COA Says Arbitration Clause Governing "Any Dispute" Includes Claim for Unfair and Deceptive Trade Practices

In Linsenmayer v. Omni Homes, an arbitration clause in a construction contract said that arbitration was the proper avenue should "any dispute arise relative to the performance of this contract that the parties cannot resolve[.]" The COA held that “any dispute” included plaintiffs' claim that defendants were liable for unfair and deceptive trade practices, and the arbitrator could thus award treble damages. While the clause made no mention of punitive or exemplary damages, it did not "specifically exclude any particular form of damages" and did "in effect allow for punitive or exemplary relief." The COA also held in Linsenmayer that the arbitrator did not have to specify that the lump sum arbritration award included treble damages. The trial court previously found that defendants were liable for unfair and deceptive trade practices and noted that such damages would be "statutorily appropriate" before it stayed the litigation and compelled arbitration.

Appellate Rules Violations Fail Dogwood Test, Sanctions Imposed

In Weeks v. Select Homes, Inc., the COA held that the plaintiffs' Appellate Rules violations rose to the level of a “substantial failure or gross violation” under the standard established in Dogwood Dev. & Mgmt. Co. v. White Oak Transp. Co. (NC 2008). The Plaintiff’s rules violations included numerous formatting errors, a failure to state the grounds for appellate review, and a failure to reference any assignments of error following the questions presented. The COA heard the merits of plaintiff’s case but imposed sanctions, ordering the plaintiff’s counsel to: “(1) pay double the printing costs of this appeal and (2) review the Rules of Appellate Procedure and certify by affidavit to this Court that he will be more diligent and comply with the Rules of Appellate Procedure in any future appeals.”

COA Says Rule 59 Motions for a New Trial May Be Filed Before Entry of Judgment

Yesterday the COA addressed an issue of first impression for North Carolina courts – whether a trial court can hear a Rule 59 motion for new trial filed before the entry of judgment. The case is Xiong v. Marks. Rule 59 says that a motion for a new trial shall be served no later than 10 days after entry of the judgment, but does not specify whether a motion for new trial may be filed before entry of judgment. The COA concluded in Xiong that a Rule 59 motion can be filed before entry of judgment, and based this holding on various federal cases and what it described as “practice in our trial courts.” The Court held that language in Watson v. Dixon, 130 N.C. App. 47, 51, 502 S.E.2d 15, 19 (1998), stating that “Rules 50 and 59 of our Rules of Civil Procedure implicitly provide that these post-trial motions cannot be filed until after entry of judgment,” was dicta because the relevant issue in Watson was when the tolling of the 30-day time period for filing a notice of appeal begins. Judge McGee wrote a separate concurrence to reiterate that the holding in Xiong is not inconsistent with Watson because the seemingly relevant language in Watson is nonbinding dicta.

Today's COA Opinions

Today the NC Court of Appeals released 15 published opinions. Six of them are in criminal cases, and two are in domestic cases. More on these cases later.

NC Supreme Court Hears Medical Ass'n-Death Penalty Case

Today the NC Supreme Court heard oral argument in N.C. Dep't of Correction v. N.C. Medical Board. The case concerns the Medical Board's recently adopted policy against physician participation in executions, which conflicts with state law requiring that a physician be "present" at an execution. For a story on how today's oral argument went, see here.

Fourth Circuit To Become More Liberal?

Here's an interesting article on how the Fourth Circuit might change under the new President.

Appellate Rule Violations Clear Dogwood Hurdle

Today the COA addressed on remand a case in which it had dismissed an appeal for appellate rule violations. The case is Selwyn Village Homeowners Ass'n v. Cine & Co. When the case was last before the COA, the Court dismissed the appeal because of noncompliance with formatting requirements, including an improperly indexed margin, failure to single-space issues in the body of the brief, and an improperly indexed appendix to the brief. The Supreme Court remanded the case for reconsideration in light of Dogwood Dev. & Mgmt. Co. v. White Oak Transp. Co. (NC 2008), which held that not all rule violations warrant dismissal. In today's case, the COA held that the violations, while numerous, weren't jurisdictional, substantial, or gross violations, and therefore sanctions were not warranted.

In light of the Supreme Court's recent intervention in this area (in Dogwood and Hart), there is now a positive trend of not letting non-jurisdictional rule violations thwart review on the merits.

COA Allows Battery Suit Againt Clay Aiken

Today the COA dealt with a lawsuit against Clay Aiken by an author who wrote a book about him. The case is Holleman v. Aiken. She sued him because he refused to endorse her book. The COA affirmed the tossing of that claim. But she also sued him for battery based on an incident with his bodyguard: Aiken had allegedly directed his bodyguard to remove her from a chair, which he did by grabbing her arm and yanking her. The COA held that the battery claim gets to go forward, including a claim for punitive damages.

COA Says Spoliation Isn't A Basis For Sanctions

Today in a case from the Industrial Commission the COA held that while spoliation of evidence can have evidentiary consequences (it can give rise to an adverse inference instruction), it is not itself a basis for sanctions in the absence of other independent statutory or rule violations authorizing the imposition of sanctions. The case is Holloway v. Tyson Foods, Inc.

Cell Phone Contempt Reversed

Today, in State v. Phair, the COA reversed a contempt order issued against a criminal defense lawyer for keeping her cell phone on in court. Her cell phone rang during the State's questioning of a witness. The trial court ordered her to forfeit her phone so it could be destroyed, or to pay a $100 fine. The COA held that she merely make a mistake in not turning off her phone before entering the courtroom; it was "certainly irresponsible" but not a conscious disregard of the trial court's authority.

COA Warns Insurance Carriers

Today the COA confronted a weird insurance case. It was a car accident case in which the negligent defendant and his carrier never offered to settle, so the case went to a jury trial, at which the plaintiff prevailed, winning a damages of $9,055 and prejudgment interest of $875, for a total judgment of $9,930. Because the total judgment was less than $10,000, the trial court exercised jurisdiction under G.S. 6-21.1 to award attorney fees to the plaintiff. That statute allows fees to be awarded to a plaintiff if the insurer wasn't warranted in refusing to pay the claim and (here's the key part) the judgment is $10,000 or less. What made this case weird is that the defendant appealed on the ground that the trial court should've hit him for more prejudgment interest. The defendant argued that if prejudgment interest were higher, the total judgment would've tipped over $10,000, thus divesting the trial court of jurisdiction to award fees. The COA didn't buy it.

The Court added a warning to insurance companies. The Court thought it "important to note" that the amount of fees was directly attributed to the delay caused by defendant's carrier's failure to make good faith attempts to settle. And, because of defendant's appeal, the insurer "delayed paying plaintiff's counsel an additional year and has likely caused plaintiff to incur additional attorney's fees for this appeal," the Court added. "This common practice has deterred attorneys from representing plaintiffs in these actions due to the likely delay of payment for the attorney's services," the Court said. The Court closed, "We hope that in the future, N.C. Gen. Stat. § 6-21.1 will encourage insurance companies to make efforts to resolve such personal injury claims quickly, so that they are not required to pay additional legal fees of the plaintiff."

Today's COA Decisions

Today the Court of Appeals issued 15 published decisions. Seven are in criminal cases, eight are in civil cases. More on these cases later.