Nucor Corp. v. General Bearing Corp.

103 N.C. App. 518 | N.C. Ct. App. | 1991

PHILLIPS, Judge.

The judgment appealed from confirmed an arbitration award to plaintiff in the amount of $1,537,690 and awarded plaintiff attorney’s fees in the amount of $230,653.50 pursuant to the provisions of G.S. 6-21.2. All of defendant’s contentions concern the legal fees awarded. None has merit, and we affirm.

Inter alia, the stock purchase agreement that was arbitrated obligated defendant to convey to plaintiff all the outstanding stock of a subsidiary corporation it owned; to pay plaintiff the value of the subsidiary’s obsolete inventory; to pay any deficiency in the warranted net worth of the subsidiary; and, without specifying a percentage, to pay plaintiff’s reasonable attorney’s fees in the event of default. The agreement also required defendant 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. Despite the provision authorizing the award of attorney’s fees, the arbitration panel declined to award them because of its belief that it had no legal authority to do so. Upon review the Superior Court affirmed the panel’s award and awarded plaintiff an attorney’s fee of 15% of the balance that defendant owed under the agreement.

Defendant’s main contention is that in reviewing the arbitration panel’s award the Superior Court had no authority to award attorney’s fees in the first instance, because an award of attorney’s fees for work performed in arbitration proceedings is precluded by the following provision of G.S. 1-567.11:

Unless otherwise provided in the agreement to arbitrate, the arbitrators’ 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.

This provision only precludes an award of attorney’s fees by an arbitration panel, it does not ban an award by the Superior Court. G. L. Wilson Building Co. v. Thorneburg Hosiery Co., Inc., 85 N.C. App. 684, 355 S.E.2d 815, disc. review denied, 320 N.C. 798, 361 S.E.2d 75 (1987).

Though G.S. 6-21.2 expressly authorizes the award of attorney’s fees in suits to collect any “evidence of indebtedness,” defendant argues that the fees were not authorized because the stock purchase agreement involved was not an “evidence of indebtedness” within the contemplation of that statute. But the term “evidence of indebtedness” as used in G.S. 6-21.2, so the Court held in Stillwell Enterprises, Inc. v. Interstate Equipment Company, 300 N.C. 286, 294, 266 S.E.2d 812, 817 (1980), refers “to any printed or written instrument, signed or otherwise executed by the obligor(s), which evidences on its face a legally enforceable obligation to pay money,” and the agreement involved is obviously such an instrument.

Nor, as defendant argues, did the trial court err in awarding a fee of 15% of the balance that defendant owed plaintiff without receiving evidence as to the nature and extent of the work done and its reasonable value. For G.S. 6-21.2(2) expressly provides that when a contract authorizing attorney’s fees does not specify the fee percentage that it shall be construed to mean 15% of the “outstanding balance” owed on the obligation involved, and in setting the fee the court merely followed the statutory mandate.

Affirmed.

Judges Eagles and WYNN concur.