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Nevada Appellate Court Summaries (3-9-23)

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

Written by Joe Tommasino, Esq.

Supreme Court of Nevada

Criminal procedure: Under NRS 201.230 and NRS 62B.390, juvenile courts have the discretion to certify minors who commit lewd acts for criminal proceedings as adults. In 2015, the Legislature amended the statute criminalizing lewdness with a child, NRS 201.230, by redefining the crime based on the ages of the perpetrator and the victim. Under these amendments, if the victim is under the age of 14, the crime constitutes a category A felony, unless an exception applies. Relevant here, an exception to the category A felony designation exists for perpetrators under the age of 18 and recognizes the act as delinquent, rather than criminal, in those circumstances. Here, Appellant argued that, based on this exception, any defendant under the age of 18 charged with lewdness with a child must necessarily be tried as a juvenile. The Supreme Court of Nevada disagreed. The Court clarified that “nothing in the amendment to NRS 201.230 limited the juvenile court’s authority to certify a juvenile defendant charged with violating NRS 201.230 to be tried as an adult.” In re: B.J.W.-A., 139 Nev. Adv. Op. No. 1, ___ P.3d ___ (January 12, 2023).

Disqualification: Supreme Court Rule (SCR) 48.1 governs peremptory challenges of judges, and a specific rule interpretation applies to consolidated cases. First, SCR 48.1(1) says that even consolidated cases have only two sides. This language necessarily means that when cases are consolidated, the second case becomes part of the first case. Second, if one side in consolidated cases waives their right to a peremptory challenge, that waiver bars any subsequent peremptory challenges from the same side. Third, parties are entitled to an additional peremptory challenge under SCR 48.1(9) if their case is reassigned. An “action” in the context of consolidated cases under SCR 48.1(9) means the same thing as an action in the context of consolidated cases under SCR 48.1(1). As a result, the focus is on whether the first case is reassigned to a different judge. The transfer of the second case to the judge hearing the first case as a result of consolidation does not trigger SCR 48.1(9) because the first case before and after consolidation remains before the same judge. In other words, “when a second case is transferred as a result of consolidation to be heard with the first, . . . there is no ‘reassignment’ at all because the second case is already considered part of the first case and the first case remains before the same judge before and after consolidation.” Consequently, parties in consolidated cases are entitled to an additional peremptory challenge under SCR 48.1(9) only if the first case is reassigned, not when the second case is transferred to be heard with the first. Reggio v. Eighth Jud. Dist. Ct., 139 Nev. Adv. Op. No. 4, ___ P.3d ___ (March 9, 2023).

Insurance: (1) The Nevada Division of Insurance (the Division) promulgated a regulation, R087-20, prohibiting insurers from adversely using consumer-credit-information changes that occurred during the governor’s COVID-19 emergency declaration, plus two years; and (2) the Division had the statutory and constitutional authority to promulgate R087-20. The Nevada Insurance Code permits insurers to use consumer-credit information when underwriting and rating personal property and casualty insurance, subject to restrictions designed to ensure the use of this information is fair and not discriminatory. The governor’s COVID-19 declaration of emergency led to mass unemployment across Nevada and a corresponding decline in consumer-credit scores. After investigation, the Division determined that it was unfair and actuarially unsound for insurers to use credit-score declines against insureds who lost their jobs due to the pandemic, through no fault of their own. The Division thus promulgated R087-20 to prohibit insurers from adversely using consumer-credit-information changes that occurred during the governor’s COVID-19 emergency declaration, plus two years. Appellant National Association of Mutual Insurance Companies (NAMIC) is a private, nonprofit insurance trade association whose members include insurers that use consumer-credit information to underwrite and rate personal home and auto insurance in Nevada. On behalf of itself and its members, NAMIC opposed the Division’s adoption of R087-20 and sued to invalidate the regulation after it passed. On appeal, the Supreme Court of Nevada held that NAMIC had representational standing to challenge R087-20 on behalf of its members. The Court then focused on the regulation’s validity. The Court found that R087-20 does not conflict with applicable statutes, and “[t]he Division acted within the province of its authority when it found that using consumer credit scores against insureds during the pandemic and its aftermath would result in unfair actuarial discrimination.” NAMIC v. State, Div. of Ins., 139 Nev. Adv. Op. No. 3, ___ P.3d ___ (February 16, 2023).

Lis pendens: (1) The plain language of NRS 14.010(1) does not limit a lis pendens to actions in which the plaintiff claims an ownership or possessory interest in the property; and (2) a fraudulent-transfer claim seeking avoidance of the transfer of real property is one “affecting the title or possession of real property” under NRS 14.010(1) and thus supports a lis pendens.

NRS 14.010(1) permits a party to an “action … affecting the title or possession of real property” to record a “notice of the pendency of the action,” commonly referred to as a “lis pendens.” In construing this provision in Levinson v. Eighth Judicial District Court, the Supreme Court of Nevada stated that a party who records a lis pendens must have some claim of entitlement to the property. 109 Nev. 747, 752, 857 P.2d 18, 21 (1993). Here, the Court considered whether a creditor’s claim seeking avoidance of a fraudulent transfer of real property under Nevada’s Uniform Fraudulent Transfer Act (UFTA) may support the recording of a lis pendens even though the creditor does not claim an interest in the property but instead seeks to transfer title back to the debtor. A lis pendens serves as constructive notice to potential purchasers or lenders that the real property described in the lis pendens is the subject of a pending lawsuit. A lis pendens may be recorded by a party “[i]n an action … affecting the title or possession of real property.” After a lis pendens is recorded, the property owner may move to expunge the lis pendens pursuant to NRS 14.015. To maintain the lis pendens, the party who recorded it has the burden of establishing, among other things, that the lis pendens is proper and that the party is likely to prevail in the action and as a result will be entitled “to relief affecting the title or possession of the real property.” If the party fails to meet its burden, the district court must order the lis pendens expunged. The central question here was whether a claim of fraudulent transfer “affect[s] the title or possession of real property” within the meaning of NRS 14.010(1). A fraudulent-transfer claim under Nevada’s Uniform Fraudulent Transfer Act (UFTA) is a claim by a creditor that a debtor transferred property with the intent to defraud the creditor by placing the property out of the creditor’s reach.The UFTA sets forth remedies for a fraudulent transfer, one of which is the “[a]voidance of the transfer … to the extent necessary to satisfy the creditor’s claim.” When a creditor seeks this statutory remedy of avoidance, the district court may void the transfer of title to the property and return title to the debtor. This transfer of title back to the debtor necessarily affects the title of the property. The Court concluded that a fraudulent-transfer action seeking avoidance of a transfer of real property constitutes an action “affecting the title or possession of real property” within the meaning of NRS 14.010(1). Thus, the Court disavowed Levinson to the extent it suggested that a lis pendens must be grounded in a claim of ownership or possessory interest in the real property. Tahican, LLC v. Eighth Jud. Dist. Ct., 139 Nev. Adv. Op. No. 2, ___ P.3d ___ (February 2, 2023).

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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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