DAVID PARKS,
Plaintiff,
v
.
CHRISTOPHER GREEN,
Defendant.
Downer, Walters & Mitchener, P.A., by Joseph H. Downer and
Stephen W. Kearney, for plaintiff-appellee.
Dean & Gibson, L.L.P., by Thomas G. Nance, for defendant-
appellant.
EAGLES, Chief Judge.
Christopher Green, (“defendant”), appeals from an order
enforcing an arbitration award in favor of David Parks,
(“plaintiff”), and an order denying defendant's motion for
reconsideration. After careful consideration, we affirm.
On 1 January 1996, plaintiff and defendant, each operating
their own motor vehicle, were involved in an automobile collision
in Mecklenburg County. Plaintiff commenced this negligence action
on 9 September 1998 seeking $8,000.00 for his personal injuries and
damages as a result of the automobile collision. After notice of
non-binding arbitration pursuant to G.S. § 7A-37.1 and the Rules
for Court-Ordered Arbitration dated 5 February 2001, both plaintiff
and defendant made pre-arbitration filings. At the arbitration hearing on 13 March 2001, plaintiff, his
attorney, defendant's attorney and a claims representative from
defendant's insurance carrier were present. Defendant did not
attend in person. The arbitrator awarded plaintiff $3,000.00 and
defendant requested a trial de novo. On 29 March 2001, plaintiff
moved to enforce the arbitration award. On 4 April 2001, defendant
filed an affidavit by Emilia Carlisle (“Carlisle”), the claims
representative of defendant's insurer, Allstate Insurance Company
(“Allstate”), who attended the 13 March arbitration hearing. This
affidavit purported to show that Carlisle “had full authority to
make binding decisions on behalf of the Defendant in all matters in
controversy before the arbitrator.” On 9 May 2001, defendant filed
a copy of defendant's automobile liability policy provided by
Allstate.
A hearing on plaintiff's motion to enforce the arbitration
award was held on 4 June 2001 in Mecklenburg County District Court
before Judge Fritz Mercer. The trial court ordered that the
arbitration award be enforced and struck defendant's request for a
trial de novo.
Defendant moved for reconsideration on 17 July 2001 and
defendant's motion included his own affidavit. Defendant stated in
his affidavit that Allstate “has and at all relevant times has had
the authority to make binding decisions on my behalf with regard to
the settlement or other disposition of the claims pending in this
lawsuit.” Defendant further stated that Carlisle “had authority to
make binding decisions on my behalf with regard to all matters incontroversy in this case and before the Arbitrator.” After a
hearing on 4 September 2001, Judge Mercer, by order dated 21
September 2001, denied defendant's motion for reconsideration.
Defendant appeals from both orders.
Defendant contends on appeal that the trial court erred in
granting plaintiff's motion to enforce the arbitration award and in
denying defendant's motion for reconsideration. After careful
consideration, we affirm.
Defendant first contends that the trial court erred in
granting plaintiff's motion to enforce the arbitration award and
striking defendant's request for a trial de novo. We disagree.
Rule 3(p) of the North Carolina Rules for Court-Ordered
Arbitration (N.C. Arb. R. 3(p)) states:
Parties Must Be Present at Hearings;
Representation. All parties shall be present
at hearings in person or through
representatives authorized to make binding
decisions on their behalf in all matters in
controversy before the arbitrator. All parties
may be represented by counsel. Only
individuals may appear pro se.
In Mohamad v. Simmons, 139 N.C. App. 610, 612, 534 S.E.2d 616,
618 (2000), the defendant did not appear at a mandatory non-binding
arbitration hearing but “counsel purporting to represent defendants
and an adjuster employed by their liability insurance carrier were
present.” The trial court determined that defendants' failure to
appear at the arbitration hearing was in violation of Rule 3(p) of
the Rules for Court-Ordered Arbitration. Id. On appeal, the
defendants argued that Rule 3(p) “allows appearance by counsel or
a liability insurance carrier representative in lieu of the actualparties.” Id. In affirming the trial court, this Court noted that
“no evidence in the record reflects that counsel purporting to
appear on defendants' behalf or the representative of defendants'
liability insurance carrier were authorized 'to make binding
decisions . . . in all matters' on behalf of defendants.” Id. at
614, 534 S.E.2d at 619. This Court stated that
no documents in the record, such as
defendants' contract with counsel, an
affidavit setting forth the nature of the
representational relationship and the
authority of counsel, or defendants' policy of
insurance, indicate the attorney purporting to
represent defendants or the representative of
their liability insurance carrier who were
present at the hearing possessed in this case
authority “to make binding decisions on
[defendants'] behalf in all matters in
controversy before the arbitrator.”
Id. at 613, 534 S.E.2d at 619 (quoting N.C. Arb. R. 3(p)) (emphasis
in original).
Here defendant argues that he complied with the Rules for
Court-Ordered Arbitration since his attorney and a claims
representative from his insurer were present. Defendant contends
that the insurance representative had authority to make binding
decisions in all matters in controversy on defendant's behalf.
Defendant argues that the Rules for Court-Ordered Arbitration do
not require that he give notice that he did not plan to attend or
that he provide documentary evidence to the arbitrator showing that
his representative had the necessary authority. Defendant contends
that he provided an affidavit from a representative of his
insurance company that stated she had the requisite authority, a
copy of his insurance policy and in addition, an affidavit fromdefendant stating that the insurance representative had the
necessary authority. Defendant argues that this evidence complied
with the requirements set forth in Mohamad to show that the
insurance representative had the necessary authority to represent
him at the hearing.
However, the trial court made the following findings of fact:
14. There was no documentation or evidence
presented, at the time of the arbitration, to
show that either the Defense attorney or the
Allstate adjuster were authorized to make
binding decisions on behalf of the Defendant
in all matters in controversy before the
arbitrator.
15. The Defendant's attorney, prior to the
hearing on the above-captioned motion but
after the arbitration, filed a copy of
Defendant's Insurance Policy and an affidavit
from the Allstate Insurance Company adjuster
purporting to show authority on Defendant's
behalf.
16. There was no documentation or evidence
presented, from the named Defendant, to show
that either the Defense attorney or the
Allstate adjuster were authorized to make
binding decisions on behalf of the Defendant
in all matters in controversy before the
arbitrator.
The trial court then made the following conclusions of law:
1. Defendant did not act in good faith by
failing to appear at the arbitration and
failing to notify Plaintiff that they did not
intend to appear at the arbitration.
. . . .
3. The failure of the Defendant to comply
with the mandatory attendance requirement
subverts and completely eviscerates the Rules
of Arbitration. 4. Defendant failed or refused to participate
in the arbitration proceeding in good faith or
in a meaningful matter [sic].
Defendant's reliance on merely including certain documents in
the record is misplaced. Without discussing the sufficiency of the
documents to provide authority to act on defendant's behalf, we
note that the affidavit from the representative of defendant's
insurance carrier was filed on 4 April 2001 and a copy of
defendant's automobile insurance policy was filed on 9 May 2001.
Both of these documents were filed after the arbitration which took
place on 13 March 2001. Further, defendant's personal affidavit
was not filed until 17 July 2001 with defendant's amended motion
for reconsideration. This document was filed approximately four
months after the arbitration hearing and approximately six weeks
after the trial court's hearing on plaintiff's motion to enforce
the arbitration award. The notice of the arbitration hearing,
dated 5 February 2001, approximately five weeks prior to the
arbitration hearing, stated that “[a]ll parties must be present at
the hearing or represented by someone authorized to make binding
decisions on their behalf in all matters in controversy before the
arbitrator.”
“The purpose of these rules is to create an efficient,
economical alternative to traditional litigation for prompt
resolution of disputes involving money damage claims up to
$15,000.” N.C. Arb. R. 1, official comment.
We believe both the express and implied bases
for the Rules would be subverted, if not
completely eviscerated, if parties were
allowed to disregard the mandatory attendancerequirement without unequivocal evidence in
the record that representatives attending on
behalf of absent parties were indeed
“authorized to make binding decisions on [the
absent parties'] behalf in all matters in
controversy before the arbitrator.” To
conclude otherwise would simply countenance
the failure to participate in mandatory
arbitration “in a good faith and meaningful
manner.”
Mohamad, 139 N.C. App. at 614, 534 S.E.2d at 619 (citations
omitted).
It is not enough for the record to contain this evidence at
the time this Court reviews the matter on appeal. The evidence
showing that defendant's representative had the authority “to make
binding decisions on [his] behalf in all matters in controversy
before the arbitrator” must be known and provided at the
arbitration. This provides the opportunity for the parties and
representatives present at the hearing to participate in good faith
and a meaningful manner.
Defendant further argues that the trial court erred in
concluding that defendant violated the Rules for Court-Ordered
Arbitration based on the finding that defendant “failed to notify
Plaintiff that he did not intend to appear at the arbitration.” We
agree with defendant that this would not be a proper basis for
concluding that defendant's actions were “contrary to the rules and
intent of District Court arbitration.” While there is no evidence
that defendant notified plaintiff that he would not be attending,
the Rules for Court-Ordered Arbitration do not require a party to
give prior notice that the party will not attend. The Rules do
require that the party attend or that someone with authority to acton their behalf attend. See N.C. Arb. R. 3(p). “However, there is
no indication in the order that the trial court's conclusion was
dependent upon this finding.” Bledsole v. Johnson, __ N.C. App.
__, __, 564 S.E.2d 902, 907 (2002).
The defendant failed to appear at the arbitration hearing.
There was no documentation or evidence presented at the arbitration
hearing to show that the Allstate insurance representative or
defendant's attorney were authorized to make binding decisions on
behalf of the defendant in all matters in controversy before the
arbitrator. Further, at the time of the arbitration hearing and
the hearing before the trial court, there was no evidence from
defendant showing that his attorney or the insurance representative
had the requisite authority to act on his behalf. Defendant failed
to comply with Rule 3(p) by “be[ing] present at the hearing in
person or through representatives authorized to make binding
decisions on [his] behalf in all matters in controversy before the
arbitrator.” N.C. Arb. R. 3(p). Accordingly, we affirm the trial
court's conclusions that “[d]efendant's failure to attend the
arbitration . . . is contrary to the rules and intent of District
Court arbitration” and that “[t]he failure of the Defendant to
comply with the mandatory attendance requirement subverts and
completely eviscerates the Rules of Arbitration.”
Rule 3(l) of the Rules for Court-Ordered Arbitration provides
that “[a]ny party failing or refusing to participate in an
arbitration proceeding in a good faith and meaningful manner shall
be subject to sanctions” set forth in North Carolina Rules of CivilProcedure Rule 37(b)(2)(c). Pursuant to Rule 37(b)(2)(c), the
trial court is allowed to enter “[a]n order striking out pleadings
or parts thereof, . . . or dismissing the action or proceeding or
any part thereof.” G.S. § 1A-1, Rule 37(b)(2)(c). Defendant
concedes in his brief and we hold that the trial court has the
authority to strike his request for a trial de novo as a sanction
pursuant to the Rules for Court-Ordered Arbitration. When a
defendant violates Rule 3(p), “under [appropriate] circumstances,
a trial court's award of sanctions against the defendant in the
form of striking the defendant's demand for trial de novo and
enforcing the arbitration award in favor of the plaintiff is not an
abuse of discretion.” Bledsole, __ N.C. App. at __, 564 S.E.2d at
905. “Sanctions imposed under Rule 37(b)(2)(c) will not be upset
on appeal in the absence of an abuse of discretion.” Mohamad, 139
N.C. App. at 615, 534 S.E.2d at 620. After careful review of the
circumstances here, we conclude that the trial court did not abuse
its discretion in striking defendant's request for a trial de novo
and enforcing the arbitration award.
Defendant next contends that the trial court erred in denying
defendant's motion for reconsideration. Defendant argues that the
basis for his motion was his affidavit stating that the Allstate
insurance representative had “express authority to make binding
decisions on behalf of the named defendant.” Defendant contends
that the trial court accepted his affidavit and it stands
uncontested. We are not persuaded. “[A] motion for relief under Rule 60(b) is addressed to the
sound discretion of the trial court and appellate review is limited
to determining whether the court abused its discretion.” Sink v.
Easter, 288 N.C. 183, 198, 217 S.E.2d 532, 541 (1975). Defendant
does not state in his motion the specific bases for reconsideration
under Rule 60 but appears to argue Rule 60(b)(2) and (6).
Rule 60(b)(2) of the North Carolina Rules of Civil Procedure
“provides in pertinent part that a trial judge may relieve a party
from a judgment when there is 'newly discovered evidence which by
due diligence could not have been discovered in time to move for a
new trial under Rule 59(b).'” Cole v. Cole, 90 N.C. App. 724, 727,
370 S.E.2d 272, 273 (quoting G.S. § 1A-1, Rule 60(b)(2)), disc.
review denied, 323 N.C. 475, 373 S.E.2d 862 (1988). “[T]o
constitute 'newly discovered evidence' within the meaning of Rule
60(b)(2), the evidence must be such that it could not have been
obtained in time for the original proceeding through the exercise
of due diligence.” Waldrop v. Young, 104 N.C. App. 294, 297, 408
S.E.2d 883, 884 (1991). The “newly discovered evidence” must have
been in existence at the time of the trial. Grupen v. Furniture
Industries, 28 N.C. App. 119, 121, 220 S.E.2d 201, 202 (1975),
disc. review denied, 289 N.C. 297, 222 S.E.2d 696 (1976). “This
limitation on newly discovered evidence has been justified on the
firm policy ground that, if the situation were otherwise,
litigation would never come to an end.” Cole, 90 N.C. App. at 728,
370 S.E.2d at 274. Here, defendant asserted in his motion that the trial court
found as fact that there was no evidence in the record from
defendant to show that either his attorney or the Allstate
insurance representative had the requisite authority. The basis
for defendant's motion to reconsider was defendant's own affidavit
which purported to show that the Allstate insurance representative
present at the arbitration hearing had the necessary authority to
act on his behalf. Defendant alleges in his motion that through
due diligence, he was not able to obtain this affidavit before
entry of the trial court's order. Defendant moved for
reconsideration with his affidavit on 17 July 2001.
Defendant's personal affidavit is not newly discovered
evidence. Defendant did not make his affidavit until after the
arbitration and the hearing. Even if the affidavit could be
considered newly discovered evidence, defendant did not exercise
due diligence. Defendant does not explain why he was unable to
obtain his own affidavit prior to the arbitration hearing on 13
March 2001 and the hearing before the trial court on 4 June 2001.
We can discern no abuse of discretion by the trial court in denying
defendant's motion for reconsideration.
Our conclusion under Rule 60(b)(6) is the same. Rule 60(b)(6)
states that relief is available for “[a]ny other reason justifying
relief from the operation of the judgment.” G.S. § 1A-1, Rule
60(b)(6). To set aside a judgment or order under Rule 60(b)(6),
the movant must show that extraordinary circumstances exist and
that justice demands the relief. Jenkins v. Middleton, 114 N.C.App. 799, 800-01, 443 S.E.2d 110, 112 (1994). In addition, the
movant must also show that he has a meritorious defense. State v.
Reid, 35 N.C. App. 235, 237, 241 S.E.2d 110, 111 (1978). Here,
defendant has not shown extraordinary circumstances, that justice
demands relief or a meritorious defense. After careful
consideration, we discern no abuse of discretion.
Accordingly, the decision of the trial court is affirmed.
Affirmed.
Judges MARTIN and HUNTER concur.
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