Delaware’s Revitalized Rule 16.1 Returns, Requiring Mandatory Non-Binding Arbitration at Election of Plaintiffs’ Counsel
In 2008, Delaware abolished Rule 16.1 of the Superior Court Rules of Civil Procedure, which provided an avenue for mandatory non-binding arbitration (“MNA”) for select civil cases that fell below a perceived value threshold of $100,000. The repeal date was effective March 3, 2008, and, for the past ten years, Superior Court practitioners typically proceeded to alternative dispute resolution (“ADR”) based on the terms of a trial scheduling order governing each particular action.
Just shy of ten years later, a committee with members from both sides of the bench and bar collaborated to revive Rule 16.1, and the new iteration of MNA effectively made its debut on January 1, 2018. Albeit similar to the past version of the Rule, the revived Rule 16.1 provides a relatively new framework for proceeding to mandatory non-binding arbitration within the Superior Court. Under Rule 16.1, MNA is available for those civil cases where (1) trial is available; (2) monetary damages are sought; (3) any nonmonetary claims are nominal; and (4) counsel for the claimant elects MNA on the civil case information sheet at the inception of the litigation.
In addition to the preliminary qualifications for the utilization of the Rule, it also provides for relatively strict filing requirements in order for a party to avail itself of MNA. Within five days of the filing of the defendant’s Entry of Appearance, the plaintiff must serve all Rule 3(h) medical records and accompanying reports on the defendant. Within five days of the filing of the Answer to the Complaint, the plaintiff must provide a HIPPA-compliant medical authorization, as well as provide all expert reports in existence at the time of the filing of the Complaint. Within 20 days of the close of initial pleadings, the Rule requires the parties to meet and confer to select an arbitrator. In the event an arbitrator is not selected within the prescribed 20-day time frame, the parties are not permitted to utilize Rule 16.1 MNA.
Other provisions of the Rule include the requirement that arbitration testimony must be under oath unless waived by the parties. Additionally, the arbitrator must file his or her written order within five days of the hearing. Following the filing of such order, either party is permitted 20 days to file a written demand for a trial de novo. The effect of such a filing essentially brings the case back to the same position as if MNA had not been elected; however, testimony from the MNA hearing may be utilized as if it were deposition testimony taken under oath. In the event the party requesting the trial de novo fails to obtain a verdict or judgment more favorable than the outcome of arbitration, that party shall be assessed the costs of arbitration in addition to the arbitrator’s total compensation. If the verdict is for the defense, defense costs may be assessed, whereas a plaintiff’s verdict would permit the assessment of interest on the judgment.
While the revitalized Rule 16.1 might prove to be a good vehicle to more quickly resolve relatively minor cases prior to the incurrence of more significant litigation costs, potential pitfalls remain. Rule 16.1 may be applied to cases where expert testimony is essential, but not required by the Rule, therefore resulting in a potentially superfluous step for cases that would most likely be returned to the court for a standard trial scheduling order on a request for a trial de novo. As the most recent iteration of the Rule only recently went into effect, the pitfalls and positives of the use of MNA will likely be forthcoming as more plaintiffs elect to proceed under Rule 16.1.
For more information about this article, please contact Noelle B. Torrice at 302.594.9780.