LEGAL GUIDE
Written by attorney Jonathan Craig Reed | Nov 23, 2010

How does the Clark County Mandatory Arbitration Program Work?

WHICH CASES ARE INCLUDED IN THIS PROGRAM?

Most cases that are filed in Clark County District Court which make a claim for money are automatically put into the Court's mandatory, non-binding, arbitration program if the money claim is for not more than $50,000. (More about this limit later.)

HOW ARE ARBITRATORS SELECTED AND WHO ARE THE ARBITRATORS?

The office of the Alternative Dispute Resolution (ADR) Commissioner sends out to the parties' attorneys (or the party if the party is representing themself) a list of 5 or more Court appointed Arbitrators. Each party may cross out two names. After the parties respond, if more than one Arbitrator is left the ADR office randomly selects one to be assigned to the case. When attorneys get the list of possible Arbitrators they typically decide who to strike by doing some of the following: 1) The ADR office at 330 S. Third Street, Room 1060, in downtown Las Vegas has a looseleaf folder of Arbitrators' resumes which can be examined in the ADR office, 2) Much information on local attorneys can be found on the web, 3) Attorneys often ask other attorneys about their experiences with a particular Arbitrator. To become a Court Appointed Arbitrator a local attorney needs to have at least 8 years of experience and take some rather minimal Arbitrator training. Arbitrators are paid by the parties and bill at the rate of $100/hr., although they can only bill for 10 hours. For a variety of reasons the average pay collected by an Arbitrator is usually less than this rate. Many successful attorneys who average an hourly rate much higher than this serve as Arbitrators for these reasons: 1) It is a form of public service, 2) They enjoy the opportunity to get acquainted with some of the other lawyers in town who practice in their fields of interest, 3) Being a "judge" is a change of pace from being an advocate, 4) Potentially it leads to more lucrative work in private arbitrations where fees are much higher. Almost always the Court appointed Arbitrators are private practice attorneys for whom the Court appointed Arbitration work is a very small percentage of their overall work load.

WHAT HAPPENS WHEN AN ARBITRATOR IS APPOINTED?

After an Arbitrator is appointed, he or she must set up a meeting, often conducted by phone conference to discuss the case, to discuss what needs to be done before the arbitration hearing, and to set an arbitration hearing date. The Arbitrator is entitled to demand a deposit of $250 from each party (or each side, if two or more parties are lined up together) to insure payment of the Arbitrator's bill for fees and for costs such postage, copies, but also secretarial time. Technically, this deposit is the obligation of the client, not the attorney. However, attorneys concerned about their reputation in the legal community either advance the arbitrators' deposit (most contingent fee cases) or secure that in advance from their clients so they don't get a reputation for taking such marginal cases that they stiff the Arbitrator. As a result, if for example, a potential personal injury client comes to see me about taking their case I figure it will cost me about $350 to file and serve suit and another $250 right away for the Arbitrator, so I figure that unless I'm willing to put out an immediate $600 for the case if it doesn't settle, I shouldn't take the case. On the downside, the mandatory arbitration program effectively means the filing fee is now about $600. After the arbitration hearing the Arbitrator writes a Decision. This usually settles the case and is the beneficial side of this mandatory arbitration program. However, either side may disregard the Arbitrator's decision and file request a trial. Thus, winning an arbitration is no gaurantee of getting paid shortly thereafter. However, if a party does request a trial because they don't like the Arbitrator's decision and they get a less favorable result at trial they face various financial penalties. Also, at trial the Arbitrator's decision can be told the judge or jury. This is why the parties usually accept the Arbitrator's decision.

HOW DOES THE $50,000 LIMIT WORK IN PERSONAL INJURY CASES?

With respect to the $50,000 limit, in personal injury cases if the plaintiff is not more than 50% at fault, but is somewhat at fault, the award to the Plaintiff is reduced by the percent that the Plaintiff is at fault. For example, if a Plaintiff is 50% at fault and has damages of $80,000, the Plaintiff would be awarded $40,000. However, in this mandatory arbitration program the limit for damages, without regard to fault is $50,000. This means that in the above example the Arbitrator should award $25,000 as that is half of the limit of $50,000.

CAN A CASE BE REMOVED FROM THE MANDATORY ARBITRATION PROGRAM IF THE CLAIM BECOMES LARGER BEFORE THE ARBITRATION HEARING?

If the Plaintiff's attorney at the time of filing suit thinks the case is worth more than $50,000, they should file and request an exemption from arbitration which is usually granted, depending on the evidence provided by the attorney. If after filing suit but before the Arbitration Hearing the plaintiff's attorney becomes convinced that the case has become worth more than $50,000, they can make a late motion to remove the case from arbitration. This will usually be granted but may be conditioned upon the plaintiff's side paying all of the Arbitrator's fees to date, rather than just half.

Additional resources provided by the author

See the ADR Commissioner's webpage at http://www.clarkcountycourts.us/ejdc/courts-and-judges/adr/arbitration/arbitration.html or Google "Clark County, Nevada, ADR" to get to that page.

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