Court Opinion

ID: 9468629
Source: CourtListenerOpinion
Date Created: 2023-08-05 02:19:21.407342+00
Date Added: 2024-06-11T17:40:57.572497
License: Public Domain

WIDENER, Circuit Judge,
dissenting:
I respectfully dissent to the denial of rehearing in this case.
As I have previously pointed out in dissent, the basic theme of the majority opinion, 4 Cir., 656 F.2d 933, is its lack of confidence in the' North Carolina courts to enforce the Federal Arbitration Act. At the time the case was decided and the majority opinion was filed, I thought that lack of confidence was without foundation, and so expressed myself.
Unknown to us at the time the case was decided, but following argument, the Supreme Court of North Carolina had decided the case of Burke County Public Schools, etc. v. Shaver, etc., 303 N.C. 408, 279 S.E.2d 816 (1981). Burke was a case on facts indistinguishable from those now before us and is one of the very cases1 relied on by the majority to illustrate why the North Carolina courts would not try this ease under federal substantive law (the Federal Arbitration Act).
The gist of the majority decision here as shown by the opinion itself is as follows:
“This is a case where it can be fairly said to be doubtful whether the rights of Mercury as fixed by ‘federal substantive law’ will be recognized in the state court.” P. 946.
Contrast that statement of North Carolina law as expressed in the majority opinion with North Carolina law as expressed by the North Carolina Supreme Court in Burke:
“This appeal presents two questions. First, whether the contract between plaintiff and defendant is ‘a contract evidencing a transaction involving commerce’ within the meaning of § 2 of the Federal Arbitration Act. [Footnote omitted] We conclude that it is. Second, whether the Federal Arbitration Act must be applied in state courts. We hold, for reasons given, that it must.” 279 S.E.2d at p. 817.
Not only was the holding of the North Carolina Supreme Court that which I have just quoted, the opinion goes on in detail to provide as follows:
“. . . Parties in a state court to a contract evidencing an interstate transaction should not be permitted to avoid arbitration when, had the action been brought in federal court, they would have been compelled to arbitrate. This much flows from the denomination of compulsory arbitration as a matter of substantive, rather than procedural, law.” 279 S.E.2d at 824-825, note 16.
Additionally, the court in Burke not only held, p. 825, that the contract in question “must be submitted to arbitration pursuant to the federal act,” as one of the reasons therefor it gave that the application of the federal substantive law “discourages ‘forum shopping’ ”. Burke, p. 824.
*937Thus, the recent decision of the North Carolina Supreme Court, coming as it did after argument in this case but before decision, although unbeknownst to us at that time, but known to us prior to the time this order is entered denying rehearing, should have disabused this court of any notions it may have had that the North Carolina courts would not follow the federal substantive law. To deny rehearing in this case, even without mention of the reversal of one of the cases on which it principally depends, I find inexplicable.
The upshot of this case is that our court is treating a cause of action concerning the Federal Arbitration Act in many respects as general federal question litigation, which it is not, rather than as diversity litigation, which it is.
I am authorized to state that Judge HALL joins in this dissent.

. The majority opinion relied on the decision in the North Carolina intermediate court of appeals which was reversed by the decision referred to in this paragraph.