Thursday, June 27, 2013

Halcrow, Inc. v. Eighth Jud. Dist. Ct., 129 Nev. Adv. Op. 42 (June 27, 2013)

Before the Court En Banc. Opinion by Justice Saitta.
In this petition for writ of mandamus challenging a district court order granting motions for leave to amend to add claims for negligent misrepresentation against a design professional in the commercial construction context, the Court examined the economic loss doctrine’s applicability to negligent misrepresentation claims. The Court had previously left open the question of whether the economic loss doctrine barred a claim for negligent misrepresentation in Terracon Consultants Western, Inc. v. Mandala Resort Group, 125 Nev. 66, 206 P.3d 81 (2009). The original proceeding in this case stemmed from the construction of the Harmon Tower within CityCenter. The developer, MGM Mirage Design Group (“MGM”), retained an architectural firm and Perini Building Company (“Perini”) as its general contractor. The architectural firm retained the petitioner, Halcrow, to design the Harmon’s structure, and Perini hired Century Steel, Inc. (“Century”) to provide the steel installation, who ultimately assigned its assets to Pacific Coast Steel (“PCS”). Halcrow had no contract with Perini, Century, or PCS. After Perini filed a complaint against the MGM for failing to make timely payments, the MGM filed counterclaims against Perini for alleged reinforcing steel defects and other nonconforming work. Perini then filed a third-party complaint against Century and PCS, who in turn filed their own third and fourth party complaints against Halcrow, among others. Halcrow moved to dismiss Century’s third and fourth party complaints, arguing that Terracon bars unintentional tort claims against design professionals in commercial construction projects when the claimant incurs primarily economic losses. The district court dismissed Century’s and PCS’s claims for negligence, among others, but allowed Century and PCS leave to amend to allege a claim for negligent misrepresentation against Halcrow for allegedly negligently representing to Century and PCS that it would inspect and make on-site adjustments to the steel installation. The Court exercised its discretion to review this writ petition, and examined the economic loss doctrine’s application in Nevada. The Court clarified that there are certain exceptions to the economic loss doctrine where “strong countervailing considerations weigh in favor of imposing liability,” including claims for “defamation, intentionally caused harm, negligent misstatements about financial matters and loss of consortium.” However, the Court reasoned that in the context of commercial construction design professionals, contract law is better suited for resolving such claims. Therefore, the Court held that in commercial construction defect litigation, the economic loss doctrine applies to bar claims against design professionals for negligent misrepresentation where the damages alleged are purely economic. Writ of mandamus granted directing district court to vacate its order granting Century and PCS leave to amend. (Megan Starich, Associate in the Reno office of McDonald Carano Wilson LLP).

Thursday, June 20, 2013

Williams v. United Parcel Servs., 129 Nev. Adv. Op. 41 (June 6, 2013)

Before Justices Gibbons, Douglas, and Saitta. Opinion by Justice Saitta.
In this appeal from a district court order denying a petition for judicial review in a workers’ compensation action, the Court examined the meaning of “off work” under NRS 616C.390(5). Under NRS 616C.390(5), a claimant either has to be “off work” or has to receive a “permanent partial disability award” to reopen a claim more than one year after the closing date of the claim. Appellant sustained workplace injuries when he fell from a ladder and Appellant’s physician did not clear Appellant to return to work until two days later. Appellant filed a worker’s compensation claim with his employer and received an award that was not a “permanent partial disability award.” After experiencing subsequent back pain, appellant sought to reopen his claim two years after the claim closed. An appeals officer refused to reopen Appellant’s claim because the appeals officer determined that Appellant was never “off work” under NRS 616C.390(5). The appeals officer interpreted “off work” to mean that an employee has to miss at least five days of work as the result of a work injury. The Court first held that failing to apply to reopen a claim within the limitations period set forth in NRS 616C.390(5) acts as a jurisdictional bar to reopening the claim. The Court then held that an employee does not have to miss a certain minimum amount of time from work to be “off work” under NRS 616C.390(5) - an employee only has to lose time from work as the result of a work injury to be “off work” under the statute. Reversed and remanded. (Chris Stanko, Summer Clerk in the Reno office of McDonald Carano Wilson.)

Thursday, June 6, 2013

Bergenfield v. Bank of Am., 129 Nev. Adv. Op. 40 (June 6, 2013)

Before Justices Gibbons, Douglas, and Saitta. Opinion by Justice Douglas.
In this appeal, the Court held that in the context of Nevada’s Foreclosure Mediation Program, when the deed of trust to real property and the promissory note are held by two different entities at the time of mediation, the attendance at the mediation by the holder of a promissory note does not meet the statutory requirement that the deed of trust beneficiary attend and participate in good faith. Appellant obtained a home loan from Countrywide Home Loans, Inc. and executed a promissory note in Countrywide’s favor. The note was secured by a deed of trust naming Mortgage Electronic Registration Systems, Inc. as beneficiary of the deed of trust, who subsequently assigned its interest in the deed of trust to HSBC Bank USA. Countrywide endorsed the promissory note in blank, which meant that the holder of the note would be entitled to payment under the terms of the note. The Appellant defaulted on the loan and elected to participate in the Foreclosure Meditation Program. Bank of America, the acquirer of Countrywide, held the note and, through a representative, attended the mediation. HSBC did not attend at all. The Court held that a party seeking a nonjudicial foreclosure on a deed of trust of an owner-occupied residence must demonstrate that it is the current beneficiary of the deed of trust and the holder of the promissory note. This is because the deed of trust is a lien on the property, but the holder of the promissory note is the party entitled to repayment. Foreclosure under NRS Chapter 107 is only proper when the deed of trust and the promissory note are held by the same party. NRS 107.086(4) requires that the beneficiary of the deed of trust attend the mediation, and the Foreclosure Mediation Program certificate, which ultimately permits the beneficiary to proceed with foreclosure, cannot be issued if the beneficiary fails to attend. The deed of trust and the promissory note, therefore, must be reunified prior to the mediation. Because Bank of America was not the beneficiary of the deed of trust, it was not permitted to nonjudicially foreclose on the property. The Court further issued sanctions against Bank of America for holding itself out as the beneficiary of the deed of trust. Reversed. (Joseph Schrage, Associate in the Las Vegas office of McDonald Carano Wilson LLP.)