Court Opinion

ID: 6320566
Source: CourtListenerOpinion
Date Created: 2022-03-07 08:08:20.00052+00
Date Added: 2024-06-11T09:02:37.735665
License: Public Domain

IN THE• SUPREME COURT OF THE STATE OF NEVADA

                   ATHANASIOS SKARPELOS, AN                              No. 79425
                   INDIVIDUAL,
                   Appellant,
                   vs.
                                                                           FILED
                   WEISER ASSET MANAGEMENT, LTD.,
                   A BAHAMAS COMPANY; AND WEISER
                   (BAHAMAS) LTD., A BAHAMAS
                   COMPANY,
                   Res • ondents.
                   WEISER ASSET MANAGEMENT, LTD.,                        No. 79526
                   A BAHAMAS COMPANY; AND WEISER
                   (BAHAMAS) LTD., A BAHAMAS
                   COMPANY,
                   Appellants,
                   vs.
                   ATHANASIOS SKARPELOS, AN
                   INDIVIDUAL,
                   Respondent.

                         ORDER AFFIRMING IN PART, REVERSING IN PART AND
                                          REMANDING

                               These consolidated appeals stem from a civil interpleader
                   action involving competing claims of ownership to a stock certificate
                   representing disputed shares of a pharmaceutical company by
                   appellant/respondent Athanasios Skarpelos and respondents/appellants
                   Weiser Asset Management, Ltd. (WAM) and Weiser (Bahamas) Ltd.
                   (collectively, Weiser). Second Judicial District Court, Washoe County;
                   Elliott A. Sattler, Judge.
                               In 2009, Anavex Life Sciences Corporation issued stock
                   certificate no. 753 (the disputed stock) to Skarpelos. In 2011, Skarpelos
                   funded .a WAM brokerage account with the disputed stock certificate. In
                   2013, Skarpelos had the stock certificate voided and had a new certificate
SUPREME COURT
      OF
    NEVADA

(DI I947A 4402*.                                                               z- 6(277'1
                issued to him. Weiser contended that, shortly thereafter, it sold the
                disputed stock shares and credited Skarpelos with the $249,580 paid for the
                shares. When Skarpelos failed to provide the shares, Weiser contacted the
                company that issued the stock certificate, Nevada Agency and Transfer
                Company (NATCO), and demanded it put the stock certificate in Weiser's
                name.
                            NATCO filed an interpleader action against Skarpelos and
                Weiser to establish ownership of the disputed stock. Skarpelos and Weiser
                filed crossclaims against each other. The case proceeded to trial on the
                crossclaims, at the conclusion of which the district court dismissed Weiser's
                claims and awarded declaratory relief and attorney fees to Skarpelos.
                However, the district court, sua sponte, also awarded restitution to Weiser.
                We affirm in part, reverse in part and remand.
                The district court properly admitted the accounting statement
                            The district court's admission of the WAM account statement
                over Skarpelos's hearsay objection was not a manifest abuse of discretion
                because the court properly determined the statement to be a business record
                under NRS 51.135. This court "review[s] a district court's decision to admit
                evidence for an abuse of discretion." Daisy Tr. v. Wells Fargo Bank, N.A.,
                135 Nev. 230, 232, 445 P.3d 846, 848 (2019). Considerable deference is
                given to the district court's evaluation of evidence. Thomas v. Hardwick,
                126 Nev. 142, 151, 231 P.3d 1111, 1117 (2010).
                            NRS 51.135 provides an exception to the hearsay rule for a
                ‘‘memorandum, report, record or compilation of data . . made at or near the
                time [of the acts, events, conditions, opinions or diagnosis] by . . a person
                with knowledge, all in the course of a regularly conducted activity, as shown
                by the testimony or affidavit of the custodian or other qualified person." The
                2013 account statement provided a summary of the amount of cash on
SUPREME COURT
     Of
   NEVADA
                                                      2
(O l47A me*.
                     deposit for Skarpelos's account and a list of the transactions made from
                     February 1, 2013, to December 31, 2013. The district court found that the
                     statement was made at or near the time of the event, in the course of
                     business, based on the testimony of Weiser's principal, Christos Livadas,
                     that WAM's previous owner provided a printout of the computer records for
                     all accounts at the time he acquired WAM in 2014. Livadas testified at trial
                     that account statements are generally created from the brokerage firm's
                     transaction records. The record demonstrates that the 2013 account
                     statement is reliable because the document was provided along with those
                     of other WAM clients to establish the value of WAM upon purchase.
                     Livadas further testified that WAM's records are audited annually to
                     ensure the firm's accounts and assets balance, and the audit conducted for
                     2013 revealed no discrepancies requiring corrective action.     See United
                     States v. Kail, 804 F.2d 441, 448 (8th Cir. 1986) (stating that
                     Itioundation . . . may also be established by circumstantial evidence, or by
                     a combination of direct and circumstantial evidence."). Livadas need not
                     have firsthand knowledge of the events being entered into the database to
                     qualify as a person with knowledge under NRS 51.135. See Daisy Tr., 135
                     Nev. at 235-36, 445 P.3d at 850. We conclude that Livadas's testimony
                     demonstrated that he had a general knowledge of WAM's recordkeeping
                     system. See, e.g., Thomas v. State, 114 Nev. 1127, 1148, 967 P.2d 1111,
                     1124 (1998) (A 'qualified person required to authenticate the writing has
                     been broadly interpreted as anyone who understands the record-keeping
                     system involved."). The district court did not abuse its discretion in
                     admitting the 2013 account statement as a business record under NRS
                     51.135.

SUPREME COURT
        OF
     NEVADA
                                                          3
to) 1947A    44P15
                   The district court did not err in granting equitable relief to Weiser
                               The district court did not err in granting equitable relief to
                   Weiser.   See Nev. Const., art. 6, § 6 (noting that the district court has
                   "original jurisdiction in all cases excluded by law from the original
                   jurisdiction of justices courts."). Generally, a district court with equitable
                   "jurisdiction of a controversy on any ground and for any
                   purpose . . . retain[s] jurisdiction for the purpose of administering complete
                   relief." Seaborn v. First Judicial Dist. Court, 55 Nev. 206, 222, 29 P.2d 500,
                   505 (1934). Likewise, NRCP 54(c) requires courts to "grant the relief to
                   which each party is entitled, even if the party has not demanded such relief
                   in its pleadings." See also Yount v. Criswell Radovan, LLC, 136 Nev. 409,
                   420, 469 P.3d 167, 175 (2020) (recognizing that NRCP 54(c) "also supports
                   affirmance [by] . allow[ing] a district court to award a party the relief to
                   which they are entitled").
                               Here, the matter before the district court was an equitable,
                   interpleader action. We agree with the district court's determination that
                   restitution was a foreseeable equitable ruling in an action already
                   predicated on equitable principles. See Landex, Inc. v. State ex rel. List, 94
                   Nev. 469, 477, 582 P.2d 786, 791 (1978) ("In the absence of [a statutory]
                   restriction a court of equity rnay exercise the full range of its inherent
                   powers . . . to accomplish complete justice between the parties, restoring if
                   necessary the status quo . . . .").   Even though Weiser did not assert a
                   crossclaim for unjust enrichment against Skarpelos, it did assert unjust
                   enrichment as an affirmative defense to Skarpelos's crossclaim.           See
                   MacDonald v. Krause, 77 Nev. 312, 318, 362 P.2d 724, 727 (1961) (stating
                   that a court sitting in equity may "afford complete equitable relief in one
                   action" for claims of unjust enrichment); see also Grouse Creek Ranches v.
                   Budget Fin. Corp., 87 Nev. 419, 427, 488 P.2d 917, 923 (1971) (stating that
SUPREME COURT
      OF
   NEVADA
                                                          4
O I047A    041§0
                when an "issue was raised and tried, the court [is] empowered by NRCP
                54(c) to grant the relief granted, if such relief [is] legally warranted."). The
                district court found that Weiser proved by a preponderance of the evidence
                that Weiser credited Skarpelos's WAM account nearly $250,000 in April
                2013, and that the evidence showed that Skarpelos received the benefit of
                the money through a series of withdrawals made from the account. See Nev.
                Indus. Dev., Inc. v. Benedetti, 103 Nev. 360, 363 n.2, 741. P.2d 802, 804 n.2
                (1987) (Unjust enrichment occurs whenever a person has and retains a
                benefit which in equity and good conscience belongs to another.").
                Accordingly, we conclude that the district court, through its exercise of
                proper equitable jurisdiction, granted the relief to which both sides were
                entitled, despite discrepancies between pleadings and proof. See Magill v.
                Lewis, 74 Nev. 381 , 387-88, 333 P.2d 717, 720 (1958) (recognizing that
                NRCP 54(c) requires, "that in a contested case the judgment is to be based
                on what has been proved rather than what has been pleaded"); see also
                Benedetti, 103 Nev. at 363 n.2, 741 P.2d at 804 n.2 (Money paid through
                misapprehension of facts belongs, in equity and good conscience, to the
                person who paid it."). Therefore, we affirm the district court's order
                awarding restitution to Weiser.
                The district court properly awarded ownership of the disputed stock to
                Skarpelos
                            The district court did not err in granting Skarpelos's request for
                declaratory relief and awarding ownership of the disputed stock because it
                correctly determined that there was no evidence that a valid contract
                existed between Skarpelos and either of the Weiser entities and that
                Skarpelos was never divested of ownership. "Contract interpretation is
                subject to a de novo standard of review. May v. Anderson, 121 Nev. 668,
                672, 119 P.3d 1254, 1257 (2005). "However, the question of whether a
SUPREME COURT
     OF
   NEVADA
                                                       5
  MTA .460.
                     contract exists is one of fact, requiring this court to defer to the district
                     court's findings unless they are clearly erroneous or not based on
                     substantial evidence." Id. at 672-73, 119 P.3d at 1257.
                                 We see no reason to overturn the district court's determination
                     to award the stock to Skarpelos, because the requirements for the transfer
                     of said ownership were not met. See NRS 78.240 (providing that shares of
                     stock are "personal property and may be transferred "as provided in
                     chapter 104 of NRS"); NRS 104.8304(3) (providing that a valid transfer
                     requires delivery of both the stock certificate and the endorsement "if the
                     endorsement is on a separate docuniene); NRS 104.8102(1)(g) (defining
                      [e]ndorsement'" as "a signature that alone or accompanied by other words
                     is made on a security certificate in registered form or on a separate
                     document for the purpose of assigning, transferring or redeeming the
                     security or granting a power to assign, transfer or redeem it."). Weiser
                     failed to prove an essential term of a contract for the sale of restricted stock
                     because it did not provide the name of the alleged third-party buyer which,
                     according to NATCO's counsel's trial testimony, is one of the steps required
                     to transfer ownership. Weiser's contention that it obtained ownership of
                     the stock through the April 2013 sale relied on Livadas's testimony that the
                     credit in Skarpelos's account was provided in exchange for the disputed
                     stock's ownership. Yet, Livadas conceded at trial that neither WAM nor
                     Weiser Capital owned the stock at issue in the lawsuit. The district court
                     found no evidence of a written sale contract for the disputed stock but
                     determined that there was an oral agreement in April 2013. Because the
                     district court was in the best position to weigh the contradictory evidence
                     presented by Weiser, and its assessment is not clearly erroneous, we defer
                     to the district court's finding that no evidence supported Weiser's ownership

SUPREME COURT
        OF
     NEVADA
                                                            6
(0) 1947A    .040.
                 claim. See Kleernan v. Zigterna, 95 Nev. 285, 287, 593 P.2d 468, 469 (1979)
                 (stating that a district court's credibility determinations "will not be
                 disturbed on appear). For these reasons, we affirm the district court's
                 award of ownership of the disputed stock to Skarpelos.
                 The district court abused its discretion in awarding attorney fees to
                 Skarpelos
                             "The decision to award attorney fees is within the sound
                 discretion of the district court and will not be overturned absent a manifest
                 abuse of discretion." Kahn v. Morse & Mowbray, 121 Nev. 464, 479, 117
                 P.3d 227, 238 (2005) (internal quotation marks omitted). In this case, the
                 district court abused its discretion in awarding attorney fees to Skarpelos,
                 because the record does not support that Weiser unreasonably maintained
                 its claim to ownership of the disputed stock by virtue of the July purchase
                 and sale agreement. See Chowdhry v. NLVH, Inc., 109 Nev. 478, 487, 851
                 1.2d, 459, 464 (1993) (reversing award of attorney fees after concluding that
                 nothing in the record supported the district court's finding of
                 Ct unreasonableness and motivation to harass.").

                             NATCO initiated this litigation, not Weiser or Skarpelos. In its
                 response to Skarpelos's crossclaim, Weiser asserted unjust enrichment as
                 an affirmative defense. Regardless of whether Weiser changed its legal
                 theory during trial, the district court found that credible evidence showed
                 that an agreement to sell the disputed stock existed in April 2013 and that
                 Weiser deposited approximately $250,000 in reliance on that agreement.
                 See Capanna v. Orth, 134 Nev. 888, 895, 432 P.3d 726, 734 (2018) ("[A
                 counter]claim is frivolous or groundless if there is no credible evidence to
                 support it.") (quoting Rodriguez v. Primadonna Co., 125 Nev. 578, 588, 216
                 P.3d 793, 800 (2009)). After determining that Skarpelos was never divested
                 of ownership of the disputed stock, the district court sua sponte awarded
SUPFIEME COURT
        OF
     NEVADA
                                                       7
(0) I947A
                    Weiser restitution of $245,464.64 to prevent Skarpelos from becoming
                    unjustly enriched and obtaining a windfall. See Frantz v. Johnson, 116 Nev.
                    455, 472, 999 P.2d 351, 362 (2000) ("A counterclaim cannot be frivolous as
                    a matter of law when the party asserting the counterclaim actually prevails
                    on the counterclaim."). The district court granted the relief to which both
                    sides were entitled, despite discrepancies between pleadings and proof.
                    Therefore, we reverse the district court's award of attorney fees.
                    Accordingly, we
                                ORDER the judgment of the district court AFFIRMED IN
                    PART AND REVERSED IN PART AND REMAND this matter to the
                    district court for proceedings consistent with this order.

                                                                       •

                                                                                      J.
                                                        Cadish

                                                                                      J.

                                                                                  ,   J.
                                                        Herndon

                    cc:   Chief Judge, Second Judicial District Court
                          Second Judicial District Court, Department 10
                          Lansford W. Levitt, Settlement Judge
                          Woodburn & Wedge
                          Holland & Hart LLP/Reno
                          Washoe District Court Clerk

SUPREME COURT
        OF
     NEVADA
                                                          8
101 1947A    400.