay,
    resulting in shortfalls of $3,919,744 for local current expense and $5,357,859 for
    capital outlay.
    In response to the county 2013-2014 budget ordinance, on 18 June 2013,
    plaintiff adopted a resolution in which it determined “the amounts of money
    appropriated by [defendant] for the 2013-2014 school year to [plaintiff’s] local current
    expense fund and capital outlay fund [were] not sufficient . . . to support a system of
    free public schools[.]” Thus, plaintiff directed its Chairman, superintendent, and
    attorneys to take the appropriate steps under N.C. Gen. Stat. § 115C-431 to resolve
    the budget dispute.    In reaching the determination that the appropriations by
    defendant were inadequate, plaintiff indicated that, in addition to considering the
    amount of funds appropriated by defendant and defendant’s ability to provide
    additional funding, it “considered the cumulative effect of the County of Union’s
    inadequate appropriations for current expense and capital outlay in the preceding
    fiscal years[.]”
    In accordance with the procedures set forth in N.C. Gen. Stat. § 115C-431(a)
    and (b), plaintiff and defendant participated in a joint meeting on 24 June 2013 in an
    attempt to resolve the budget dispute. When the parties failed to reach an agreement
    at the joint meeting, the parties participated in mediation sessions on 24 June,
    5
    UNION COUNTY BOARD OF EDUCATION V. UNION COUNTY BOARD OF COMMISSIONERS
    Opinion of the Court
    28 June, and 31 July 2013. The mediation efforts concluded on 31 July 2013 with the
    mediator declaring an impasse.
    The following day, 1 August 2013, plaintiff initiated this action against
    defendant pursuant to N.C. Gen. Stat. § 115C-431(c).         In plaintiff’s complaint,
    plaintiff sought “a determination of (i) the amount of money legally necessary from
    all sources and (ii) the amount of money legally necessary from [defendant], in order
    to maintain a system of free public schools as defined by State law and State Board
    of Education policy.”
    Defendant responded to plaintiff’s complaint by answer filed 12 August 2013,
    the same day the case came on for trial in Union County Superior Court before the
    Honorable W. Erwin Spainhour.
    Following a lengthy trial, on 10 October 2013, the jury returned a verdict
    finding that $326,498,487 in current expense funding and $89,184,005 in capital
    outlay funding was legally necessary from all sources in order to maintain a system
    of free public schools. The jury also found that an additional $4,973,134 in current
    expense funding and an additional $86,184,005 in capital outlay funding, beyond the
    amounts already appropriated by defendant, was legally necessary from defendant
    in order to maintain a system of free public schools.
    The trial court entered judgment on the jury verdict ordering defendant “to
    appropriate to the local current expense fund of . . . [p]laintiff . . . the additional
    6
    UNION COUNTY BOARD OF EDUCATION V. UNION COUNTY BOARD OF COMMISSIONERS
    Opinion of the Court
    amount of $4,973,134 for fiscal year 2013-2014, above that amount appropriated in
    the Union County Budget Ordinance adopted on June 17, 2013[]” and “to appropriate
    to the capital outlay fund of . . . [p]laintiff . . . the additional amount of $86,184,005
    for fiscal year 2013-2014, above that amount appropriated in the Union County
    Budget Ordinance adopted on June 17, 2013.”               The trial court also authorized
    defendant, in accordance with N.C. Gen. Stat. § 115C-431, “to levy such taxes on
    property as it may choose to make up the difference, if any, when added to other
    revenues available for these purposes.” Defendant filed notice of appeal from the
    judgment on 17 October 2013.
    II.    Discussion
    Defendant raises the following four issues on appeal: whether the trial court
    erred by (1) allowing plaintiff to argue an improper legal standard in its opening
    statements; (2) allowing plaintiff to present evidence of claimed needs outside the
    scope of plaintiff’s proposed budget for the 2013-2014 fiscal year; (3) denying
    defendant’s motions for a directed verdict; and (4) instructing the jury to apply a
    broad rather than restrictive definition of the amount legally necessary to maintain
    a system of free public schools in Union County.
    1.    Plaintiff’s Opening Statements
    Defendant first argues the trial court erred by allowing plaintiff to argue an
    improper legal standard in plaintiff’s opening statements. As both parties agree, we
    7
    UNION COUNTY BOARD OF EDUCATION V. UNION COUNTY BOARD OF COMMISSIONERS
    Opinion of the Court
    review the trial court’s decisions regarding opening statements for an abuse of
    discretion. See State v. Speller, 
    345 N.C. 600
    , 606, 
    481 S.E.2d 284
    , 287 (1997) (“The
    control of opening statements rests in the discretion of the trial court.”).
    During opening statements in this case, plaintiff stated the following while
    explaining the issues to be decided by the jury:
    The issue that you’re going to be asked to decide is
    the amount of money needed from the Commissioners to
    maintain the schools. It’s not the amount of money needed
    to open the doors. That’s not the standard. The standard
    is higher than that. We’re going to open the doors. Come
    hell or high water, we’re going to open the doors when those
    kids come. I’m going to get that off the table right now. So
    that’s not an issue. But the standard is much higher than
    that, and the expectations are much higher than that. So
    the amount needed is now in your hands. It’s up to you to
    determine. It’s entirely up to you.
    The Courts have made clear that the amount needed
    is not that which is absolutely necessary; it’s that which is
    legally necessary, and reasonable and useful for the
    purposes sought. In making your decision, you have an
    opportunity to touch the future --
    Upon hearing plaintiff’s explanation of “the amount needed,” defendant objected on
    the basis that plaintiff incorrectly stated the legal standard. The trial court, however,
    allowed plaintiff to continue without correction, stating, “[w]ell, it’s [sic] opening
    statement.   We’ll see where -- what the evidence will show.”          Now on appeal,
    defendant contends the trial court erred because plaintiff’s statement of the legal
    standard was similar to that rejected by our Supreme Court in Beaufort Cnty. Bd. of
    Educ. v. Beaufort Cnty. Bd. of Comm’rs, 
    363 N.C. 500
    , 
    681 S.E.2d 278
    (2009).
    8
    UNION COUNTY BOARD OF EDUCATION V. UNION COUNTY BOARD OF COMMISSIONERS
    Opinion of the Court
    At the time Beaufort was decided, in any action brought to resolve a budget
    dispute pursuant to N.C. Gen. Stat. § 115C-431(c), “the trial court [was] charged to
    ‘find the facts as to the amount of money necessary to maintain a system of free public
    schools, and the amount of money needed from the county to make up this total.’ ”
    
    Id. at 503,
    681 S.E.2d at 281 (quoting N.C. Gen. Stat. § 115C-431(c) (2007)).
    In Beaufort, our Supreme Court addressed the constitutionality of the
    statutory framework in N.C. Gen. Stat. § 115C-431(c) for resolving budget disputes
    and reviewed whether the statutory framework was properly applied in the case. 
    Id. at 502,
    681 S.E.2d at 280. In doing so, the Court considered “the meaning of the terms
    ‘necessary’ and ‘needed,’ as used in [N.C. Gen. Stat. § 115C-]431(c), in light of Article
    IX, Section 2(2) of the State Constitution.” 
    Id. at 505,
    681 S.E.2d at 283. Upon
    recognizing the terms were “susceptible to reasonable interpretations of varying
    strictness,” and that, “[i]f a fact-finder were to interpret ‘necessary’ or ‘needed’ in
    [N.C. Gen. Stat. § 115C-]431(c) expansively, there [was] a danger that the resulting
    verdict could intrude on a county commission's funding discretion under Article IX,
    Section 2(2) . . . [,]” the Court adopted a restrictive interpretation of the terms
    “necessary” and “needed.” 
    Id. at 505-06,
    681 S.E.2d at 283. The Court explained
    that, “[s]o construed, [N.C. Gen. Stat. § 115C-]431(c)'s requirement that county
    commissions provide the minimum level of funding required by state law does not
    abrogate their discretionary authority to contribute more.” 
    Id. 9 UNION
    COUNTY BOARD OF EDUCATION V. UNION COUNTY BOARD OF COMMISSIONERS
    Opinion of the Court
    Our Supreme Court then addressed whether the Beaufort trial court erred
    when it “instructed the jury that the word ‘needed’ in [N.C. Gen. Stat. § 115C-]431(c)
    means that which is reasonable and useful and proper or conducive to the end
    sought.” 
    Id. at 507,
    681 S.E.2d at 283 (quotation marks omitted). Having determined
    a restrictive interpretation of the terms “necessary” and “needed” was necessary to
    preserve the discretionary authority of county commissions, the Court held the
    instruction to the jury in Beaufort “conveyed an impermissible, expansive definition”
    and was in error. 
    Id. Thus, the
    Court remanded the case for a new trial noting the
    following:
    At that trial, the trial court should instruct the jury that
    [N.C. Gen. Stat. § 115C-]431(c) requires the County
    Commission to provide that appropriation legally necessary
    to support a system of free public schools, as defined by
    Chapter 115C and the policies of the State Board. The trial
    court should also instruct the jury, in arriving at its verdict,
    to consider the educational goals and policies of the state,
    the budgetary request of the local board of education, the
    financial resources of the county, and the fiscal policies of
    the board of county commissioners. See [N.C. Gen. Stat.] §
    115C–426(e) (2007). Anything beyond this measure of
    damages impermissibly infringes upon the discretionary
    authority of the County Commission under Article IX,
    Section 2(2) of the State Constitution and may not be
    awarded by a jury.
    
    Id. at 507,
    681 S.E.2d at 283-84 (emphasis added).2
    2  Subsequent to the Beaufort decision and during the pendency of the current budget dispute,
    prior to the filing of this case, the General Assembly amended N.C. Gen. Stat. § 115C-431(c) to reflect
    the Court’s holding in Beaufort. Thus, N.C. Gen. Stat. § 115C-431(c) now charges the fact finder to
    10
    UNION COUNTY BOARD OF EDUCATION V. UNION COUNTY BOARD OF COMMISSIONERS
    Opinion of the Court
    As noted above, in this case, plaintiff stated to the jury during its opening
    statements that the standard to be applied in determining the amount of funding “is
    not that which is absolutely necessary; it’s that which is legally necessary, and
    reasonable and useful for the purposes sought.”                   Although, the standard
    communicated by plaintiff to the jury is similar to the one rejected in Beaufort,
    plaintiff contends its use of the “reasonable and useful” language was not inconsistent
    with Beaufort because the language was joined to the correct standard, “legally
    necessary,” by the conjunction “and” and therefore did not supersede what was
    “legally necessary.”     While plaintiff’s argument is technically correct, we find
    plaintiff’s statement of the standard to the jury misleading and, therefore, hold the
    trial court erred in allowing plaintiff to communicate a standard that included
    language mirroring that rejected in Beaufort. Nevertheless, we hold the error was
    harmless.
    In charging the jury in Beaufort, the trial court instructed the jury to apply a
    broad definition of “needed” and “necessary” to determine the amount of funding to
    be awarded. In the present case, however, the overly broad language rejected in
    Beaufort was only communicated to the jury in plaintiff’s opening statements.
    Following weeks of evidence, the trial court instructed the jury that it must apply the
    determine the amount of money “legally necessary” as opposed to the amount of money “needed” and
    “necessary.” 2013 N.C. Sess. Laws 2013-141, sec. 1, eff. June 19, 2013.
    11
    UNION COUNTY BOARD OF EDUCATION V. UNION COUNTY BOARD OF COMMISSIONERS
    Opinion of the Court
    law it provides in the jury instructions and stated the proper legal standard as
    follows:
    The issue to be decided by you, the jury, is as follows:
    “What amount of money is legally necessary from all
    sources and what amount of money is legally necessary
    from the board of county commissioners in order to
    maintain a system of free public schools as defined by state
    law and State Board of Education policy?”
    (Emphasis added.) The trial court then repeatedly emphasized the proper legal
    standard throughout its instructions to the jury without reference to the language
    rejected in Beaufort. Moreover, the trial court provided the jury with verdict sheets
    incorporating the correct legal standard. As a result of the trial court’s instructions
    and the verdict sheets, we hold defendant was not prejudiced by plaintiff’s improper
    statements during its opening statements to the jury.
    2.      Evidence
    Defendant next argues the trial court erred by allowing plaintiff to present
    evidence of claimed needs outside the scope of plaintiff’s proposed budget for the 2013-
    2014 fiscal year.
    Generally, we review the trial court’s decisions regarding the admissibility of
    evidence for abuse of discretion, see State v. Shuford, 
    337 N.C. 641
    , 649, 
    447 S.E.2d 742
    , 747 (1994), and “[e]videntiary errors are [considered] harmless unless . . . a
    different result would have been reached at trial.” State v. Ferguson, 
    145 N.C. App. 302
    , 307, 
    549 S.E.2d 889
    , 893, disc. review denied, 
    354 N.C. 223
    , 
    554 S.E.2d 650
    12
    UNION COUNTY BOARD OF EDUCATION V. UNION COUNTY BOARD OF COMMISSIONERS
    Opinion of the Court
    (2001). Yet, a trial court’s rulings on relevancy are not technically discretionary and
    therefore are not afforded as much deference. See Dunn v. Custer, 
    162 N.C. App. 259
    ,
    266, 
    591 S.E.2d 11
    , 17 (2004).
    On the day the case came on for trial, 12 August 2013, defendant filed a motion
    in limine in which defendant sought to exclude the following:
    4.      Any       suggestion,      information,      documents,
    statements, or evidence of capital outlay needs
    that . . . [p]laintiff did not request . . . [d]efendant to fund
    in its 2013-2014 [fiscal year] budget, or information,
    documents, statement, or evidence of the future capital
    outlay needs of . . . [p]laintiff upon the grounds
    that . . . [p]laintiff is required by [N.C. Gen. Stat. §] 115C-
    521(b) to present its request for capital needs for each fiscal
    year with its annual budget, and [d]efendant has no duty
    to fund any item of [p]laintiff’s capital needs
    until . . . [p]laintiff has made a request for such needs.
    5.     Any         suggestion,       information,    documents,
    statements, or evidence that [d]efendant has failed to
    provide adequate funding for current expense and/or
    capital outlay in years preceding the 2013-2014 fiscal year,
    upon the grounds that the issue before the Court concerns
    whether       .      .   .     [d]efendant     has    adequately
    funded . . . [p]laintiff's proposed 2013-2014 budget request,
    in order for . . . [p]laintiff to “support a system of free public
    schools.” Plaintiff has the annual right and duty under
    [N.C. Gen. Stat. §] 115C-431 to institute a proceeding each
    year for additional funding if it determines that
    [d]efendant has not adequately provided sufficient local
    funds to support a system of free public schools for that
    fiscal year. Once [p]laintiff has accepted the money
    appropriated by [d]efendant for a fiscal year and has
    adopted its own budget, it has acknowledged that it has
    been adequately funded for that fiscal year, and may not
    later contend that it was inadequately funded for that year.
    13
    UNION COUNTY BOARD OF EDUCATION V. UNION COUNTY BOARD OF COMMISSIONERS
    Opinion of the Court
    During arguments on the motion, defendant explained to the trial court that
    plaintiff indicated it had capital outlay needs beyond those in the proposed budget
    and that it would seek additional capital outlay funding beyond the $5,357,859
    portion of the proposed budget for capital outlay that defendant did not fund in the
    county budget ordinance. Defendant indicated “that’s what [the] motion is directed
    at; is [plaintiff’s] contention that they are entitled to present evidence and seek more
    than they requested in their . . . [proposed budget].” Defendant then asserted plaintiff
    was bound by the proposed budget for the 2013-2014 fiscal year.
    In response, plaintiff looked to the language of N.C. Gen. Stat. § 115C-431(c)
    and argued the statute was specific and clear that “the issue to be submitted to the
    jury is that the jury finds the amount needed to maintain a system of free public
    schools[.]” Plaintiff then argued they should be able to present any evidence of the
    actual needs of the school system without regard to its proposed budget for the 2013-
    2014 fiscal year because there was nothing in N.C. Gen. Stat. § 115C-431(c)
    restricting the jury’s consideration to the proposed budget. Plaintiff stated N.C. Gen.
    Stat. § 115C-431 does not even mention the proposed budget as a consideration for
    the jury.
    Upon considering the arguments, the trial court denied defendant’s motion,
    reasoning that N.C. Gen. Stat. § 155C-431(c) was very specific and any evidence
    relating to the amount of money legally necessary from all sources and the amount of
    14
    UNION COUNTY BOARD OF EDUCATION V. UNION COUNTY BOARD OF COMMISSIONERS
    Opinion of the Court
    money legally necessary from defendant to support the school system, regardless of
    whether plaintiff requested funding for it in the proposed budget, should be
    considered by the jury. Thereafter, over defendant’s objections at trial, the trial court
    allowed plaintiff to present evidence outside the scope of its proposed budget for the
    2013-2014 fiscal year.
    In order to determine whether the trial court erred in allowing evidence outside
    the scope of plaintiff’s proposed budget for the 2013-2014 fiscal year, we must
    determine the scope of the proceedings; specifically whether the proceedings are
    limited to the proposed budget. Upon review, we hold the budget dispute proceedings
    are limited to a consideration of the proposed budget for the fiscal year at issue and,
    therefore, the trial court erred in this case by allowing evidence outside the scope of
    plaintiff’s proposed budget for the 2013-2014 fiscal year into evidence at trial.
    In reaching this conclusion, we interpret N.C. Gen. Stat. § 115C-431(c) in the
    context of the Act. As this Court explained in Baumann-Chacon v. Baumann,
    [t]he principal goal of statutory construction is to
    accomplish the legislative intent. The best indicia of that
    intent are the language of the statute . . . , the spirit of the
    act and what the act seeks to accomplish. Individual
    expressions must be construed as part of the composite
    whole and be accorded only that meaning which other
    modifying provisions and the clear intent and purpose of
    the act will permit. The Court may also consider the policy
    objectives prompting passage of the statute and should
    avoid a construction which defeats or impairs the purpose
    of the statute.
    15
    UNION COUNTY BOARD OF EDUCATION V. UNION COUNTY BOARD OF COMMISSIONERS
    Opinion of the Court
    
    212 N.C. App. 137
    , 140, 
    710 S.E.2d 431
    , 434 (2011) (quotation marks and citations
    omitted); see also Shelton v. Morehead Mem’l Hosp., 
    318 N.C. 76
    , 81-82, 
    347 S.E.2d 824
    , 828 (1986) (“Legislative intent controls the meaning of a statute; and in
    ascertaining this intent, a court must consider the act as a whole, weighing the
    language of the statute, its spirit, and that which the statute seeks to accomplish.”).
    As stated in N.C. Gen. Stat. § 115C-424, “[i]t [was] the intent of the General
    Assembly by enactment of [the Act] to prescribe for the public schools a uniform
    system of budgeting and fiscal control.” N.C. Gen. Stat. § 115C-424 (2013). In order
    to accomplish this goal, the Act provides a step-by-step budget process. In Beaufort,
    our Supreme Court summarized the process as follows:
    The local school board first creates a budget setting out its
    estimate of the cost of providing education within its locale
    for the upcoming year and submits that budget to the
    county commission. See [N.C. Gen. Stat.] § 115C–429(a)
    (2007). The county commission then determines the
    amount of funds to be appropriated to the school board. See
    [N.C. Gen. Stat.] § 115C–429(b) (2007). If there is a dispute
    between the school board and the county commission, the
    two boards meet with a mediator in an effort to negotiate a
    compromise. See [N.C. Gen. Stat.] § 115C–431(a). If there
    is still no agreement, representatives from the two boards
    enter a formal mediation. See [N.C. Gen. Stat.] § 115C–
    431(b). If no agreement can be reached at the mediation,
    the school board may file an action in superior court. See
    [N.C. Gen. Stat.] § 115C–431(c).
    363 N.C. at 
    503, 681 S.E.2d at 281
    .
    N.C. Gen. Stat. § 115C-431(c), which governs a schools board’s suit against a
    county commission, provides the following:
    16
    UNION COUNTY BOARD OF EDUCATION V. UNION COUNTY BOARD OF COMMISSIONERS
    Opinion of the Court
    (c)    Within five days after an announcement of no
    agreement by the mediator, the local board of education
    may file an action in the superior court division of the
    General Court of Justice. Either board has the right to
    have the issues of fact tried by a jury. When a jury trial is
    demanded, the cause shall be set for the first succeeding
    term of the superior court in the county, and shall take
    precedence over all other business of the court. However,
    if the judge presiding certifies to the Chief Justice of the
    Supreme Court, either before or during the term, that
    because of the accumulation of other business, the public
    interest will be best served by not trying the cause at the
    term next succeeding the filing of the action, the Chief
    Justice shall immediately call a special term of the superior
    court for the county, to convene as soon as possible, and
    assign a judge of the superior court or an emergency judge
    to hold the court, and the cause shall be tried at this special
    term. The judge shall find, or if the issue is submitted to
    the jury, the jury shall find the facts as to the following in
    order to maintain a system of free public schools as defined
    by State law and State Board of Education policy: (i) the
    amount of money legally necessary from all sources and (ii)
    the amount of money legally necessary from the board of
    county commissioners. In making the finding, the judge or
    the jury shall consider the educational goals and policies of
    the State and the local board of education, the budgetary
    request of the local board of education, the financial
    resources of the county and the local board of education,
    and the fiscal policies of the board of county commissioners
    and the local board of education.
    All findings of fact in the superior court, whether found by
    the judge or a jury, shall be conclusive. When the facts
    have been found, the court shall give judgment ordering
    the board of county commissioners to appropriate a sum
    certain to the local school administrative unit, and to levy
    such taxes on property as may be necessary to make up this
    sum when added to other revenues available for the
    purpose.
    N.C. Gen. Stat. § 115C-431(c).
    17
    UNION COUNTY BOARD OF EDUCATION V. UNION COUNTY BOARD OF COMMISSIONERS
    Opinion of the Court
    Plaintiff, just as it argued at trial, looks to this language and argues N.C. Gen.
    Stat. § 115C-431(c) is specific as to the issues to be decided by the jury and because
    there is no language restricting the jury’s determination to those amounts sought in
    its proposed budget, all evidence related to its funding needs was properly admitted.
    Plaintiff further argues the General Assembly could have easily limited the
    proceedings to a consideration of those amounts in the proposed budget had it
    intended to so.
    Although N.C. Gen. Stat. § 115C-431(c) does not explicitly state that the
    proceedings are limited to plaintiff’s proposed budget, sub-section (c) does include
    plaintiff’s proposed budget as one of the mandatory considerations for the fact finder
    in determining the amounts legally necessary to maintain a system of free public
    schools. See N.C. Gen. Stat. § 115C-431(c) (“In making the finding, the judge or the
    jury shall consider . . . the budgetary request of the local board of education . . . .”).
    Moreover, it is evident from the remainder of N.C. Gen. Stat. § 115C-431 that the
    proposed budget is the principal focus of the entire dispute resolution process. Prior
    to the filing of a lawsuit under N.C. Gen. Stat. § 115C-431(c), N.C. Gen. Stat. §§ 115C-
    431(a) and (b) require plaintiff and defendant to attempt to settle the budget dispute
    at a joint meeting and, if necessary, through additional mediation efforts. N.C. Gen.
    Stat. § 115C-431(a), which sets forth guidelines for the joint meeting, states that “[a]t
    the joint meeting, the entire school budget shall be considered carefully and
    18
    UNION COUNTY BOARD OF EDUCATION V. UNION COUNTY BOARD OF COMMISSIONERS
    Opinion of the Court
    judiciously, and the two boards shall make a good-faith attempt to resolve the
    differences that have arisen between them.” N.C. Gen. Stat. § 115C-431(a) (emphasis
    added).
    Based on the language of the N.C. Gen. Stat. § 115C-431, we hold the amounts
    requested in plaintiff’s proposed budget are what are at issue in a budget dispute
    under N.C. Gen. Stat. § 115C-431. This result seems common sense, as a budget
    dispute only arises when defendant does not fully fund plaintiff’s proposed budget.
    We find further support for this conclusion when N.C. Gen. Stat. § 115C-431 is
    viewed in the context of the entire budget process, considering the respective roles of
    plaintiff and defendant.
    N.C. Gen. Stat. § 115C-521(b), which is outside the Act but related to the
    budget process, provides the following:
    It shall be the duty of the boards of education of the several
    local school administrative school units of the State to
    make provisions for the public school term by providing
    adequate school buildings equipped with suitable school
    furniture and apparatus. The needs and the cost of those
    buildings, equipment, and apparatus, shall be presented
    each year when the school budget is submitted to the
    respective tax-levying authorities.         The boards of
    commissioners shall be given a reasonable time to provide
    the funds which they, upon investigation, shall find to be
    necessary for providing their respective units with
    buildings suitably equipped, and it shall be the duty of the
    several boards of county commissioners to provide funds for
    the same.
    19
    UNION COUNTY BOARD OF EDUCATION V. UNION COUNTY BOARD OF COMMISSIONERS
    Opinion of the Court
    N.C. Gen. Stat. § 115C-521(b) (2013) (emphasis added). Thus, as defendant argues,
    it is plaintiff’s role to determine the capital outlay needs of the school system each
    year and to include those costs in their proposed budget each year. Defendant then
    reviews plaintiff’s proposed budget and makes appropriations.
    While plaintiff acknowledges that its role is to determine the amount of
    funding necessary, it argues the proposed budget is just an estimate and it is the fact
    finder who determines the amount legally necessary. Plaintiff argues limiting the
    evidence to the proposed budget in this case would have the effect of authorizing
    legally insufficient funding because the fact finder found funding beyond the amount
    requested in plaintiff’s proposed budget was legally necessary.      Plaintiff further
    contends that defendant was well aware of the school system’s outstanding capital
    needs from prior years that were unfunded and therefore defendant had reasonable
    time to make funding decisions. We are not persuaded by plaintiff’s arguments.
    N.C. Gen. Stat. § 115C-521(b) makes clear that plaintiff must assess the capital
    needs of the school system and present those needs to defendant “each year.” Each
    year is then treated individually in the budget process. By implication, if plaintiff
    does not initiate the dispute resolution process in N.C. Gen. Stat. § 115C-431, it has
    accepted that the appropriations by defendant were sufficient for that year.
    Unfunded requests from prior year’s proposed budgets are not automatically carried
    forward and considered in subsequent years. If plaintiff wants those previously
    20
    UNION COUNTY BOARD OF EDUCATION V. UNION COUNTY BOARD OF COMMISSIONERS
    Opinion of the Court
    unfunded amounts considered, it must include them in the proposed budget for the
    2013-2014 fiscal year.
    Moreover, plaintiff’s argument that limiting the evidence to those amounts
    requested in its proposed budget would authorize legally insufficient funding
    presumes that plaintiff requested an amount of funds below the amount legally
    necessary to maintain a system of free public schools.        We do not accept this
    presumption. While plaintiff’s proposed budget may be an estimate, it is not a blind
    guess and we do not accept plaintiff’s suggestion that it underestimated the capital
    outlay needs of the school system by over $80,000,000.
    The purpose of the budget dispute resolution process outlined in N.C. Gen.
    Stat. § 115C-431 is to provide an expedited process to resolve budget disputes
    between a board of education and a board of county commissioners when the board of
    education’s proposed budget is not fully funded. We hold N.C. Gen. Stat. § 115C-
    431(c) was never intended to open the door to allow the fact finder to consider
    evidence outside the scope of the proposed budget and award funding beyond that
    requested by the board of education, whose duty it is to request sufficient funding to
    maintain a system of free public schools.
    3.       Directed Verdict
    At the conclusion of plaintiff’s evidence, and again at the close of all the
    evidence, defendant moved for a directed verdict on the ground that plaintiff failed to
    21
    UNION COUNTY BOARD OF EDUCATION V. UNION COUNTY BOARD OF COMMISSIONERS
    Opinion of the Court
    present sufficient evidence for the jury to decide the amount of money legally
    necessary to maintain a system of free public schools. The trial court denied both
    motions.
    In this third issue on appeal, defendant now contends the trial court erred in
    denying its motions for a directed verdict.
    “The standard of review of directed verdict is whether the evidence, taken in
    the light most favorable to the non-moving party, is sufficient as a matter of law to
    be submitted to the jury.” Davis v. Dennis Lilly Co., 
    330 N.C. 314
    , 322, 
    411 S.E.2d 133
    , 138 (1991) (citing Kelly v. Int’l Harvester Co., 
    278 N.C. 153
    , 
    179 S.E.2d 396
    (1971)).
    In determining the sufficiency of the evidence to withstand
    a motion for a directed verdict, all of the evidence which
    supports the non-movant’s claim must be taken as true and
    considered in the light most favorable to the non-movant,
    giving the non-movant the benefit of every reasonable
    inference which may legitimately be drawn therefrom and
    resolving contradictions, conflicts, and inconsistencies in
    the non-movant’s favor.
    Turner v. Duke Univ., 
    325 N.C. 152
    , 158, 
    381 S.E.2d 706
    , 710 (1989).
    “[U]nder [N.C. Gen. Stat.] § 115C–431(c), a school board must present evidence
    of (1) the amount of money it needs to maintain its school system, and (2) the amount
    it needs from the county in order to have the necessary amount.” Duplin Cnty. Bd.
    of Educ. v. Duplin Cnty. Bd. of Cnty. Comm’rs, 
    201 N.C. App. 113
    , 122, 
    686 S.E.2d 169
    , 174 (2009). As the Court made clear in Beaufort, the amount of money “needed”
    22
    UNION COUNTY BOARD OF EDUCATION V. UNION COUNTY BOARD OF COMMISSIONERS
    Opinion of the Court
    or “necessary” is that amount “legally necessary” to support a system of free public
    schools. 363 N.C. at 
    507, 681 S.E.2d at 283
    .
    In the present case, defendant argues “[plaintiff] failed to meet its basic burden
    of proof to show what amount was legally necessary to maintain a system of free
    public schools, and, thus, in turn failed to show how [defendant’s] funding fell short
    of the legally necessary level.” Defendant asserts plaintiff “simply failed to present
    evidence on the annual cost of providing a county-wide system of education both as
    to capital and current expenditures.”
    Upon a review of the evidence, we disagree. Specifically, plaintiff presented
    evidence tending to show current expense funding was needed to meet state
    mandates and policies and capital outlay funding was needed to maintain and repair
    school facilities. However, having determined above that much of plaintiff’s evidence
    was outside the scope of plaintiff’s proposed budget for the 2013-2014 fiscal year and
    should not have been admitted into evidence at trial, we remand for a new trial; it is
    too difficult to distinguish what evidence in the weeks long trial was within the scope
    of plaintiff’s proposed budget.
    4.      Jury Instructions
    In the final issue on appeal, defendant contends the trial court erred in issuing
    a broad rather than restrictive definition of the amount of money legally necessary to
    maintain a system of free public schools. Specifically, defendant argues the trial court
    23
    UNION COUNTY BOARD OF EDUCATION V. UNION COUNTY BOARD OF COMMISSIONERS
    Opinion of the Court
    erred by failing to issue requested instructions limiting the jury’s consideration to the
    proposed budget for the 2013-2014 fiscal year and by instructing the jury that
    students performing below grade level were not obtaining a sound basic education.
    Because similar jury instructions are likely to be issued on retrial, we address
    defendant’s arguments.
    On appeal, this Court considers a jury charge
    contextually and in its entirety. The charge will be held to
    be sufficient if it presents the law of the case in such
    manner as to leave no reasonable cause to believe the jury
    was misled or misinformed. The party asserting error
    bears the burden of showing that the jury was misled or
    that the verdict was affected by an omitted instruction.
    Under such a standard of review, it is not enough for the
    appealing party to show that error occurred in the jury
    instructions; rather, it must be demonstrated that such
    error was likely, in light of the entire charge, to mislead the
    jury.
    Hammel v. USF Dugan, Inc., 
    178 N.C. App. 344
    , 347, 
    631 S.E.2d 174
    , 177 (2006)
    (citations and quotation marks omitted).
    Defendant first argues the trial court erred by not instructing the jury to limit
    its consideration to those amounts plaintiff requested in its proposed budget for the
    2013-2014 fiscal year. We disagree.
    A review of the trial court’s instructions to the jury reveals that the
    instructions closely followed the language of N.C. Gen. Stat. § 115C-431 and were not
    overly broad. In fact, the trial court included language directing the jury to consider
    “the budgetary request of [plaintiff,]” among other factors provided in N.C. Gen. Stat.
    24
    UNION COUNTY BOARD OF EDUCATION V. UNION COUNTY BOARD OF COMMISSIONERS
    Opinion of the Court
    § 115C-431(c). We hold these instructions were sufficient to present the law to the
    jury, and had the trial court properly limited the evidence to the scope of plaintiff’s
    proposed budget, plaintiff’s requested instruction would have been unnecessary.
    Defendant also argues the trial court misled the jury when it misinterpreted
    the elements of a sound basic education set forth in Leandro v. State of North
    Carolina, 
    346 N.C. 336
    , 
    488 S.E.2d 249
    (1997), and Hoke Cnty. Bd. of Educ. v. State
    of North Carolina, 
    358 N.C. 605
    , 
    599 S.E.2d 365
    (2004). Specifically, defendant takes
    issue with the following instructions:
    The North Carolina Constitution provides every
    child the constitutional right to a sound basic
    education . . . .
    A student who is performing below grade level . . . is
    not obtaining a sound basic education in the subject matter
    being tested. A student who is performing at grade level or
    above . . . is obtaining a sound basic education . . . .
    Defendant argues these instructions misled the jury to believe that “students were
    only being provided a sound basic education if they were performing at grade level,
    suggesting if any student was not so performing, [Union County] was not providing
    a sound basic education and, thus, failing to provide a system of free public schools.”
    Upon review, we agree that this portion of the trial court’s instructions likely
    misled the jury and was error.           School funding cannot guarantee student
    performance; but only the opportunity for students to receive a sound basic education.
    That is why in Leandro, our Supreme Court expressly rejected the notion that our
    25
    UNION COUNTY BOARD OF EDUCATION V. UNION COUNTY BOARD OF COMMISSIONERS
    Opinion of the Court
    constitution provides every child the right to a sound basic education, noting
    “[s]ubstantial problems have been experienced in those states in which the courts
    have held that the state constitution guaranteed the right to a sound basic
    education[]” and “the framers of our Constitution did not intend to set such an
    impractical or unattainable 
    goal.” 346 N.C. at 350-51
    , 488 S.E.2d at 257. Instead,
    the Court held “Article IX, Section 2(1) of the North Carolina Constitution requires
    that all children have the opportunity for a sound basic education . . . .” Id at 
    351, 488 S.E.2d at 257
    (emphasis added).
    III.   Conclusion
    Having determined the budget dispute resolution process outlined in N.C. Gen.
    Stat. § 115C-431 concerns plaintiff’s proposed budget for the 2013-2014 fiscal year,
    we hold the trial court erred in allowing evidence outside the scope of the proposed
    budget for the 2013-2014 fiscal year into evidence and remand for a new trial.
    NEW TRIAL.
    Judges CALABRIA and STROUD concur.
    26