When Binding Arbitration in Nevada Is Not Binding

A lot of litigants (and attorneys, too) might be surprised to find out that a private binding arbitration award can still be appealed. The Nevada Supreme Court discusses this issue in a new case, Clark Cty. Educ. Ass'n v. Clark Cty. Sch. Dist.,122 Nev. Adv. Op. No. 30 (2006).

There, the Court clarifies the common-law grounds available for a court to review a private arbitration award. The Court had previously recognized that a private arbitration award may be reviewed under two common-law grounds: (1) the award is arbitrary, capricious, or unsupported by the arbitration agreement; or (2) the arbitrator manifestly disregarded the law. Under the first ground, the Court clarifies that the reviewing court may only concern itself with the arbitrator's findings and whether they are supported by substantial evidence or whether the subject matter of the arbitration is within the arbitration agreement. Under the second ground, the Court concludes that the reviewing court may only concern itself with whether the arbitrator knew of the law and, if so, consciously disregarded it, not whether the private arbitrator's interpretation of the law was correct.

Binding arbitration is not always the final step that many think it is.