T. W. Poe & Sons, Inc. v. University of North Carolina

104 S.E.2d 189 (1958) 248 N.C. 617

T. W. POE & SONS, Inc.
v.
The UNIVERSITY OF NORTH CAROLINA.

No. 670.

Supreme Court of North Carolina.

June 30, 1958.

C. Horton Poe, Jr., Durham, for plaintiff-appellant.

Malcolm B. Seawell, Atty. Gen., Claude L. Love, Asst. Atty. Gen., Charles D. Barham, Staff Atty., Raleigh, for defendant-appellee.

WINBORNE, Chief Justice.

While the plaintiff-appellant presents many assignments of error the determination of the appeal turns upon the answer to two questions: (1) Was the award of the arbitrator timely rendered within the meaning of Section 40 of Rule VIII of the Commercial Arbitration Rules of the American Arbitration Association under which the controversy was submitted by the plaintiff and the defendant?

(2) Is the award within the terms of the submission of the controversy to arbitration?

As to the first question: It is not controverted that under applicable rules (1) "the arbitrator shall render his award promptly and, unless otherwise agreed by the parties, or specified by law, not later than thirty days from the date of closing the hearings"; (2) that in the present case the hearings before the arbitrator closed on March 19, 1957; and (3) that, consequently, the time for rendering the award expired April 18, 1957.

Moreover, the award shows on its face that it was signed by the arbitrator and "dated April 17, 1957," and "received April 18, 1957" by the Charlotte, N. C., Tribunal of the Commercial Arbitration Tribunal of the American Arbitration Association Administrator.

Upon these facts there arises the basic question as to whether the award was thereby "rendered" within the meaning of the rule specified. This Court is of opinion, and holds that it was so rendered.

It is contended by appellant that the delivery of the award to the parties, to which Section 44 relates, is a part of the "rendering" of the award, and that until it is so delivered the rendering of it is not complete. This position is untenable. Section 44 of the Rule specifies that the "parties shall accept as legal delivery of the award (a) the placing of the award or a true copy thereof in the mail by the tribunal clerk, addressed to such party at this (?) last known address * * * or (c) by the filing of the award in any manner which may be prescribed by law."

Thus the "rendering" and the "delivery" are provided for in separate sections of the rule. Time limit is specified as to "rendering", but there is no such limitation as to "delivery" of the award. If it had been intended that the time limit should apply to both it would have been natural and easy to say so in express language.

Indeed in this State, as corollary, the Uniform Arbitration Act treats the "making" of the award and the "delivery" of the award to the parties as two separate and distinct provisions. See G.S. § 1-551 and G.S. § 1-557.

As to the second question: Whether the award is within the terms of the submission of the controversy to arbitration, it is appropriate to look to applicable well-established principles of law. In Farmer v. Wilson, 202 N.C. 775, 164 S.E. 356, 357, opinion by Brogden, J., this Court declares that "All courts agree that the submission to an award is the foundation upon which the interpretation and validity of the arbitration and award is built. This prevailing idea was expressed by this court in Geiger v. Caldwell, 184 N.C. 387, 114 S.E. 497, 499, in these words: ``Turning to the authorities, we find it settled that the submission furnishes the source and prescribes the limits of the arbitrators' authority, without regard to the form of the submission. The award, both in substance and in form, must conform to the submission, and the arbitrators are inflexibly limited to a decision of the particular matters referred to them. * * * A submission is in itself a contract, or agreement, or so far partakes of its nature as to be substantially within the principle applicable to contracts and "the basis of the arbitration and award is the submission,"'" citing cases. Indeed, the Court added: "The award must be interpreted in the light of the submission."

Moreover as to the parties involved it is generally held that any person who has a dispute with another person may submit to an arbitration, and it is not necessary to join all the parties who have a joint interest in the matter.

In this connection it is stated in 6 C.J.S. Arbitration and Award, § 9, p. 157, that "One of several persons jointly interested in the subject matter of a controversy may submit the same to arbitration so as to bind himself without the joinder of the others, but he cannot bind the others not joining in the submission except by special authority."

While in the instant case the agreement to submit to arbitration states that separate contracts were let by the owner for plumbing, wiring and heating, and that this controversy involves the question as to which of the contractors, if any, was responsible for the leakage—the plumbing contractor is not a party to the submission and cannot be bound by any award made. Therefore it will be assumed that plaintiff was acting for itself. It will not be assumed that the parties intended to do a vain thing.

Moreover, the agreement concedes that after the building had been completed leakage appeared in a number of showers. As to how many there were, and when they were reported by the owner to the contractor, are matters addressed solely to the arbitrator. Indeed it has been frequently said that arbitrators are not bound to decide according to law when acting within the scope of their authority, "being the chosen judges of the parties and a law unto themselves, but may award according to their notions of justice and without assigning any reason." See Bryson v. Higdon, 222 N.C. 17, 21 S.E.2d 836, 837; Patton v. Garrett, 116 N.C. 847, 21 S.E. 679, 682.

In the Patton case it is said: "* * * If an arbitrator makes a mistake either as to law or fact, it is a misfortune of the party, and there is no help for it. There is no right of appeal, and the court has no power to revise the decisions of ``judges who are of the parties' own choosing.' An award is intended to settle the matter in controversy, and thus save the expense of litigation. If a mistake be a sufficient ground for setting aside an award, it opens the door for coming into court in almost every case; for in nine cases out of ten some mistake either of law or fact, may be suggested by the dissatisfied party. Thus * * * arbitration, instead of ending would tend to increase litigation." See also King v. Falls of Neuse Mfg. Co., 79 N.C. 360; Keener v. Goodson, 89 N.C. 273; Reizenstein v. Hahn, 107 N.C. 156, 12 S.E. 43; Hurdle v. Stallings, 109 N.C. 6, 13 S.E. 720; Wyatt v. Lynchburg & D. R. R. Co., 110 N.C. 245, 14 S.E. 683; Henry v. Hilliard, 120 N.C. 479, 27 S.E. 130; Mayberry v. Mayberry, 121 N.C. 248, 28 S.E. 349; Ezzell v. Rowland Lbr. Co., 130 N.C. 205, 41 S.E. 99; Clark Millinery Co. v. National Union Fire Ins. Co., 160 N.C. 130, 75 S.E. 944.

Under these authorities an award cannot be set aside for lack of evidence and the parties are bound by the award even though it might seem unjust to them.

Indeed "The general rule is that errors of law or fact, or an erroneous decision of matters submitted to the judgment of the arbitrators, are insufficient to invalidate an award fairly and honestly made." 3 Am. Jur. Arbitration and Award, Sec. 135, p. 958. Such is the situation in present case. There is no suggestion of fraud or wrongdoing.

All assignments of error have been given due consideration and, in the light of the above, ground for disturbing the award as made is not made to appear. Hence the judgment from which appeal is taken is

Affirmed.