After an arbitration is conducted pursuant to the Family Law Arbitration Act, GS Chapter 50, Article 3, GS 50-41 et. seq., and an arbitration award is entered by the arbitrator, the role of the trial court is limited. A trial court’s job is to determine whether the arbitrator award should be confirmed, modified, or vacated, pursuant to GS 50-53, 50-54, and 50-55. The trial court has no authority to retry the case. A trial court has the authority to vacate an arbitration award for errors of law only if the parties agreed in their arbitration contract that the court can review errors of law.GS 50 54(a)(8). 

Where the parties agreed that errors of law in the arbitration award could be a basis for vacating the arbitration award, the trial court did not err in vacating portion of the equitable distribution award containing a legal error. It was legal error by the arbitrator to distribute the husband’s separate loan debt to him and to order that he pay off the debt earlier than required by the terms of the loan. The arbitrator did not err in failing to consider the capital gains tax consequences from the sale of a house anticipated by the arbitration award when there was no evidence of the tax consequences introduced during the arbitration hearing.  An arbitrator’s award cannot be vacated by the trial court for abuse of discretion by the arbitrator. The arbitrator did not err in refusing to impute income to wife in determining alimony and child support where there was no evidence that wife was deliberately depressing her income in bad faith. 

After claims were filed by both wife and husband, the parties agreed to submit equitable distribution, alimony and child support to binding arbitration pursuant to the NC Family Law Arbitration Act, GS Chapter 50, Article 3. As part of the arbitration contract, the parties agreed that a trial court could review any alleged errors of law in the final arbitration award. When the arbitrator issued the arbitration award, wife filed a motion requesting that the trial court confirm the award and enter judgment in accordance with the award, and the husband requested that the trial court vacate or modify the award based on his alleged errors of law. The trial court entered judgment vacating portions of the award and confirming the award as modified by the removal of the vacated portions. Both parties appealed. 

The court of appeals noted that the Family Law Arbitration Act allows a trial court to vacate an award by an arbitrator only for reasons set out in GS 54(a), which includes errors of law by the arbitrator that prejudices a party’s rights only if the parties agree in the arbitration contract that a review of errors of law is allowed. In this case, the parties agreed to such a review. The trial court vacated two provisions in the arbitrator’s award. The first was a statement by the arbitrator that the arbitrator lacked the authority to order the sale of marital property. The court of appeals did not decide whether this statement by the arbitrator was legally incorrect after concluding that neither party showed how this statement by the arbitrator affected them in the final award. The trial court also vacated a portion of the award dealing with a mortgage debt that the parties stipulated was the separate debt of husband. The arbitrator had ordered that the debt be distributed to the husband and ordered that he make a lump sum payment on the debt after the sale of marital property and ordered that husband pay off the debt entirely by a specific date. 

The trial court determined that the arbitrator did not have authority in equitable distribution to distribute separate debt or to order that husband pay the debt in a way not required by the mortgage contract. The court of appeals affirmed the trial court, holding that a judge in equitable distribution can distribute marital debt but has no authority to distribute separate debt or to order that a party pay off separate debt. However, the arbitrator did not commit legal error by ordering that husband continue to make the mortgage payments on his separate debt as part of the alimony and child support portion of the arbitrator award. The wife and child resided in the residence encumbered by the mortgage and the arbitrator had the authority to order husband to make the mortgage payments as part of the support order. Husband also argued that the arbitrator erred by failing to consider the capital gains consequences from the sale of a house that was marital property when the sale was anticipated by the arbitration award. The court of appeals held that the arbitrator was not required to consider 24 any tax consequences of the sale when there was no evidence of those consequences introduced during the arbitration. 



Regarding the arbitrator’s award for alimony and child support, the court of appeals held that the husband’s alleged errors amounted to an argument that the arbitrator abused her discretion in determining the appropriate amount of monthly support. While the award of the arbitrator can be reviewed for errors of law, the arbitrator award cannot be vacated for an abuse of discretion. Finally, the court of appeals held that the arbitrator did not err in failing to impute income to wife where there was no evidence that she was deliberately depressing her income in bad faith. She stopped working when the child of the parties was born, and she was a stay-at-home mother and homemaker by agreement of the parties.