GEORGE SPERNOCK and
wife, DEBORAH SPERNOCK,
Plaintiffs,
v
.
Union County
No. 01 CVS 1318
T.S. HENSON BUILDERS, INC.,
Defendant.
Weaver, Bennett & Bland, P.A., by Benjamin L. Worley, for
defendant appellant.
No appellee brief.
McCULLOUGH, Judge.
This case arises out of the trial court's order denying
defendant's motion to compel arbitration. The underlying facts are
as follows: Plaintiffs George Spernock and Deborah Spernock own a
home located at 4605 Griffith Road in Union County, North Carolina.
On 20 August 1999, a bolt of lightning struck the home and caused
a fire; plaintiffs' home was completely destroyed.
After the fire, plaintiff Deborah Spernock signed a contract
with T.S. Henson Builders, Inc., to repair the home. George
Spernock never signed the agreement. In the contract, Henson
agreed to [p]rovide all labor, materials, and equipment to repairfire damage to [the] residence while plaintiff Deborah Spernock
agreed to pay the contractor the cost of labor and materials plus
overhead and profit of 20%. The contract also contained an
arbitration clause which stated that [a]ny unresolved controversy
or claim arising from or under this contract shall be settled by
arbitration. The arbitration shall be held under the rules of the
American Arbitration Association.
Plaintiffs filed a complaint against Henson alleging breach of
contract and later filed an amended complaint. Defendant filed an
answer and counterclaim on 19 February 2003. On 12 March 2003,
defendant filed an amended answer and counterclaim that included a
motion to compel arbitration. The trial court denied defendant's
motion to compel arbitration. Defendant appeals.
On appeal, defendant argues that the trial court erred by
denying the motion to compel arbitration. We agree and reverse the
decision of the trial court.
[A]n order denying arbitration, although interlocutory, is
immediately appealable because it involves a substantial right
which might be lost if appeal is delayed. Prime South Homes v.
Byrd, 102 N.C. App. 255, 258, 401 S.E.2d 822, 825 (1991).
Accordingly, this appeal is properly before this Court.
In general, public policy favors arbitration. Raspet v.
Buck, 147 N.C. App. 133, 135, 554 S.E.2d 676, 678 (2001). However,
[t]he law of contracts governs the issue of whether there exists
an agreement to arbitrate. Routh v. Snap-On Tools Corp., 108 N.C.
App. 268, 271, 423 S.E.2d 791, 794 (1992). [T]he party seekingarbitration must show that the parties mutually agreed to arbitrate
their disputes. Id. at 271-72, 423 S.E.2d at 794.
The present case involves a contract to repair a home.
Plaintiff Deborah Spernock signed the agreement with defendant T.S.
Henson Builders, Inc., while her husband, George Spernock, did not.
Defendant contends that both plaintiffs are subject to the
arbitration agreement, even though George Spernock did not sign the
contract. We agree.
As we have indicated, the validity of an arbitration agreement
is a matter of contract law. Since Deborah Spernock signed the
contract, her claims are subject to the arbitration agreement. The
remaining issue is whether her husband, George Spernock, can be
forced to submit his claims to arbitration, even though he never
signed the contract.
Although a party cannot be forced to submit a claim to
arbitration if he or she has not agreed to do so, 'a variety of
nonsignatories of arbitration agreements have been held to be bound
by such agreements under ordinary common law contract and agency
principles.' LSB Fin. Servs., Inc. v. Harrison, 144 N.C. App.
542, 547, 548 S.E.2d 574, 578 (2001)(quoting In re Prudential Ins.
Co. of America Litigation, 133 F.3d 225, 229 (3rd Cir. 1998)).
In the present case, George Spernock joined his wife in filing
a claim for breach of contract. In their amended complaint, both
plaintiffs sought enforcement of the contract and requested money
damages that were in excess of $10,000.00. Furthermore, both
plaintiffs admitted in the pleadings that they were parties to thecontract, irrespective of the lack of a signature by George
Spernock. We cannot see how George Spernock can assert a claim for
breach of contract while simultaneously suggesting that one portion
of the contract, the arbitration clause, should not be enforced.
In fact, this Court expressly rejected such an attempt in Harrison.
Id. at 548-49, 548 S.E.2d at 579 (stating that a party to a
contract was equitably estopped from asserting that the lack of his
signature on the contract precluded enforcement of the contract's
arbitration clause where the party consistently maintained that
other provisions of the contract should be enforced to his
benefit).
For these reasons, we conclude that the trial court erred in
denying defendant's motion to compel arbitration. The trial
court's order is reversed, and the case is remanded for proceedings
not inconsistent with this opinion.
Reversed and remanded.
Judges TIMMONS-GOODSON and HUNTER concur.
Report per Rule 30(e).
*** Converted from WordPerfect ***