DONALD BOYD MORGAN,
Plaintiff-appellant
v
.
Davidson County
No. 05 CVS 2484
LEXINGTON FURNITURE
INDUSTRIES, INC., d/b/a
LEXINGTON HOMEBRANDS,
Defendant-appellee
Morgan, Herring, Morgan, Green, Rosenblutt & Gill, L.L.P., by
James F. Morgan for plaintiff-appellant.
Brooks, Pierce, McLendon, Humphrey & Leonard, L.L.P., by
Robert J. King, III and Kathleen A. Gleason for defendant-
appellee.
CALABRIA, Judge.
Donald Boyd Morgan (“plaintiff”) appeals the trial court's
grant of summary judgment to Lexington Furniture Industries, Inc.,
d/b/a/ Lexington Homebrands (“defendant”). We affirm.
On 15 June 2003, plaintiff and defendant executed an
Independent Account Management Agreement (“the contract”).
Pursuant to the contract, plaintiff solicited orders from
defendant's customers within the sales territory for the products specified by the company. The contract contained an arbitration
provision which stated, in pertinent part,
[a]ny dispute . . . which may arise between
the parties . . . in connection with this
Agreement or its breach . . . shall be
submitted to arbitration[.] Any request for
arbitration must be filed . . . within 180
calendar days following the date of the
incident[.]
(Emphases added). On 10 December 2004, defendant verbally notified
plaintiff of its intent to terminate the contract. Five days
later, on 15 December 2004, defendant sent a letter to plaintiff
confirming their prior conversation regarding the decision to
terminate the contract and included a formula calculating
plaintiff's compensation as well as notice of payment for
commissions for bona fide customer orders received through 10
December 2004.
On 29 September 2005, plaintiff filed an amended complaint
seeking lost wages on the grounds he was wrongfully terminated.
Defendant filed a motion for summary judgment contending
“[p]laintiff did not take any legal action, including filing an
arbitration demand, within 180 calendar days of the incident[.]”
On 19 October 2005, the trial court granted defendant's summary
judgment motion. Plaintiff appeals.
It should be noted that plaintiff, in assigning error to the
summary judgment order, fails to include the appropriate record or
transcript pages, as required by N.C. R. App. P. 10(c)(1) (2006).
However, the order granting summary judgment and the notice of
appeal from that order immediately precede the record page listingthe assignments of error. In this context, it is clear that the
assignment of error to the summary judgment order on page 48 of the
record refers to the order on page 46 and notice of appeal on page
47.
Plaintiff initially argues that the trial court erred in
granting defendant's summary judgment motion. Summary judgment is
appropriate “if the pleadings, depositions, answers to
interrogatories, and admissions on file, together with the
affidavits, if any, show that there is no genuine issue as to any
material fact and that any party is entitled to a judgment as a
matter of law.” N.C. Gen. Stat. . 1A-1, Rule 56(c) (2005). “When
reviewing a lower court's grant of summary judgment, our standard
of review is de novo.” Stafford v. County of Bladen, 163 N.C. App.
149, 151, 592 S.E.2d 711, 713 (2004), disc. review denied, 358 N.C.
545, 599 S.E.2d 409 (2004). “[W]e review the record in a light
most favorable to the party against whom the order has been entered
to determine whether there exists a genuine issue as to any
material fact.” BellSouth Telecomm., Inc. v. City of Laurinburg,
168 N.C. App. 75, 80, 606 S.E.2d 721, 724 (2005), disc. review
denied, __ N.C. __, 615 S.E.2d 660-61 (2005).
Similarly, “[t]he trial court's conclusion that a particular
dispute is or is not subject to arbitration is a conclusion of law,
and is reviewable by the appellate courts de novo.” Hobbs Staffing
Servs. v. Lumbermens Mut. Cas. Co., 168 N.C. App. 223, 225, 606
S.E.2d 708, 710 (2005). Here, the issue is whether the arbitration agreement between
the parties governs, and whether its terms are enforceable as a
matter of law. The parties agree that the contract between them
contained an arbitration clause, and that the arbitration required
that a request for arbitration be filed with the American
Arbitration Association within 180 calendar days “following the
date of the incident complained of, or within any thirty calendar
days following the end of any mediation process attempted by the
parties, whichever is shorter.”
In this case, the “incident complained of,” namely plaintiff's
termination, occurred 10 December 2004, and plaintiff did not file
suit until 26 August 2005, more than 180 days after the
termination. Plaintiff did not file a demand for arbitration.
North Carolina has a three-year statute of limitations for
breach of contract actions. N.C. Gen. Stat. . 1-52(1) (2005).
However, it is established that parties may shorten applicable
statutes of limitation so long as the contractual limitation is
reasonable. Holmes & Dawson v. East Carolina Ry., 186 N.C. 58, 63,
118 S.E. 887, 890 (1923). Our courts have held arbitration
agreements to be valid and enforceable. “North Carolina has a
strong public policy favoring the settlement of disputes by
arbitration.” Johnston County v. R.N. Rouse & Co., 331 N.C. 88,
91, 414 S.E.2d 30, 32 (1992).
The plaintiff makes several arguments in support of his
contention that the trial court erred by determining that the
arbitration provision was binding and in turn entering a summaryjudgment order. Plaintiff argues that he was forced to delay
filing his complaint because the defendant refused to provide
plaintiff with a copy of the employment contract. There is no
evidence in the record supporting this argument, and we will thus
not consider it on appeal. “In appeals from the trial division of
the General Court of Justice, review is solely upon the record on
appeal . . . .” N.C. R. App. P. 9(a) (2006). Further, because
plaintiff signed the contract, he is charged with knowledge of its
contents.
It is the duty of one signing a written
instrument to inform himself of its contents
before executing it, if he has the ability and
opportunity to do so, and in the absence of
fraud or overreaching he will not be allowed
to impeach the effect of the instrument by
showing that he was ignorant of its contents
or failed to read it.
Harrison v. Southern R. Co., 229 N.C. 92, 95, 47 S.E.2d 698, 700
(1948). “[A] signed paper writing demonstrates full knowledge and
assent as to what is contained therein.” Park v. Merrill Lynch,
159 N.C. App. 120, 126, 582 S.E.2d 375, 380 (2003).
Plaintiff further argues that the reasonableness of the
provision requiring any dispute to be submitted to arbitration
within 180 days remains a genuine issue of material fact, and that
the trial court erred by entering the summary judgment order.
Plaintiff's argument is misplaced, as the determination of whether
a contractually-shortened statute of limitations is reasonable
calls for a legal rather than factual conclusion. Badgett v. Fed.
Express Corp., 378 F. Supp. 2d 613, 623 (M.D.N.C. 2005). In Badgett, the United States District Court for the Middle
District of North Carolina considered the issue of whether North
Carolina courts would uphold as reasonable a clause in an
employment contract requiring all claims against the employer to be
brought within six months of the action in question. The court
stated, “Reasonableness is not subject to well-defined or commonly
accepted tests or standards, but usually depends on all the facts
and circumstances of a particular case.” Id.
North Carolina has several six-month statutes
of limitations affecting claims by employees.
North Carolina statutes require employees
bringing employment discrimination claims
under the Persons with Disabilities Protection
Act to bring civil actions within 180 days.
See N.C. Gen. Stat. § 168A-12. Employees
believing they have been discriminated against
because of their AIDS or HIV status are
limited to a 180-day period. See id. §
130A-148(i). So too are employees who are
wrongfully discharged for instituting a
worker's compensation claim. See id. § 1-55.
A similar period limits the time an employee
can file complaints of discrimination with the
North Carolina Department of Labor. See id. §
95-242.
Id. at 625.
The Badgett court's analysis of North Carolina law is
instructive, and demonstrates that North Carolina does not consider
a 180-day filing limit to be per se unreasonable. In the instant
case, the parties agreed that any dispute arising out of the
plaintiff's employment would be submitted to arbitration within six
months of the incident in question. The plaintiff's knowledge of
the contract's contents are established by his signature, and his
bargaining power is demonstrated by his changing the terms of thecontract by crossing out some sentences and altering the contents
of others. These changes, which relate to the term of the
agreement and the termination provisions, are initialed by the
plaintiff. Given the plaintiff's apparent bargaining power, the
public policy favoring arbitration agreements, the fact that our
courts routinely allow parties to contractually shorten statutes of
limitation, and the fact that our legislature has, in certain
employment-related cases, required parties to file grievances
within 180 days of the incident complained of, we cannot find the
present arbitration agreement to be unreasonable. The agreement
allowed the plaintiff to file for arbitration within six months of
his termination, and allowed subsequent appeal to our state's
courts if he was not satisfied with the arbitrator's decision.
Because plaintiff failed to file his dispute within the
contractually-agreed upon time, his claim is barred by the statute
of limitations.
The plaintiff raises additional arguments in his reply briefs,
and these arguments will not be considered on appeal, as they have
not been properly presented to this Court. “A reply brief is
'intended to be a vehicle for responding to matters raised in the
appellees' brief' and is 'not intended to be _ and may not serve as
_ a means for raising entirely new matters.'” Newsome v. N. C.
State Bd. Of Elections, 105 N.C. App. 499, 504, 415 S.E.2d 201,
203-04 (1992) (quoting Animal Protection Soc'y v. N.C., 95 N.C.
App. 258, 269, 382 S.E.2d 801, 808 (1989)). Plaintiff next argues that the trial court erred by entering
judgment dismissing his action. Although we have already determined
that summary judgment was properly granted, we note that the
plaintiff's second assignment of error has not been properly made,
and will not be considered on appeal.
North Carolina Rule of Appellate Procedure 10(c)(1) (2006)
states, in pertinent part: “[e]ach assignment of error . . . shall
state plainly, concisely and without argumentation the legal basis
upon which error is assigned.” The plaintiff's second assignment
of error states as follows:
2. The Trial Court erred and committed
reversible error by signing and entering the
Judgment that dismissed the action without
recovery by Plaintiff.
This assignment of error violates Rule 10(c)(1) since it does not
state a legal basis upon which the error is predicated. See May v.
Down East Homes of Beulaville, Inc., __ N.C. App. __, __, 623
S.E.2d 345, 346 (2006). Furthermore, Rule 10(c)(1) also states
“[a]n assignment of error is sufficient if it directs the attention
of the appellate court to the particular error . . . with clear and
specific record or transcript references.” However, plaintiff's
second assignment of error violates this rule since it is
unaccompanied by record or transcript references. See Munn v. N.C.
State Univ., 360 N.C. 353, 359, 626 S.E.2d 270, 271 (2006), rev'g
per curiam for reasons stated in __ N.C. App. __, __, 617 S.E.2d
335, 339 (2005) (Jackson, J., dissenting). Based on the
aforementioned rule violations, we dismiss this assignment of
error. See Viar, 359 N.C. at 401, 610 S.E.2d at 360; Munn, 360N.C. at 354, 626 S.E.2d at 271. Accordingly, the judgment of the
trial court remains undisturbed.
Affirmed.
Judge JACKSON concurs.
Judge GEER concurs in a separate opinion.
Report per Rule 30(e).
DONALD BOYD MORGAN,
Plaintiff,
v
.
Davidson County
No. 05 CVS 2484
LEXINGTON FURNITURE
INDUSTRIES, INC., d/b/a
LEXINGTON HOMEBRANDS,
Defendant.
GEER, Judge, concurring.
I concur fully in the majority opinion's conclusion that
plaintiff failed to demonstrate that the six-month time limitation
in the contract is unreasonable. In arguing unreasonableness,
plaintiff relies solely on defendant's failure to supply him with
a copy of his employment contract. He points to no other
circumstances that would justify holding the six-month time
limitation to be unreasonable and does not contend the provision
otherwise violates North Carolina public policy. I write
separately only to emphasize the narrowness of this decision.
I agree with the majority opinion that any delay in
voluntarily supplying plaintiff with a copy of his employment
contract is not a sufficient basis for disregarding the six-month
time limitation. Plaintiff negotiated, reviewed, and signed the
contract only 18 months before he was terminated. I cannot
conclude that it is unreasonable to expect plaintiff to remember
the terms of his contract sufficiently to assert a claim within six
months of his termination. Indeed, plaintiff's brief on appealstates that "[a]lthough Morgan was not given a copy of the
employment agreement, it was his understanding that the parties had
specifically deleted the termination without cause provision."
That deletion is at the heart of plaintiff's claim.
In other words, plaintiff did recall the terms of his contract
pertinent to his claims. His lack of confirmation of his
recollection of those terms cannot, without more, support his
argument that the time limitation is unreasonable. Significantly,
plaintiff cites no authority supporting such a position. Plaintiff
has not, however, offered any other justification for finding the
time limitation unreasonable.
(See footnote 1)
If this Court were to accept plaintiff's argument, we would,
as a practical matter, effectively eviscerate most contractual time
limitations. A party could demand that the opposing party
voluntarily produce certain documents relevant to his or her claim
and, then, if the opposing party declined to engage in voluntary
production, argue that the time limitation was unreasonable because
of the withholding of documents. Since plaintiff's argument hinges
exclusively on defendant's failure to voluntarily produce
documents, I cannot perceive of any basis for overturning the trial
court's entry of summary judgment. Finally, I feel compelled to point out that I am not certain
the reasonableness of the time limitation is a question properly
decided by the courts given the parties' contract. Ordinarily, the
sole question for the trial court and this Court would be whether
the parties' contract contained an enforceable arbitration
agreement. If so, the trial court would compel arbitration. At
that point, it would be the responsibility of the arbitrator to
rule on the reasonableness of any limitations in the contract. See
Ragan v. Wheat First Sec., Inc., 138 N.C. App. 453, 455, 531 S.E.2d
874, 876 ("In considering a motion to compel arbitration, the trial
court should determine (1) the validity of the contract to
arbitrate and (2) whether the subject matter of the arbitration
agreement covers the matter in dispute. Once the court answers
these questions in the affirmative, the parties must take up all
additional concerns with the arbitrator." (internal citations and
quotation marks omitted)), disc. review denied, 353 N.C. 268, 546
S.E.2d 129 (2000).
Nevertheless, defendant did not move to compel arbitration,
plaintiff has expressed no interest in arbitrating, and the parties
have not addressed the authority of this Court to decide the
reasonableness of the time limitation. In light of the positions
of the parties, I believe the majority has properly gone ahead and
addressed the reasonableness issue.
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