Court Opinion

ID: 6335683
Source: CourtListenerOpinion
Date Created: 2022-04-28 10:07:06.859295+00
Date Added: 2024-06-11T09:23:54.270707
License: Public Domain

IN THE SUPREME COURT OF THE STATE OF NEVADA

                 BRAD L. KNOWLTON, AN                                  No. 82694
                 INDIVIDUAL,
                 Appellant,
                 vs.
                 WILLIAM L. LINDER, AS TRUSTEE OF
                 THE WILLIAM L. LINDER AND                             FILED
                 MAXINE G. LINDER TRUST OF 1988;
                 JUEL A. PARKER, AS TRUSTEE OF
                                                                       APR 2 7 2022
                                                                              A. BROWN
                 THE JUEL A. PARKER FAMILY                                  UPREME COURT
                 TRUST; LISA PARKER, AS TRUSTEE                               CLEM
                 OF THE JUEL A. PARKER FAMILY
                 TRUST; LISA PARKER, AN
                 INDIVIDUAL; AND S. BRUCE
                 PARKER, AS TRUSTEE OF THE
                 STEVEN BRUCE PARKER FAMILY
                 TRUST,
                 Res ondents.

                                       ORDER OF AFFIRMANCE

                            This is an appeal from a district court summary judgment in a
                business dispute. Eighth Judicial District Court, Clark County; Elizabeth
                Gonzalez, Judge.
                            Respondents William Linder, Juel Parker, Lisa Parker, and S.
                Bruce Barker (the Trustees) controlled 61% of Valley Ascent, LLC (Valley
                Ascent) on behalf of several trusts. Appellant Brad Knowlton owned 39%
                of Valley Ascent and served as its manager. After the Trustees removed
                Knowlton as the manager of Valley Ascent, he filed a complaint alleging
                that he was wrongfully removed and that the Trustees were causing harm
                to Valley Ascent. Later, Knowlton divorced his spouse in Utah. Pursuant
                to the Utah decree of divorce, Knowlton agreed to an assignment of interest
                (the assignment) that transferred all rights and claims relating to his
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ownership interest in Valley Ascent to his former spouse. Knowlton's
former spouse requested that he dismiss his complaint against the Trustees.
He refused. The Trustees moved for summary judgment on the ground that
Knowlton lacked standing to maintain his complaint because he assigned
away all rights and claims relating to his ownership interest in Valley
Ascent. The district court agreed and entered summary judgment in favor
of the Trustees.
            On appeal, Knowlton argues that the district court erroneously
concluded that he lacked standing because (1) the Utah decree of divorce,
which contained the assignment that transferred his interest in Valley
Ascent to his former spouse, was not a final judgment, (2) the assignment
unambiguously transferred only his prospective rights as an owner of Valley
Ascent to his former spouse, and (3) his claims as the former manager of
Valley Ascent survive the assignment. We disagree with each of Knowlton's
arguments and affirm.
            A summary judgment will be affirmed if this coures de novo
review of the trial record—viewed in the light most favorable to the
nonmovant—shows "that no genuine issue as to any material fact [remains]
and that the moving party is entitled to a judgment as a matter of law."
Wood v. Safeway, Inc., 121 Nev. 724, 729, 121 P.3d 1026, 1029 (2005)
(alteration in original) (internal quotation marks omitted). Likewise,
"[s]tanding is a question of law reviewed de novo." Arguello v. Sunset
Station, Inc., 127 Nev. 365, 368, 252 P.3d 206, 208 (2011). A party has
standing if it "possesses the right to enforce the claim and has a significant
interest in the litigation." Id. (internal quotation marks omitted).
            First, Knowlton argues that the Utah decree of divorce was not
a final judgment because (1) it is currently being appealed in Utah, and (2)
his motion to alter or amend the decree of divorce was pending in the Utah

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                    district court when the Nevada district court granted summary judgment.
                    We reject both contentions because Knowlton included no documentation in
                    the trial or appellate records—other than counsel's statements—to show the
                    status of the proceedings in Utah. See Jain v. McFarland, 109 Nev. 465,
                    475-76, 851 P.2d 450, 457 (1993) ("Arguments of counsel are not evidence
                    and do not establish the facts of the case."); Smithart v. State, 86 Nev. 925,
                    930, 478 P.2d 576, 580 (1970) ("On appeal this court will not consider
                    anything outside the trial record."). Due to the inadequate record on appeal,
                    we are unable to conclude that the district court erred by concluding that
                    the Utah decree of divorce was a final judgment. Moreover, Utah law
                    provides that a judgment is final unless a stay has been entered pending
                    appeal, 2DP Blanding, LLC v. Palmer, 423 P.3d 1247, 1251 (Utah 2017),
                    and Knowlton included nothing in the record to show that the decree of
                    divorce was stayed pending appeal. Thus, this argument is meritless.
                                Second, Knowlton contends that the assignment only
                    transferred his prospective rights as an owner of Valley Ascent, so he can
                    still assert retrospective claims relating to his ownership interest. If a
                    contract is unambiguous, this court will effectuate the ordinary meaning of
                    the words in the contract. See Dickenson v. State, Dep't of Wildlife, 110 Nev.
                    934, 937, 877 P.2d 1059, 1061 (1994) (stating that summary judgment is
                    improper if the contract is ambiguous). Here, the assignment states that
                    Knowlton assigned to his former spouse "any and all rights, interests,
                    and/or claims related to his ownership interest in Valley Ascent." Because

                          'We decline Knowlton's request to take judicial notice of the Utah
                    proceedings because doing so would require this court to go outside of the
                    record to obtain Utah court records. See Mack v. Estate of Mack, 125 Nev.
                    80, 91, 206 P.3d 98, 106 (2009) (stating that, even if cases are related, this
                    court will generally not take judicial notice of records in a separate case).
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(0) 1947A 446144.
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                       the assignment plainly and unambiguously states that Knowlton assigned
                       away any and all claims, we conclude that he assigned away every claim
                       (i.e., both prospective and retrospective claims) related to his ownership
                       interest in Valley Ascent. Cf. Coffee v. Henry, 240 P.3d 1056, 1057 (Okla.
                       2010) (stating that "Nile term 'every ordinarily means 'any' or 'all"). Thus,
                       Knowlton lacked standing, as he no longer "possesse[d] the right to enforce"
                       any claim related to his interest in Valley Ascent. Arguello, 127 Nev. at
                       368, 252 P.3d at 208 (internal quotation marks omitted). Because the
                       Trustees were entitled to judgment as a matter of law on the claims relating
                       to Knowlton's former ownership interest, the district court did not
                       erroneously grant summary judgment.
                                   Third, Knowlton contends that his claims for breach of contract,
                       breach of implied covenant of good faith and fair dealing, and breach of
                       fiduciary duty survive in his capacity as the former manager of Valley
                       Ascent.2 Valley Ascent's operating agreement unambiguously states that
                       its "[Manager shall not have any contractual right to such position." Thus,
                       Knowlton's claims for breach of contract and breach of implied covenant of
                       good faith and fair dealing—both of which require a contract—fail as a
                       matter of law because he had no contractual right to be the manager of
                       Valley Ascent. See State, Dep't of Transp. v. Eighth Judicial Dist. Court,
                       133 Nev. 549, 554, 402 P.3d 677, 682 (2017) (explaining that a breach of
                       contract is the failure to perform a duty created by an agreement); see also
                       id. at 555, 402 P.3d at 683 (noting that contracts contain "an implied

                             2Because  Knowlton assigned away his ownership interest in Valley
                       Ascent, he lacked standing to assert these claims derivatively on behalf of
                       the company. Cf. Parametric Sound Corp. v. Eighth Judicial Dist. Court,
                       133 Nev. 417, 424, 401 P.3d 1100, 1106 (2017) (explaining that former
                       shareholders of a company lack standing to bring a derivative claim).
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(0) 1947A    40101:.
                     covenant of good faith and fair dealing, which prohibits arbitrary or unfair
                     acts by one party that work to the disadvantage of the othee (internal
                     quotation marks omitted)). Likewise, we reject Knowlton's contention that
                     he can maintain a claim for breach of fiduciary duty as the former manager
                     of Valley Ascent. Knowlton cites only NRS 86.291(3), which states that a
                     limited liability company can be member-managed or manager-managed,
                     but this statute does not show that Valley Ascent or its members owed
                     Knowlton fiduciary duties in his capacity as the manager of the company.
                     Knowlton cited no other authority below or on appeal to show the existence
                     of such a fiduciary duty and therefore he has failed to cogently argue this
                     point. See Edwards v. Emperor's Garden Rest., 122 Nev. 317, 330 n.38, 130
                     P.3d 1280, 1288 n.38 (2006) (stating that we will not consider arguments
                     unsupported by relevant authority); cf. NRS 86.298(2) (stating that an
                     operating agreement can impose fiduciary duties on the manager). Because
                     Knowlton's claims as the former manager of Valley Ascent fail as a matter
                     of law, the district court correctly granted summary judgment in favor of
                     the Trustees.
                                 Accordingly, we
                                 ORDER the judgment of the district court AFFIRMED.

                                                0.4.4g.D                J.
                                             Silver
                                     .

                                                J.
                     Cadish                                    Pickering

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(0) 1947* cligbly•
                cc:   Hon. Linda Marie Bell, Chief Judge
                      Eighth Judicial District Court, Department 11
                      Carolyn Worrell, Settlement Judge
                      Erickson & Whitaker PC
                      Greenberg Traurig, LLP/Las Vegas
                      Eighth District Court Clerk

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10) I947A