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Appellants brought suit in district court against their 

homeowners' association, the association's board of directors (collectively, 

the Association), and Las Vegas Motorcoach Partners (Partners), an entity 

that extended a loan to the Association. Both groups of respondents 

moved to dismiss on the ground that appellants' lawsuit was subject to 

mandatory arbitration and that the district court was therefore the 

inappropriate forum to resolve the parties' dispute. See NRS 38.310(1) 

("No civil action based upon a claim relating to. . . Nile interpretation, 

application or enforcement of any. . . bylaws, rules or regulations adopted 

by an association. . . may be commenced in any court in this State unless 

the action has been submitted to mediation or arbitration . . . ."). 

The district court agreed and granted respondents' motions. 

Thereafter, respondents requested attorney fees and costs, and the district 

court awarded both. On appeal, appellants contend that these awards 

were improper.' We address each award in turn. 

Appellants had a reasonable basis for believing that district court was the 

proper forum to resolve their dispute 

The district court awarded attorney fees to respondents under 

NRS 18.010(2)(b), which permits such an award "when the court finds that 

the claim. . . was brought or maintained without reasonable ground or to 

harass the prevailing party." On appeal, appellants contend that the 

district court abused its discretion in basing the awards of attorney fees on 

this conclusion. See Semenza v. Caughlin Crafted Homes, 111 Nev. 1089, 

'Because appellants did not appeal from the order of dismissal, we 

do not address the propriety of that order. 

2 
1095, 901 P.2d 684, 687 (1995) (reviewing a district court's award of 

attorney fees under NRS 18.010(2)(b) for an abuse of discretion). 

We agree. "Although a district court has discretion to award 

attorney fees under NRS 18.010(2)(b), there must be evidence supporting 

the district court's finding that the claim or defense was unreasonable or 

brought to harass." Bower v. Harrah's Laughlin, 125 Nev. 470, 493, 215 

P.3d 709, 726 (2009). Here, the district court's order failed to identify any 

evidence that supported its finding, and our independent review of the 

record reveals no evidence that could do so. 

To the contrary, the record demonstrates that appellants 

reasonably believed NRS 38.310 was inapplicable. As they explained 

when opposing respondents' motions to dismiss, appellants believed that 

their three causes of action could be established under principles of 

common law and without resort to the Association's bylaws, rules, or 

regulations. Namely, appellants' cause of action for declaratory relief 

sought to void the Association's loan agreement with Partners on the 

ground that it was unconscionable. Cf. Pacificare of Nevada v. Rogers, 127 

Nev. , 266 P.3d 596, 598 (2011) (indicating that the doctrine of 

unconscionability derives from principles of common law). Likewise, 

appellants sought to establish their breach-of-fiduciary-duty cause of 

action against the Association's president by showing that he had engaged 

in self-dealing, thereby breaching his duty of loyalty. Cf. Shoen v. SAC 

Holding Corp,, 122 Nev. 621, 632, 137 P.3d 1171, 1178 (2006) ("[T]he duty 

of loyalty requires the board and its directors to maintain, in good faith, 

the corporation's and its shareholders' best interests over anyone else's 

interests."). Finally, appellants sought to establish their breach-offiduciary-duty cause of action against the Association's directors by 

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showing that some directors approved the loan agreement without 

knowing what the loan's material terms were, thereby breaching their 

duty of care. 2Cf.id. ("[T]he duty of care consists of an obligation to act on 

an informed basis. . . ."). 

In our only published opinion discussing NRS 38.310's scope, 

we generally held that li]f parties dispute the interpretation and 

enforcement of CC&Rs [or governing documents], they must first submit 

to mediation or arbitration." Hamm v. Arrowcreek Homeowners' Ass'n, 

124 Nev. 290, 301, 183 P.3d 895, 904 (2008). As explained above, the 

causes of action in appellants' complaint arguably do not implicate the 

Association's governing documents. While respondents may have been 

able to point to various bylaws, rules, or regulations in defending against 

appellants' claims, nothing in NRS 38.310 or Hammnecessarily should 

have alerted appellants of the need to anticipate respondents' theories of 

defense when deciding whether to file their complaint in district court. 

Thus, although we need not decide whether appellants' 

complaint was subject to NRS 38.310's arbitration requirement, 

appellants at least had a reasonable basis for believing that the district 

court was the appropriate forum to resolve their dispute with respondents. 

Cf. Bobby Berosini, Ltd. v. PETA, 114 Nev. 1348, 1354-55, 971 P.2d 383, 

387 (1998) (reversing an award of attorney fees under NRS 18.010(2)(b) 

2We recognize that the exact basis for appellants' cause of action 

against the directors is less than clear and that certain allegations may 

implicate the Association's governing documents. Nonetheless, to the 

extent that the district court inferred an improper motive on appellants' 

part based solely on ambiguities in their pleadings, the district court 

abused its discretion. 

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when "the status of Nevada law was unclear" regarding the viability of the 

plaintiffs complaint). Consequently, the district court abused its 

discretion in awarding attorney fees under NRS 18.010(2)(b), see 

Semenza, 111 Nev. at 1095, 901 P.2d at 687, and we reverse these 

awards. 3 

The district court impliedlv granted additional time for respondents to file 

and serve their memoranda of costs 

Appellants contend that respondents failed to file and serve 

their memoranda of costs within five days of when the district court 

entered its dismissal order. See NRS 18.110(1) (stating that a party who 

requests costs "must file with the clerk, and serve a copy upon the adverse 

party, within 5 days after the entry of judgment, or such further time as 

the court or judge may grant, a memorandum of the items of the costs in 

the action or proceeding" (emphasis added)). Appellants acknowledge, 

however, that NRS 18.110(1)'s five-day requirement is not jurisdictional, 

and we have previously held that when the district court proceeds to 

award costs after the five-day window has elapsed, it has impliedly 

granted additional time. Eberle v. State ex rel. Redfield Trust, 108 Nev. 

3Contrary to the Association's contention, its award of attorney fees 

cannot be affirmed by treating the award as a sanction imposed under 

NRCP 11. For the district court to impose sanctions on its own initiative 

under NRCP 11(c), it would have needed to "enter an order describing the 

specific conduct" that it believed was sanction-worthy and afford 

appellants an opportunity to establish otherwise. NRCP 11(c)(1)(B). 

Nothing in the record suggests that the district court did this. 

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587, 590, 836 P.2d 67, 69 (1992). Consequently, respondents' requests for 

costs were timely and are therefore affirmed. 4 

Consistent with the foregoing, we ORDER the judgment of the 

district court AFFIRMED IN PART AND REVERSED IN PART. 

Gibbons 

Douglas 

Saitta 

cc: Hon. Kathy A. Hardcastle, District Judge 

Robert F. Saint-Aubin, Settlement Judge 

Adams Law Group 

Leach Johnson Song & Gruchow 

Carbajal & McNutt, LLP 

Eighth District Court Clerk 

4Appellants contend that the district court failed to rule on their 

motion to retax costs. Because their motion was pending when the district 

court granted respondents' requests for costs, appellants' motion was 

impliedly denied. Bd. of Gallery of History v. Datecs Corp., 116 Nev. 286, 

289, 994 P.2d 1149, 1150 (2000) (noting that the district court's failure to 

rule on a request constitutes a denial of the request). 

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