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This is an important procedural case of first impression in Nevada. The Court was asked to examine two issues involving the interplay between Nevada’s mandatory arbitration rules and Nevada’s mandatory rule of civil procedure, NRCP 41(e) which states that actions must be brought to trial within 5 years after filing or are subject to mandatory dismissal for want of prosecution. Two separate issues were presented to the Court in this context. The first dealt with whether or not the time an action is in Nevada’s mandatory arbitration program tolls the prescriptive time under NRCP 41(e). The second issue examined whether a dismissal under NRCP 41(e) revives the original arbitrator’s award. The case involved a breach on contract action. David Morgan obtained an award in arbitration against the Sands Hotel and the Sands thereafter timely filed its request for trial de novo of the award. Following the request for trial de novo, the Court record reflected the parties were requested to appear before the discovery commissioner who wanted to know why early case conference requirements had not been complied with following the de novo. Before the conference could take place, Morgan’s counsel advised the Court that the case was settled and the discovery conference was vacated. Apparently the settlement, for unknown reasons, was never consummated. Thereafter a series of stops and starts by Morgan’s counsel, seeking to strike the Sands request for a trial de novo and filing a motion for summary judgment were made and denied by the District Court. The District Court thereafter set the matter for trial in the ordinary course of its business for January 2000, or some eight months beyond NRCP 41(e)’s five year prescriptive period. Morgan failed to object to the trial date and Morgan’s action was thereafter dismissed following the expiration of the time to bring a matter to trial under NRCP 41(e). In his appeal, Morgan argued that public policy considerations supported tolling of the prescriptive period because the parties were required to enter into the mandatory arbitration proceeding. Morgan pointed out that the Court has recognized two prior events which toll the prescriptive period, ie the time during which a medical malpractice case is pending before a medical screening panel and a case which involved a court ordered stay of district court proceedings. The Supreme Court, however, noted that Morgan had an affirmative duty to bring this matter to trial within the 5 year limitations. Morgan failed to avail himself of court procedures and rules designed to forward a case through the system, and in particular failed to comply with NRCP 16.1. Had Morgan done so, the Court concluded that this matter would have been placed upon the Court’s trial docket well within the prescriptive period and that no public policy considerations were involved because of Morgan’s failure to do so. The Court noted that a District Court is not compelled to monitor any case for a potential NRCP 41(e) problem. The Court further noted that District Courts in this state, when advised of a potential 41(e) problem, have accommodated the litigants in expediting the trial settings. With regard to Morgan’s contention that the arbitration award itself should be revised following dismissal under 41(e), the Court examined Nevada’s arbitration rules to conclude otherwise. The Court referenced that arbitrations are non-binding because of constitutional rights to a jury trial in civil cases. The Court found that awards from arbitrators, under the arbitration rules in the case before it, were sealed and the parties were required to proceed under NRCP 16.1 as though an arbitration had not occurred. The Court found the only exceptions would be if a request is stricken for failure to pay an arbitrators fees or to participate in the arbitration in good faith or to determine if sanctions were warranted for the requesting parties failure to improve on the award following trial. In concluding that the arbitration award would not be revived, the Supreme Court specifically noted that arbitration awards would never be revived absent the specific exceptions contained in the arbitration rules. The Supreme Court decision was not unanimous, with three judges dissenting. The dissent found this case to be analogous to a situation where a court had imposed a stay order and the Supreme Court tolled the running of the 5 year period under NRCP 41(e) because of the stay order. Citing from Boren v. City of North Las Vegas, 98 Nev. 5 (1982), the dissent found no distinction between that case and Morgan’s case. The dissent argued that public policy favored a trial on the merits and any time during which a party is prevented from obtaining a trial setting should toll the period under the 5 year rule and avoid the harsh result of a dismissal.
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