{ "id": 8527905, "name": "J. M. OWEN BUILDING CONTRACTORS, INC., Plaintiff v. COLLEGE WALK, LTD., a North Carolina Limited Partnership and COMMERCE CONSTRUCTION CO., INC., a Tennessee Corporation, Defendants; and COMMERCE CONSTRUCTION CO., INC., Third-Party Plaintiff v. BALBOA INSURANCE COMPANY, Third-Party Defendant, and COLLEGE WALK, LTD., Third-Party Plaintiff v. RELIANCE INSURANCE COMPANY, Third-Party Defendant", "name_abbreviation": "J. M. Owen Building Contractors, Inc. v. College Walk, Ltd.", "decision_date": "1991-02-05", "docket_number": "No. 9029SC334", "first_page": "483", "last_page": "490", "citations": [ { "type": "official", "cite": "101 N.C. App. 483" } ], "court": { "name_abbreviation": "N.C. Ct. App.", "id": 14983, "name": "North Carolina Court of Appeals" }, "jurisdiction": { "id": 5, "name_long": "North Carolina", "name": "N.C." }, "cites_to": [ { "cite": "371 S.E.2d 285", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 1988, "opinion_index": 0 }, { "cite": "322 N.C. 838", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 2514468, 2517295, 2518674, 2517460, 2515999 ], "year": 1988, "opinion_index": 0, "case_paths": [ "/nc/322/0838-02", "/nc/322/0838-03", "/nc/322/0838-01", "/nc/322/0838-04", "/nc/322/0838-05" ] }, { "cite": "362 S.E.2d 615", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 1987, "opinion_index": 0 }, { "cite": "88 N.C. App. 88", "category": "reporters:state", "reporter": "N.C. App.", "case_ids": [ 8357820 ], "year": 1987, "opinion_index": 0, "case_paths": [ "/nc-app/88/0088-01" ] }, { "cite": "361 S.E.2d 75", "category": "reporters:state_regional", "reporter": "S.E.2d", "weight": 2, "year": 1987, "opinion_index": 0 }, { "cite": "320 N.C. 798", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 4726403, 4731173, 4724745, 4725229, 4724083 ], "year": 1987, "opinion_index": 0, "case_paths": [ "/nc/320/0798-02", "/nc/320/0798-03", "/nc/320/0798-05", "/nc/320/0798-01", "/nc/320/0798-04" ] }, { "cite": "355 S.E.2d 815", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 1987, "opinion_index": 0 }, { "cite": "85 N.C. App. 684", "category": "reporters:state", "reporter": "N.C. App.", "case_ids": [ 12170280 ], "year": 1987, "opinion_index": 0, "case_paths": [ "/nc-app/85/0684-01" ] }, { "cite": "341 S.E.2d 74", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 1986, "pin_cites": [ { "page": "75" } ], "opinion_index": 0 }, { "cite": "80 N.C. App. 157", "category": "reporters:state", "reporter": "N.C. App.", "case_ids": [ 8522374 ], "year": 1986, "pin_cites": [ { "page": "159" } ], "opinion_index": 0, "case_paths": [ "/nc-app/80/0157-01" ] }, { "cite": "293 S.E.2d 793", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 1982, "opinion_index": 0 }, { "cite": "306 N.C. 518", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 8571437 ], "year": 1982, "opinion_index": 0, "case_paths": [ "/nc/306/0518-01" ] }, { "cite": "276 S.E.2d 743", "category": "reporters:state_regional", "reporter": "S.E.2d", "weight": 2, "year": 1981, "pin_cites": [ { "page": "744" } ], "opinion_index": 0 }, { "cite": "51 N.C. App. 350", "category": "reporters:state", "reporter": "N.C. App.", "case_ids": [ 2645825 ], "year": 1981, "pin_cites": [ { "page": "352" } ], "opinion_index": 0, "case_paths": [ "/nc-app/51/0350-01" ] } ], "analysis": { "cardinality": 633, "char_count": 15612, "ocr_confidence": 0.775, "pagerank": { "raw": 1.738710804373915e-07, "percentile": 0.7067002748036662 }, "sha256": "b1e3baae001f4036e487017807306f5ecd96b5574af3d5ae37a769c79ff2470c", "simhash": "1:ee6bc9ae0ad45564", "word_count": 2533 }, "last_updated": "2023-07-14T19:54:53.681770+00:00", "provenance": { "date_added": "2019-08-29", "source": "Harvard", "batch": "2018" }, "casebody": { "judges": [ "Judges Eagles and Parker concur." ], "parties": [ "J. M. OWEN BUILDING CONTRACTORS, INC., Plaintiff v. COLLEGE WALK, LTD., a North Carolina Limited Partnership and COMMERCE CONSTRUCTION CO., INC., a Tennessee Corporation, Defendants, and COMMERCE CONSTRUCTION CO., INC., Third-Party Plaintiff v. BALBOA INSURANCE COMPANY, Third-Party Defendant, and COLLEGE WALK, LTD., Third-Party Plaintiff v. RELIANCE INSURANCE COMPANY, Third-Party Defendant" ], "opinions": [ { "text": "JOHNSON, Judge.\nCommerce Construction Co., Inc. (\u201cCommerce\u201d) and J. M. Owen Building Contractors, Inc. (\u201cOwen\u201d) contracted for construction work on a certain adult community complex located in Transylvania County. The owner of the project is College Walk, Ltd. (\u201cCollege Walk\u201d). The project was composed of two principal parts, the Adult Congregate Living Facility (\u201cACLF\u201d) and the Cluster Homes. Commerce contracted with College Walk as the general contractor for the ACLF facility by a written contract dated 11 October 1985.\nOn 11 December 1985, Owen entered into a series of subcontracts with Commerce regarding construction and carpentry work to be performed on the ACLF facility. During 1985, 1986, and 1987, Owen entered into a series of contracts with College Walk regarding the construction of the Cluster Homes. Owen had a direct contract with College Walk as the general contractor for the Cluster Homes\u2019 portion of the project. According to their contractual agreement, Commerce and Owen obtained a surety for their work on the ACLF and Cluster Homes. Reliance was obtained as the surety by Commerce for the ACLF portion of the project. Balboa Insurance Company (\u201cBalboa\u201d) was the surety for Owen on the Cluster Homes. Reliance issued a Performance and Payment Bond in favor of College Walk on the ACLF construction. Reliance also issued a Labor and Material Payment Bond for the ACLF construction.\nOn 16 June 1987, Owen filed a Claim of Lien against Commerce and College Walk for labor and materials provided for the ACLF facility in the amount of $116,687.44. Owen subsequently filed Claims of Lien against College Walk for work performed and services provided for the Cluster Homes\u2019 portion of the project on 8 July 1987 in the amount of $58,736.45. Owen perfected the Claim of Lien filed against Commerce and College Walk on 24 September 1987. In its complaint, Owen alleged nonpayment of labor, materials, and overhead for the carpentry and construction work performed on the ACLF and the Cluster Homes.\nCollege Walk thereafter filed a Motion to Compel Arbitration on the dispute and moved to add Reliance as a party defendant. By order dated 23 March 1988, Reliance was added as a third-party defendant in the action.\nThe parties proceeded to arbitration through the American Arbitration Association and a hearing was conducted before a tribunal of arbitrators. On 12 April 1989, an Award of Arbitrators was rendered. The arbitrators determined that Commerce and Reliance should pay to College Walk $30,202.00 with interest at 8\u00b0/o per diem on the ACLF portion of the project. Commerce and Reliance were further ordered to pay College Walk\u2019s attorney\u2019s fees in the amount of $23,753.00 and to provide \u201cas-built\u201d mylars at no cost to College Walk. Commerce and Reliance were further ordered to pay Owen as the subcontractor on the ACLF portion of the project $116,687.00 with interest at 8% per diem. In addition, Commerce and Reliance were ordered to pay Owen\u2019s attorney\u2019s fees in filing its lien action.\nOn the Cluster Homes project, the arbitrators determined that Owen should pay to College Walk $30,570.00 with interest at 8\u00b0/o per diem and attorney\u2019s fees of $4,375.00. The arbitrators also determined that the lien funds deposited with the Transylvania County Clerk of Superior Court in the amount of $53,036.45 were to be released and awarded to College Walk.\nAfter the arbitrators\u2019 final decision, the parties made various motions to confirm or modify the arbitrators\u2019 award. All motions were heard on 23 October 1989. Owen, Commerce and Reliance argued that the interest stated in the arbitrators\u2019 award should be on a per annum basis rather than a per diem. Owen, Commerce and Reliance further argued that the arbitrators had no authority to award attorney\u2019s fees. College Walk, however, argued that the interest should remain as set out in the arbitrators\u2019 award and that the arbitrators did, in fact, have the authority to award attorney\u2019s fees.\nFor the most part, the arbitrators\u2019 award was confirmed by an order dated 1 November 1989. The trial court, however, struck the portion of the arbitrators\u2019 award granting attorney\u2019s fees and further ordered that all lien funds paid into the clerk of superior court be retained pending further orders.\nThe court on its own motion entered an order re-opening the issues of confirmation of the arbitrators\u2019 award with respect to the issues of the amount of interest awarded, attorney\u2019s fees and the amount of monies to be taken down pending any appeals from the judgment entered on 1 November 1989. After reviewing the record and considering arguments of counsel, the trial court entered an order reflecting the court\u2019s order of 1 November 1989 denying attorney\u2019s fees. The interest rate of 8% per diem was determined to be excessive and punitive and the trial court thereby substituted an interest rate of 8% per annum on the award made by the arbitrators. All funds deposited with the clerk of superior court were ordered retained pending appeal.\nOn appeal, defendant College Walk brings forth six questions for this Court\u2019s review and third-party defendant Reliance brings forth an additional two questions for review. Third-party plaintiff Commerce, however, has not advanced any arguments and therefore has abandoned its entire appeal. See Rule 28 of the N.C. Rules of Appellate Procedure. For the sake of clarity, we will first address the questions brought forth by College Walk.\nCollege Walk\u2019s Appeal\nBy Assignments of Error numbers one and two, College Walk contends that the motions made by Commerce and Reliance to vacate or modify the award of arbitrators were untimely and therefore improperly accepted by the trial court. We disagree.\n\u201cThe purpose of arbitration is to reach a final settlement of disputed matters without litigation, and it is well established that the parties, who have agreed to abide by the decision of a panel of arbitrators, will not generally be heard to attack the regularity or fairness of an award.\u201d Thomas v. Howard, 51 N.C. App. 350, 352, 276 S.E.2d 743, 744 (1981). An award is ordinarily presumed to be valid and the party trying to set aside the award has the burden of demonstrating an objective basis which supports his allegation that one of the arbitrators acted improperly. Id. College Walk has not met this burden.\nGeneral Statutes \u00a7 1-567.13 provides the exclusive grounds and procedure for vacating an award while G.S. \u00a7 1-567.14 provides the exclusive grounds and procedure for modifying or correcting an award. Crutchley v. Crutchley, 306 N.C. 518, 293 S.E.2d 793 (1982). Both statutory provisions establish that an application for vacating or modifying an award must be made within 90 days after delivery of a copy of the award to the applicant. See G.S. \u00a7\u00a7 1-567.13(b) and l-567.14(a). Service of the award must be by either personal delivery or registered mail. G.S. \u00a7 1-567.9. Where, as here, \u201ca statute prescribes a specific mode of notice that method must be strictly followed where notice must be relied upon to divest the recipient of a right.\u201d Council v. Balfour Products Group, 80 N.C. App. 157, 159, 341 S.E.2d 74, 75 (1986). As we firmly believe that G.S. \u00a7 1-567.9 is a prerequisite to the vacating or modifying of the arbitrators\u2019 award, service of the Award of Arbitrators, in the instant case, by regular mail did not commence the running of the 90-day period as prescribed by G.S. \u00a7 1-567.13. Therefore, we hold that neither Commerce nor Reliance were furnished with the applicable statutory notice. Thus, the trial court properly considered the issues of the interest rate and attorney\u2019s fees. Accordingly, we overrule College Walk\u2019s first two Assignments of Error.\nNext, College Walk contends that the trial court erred by deleting the arbitrators\u2019 award of attorney\u2019s fees. We disagree.\nInitially, we note that attorney\u2019s fees are not a subject of arbitration even if the contract in dispute provides for such fees. Wilson Building Co. v. Thorneburg Hosiery Co., Inc., 85 N.C. App. 684, 355 S.E.2d 815, cert. denied, 320 N.C. 798, 361 S.E.2d 75 (1987). G.S. \u00a7 1-567.11 excludes attorney\u2019s fees from an award to be rendered by the arbitrators since such fees are only collectible under G.S. \u00a7 6-21.2. The Award of Arbitration in the instant case specifically awarded attorney\u2019s fees to both College Walk and Owen. Such an award, however, exceeded the arbitrators\u2019 authority. Id. Therefore, the trial court properly denied College Walk\u2019s motion to confirm the arbitrators\u2019 award.\nBy Assignment of Error number five, College Walk contends that the trial court erred in modifying the arbitrators\u2019 award by substituting 8% per annum for the awarded amount of 8% per diem. We disagree.\nGeneral Statutes \u00a7 l-567.14(a) provides that\n(a) Upon application made within 90 days after delivery of a copy of the award to the applicant, the court shall modify or correct the award where:\n(1) There was an evident miscalculation of figures or an evident mistake in the description of any person, thing or property referred to in the award.\n(2) The arbitrators have awarded upon a matter not substituted to them and the award may be corrected without affecting the merits of the decision upon the issues submitted; or\n(3) The award is imperfect in a matter of form, not affecting the merits of the controversy.\nAn award is conclusive on matters of law and fact if decided in accordance with the legal construction of the contract in which the arbitrators derive their authority. 5 Am. Jur. 2d, Arbitration and Award, \u00a7 147 (1962).\nWhile we recognize that the public policy of our State favors confirmation of arbitration awards, we also recognize that such awards are not infallible. Wildwoods of Lake Johnson Assoc. v. L. P. Cox Company, 88 N.C. App. 88, 362 S.E.2d 615 (1987), disc. rev. denied, 322 N.C. 838, 371 S.E.2d 285 (1988). The contract between College Walk and Commerce for the ACLF portion of the project mentioned applicable interest rates in two specific provisions. Through each provision, the parties agreed that the rate of interest governing the contract was that of the legal rate at the place of the project. We find that the arbitrators\u2019 decision to award interest at 8% per diem is inconsistent with the parties\u2019 contract.\nFinally, College Walk contends that the trial court erred in denying its motion to release all monies held by the Transylvania County Clerk of Superior Court. College Walk\u2019s appeal of the entire arbitration award placed all funds, including approximately $158,000.00 deposited with the clerk of court, at issue. Thus, the trial court correctly ordered that these funds remain with the clerk of court pending appeal. This assignment is overruled.\nReliance\u2019s Appeal\nBy Assignment of Error number one, Reliance contends that the trial court erred in confirming the award of interest on the arbitrators\u2019 award at the rate of 8\u00b0/o per diem.\nInitially, we note that Reliance filed notice of appeal from the 1 November 1989 order on 30 November 1989. The trial court in its 1 November 1989 order did not substitute the 8% per annum for the previously awarded 8% per diem. Such modification did not occur until the 4 December 1989 order. While Reliance filed an appeal from the first order, it did not file an appeal from the second order which resulted in the substitution of 8% per annum for the arbitrators\u2019 award of 8% per diem. The arguments brought forth by Reliance, however, are premised upon the trial court\u2019s order dated 4 December 1989. Pursuant to Rule 28 of the N.C. Rules of Appellate Procedure, any appeal by Reliance from the order dated 4 December 1989 has therefore been abandoned. (Inasmuch as Reliance\u2019s threshold issue is identical to the fifth question raised by College Walk\u2019s appeal, the substance of this issue, though abandoned by Reliance, has already been addressed. See discussion under the fifth issue of College Walk\u2019s appeal.)\nWe have considered the second issue raised by Reliance on appeal, but find it to be without merit. It is therefore overruled.\nAccordingly, the order of the trial court eliminating attorney\u2019s fees and substituting an interest rate of 8% per annum for the 8% per diem is\nAffirmed.\nJudges Eagles and Parker concur.", "type": "majority", "author": "JOHNSON, Judge." } ], "attorneys": [ "Long, Parker, Hunt, Payne & Warren, P.A., by Jeffrey P. Hunt, for plaintiff-appellee.", "Safran Law Offices, by Perry R. Safran and V. A. Anderson, Jr., for defendant-appellant College Walk.", "Roberts Stevens & Cogbum, P.A., by Gregory D. Hutchins and William Clarke, for third-party defendant-appellant Reliance Insurance Company." ], "corrections": "", "head_matter": "J. M. OWEN BUILDING CONTRACTORS, INC., Plaintiff v. COLLEGE WALK, LTD., a North Carolina Limited Partnership and COMMERCE CONSTRUCTION CO., INC., a Tennessee Corporation, Defendants, and COMMERCE CONSTRUCTION CO., INC., Third-Party Plaintiff v. BALBOA INSURANCE COMPANY, Third-Party Defendant, and COLLEGE WALK, LTD., Third-Party Plaintiff v. RELIANCE INSURANCE COMPANY, Third-Party Defendant\nNo. 9029SC334\n(Filed 5 February 1991)\n1. Arbitration and Award \u00a7 40 (NCI4th)\u2014 motion to vacate award \u2014 timeliness\nThere was no merit to College Walk\u2019s contention that motions by two defendants to vacate or modify an award of arbitrators were untimely and therefore improperly accepted by the trial court, since service of the award of arbitrators was by regular mail; N.C.G.S. \u00a7 1-567.9 requires that service of the award must be by personal delivery or registered mail; and service by regular mail therefore did not commence the running of the 90-day period allowed for motions to vacate or modify an award. N.C.G.S. \u00a7\u00a7 l-567.13(b) and l-567.14(a).\nAm Jur 2d, Arbitration and Award \u00a7\u00a7 145, 184, 185.\n2. Arbitration and Award \u00a7 34 (NCI4th)\u2014 attorney\u2019s fees\u2014 arbitrators\u2019 award properly deleted\nThe trial court did not err by deleting an arbitrators\u2019 award of attorney\u2019s fees, since attorney\u2019s fees are not a subject of arbitration even if the contract in dispute provides for such fees, as N.C.G.S. \u00a7 1-567.11 excludes attorney\u2019s fees from an award to be rendered by the arbitrators since such fees are only collectible under N.C.G.S. \u00a7 6-21.2.\nAm Jur 2d, Arbitration and Award \u00a7\u00a7 136, 137.\n3. Arbitration and Award \u00a7 42 (NCI4th)\u2014 interest awarded per diem \u2014modification to per annum\nThe trial court did not err in modifying an arbitrators\u2019 award by substituting interest of 8% per annum for the awarded amount of 8\u00b0/o per diem, since the arbitrators\u2019 decision was inconsistent with the parties\u2019 contract.\nAm Jur 2d, Arbitration and Award \u00a7 139.7.\n4. Arbitration and Award \u00a7 43 (NCI4th)\u2014 appeal of award\u2014 monies held by clerk of court \u2014 motion to release properly denied\nThe trial court did not err in denying College Walk\u2019s motion to release all monies held by the clerk of superior court, since College Walk\u2019s appeal of the entire arbitration award placed all funds, including the approximately $158,000 deposited with the clerk of court, at issue.\nAm Jur 2d, Arbitration and Award \u00a7 145.\nAppeal by defendant College Walk, Ltd., third-party plaintiff Commerce Construction Co., Inc. and third-party defendant Reliance Insurance Company from order entered 1 November 1989 by Judge Robert E. Gaines in TRANSYLVANIA County Superior Court. Heard in the Court of Appeals 23 October 1990.\nPlaintiff instituted a civil action against defendants for breach of contracts, unjust enrichment, enforcement of lien rights, unfair trade practices and attorney\u2019s fees. This action was subsequently referred to arbitration. With some modifications, the trial court confirmed the arbitrator\u2019s award. Defendant, third-party plaintiff and third-party defendant appeal.\nLong, Parker, Hunt, Payne & Warren, P.A., by Jeffrey P. Hunt, for plaintiff-appellee.\nSafran Law Offices, by Perry R. Safran and V. A. Anderson, Jr., for defendant-appellant College Walk.\nRoberts Stevens & Cogbum, P.A., by Gregory D. Hutchins and William Clarke, for third-party defendant-appellant Reliance Insurance Company." }, "file_name": "0483-01", "first_page_order": 511, "last_page_order": 518 }