Opinion ID: 2604705
Heading Depth: 1
Heading Rank: 4

Heading: The district court properly applied this court's holding in Mackintosh I.

Text: In its cross-appeal, Cal Fed argues that the district court improperly applied this court's decision in Mackintosh I and that no special relationship existed between the Mackintoshes and Cal Fed such that Cal Fed had a duty to disclose the defect in the basement. We conclude that the district court properly applied our holding from Mackintosh I. In Mackintosh I, we stated: Although a claim of nondisclosure will not overcome an `as-is' clause, a claim of fraudulent concealment will. Nondisclosure will become the equivalent of fraudulent concealment when it becomes the duty of a person to speak in order that the party with whom he is dealing may be placed on an equal footing with him. The duty to speak does not necessarily depend on the existence of a fiduciary relationship. Central States Stamping Co. v. Terminal Equipment Co., (C.A.6, 1984), 727 F.2d 1405, 1409. `   It may arise in any situation where one party imposes confidence in the other because of that person's position, and the other party knows of this confidence.   '  Id. ... Mackintosh I, 109 Nev. at 634-35, 855 P.2d at 553 (quoting Mancini v. Gorick, 41 Ohio App.3d 373, 536 N.E.2d 8, 9-10 (1987)) (citations omitted). We concluded by stating: A jury may find that a special relationship existed if the jury determines that California Federal's status as the lender as well as the seller would have caused a reasonable person to place more confidence and reliance on California Federal than would be placed on an ordinary seller. In other words, the jury must ascertain whether the Mackintoshes, under the circumstances, could reasonably expect California Federal, as lender and seller, to pay greater attention to its interests than would an ordinary seller who was not also providing long-term financing on the property. Mackintosh I, 109 Nev. at 635, 855 P.2d at 554. The trier of fact's verdict will not be overturned if it is supported by substantial evidence, unless the verdict was clearly erroneous when viewed in light of all the evidence presented. Bally's Grand Employees' Federal Credit Union v. Wallen, 105 Nev. 553, 555-56, 779 P.2d 956, 957 (1989). Substantial evidence is that which a reasonable mind might accept as adequate to support a conclusion. State Emp. Security v. Hilton Hotels, 102 Nev. 606, 608, 729 P.2d 497, 498 (1986). Initially, we take this opportunity to further refine our holding in Mackintosh I by stating that the existence of the special relationship is a factual question and that while a seller/lender situation creates an inference that the relationship was created, all of the facts must be considered in order to determine if the relationship was created. Using this refined test, we conclude that the district court's conclusion that Cal Fed and the Mackintoshes shared a special relationship was supported by substantial evidence. First, Cal Fed rejected the Mackintoshes' initial offer and issued a counteroffer which specifically required the Mackintoshes to obtain financing for the house through Cal Fed. The record indicates that the requirement of financing only through Cal Fed was suspicious because it was not Cal Fed's policy to require buyers of Cal Fed's foreclosed homes to borrow money from Cal Fed. We concur with the district court's conclusion that a third party lender would likely not have lent money on the home unless and until the flooding problem was corrected and that it was a reasonable inference that Cal Fed required the Mackintoshes to seek a loan through it for that reason. Second, Richard testified that he believed that because Cal Fed insisted that the Mackintoshes obtain a loan through them, Cal Fed knew of the condition of the house and would tell him if anything was wrong with the house despite its sale as-is. Richard also stated that he believed that because Cal Fed was the seller and the lender it would not lend him the money if the property was not acceptable. Third, Cal Fed spent money to repair the property both before and after escrow closed. This evidence supported the district court's conclusion that the Mackintoshes had placed more confidence and reliance on Cal Fed than would be placed on an ordinary seller. Additionally, evidence supported the conclusion that Cal Fed knew or should have known of the Mackintoshes' special reliance. Cal Fed apparently had no actual knowledge that the Mackintoshes had placed special reliance on it. Clark testified that he had no conversations with the Mackintoshes either before or after the sale, he first met the Mackintoshes at a deposition in 1990, and he received no communications that would lead him to believe that the Mackintoshes were placing any special reliance on either him or Cal Fed. However, Cal Fed did not need actual knowledge of the reliance to satisfy the second prong of the special relationship test. We stated that the first prong of the test required that the trier of fact find only that the conditions would cause a reasonable person to impart special confidence in the seller/lender. Mackintosh I, 109 Nev. at 635, 855 P.2d at 554. Therefore, we conclude that the second prong of the test also requires only that a reasonable lender would have known of this confidence. Based on Cal Fed's actions with regard to the Mackintoshes, we conclude that sufficient evidence supported the district court's conclusion that a reasonable lender would have known of the special confidence.