Nevada Appellate Court Summaries (9-13-21)

By Joe Tommasino, Esq.

Supreme Court of Nevada

Torts: Under NRS 17.245(1)(a), a nonsettling defendant is entitled to an offset of the settlement proceeds from settling defendants when all defendants are held responsible under a strict-liability theory for the same injury. Dr. Kayvan Khiabani was riding a bicycle when he collided with a passing bus and was fatally injured. His estate and surviving family members, respondents in this appeal, sued several defendants, including appellant Motor Coach Industries, Inc. (MCI), the designer and manufacturer of the bus. Each defendant except MCI settled with respondents before trial. At trial, respondents argued that MCI was liable under theories of defective design and failure to warn. On appeal, the Supreme Court of Nevada addressed a variety of issues. First, the Court emphasized that those bringing a failure-to-warn claim must demonstrate the same elements as in other strict-product-liability cases. One must show that

  1. the product had a defect which rendered it unreasonably dangerous;
  2. the defect existed at the time the product left the manufacturer; and
  3. the defect caused the plaintiff’s injury.

In such cases, the lack of a warning functions as the relevant “defect.” Strict liability may be imposed even though the product is faultlessly made if it was unreasonably dangerous to place the product in the hands of the user without suitable and adequate warning concerning safe and proper use. The burden of proving causation can be satisfied in failure-to-warn cases by demonstrating that a different warning would have altered the way the plaintiff used the product or would have prompted the plaintiff to take precautions to avoid the injury. Plaintiffs do not need to provide the jury with a specific proposed warning in failure-to-warn cases. In typical design-defect cases, while a plaintiff may “bolster their case with evidence of an alternative design,” the Supreme Court has expressly rejected any requirement that the plaintiff do so, calling such a requirement “fundamentally unfair.” Similarly, failure-to-warn plaintiffs may–but need not–provide the jury with an alternative or additional warning.

Moreover, the fact that a potential collision between vehicles and bicyclists is a well-known danger does not mean respondents did not prove causation. It is true that Nevada law does not require manufacturers to warn against generally known dangers. But the danger alleged here was not as obvious as MCI suggested. The risk was not simply that the bus, like any bus, could strike a cyclist. Rather, the alleged risk was that air displacement caused by the particular shape of this bus could create a strong suction force while passing a cyclist. The district court correctly found that[e]ven if the evidence enabled this [c]ourt to find as a matter of law that [the bus driver] should have known generally of the ‘risk of driving next to a bicyclist,’ . . . no Nevada law holds that this would prevent a reasonable jury from finding that an adequate warning would have avoided the accident.” In sum,

respondents presented sufficient evidence for a reasonable jury to find that the failure to warn about air displacement’s effect on passing bicyclists caused the bicyclist’s injury. Second, NRS 41.085(4) permits heirs to recover damages for “loss of probable support” that would have been provided by the decedent. Heirs’ damages, based on the decedent’s lost earning capacity, may include present as well as future loss of support. The Supreme Court had not previously addressed whether juries should be informed of a decedent’s pretax income or post-tax income to calculate an award for loss of probable support under NRS 41.085(4). After looking to other jurisdictions, the Supreme Court concluded that a deceased person’s gross income is the most workable and realistic measure of what salary would be used to support the surviving family. All such loss-of-support awards are based on an unavoidably imperfect attempt to predict an alternate future where the decedent had lived, received pay, and used it to support his or her family. It is not practical to add conjecture regarding tax policy to that already tenuous counterfactual exercise. Accordingly, the Supreme Court concluded that the district court did not abuse its discretion in excluding evidence of the bicyclist’s net income. Third, Nevada allows juries to return special verdicts “in the form of a special written finding on each issue of fact.” The district court “must give the instructions and explanations necessary to enable the jury to make its findings on each submitted issue.” Special-verdict forms should be read in concert with jury instructions. Here, the jury instruction and verdict form, read together, were sufficient to ensure that the jury considered the question of causation for the failure-to-warn claim. Fourth, judgment “must not be entered” if the answers to special-verdict interrogatories are “inconsistent with each other and one or more is also inconsistent with [a] general verdict.” Courts must make an effort to harmonize seemingly inconsistent special verdict answers and must interpret them in a consistent way if possible. Here, no contradiction existed. As noted, failure-to-warn claims have the same elements as design-defect claims, but the “defect” is the lack of a warning rather than an issue with the product itself. The jury could have found that the air-blast effect itself caused by a speeding bus was not an unreasonably dangerous condition but that the lack of a warning nevertheless made the product unreasonably dangerous. Fifth, NRCP 59(a)(1)(D) provides that “the court may, on motion, grant a new trial” on the ground that there has been “newly discovered evidence material for the party making the motion that the party could not, with reasonable diligence, have discovered and produced at the trial.” Here, the “new” evidence pointed out by MCI likely could have been discovered with reasonable diligence before or during trial. Thus, the district court did not abuse its discretion in denying MCI’s motion for a new trial on this ground. Sixth, NRS 17.245(1)(a) provides, in relevant part, as follows:

“When a release or a covenant not to sue or not to enforce judgment is given in good faith to one of two or more persons liable in tort for the same injury or the same wrongful death . . . it reduces the claim against the others to the extent of any amount stipulated by the release or the covenant, or in the amount of the consideration paid for it, whichever is the greater.”

When considering whether NRS 17.245 applies in a given matter, “district courts must determine whether both the settling and the nonsettling defendants were responsible for the same injury.” Further, contribution and offset are distinct concepts, and eligibility for an offset should not be determined by whether the settling and nonsettling defendants were joint tortfeasors under NRS 17.225, which governs the right of contribution. Relevant to the instant case, nothing in NRS 17.245 suggests that lines should be drawn between defendants found strictly liable and other tortfeasors when both are responsible for the same injury. NRS 17.245 is clear on its face and applies to MCI, as there is no dispute that MCI and the other defendants were liable for the same injury. Further, the jury calculated the total damages for that single injury and respondents had already received partial payment from the settling defendants. MCI was therefore entitled to offset the judgment under NRS 17.245. To hold otherwise would permit double recovery by respondents for the same injury.

Accordingly, the district court should have granted MCI’s motion to alter or amend the judgment to offset the settlement proceeds paid by other defendants, so this case was remanded for calculation of the offset due. Finally, regarding expert-witness fees, NRS 18.005(5) generally caps such costs to not more than five expert witnesses in an amount of no more than $1,500 per witness and requires the district court to carefully evaluate a request for excess fees. In evaluating such a request, the court should consider several factors, including the importance of the expert’s testimony to the party’s case, the extent of the expert’s work, and whether the expert had to conduct independent investigations or testing. In its order on this issue, the district court cited these factors and respondents’ supporting documentation and taxed the entire amount requested for expert fees. The Supreme Court deferred to the district court’s decision because the district court did not abuse its discretion, particularly given the obvious importance of experts to the entirety of respondents’ claims.

Motor Coach Indus., Inc. v. Khiabani, 137 Nev. Adv. Op. No. 42, ___ P.3d ___ (August 19, 2021).

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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).