Hope & Associates, Inc. v. Marvin M. Black Co., A92A1096
| Decision Date | 24 September 1992 |
| Docket Number | No. A92A1096,A92A1096 |
| Citation | 205 Ga.App. 561,422 S.E.2d 918 |
| Parties | HOPE & ASSOCIATES, INC. v. MARVIN M. BLACK COMPANY. |
| Court | Georgia Court of Appeals |
Scott E. Tinnon, Atlanta, for appellant.
Griffin, Cochrane, Marshall & Elger, Terrence L. Croft, Atlanta, for appellee.
Appellant appeals from an order of the superior court confirming an arbitration award in favor of appellee.
1. The arbitration award provided for appellee's recovery of attorney's fees. Appellant urges that, as a matter of law, attorney's fees cannot be awarded in arbitration proceedings.
(Emphasis supplied.) City of Lawrenceville v. Heard, 194 Ga.App. 580, 583(2), 391 S.E.2d 441 (1990). There is no Georgia statute specifically authorizing the recovery of attorney's fees in arbitration proceedings. However, the contract between appellee and appellant did specifically provide for the recovery of attorney's fees by the "prevailing party" in arbitration proceedings. "The parties to a contract may establish by its terms any subject matter in which they have an interest so long as it is not prohibited by statute or public policy...." Seaboard CLR Co. v. Freight Delivery Svc., 133 Ga.App. 92, 94(1), 210 S.E.2d 42 (1974). Accordingly, the issue for resolution is whether the provision regarding attorney's fees contained in appellee's and appellant's contract is prohibited by statute or public policy.
There is no general public policy against contracting for the recovery of attorney's fees. See generally O'Brien's Irish Pub v. Gerlew Holdings, 175 Ga.App. 162, 165(4), 332 S.E.2d 920 (1985). There is no reason to suggest that a contract for the recovery of attorney's fees in arbitration proceedings would be violative of public policy. Indeed, the public policy of this state favors enforcement of the terms of an arbitration agreement. See OCGA § 9-9-3.
Appellant urges that there is a statutory prohibition on the right of parties to an arbitration agreement to contract for the recovery of attorney's fees in arbitration proceedings. "Unless otherwise provided in the agreement to arbitrate, the arbitrator's 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." OCGA § 9-9-17 (formerly codified as OCGA § 9-9-97(a)). By its terms, this statute does not specifically prohibit the parties from contracting for the recovery of attorney's fees in arbitration proceedings. It merely addresses the allocation of the expenses of arbitration other than attorney's fees and provides that, as to the allocation of those expenses, the award will control insofar as it is not inconsistent with the parties' agreement. Thus, in the absence of any agreement by the parties as to the allocation of expenses other than attorney's fees, the arbitrators' award as to the allocation of those expenses will control. If, however, the parties themselves have agreed to an allocation of those expenses, the parties' agreement will control notwithstanding the arbitrators' determination as to allocation. To construe OCGA § 9-9-17 as a statutory prohibition on the right of parties to contract for the recovery of attorney's fees would be to construe that provision as a statutory "restraint of the common-law right of freedom to contract...." Fireman's Fund Ins. Co. v. Pekor, 106 Ga. 1, 13, 31 S.E. 779 (1898). However, "[t]he common law leans towards that construction of all statutes, which is in favor of personal liberty, not that which is against personal liberty." Elam v. Rawson, 21 Ga. 139, 143 (1857). Accordingly, construing OCGA § 9-9-17 according to its own terms, it does not purport to restrain the common-law right of freedom to contract for attorney's fees in arbitration proceedings, but merely provides for the allocation of expenses other than attorney's fees.
Thus, there is no statutory prohibition on the right to contract for the recovery of attorney's fees in arbitration proceedings. If the parties contract for attorney's fees, that agreement will be enforced. If the parties do not contract for attorney's fees, each party will be responsible for the payment of his own attorney's fees. To the extent that Walton Acoustics v. Currahee Constr. Co., 197 Ga.App. 659, 399 S.E.2d 265 (1990) and Hughes & Peden v. Budd Contracting Co., 193 Ga.App. 656, 388 S.E.2d 753 (1989) construe OCGA § 9-9-17 as a statutory restraint on the common-law right of freedom to contract, those decisions are erroneous and are hereby overruled.
2. Appellant's remaining...
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..."[t]here is no general public policy against contracting for the recovery of attorney's fees." Hope & Assocs., Inc. v. Marvin M. Black Co., 205 Ga.App. 561, 422 S.E.2d 918, 919 (1992). The Court has already determined that the GSA is itself enforceable, though San Miguel is not permitted to......
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