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Palmer v. Duke Power Co.

May 19, 1998


Appeal by defendants and cross-appeal by plaintiff from order entered 22 November 1996 and judgment entered 25 November 1996 by Judge Julius A. Rousseau in Wilkes County Superior Court. Heard in the Court of Appeals 24 February 1998.

The opinion of the court was delivered by: Timmons-goodson, Judge.

This action arises out of a motor vehicle collision, wherein plaintiff Raymond R. Palmer was injured when defendant Duke Power Company's truck, driven by defendant Ralph Douglas Shelton, Jr., rear- ended plaintiff's vehicle. Plaintiff subsequently filed this action seeking damages for personal injuries in Mecklenburg County Superior Court. Upon defendants' motion for change of venue, the action was transferred to Wilkes County Superior Court.

Prior to trial, the parties agreed to final and binding arbitration in this matter, and thereafter, the parties entered into a written arbitration agreement. Therein, the parties stated that the arbitrator's award would be final and binding and that any party could enforce the arbitrator's award pursuant to section 1-567.15 of the North Carolina General Statutes.

This matter was arbitrated before retired Superior Court Judge Robert A. Collier on 2 July 1996. The parties called witnesses and introduced documents into evidence. By arbitration award entered 20 July 1996, Judge Collier awarded plaintiff $221,000.00, to be paid within 30 days of the entry of the award.

Defendants filed a motion to vacate the arbitration award on 30 August 1996. Plaintiff filed a motion to confirm the award and grant judgment, including prejudgment interest on 4 September 1996. Thereafter, on 8 November 1996, plaintiff filed a motion to dismiss defendants' motion to vacate for lack of subject matter jurisdiction, based upon defendants' failure to properly serve plaintiff with their motion to vacate pursuant to section 1-567.16 of the General Statutes.

Both parties' motions came on for hearing before Judge Julius A. Rousseau, Jr. during the 18 November 1996 civil session of Wilkes County Superior Court. After hearing the arguments and reviewing the evidence of both parties, Judge Rousseau entered an order on 22 November 1996 granting plaintiff's motion to confirm the arbitration award, denying defendants' motion to vacate that award, and denying plaintiff's motion to dismiss defendants' motion to vacate the award. Further, by judgment entered 25 November 1996, Judge Rousseau awarded plaintiff the sum of $221,000.00, along with costs, but excluding prejudgment interest. Plaintiff and defendants appeal.

I. Defendants' Appeal

At the outset, we summarily deny plaintiff's motion to dismiss defendants' appeal for lack of subject matter jurisdiction for the following reasons: (1) the agreement that an arbitration will be final and binding does not in any way rob a party of the ability to apply for vacation of an award, or the right to appeal the trial court's denial of a motion to vacate; (2) although section 1-567.16 of our General Statues requires that service be made by registered mail or certified mail return receipt requested, and this Court has held that strict compliance with this service requirement is necessary, plaintiff can show no real prejudice in the manner in which service was finally accomplished, because he did receive prompt notice through first class mail; and (3) plaintiff cannot cite, nor can we discern, any authority that this failure on defendants' part somehow robs this Court of subject matter jurisdiction. We, therefore, move to the merits of defendants' appeal.

On appeal, defendants brings forth three assignments of error by which they argue that the trial court erred in confirming and not vacating the arbitration award. Defendants base their arguments upon plaintiff's failure to produce certain documents requested by defendants during discovery. For the reasons discussed herein, we find defendants' arguments to be unpersuasive, and accordingly, affirm the order and judgment of the court confirming the arbitration award.

North Carolina public policy favors settling disputes by arbitration. Prime S. Homes, Inc. v. Byrd, 102 N.C. App. 255, 401 S.E.2d 822 (1991). The arbitration process in North Carolina is governed by N.C. Gen. Stat. § 1-567.1, et seq. (1996)(the Uniform Arbitration Act). "Read in its entirety, the Uniform Arbitration Act appears to create a system of problem resolution with minimal judicial intervention. The ACT provides a means by which parties can agree contractually to limit judicial intervention into their disputes." Henderson v. Herman, 104 N.C. App. 482, 485, 409 S.E.2d 739, 740 (1991), cert. denied, 330 N.C. 851, 413 S.E.2d 551 (1992). Accordingly, discovery during the arbitration process is "designed to be minimal and informal, and is optimally far less extensive than discovery under traditional litigation." David M. Brodsky, ALI-ABA Course of Study, ADR Discovery Techniques, C566 ALI-ABA 219, 221 (1990). Significantly, the North Carolina Rules of Civil Procedure do not apply to arbitrations, unless incorporated into the arbitration agreement. Moreover, unless the parties specifically agree on a method of discovery in an arbitration proceeding, section 1-567.8 will govern the discovery process. See N.C. Gen. Stat. § 1-567.8 (1996). Section 1-567.8 provides in pertinent part:

(a) The arbitrators may issue subpoenas for the attendance of witnesses and for the production of books, records, documents and other evidence, and shall have the power to administer oaths. . . .

(b) On application of a party and for use as evidence, the arbitrators may permit a deposition to be taken, in the manner and upon the terms designated by the arbitrators, of a witness who cannot be subpoenaed or is unable to attend the hearing.

(c) All provisions of law compelling a person under subpoena to testify are applicable.

N.C. G.S. § 1-567.8. In Prime S. Homes, this Court noted, "contrary to a civil case at law, where there exists a broad right to discovery, see G.S. § 1A-1, Rules 26 to 37, discovery during arbitration is at the ...

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