Thursday, May 30, 2013

In re Fox, 129 Nev. Adv. Op. 39 (May 30, 2013)

Before the Court en banc. Opinion by Justice Cherry.
In this opinion, the Court answered the following certified question from the United States Bankruptcy Appellate Panel of the Ninth Circuit: “[i]n Nevada may a judgment debtor claim exemptions under NRS 21.090 belonging not only to herself, but also to her non-debtor spouse?” The Court noted that, under NRS 21.090 (f) and (z), an individual can exempt one vehicle up to $15,000 in value and up to $1,000 in otherwise non-exempt personal property (the wildcard exemption). However, when a married couple files a joint bankruptcy petition, they may collectively exempt two vehicles and up to $2,000 in otherwise non-exempt personal property. In addressing this question, the Court recognized that whenever a married individual files for bankruptcy and his/her spouse does not join the petition, the bankruptcy estate includes all of the marital community property. Given the inclusion of all marital property in an individual debtor’s bankruptcy estate, the question before the Court was whether the debtor spouse is entitled to utilize the non-debtor spouse’s exemptions set forth in NRS 21.090(f) and (z) to allow for a total exemption of two vehicles and up to $2,000 in otherwise non-exempt personal property. In reviewing an Idaho bankruptcy court decision concerning the same issue and the plain language of the statute which refers only to the “judgment debtor’s equity” in such property, the Court concluded that a debtor in bankruptcy may not utilize his/her non-debtor spouse’s exemptions to exempt additional marital property from the estate. Thus, a married debtor whose spouse does not join in the bankruptcy petition may only exempt one vehicle and up to $1,000 in personal property not otherwise exempt. Based on the foregoing, the Court determined that a debtor is limited to one set of exemptions, as set forth in NRS 21.090, and she may not claim the exemptions belonging to her non-debtor spouse notwithstanding the fact that all marital community property is considered property of the estate. Certified question answered in the negative. (Amanda M. Perach, Associate in the Las Vegas office of McDonald Carano Wilson LLP.)

City of Sparks v. Sparks Mun. Court, 129 Nev. Adv. Op. 38 (May 30, 2013)

Before the Court En Banc. Opinion by Justice Hardesty.
In this appeal from a district court order granting a preliminary injunction, the Court considered 1) whether the City of Sparks could interfere with the Sparks Municipal Court’s control over its own personnel decisions, and 2) what, if any, influence the city may exert over the budget the city allocates to the court. The dispute arose when the Sparks City Council asked the Municipal Court to reduce the salaries of its court administrator and judicial assistant. After unsuccessful attempts to resolve the dispute via proposed amendments to the city charter, the Municipal Court filed a complaint with the district court for injunctive relief, which the district court granted, and the city subsequently appealed. With respect to the first issue, the Court examined Article 15, Section 11 of the Nevada Constitution, which permits a municipality to enact charter provisions governing the tenure and dismissal of any municipal “officer or employee.” Finding that Section 11 was ambiguous on its face, the Court looked past the plain language of the provision to the intent of the voters who approved the provision, and concluded that the provision was meant to apply only to officers, not employees. The Court then held that the city’s interference with the municipal court’s personnel decisions violated the separation of powers doctrine and infringed upon the inherent power of the judiciary to manage its internal affairs free from intrusion from any other branch of government. Regarding the second issue, however, the Court found that the parties had failed to develop the record sufficiently enough for the Court to rule. The Court reversed the district court’s ruling with respect to this issue and remanded the case for further proceedings to develop the record and determine whether any actual controversy still existed. In a separate opinion, Chief Justice Pickering concurred with the majority’s decision to reverse and remand, but dissented with respect to the majority’s decision to look past a plain reading of Section 11, which on its face clearly gives the city the authority to determine the terms of employment of the employees at issue in this case. Affirmed in part, reversed in part, and remanded. (Jeff S. Riesenmy, Associate in the Las Vegas office of McDonald Carano Wilson.)

Brown v. MHC Stagecoach, 129 Nev. Adv. Op. 37 (May 30, 2013)

Before the Court En Banc. Opinion by Justice Gibbons.
In this appeal, the Court held that it lacked jurisdiction to consider an appeal of an order that statistically closed a case. Appellant was a former employee of Respondent who alleged that discriminatory treatment resulted in her constructive termination. The parties negotiated a settlement agreement and the district court entered an order instantiating the terms of the settlement, but not entering a final judgment. Appellant subsequently refused to accept the settlement funds and contested the validity of the settlement. Thereafter, the district court entered a form order statistically closing the case on the basis that there had been a stipulated judgment and Appellant appealed this order. The Court recognized that it had appellate jurisdiction to review decisions of the district courts but only where the appeals are authorized by statute or court rule. The form order in question was not a final, appealable judgment under NRAP 3A(b)(1) because it did not resolve the underlying case or claims. There was also no other statute or court rule providing for the appeal of this type of an order. The Court explicitly noted that Appellant would be able to challenge a future judgment or order that finally adjudicated the rights of Appellant. Dismissed. (Adam Hosmer-Henner, Associate in the Reno office of McDonald Carano Wilson LLP.)

Bisch v. Las Vegas Metro. Police Dep't, 129 Nev. Adv. Op. 36 (May 30, 2013)

Before the Court en banc (Chief Justice Pickering recused). Opinion by Justice Parraguirre.
In this appeal of a district court order upholding a decision by the Employee Management Relations Board (EMRB), the Court considered whether, pursuant to NRS 289.080, the appellant, Laurie Bisch, was entitled to a police protective association (PPA) representative, in addition to her private attorney, during an internal investigation interview. Secondarily, the Court considered whether Bisch’s ultimate discipline -- a formal written reprimand for violation of “conduct unbecoming an employee” -- was based on overly broad criteria, or was politically motivated because it was known that Bisch intended to run for Sheriff. The underlying investigation by LVMPD arose from a complaint filed by the mother of a 17-year-old friend of Bisch’s daughter that alleged Bisch committed insurance fraud when Bisch misrepresented the 17-year-old’s identity to a medical facility after a dog bite. LVMPD internal affairs opened an investigation, but determined that Bisch did not commit insurance fraud because she did not use her employer-provided health care insurance, instead paying for the medical care out-of-pocket. Internal affairs contacted the district attorney’s office to inquire whether Bisch violated any other laws; the district attorney indicated that Bisch may have committed identity theft. Although a LVMPD sergeant eventually recommended that the complaint against Bisch be dropped, LVMPD later decided the complaint would stand on grounds that the conduct was unbecoming an employee. On appeal, the Court noted that the interpretation of NRS 289.080 regarding any duty owed by a PPA is an issue of first impression. The Court held that NRS 289.080 does not impose an affirmative duty on a PPA to provide two representatives, only that an officer has a right to have two representatives. The Court further held that the protections of NRS 289.080 only exist between an officer and his/her employer; it does not govern a PPA’s responsibility towards its members. Next, the Court rejected Bisch’s claim that her discipline was improper because untruthfulness bore on her fitness to perform her profession, and protecting the integrity of the police department is a legitimate basis for imposing discipline. Finally, applying the burden shifting framework articulated in Reno Police Protective Ass’n v. City of Reno, 102 Nev. 98, 715 P.2d 1321 (1986), and adopting the revised framework in Director, OWCP v. Greenwich Collieries, 512 U.S. 267, 276-78 (1994), the Court found that EMRB’s conclusions that Bisch established a prima facie case of discrimination, LVMPD established a nondiscriminatory reason for discipline, and that Bisch was unable to overcome her burden to demonstrate that LVMPD’s stated reasons were merely pretextual, were supported by substantial evidence. Affirmed. (Kristen T. Gallagher, Associate in the Las Vegas office of McDonald Carano Wilson.)

Cucinotta v. Deloitte & Touche, L.L.P., 129 Nev. Adv. Op. 35 (May 30, 2013)

Before the Court En Banc. Opinion by Justice Cherry.
In this appeal, the Court considered whether information divulged by a registered accounting firm in accordance with the Securities Exchange Act of 1934 is subject to an absolute privilege in a defamation action. The Court answered in the affirmative, holding that such a firm should be encouraged to freely disseminate information concerning alleged illegal acts so long as the disclosure is made pursuant to federal securities law and made to the appropriate level of management. Respondents served as independent auditors for the Appellants’ employer, a company that supplied cash access services to the gaming industry. Respondents discovered information about alleged illegal acts committed by the Appellants and Appellants’ employer. The Respondents then communicated the allegations to the Audit Committee of the Appellants’ employer. The employer conducted an internal investigation and found no evidence of wrongdoing by the Appellants or the company; shortly thereafter, however, the Appellants resigned from the Board of Directors and filed a defamation complaint against the Respondents. The Court adopted section 592A of the Restatement (Second) of Torts, holding that those who are required by law to publish defamatory statements are absolutely privileged in making such statements provided that the communications are made (1) pursuant to a lawful process and (2) to a qualified person. Thus, because the Respondents had made the potentially defamatory statements “in the discharge of a duty under express authority” of federal securities law, and because those statements were made to the employer’s Audit Committee (a qualified person under federal securities law), Respondents were entitled to absolute privilege. Affirmed. Rory T. Kay, Associate in the Las Vegas office of McDonald Carano Wilson LLP).

Chapman v. Deutsche Bank Nat'l Trust Co., 129 Nev. Adv. Op. 34 (May 30, 2013)

Before the Court En Banc. Opinion by Chief Justice Pickering.
In this matter, in which the Ninth Circuit Court of Appeals certified two questions to the Nevada Supreme Court, the Court considered whether the following actions are properly characterized as proceedings in personam (in which a judgment acts only upon the parties to the suit), in rem (a proceeding taken directly against property, in which a judgment applies against the entire world), or quasi in rem (a proceeding to determine rights in certain property; i.e., “a halfway house between in rem and in personam proceedings): 1) a quiet title action under NRS 40.010, which is premised on an allegedly invalid trustee’s sale under NRS 107.080(5)(a); and 2) an unlawful detainer action under NRS 40.255(1)(c). The Court concluded that a quiet title action is “predominately in rem or quasi in rem,” because its primary purpose was to establish title to real property. In so holding, the Court rejected Deutsche Bank’s argument that a quiet title action in which the plaintiff also seeks monetary damages changes the nature of the proceeding to an in personam proceeding. The Court also concluded that although an unlawful detainer action “does not adjudicate title or an absolute right to possession of property,” an unlawful detainer action is nevertheless a proceeding in rem or quasi in rem because its purpose is to determine rights to possession – a lesser property interest than title, but a property interest nonetheless – as between a plaintiff and a defendant. Having so concluded, the Court answered the certified questions in the affirmative. (Patrick J. Murch, Associate in the Las Vegas office of McDonald Carano Wilson.)

Thursday, May 16, 2013

Galardi v. Naples Polaris, LLC, 129 Nev. Adv. Op. 33 (May 16, 2013)

Before Chief Justice Pickering, Justices Hardesty and Saitta. Opinion by Chief Justice Pickering.
In this appeal, the court examined Nevada law on contract interpretation in determining whether a real estate option contract required the buyer or the seller to remove an encumbrance on the property subject to the contract upon the sale. At issue on appeal was whether the district court properly considered evidence of trade usage to determine that the contract was unambiguous and, therefore, exclude parol evidence. The Court adopted the modern standard regarding trade usage and held that ambiguity in a contract is not required before evidence of trade usage or custom can be used to ascertain or illuminate contract terms. Applying this principle, the Court found that the district court properly deemed an expert’s affidavit regarding trade usage admissible and that the option contract was unambiguous in light of the trade usages established by the expert affidavit. The Court further determined that the seller’s deposition testimony regarding his subjective understanding of the contract’s terms was inadmissible under the parol evidence rule because it contradicted the contract’s express terms, and that the testimony was not relevant to contradict the expert’s testimony on industry usage and custom. Because the seller’s testimony was either inadmissible or irrelevant or both, the Court held it was insufficient to create a genuine issue of material fact to defeat summary judgment, affirming the district court’s grant of summary judgment. Affirmed. (Megan Starich, Associate in the Reno office of McDonald Carano Wilson LLP.)

Thursday, May 2, 2013

City of Las Vegas v. Evans, 129 Nev. Adv. Op. 31 (May 2, 2013)

Before Justices Gibbons, Douglas, and Saitta. Opinion by Justice Saitta.
In this appeal from a denial of a petition for judicial review in a workers’ compensation matter, the Court considered two issues: (1) whether a firefighter could still seek workers’ compensation benefits without obtaining the benefit of a specific rebuttable presumption provided by NRS 617.453; and (2) whether substantial evidence supported an appeals officer’s decision that a firefighter’s cancer was a compensable occupational disease. NRS 617.440 outlines the requirements for proving a compensable occupational disease and NRS 617.358(1) requires that an employee prove “by a preponderance of the evidence that the employee’s occupational disease arose out of and in the scope of his or her employment.” These two provisions, however, do not apply to claims filed under NRS 617.453, which establishes a conditional rebuttable presumption that a firefighter’s cancer arose out of his or her employment if he or she has been employed as a firefighter full-time for five or more years. The Court analyzed the relationship between these statutes and concluded that when a workers' compensation claimant fails to meet a condition necessary to receive the benefit of the presumption set forth in NRS 617.453, this results in only the loss of the presumption and does not preclude the claimant from obtaining compensation under the more general statutory requirements. In this case, the employee had only been employed as a full-time firefighter for four years. Even though he was not entitled to the rebuttable presumption of NRS 617.453, he could still obtain compensation by demonstrating the disease arose out of and in the scope of his employment. The court further held that substantial evidence supported the appeals officer’s conclusion that the employee’s cancer was a compensable occupational disease. Affirmed. (Seth T. Floyd, Associate in the Las Vegas office of McDonald Carano Wilson).

Jacinto v. PennyMac Corp., 129 Nev. Adv. Op. 32 (May 2, 2013)

Before Justices Gibbons, Douglas, and Saitta. Opinion by Justice Douglas.
In this appeal from a petition for judicial review of a foreclosure mediation, the Court considered whether a homeowner who obtained some relief but not all the requested relief is an aggrieved party with standing to appeal. Under a NRAP 3A, to have standing to appeal, a party must be “aggrieved”, meaning adversely and substantially affected by a challenged judgment. In this opinion, the Court makes clear that a party who receives an order granting some requested relief but denying other relief may be considered aggrieved under NRAP 3A. Addressing the substance of the appeal, the Court held that the district court did not abuse its discretion when it granted only monetary sanctions for the lender’s failure to comply with the foreclosure mediation rules. Affirmed. (Kerry S. Doyle, Associate in the Reno office of McDonald Carano Wilson.)

Sylver v. Regents Bank, N.A., 129 Nev. Adv. Op. 30 (May 2, 2013)

Before Justices Hardesty, Parraguirre, and Cherry. Opinion by Justice Parraguirre.
In this appeal, the Court announced a standard for determining if an arbitration award was obtained through undue means, and addressed whether an arbitrator manifestly disregarded the law by refusing to void a loan transaction. Respondent bank obtained an arbitration award against appellant borrower. In obtaining the award, Respondent used deposition testimony for a key witness whom Respondent represented was unavailable to appear at the arbitration hearing. Both parties examined the witness at a deposition. When Respondent filed a motion in district court to confirm the arbitration award, Appellant offered evidence that Respondent had misrepresented the unavailability of the witness, who actually would have been available and willing to appear at the arbitration hearing. The district court confirmed the award. Appellant challenged the award on appeal, arguing that the award had been obtained using undue means. The Court interpreted the meaning of “undue means” in NRS 38.241 to comport with the federal standard providing that the challenging party faces the burden of establishing by clear and convincing evidence that the other party obtained the award by engaging in intentional misconduct that could not have been discovered with the exercise of due diligence. The Court held that (1) Respondent’s representation about the witness, even if incorrect, did not rise to the level of corruption or fraud required to establish undue mean; (2) the witness’s availability was discoverable through due diligence; and (3) appellant showed no causal connection between the award and the alleged misrepresentation. The second issue on appeal was whether the arbitrator manifestly disregarded the law in refusing to void one of the subject loans, on the grounds that Respondent had never sought a certificate of exemption before engaging in mortgage banking, as required by NRS 645E.910. The arbitrator had noted the failure to obtain a certificate, but recognizing that no civil remedy existed for this statutory violation, held that the unintentional violation had no materiality to the parties’ dispute. On appeal, the court noted that the “manifest disregard” standard does not inquire whether the arbitrator incorrectly interpreted the law, but whether the arbitrator, knowing the law required a particular result, simply disregarded it. Appellant did not meet this “very high hurdle.” The court declined to address the issue of whether the failure to comply with a licensing requirement renders a contract unenforceable, because the operative standard of review in the case did not entail plenary judiciary review. Affirmed. (Mark W. Dunagan, Associate in the Reno office of McDonald Carano Wilson.)