131 Nev., Advance Opinion go 

IN THE SUPREME COURT OF THE STATE OF NEVADA 

WPH ARCHITECTURE, INC., A 

NEVADA CORPORATION, 

Appellant, 

vs. 

VEGAS VP, LP, A NEVADA LIMITED 

PARTNERSHIP, 

Respondent. 

Appeal from a district court order denying a motion to confirm 

in part, modify, or correct an arbitration award. Eighth Judicial District 

Court, Clark County; Jessie Elizabeth Walsh, Judge. 

Affirmed. 

Weil & Drage, APC, and Jean A. Weil and Trevor 0. Resurreccion, 

Henderson, 

for Appellant. 

Greenberg Traurig and Tami D. Cowden and Mark E. Ferrario, Las Vegas, 

for Respondent. 

BEFORE SAITTA, GIBBONS and PICKERING, JJ. 

OPINION 

By the Court, SAITTA, J.: 

In Nevada, it is well settled that a party who makes an 

unimproved upon offer of judgment in a district court action may recover 
attorney fees and costs incurred after the offer of judgment was made. 

This opinion addresses whether this is also true when the statutory offer 

of judgment takes place in an arbitration proceeding. 

We hold that because the award of fees and costs by an 

arbitrator is discretionary, appellant WPH Architecture, Inc., has not 

demonstrated that the arbitrator manifestly disregarded Nevada law by 

refusing to award it fees and costs. 

FACTUAL AND PROCEDURAL HISTORY 

Respondent Vegas VP, LP, hired WPH to perform 

architectural services for a condominium project that Vegas VP was 

building in Las Vegas. Vegas VP brought an action against WPH for 

professional negligence relating to the services that WPH performed for 

Vegas VP. The contract provided that any disagreement between Vegas 

VP and WPH would be resolved by mediation and, if that were 

unsuccessful, binding arbitration before the American Arbitration 

Association (AAA). 

After an unsuccessful attempt at mediation, Vegas VP filed a 

demand for arbitration. Prior to arbitration, WPH submitted what it 

claimed to be two statutory offers of judgment under NRCP 68 and NRS 

17.115 to Vegas VP. 1Vegas VP did not accept either offer. 

The case proceeded to arbitration, and an AAA panel of 

arbitrators ruled in favor of WPH. The arbitration order also stated that 

1NRS 17.115 was repealed by the 2015 Nevada Legislature. 2015 

Nev. Stat., ch. 442, § , at ; A.B. 69, 78th Leg. (Nev. 2015). Because 

NRS 17.115 was still in effect at the time of the arbitration, its subsequent 

repeal does not affect our disposition in this case. 

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each party would bear its own fees and costs. WPH then filed a postaward motion for costs, fees, and interest, claiming that as the prevailing 

party it was entitled to fees and costs under Nevada law. The arbitration 

panel denied WPH's motion, stating that no caselaw existed which held 

that offers of judgment are available in arbitration proceedings in Nevada. 

Therefore, "[w]ithout express authority to grant fees and costs incidental 

to a declined offer of judgment, [the arbitration] Panel [was] disinclined to 

rule in favor of WPH." 

WPH subsequently filed a motion in the district court to 

confirm in part, modify, or correct the arbitration award to order Vegas VP 

to pay WPH's attorney fees, costs, and interest. The district court denied 

WPH's motion. This appeal follows. 

DISCUSSION 

WPH argues that because the arbitration panel manifestly 

disregarded Nevada law regarding the awarding of attorney fees and 

costs, the district court erred in denying WPH's motion to confirm in part, 

modify, or correct the arbitration award. Specifically, WPH argues that 

the arbitration panel disregarded NRCP 68 and NRS 17.115, which 

provide for a party who makes an offer of judgment that its adversary does 

not improve upon to recover the reasonable attorney fees and costs it 

incurs, see NRCP 68(f)(2); NRS 17.115(4)(c)-(d), and NRS 18.020, which 

requires costs to be awarded to the prevailing party in an action alleging 

more than $2,500 in damages, see NRS 18.020(3). 

"We review a district court's confirmation of an arbitration 

award de novo." Sylver v. Regents Bank, N.A., 129 Nev., Adv. Op. 30, 300 

P.3d 718, 721 (2013). An arbitration award "may be vacated based on 

statutory grounds and certain limited common-law grounds." Bohlmann 

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v. Printz, 120 Nev. 543, 546, 96 P.3d 1155, 1157 (2004), overruled on other 

grounds by Bass-Davis v. Davis, 122 Nev. 442, 452 n.32, 134 P.3d 103, 109 

n.32 (2006). At common law, "an arbitration award may be vacated if it is 

'arbitrary, capricious, or unsupported by the agreement' or when an 

arbitrator has 'manifestly disregard[ed] the law." Id. (alteration in 

original) (quoting Wichinsky v. Mosa, 109 Nev. 84, 89-90, 847 P.2d 727, 

731 (1993)). 

The arbitration was substantively governed by Nevada law 

WPH argues that the contract between it and Vegas VP 

contained a choice-of-law agreement stating that any arbitration arising 

from the contract would be substantively governed by Nevada law. Vegas 

VP argues that the contract contained a choice-of-law agreement stating 

that the arbitration would be substantively governed by AAA rules. 

Contract interpretation is reviewed de novo. Bielar v. Washoe Health Sys., 

Inc., 129 Nev., Adv. Op. 49, 306 P.3d 360, 364 (2013). 

The contract between Vegas VP and WPH contains two choiceof-law clauses. The first clause (AAA rules clause), found under the 

contract's "Arbitration" section, states that the arbitration, "unless the 

parties mutually agree otherwise, shall be in accordance with the 

Construction Industry Arbitration Rules of the [AAA]." The second clause 

(Nevada laws clause), found in the contract's "Miscellaneous Provisions" 

section, states that the contract itself would be "governed by the law of the 

principal place of business of the Architect, unless otherwise provided." 

The principle place of business of WPH is Nevada. 

The United States Supreme Court has ruled on this issue in a 

case with facts very similar to the current case. In Mastrobuono V. 

Shearson Lehman Hutton, Inc., two parties disputed how a choice-of-law 

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provision applied to their arbitration. 514 U.S. 52, 53 (1995). The 

contract governing the parties' dispute had both a clause stating that "any 

controversy' arising out of the transactions between the parties 'shall be 

settled by arbitration' in accordance with the rules of the National 

Association of Securities Dealers (NASD)" and a clause stating that "the 

entire agreement 'shall be governed by the laws of the State of New York." 

Id. at 58-59. The Court reasoned that reading the agreement as choosing 

New York law to apply for both the procedural and substantive law 

governing the arbitration would violate a "cardinal principle of contract 

construction: that a document should be read to give effect to all its 

provisions and to render them consistent with each other." Id. at 63. 

Thus, the Court found that "the best way to harmonize the choice-of-law 

provision with the arbitration provision is to read the laws of the State of 

New York to encompass substantive principles" and the NASD rules to 

govern the procedural aspect of the arbitration. Id. at 63-64 (internal 

quotations omitted). 

Similar to Mastrobuono, a finding here that the Nevada law 

clause supersedes the AAA rules clause would require this court to violate 

a well-established tenet of contract interpretation by rendering the AAA 

rules clause meaningless. See Bielar, 129 Nev., Adv. Op. 49, 306 P.3d at 

364 (holding that this court interprets a contract so as to give effect to 

each of its words and to not render any terms meaningless). We also find 

that such a finding would not express the parties' intentions when they 

entered into the Agreement. See Galardi v. Naples Polaris, LLC, 129 

Nev., Adv. Op. 33, 301 P.3d 364, 367 (2013) ("Contract interpretation 

strives to discern and give effect to the parties' intended meaning."). The 

parties' extensively blacked out portions of the contract, which was 

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originally a boilerplate architecture agreement entitled "Abbreviated 

Standard Form of Agreement Between Owner and Architect." By blacking 

out portions of the contract, the parties indicated that they did not intend 

for those portions to be part of the contract. Yet the AAA rules clause was 

not similarly repudiated, indicating that the parties intended for that 

clause to be included in the contract. Therefore, we hold that the 

arbitration was substantively governed by Nevada law and procedurally 

governed by the AAA rules. 

NRCP 68, NRS 17.115, and NRS 18.020 are substantive laws 

Vegas VP argues that this court previously held attorney fees 

to be procedural in Tipton v. Heeren, 109 Nev. 920, 859 P.2d 465 (1993). 

In Tipton, the court stated in a footnote that it agreed with the parties' 

assessment that under a choice-of-law provision in a promissory note, 

Wyoming law would govern substantive issues and Nevada law would 

govern procedural issues. Id. at 922 n.3, 859 P.2d at 466 n.3. The court 

then, without making an express finding or performing any analysis on 

the issue of whether attorney fees is a procedural issue, applied Nevada 

law to the issue of attorney fees. Id. at 924, 859 P.2d at 467. Because the 

court in Tipton did not analyze the issue of whether attorney fees statutes 

are substantive law, we hold that Tipton is not controlling in this case. 

Thus, the issue of whether attorney fees laws are procedural or 

substantive is one of first impression. 

Federal courts have found state laws awarding attorney fees 

to be substantive. For example, the Ninth Circuit Court of Appeals has 

stated that "[s]tate laws awarding attorney[ ] fees are generally considered 

to be substantive laws." Northon v. Rule, 637 F.3d 937, 938 (9th Cir. 

2011). Indeed, federal district courts in Nevada have found NRCP 68, 

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NRS 17.115, and NRS 18.020 to all be substantive laws. See Walsh v. 

Kelly, 203 F.R.D. 597, 598-99 (D. Nev. 2001) (holding that NRCP 68 and 

NRS 17.115 are substantive laws); see also In re USA Commercial Mortg. 

Co., 802 F. Supp. 2d 1147, 1178 (D. Nev. 2011) (holding NRS 18.020 to be 

a substantive law). 

We see no reason to disagree with the federal courts on this 

issue. Therefore, we hold that NRCP 68, NRS 17.115, and NRS 18.020 are 

substantive laws that apply to the arbitration proceedings in the current 

case. 

The award of attorney fees and costs is discretionary by an arbitrator 

It is well settled that NRCP 68 and NRS 17.115 provide that 

attorney fees and costs may be awarded when a party fails to improve 

upon a rejected statutory offer of judgment in an action before the district 

court. See RTTC Commc'ns, LLC v. Saratoga Flier, Inc., 121 Nev. 34, 40- 

41, 110 P.3d 24, 28 (2005). We have similarly ruled that NRS 18.020 

requires the award of costs to the prevailing party in several types of 

district court actions. See Schwartz v. Estate of Greenspun, 110 Nev. 1042, 

1050, 881 P.2d 638, 643 (1994); see also Campbell v. Campbell, 101 Nev. 

380, 383, 705 P.2d 154, 156 (1985). However, we have never ruled as to 

whether the statutes or the rule create a similar requirement when a 

dispute is decided in private arbitration proceedings. 

NRCP 68 and NRS 117.115 contain no references to 

arbitration, awards, or arbitrators. Similarly, NRS 18.020 also contains 

no reference to arbitration proceedings. Therefore, NRCP 68, NRS 17.115, 

and NRS 18.020(3) by their plain language do not expressly require the 

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award of fees and costs in an arbitration proceeding. 2Furthermore, no 

Nevada caselaw exists holding that those statutes apply to arbitration 

proceedings. Therefore, we conclude that these statutes do not require an 

arbitrator to award attorney fees or costs. 

NRS 38.238(1) states that "[am n arbitrator may award 

reasonable attorney's fees and other reasonable expenses of arbitration if 

such an award is authorized by law in a civil action involving the same 

claim or by the agreement of the parties to the arbitral proceeding." WPH 

argues that because NRS 38.238(1) expressly allows an arbitrator to 

award any attorney fees and costs that would be authorized by law in a 

civil action involving the same claim, the AAA panel was therefore 

required to award attorney fees and costs mandated by NRCP 68, NRS 

17.115, and NRS 18.020. However, in making its argument, WPH ignores 

the operative word in NRS 38.238(1): that "[a]n arbitrator may award" 

fees and costs. (Emphasis added.) Thus, the statute merely gives an 

arbitrator the discretion to award fees; it is not a requirement to do so. 

See NRS 0.025(1)(a) ("May' confers a right, privilege or power."); see also 

Tarango v. State Indus. Ins. Sys., 117 Nev. 444, 451 n.20, 25 P.3d 175, 180 

n.20 (2001) ("In statutes, 'may' is permissive and 'shall' is mandatory 

unless the statute demands a different construction to carry out the clear 

intent of the legislature." (internal quotations omitted)). 

2E1 contrast, California's offer of judgment statute explicitly states 

that it applies to both trial and arbitration proceedings. See Cal. Civ. 

Proc. Code § 998 (West 2009). 

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WPH has not shown that the AAA panel manifestly disregarded Nevada 

law 

In determining whether an arbitrator has manifestly 

disregarded the law, "the issue is not whether the arbitrator correctly 

interpreted the law, but whether the arbitrator, knowing the law and 

recognizing that the law required a particular result, simply disregarded 

the law." Clark Cnty. Educ. Ass'n v. Clark Cnty. Sch. Dist., 122 Nev. 337, 

342, 131 P.3d 5, 8 (2006) (internal quotations omitted). 

Here, the arbitration panel considered whether Nevada's offer 

of judgment and costs statutes required the award of fees and costs in an 

arbitration proceeding before finding that no judicial or statutory 

authority mandated such an award. The arbitration panel also considered 

whether it had the authority under AAA rules to grant post-award fees 

and costs incidental to a declined offer of judgment, and it concluded that 

AAA rules did not grant that authority. 

As discussed above, NRCP 68, NRS 17.115, and NRS 18.020(3) 

do not by their plain language require the award of fees and costs in an 

arbitration proceeding. Furthermore, no Nevada caselaw exists holding 

that those statutes apply to arbitration proceedings. Lastly, NRS 

38.238(1) provides an arbitrator with the discretion to award attorney fees 

and costs in an arbitration proceeding but does not require the arbitrator 

to do so. Therefore, no clear statute or authority exists that would require 

the award of attorney fees and costs in an arbitration proceeding. As such, 

WPH has not demonstrated that the arbitration panel knew of any statute 

or authority that required the panel to award attorney fees and costs to 

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Gibbons 

WPH. We therefore hold that WPH has failed to demonstrate that the 

arbitrator manifestly disregarded Nevada law. 

CONCLUSION 

Because the award of fees and costs by an arbitrator is 

discretionary, WPH has not demonstrated that the AAA panel manifestly 

disregarded Nevada law when it refused to award them to WPH. Thus, 

we affirm the district court's denial of WPH's motion to confirm in part, 

modify, or correct the arbitration award. 

Saitta 

J 

10 
PICKERING, J., concurring: 

I concur but only in the result. The arbitrators considered and 

rejected the limited arguments the appellant made to them to support its 

post-award request for attorney fees and costs. Those arguments did not 

include the choice-of-law and Erie-based substance v. procedure 

distinctions on which the majority focuses. Since no authority was cited to 

the arbitrators to suggest, much less establish, that NRS 17.115 and 

NRCP 68 apply in the arbitration setting, the arbitrators did not act in 

manifest disregard of law in declining to award fees and costs based on 

those provisions of Nevada law. See Graber v. Comstock Bank, 111 Nev. 

1421, 1428, 905 P.2d 1112, 1116 (1995) ("[When searching for a manifest 

disregard for the law, a court should attempt to locate arbitrators who 

appreciate the significance of clearly governing legal principles but decide 

to ignore or pay no attention to those principles."). The record before the 

arbitrators likewise does not establish appellant's entitlement to costs 

pursuant to "NRS 18.010, et. seq.," to which appellant generically referred 

the arbitrators. While I would affirm, therefore, I would do so on the 

grounds that the arbitrators did not manifestly disregard the law that was 

presented to them, without reaching the more complex and uncertain 

questions the majority undertakes to resolve. 

Pida2,1 my' 

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