Court Opinion

ID: 2775528
Source: CourtListenerOpinion
Date Created: 2015-02-02 16:08:05.1493+00
Date Added: 2024-06-11T11:27:57.854379
License: Public Domain

by the Nevada Gaming Commission. Based on this investigation, Vegas
                 South withdrew its liquor license applications and sought to change
                 ownership. A dispute arose between the parties over whether Vegas
                 South had breached the leases, which resulted in Vegas South ceasing
                 operation of the poolside food and beverage venue and a delay in the
                 opening of the burlesque lounge.
                             Vegas South commenced the underlying district court actions
                 seeking, among other things, to prevent Mandalay from terminating the
                 burlesque lounge lease and to recover damages from Mandalay resulting
                 from the closure of the poolside food and beverage venue.' The district
                 court ultimately granted summary judgment in favor of Mandalay and
                 against Vegas South for breach of the leases. Vegas South appealed. For
                 the following reasons, we affirm.
                 Standard of Review
                             This court reviews a district court's order granting summary
                 judgment de novo. Francis v. Wynn Las Vegas, 127 Nev. „ 262 P.3d
                 705, 714 (2011). Summary judgment is proper only when "the pleadings,
                 depositions, answers to interrogatories, and admissions on file, together
                 with the affidavits, if any, show that there is no genuine issue as to any
                 material fact and that the moving party is entitled to a judgment as a
                 matter of law." NRCP 56(c). "[VV]hen reviewing a motion for summary
                 judgment, the evidence, and any reasonable inferences drawn from it,

                        'Vegas South sought damages from Mandalay under the theory of
                 unjust enrichment. Vegas South claimed that Mandalay appreciated,
                 accepted, and retained its estimated $450,000 in improvements to the
                 poolside food and beverage venue, which created an implied contact.
                 Accordingly, Vegas South argued, it would be inequitable for Mandalay to
                 retain the benefit of the improvements without payment for their value.

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                must be viewed in a light most favorable to the nonmoving party."      Wood
                v. Safeway, Inc., 121 Nev. 724, 729, 121 P.3d 1026, 1029 (2005).
                            Under Nevada law, a contract must be read as a whole, giving
                meaning to all provisions. Ringle v. Bruton, 120 Nev. 82, 93, 86 P.3d 1032,
                1039 (2004). Moreover, this court "construe[s] a contract that is clear on
                its face from the written language," and will enforce the contract as
                written. State ex rel. Masto v. Second Judicial Dist. Court, 125 Nev. 37,
                44, 199 P.3d 828, 832 (2009). Construction of a contract term is a question
                of law that this court reviews de novo. Anvui, LLC v. G.L. Dragon, LLC,
                123 Nev. 212, 215, 163 P.3d 405, 407 (2007).
                Breach for failing to obtain a liquor license
                            Vegas South argues that the district court erroneously
                concluded that it breached the liquor license provision of the Rose Lease.
                It argues that any delay in the issuance of the liquor license resulted from
                Mandalay's insistence that the parties amend the lease. Neither its
                citations nor the record, however, supports this position. Vegas South
                withdrew its application voluntarily, likely because it knew that its
                principals would not be awarded a license in light of the Prive
                investigation. Further, the principals never submitted a subsequent
                application. Vegas South cites to Clark County Code of Ordinances §
                8.20.030 for the proposition that it needed to withdraw its application to
                provide a valid, current lease. However, this provision of the Code does
                not require that the application be withdrawn, prohibit supplementation
                of the application with the updated lease, or prohibit changes to the
                application. Clark Cnty. Code of Ordinances § 8.20.030. More
                importantly, Vegas South's argument fails because the Rose Lease was

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                  still valid, therefore complying with § 8.20.030. Vegas South had no
                  reason to withdraw the application based on the still-valid lease.
                              Because Vegas South withdrew its application without
                  justification, we conclude that it defaulted on the lease. The Rose Lease
                  required that Vegas South immediately apply for a liquor license and
                  provided that if Vegas South was "unable to obtain a liquor license or has
                  its liquor license suspended, limited or revoked, such failure will
                  constitute an event of default and result in the immediate termination of
                  this Lease." While there was no deadline set for obtaining the liquor
                  license, time was clearly of the essence where the lease required an
                  "immediate" application for the license. Moreover, even if time was not of
                  the essence, Vegas South could not have performed within a reasonable
                  time without an application pending. Mayfield v. Koroghli, 124 Nev. 343,
                  349, 184 P.3d 362, 366 (2008) ("If time is not of the essence, the parties
                  generally must perform under the contract within a reasonable time,
                  which depends upon the nature of the contract and the particular
                  circumstances involved." (footnote and internal quotation omitted)). We
                  therefore conclude that Vegas South breached this material provision in
                  the contract.   See Covington Bros. v. Valley Plastering, Inc., 93 Nev. 355,
                  360, 566 P.2d 814, 817 (1977) (stating that anticipatory repudiation of a
                  contract occurs when one party's nonperformance is "clear, positive, and
                  unequivocal . . . in light of the total factual context of the individual case."
                  (citation omitted)); Finnell v. Bromberg, 79 Nev. 211, 225, 381 P.2d 221,
                  228 (1963) ("Where a party bound by an executory contract repudiates his
                  obligation before the time for performance, the promisee. . . [may] treat the
                  contract as ended . . . [and] maintain an action at once for the damages

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                occasioned by such anticipatory breach." (emphasis added) (quoting 17
                C.J.S. Contracts § 472, at p. 973)).
                Breach for failure to pay rent
                            Vegas South argues that their failure to pay rent did not
                constitute a breach of the Rose Lease because Mandalay's general counsel,
                William Martin, verbally informed Vegas South that Mandalay did not
                expect rent until the parties finalized the Third Amendment to the lease.
                We conclude that Vegas South breached the Rose Lease by failing to pay
                rent because Mandalay did not waive or modify the rental terms, as
                specified in section 27.13(b) of the Rose Lease. In order to effectuate a
                modification or waiver of contract terms, section 27.13(b) provides that
                "[n]o term . . . required to be performed . . . shall be waived, altered or
                modified except by a written instrument executed by the other party."
                (Emphasis added.) Under the lease, Mandalay needed to provide a rental
                modification or waiver in writing; Martin's verbal statements do not
                represent an adequate waiver or modification of the Rose Lease. Further,
                any alterations to the Rose Lease terms must have been executed by the
                other party. Accordingly, no modification or waiver of the terms of the
                Rose Lease could take effect. Because Vegas South did not provide
                evidence of a waiver or modification that satisfies the procedure outlined
                in Section 27.12(b) of the Rose Lease, their argument fails.
                            Vegas South also argues that Mandalay cannot recover any
                rent accrued after termination of the Rose Lease in December 2009, as
                Mandalay did not make an effort to attract replacement tenants. It
                argues that Mandalay had a duty to mitigate damages after termination of
                the Lease and can therefore only recover rent accrued prior to the
                termination of the Rose Lease in December 2009. Regardless of section

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                      24.2(b)'s terms regarding Vegas South's rent liability after termination of
                      the Rose Lease, Mandalay only sought past due rent accrued before the
                      Lease termination in December 2009. Neither party disputes the rental
                      amounts before the termination of the Lease or that they are still owed.
                      Accordingly, Vegas South's claim that Mandalay failed to mitigate
                      damages after December 2009 is irrelevant, and their argument fails
                                  We have considered Vegas South's remaining issues on appeal
                      and concluded that they are without merit.
                                 Accordingly, we
                                  ORDER the judgment of the district court AFFIRMED.

                                                         Hardesty

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                      cc: Hon. Susan Scann, District Judge
                           Stephen E. Haberfeld, Settlement Judge
                           Kolesar & Leatham, Chtd.
                           Pisanelli Bice, PLLC
                           Eighth District Court Clerk

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