Nevada Appellate Court Summaries (1-7-22)

Check out these summaries of recent opinions from the Nevada Appellate Courts, as compiled by Joe Tommasino, Esq.

Supreme Court of Nevada

Civil procedure: NRS 52.380 violates the separation-of-powers doctrine because it is a procedural statute that conflicts with NRCP 35; thus, NRS 52.380 is unconstitutional. In 2019, the Supreme Court of Nevada amended NRCP 35, which governs mental and physical examinations of a party ordered during discovery in civil litigation. The Legislature subsequently enacted NRS 52.380, which also governs conditions for such examinations. The conditions imposed by NRS 52.380 differ from those imposed under NRCP 35, however. Specifically, the statute allows the examinee’s attorney to attend and make audio recordings of all physical and mental examinations, while NRCP 35 disallows observers at certain mental examinations, prohibits the examinee’s attorney from attending any examination, and allows audio recordings only upon a showing of good cause. In this opinion, the Court declared that “[t]he judiciary has the power to regulate court procedure, and the Legislature may not enact a procedural statute that would abrogate a preexisting court rule.” NRS 52.380 attempts to abrogate NRCP 35. By enacting the statute, the Legislature encroached on the inherent power of the judiciary. Thus, NRS 52.380 violates the separation-of-powers doctrine. Lyft, Inc. v. Dist. Ct. (Davis), 137 Nev. Adv. Op. No. 86, ___ P.3d ___ (December 30, 2021).

Class actions: Total damages sought by the class, rather than those sought by any individual class member, must be considered in determining whether the justice court has jurisdiction over a class action under NRS 4.370. The Supreme Court of Nevada overruled Castillo v. United Federal Credit Union, 134 Nev. 13, 409 P.3d 54 (2018), to the extent that it held to the contrary. The Court noted that the Castillo aggregation holding was in conflict with the newly amended NRCP 23(b), which expressly allows for aggregation of claims to establish district-court jurisdiction. The Castillo opinion also did not account for the purposes behind the jurisdictional threshold, and it failed to fully consider the impact of its decision on justice courts which are not equipped to adjudicate a large class action, with hundreds of plaintiffs and millions of dollars at stake. This opinion does not alter the approach to aggregation of claims in non-class actions. In non-class actions with multiple plaintiffs, each plaintiff must meet the statutory and constitutional requirements for the court to have subject matter jurisdiction over its claim. Moreover, nothing in this opinion prevents justice courts from hearing small class actions in which the total amount claimed does not exceed the jurisdictional threshold. Separately, the Court enumerated these factors for deciding whether severance is proper under NRCP 21:

(1) Whether the claims arise out of the same transaction or occurrence;

(2) Whether the claims present some common questions of law or fact;

(3) Whether settlement of the claims or judicial economy would be facilitated;

(4) Whether prejudice would be avoided if severance were granted; and

(5) Whether different witnesses and documentary proof are required for separate claims.

The trial court has broad discretion to sever the issues to be tried, and a court’s severance of claims will be reviewed for an abuse of discretion. A Cab, LLC. V. Murray, 137 Nev. Adv. Op. No. 84, ___ P.3d ___ (December 30, 2021).

Collections: (1) A plain reading of the “wildcard exemption” in NRS 21.090(1)(z) permits a debtor to exempt a portion of earnings up to $10,000 that does not already receive exempt status under the earnings exemption in NRS 21.090(1)(g); (2) the wildcard exemption permits a debtor to apply the exemption towards any personal property, the definition of which includes earnings, that remains subject to execution; and (3) because the earnings exemption designates a portion of earnings as subject to execution, the debtor can apply the wildcard provision to exempt up to $10,000 of the portion of her earnings not protected by the earnings exemption. The wildcard exemption refers to exempt and nonexempt personal property, as opposed to enumerated and unenumerated personal property, in describing its application. Nonexempt property signifies to the creditor that the property is attachable or available to satisfy a judgment. However, a property’s designation as “exempt” or “nonexempt” in NRS 21.090 does not depend solely on whether the statute enumerates such property because some types of property receive only partial-exemption status. The exemption statute enumerates earnings as a category of exempted property, but it does not provide a debtor with a complete exemption of those earnings because up to 25 percent of the debtor’s weekly earnings remains subject to execution. Thus, the wildcard exemption is available here to exempt up to $10,000 of the portion of earnings not exempted by the earnings exemption. The Supreme Court of Nevada further held that the use of the wildcard exemption on nonexempt earnings does not produce unreasonable or absurd results. Platte River Ins. Co. v. Jackson, 137 Nev. Adv. No. 82, ___ P.3d ___ (December 23, 2021).

Criminal procedure: (1) A trial court should not ignore a defendant’s lack of understanding about the charges and the potential sentences that becomes evident during a canvass under Faretta v. California, 422 U.S. 806 (1975); and (2) while no specific questions are required, the trial court should not disregard a defendant’s evident lack of understanding. A Faretta canvass must ensure that a defendant decides whether to waive counsel with eyes open. Here, because the trial court’s canvass did not ensure that the defendant understood the aggregate mandatory minimum sentence he potentially faced or the risks and disadvantages of waiving the right to counsel, the Supreme Court of Nevada reversed and remanded. The Court also observed that the trial court inappropriately disparaged the defendant’s choice to waive counsel during the canvass. Miles (Christian) v. State, 137 Nev. Adv. Op. No. 78, ___ P.3d ___ (December 23, 2021).

Deeds of trust: (1) Appellant purchased real property at a homeowner’s-association (HOA) foreclosure sale, taking that property subject to respondent’s deed of trust, and that deed of trust allows respondent to add any reasonable expenses incurred protecting its interest in the property, including attorney fees, to the secured debt; and (2) although a party seeking an award of attorney fees within the confines of a district-court case must comply with NRCP 54(d)(2)’s filing deadline, the deed of trust here entitled respondent to add the attorney fees it accrued in protecting its interest in the property to the secured debt without moving for those fees in court. Because appellant’s property is subject to the deed of trust, and because appellant sought to pay off the note secured by the deed of trust, the district court correctly found that respondent may add those attorney fees to the amount of indebtedness owed under the note secured by the deed of trust. Oella Ridge Tr. v. Silver State Sch. Credit Union, 137 Nev. Adv. Op. No. 80, ___ P.3d ___ (December 23, 2021).

Deeds of trust: In this case, U.S. Bank Trust recorded its assignment before it counterclaimed to quiet title, and because Daniel Lakes does not qualify as a subsequent purchaser under NRS 111.325, the district court properly concluded that U.S. Bank Trust may enforce its deed-of-trust lien in accordance with NRS 106.210. By statute, a homeowners’ association (HOA) obtains a lien afforded superpriority status for a portion of delinquent HOA assessments. When the HOA properly forecloses on that lien, it extinguishes the first deed of trust on the property. The first deed-of-trust beneficiary can protect its interest therein, however, by tendering the superpriority portion of the HOA’s lien before the foreclosure sale. While appellant Daniel Lakes questioned whether that happened here, the undisputed evidence confirms that it did, such that no issue of fact exists as to the first deed of trust’s survival. However, appellant also challenged the district court’s decision quieting title in favor of respondent U.S. Bank Trust, the first deed of trust holder, arguing that respondent cannot enforce its first-priority interest in the property because the assignment evidencing its status as the first deed-of-trust beneficiary was not recorded until after appellant recorded his grant, bargain, and sale deed showing the interest he obtained in the property from a successor in interest to the purchaser at the HOA’s foreclosure sale. However, the Supreme Court of Nevada disagreed. Appellant acquired only the interest in the property that was conveyed to him when he purchased it, and because of the superpriority tender, he took the property subject to the first deed-of-trust lien recorded years before the HOA foreclosure sale. The fact that the deed-of-trust assignment was recorded after appellant recorded his deed does not affect respondent’s right to enforce its lien because the assignment does not change the status of appellant’s title, which was always subordinate to the interest secured by the first deed of trust. Lakes v. U.S. Bank Tr., 137 Nev. Adv. Op. No. 85, ___ P.3d ___ (December 30, 2021).

Nevada’s “Dissenter’s Rights Statutes”: NRS 92A.400-.440 unambiguously provide that a beneficial stockholder “asserts” dissenter’s rights at step two of a four-step process and that the stockholder must provide the consent from his or her stockholder of record at that point. NRS 92A.300 through .500 are colloquially referred to as Nevada’s “Dissenter’s Rights Statutes.” They provide the framework by which stockholders of a corporation may dissent from certain actions the corporation plans to undertake, such as when the corporation plans to merge with another corporation. NRS 92A.410, .420, .430, and .440 generally set forth a four-step process by which a stockholder who objects to a proposed merger may seek the fair value of the stockholder’s shares from the corporation if the stockholder believes the proposed price for those shares, as set forth in the corporation’s proposed merger, is inadequate. In the event that a stockholder (the beneficial stockholder) owns his or her shares indirectly, such as through a brokerage firm (the stockholder of record), a fifth statute, NRS 92A.400(2)(a), requires the beneficial stockholder to obtain the stockholder of record’s consent before the beneficial stockholder may dissent from the merger. At issue here is when, in the four-step process, a beneficial stockholder must obtain the consent of the stockholder of record. The issue is governed by NRS 92A.400(2)(a), which provides that “[a] beneficial stockholder may assert dissenter’s rights as to shares held on his or her behalf only if the beneficial stockholder . . . [s]ubmits to the subject corporation the written consent of the stockholder of record to the dissent not later than the time the beneficial stockholder asserts dissenter’s rights.” In this opinion, the Supreme Court of Nevada held that “NRS 92A.400(2)(a), when read in conjunction with the four-step process outlined in NRS 92A.410-.440, unambiguously requires a beneficial holder to obtain the record holder’s consent at step two, which is before the vote on the merger is held.” Aerogrow Int’l, Inc. v. Dist. Ct. (Radoff), 137 Nev. Adv. Op. No. 76, ___ P.3d ___ (December 9, 2021).

Postconviction petitions: Various mandatory procedural bars foreclosed the appellant’s postconviction petition for a writ of habeas corpus, and he did not show good cause and prejudice to overcome those bars. Untimely claims about first postconviction counsel’s performance could not constitute good cause, and the appellant did not show good cause and prejudice based on the alleged ineffective assistance of second postconviction counsel, of which most instances were not adequately pleaded below or addressed in the appellate briefs. Finally, the appellant did not demonstrate that the failure to consider his petition would result in a fundamental miscarriage of justice, and the district court did not abuse its discretion in applying statutory laches. Therefore, the Supreme Court of Nevada affirmed the district court’s order dismissing the petition. Chappell (James) v. State (Death Penalty—PC), 137 Nev. Adv. Op. No. 83, ___ P.3d ___ (December 30, 2021).

Professional negligence: (1) NRS 41A.071 provides that “the district court shall dismiss” an action for professional negligence if the action is filed without the requisite affidavit from a medical expert; (2) NRS 41A.100(1)(a), however, allows an exemption from the medical-expert affidavit requirement when “[a] foreign substance other than medication or a prosthetic device was unintentionally left within the body of a patient following surgery”; (3) NRS 41A.100(1)(a) is not ambiguous, and “foreign substance” as used within this statute does not include bacteria; and (4) the related premises-liability claim sounds in medical malpractice and was also subject to the affidavit requirement. The term “foreign substance” in NRS 41A.100(1)(a) was intended to mean something that a doctor purposefully “implanted or used” during surgery that was then left in the body unintentionally. Bacteria falls into neither of these categories. Whether or not a bacterial infection existing in the body post-surgery was caused by a medical provider’s professional negligence is beyond the purview of the average person’s common knowledge, and thus it is outside the intended scope of the exceptions to the affidavit requirement. Thus, the district court was correct that the medical-malpractice claim in this case should have included a medical-expert affidavit and was therefore void ab initio. Montanez v. Sparks Family Hosp., Inc., 137 Nev. Adv. Op. No. 77, ___ P.3d ___ (December 9, 2021).

Public records: (1) The Nevada Public Records Act (NPRA) requires governmental bodies to make nonconfidential public records within their legal custody or control available to the public; (2) where a governmental body denies a public records request, the requester may apply to the court for an order compelling production; (3) if the requester prevails, the requester may recover costs and reasonable attorney fees; (4) under the “catalyst theory,” the requesting party may be able to recover attorney fees when the defendant changes its behavior because of and as sought by the litigation, even when the litigation does not result in a judicial decision on the merits; and (5) here, the district court misconstrued one of the factors in the catalyst-theory analysis and neglected to conduct more than a summary analysis of several other factors. In assessing whether a requester prevailed under the catalyst theory, the district court must consider the following factors:

(1) When the documents were released;

(2) What actually triggered the documents’ release;

(3) Whether the requester was entitled to the documents at an earlier time;

(4) Whether the litigation was frivolous, unreasonable, or groundless; and

(5) Whether the requester reasonably attempted to settle the matter short of litigation by notifying the governmental agency of its grievances and giving the agency an opportunity to supply the records within a reasonable time.

Consideration of these specific factors is mandatory. While the failure to enter explicit findings for each factor is not necessarily an abuse of discretion, specific findings are strongly encouraged, and the record must demonstrate that the district court properly considered each of the required factors. Las Vegas Review-Journal v. City of Henderson, 137 Nev. Adv. Op. No. 81, ___ P.3d ___ (December 23, 2021).

Sexual assault: (1) Appellant Gustavo Ramos was arrested and charged in 2010 for the sexual assault and murder of a woman 12 years earlier; (2) when the offenses were committed, the statute of limitations for the sexual-assault charge was 4 years unless the victim or a person authorized to act on the victim’s behalf filed a written report of the assault with law enforcement, in which case NRS 171.083(1) removed the statute of limitations; and (3) under the facts here—where the persons who discovered the victim’s body notified the police and law enforcement filed a written report concerning the sexual assault within the limitations period—the requirements of NRS 171.083(1) were satisfied, so there was no statutory time limit in which the State was required to file the sexual-assault charge. As to NRS 171.083(1)’s phrase “a person authorized to act on behalf of [the] victim,” the plain language contains no requirement that the victim give the person express authorization. Moreover, such a requirement would have the perverse effect of allowing the exception in NRS 171.083(1) to apply only when the victim survives and is able to disclose the sexual assault, and not when the victim is murdered during or immediately after the sexual assault. Thus, the Supreme Court of Nevada held that when the victim has been murdered, a person who discovers the victim’s body is “authorized” within the meaning of NRS 171.083(1) to report the crime on the victim’s behalf. Also, at Footnote 1, the Court noted that the statute of limitations for sexual assault was 4 years at the relevant time in this case. However, in 2015, the Legislature extended the limitations period to 20 years. The amendment did not apply here because the 4-year period expired in 2002. Ramos (Gustavo) v. State, 137 Nev. Adv. Op. No. 74, ___ P.3d ___ (December 9, 2021).

Torts: (1) Here, the Supreme Court of Nevada addressed the issue of whether a pet store may be held liable under tort law where a dog adopted at the store through an adoption event conducted by an independent charitable organization later attacks and injures an individual; and (2) the Court held that “as a pet store typically owes no duty to the individual in such circumstances, the store can be held liable only if it assumes a duty of care or has an agency relationship with the charitable organization that conducted the adoption event.” An indispensable predicate to tort liability founded upon negligence is the existence of a duty of care owed by the alleged wrongdoer to the person injured. The common law generally does not impose a duty of care to control the dangerous conduct of another or to warn others of the dangerous conduct. However, the Supreme Court has recognized a narrow exception to the general rule when a defendant assumes a duty of care owed by another to protect a third party. Here, nothing in the record suggests that the pet store knew about the dog’s aggressive tendencies, much less undertook affirmative steps to prevent the type of harm that ensued. In fact, the pet store expressly affirmed in its agreement with the charitable organization that the organization alone had control of which pets to present for adoption and was fully responsible for those animals. Petsmart, Inc. v. Dist. Ct. (Todd), 137 Nev. Adv. Op. No. 75, ___ P.3d ___ (December 9, 2021).

Workers’ compensation: (1) A claimant must file an application to reopen a claim within one year of the claim’s closing unless the injury incapacitated the claimant from earning “full wages” for a specified amount of time; and (2) respondent’s inability to earn overtime due to his industrial injury equates to being incapacitated from earning “full wages,” such that he can seek to reopen his claim more than one year after its closing. “[F]ull wages” as used in NRS 616C.400(1) is not defined in the workers’-compensation statutes or in the Nevada Administrative Code, and the phrase predates any available legislative history.However, the Supreme Court of Nevada concluded that “full wages” may include more than just an employee’s base pay. “Full wages” can also include overtime pay. City of Henderson v. Wolfgram, 137 Nev. Adv. Op. No. 79, ___ P.3d ___ (December 23, 2021).


About the author: Joe Tommasino has served as Staff Attorney for the Las Vegas Justice Court since 1996. Joe is the President of the Nevada Association for Court Career Advancement (NACCA).

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