Articles Posted in Arbitration & Mediation

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Appellant, a payday loan company, provided loans to the named plaintiffs. The named plaintiffs and other borrowers did not repay their loans, prompting Appellant to file several thousand individual collection actions. Appellant secured thousands of default judgments against the named plaintiffs. It was later discovered that the process server hired by Appellant falsified affidavits of service. The named plaintiffs sued Appellant, alleging that Appellant improperly obtained its default judgments against them and other similarly situated borrowers without their knowledge. Appellant moved to compel arbitration based on the arbitration provisions in its loan agreements. The district court denied Appellant’s motions, holding that Appellant waived its right to arbitrate by bringing collection actions in justice court and obtaining default judgments based on falsified affidavits of service. The Supreme Court affirmed, holding that the district court correctly concluded that Appellant waived its right to an arbitral forum where the named plaintiffs’ claims all concerned the validity of the default judgments Appellant obtained against them in justice court. View "Principal Investments v. Harrison" on Justia Law

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Respondent brought an action against Appellant for professional negligence relating to services that Appellant performed for Respondent. After Respondent filed a demand for arbitration, Appellant submitted what it claimed to be two statutory offers of judgment. Respondent did not accept either offer. A panel of arbitrators subsequently ruled in favor of Appellant. The order stated that each party would bear its own fees and costs. Appellant filed a motion in the district court to correct the arbitration award to order Respondent to pay Appellant’s attorney fees. The district court denied the motion. The Supreme Court affirmed, holding that because the award of fees and costs by an arbitrator is discretionary even after an offer of judgment is made, Appellant did not demonstrate that the arbitrator manifestly disregarded Nevada law by refusing to award it fees and costs. View "WPH Architecture, Inc. v. Vegas VP, LP" on Justia Law

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Three petitioners sued their former employer and certain of its agents and associates (collectively, “Employer”) asserting minimum wage and overtime claims individually and on behalf of others similarly situated. The district court entered orders compelling individual arbitration of Petitioners’ claims and denying their motions for class certification. Each petitioner signed the same long-form arbitration agreement, which included a clause waiving the right to initiate or participate in class actions. Petitioners sought extraordinary writ relief, contending that Employer’s failure to countersign the long-form agreement made it unenforceable, that the class action waiver violated state and federal law, and, in the case of one petitioner, Employer waived its right to compel arbitration by litigating with him in state and federal court. The Supreme Court denied writ relief, holding that Petitioners’ arguments were unavailing and that the district court did not err in compelling individual arbitration of their claims. View "Tallman v. Eighth Judicial Dist. Court" on Justia Law

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Appellant Rolland Weddell and nonparty Michael Stewart were former business partners. When disputes arose between the partners, they agreed to informally settle their disputes by presenting them to a panel of attorneys (Respondents). Respondents issued a decision resolving the parties’ disputes that was largely favorable to Stewart. Thereafter, Stewart filed suit against Appellant seeking a declaratory judgment that Respondents’ decision was valid and enforceable. Appellant proceeded to confess judgment. Appellant later filed this action against Respondents asserting causes of action stemming from Respondents’ conduct in the dispute-resolution process. Respondents moved to dismiss the complaint contending that dismissal was warranted on claim preclusion principles. The district court granted the motion, finding that the three factors for claim preclusion articulated by the Supreme Court in Five Star Capital Corp. v. Ruby had been satisfied. The Supreme Court affirmed after modifying the privity requirement established in Five Star to incorporate the principles of nonmutual claim preclusion, holding that because Respondents established that they should have been named as defendants in Stewart’s declaratory relief action and Appellant failed to provide a good reason for not doing so, claim preclusion applied in this case. View "Weddell v. Sharp" on Justia Law

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In May 2014, the City of Reno decided to lay off thirty-two firefighters. The City stated that its decision was based on a lack of funds. A collective bargaining agreement between the City and the International Association of Firefighters, Local 731 (union) provides that the right to lay off employees due to lack of funds is reserved to the City without negotiation. The union and the firefighters who would be laid off (collectively, IAFF) filed a complaint in the district court, claiming that the City had the funds to continue the firefighters’ employment. The IAFF also filed a motion for preliminary injunctive relief. The City filed a motion to dismiss due to the IAFF’s failure to exhaust contractual and administrative remedies. The district court proceeded to enjoin the City from proceeding with the layoffs while the IAFF exhausted its contractual grievance and administrative remedies. The Supreme Court reversed, holding that the underlying grievance was not arbitrable under the parties’ collective bargaining agreement, and therefore, the district court lacked authority to rule on the request for injunctive relief. View "City of Reno v. Int’l Ass’n of Firefighters, Local 731" on Justia Law

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At a foreclosure mediation, Homeowners and representatives of Lender agreed that foreclosure proceedings would be halted while Homeowners were being considered for a loan modification. Several months later, Homeowners petitioned for judicial review, asserting that Lender breached the parties' agreement. The district court granted the petition, finding Lender had violated the agreement and directing Lender to participate in and pay for further mediation. The Supreme Court dismissed Lender's appeal, holding (1) to preserve and promote the interests of judicial economy and efficiency, an order remanding for further mediation generally is not final and appealable; and (2) the Court lacked jurisdiction to hear this appeal because, given the remand for additional mediation, the district court's order was not final and appealable. View " Wells Fargo Bank, N.A. v. O'Brien" on Justia Law

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Saxon Special Servicing serviced a promissory note that secured a home loan for Appellants. After Appellants stopped making payments to Saxon, a notice of default was recorded. Appellants elected to mediate in Nevada's Foreclosure Mediation Program (FMP). Saxon provided all of the required documents for the mediation, including an eighty-three-day-old broker's price opinion (BPO). The mediator ultimately determined that Saxon failed to provide "an appraisal within sixty days of mediation" because the BPO was not prepared within sixty days of the mediation. The district court concluded that the parties had negotiated in good faith with valid authority and that there was no reason to withhold the FMP certificate. The Supreme Court affirmed the district court's order denying the petition for judicial review, holding (1) the mediation rule requiring an appraisal or broker's price opinion that is no more than sixty days old at the time of the mediation requires substantial, rather than strict, compliance; and (2) Saxon substantially complied with the foreclosure mediation rule requiring a current appraisal. View " Markowitz v. Saxon Special Servicing" on Justia Law

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In 2008, Regents Bank issued two loans to Appellant. After Appellant failed to repay either loan, Regents filed a complaint in district court for breach of contract and judicial foreclosure. The district court stayed the proceedings and compelled arbitration as provided in the loan documents. The arbitrator ultimately ruled in Regents' favor. The district court confirmed the arbitration award and later entered an amended judgment and order of sale. Appellant appealed, arguing (1) Regents employed undue means in procuring the award, and (2) the arbitrator manifestly disregarded the law in refusing to void one of the loans. The Supreme Court affirmed the district court's order confirming the arbitration award, holding (1) Appellant failed to satisfy his burden of proving by clear and convincing evidence that the award was procured through intentionally misleading conduct; and (2) the arbitrator's refusal to void one of the loans was not a manifest disregard of the law. View "Sylver v. Regents Bank, N.A." on Justia Law

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Homeowner attended a first Foreclosure Mediation Program (FMP) mediation with Citimortgage, after which Defendant was denied a loan modification. The district court subsequently ordered a second mediation. PennyMac Corp. later obtained beneficial interest in the deed of trust and promissory note and attended the second mediation. The mediator determined that PennyMac failed to bring the promissory note, deed of trust, and other documents to the mediation and that PennyMac's representative lacked authority to negotiate. Homeowner filed a petition for judicial review, requesting sanctions, attorney fees, and a judicially imposed loan modification. The district court imposed sanctions against PennyMac but declined to impose a loan modification or monetary sanctions beyond the amount of attorney fees. The Supreme Court affirmed, holding (1) Homeowner had standing to challenge the district court's order on appeal; and (2) the district court acted within its discretion in denying an FMP certificate and in determining sanctions. View " Jacinto v. PennyMac Corp." on Justia Law

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A dispute between a bank customer (Customer) and her bank (Bank) over missing endorsements was submitted to arbitration through the American Arbitration Association. The arbitrator issued a written award in Bank's favor and then granted Bank's motion for an order confirming the arbitration award and for entry of judgment on the order. Customer objected, arguing that, pursuant to Nev. Rev. Stat. 38.239, she should have been afforded the opportunity to oppose the motion to confirm and/or to file a competing motion to vacate, modify, or correct the award. The district court denied the motion. The Supreme Court affirmed, holding that the district court erred in summarily confirming the arbitration award against Customer without giving Customer the opportunity to be heard in opposition to the motion to confirm, even though the ninety-day period for Customer to move to vacate, modify, or correct the award had yet to run. View "Casey v. Wells Fargo Bank, N.A." on Justia Law