Thus, when a claim against MMAWC and others was filed in Nevada District Court alleging a violation of the settlement agreement and a violation of the license agreement, the defendants duly requested termination on the basis of the arbitration clause. However, the District Court disagreed and concluded that the arbitration clause was unenforceable under NRS 597.995 and that the parties were not required to settle the claims. Any contested civil action filed in the District Court will be reviewed by the Alternative Dispute Resolution Office (“ADR”). The Alternative Dispute Resolution Commissioner reviews more than 8,000 cases each year to determine whether a matter remains before the designated judge or is referred to arbitration or other forms of ADR. Among other tasks, the ADR officer is responsible for resolving problems arising from proceedings during ADR and is appointed by and responsible for the district judges. A common way for employers to try to implement a mandatory arbitration program is to enter into an arbitration agreement, which is included in an employee handbook. Recently, however, several courts have concluded that certain arbitration agreements contained in employee manuals are unenforceable. The courts have argued that while arbitration agreements are preferred under the law, arbitration agreements are still contracts by their very nature and must follow the common law principles of contract drafting. In a victory for residential developers looking for an alternative forum to settle construction defect claims, the Nevada Supreme Court ruled that CC&R arbitration agreements are binding.
Based on the following points, the court rejected any notion that these arbitration provisions are unenforceable: Given this landmark Nevada Supreme Court decision, residential developers should not hesitate to include binding arbitration agreements in CC&R. Nor should there be any reluctance to apply arbitration as an alternative to the traditional, time-consuming and costly processes of construction defects. MMAWC d/b/a World Series of Fighting, et al v Zion Wood Obi Wan Trust, et al, 135 Nev. Announcement. Article 38 (2019) concerned a dispute relating to the applicability of an arbitration clause in a licence agreement. The case began as a complex dispute between many parties involved in professional mixed martial arts and led to a comprehensive settlement agreement. A key clause in the settlement was an amended license agreement that included a newly added arbitration clause: the Fat Hat court ruled that other contracts existed under the rule. “In addition to a line of signatures at the end of the contracts,” the employees “filled in their names and addresses in the empty fields of the [arbitration] provision and expressly stated that the arbitration agreement was effective.” Id. Also in Larson v. D. Westwood, Inc., a federal court in Nevada, ruled that a tripartite arbitration rule that is part of an eight-page contract satisfies Nevada`s specific approval rule because “[t]he arbitration provision is delimited from the other provisions by capital letters in bold,” “required separate initialization,” and the contract signature page contained a bold title stating that “use as acceptance of the Arbitration Directive.” shall apply`.
Larson v. D. Westwood, Inc., 2016 WL 5508825, at *2 (September 27, 2016). The federal court rejected the plaintiff`s argument that an arbitration clause must be a stand-alone agreement to comply with Nevada`s specific permit rule. Finally, the court rejected the argument of lack of scruples. Requiring arbitration provisions in CC&Rs to be more visible than other provisions is exactly the kind of hostility to arbitration that the FAA is supposed to prohibit. Arbitration provisions must be applied on an equal footing and not be maintained to higher standards. Nor is there any basis for invalidating an arbitration agreement simply because arbitration involves an expedited schedule and an expedited dispute resolution process. In fact, a streamlined dispute resolution process is the nature and main feature of arbitration. That`s why the FAA and public policy prefer arbitration. Therefore, the court raises the issue and at the same time tells you the answer: federal law precedes any state law that treats arbitration agreements differently from other agreements.
Nevada law treats arbitration agreements differently by requiring special language before they can be enforced. The status is therefore pre-empted. This is a fundamental application of the right to facts. Companies that are parties to an arbitration agreement governed by Nevada law should understand that a little-known Nevada law makes these agreements unenforceable if a contract does not have the so-called “specific approval,” which indicates that a person has consented to the arbitration provision itself. While the Nevada Supreme Court has applied this rule to invalidate arbitration agreements, a recent statement from the U.S. Supreme Court reiterated that the Federal Arbitration Act (the “FAA” or the “Act”) prejudges state rules that treat arbitration agreements differently from other treatments. While a court has yet to consider whether the FAA is preempting Nevada law, it is unlikely to survive a preemption analysis. .