Case Title: AA Primo Builders v. Washington

Citation: 126 Nev. Adv. Op. No. 53

Docket Number: 

State: nevada

Court: Nevada Supreme Court

Date: 2010-12-30T00:00:00Z

Document:
126 Nev., Advance Opinion 53
IN THE SUPREME COURT OF THE STATE OF NEVADA

AA PRIMO BUILDERS, LLC, A No, 53983
NEVADA LIMITED LIABILITY |

COMPANY, | Fi L E D

Appellant,
vs. | bee 3.92010

BERTRAL WASHINGTON AND CHERI spe Joc

WASHINGTON, os

Respondents. "Bape Serum ot

‘AA PRIMO BUILDERS, LLC, A No. 64471
NEVADA LIMITED LIABILITY
COMPANY,

Appellant,

vs.
BERTRAL WASHINGTON AND CHERT
WASHINGTON,

Respondents.

 

 

Consolidated appeals from a district court order granting
summary judgment and dismissing all claims and counterclaims and from
 post-judgment order awarding attorney fees and costs, Eighth Judicial
District Court, Clark County; Jessie Elizabeth Walsh, Judge.

Reversed and remanded.

Gibbs, Giden, Locher, Turner & Senet LLP and Becky A. Pintar, Las

Vegas,
for Appellant.

Henness & Haight and Michael D. Haight and Jay A. Kenyon, Las Vegas,
for Respondents.

 

BEFORE HARDESTY, DOUGLAS and PICKERING, JJ.

one 10-3408

 

 
 

en

 

OPINION

By the Court, PICKERING, J.:

Appellant AA Primo Builder
suit to recover money allegedly due from respondents Bertral and Cheri
Washington on a 2005 patio remodel job. The dismissal came in 2009,

LLC appeals the dismissal of its

 

more than three years into the litigation. It was based on the Secretary of
State having revoked AA Primo’s charter to do business as a Nevada
limited liability company, effective December 1, 2008. AA Primo asked the
district court for a stay to give it time to make the annual filings needed to
reinstate its charter, but the district court refused, instead granting the
Washingtons’ summary judgment motion. AA Primo next filed a timely
motion under NRCP 59 asking the district court to vacate the judgment of
dismissal, because by then it had succeeded in reinstating its charter.
Again, the district court refused relief, and it also awarded the
Washingtons their fees and costs. This appeal followed.

We reverse. Dismissal was too harsh a penalty for AA Primo's
default in annual fees and filings due the Secretary of State.
Administrative revocation of a domestic limited liability company’s charter
suspends the entity's right to transact business, not its ability to prosecute
an ongoing suit. See NRS 86.274(5); NRS 86.505. Under NRS 86.276(5),
moreover, reinstatement retroactively restores the entity's right to
transact business; it is “as if such right had at all times remained in full
force and effect.” Thus, AA Primo’s suit should not have been dismissed
and, having been dismissed, should have been reinstated once AA Primo’s
charter was. Finally, before dismissal, the district court should have given
AA Primo the brief stay it requested to seek charter reinstatement.

 
L

Before the merits, we must address the Washingtons’
threshold challenge to the timeliness of AA Primo’s appeal and, hence, our
jurisdiction. AA Primo did not file its notice of appeal until the district
court denied its “motion to amend order,” asking to vacate the judgment of
dismissal and reinstate the suit based on its reinstated charter. If AA
Primo’s “motion to amend” qualified as “a motion under Rule 59{(e)] to
alter or amend the judgment,” it tolled the time to file the notice of appeal,
and AA’s appeal is timely. NRAP 4(a)(4)(C). If AA Primo’s motion did not
qualify as an NRCP 59() tolling motion, the notice of appeal was

"The district court addressed AA Primo’s lapsed charter in the
context of the Washingtons’ motion for summary judgment under NRCP
56. It concluded that AA Primo lacked “standing,” requiring
“DISMISS[AL] without prejudice” of its suit. AA Primo’s lapsed charter
properly raised an issue of capacity, not standing, see In re Krause, 546
P.3d 1070, 1072 n.2 (9th Cir. 2008), and we question whether the issue
‘would not more properly have been addressed under NRCP 17 (addressing
the capacity of parties to sue or be sued) or NRCP 25 (addressing the
substitution of parties in the event of death, incompetency, or transfer of
interest) than by a “dismissal without prejudice” under NRCP 56, See
Bader Enterprises, Inc. v. Olsen, 98 Nev. 381, 384-85, 649 P.2d 1369, 1371
(1982) (applying NRCP 17(b) to resolve a challenge to a foreign
corporation's capacity to litigate), overruled on other grounds by Executive
Mgmt. v. Ticor Title Ins. Co., 118 Nev. 46, 50 n.8, 38 P.3d 872, 874 n.8
(2002); compare Robt. Pierce Co, v. Sherman Gardens, 82 Nev. 395, 400-
01, 419 P.2d 781, 784-85 (1966) (approving proceeding by way of
“suggestion of corporate dissolution”), with Payne v. Security Savs. & Loan
Ass'n, E.A., 924 F.2d 109 (7th Cir. 1991) (applying the federal counterpart
to NRCP 25(c) to substitute a dissolved corporation's successor in interest).
See also NRCP 17(a) (providing for a reasonable time after objection for
the joinder or substitution of the real party in interest similar to procedure

approved in Executive Management).

 

 

 
ome
—

untimely, and we lack jurisdiction. See NRCP 4(a)(1) (“Except as provided
in [NRAP] 4(@)(4), a notice of appeal must be filed... no later than 30
days after [service of] written notice of entry of the judgment or order
appealed from”).

An NRCP 59(e) motion doos not have to win on the merits to
have tolling effect under NRAP 4(a)(4)(C). ‘The formal requirements are
minimal, “A motion to alter or amend the judgment [must] be filed no
later than 10 days after service of written notice of entry of the judgment.”
NRCP 59(@). It must also satisfy NRCP 7(b) and be “in writing, ... state
with particularity [its] grounds [and] set forth the relief or order sought.”
See United Pac. Ins, Co, v. St. Denis, 81 Nev. 103, 106-07, 399 P.2d 135,
187 (1966) (citing NRCP 7(b) and NRCP 59(e)); see Elustra v. Mineo, 595
F.3d 699, 707-08 (7th Cir. 2010) (a single-sentence motion meeting Fed. R.
Civ. P. 7's requirements and asking to vacate a judgment qualified as
tolling under the federal counterparts to NRCP 59 and NRAP 4(a)(4)(C).
But beyond this, NRCP 59(e) does not impose limits on its scope

NRCP 59(¢) and NRAP 4(a)(4)(C) echo Fed, R. Civ. P. 59(@)
and Fed. R. App. P. 4(a)(4)(A)(v), and we may consult federal law in
interpreting them. See Coury v, Robison. 115 Nev. 84, 91 n.4, 976 P.2d
518, 522 nf (1999). Because its terms are so general, Federal Rule 59(e)
“has been interpreted as permitting a motion to vacate a judgment rather
than merely amend it,” 11 C. Wright, A. Miller & M. Kane, Federal
Practice and Procedure § 2810.1, at 119 (2d ed. 1995), and as “coverfing] a
broad range of motions, [with] the only real limitation on the type of
motion permitted [being] that it must request a substantive alteration of

the judgment, not merely correction of a clerical error, or relief of a type
wholly collateral to the judgment.” Id, at 121 (citing Osterneck v, Ernst &

 

 
Whinney, 489 U.S. 169 (1989); Buchanan v, Stanships, Inc,, 485 U.S. 265
(1988), Among the “basic grounds” for a Rule 59(e) motion are
“eorrect{ing] manifest errors of law or fact,” “newly discovered or
previously unavailable evidence,” the need “to prevent manifest injustice,”
or a “change in controlling law.” Id, at 124-27.

By these standards, AA Primo's post-judgment “motion to
amend order” qualifies as an NRCP 59(e) motion to alter or amend
judgment with tolling effect under NRAP 4(a)(4)(C). The motion was in
writing, invoked NRCP 69, asked to vacate the judgment of dismissal, and
appended proof that the charter, for want of which AA Primo’s suit was
lost, had been restored. It urged the district court to consider NRS
86.276(5), which provides that reinstatement of an administratively

 

revoked charter “relates back to the date on which the company forfeited
ite right to transact business . .. as if such right had at all times remained
in full force and effect.” And it argued that NRS 86.276(5) and AA Primo’s
reinstated charter provided a “compelling legal basis... to amend” the
judgment and avoid “manifest injustice.”

It is hard to imagine a post-judgment motion that would
qualify for tolling under NRCP 59(e) and NRAP 4(a)(4)(C) if AA Primo’s
did not. Nonetheless, the Washingtons dispute whether, as “a thinly-

 

veiled motion for reconsideration,” the motion tolled for AA Primo. As
support, they quote the last sentence of local EDCR 2,24(b), which
provides, “A motion for reconsideration does not toll the 30-day period for

filing a notice of appeal from a final order or judgment.” But the
Washingtons’ own authority defeats them. ‘They ignore the first sentence
of EDCR 2.240), which restricts the “motion(s] for reconsideration” the
rule covers to motions “seeking reconsideration of a ruling of the court,

 

 
ome

 

other than any order which may be addressed by motion pursuant to
NRCP 50(b), 52(b). 59 or 60.” (Emphasis added.) Thus, by its terms,
EDCR 2.24(b) excludes motions for reconsideration under NRCP 59(e) and
has no effect on NRAP 4(a)(4)(C). Indeed, as a local district court rule it
could not be otherwise, since NRCP 83 prohibits local rules that are
tent with the NRCP, while NRCP 81(a) provides that the NRAP

 

incon:

 

govern “[a]ppeals from a district court to the Supreme Court of Nevada.”
‘The Washingtons’ argument does find a foothold, however, in
the Nevada cases opining that a motion for reconsideration, even though
timely seeking substantive alteration of a judgment, may not qualify as an
NRCP 59(e) tolling motion. Compare Able Electric, Inc, v. Kaufman, 104
Nev, 29, 31-32, 752 P.2d 218, 220 (1988) (We are not persuaded by
[respondent's] attempt to convert [appellant's] motion to alter or amend
into a non-tolling motion for rehearing”; oddly basing this determination
on the fact that “(t]he district court did not consider any new evidence in
arriving at its decision to deny [appellant's] motion to alter or amend),
with Alvis v. State, Gaming Control Bd., 99 Nev. 184, 186 n.1, 660 P.2d
980, 981 n.1 (1983) (‘A review of the [post-judgment] motion . . . reveals
that [appellant] merely sought reconsideration of the district court's
earlier order dismissing the petition for judicial review. It cannot
reasonably be construed as a motion to alter or amend the judgment
pursuant to NRCP 59(e)."); see Nardozzi v. Clark Co, School Dist.. 108
Nev. 7, 8 n.1, 823 P.2d 285, 286 n.1 (1992) (citing Alvis, 99 Nev. at 186 n.1,
660 P.2d at 981 n.1, and enlarging its holding to this: “A motion for
rehearing cannot reasonably be construed as a motion to alter or amend
the judgment pursuant to Rule 59(¢).”). But these cases do not explain the
features that distinguish a motion to alter or amend from one to

 
reconsider a judgment, much less the rationale for the distinction, And
tracing the cases back to their source, Whitehead v. Norman Kave Real
Estate, 80 Nev. 383, 395 P.2d 829 (1964), cited in Alvis, 99 Nev. at 186 n.1,
660 P.2d at 981 n.1, only adds to the mystery, because in Whitehead,
NRCP 59(e) was neither argued nor addressed; both Whitehead and its
follow-along case, Arrate v. Nevada National Bank, 89 Nev. 55, 56, 506
P.2d 86, 86 (1973), concerned the predecessor to local EDCR 2.24(b),
discussed above, and its relationship to then-NRCP 73(a), a predecessor to
NRAP 4. See Whitehead, 80 Nev. at 384-85, 395 P.2d at 329-30; Arrate,
89 Nov. at 56, 506 P.2d at 86 (citing Whitehead).

‘To some extent, the

 

istinction may have been result-driven,
spurred by the desire to save an appellant who filed the notice of appeal
too early or too late for jurisdiction to attach under the unforgiving
appellate rules formerly in place, Until we adopted what is now NRAP
4(@)(6) a party who filed a notice of appeal before decision of a tolling
motion needed to file a second notice of appeal once the motion was
decided; if this wasn’t done, the notice of appeal was untimely unless the
post-judgment motion was deemed nontolling. See Nardozzi, 108 Nev. at
8 n.1, 823 P.2d at 286 n.1. On the other hand, a party who waite to file

  

the notice of appeal until a post-judgment motion is decided risks being too

 

2NRAP 4(a)(6) provides in pertinent part that “[a] premature notice
of appeal does not divest the district court of jurisdiction” and that, unless
‘the premature appeal has already been dismissed, a premature “notice of
»peal shalll be considered filed on the date of and after entry of the order,
judgment or written disposition of the last-remaining [tolling] motion.”

 

 

 
late if the motion turns out to be nontolling. See Able Electric, 104 Nev. at
81-32, 752 P.2d at 220 (citing Alvis, 99 Nev. 184, 660 P.2d 980). See also
Averhart v, Arrendondo, 778 F.2d 919, 920-21 (7th Cir, 1985) (discussing
the pre-amendment confusion with respect to Fed. R. Civ. P. 59 and Fed.
R. App. P. 4(a)(4) and noting that “unless a litigant has a pretty good
understanding of how Rule 69 of the procedure rules interacts with Rule 4
ipt to fall into the same hole into which [the
appellant in that case] disappeared"); 16A C. Wright, A. Miller, E. Cooper
& C. Struve, supra, § 3950.4, at 392-96 (discussing the liberalizing
amendments to Fed. R. Civ. P59 and Fed. R. App. P. 4(a)).

of the appellate rules, he

 

Although the distinction between motions to reconsider and
motions to alter or amend may have once afforded flexibility, today it
serves no purpose except to put an appellant who misjudges which
category a post-judgment motion falls into at risk. “In order to avoid
confusion, and to prevent harsh results for unwary parties,” courts
elsewhere, interpreting state and federal rule cognates to NRCP 59(e) and
NRAP 4(a)(4)(C), “have generally held that, regardless of its label, .... a
motion to reconsider, vacate, set aside, or reargue [a final judgment] will
ordinarily be construed as [a] Rule 59(e) motion{] if made within ten days
of entry of judgment.” Lieving v. Hadley, 423 S.E.2d 600, 603 (W. Va.
1992) (quoting GA James W. Moore & Jo D. Lucas, Moore's Federal
Practice { 59.12{1] at 59-265 (June 1989), abrogated on other grounds by
Walker v. Doe, 558 $.E.2d 290 (W. Va. 2001)); Bowen v. El. duPont de
Nemours and Co,, 879 A.2d 920, 921-22 (Del. 2005) (recognizing a motion
for reargument as a motion to alter or amend under Delaware Rule 59(e)
with tolling effect); Anderson v. Oceanic Properties, Inc,, 650 P.2d 612, 616

(Haw. Ct. App. 1982) (2 motion for reconsideration of a judgment qualifies

 

 
a8 a motion to alter or amend under Hawaii Rule 59(e) and has tolling
effect); see 11 C. Wright, A. Miller & M. Kane, supra, § 2810.1, at 122 n.8
(collecting cases holding that Rule 59(e) encompasses motions for
reconsideration of a judgment).

To continue to maintain our arcane, occasionally treacherous
distinction between motions to alter or amend a judgment, which toll, and
and motions to reconsider a judgment, which do not, is not only contrary to
settled law elsewhere, it is antithetical to Winston Products Co. v. DeBoer,
122 Nev. 517, 134 P.3d 726 (2006). In Winston Products, we declared as
an overarching rule that “[olur interpretation of [modern] NRAP 4(a)(4)
tolling motions should reflect our intent to preserve a simple and efficient
procedure for filing a notice of appeal” and “not be used as a technical trap
for the unwary draftsman.” Id, at 526, 134 P.3d at 732 (quotation omitted),

 

Accordingly, we hold that so long as a post-judgment motion for
reconsideration is in writing, timely filed, states its grounds with
particularity, and “request[s] a substantive alteration of the judgment, not
merely the correction of a clerical error, or relief of a type wholly collateral
to the judgment,” 11 C, Wright, A. Miller & M. Kane, supra, § 2810.1, at
121, there is no reason to deny it NRCP 59(e) status, with tolling effect
under NRAP 4(a)(4)(C). To the extent Whitehead, Alvis, and their

linston Products and

 

progeny hold differently, they are abrogated by Wi
therefore disapproved.
We thus reject the Washingtons’ challenge to our jurisdiction
and now turn to the merits.
nL
‘The substantive question on this appeal is whether a Nevada

limited liability company whose charter is revoked, then reinstated, may

 

 
litigate a pending suit to conclusion, The answer is yes, for three
separate, independently sufficient reasons, First, the right to “transact
business” that is forfeited on charter revocation does not normally include
an LLC's capacity to sue and be sued. Second, reinstatement restores the
entity's capacity to conduct itself as a limited liability company
retroactively to the date of revocation; this includes the right to litigate

pending

 

es to conclusion. Finally, dismissal should not be ordered in
cases of this kind without giving the entity a brief stay, if requested, to
pursue reinstatement of its charter.
A

AA Primo was formed under NRS Chapter 86 in 2001 and
continuously maintained itself as
good standing until December 1, 2008, when the Secretary of State
deemed it in default of its annual fee and filing obligations under NRS
86.263 for the preceding year. NRS 86.274(2) states the consequence of
being deemed in this kind of administrative default: “the charter of the
company is revoked and its right to transact business is forfeited.”

(Emphasis added.) But Chapter 86 does not define “transact business.”

 

domestic limited liability company in

Applying the novo review appropriate to questions of entity capacity,
Executive Memt. v. Ticor Title Ins. Co,, 118 Nev. 46, 49, 38 P.3d 872, 874
(2002), we thus must decide whether the “right to transact business” that

a Nevada limited liability company forfeits when its charter is revoked
includes the ability to sue and be sued.

‘The Ninth Circuit Court of Appeals certified a variant of this
question to us in In re Krause, 546 F.3d 1070 (9th Cir. 2008), which
involved a domestic corporation that lost its charter and its right to

 

 
“transact business” under Nevada's similarly worded corporations code
provision, NRS 78.175(2). (The certified question went unanswered
because the parties stipulated to dismiss the suit, In re Krause, Docket
No. 52578 (Order Dismissing NRAP 5 Proceeding, May 26, 2009).) In
framing the question, the Ninth Circuit noted dictionary definitions of

 

“business” (‘a usually commercial or mercantile activity engaged in as a
means of livelihood”) and “transact” (‘to carry on the operation or
management of’), and concluded that the phrase “transact business” in

NRS 78.175(2) was certifiably ambiguous:

 

Some corporations are primarily in _ the
business of collecting debts and/or filing
lawsuits. But most corporations are primarily
engaged in some other business... The term
“transact business” probably could —_ be
construed to include pursuing litigation...

 

Nevertheless, ... we cannot conclude that it must
necessarily be so construed.
Krause, 546 F.3d at 1075 (quoting Merriam-Webster’s Collegiate

Dictionary 167, 1327 (11th ed. 2005)) (footnote omitted)

AA Primo’s business is construction, not litigation. It
comprises two members, a husband and wife, who formed the entity to do
‘small residential remodeling jobs. The suit involved an account receivable
for a patio remodel job. Using the dictionary definitions suggested in
Krause, the “right to transact business" that AA Primo forfeited should
not have included its ability to see this suit through to the end.

Subsection 5 of the revocation statute confirms our dictionary-

based reading of “transact business” in the context of a Nevada limited
liability company that has lost its charter. NRS 86.274(6) states that “the

 

 
same proceedings may be had” with respect to a revoked entity's property
and assets as NRS 86.505 permits with respect to a dissolved entity:

If the charter of a limited-liability company is
revoked and the right to transact business is
forfeited, all of the property and assets... must be
held in trust by the managers or, if none, by the
members of the company, and the same
proceedings may be had with respect to its
ropert apply to the dissolution of a
aor RS
86.505 ....
NRS 86.274(5) (emphasis added). Addressing dissolved entities, NRS
86.505 says that, since the right to sue and be sued is integral to winding

up, it survives dissolution:

not impair any-remedy or cause of action available
to or against jit... arising before its dissolution
and commenced within 2 years after the date of
dissolution. A dissolved company_continues as_a
company ose _ of and
def actions, and claims of

it gradually to settle and close its business, [and]
to collect and discharge its obligations, to dispose
of and convey its property, and to distribute its
assets, but not for the purpose of continuing the
business for which it was established

NRS 86.505 (emphasis added). With the possible exception of an LLC

whose “business” is litigation—say, a law firm or a collection ageney—NRS
86.274(5) and NRS 86.505 thus seem to permit a domestic LLC to sue and

 

 
be sued despite a revoked charter. See also Gale v. Carnrite, 559 F.3d
359, 363-64 (6th Cir. 2009) (under NRS 86.274 and NRS 86.505 a cause of
action held by a Nevada LLC did not abate on charter revocation and was
assignable).

Against the statutory text, the Washingtons argue that AA
Primo ceased to exist—died—when its charter was revoked, meaning
everything it was involved in, including litigation, stopped. If equating an
entity's end with a human being’s death ever had currency, see Phillip
Suability of Dissolved Corporations—A Study in Interstate and
Eederal-State Relationships, 58 Harv. L. Rev. 675, 677 (1945) (this

comparison “appear[s] to represent only an uncritical search for analogies’

Mareus,

 

 

and is specious), it has none today under modern statutes that provide,
inter alia, for dissolved entities to wind up their affairs, see NRS 86.505,
for permanently revoked entities to be revived even after the passage of

years, NRS 86.580; see Red] v, Secretary of State, 120 Nev. 75, 85 P.3d
797 (2004), and for a revoked entity's charter to be reinstated

retroactively, NRS 86.276(5). See Penasquitos v. Superior Court Barbee),
"Clipper Air Cargo v. Aviation Products, 981 F. Supp. 956, 958

(S.C. 1997), inferred a similar result from the corporations code
analogues to NRS 86.275 and NRS 86.505 (NRS 78.175 and 78.585). We
leave for another day the significance. if any, of the language differences
between the corporations code and the limited liability company statutes
concerning the proceedings that may be had following charter revocation.

 

‘Further supporting this conclusion is NRS 86.5483, which, like the
dissolution statute, NRS 86.505, made applicable to revocation by NRS
86.274(5), excludes “[mlaintaining, defending or settling any proceeding”
from the definition of “transacting business” for foreign LLCs,

 

 
812 P.2d 154, 160 (Cal. 1991) (an entity's dissolution should not be seen

 

‘as its death, but merely as its retirement from active business”) (also
citing Seavy v. LX.L, Laundry Co,, 60 Nev. 824, 329-30, 108 P.2d 853, 855
(1941) (to similar effect), overruled on other grounds by Turpel v. Sayles,
101 Nev. 35, 37, 692 P.2d 1290, 1291 (1985)). AA Primo survived
revocation of its charter; the only real issue is whether its lawsuit did.

‘The Washingtons’ backup argument for dismissal proceeds
from a misreading of Chapter 86's “[gjeneral powers” statute, NRS 86.281.
‘The Washingtons’ brief cites NRS 86.281(1), parenthetically describes

 

“providing that only ‘organized and existing’ companies may ‘sue and be
sued” (emphasis added), and fallaciously concludes that “per the plain,
express language of the enabling statute of NRS $6,281,” a revoked LLC

cannot “bring or maintain lawsuits.” But the word “only” isn't in NRS

 

86.281, and it begs the question for the Washingtons to add it in. As a
general powers statute, NRS 86.281 simply lists the things a Nevada LLC
“may” do; it says nothing about what a revoked LLC may not do.

Last, the Washingtons argue that dismissal serves an important
enforcement interest. In their view, allowing scofflaw entities to maintain
suits rewards noncompliance, at the expense of other parties to the suit,
who may face an uncollectible judgment or fee award against a defunct
entity. But Chapter 86 specifies the penalties appropriate to impose for
operating without a current charter, distinguishing between entities with
lapsed charters and those doing business without ever having been

properly formed. Doing business as an LLC without filing the initial

organizational documents carries significant fines of up to $10,000, NRS
86.213(1). A revoked charter, by contrast, carries no fines, only a $75
penalty reinstatement fee. NRS 86.272(3). As for incentivizing judgment-

 

 
proof LLCs to litigate with wanton abandon, NRS 86.361 provides that
members of an unchartered entity risk individual liability unless the
default is cured. See Nichiryo Am., Inc. v, Oxford Worldwide, LLC, No.
03:07-CV-00335-LRH-VPC, 2008 WL 2457935 (D. Nev. June 16, 2008); see
also Resort at Summerlin v, Dist. Ct., 118 Nev. 110, 40 P.8d 432 (2002)
(interpreting NRS 80.210 (now NRS 80.055) to condition commencement
and maintenance of a lawsuit for foreign corporations on initial
qualification rather than continuous upkeep of its qualification). The
Legislature has addressed the penalties for an administrative default
leading to charter revocation and loss of capacity to sue is not among
them,

For these reasons, we conclude that the district court erred when it
dismissed AA Primo’s suit based on its charter having been revoked.

B.

NRS 86.276(5) provides a second, independently sufficient
basis for reversal. When AA Primo succeeded in reinstating its charter, it
brought itself under NRS 86.276(5). By its plain terms, this statute
pardoned AA Primo’s administrative default and restored its rights
retroactive to the date of revocation:

[A] reinstatement pursuant to this section relates
back to the date on which the company forfeited
its right to transact business under the provisions
of this chapter and reinstates the company's right
to transact business as if such right had at all
times remained in full force and effect.

 

As we have already held, AA Primo properly presented its reinstated
charter to the district court by way of a timely NRCP 59(e) motion to alter
or amend the judgment of dismissal. Although not separately appealable

as a special order after judgment, an order denying an NRCP 59(e) motion

 

 
oe ae

 

is reviewable for abuse of discretion on appeal from the underlying
judgment. See 11 C. Wright, A. Miller & M. Kane, supra, § 2818, at 188,
(distinguishing between appealability and reviewability and noting that
an order deciding a Rule 59(e) motion, while not independently
appealable, is reviewable for abuse of discretion); ef. Arnold v. Kip, 123
Nev. 410, 168 P.8d 1050 (2007) (an order denying reconsideration may be
reviewed on appeal from the underlying judgment).

While review for abuse of discretion is ordinarily deferential,
not owed to legal error. See United States v. Silva, 140 F.3d
1098, 1101 n.d (7th Cir. 1998). Here, NRS 86.274(5) required the district
court to treat AA Primo as if its charter had never been revoked. ‘The

deference

 

judgment of dismissal remained modifiable and should have been vacated
on motion by AA Primo. Duncan v, Sunset Agricultural Minerals, 78 Cal.
Rptr. 339, 342 (Ct. App. 1969). It thus was an abuse of discretion not to
have granted AA Primo’s timely application for relief under NRS
86.276(5).
GQ

Finally, we note that the brief stay AA Primo requested would
have given it time to reinstate its charter and avoided the delay and
expense associated with dismissal, post-judgment motion practice, and
appeal. Dismissal is an unnecessarily costly penalty when the desired
result—compliance with Nevada's fee and filing statutes—can be
accomplished through a stay. See Executive Mgmt,, 118 Nev. at 52, 38
P.3d at 876.

16

 
We therefore reverse and remand. Since the reversal removes

the predicate for fees and costs, their award is also reversed.

Pickering:

Ne feck

Hardesty

y oo
Doudfas'