With the increased costs of litigation, companies are looking for alternative methods of dispute resolution. Alternative dispute resolution (ADR) has become an attractive option for many companies looking to avoid the time and costs typically associated with litigation. Depending on the type of issues being faced, ADR can provide a more effective way of resolving disputes, both from a timing and cost perspective. Although there are many different types of ADR, the most widely utilized are arbitration and mediation. In addition to arbitration and mediation, both the Nevada state courts and federal courts have created an expedited program for civil jury cases, which can reduce the time and costs associated with typical litigation.
Arbitration
Arbitration most resembles traditional litigation. In arbitration, a disputed matter is submitted to a neutral third party who hears arguments from each side, reviews evidence and makes a decision. Arbitration is less formal than a trial, and the parties can often control the process by agreement, including by limiting discovery, which can reduce costs. Most parties utilize arbitration rules and arbitrators associated with the American Arbitration Association or JAMS; however, parties can agree to utilize anyone as an arbitrator. Arbitrations generally are resolved much quicker than formal court litigation, and the proceedings are not public record. However, depending on the complexity of the dispute, arbitration might not always be cheaper than the court, especially considering that, in arbitration, the parties typically pay an hourly rate for the arbitrator’s time. Also, in binding arbitration, parties generally cannot appeal the arbitrator’s award even if it is not supported by the evidence or law. In Clark and Washoe Counties, parties may be required to participate in a court-annexed arbitration program if certain conditions are met – the main condition being cases with damages anticipated to be less than $50,000.
Mediation
In mediation, a neutral third party helps the parties to reach an agreeable resolution of a dispute. A mediator facilitates communication between the parties but does not generally make a decision regarding the merits of the dispute nor force the parties into an agreement. Mediation allows parties the ability to craft solutions that might not be available in typical litigation, and mediation can be used to settle a wide range of disputes. Parties can also decide to mediate a dispute even if litigation has already been initiated. Having a successful mediation is usually dependent on having a good mediator who will help the parties to better understand their problems, defuse unrealistic expectations, suggest solutions and persuade parties to accept resolutions. Mediation is generally a good option when both parties are motivated to resolve a dispute.
Short Trial Programs
The Nevada state and federal courts have created “short trial” programs that provide an alternative to traditional trials. Although the state and federal court programs have different procedures, the premise of both programs is to expedite civil jury trials. In the short trial program, discovery is more limited, smaller juries are used and there are time limits for the length of the trial. In the federal court program, the trial must commence within 150 days from the judge being assigned, while in the state court program, the trial must commence no later than 240 days of the case entering the program. In the federal court program, short trials are presided over by an active or senior district court judge or a magistrate judge. In the state court program, short trials are presided over by a pro tempore judge, which is an attorney selected by a panel of attorneys who have at least 10 years of trial experience. After the final judgment is entered, parties may file direct appeals to the appropriate appellate court.
It’s important to consult legal counsel to determine which alternative method is likely to have the best outcome for the given case, but it’s also important to know that litigation is not the only option.
Brandon Johansson, Associate, Financial and Real Estate Services & Kevin Stolworthy, Partner and Las Vegas Office Managing Attorney, Armstrong Teasdale LLP
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