Court Opinion

ID: 2768900
Source: CourtListenerOpinion
Date Created: 2015-01-12 16:07:11.598476+00
Date Added: 2024-06-11T11:27:34.961536
License: Public Domain

originally owned by Tassely (Vacant Lot), and a separate house purchased
                 by Consulting and Holding, LLC (Branding Iron).
                             After concluding that he needed to sell property to keep
                 Montecito, Tassely and Mr. Posner entered into a general agreement
                 (Initial Agreement) prepared by or at the direction of Mr. Posner for that
                 purpose. The day after Tassely executed the agreement, Mr. Posner
                 signed it, but only after inserting handwritten notes that purported to
                 include Tassely's equity interest in Montecito.
                             Mr. Posner and Tassely subsequently engaged in a series of
                 transactions related to Vacant Lot. In exchange for, among other things, a
                 non-interest bearing promissory note for $240,000.00 (Vacant Lot Note)
                 signed by the Posners, Tassely transferred title to Vacant Lot to Posner
                 Investments, Inc. After the Posners defaulted on payments required by
                 the terms of the Vacant Lot Note on March 3, 2008, Tassely accelerated all
                 amounts due. Ultimately, the district court concluded that the Posners
                 owed Tassely $118,999.00 plus interest from and after March 3, 2008, on
                 the Note.
                             Later, Mr. Posner, Consulting and Holding, LLC (C&H), and
                 MSG Design, LLC entered into an agreement with two other parties for
                 the purchase and sale of a house and real property (Branding Iron). 1 The
                 agreement identified MSG as a partner with C&H and mentioned a
                 "partnership interest." The agreement also required the delivery of cash
                 and personal property in the amount of $100,000.00, which Tassely
                 provided, acting on behalf of MSG. In connection with the purchase

                      'Posner signed the agreement individually and on behalf of C&H,
                 and Tassely signed the agreement on behalf of MSG only.

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                agreement, Mr. Posner, individually and on behalf of C&H, executed and
                delivered to MSG a promissory note for $100,000.00 (Branding Iron Note).
                The Note provides that upon the sale of Branding Iron, C&H will pay
                MSG $100,000.00 plus one-half of the equity in the property, less
                maintenance costs. The Note also contained a provision requiring
                payment in full after five years. Mr. Posner, individually and on behalf of
                C&H, executed a trust deed to secure performance under the Branding
                Iron Note. MSG then assigned its rights under the Note and Trust Deed
                to Tassely.
                              When the market crashed, the Branding Iron property was
                foreclosed upon and the $100,000.00 equity interest was lost. On June 2,
                2009, the Branding Iron Note's $100,000.00 balloon payment provision
                became effective. Posner and C&H never paid Tassely the $100,000.00.
                Sanctions
                              During discovery, appellants' counsel failed to timely respond
                to respondents' requests for admission. Due to this and other errors, the
                discovery commissioner recommended that, inter alia, the district court
                sanction appellants for $4,000.00 and deem the untimely responses to the
                requests for admission admitted. The district court accepted the discovery
                commissioner's recommendation, but reduced the sanctions to $2,000.00.
                Based on this, respondents filed a motion in limine to prevent appellants
                from presenting evidence contrary to the requests for admission deemed
                admitted. Appellants filed an opposition to the motion and a
                countermotion to strike the sanctions related to the admissions for being
                unconstitutional. After a hearing, the district court rejected appellants'
                constitutional argument but reinstated their answers to the requests for
                admission, substituting a monetary sanction under NRCP 37 for

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                  $11,218.75. The monetary sanction was later deducted from respondents'
                  award of attorney fees.

                                                  DISCUSSION

                  Initial Agreement

                               Based on their contention that the Initial Agreement was an
                  enforceable contract, appellants argue that they are entitled to at least a
                  $250,000.00 offset from the judgment from the Montecito equity interest,
                  and therefore, owe respondents nothing. 2 Respondents assert that the
                  district court's finding that the Initial Agreement was unenforceable is
                  supported by substantial evidence.
                               "[W]hether a contract exists is [a question] of fact, requiring
                  this court to defer to the district court's findings unless they are clearly
                  erroneous or not based on substantial evidence."      Certified Fire Prot., Inc.
                  v. Precision Constr., Inc., 128 Nev. , , 283 P.3d 250, 255 (2012)
                  (alterations in original) (internal quotation omitted). "Basic contract
                  principles require, for an enforceable contract, an offer and acceptance,
                  meeting of the minds, and consideration." Id. (internal quotation omitted).
                  For a meeting of the minds to exist, the parties must have agreed about
                  the contract's essential terms. Id.
                              We conclude that substantial evidence supports the district
                  court's finding that the Initial Agreement was unenforceable because
                  there was no meeting of the minds. The record shows that Tassely signed

                        2Appellants'  argument that the district court could not consider the
                  enforceability of the Initial Agreement lacks merit because they brought
                  that contract's validity into issue by raising it as the basis for their offset
                  claim.

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                 the agreement before Mr. Posner inserted his additional terms and
                 signature. It would be unreasonable to say that Tassely intended, post
                 execution, to be bound by new terms unilaterally added by Mr. Posner,
                 such as the inclusion of the Montecito equity interest. Because the
                 inclusion of that equity interest would have been an essential term,
                 substantial evidence supports the district court's finding that there was no
                 meeting of the minds, and therefore, the Initial Agreement was
                 unenforceable.
                 Partnership
                             Appellants next argue that because the Branding Iron
                 purchase agreement created a partnership or joint venture between
                 appellants and respondents, respondents have no right to the $100,000.00
                 owed on the Branding Iron Note. Appellants also contend that
                 respondents have no right to that money because the contingency
                 triggering payment—the property's sale—never occurred. Respondents
                 urge us to defer to the district court's determination that no partnership
                 existed and that the $100,000.00 is due.
                             Whether a partnership or joint venture arises out of a written
                 agreement is a question of fact.   See Dieleman u. Sendlein, 99 Nev. 768,
                 769-70, 670 P.2d 578, 579 (1983); see also Radaker u. Scott, 109 Nev. 653,
                 658, 855 P.2d 1037, 1040 (1993) (stating that "principles of law regarding
                 general partnerships encompass joint ventures"). "[A] partnership is an
                 association of two or more persons to carry on as co-owners a business for
                 profit," NRS 87.060(1), whereas "[a] joint venture is a contractual
                 relationship in the nature of an informal partnership wherein two or more
                 persons conduct some business or enterprise, agreeing to share jointly, or

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                 in proportion to capital contributed, in profits and losses."   Bruttomesso v.
                 Las Vegas Metro. Police Dep't, 95 Nev. 151, 154, 591 P.2d 254, 256 (1979).
                             Although the Branding Iron purchase agreement stated that
                 MSG was a partner with C&W, the agreement did not relate to or create a
                 business for profit, and thus, did not create a partnership. Moreover, we
                 conclude that the agreement was insufficient alone to create a joint
                 venture because it failed to identify a business objective between
                 appellants and respondents and did not speak to the parties jointly or
                 proportionally sharing profits and losses. Having determined that the
                 agreement created neither a partnership nor a joint venture, we next
                 consider whether the $100,000.00 owed on the Branding Iron Note was
                 contingent upon the property's sale.
                              We review contractual interpretation de novo.      Anvui, LLC v.
                 G.L. Dragon, LLC, 123 Nev. 212, 215, 163 P.3d 405, 407 (2007). When a
                 contract's language is unambiguous, this court will interpret that
                 language according to its plain meaning.       Dickenson v. State, Dep't of
                 Wildlife, 110 Nev. 934, 937, 877 P.2d 1059, 1061 (1994). Although poorly
                 written, the repayment terms are unambiguous when reading the Note as
                 a whole. The terms provide that appellants are required to repay the full
                 $100,000.00 plus one-half of the equity interest in the Branding Iron
                 property upon its sale and, if the property is not sold, to repay any balance
                 on the loan in full after June 2, 2009. Accordingly, the district court
                 properly construed this contract by requiring payment of the loan in full
                 plus interest from and after June 2, 2009. 3

                        3 We reject appellants' allegation of improper judicial conduct by the
                 district court because (1) they failed to offer evidence that they preserved
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                   Sanctions
                                Appellants next argue that the district court abused its
                   discretion by deeming admitted their tardy answers to respondents'
                   requests for admission. Moreover, appellants contend that the district
                   court impermissibly conditioned their right to go to trial on their payment
                   of $11,218.75 and violated their due process by not allowing them the
                   opportunity to submit evidence or assert a defense. Respondents assert
                   that the district court's reinstatement of appellants' untimely answers and
                   deduction of the sanctions from respondents' award of attorney fees
                   renders this issue moot.
                                This court has "a duty to decide actual controversies by a
                   judgment which can be carried into effect, and not to give opinions upon
                   moot questions or abstract propositions, or to declare principles of law
                   which cannot affect the matter in issue before [it]."   Majuba Mining, Ltd.
                   v. Pumpkin Copper, Inc., 129 Nev. , 299 P.3d 363, 364 (2013)
                   (internal quotation omitted). A moot question is one that has no practical

                   . . . continued

                   the claim below, (2) they waited too long before raising the allegation, and
                   (3) the record does not support the allegation. See Foley v. Morse &
                   Mowbray, 109 Nev. 116, 120, 848 P.2d 519, 521 (1993) (stating that a
                   party must make a specific objection at trial to preserve a claim of judicial
                   misconduct); Ainsworth v. Combined Ins. Co. of Am., 105 Nev. 237, 260,
                   774 P.2d 1003, 1019 (1989) (explaining that when counsel knows of facts
                   that would support a motion for reconsideration, recusal, or vacatur based
                   on judicial "bias and impropriety[, counsel] may not lie in wait and raise
                   those allegations . . . only after learning the court's ruling on the merits"
                   (internal quotations omitted)), abrogated on other grounds by Powers v.
                   United Servs. Auto. Ass'n, 114 Nev. 690, 962 P.2d 596 (1998).

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                significance. See Black's Law Dictionary 1099 (9th ed. 2009). Appellants'
                arguments on this issue have no practical significance because the district
                court reinstated appellants' answers to respondents' requests for
                admission and deducted the monetary sanctions from respondents' final
                award of attorney fees. Accordingly, this issue is moot and we need not
                decide it. 4
                               We therefore ORDER the judgment of the district court
                AFFIRMED.

                                                               , C.J.

                                                           Saitta

                                                               Pitfeu ity

                cc:    Hon. Ronald J. Israel, District Judge
                       Jerry J. Kaufman, Settlement Judge
                       Robert W. Lueck, Esq.
                       Nitz Walton & Heaton, Ltd.
                       Eighth District Court Clerk

                       4We  also decline to consider appellants' challenge to the
                constitutionality of SCR 123 as it was not properly raised.

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