When a dispute arises, parties to a contract generally look for ways to stay out of court if they can. Including a clause requiring mediation before litigation is one way to accomplish that goal. This kind of clause can make good business sense: after all, being warned of a dispute and having the chance to try and resolve it in mediation is usually preferable to being served with a summons and a copy of a complaint. Plus, a successful mediation is faster and cheaper than litigation and often more private. But what happens if a party fails to honor a prelawsuit mediation requirement and instead runs directly to court? Most lawyers’ instinctive answer would be that the court should simply dismiss the lawsuit without question, but getting that dismissal in some circumstances can be more difficult than anticipated.
In both federal and state courts, enforcing a prelitigation mediation requirement that is part of an arbitration clause is simple and straightforward. In federal court, the defendant would file either a petition to compel mediation and arbitration pursuant to Section 4 of the Federal Arbitration Act (FAA), or a motion to stay the litigation pending mediation and arbitration pursuant to Section 3 of the FAA. Similarly, in state court, the defendant would move to compel mediation and arbitration, or to stay pending mediation and arbitration pursuant to the Connecticut Arbitration Act and the FAA.
