News

Rivas case emphasizes need for clear language regarding mediation clauses

June 23, 2022

By Joseph H. Bucci, Esquire and Maya N. Rashid

In Rivas v. CBK Lodge General Partner, LLC, Ms. Rivas sued a waterpark for injuries she sustained while on a water slide at the waterpark. After a failed attempt at mediation with Ms. Rivas, the waterpark owner brought a third-party complaint against the water slide manufacturer seeking indemnification. The manufacturer sought dismissal of the third-party complaint pursuant to a mediation clause between the manufacturer and the waterpark. Specifically, the contractual provision required mediation of “any dispute . . . between the parties.” It further stated: “Mediation shall be conducted . . . under the Construction Industry Mediation Rules of the American Arbitration Association (“AAA”) by a mediator who is experienced and knowledgeable about the construction industry and construction contracts.”

The manufacturer argued that the provision encompassed third-party claims whereas the waterpark owner argued that the provision was limited to commercial disputes. Ultimately, the U.S. District Court for the Middle District of Pennsylvania granted the dismissal on the grounds that the mediation clause was “clear and unambiguous.” The court stated that had the parties intended to limit the scope of the clause, qualifying language should have been included.

The Rivas case emphasizes the importance of including clear dispute resolution clauses within your contracts that align with the intentions of the parties. Additionally, if it is the intention of the parties to limit the scope of those provisions, clear limiting language must be included. Lastly, the case demonstrates the favorable treatments Courts will give to mediation or alternate forms of dispute resolution to unclog their dockets.

If you need assistance with revising the language of your own contracts that have these types of clauses inserted or need a skilled AAA Mediator, contact me online or call (412) 338-1149 or at (724) 272-4204.