Title: Frost v. Mazda Motor of Am., Inc
Citation: 353 N.C. 189
Docket Number: 582PA99
State: north-carolina
Issuer: north-carolina Supreme Court
Date: December 21, 2000

JOHN BRENT FROST and CAROLYN FROST and PERSONS SIMILARLY SITUATED
v. MAZDA MOTOR OF AMERICA, INC.; MAZDA MOTORS OF AMERICA (EAST),
INC.; PRIMUS AUTOMOTIVE FINANCIAL SERVICES, INC. d/b/a MAZDA
AMERICAN CREDIT; AL SMITH BUICK CO., INC., a North Carolina
corporation d/b/a Al Smith Buick Dodge Mazda; AUTOMOBILES OF
ASHEBORO, INC., a North Carolina corporation d/b/a Asheboro Honda
Mazda; BOB KING, INC., a North Carolina corporation d/b/a Bob
King Mazda Kia; BURLINGTON LINCOLN-MERCURY LEASING CORPORATION, a
North Carolina corporation d/b/a Burlington Lincoln Mercury/Bill
Ingold Mazda; CITY MOTORS, INC., a North Carolina corporation t/a
City Motors; CHARLES FISHER, INC., a North Carolina corporation
d/b/a Fisher Mazda; FREMA MOTORS, INC., a North Carolina
corporation t/a Frema Motors; GRANT BUICK, INC., a North Carolina
corporation t/a Grant Buick Mazda; DIEFFENBACH CHEVROLET-BUICK,
INC., a North Carolina corporation d/b/a Hank Dieffenbach Mazda;
HENDRICK MANAGEMENT CORPORATION, a North Carolina corporation
d/b/a Hendrick Mazda; HOLIDAY CARS, INC., a North Carolina
corporation d/b/a Holiday Chrysler Plymouth Mazda; HOWELL BUICK,
INC., a North Carolina corporation d/b/a Howell Buick Mazda;
SPORTS AND IMPORTS OF HICKORY, INC., a North Carolina corporation
d/b/a Roberts Mazda Mitsubishi or Sports and Imports, Inc.; a
North Carolina corporation d/b/a Roberts Mazda; SKY COUNTRY
NISSAN, INC., a North Carolina corporation d/b/a Sky Country
Nissan Mazda; SONNY HANCOCK CHEVROLET, INC., a North Carolina
corporation d/b/a Sonny Hancock Mazda; HMMC, INC., a North
Carolina corporation d/b/a Vester Honda, Vester Mazda of Wilson
and Vester Honda-Mazda; CABARRUS AUTO INVESTORS COMPANY, a North
Carolina Limited Partnership, d/b/a Mazda of Concord; ALCOKE AUTO
CENTER LLC, a North Carolina corporation d/b/a New Bern Pontiac
Mazda; SALISBURY LINCOLN-MERCURY, INC., a North Carolina
corporation d/b/a Salisbury Lincoln Mercury Mazda; C&S MOTOR
COMPANY, INC., a North Carolina corporation d/b/a Loughlin
Automotives; LOUIS F. HARRELSON, INC., a North Carolina
corporation d/b/a Harrelson Mazda; CHARLES MONTGOMERY MOTORS,
INC., a North Carolina corporation d/b/a Montgomery Mazda; PARKS
AUTOMOTIVE, INC., a North Carolina corporation d/b/a Parks Mazda;
W.R. WILLIAMSON, INC., a North Carolina corporation d/b/a
Williamson Mazda
No. 582PA99
Filed 21 December 2000
1.
Appeal and Error--interlocutory appeals--certification of
class
In an action arising from an undisclosed fee charged in the
purchase of a leased car, no substantial right was involved in
the trial court’s determination that the case  met the
prerequisites for a class action, and the general rule
disallowing interlocutory appeals of such orders applied.  No
case allowing class certification has been held to affect a
substantial right such that an interlocutory appeal would be
permitted.
2.
Class Actions--notification of class--cost to defendant
In a class action arising from  an undisclosed fee charged
in the purchase of a leased automobile,  the question of whether
a trial court abused its discretion by ordering  that defendant
assume the onus of identifying and sending notice to the class
was interlocutory, but was heard on appeal because the question
is important to all class actions.  The usual rule is that a
plaintiff must bear the cost of notice to the class, but
exceptions  exist and the touchstone is to honor the broad
discretion allowed the trial court in all matters pertaining to
class certification.  There was no abuse of discretion here given
the nearly negligible estimated cost of the notice and the
court’s articulated reason for shifting the cost to defendant
(defendant’s unique control over the identities of the class
members).
On writ of certiorari pursuant to N.C.G.S. § 7A-32(b) to
review an order allowing class certification entered 19 May 1999
by Carter (Clarence W.), J., in Superior Court, Forsyth County,
and the Court of Appeals’ 6 December 1999 order dismissing the
action.  Heard in the Supreme Court 12 September 2000.
Wilson & Iseman, L.L.P., by Urs R. Gsteiger; Randolph
M. James, P.C., by Randolph M. James, for plaintiff-
appellees.
Poyner & Spruill, L.L.P., by David M. Barnes; and Sutherland
Asbill & Brennan LLP, by Thomas M. Byrne,  pro hac vice, for
defendant-appellant Primus Automotive Financial Services,
Inc.
FREEMAN, Justice.
This is a class action lawsuit brought by named plaintiffs
to recover a $158.50 fee charged by the Mazda dealership when
plaintiffs exercised their option to buy their leased vehicle. 
Plaintiffs’ lease agreement with the dealer (on a “Mazda American
Credit” form) failed to disclose that any such fee would be
charged in addition to the purchase-option price stated in the
 The purchase option provision reads, in pertinent part:
1
“Purchase Option:  The Lessee has the option
to purchase the Vehicle at the end of the
lease for $16[,]815.70. . . .  Upon payment
in cash of the purchase option price plus
taxes, the Lessor shall deliver title to the
Lessee.”
agreement.   The fee nevertheless appeared in a space designated
1
“DEL. & HDLG.” on the dealer’s “Retail Buyer[']s Order and
Invoice” executed by plaintiffs when they purchased the vehicle.
On 27 March 1998, plaintiffs filed an amended class action
complaint against their Mazda dealer and, on behalf of all other
lessee-purchasers of Mazda vehicles similarly situated between
1994 and 1998, against every Mazda dealer in North Carolina, two
North American manufacturers of Mazdas, and PRIMUS (d/b/a Mazda
American Credit).  PRIMUS is a finance company that takes
assignment of the lease from the dealer, buys the leased vehicle,
and collects payments from the lessee.  If the lessee ultimately
chooses to buy the vehicle, PRIMUS sells the car back to the
dealer, which then sells it to the lessee.  Plaintiffs alleged
their experience supported claims against all defendants of
breach of contract, negligent misrepresentation, breach of
warranty, fraud, and “unfair and deceptive trade practices.” 
They further alleged that defendants’ acts and omissions, made
knowingly or with willful and wanton disregard for plaintiffs’
rights, supported an award of punitive damages.
The dealership defendants filed a motion to dismiss,  which
was granted to all but Bob King Mazda, the dealership from which
plaintiffs leased, then purchased, their vehicle.  Plaintiffs’
claims against PRIMUS and the Mazda manufacturers remained
extant.
Plaintiffs filed a notice of appeal of the dismissal, which
they subsequently withdrew pursuant to a settlement agreement
with all defendant dealerships, including Bob King Mazda.  In
accordance with the agreement’s terms, plaintiffs also dismissed
all claims against all dealership defendants.
This agreement was approved by a court order, which noted
that the settlement included the dealerships’ agreement to “pay
plaintiffs’ counsel the amount of $34,300.00 as reimbursement for
part of the costs and attorneys’ fees associated with the
prosecution of this matter.”  In addition, in reciting
plaintiffs’ agreement to execute a tortfeasors’ release of all
(and only) the dealership defendants, the court stated it “makes
no finding as to the adequacy or inadequacy of the Frosts as
class representatives [and] makes no finding as to the legal
effect of said release.”
On 19 May 1999, the trial court granted plaintiffs’ motion
for class certification.  The court found, inter alia, that a
class of plaintiffs existed with an interest in the same issues
of law and fact, including whether charging monies in addition to
the purchase-option price plus taxes breached the lease, was an
“unfair and deceptive practice” under chapter 75-1.1 of the North
Carolina General Statutes, was fraudulent, and was sufficiently
aggravated as to warrant the imposition of punitive damages.  The
court found that named plaintiffs would “fairly and adequately
insure the representation of the interests of all class members,” 
that “[t]here is no conflict of interest between the named
plaintiffs and the class members,” and that “named plaintiffs
have a genuine personal interest in the outcome of the action.” 
As to defendant PRIMUS, the court specifically found:
As part of the relief granted for plaintiffs’ motion to
compel, defendant PRIMUS has been ordered to list the
name, address, and telephone number of all persons who
are potential class members; to wit: those persons who
entered a net closed[-]end lease with PRIMUS doing
business as Mazda American Credit which contained a
purchase option similar to that in the representative
plaintiffs’ lease and were charged monies in addition
to the purchase[-]option price plus taxes when they
exercised their option to purchase.  This information
is uniquely within defendant PRIMUS’ control but
defendant PRIMUS withheld this information without
objection and despite the fact that the parties had
entered a consent confidentiality order.  Under the
circumstances the court finds it just and proper that
defendant PRIMUS send the notice approved by the court
to potential class members.
The court accordingly ordered PRIMUS to send the approved notice
of the pending class action “to all potential class members by
First Class United States Mail.”  The same day, the court entered
an order on plaintiffs' motion to compel against PRIMUS,
directing PRIMUS to answer designated interrogatories and produce
certain named documents, but specifically deferring a ruling on
plaintiffs’ request for sanctions.
The Court of Appeals granted plaintiffs’ motion to dismiss
defendant PRIMUS’ interlocutory appeal of the class certification
order and dismissed as moot PRIMUS’ petition for writ of
certiorari.  This Court granted PRIMUS’ petitions for writs of
certiorari and supersedeas, seeking a stay of the trial court’s
orders and review of the class certification order and the
question whether under the circumstances of this case the order
is immediately appealable.
[1] A class certification order is not a final judgment
disposing of the cause as to all parties; the appeal of such
orders is thus interlocutory.  See, e.g., Perry v. Cullipher, 69
N.C. App. 761, 318 S.E.2d 354 (1984) (court order denying class
certification does not determine the controversy and is
interlocutory).  There is no right of immediate appeal from an
interlocutory order, e.g., Travco Hotels, Inc. v. Piedmont
Natural Gas Co., 332 N.C. 288, 292, 420 S.E.2d 426, 428 (1992);
but such appeals are allowed if they involve a matter of law or
legal inference that affects a substantial right of the
appellant, N.C.G.S. §§ 1-277(a) (1999), 7A-27(d)(1); e.g.,
Wachovia Realty Invs. v. Housing, Inc., 292 N.C. 93, 232 S.E.2d
667 (1977) (interlocutory order is appealable if it affects a
substantial right and will work injury to appellants if not
corrected before final judgment).
The “substantial right” test for appealability of
interlocutory orders is that “the right itself must be
substantial and the deprivation of that . . . right must
potentially work injury . . . if not corrected before appeal from
final judgment.”  Goldston v. American Motors Corp., 326 N.C.
723, 726, 392 S.E.2d 735, 736 (1990), quoted in Travco, 332 N.C.
at 292, 420 S.E.2d at 428.  The test is more easily stated than
applied:  “It is usually necessary to resolve the question in
each case by considering the particular facts of that case and
the procedural context in which the order from which appeal is
sought was entered.”  Waters v. Qualified Personnel, Inc., 294
N.C. 200, 208, 240 S.E.2d 338, 343 (1978).
The denial of class certification has been held to affect a
substantial right because it determines the action as to the
unnamed plaintiffs.  E.g., Perry v. Cullipher, 69 N.C. App. at
762, 318 S.E.2d at 356 (if court errs in refusing to certify
class action, named plaintiff may obtain judgment without other
class members, but the latter will suffer an injury that cannot
be corrected absent an appeal before final judgment); see also
Dublin v. UCR, Inc., 115 N.C. App. 209, 221, 444 S.E.2d 455, 462,
disc. rev. denied and appeal dismissed, 337 N.C. 800, 449 S.E.2d
569 (1994).
Heretofore, however, no order allowing class certification
has been held to similarly affect a substantial right such that
interlocutory appeal would be permitted.  In Faulkenbury v.
Teachers’ & State Employees’ Ret. Sys. of N.C., for example, the
Court of Appeals granted certiorari to review an order granting
class certification.  The defendants contended the certification
affected a substantial right because “‘trying this case as a
class action . . . [would] be complex, expensive and time
consuming,’ and [would be] unduly burdensome on defendants given
[the] contention that plaintiff Faulkenbury lack[ed]
representative capacity” for the certified classes.  108 N.C.
App. 357, 375, 424 S.E.2d 420, 429, aff’d per curiam, 335 N.C.
158, 436 S.E.2d 821 (1993).  The Court of Appeals flatly
disagreed.  It noted generally the trial court’s broad discretion
in determining whether to certify a class action.  Id. at 376,
424 S.E.2d at 430 (citing Crow v. Citicorp Acceptance Co., 319
N.C. 274, 284, 354 S.E.2d 459, 466 (1987).  It noted further that
the trial court had made explicit findings as to the
appropriateness of a class action according to criteria stated in
Crow and reaffirmed the policy that “class actions are
appropriate and should be permitted when they can ‘serve useful
purposes’ such as preventing a multiplicity of suits or
inconsistent results.”  Id. (quoting Crow, 319 N.C. at 284, 354
S.E.2d at 466).  Finally, the court rejected the defendants’
substantive contention that the named plaintiff was not
sufficiently representative of the subclasses, observing that the
class members were so numerous as to make individual actions
impractical and a class action efficient and that the named
plaintiff’s interest in the suit was “genuine and typical of the
claims of the other class members.”  Id.
In this case, as in Faulkenbury, defendant challenges the
class certification order on several grounds, among them that
plaintiffs lack representative capacity for the class and that
the class claims differ so greatly that they cannot be
adjudicated as a class action.  We conclude here as the Court of
Appeals did in Faulkenbury that no substantial right is involved
in a trial court’s determination that a case meets the
prerequisites to utilizing a class action as specified in Crow,
and that the general rule disallowing interlocutory appeals of
such orders applies.
[2] Defendant also contends, however, that the trial court’s
directing it to assume the onus of identifying class members and
sending notice to the class “affects a substantial right” and
 We note that this issue would no more be immediately
2
appealable as a “collateral matter” under the federal test for
interlocutory appeals than it is under the substantial rights
doctrine.  It does not “'finally determine [appellants’] claims
of right separable from, and collateral to, rights asserted in
that for this reason defendant is entitled to immediate appeal of
the order.  We disagree.
Because the cost of sending notice to plaintiff class in
this case is estimated to be modest (less than $500.00), and
because the assessment of such costs is reviewable upon appeal
from a final judgment in this case, we fail to see how
defendant’s right not to bear these costs would be “lost or
irremediably adversely affected,” Blackwelder v. State Dep’t of
Human Res., 60 N.C. App. 331, 335, 299 S.E.2d 777, 780 (1983), if
the order is not immediately reviewed.  “If appellant’s rights
‘would be fully and adequately protected by an exception to the
order that could then be assigned as error on appeal after final
judgment,’ there is no right to an immediate appeal.”  Howell v.
Howell, 89 N.C. App. 115, 116, 365 S.E.2d 181, 182 (1988)
(quoting Bailey v. Gooding, 301 N.C. 205, 210, 270 S.E.2d 431,
434 (1980)).
Under uncomplicated circumstances such as these, in which a
court’s directive to pay modest fees or costs (or denying such
requests) is part of an order that is not itself immediately
appealable, but which directive, if protected by exception, may
be reviewed after final judgment, no substantial right is
involved.  Like the order certifying plaintiff class of which it
is part, the directive is thus not appealable before final
judgment.   See, e.g., State ex rel. Martin v. Sloan, 69 N.C. 128
2
the action, too important to be denied review and too independent
of the cause to require that appellate consideration be deferred
until the whole case is adjudicated.'”  Eisen v. Carlisle &
Jacquelin, 417 U.S. 156, 171-72, 40 L. Ed. 2d 732, 744-45 (1974)
(quoting Cohen v. Beneficial Indus. Loan Corp., 337 U.S. 541,
546, 93 L. Ed. 1528, 1536 (1949)) (emphasis added).  Unlike the
order at issue in Eisen or an interlocutory order granting a
motion to disqualify counsel, see Goldston, 326 N.C. at 726, 392
S.E.2d at 736, this order is not “effectively unreviewable on
appeal from a final judgment,” id. at 727-28, 392 S.E.2d at 737;
accord Firestone Tire & Rubber Co. v. Risjord, 449 U.S. 368, 375,
66 L. Ed. 2d 571, 579 (1981).
We note in addition that directing defendant to send notice
to class plaintiffs, while stated as part of the certification
order, was specifically “part of the relief granted for
plaintiffs' motion to compel.”  As such, this directive could be
viewed as having been imposed upon defendant as a discovery
sanction authorized by Rule 37(b) of the North Carolina Rules of
Civil Procedure.  But a separate order on plaintiff’s motion to
compel issued the same day by the same judge, which specifically
“deferred” ruling on plaintiffs' request for sanctions, makes it
clear it was not.
(1873) (the Supreme Court will not decide a case on the question
of costs alone unless some substantial right is involved).  Cases
holding otherwise are distinguishable by the complexity or
finality of their facts.  See e.g., Lowder v. All-Star Mills
Inc., 309 N.C. 695, 309 S.E.2d 193 (1983) (interlocutory court
order awarding fees to receivers’ counsel appealable when
employment of counsel by receivers held improper and counsel
discharged before culmination of underlying action); Wachovia
Realty Invs. v. Housing, Inc., 292 N.C. 93, 232 S.E.2d 667
(premature summary judgment for balance due on note without
considering issue of set-off or credit affected plaintiff’s
substantial right when execution entered on judgment and lien
imposed on plaintiff’s funds, but procedures to stay execution
would involve substantial expense); Waldo v. Wilson, 177 N.C.
461, 100 S.E. 182 (1919) (when plaintiffs instigated unnecessary
appeal, order taxing defendant with cost of copying transcript
appealable); Horner v. Oxford Water & Elec. Co., 156 N.C. 494, 72
S.E. 624 (1911) (ruling on motion to apportion costs reviewable
when court lacked power); May v. Darden, 83 N.C. 237 (1880)
(although general rule is that no appeal lies from a judgment for
costs only, exception in favor of executors as fiduciaries makes
decision in such cases one affecting substantial rights); Miller
v. Henderson, 71 N.C. App. 366, 322 S.E.2d 594 (1984) (order
granting request for attorneys’ fees from dismissed defendants
was substantially same as partial judgment against plaintiff for
monetary sum and as such affected substantial right).
Nonetheless, because this question is important to all class
actions, we granted certiorari and so exercise our supervisory
powers over the courts of this state, N.C.G.S. § 7A-32(b) (1999),
to address whether it is ever proper to direct a defendant to
assume the onus and costs of notifying putative members of the
plaintiff class.
This is a question of first impression in this jurisdiction. 
Our appellate courts have been careful to distinguish North
Carolina’s Rule 23 and its construction from its federal
counterpart and commentary by federal courts.  See, e.g., Crow,
319 N.C. at 279, 354 S.E.2d at 463 (assuming General Assembly
rejected three additional subparagraphs of Rule 23 to simplify
class actions and to provide greater flexibility); Dublin, 115
N.C. App. at 219, 444 S.E.2d at 461 (noting “substantial
differences” between Rule 23 in North Carolina and its federal
 N.C. R. Civ. P. 23 provides, in pertinent part:
3
Rule 23.  Class actions.
(a) Representation. -- If persons
constituting a class are so numerous as to
make it impracticable to bring them all
before the court, such of them, one or more,
as will fairly insure the adequate
representation of all may, on behalf of all,
sue or be sued.
. . . .
(c) Dismissal or compromise. -- A class
action shall not be dismissed or compromised
without the approval of the judge.  In an
action under this rule, notice of a proposed
dismissal or compromise shall be given to all
members of the class in such manner as the
judge directs.
N.C.R. Civ. P. 23(a), (c).  Analogous provisions of Fed. R. Civ.
P. 23 provide:
(a)  Prerequisites to a Class Action. 
One or more members of a class may sue or be
sued as representative parties on behalf of
all only if (1) the class is so numerous that
joinder of all members is impracticable,
(2) there are questions of law or fact common
to the class, (3) the claims or defenses of
the representative parties are typical of the
claims or defenses of the class, and (4) the
representative parties will fairly and
adequately protect the interests of the
class.
. . . .
(e)  Dismissal or Compromise.  A class
action shall not be dismissed or compromised
without the approval of the court, and notice
of the proposed dismissal or compromise shall
be given to all members of the class in such
manner as the court directs.
Fed. R. Civ. P. 23(a), (e).  Subsection (f) of the federal rule
explicitly permits the court of appeal to accept interlocutory
appeal from an order of a district court granting or denying
class action certification if application is made within ten days
after entry of the order:
counterpart).   Nevertheless, our courts have been 
3
A court of appeals may in its discretion
permit an appeal from an order of a district
court granting or denying class action
certification under this rule if application
is made to it within ten days after an entry
of the order.  An appeal does not stay
proceedings in the district court unless the
district judge or the court of appeals so
orders.
Fed. R. Civ. P. 23(f) (1998).
attentive to the interpretation of Rule 23 by the federal courts
and have been guided by such interpretation when appropriate. 
See, e.g., Gibbons v. CIT Grp./Sales Fin., Inc., 101 N.C. App.
502, 506, 400 S.E.2d 104, 106 (finding “persuasive” the logic of
Gulf Oil Co. v. Bernard, 452 U.S. 89, 68 L. Ed. 2d 693 (1981),
regarding trial court’s discretion to limit communication with
potential class members under Fed. R. Civ. P. 23(d), which has no
analogue in North Carolina’s Rule 23), disc. rev. denied, 329
N.C. 496, 407 S.E.2d 856 (1991).
Rule 23 does not by its terms require notice to class
members, but adequate notice is dictated by “fundamental fairness
and due process.”  Crow, 319 N.C. at 283, 354 S.E.2d at 466
(citing Eisen v. Carlisle & Jacquelin, 391 F.2d 555, 564 (2d Cir.
1968)).  “The actual manner and form of the notice is largely
within the discretion of the trial court,” but “the . . . court
should require that the best notice practical under the
circumstances should be given to class members . . . includ[ing]
individual notice to all members who can be identified through
reasonable efforts.”  Id. at 283-84, 354 S.E.2d at 466.
Neither North Carolina’s Rule 23 nor Rule 23 of the Federal
Rules of Civil Procedure designates which party should properly
bear the burden of notifying class members.  But the Supreme
Court observed in Eisen that the “usual rule” in a case brought
under Rule 23 “is that a plaintiff must initially bear the cost
of notice to the class. . . .  Where the relationship between the
parties is truly adversary, the plaintiff must pay for the cost
of notice as part of the ordinary burden of financing his own
suit.”  417 U.S. at 178, 40 L. Ed. 2d at 749; see also
Oppenheimer Fund, Inc. v. Sanders, 437 U.S. 340, 356, 57 L. Ed.
2d 253, 268 (1978) (“The general rule must be that the
representative plaintiff should perform the tasks, for it is he
who seeks to maintain the suit as a class action and to represent
other members of his class.”); Federal Judicial Center, Manual
for Complex Litigation 227 (3d ed. 1995) (“[P]arties seeking
class action must initially bear the cost of preparing and
distributing the certification notice required by [Fed. R. Civ.
P.,] 23(c)(2) and the expense of identifying the class
members.”).
Exceptions to this rule inevitably exist.  Some federal
courts have imposed the cost of notice as a sanction for
defendants who demonstrate intransigence in discovery.  E.g.,
Nagy v. Jostens, Inc., 91 F.R.D. 431, 433 (D. Minn. 1981); see
also Six Mexican Workers v. Arizona Citrus Growers, 641 F. Supp.
259 (D. Ariz. 1986) (defendants, who had intentionally failed to
properly maintain records and who had already been found liable,
required to pay costs of notice to individual farm workers whose
whereabouts were unknown).  Other federal courts have recognized
an exception in efficiency.  When, for example, a defendant
happens to have compiled a list of putative class members in the
ordinary course of its business (thus having already accepted the
cost of doing so as a business expense), these courts have
affirmed trial court directives that such defendants divulge or
otherwise make the list available to plaintiffs.  E.g.,
Oppenheimer, 437 U.S. at 358, 57 L. Ed. 2d at 269 (“it may be
appropriate to leave the cost where it falls because the task
ordered is one that the defendant must perform in any event in
the ordinary course of its business”); Southern Ute Indian Tribe
v. Amoco Prod. Co., 2 F.3d 1023 (10th Cir. 1993) (quoting
Oppenheimer); In re Nissan Motor Corp. Antitrust Litig., 552 F.2d
1088, 1101 & n.15 (5th Cir. 1977) (in decisions treating this
question, both plaintiffs and defendants have been ordered to
compile information necessary to identify absentee class members;
whether one party or the other has been designated appears to
have turned on which would have the easier task in gathering the
information sought).  In Oppenheimer, the Court even envisioned
cases in which the expense involved would be “so insubstantial as
not to warrant the effort required to calculate it and shift it
to the representative plaintiff.”  437 U.S. at 358, 57 L. Ed. 2d
at 269.  The Court nevertheless “caution[ed] that courts must not
stray too far from the principle underlying [Eisen, 417 U.S. 156,
40 L. Ed. 2d 732] that the representative plaintiff should bear
all costs relating to the sending of notice because it is he who
seeks to maintain the suit as a class action.”  Id. at 359, 57 L.
Ed. 2d at 270.
Beyond such guidance, however, the touchstone for appellate
review of a Rule 23 order, whether it emanates from a federal or
a North Carolina court, is to honor the “broad discretion”
allowed the trial court in all matters pertaining to class
certification, including appointing responsibility for Rule 23
notice.  See generally Crow, 319 N.C. at 283, 354 S.E.2d at 466
(trial court has “broad discretion in this regard and is not
limited to consideration of matters expressly set forth in Rule
23 or in this opinion”); Charles A. Wright, Arthur R. Miller, &
Mary K. Kane, Federal Practice & Procedure § 1788, at 236 (1986)
(“In general . . . the reported cases seem to indicate that the
court has great discretion and flexibility in determining what is
the best notice practicable under the circumstances and how it is
to be given.”).
We affirm our general agreement with “the principle . . .
that the representative plaintiff should bear all costs relating
to the sending of notice because it is he who seeks to maintain
the suit as a class action.”  Oppenheimer, 437 U.S. at 359, 57 L.
Ed. 2d at 269.  But we note important exceptions to that
principle, such as imposing those costs on the defendant as a
discovery sanction, e.g., Six Mexican Workers, 641 F. Supp. 259,
and allowing the trial court the flexibility and discretion to
order defendants to shoulder this burden when appropriate under
the circumstances of each case.  See Manual for Complex
Litigation at 226-27 (“The problems of notice may be even more
critical with classes composed of individual purchasers of goods
or services, since sales records may be lacking or be incomplete
and unreliable.  Creativity is often needed in devising an
 “Before such means are approved, class counsel should be
4
required to show either a substantial cost saving, other
significant advantages over the use of the mail, or the absence
of reasonable alternatives.  Any increased administrative costs
to the defendant caused by the alternative means of notice should
be taken into account.”  Manual for Complex Litigation at 227. 
effective means of notifying class members.  On occasion, notice
has been distributed with a defendant company’s mailings to . . .
customers, . . . but such procedures have been questioned, not
only because of the administrative burden they can impose but
also because of the potential of prejudice to a defendant from
having to publicize against itself.”).4
In the case before us, deference is due the trial court’s
exercise of discretion in assessing the questions and facts
before it regarding certification of plaintiff class.   Crow, 319
N.C. at 284, 354 S.E.2d at 466; Maffei v. Alert Cable TV of N.C.,
Inc., 316 N.C. 615, 617, 342 S.E.2d 867, 870 (1986).  Generally,
“[t]he test for abuse of discretion is whether a decision ‘is
manifestly unsupported by reason,’ White v. White, 312 N.C. 770,
777, 324 S.E.2d 829, 833 (1985), or ‘so arbitrary that it could
not have been the result of a reasoned decision[,] State v.
Wilson, 313 N.C. 516, 538, 330 S.E.2d 450, 465 (1985).’”  Little
v. Penn Ventilator Co., 317 N.C. 206, 218, 345 S.E.2d 204, 212
(1986).
If in this case the trial court had ordered defendant simply
to make its information available to plaintiff, clearly, this
would have been within its discretion under Rule 23.  See, e.g.,
Oppenheimer, 437 U.S. at 359, 57 L. Ed. 2d at 270 (court acted
within its authority in ordering defendants to direct transfer
agent to make records available to plaintiffs, but abused its
discretion in requiring defendants to bear $16,000 cost of paying
agent to do so); see also In re Nissan, 552 F.2d at 1101 n.15
(listing cases in which plaintiffs and defendants have been
ordered to compile information necessary to the identification of
absentee class members).  Given the nearly negligible estimated
cost of notice in this case and the court’s articulated reason
for shifting the cost of notice to defendant -- its unique
control over the identities of class members -- we see no abuse
of that discretion here.
In its petition for certiorari, defendant also challenges
the class certification order on grounds that the trial court
abused its discretion in certifying as a class members whose
fraud claims would differ so widely regarding proof of reliance
that those claims cannot be adjudicated in a class action. 
Defendant also calls into question whether plaintiffs, who
accepted $34,300 as part of the settlement dismissing all
dealership defendants, remained either able to “fairly and
adequately insure the representation of the interests of all
class members” or free of “conflict of interest [with] class
members.”  Crow, 319 N.C. at 282, 354 S.E.2d at 465.  We do not
address these issues because, as part of the trial court’s
certification order, they are interlocutory and not immediately
appealable.
AFFIRMED.