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Failure to Mediate Bars Claim for Unpaid Wages

The Supreme Court of Virginia has affirmed the dismissal of a suit for unpaid wages because of the plaintiff’s failure to seek mediation before filing suit.   In Primov v. Serco, Inc., the Court upheld the Circuit Court of Fairfax County’s dismissal of a  complaint with prejudice upon sustaining a plea in bar for failure to comply with a contractual condition precedent before filing suit.

In Primov, the plaintiff alleged that he had an employment agreement with his employer, Serco, that required he be paid a 35% “hardship uplift”  because he was deployed to work in Afghanistan.  Primov alleged that Serco paid him only a 15% hardship uplift, and did not pay the uplift on his overtime.  He filed suit alleging a breach of his employment agreement and seeking $61,014.80 in damages.

The employment agreement included  a Mediation Provision which states:

The parties shall attempt in good faith to resolve any dispute arising out of or relating to this Agreement promptly by confidential mediation. If the dispute has not been resolved by mediation within 60 days of a written request to mediate made by one of the parties, then either party may bring suit in the state or federal courts located in Fairfax County, Virginia.

Primov filed his first suit for breach of the employment agreement on September 30, 2015.  Despite the language of the Mediation Provision, he did not request mediation before filing suit.  Serco responded by sending letters and emails demanding that Primov take a nonsuit  because he failed to first seek mediation.  On February 1, 2016, Primov sent Serco a letter stating he “would not be opposed to pursuing a mediation concurrently with the court proceedings, so long as Mr. Primov does not have to incur any portion of the expense related to the process.” On August 16, 2016 — the day trial was set to begin — Primov took a voluntary nonsuit.

On December 14, 2016, Primov filed a second breach of contract claim against Serco in the Circuit Court for Fairfax County. Once again, he alleged a breach of his employment agreement arising out of the failure to pay all of the hardship uplift he claimed to be entitled too.  On March 24, 2017, Serco filed a plea in bar to the complaint.  In the plea in bar, Serco alleged that, pursuant to the Mediation Provision, a written request to mediate was a condition precedent to initiating a legal action. After conducting a hearing, the Circuit Court ruled that the Mediation Provision was, in fact, a condition precedent to filing suit, and that Primov has failed to satisfy this condition.   The Circuit Court reasoned that Primov’s February 1, 2016 letter expressing a willingness to mediate under certain conditions did not satisfy the condition precedent because it was not an actual request to mediate. On July 19, 2017, the Circuit Court entered an order sustaining the plea in bar and dismissing the complaint with prejudice.

On appeal, the Supreme Court of Virginia addressed one assignment of error:  was it appropriate for the Circuit Court to dismiss the suit with prejudice instead of without prejudice?   Although the Supreme Court acknowledged that dismissal with prejudice is a harsh penalty for non-compliance with the Mediation Provision, it was not  a “clear error of judgment” for the Circuit Court to do so in this case.   The Court noted that Primov had the opportunity to fully litigate his case in the first lawsuit, but opted instead to take a voluntary nonsuit on the date of trial. The Court further noted that Primov was made aware of the Mediation Provision four months after he filed the first lawsuit, but still never requested mediation despite continuing to litigate the first case for five additional months and then filing the second lawsuit just four months after taking the nonsuit.

The Supreme Court’s Primov decision is encouraging for all parties to employment contracts.  The ruling demonstrates the Court’s willingness to hold parties to the terms of their agreed-upon bargain and to require that those who chose to flagrantly disregard their contractual obligations be required to suffer the consequences.

 

 

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