{
  "id": 2550326,
  "name": "NUCOR CORPORATION v. GENERAL BEARING CORPORATION",
  "name_abbreviation": "Nucor Corp. v. General Bearing Corp.",
  "decision_date": "1992-12-18",
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    "parties": [
      "NUCOR CORPORATION v. GENERAL BEARING CORPORATION"
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    "opinions": [
      {
        "text": "LAKE, Justice.\nThis case arises out of an arbitration proceeding pursuant to North Carolina\u2019s codification of the Uniform Arbitration Act, specifically N.C.G.S. \u00a7 1-567.1 to .19. The essential question raised is whether our Arbitration Act, or our general law, permits an arbitration award, duly made under the Act, to be expanded by the court of jurisdiction on confirmation to include attorneys\u2019 fees for work conducted in the arbitration proceeding. The answer requires analysis of the several sections of our Arbitration Act and a comparison of the specific language of N.C.G.S. \u00a7 1-567.11 with the general statutory authority allowing the award of attorneys\u2019 fees under certain contractual arrangements as provided in N.C.G.S. \u00a7 6-21.2. As such, this case, in essence, presents to this Court an issue of first impression.\nOn or about 1 December 1986, General Bearing Corporation (General Bearing) entered into a Stock Purchase Agreement with Nucor Corporation (Nucor) under the terms of which Nucor agreed to purchase from General Bearing all of the outstanding stock of General Bearing\u2019s subsidiary, Genbearco Manufacturing Company, Inc., located in Wilson, North Carolina. Nucor is a manufacturer of steel and steel fabricated products, with its corporate headquarters in Charlotte, North Carolina. General Bearing is a manufacturer of bearings, with its corporate headquarters in Blauvelt, New York. The Agreement obligated General Bearing to pay Nucor the value of Genbearco\u2019s obsolete inventory and to pay any deficiency in the warranted net worth of Genbearco. The Agreement also required General Bearing to secure its various obligations by an irrevocable letter of credit in the amount of $1,500,000 and to put $1,000,000 of the purchase money received in escrow pending its full performance.\nSection 23 of the Stock Purchase Agreement provided for the submission to arbitration of any dispute arising in connection with the Agreement. The Agreement further provided that choice of law governing would be the laws of North Carolina and that expenses of arbitration would be divided equally between the parties. Section 9 of the Agreement, captioned \u201cIndemnification,\u201d provides for reasonable attorneys\u2019 fees under certain conditions to each of the parties, but only with respect to indemnification for liabilities incurred to third parties. This is the only section in the Agreement which refers to attorneys\u2019 fees.\nIn 1989, General Bearing defaulted and Nucor requested arbitration hearings. Upon General Bearing\u2019s refusal, Nucor filed a complaint in Superior Court, Mecklenburg County seeking to compel arbitration. The superior court ruled by order dated 31 August 1989 that the provision in the Agreement providing for arbitration of disputes arising under the Agreement was valid and enforceable and that Nucor was entitled to invoke the aid of the court to enforce such arbitration provision. The superior court ordered that arbitration commence in accordance with the provisions of the Arbitration Act and the court retained jurisdiction of the action to rule on any motions, including a motion to confirm the arbitration award, pursuant to N.C.G.S. \u00a7 1-567.12.\nOn 16 February 1990, the arbitration panel rendered a decision awarding Nucor $1,537,690 for the breach by General Bearing of its obligations to Nucor under the Agreement. The arbitration panel declined to award General Bearing any amount under its counterclaim and further declined to award either party attorneys\u2019 fees, noting that although the Stock Purchase Agreement provided for the recovery of legal fees under certain circumstances, the panel \u201cbelieves that it has no authority to award legal fees.\u201d Nucor then filed a motion in the Superior Court, Mecklenburg County to confirm the arbitration panel\u2019s award and to award attorneys\u2019 fees pursuant to N.C.G.S. \u00a7 6-21.2. The superior court by Order dated 27 April 1990 affirmed the panel\u2019s award, and, in addition, awarded Nucor attorneys\u2019 fees of fifteen percent of the balance that General Bearing owed under the Agreement ($230,653.50), pursuant to N.C.G.S. \u00a7 6-21.2.\nGeneral Bearing appealed the additional award of attorneys\u2019 fees to the Court of Appeals which upheld the award in an opinion filed 16 July 1991. The Court of Appeals ruled that the trial court properly followed the statutory mandate of N.C.G.S. \u00a7 6-21.2(2) in awarding attorneys\u2019 fees to Nucor of fifteen percent of the outstanding balance owed by General Bearing under the Agreement. General Bearing filed a petition for discretionary review which was allowed by order of this Court on 5 December 1991.\nI.\nIn General Bearing\u2019s first assignment of error it contends that the superior court violated North Carolina\u2019s Arbitration Act, specifically N.C.G.S. \u00a7 1-567.11, and public policy by awarding attorneys\u2019 fees. In its second assignment of error it also argues that the superior court lacked the power to change the arbitrators\u2019 award by adding attorneys\u2019 fees not contained in the award. We agree with General Bearing on both assignments of error. The arbitration panel was correct in declining to award attorneys\u2019 fees, and in its observation that in this case \u201cit has no authority to award legal fees.\u201d\nThe parties hereto agreed, within the Stock Purchase Agreement, to settle any dispute thereunder by arbitration. Section 23, captioned \u201cArbitration,\u201d provides in relevant part: \u201cUpon the request of either Seller or Purchaser, a dispute arising in connection with this Agreement shall be submitted to arbitration----Expenses of arbitration shall be divided equally between the parties. In the event of arbitration, the arbitrator(s) shall pass finally upon all questions, both of law and fact, and his (their) findings shall be conclusive.\u201d In so agreeing, to place any dispute into arbitration, the parties as well as the arbitration panel, were thence bound by the terms of \u201cthe agreement to arbitrate\u201d and by the Uniform Arbitration Act codified in our statutes as N.C.G.S. Chapter 1, Article 45A.\nOnly one section within the Act refers to attorneys\u2019 fees, and that section provides: \u201cUnless otherwise provided in the agreement to arbitrate, the arbitrators\u2019 expenses and fees, together with other expenses, not including counsel fees, incurred in the conduct of the arbitration, shall be paid as provided in the award.\u201d N.C.G.S. \u00a7 1-567.11 (1983) (emphasis added). The relevant statute within the Act thus specifically prohibits arbitrators from awarding attorneys\u2019 fees unless \u201cthe agreement to arbitrate\u201d which compelled the parties to arbitration says otherwise.\nIn this regard, Nucor understandably argues it is permissible and appropriate to go outside the arbitration section (23) to encompass the entire Stock Purchase Agreement for purposes of showing the \u201cagreement to arbitrate\u201d does provide otherwise and allows for an award of attorneys\u2019 fees, albeit pursuant to N.C.G.S. \u00a7 6-21.2 rather than the Arbitration Act. As above noted, the only mention of attorneys\u2019 fees in the entire Stock Purchase Agreement is under Section 9 which deals solely with indemnification of either party in the event of incurred liability or obligation to a third party. \u201cIn indemnity contracts the engagement is to make good and save another harmless from loss on some obligation which he has incurred or is about to incur to a third party . . . .\u201d Casualty Co. v. Waller, 233 N.C. 536, 537, 64 S.E.2d 826, 827 (1951), quoted in Dixie Container Corp. v. Dale, 273 N.C. 624, 628, 160 S.E.2d 708, 711 (1968). We therefore cannot agree with Nucor that this sole reference to attorneys\u2019 fees, within the entire Stock Purchase Agreement, taken in its context, is sufficient to show that the parties\u2019 \u201cagreement to arbitrate\u201d does provide otherwise in negating the prohibition and exclusion of counsel fees contained in N.C.G.S. \u00a7 1-567.11.\nFurther, in this regard, we find that the Arbitration Act itself is most instructive on what properly constitutes \u201cthe agreement to arbitrate\u201d in making the determination of whether the parties in fact otherwise agreed to include counsel fees incident to the arbitration in the award along with \u201cother expenses.\u201d N.C.G.S. \u00a7 l-567.2(a) provides:\nTwo or more parties may agree in writing to submit to arbitration any controversy existing between them at the time of the agreement, or they may include in a written contract a provision for the settlement by arbitration of any controversy thereafter arising between them relating to such contract or the failure or refusal to perform the whole or any part thereof. Such agreement or provision shall be valid, enforceable, and irrevocable except with the consent of all the parties, without regard to the justiciable character of the controversy.\nN.C.G.S. \u00a7 l-567.2(a) (1983) (emphasis added). See Crutchley v. Crutchley, 306 N.C. 518, 522, 293 S.E.2d 793, 796 (1982). The wording of this section of the Act, as emphasized, relates precisely to the circumstances in the case sub judice and further demonstrates that \u201cthe agreement to arbitrate\u201d in this case does not include the entire Stock Purchase Agreement, but rather is confined to Section 23 thereof designated \u201cArbitration\u201d which contains exclusively the provisions relating to arbitration. Section 23, while providing for equal division of \u201cexpenses of arbitration,\u201d contains no reference whatever to attorneys\u2019 fees. Thus, \u201cthe agreement to arbitrate,\u201d in the instant case, does not \u201cotherwise provide\u201d for the inclusion of counsel fees, and such fees are not therefore allowable in the award under the express wording of N.C.G.S. \u00a7 1-567.11 for legal work performed in an arbitration proceeding.\nThe specific, uncomplicated language of N.C.G.S. \u00a7 1-567.11 clearly reflects the legislative intent that attorneys\u2019 fees are not to be awarded for work performed in arbitration proceedings, unless the parties specifically agree to and provide for such fees in the arbitration agreement. There are important policy considerations supporting this determination not to allow attorneys\u2019 fees in arbitration proceedings, unless provided by the parties. These considerations are consistent with the principle legislative purpose behind enactment of the Uniform Arbitration Act: to provide and encourage an expedited, efficient, relatively uncomplicated, alternative means of dispute resolution, with limited judicial intervention or participation, and without the primary expense of litigation \u2014 attorneys\u2019 fees. See Cyclone Roofing Co. v. LaFave Co., 312 N.C. 224, 236, 321 S.E.2d 872, 879 (1984); McNeal v. Black, 61 N.C. App. 305, 300 S.E.2d 575 (1983); Thomas v. Howard, 51 N.C. App. 350, 276 S.E.2d 743 (1981).\nThe reliance by Nucor, and heretofore our trial courts and the Court of Appeals, upon N.C.G.S. \u00a7 6-21.2 as authority for the proposition that attorneys\u2019 fees are awardable by the superior court for work performed in arbitration proceedings, when no agreement for such fees exists and such fees have not been allowed by the arbitrator in the award, is misplaced and is hereby disavowed. As above stated, such proposition is contrary to the specific wording of N.C.G.S. \u00a7 1-567.11 and to well settled principles of law including statutory construction. The law is well established in North Carolina that \u201cthe non-allowance of counsel fees has prevailed as the policy of this state at least since 1879\u201d and a \u201csuccessful litigant may not recover attorneys\u2019 fees, whether as costs or as an item of damages, unless such recovery is expressly authorized by statute.\u201d Enterprises, Inc. v. Equipment Co., 300 N.C. 286, 289, 266 S.E.2d 812, 814 (1980); Hicks v. Albertson, 284 N.C. 236, 200 S.E.2d 40 (1973). N.C.G.S. \u00a7 6-21.2 represents a substantial exception to that well-established rule. Trust Co. v. Schneider, 235 N.C. 446, 70 S.E.2d 578 (1952).\nAs an exception to the rule, N.C.G.S. \u00a7 6-21.2 generally relates to and concerns the subject of attorneys\u2019 fees for legal work performed in the collection of indebtedness under various contractual arrangements and, unlike N.C.G.S. \u00a7 1-567.11, does not specifically address or relate to the subject of arbitration or attorneys\u2019 fees for the resolution of contractual disputes through arbitration. The applicable rule of statutory construction here is that where one statute deals with a particular subject or situation in specific detail, while another statute deals with the subject in broad, general terms, the particular, specific statute will be construed as controlling, absent a clear legislative intent to the contrary. Merritt v. Edwards Ridge, 323 N.C. 330, 337, 372 S.E.2d 559, 563 (1988). \u201cWhere one of two statutes might apply to the same situation, the statute which deals more directly and specifically with the situation controls over the statute of more general applicability.\u201d Trustees of Rowan Tech. v. Hammond Assoc., 313 N.C. 230, 238, 328 S.E.2d 274, 279 (1985); Food Stores v. Board of Alcoholic Control, 268 N.C. 624, 151 S.E.2d 582 (1966).\nSince N.C.G.S. \u00a7 6-21.2 is a statute of general applicability while N.C.G.S. \u00a7 1-567.11 is a specific statute relating solely to arbitration, we hold that N.C.G.S. \u00a7 6-21.2 does not apply to arbitration proceedings. Thus, in arbitration proceedings, both the arbitrator or arbitration panel and the superior courts upon confirmation are limited to applying only N.C.G.S. \u00a7 1-567.11 in determining whether attorneys\u2019 fees should be or were properly awarded.\nIn addition to the foregoing principles, the Uniform Arbitration Act, which as enacted and codified in our statutory law is virtually a self-contained, self-sufficient code, further provides controlling limitations upon the authority of our courts to vacate, modify or correct an arbitration award. \u201cG.S. \u00a7\u00a7 1-567.13 and 1-567.14 provide the exclusive grounds and procedures for vacating, modifying, or correcting an award.\u201d Crutchley v. Crutchley, 306 N.C. 518, 523 n.2, 293 S.E.2d 793, 796 n.2 (emphasis added). N.C.G.S. \u00a7 1-567.12 provides: \u201cUpon application of a party, the court shall confirm an award, unless within the time limits hereinafter imposed grounds are urged for vacating or modifying or correcting the award, in which case the court shall proceed as provided in G.S. 1-567.13 and 1-567.14.\u201d N.C.G.S. \u00a7 1-567.12 (1983). N.C.G.S. \u00a7 1-567.14 (Modification or correction of award) provides in subsection (a) three specific instances where modification is allowed, none of which are applicable to attorneys\u2019 fees, and further provides in subsection (b): \u201cIf the application is granted, the court shall modify and correct the award so as to effect its intent and shall confirm the award as so modified and corrected. Otherwise, the court shall confirm the award as made.\" N.C.G.S. \u00a7 l-567.14(b) (1983) (emphasis added).\nThere is no provision or authority in this section or elsewhere in the Act allowing a court to increase an award by adding attorneys\u2019 fees not contained in the award. The superior court therefore erred in so doing in the instant case and such award must be reversed.\nII.\nWith regard to General Bearing\u2019s third and fourth assignments of error, since we have held that N.C.G.S. \u00a7 6-21.2 is not applicable in arbitration proceedings, we do not reach the issue of whether the Stock Purchase Agreement is an \u201cevidence of indebtedness\u201d thereunder, and we likewise do not reach the issue of reasonableness upon awarding attorneys\u2019 fees pursuant to N.C.G.S. \u00a7 6-21.2.\nAccordingly, the decision of the Court of Appeals is\nREVERSED.",
        "type": "majority",
        "author": "LAKE, Justice."
      }
    ],
    "attorneys": [
      "DeLaney and Sellers, P.A., by Ernest S. DeLaney III, for plaintiff-appellee.",
      "Kennedy Covington Lobdell & Hickman, by Raymond E. Owens, Jr. and Alice C. Richey, for defendant-appellant.",
      "Baer Marks & Upham, by Anthony De Toro, for defendant-appellant."
    ],
    "corrections": "",
    "head_matter": "NUCOR CORPORATION v. GENERAL BEARING CORPORATION\nNo. 378PA91\n(Filed 18 December 1992)\n1. Arbitration and Award \u00a7 34 (NCI4th)\u2014 agreement to arbitrate \u2014 no provision for counsel fees \u2014 arbitration counsel fees prohibited\nThe \u201cagreement to arbitrate\u201d did not include an entire stock purchase agreement but was confined to a section thereof captioned \u201cArbitration.\u201d Thus, where the arbitration section of the agreement contained no reference to counsel fees, the \u201cagreement to arbitrate\u201d did not \u201cotherwise provide\u201d for the inclusion of counsel fees in the arbitration award, and N.C.G.S. \u00a7 1-567.11 prohibited the award of counsel fees for work performed in the arbitration proceeding.\nAm Jur 2d, Arbitration and Award \u00a7\u00a7 6, 14, 139.\n2. Arbitration and Award \u00a7 34 (NCI4th)\u2014 arbitration counsel fees \u2014necessity for provision in arbitration agreement\nThe language of N.C.G.S. \u00a7 1-567.11 clearly reflects the legislative intent that counsel fees are not to be awarded for work performed in arbitration proceedings unless the parties specifically agree to and provide for such fees in the arbitration agreement.\nAm Jur 2d, Arbitration and Award \u00a7\u00a7 6, 139.\n3. Statutes \u00a7 5.8 (NCI3d)\u2014 general and specific statutes \u2014 control by specific statute\nWhere one statute deals with a particular subject or situation in specific detail, while another statute deals with the subject in broad, general terms, the particular, specific statute will be construed as controlling absent a clear legislative intent to the contrary.\nAm Jur 2d, Statutes \u00a7 257.\n4. Arbitration and Award \u00a7 34 (NCI4th)\u2014 arbitration counsel fees \u2014 applicable statute\nSince N.C.G.S. \u00a7 6-21.2 is a statute of general applicability while N.C.G.S. \u00a7 1-567.11 is a specific statute relating solely to arbitration, N.C.G.S. \u00a7 6-21.2 does not apply to arbitration proceedings. Thus, both the arbitrator or arbitration panel and the superior courts upon confirmation are limited to applying only N.C.G.S. \u00a7 1-567.11 in determining whether counsel fees should be or were properly awarded in an arbitration proceeding.\nAm Jur 2d, Arbitration and Award \u00a7\u00a7 6, 139; Statutes \u00a7 257.\n5. Arbitration and Award \u00a7 34 (NCI4th)\u2014 arbitration award \u2014no increase by court for counsel fees\nThere is no provision or authority in N.C.G.S. \u00a7 1-567.11 or elsewhere in the Arbitration Act allowing a court to increase an arbitration award by adding counsel fees not contained in the award.\nAm Jur 2d, Arbitration and Award \u00a7\u00a7 6, 139.\nOn defendant\u2019s petition for discretionary review pursuant to N.C.G.S. \u00a7 7A-31(a) of an opinion of the Court of Appeals, 103 N.C. App. 518, 405 S.E.2d 776 (1991), affirming the judgment awarding plaintiff\u2019s attorneys fees pursuant to the provisions of N.C.G.S. \u00a7 6-21.2, entered by Griffin, J., on 2 May 1990 in Superior Court, Mecklenburg County. Heard in the Supreme Court on 11 May 1992.\nDeLaney and Sellers, P.A., by Ernest S. DeLaney III, for plaintiff-appellee.\nKennedy Covington Lobdell & Hickman, by Raymond E. Owens, Jr. and Alice C. Richey, for defendant-appellant.\nBaer Marks & Upham, by Anthony De Toro, for defendant-appellant."
  },
  "file_name": "0148-01",
  "first_page_order": 196,
  "last_page_order": 204
}
