Therefore, the Nevada courts will likely enforce contractual requirements according to which parties must mediate prior to filing a lawsuit. The Nevada courts will likely compensate the prevailing party (based on terms of the contract) with the attorney’s fees for breaching mediation clauses.
Industry Update: Mediation is a Condition Precedent to Filing a Lawsuit
In MB America, Inc., v. Alaska Pacific Leasing Company, 132 Nev. Adv. Op. 8 (February 4, 2016), the Nevada Supreme Court dismissed MB America’s breach of contract lawsuit because MB America did not first submit the parties’ dispute to mediation as required by the contract.
The Supreme Court considered that MB America must send a request to “any of the AAA’s regional offices or case management centers” to start a mediation. However, MB America did not do so.
MB America argued that it was not required to submit the dispute to mediation previous to filing suit since Alaska Pacific did not consent to a mediation. The Supreme Court rejected this argument. The Nevada Supreme Court also awarded Alaska Pacific its fees for contesting the lawsuit.