Opinion ID: 2514649
Heading Depth: 1
Heading Rank: 10

Heading: Attorney fees and prejudgment interest

Text: On cross-appeal, Crestdale Associates argues that its offer of judgment justified an award of attorney fees under both NRS 17.115 and NRCP 68. Specifically, it argues that Multi-Family, Walter Homes, and Midby proceeded on a common theory of liability against Crestdale Associates. It submits that the Multi-Family Development plaintiffs filed a joint complaint with the same allegations and causes of action and that, because Midby is the managing member of Multi-Family Development and Walter Homes, he was authorized to decide whether to accept the offer of judgment as to all of the Multi-Family Development parties. Crestdale Associates further argues that it was entitled to prejudgment interest under NRS 99.040. [27] We review a district court's decisions concerning attorney fees and prejudgment interest for an abuse of discretion. [28] Initially, under NRS 17.115, a party may recover attorney fees when the opposing party rejects an offer of judgment and fails to recover more than the offer at a subsequent trial. NRCP 68(c)(3) provides that: An offer made to multiple plaintiffs will invoke the penalties of this rule only if (A) the damages claimed by all the offeree plaintiffs are solely derivative, such as that the damages claimed by some offerees are entirely derivative of an injury to the others or that the damages claimed by all offerees are derivative of an injury to another, and (B) the same entity, person or group is authorized to decide whether to settle the claims of the offerees. NRS 17.115(9)(b) sets forth a similar rule with respect to multiple plaintiffs. In Albios v. Horizon Communities, Inc., [29] we determined that in order to invoke the offer of judgment penalty provisions as to multiple plaintiffs, the defendant must show either (1) a single common theory of liability or (2) derivative damages. [30] In addition, the defendant is required to show that the same plaintiff was authorized to accept the settlement offer on behalf of all of the plaintiffs. [31] Here, Crestdale Associates' offer of judgment to Multi-Family Development was not apportioned between or among the plaintiffs. Further, it appears that there was a factual dispute as to whether Midby was able to accept settlement offers for all of the plaintiffs because Allsop was a 12.5 percent owner of Walter Homes and the sole member of its Administrative Committee. As a result, Allsop may have been required to approve any settlement offers. In addition, the theories against Allsop for breach of contract arising from the general covenant of good faith and fair dealing were separable from those lodged against Crestdale Associates as a separate entity because Crestdale Associates was not bound by the Operating Agreement that governed the Walter Homes members. Accordingly, the district court did not abuse its discretion in refusing to award Multi-Family Development attorney fees under NRS 17.115 and NRCP 68. [32] As to prejudgment interest, we held in Paradise Homes v. Central Surety [33] that The amount of money to which the interest rate will be applied [under NRS 99.040] must be determined by the following factors: (1) if the contract breached provides for a definite sum of money, that sum; (2) if the performance called for in the contract, the value of which is stated in money or is ascertainable by mathematical calculation from a standard fixed in the contract or from established market prices of the subject matter, that sum. [34] Later, in Jeaness v. Besnilian, [35] we applied the Paradise Homes formula and reversed a district court decision to award prejudgment interest on a portion of monthly profits from a dry cleaning business plus a portion of its resale value. In particular, we concluded that because the agreement entered into did not provide a definite sum of money, and the value of the performance was neither stated nor ascertainable by mathematical calculation from a standard fixed in the contract or established market prices, prejudgment interest was not recoverable. [36] Here, as in Jeaness, the amount of money due under the oral consulting agreement between Allsop and Midby was neither definite nor readily ascertainable until judgment. Because the duration of the consulting agreement was unknown at the time when the contract was negotiated, and because Midby was to pay Allsop monthly for his consulting services, Midby did not owe a definite amount of money. Further, the mathematical calculation of damages that Crestdale Associates offers is merely its interpretation of the damages due under the oral agreement. Accordingly, we conclude that the district court did not abuse its discretion in refusing to award Crestdale Associates prejudgment interest under the consulting agreement.