Court Opinion

ID: 3212535
Source: CourtListenerOpinion
Date Created: 2016-06-13 15:06:11.743406+00
Date Added: 2024-06-11T14:29:45.797533
License: Public Domain

IN THE SUPREME COURT OF THE STATE OF NEVADA

                NEVADA CONTRACTORS                                  No. 61279
                INSURANCE COMPANY, INC.,
                Appellant,                                                        iLED
                vs.
                                                                                JUN 1 0 2016
                RISK SERVICES-NEVADA, INC.; AND
                MIKE ROGERS,
                Respondents.
                NEVADA CONTRACTORS                                  No. 6204
                INSURANCE COMPANY, INC., A
                NEVADA CORPORATION,
                Appellant,
                vs.
                RISK SERVICES-NEVADA, INC.; AND
                MIKE ROGERS,
                Respondents.
                NEVADA CONTRACTORS                                  No. 62340
                INSURANCE COMPANY, INC.,
                Appellant,
                vs.
                RISK SERVICES-NEVADA, INC.; AND
                MIKE ROGERS,
                Respondents.
                NEVADA CONTRACTORS                                  No. 64532
                INSURANCE COMPANY, INC., A
                NEVADA CORPORATION,
                Appellant,
                vs.
                RISK SERVICES-NEVADA, INC.; AND
                MIKE ROGERS,
                Respondents.

                                       ORDER OF AFFIRMANCE
                           These are consolidated appeals from a district court judgment
                enforcing a settlement agreement in a tort action and a subsequent post-

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                    judgment order awarding attorney fees (Docket Nos. 61279 and 62049),
                    and from a final order granting summary judgment based on claim and
                    issue preclusion in a breach of contract action and a second post-judgment
                    order awarding attorney fees (Docket Nos. 62340 and 64532). Eighth
                    Judicial District Court, Clark County; Elizabeth Goff Gonzalez, Judge.
                                 After respondent Risk Services-Nevada (RSN) and a third
                    party each separately sued appellant Nevada Contractors Insurance
                    Company (NCI) for breach of a settlement agreement, NCI sought to
                    rescind the agreement against both the third party and RSN, alleging
                    fraudulent inducement (2011 case).          The enforceability issue was
                    transferred to the department that heard the original case (2008 case) for
                    an evidentiary hearing on the limited issue of the settlement agreement's
                    enforceability. The district court concluded in the 2008 case that the
                    agreement was valid and enforceable. Thereafter, the district court
                    granted summary judgment in the 2011 case in favor of RSN and against
                    NCI's fraudulent inducement defense on claim and issue preclusion
                    grounds. NCI appealed, challenging the district court's enforceability and
                    preclusion rulings, as well as attorney fee awards in both cases.
                    The district court did not erroneously conclude that the settlement
                    agreement was enforceable
                                 NCI contends that the district court used an improper
                    standard in conducting the evidentiary hearing on the enforceability of the
                    settlement agreement in the 2008 case by subjecting the evidence to a
                    more rigorous standard than the prima-facie-evidence standard stated in a
                    pre-trial stipulation. Further, NCI argues that, by doing so, the court
                    denied it the right to a jury trial.

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                                The district court's power to enforce a settlement agreement is
                   equitable in nature, including when fraudulent inducement is asserted in
                   defense, and the district court has discretion to address an action's
                   equitable issues before allowing a jury to resolve the action's legal issues.
                   Awada v. Shuffle Master, Inc., 123 Nev. 613, 621-22, 173 P.3d 707, 712-13
                   (2007); Callie v. Near, 829 F.2d 888, 890 (9th Cir. 1987). Thus, we
                   conclude that the district court did not erroneously deprive NCI of any
                   jury-trial right.
                                Moreover, the parties' stipulation does not bind the district
                   court on legal questions. Ahlswede u. Schoneveld, 87 Nev. 449, 452, 488
P.2d 908, 910 (1971). The matter presented to the district court was
                   whether the settlement agreement was enforceable in light of NCI's
                   fraudulent-inducement defense. As the district court properly applied the
                   clear-and-convincing standard required by Nevada law, J.A. Jones Const.
                   Co. v. Lehrer McGovern Bovis, Inc., 120 Nev. 277, 290-91, 89 P.3d 1009,
                   1018 (2004), we conclude that it did not err, Matter of Halverson., 123 Nev.
493, 509, 169 P.3d 1161, 1172 (2007) ("The correct standard of proof to be
                   used by a tribunal is a legal question, thus subject to our de novo review.").
                                Next, NCI argues that the district court's ruling on
                   enforceability was not supported by substantial evidence, alleging that it
                   demonstrated several instances of fraudulent inducement. "Substantial
                   evidence is evidence that a reasonable mind might accept as adequate to
                   support a conclusion."   VVhitemaine v. Aniskovich,   124 Nev. 302, 308, 183
P.3d 137, 141 (2008). That Salvatore Gugino described the condition of
                   the claims files after the parties had agreed to the material terms of the
                   settlement agreement supports the district court's conclusion that NCI did

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                 not rely on that representation in entering the agreement. See J.A. Jones
                 Const. Co., 120 Nev. at 290-91, 89 P.3d at 1018 (setting forth fraudulent-
                 inducement elements); Pac. Maxon, Inc. v. Wilson, 96 Nev. 867, 870-71,
                 619 P.2d 816, 818 (1980) (holding that actual, rather than justifiable
                 reliance, is required for rescission pursuant to fraudulent inducement).
                 The context of demanding a buy-out as a counteroffer during negotiations
                 supports the district court's conclusion that Gugino's demand was his
                 opinion of the value of his position.    See Johansson v. Stephanson, 154
U.S. 625, 625 (1877); Bulbman, Inc. ix Nev. Bell, 108 Nev. 105, 111, 825
P.2d 588, 592 (1992); Clark Sanitation, Inc. v. Sun Valley Disposal Co., 87
Nev. 338, 341-42, 487 P.2d 337, 339 (1971). Evidence that the
                 representations regarding the self-insured retentions and policy exclusions
                 occurred years before the negotiations supports the district court's
                 conclusion that NCI did not rely on those representations in connection
                 with the negotiations. The testimony that NCI's directors believed that
                 legal malpractice was not released by the settlement supports the finding
                 that NCI did not rely on the alleged statements on this topic. Accordingly,
                 we conclude that substantial evidence supports the district court's
                 enforceability ruling, and the July 6, 2012, order is affirmed in Case No.
                 A-08-558139-B.
                 The district court properly granted summary judgment
                             NCI argues that the district court erred in granting summary
                 judgment on its claims in the 2011 case based on claim and issue
                 preclusion because it could not have litigated its fraud claims against
                 Gugino in its 2008 complaint. Having reviewed the record de novo, see
                 Wood v. Safeway, Inc., 121 Nev. 724, 729, 121 P.3d 1026, 1029 (2005), we

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                 conclude that claim preclusion applied because the parties in the 2011
                 case were the same to or in privity with those in the 2008 case, as the
                 cases were coordinated and NCI and RSN both participated in the
                 evidentiary hearing; the final judgment in the 2008 case was valid; and
                 NCI pursued the same claim in the 2011 case as in the evidentiary
                 hearing in the 2008 case.   See Five Star Capital Corp. v. Ruby, 124 Nev.
1048, 1054, 194 P.3d 709, 713 (2008) (setting forth claim preclusion
                 standards), holding modified by Weddell v. Sharp, 131 Nev., Adv. Op. 28,
                 350 P.3d 80 (2015) (modifying the privity element). Further, we conclude
                 that issue preclusion applied because the same fraudulent-inducement
                 issues were raised in the 2011 case as in the 2008 case, the district court's
                 decision on the enforceability of the settlement agreement was on the
                 merits and became final, the parties were again the same or in privity,
                 and the fraudulent-inducement issue was actually and necessarily
                 litigated. See id. at 1055, 194 P.3d at 713. Accordingly, we conclude that
                 no genuine issues of material fact remained, see Wood, 121 Nev. at 729,
                 121 P.3d at 1029, and that the district court properly granted summary
                 judgment on claim and issue preclusion grounds. The December 7, 2012,
                 order in Case No. A-11-637935-B is affirmed.
                 Attorney fees were properly awarded
                             NCI argues that the district court's award of attorney fees and
                 costs in the 2008 case was improper because the court did not limit RSN's
                 fees and costs to those directly related to enforcing the settlement
                 agreement. We review the district court's decision to award attorney fees
                 or costs for an abuse of discretion.       Las Vegas Metro. Police Dep't v.
                 Blackjack Bonding, Inc., 131 Nev., Adv. Op. 10, 343 P.3d 608, 614 (2015).

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                 The district court noted the circumstances and unusual evidentiary
                 hearing and awarded attorney fees and costs based on the settlement
                 agreement's provision entitling a party to receive reasonable fees and costs
                 for successfully enforcing any term of the agreement. NCI has failed to
                 show that the district court relied on a clearly erroneous factual
                 determination or disregarded controlling law.      See id.   NCI's argument
                 regarding paralegal fees also lacks merit.    See Missouri v. Jenkins, 491
U.S. 274, 285 (1989); Las Vegas Metro. Police Dep't v. Yeghiazarian, 129
                 Nev., Adv. Op. 81, 312 P.3d 503, 510 (2013). Thus, we conclude that the
                 district court did not abuse its discretion in awarding attorney fees and
                 costs in the 2008 case and affirm the district court's October 8, 2012, order
                 in Case No. A-08-558139-B.
                             NCI also argues that the district court abused its discretion in
                 awarding attorney fees and costs in the 2011 case because RSN's motion
                 was untimely. A motion for attorney fees must be filed no later than
                 twenty days after notice of entry of judgment is served. NRCP 54(d)(2)(B).
                 Where service is made by electronic means, the prescribed period is
                 extended by three days. NRCP 6(e). RSN's counsel electronically served
                 the notice of entry of judgment in the 2011 case on December 10, 2012.
                 The twenty-day window extended to Monday, December 31, 2012, and the
                 additional three days extended to January 3, 2013.       See NRCP 6(a), (e).
                 RSN filed its motion for attorney fees and costs on January 2, 2013, and
                 thus timely filed its motion. Accordingly, we conclude that the district
                 court did not abuse its discretion in awarding attorney fees and costs in

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                the 2011 case and affirm the district court's November 14, 2013, order in
                Case No. A-11-637935-B. 1
                            Accordingly, we
                            ORDER the judgment of the district court AFFIRMED. 2

                                                                     /       vesaS.      , J.
                                                            Hardesty

                                                            Saitta

                       'We note that Estate of Herrmann, 100 Nev. 1, 677 P.2d 594 (1984),
                is distinguishable for its application of NRAP 4(a), which is not at issue in
                the instant case.

                      2We have considered all other arguments, including those
                concerning whether the legal-malpractice claims were improperly waived
                and whether all matters other than attorney fees and costs are moot, and
                conclude that they lack merit. The district court expressly declined to rule
                on the legal-malpractice-claims release, and this court can provide
                effective relief on matters beyond merely attorney fees and costs, see DHX,
                Inc. v. Allianz AGF MAT, Ltd., 425 F.3d 1169, 1174 (9th Cir. 2005)
                (Beezer, J., concurring).

                      Additionally, we decline to rule on RSN's request for appellate
                attorney fees and costs, which presents a matter of fact that should be
                presented to and ruled upon by the district court in the first instance. See
                Musso v. Binick, 104 Nev. 613, 615, 764 P.2d 477, 478 (1988).

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                   cc: Hon. Elizabeth Goff Gonzalez, District Judge
                        Ara H. Shirinian, Settlement Judge
                        Marquis Aurbach Coffing
                        Holland & Hart LLP/Las Vegas
                        Thorndal Armstrong Delk Balkenbush & Eisinger/Las Vegas
                        Eighth District Court Clerk

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