Category: Uncategorized

Must a medical expert’s affidavit accompany a medical malpractice complaint at the time of filing?

Posted on by Jeff Jaeger

Baxter v. Dignity Health (Nev. Supreme Ct. – Sep. 24, 2015)

This case arises from an order dismissing a medical malpractice action under NRS 41A.071. Adopted in 2002 to curb baseless malpractice litigation, NRS 41A.071 provides that a district court shall dismiss a medical malpractice action if the action is filed without an affidavit or declaration from a medical expert supporting the allegations of malpractice. In this case, the plaintiff consulted with a medical expert, from whom he obtained the supporting declaration required, before filing suit. For reasons unclear, the plaintiff did not attach the declaration to the complaint. Instead, he filed the complaint by itself, then filed the separately captioned declaration the next morning. The complaint incorporated the declaration by reference, and vice versa, and the two documents were served together on the defendants before the statute of limitations ran. The issue is whether NRS 41A.071 required dismissal of the complaint.

Baxter is a type 1 diabetic who presented to the emergency room in August 2012 with an acute infection. He alleged that the respondent hospital and doctors committed medical malpractice by misdiagnosing his infection as viral, not bacterial. Baxter further alleged that, had the correct diagnosis been timely made, his cervical spine abscess should and could have been successfully treated with antibiotics. The delay in proper diagnosis and treatment has allegedly left him a ventilator-dependent tetraplegic who will require 24-hour nursing care for the rest of his life.

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When can a court appoint a general guardian for a child?

Posted on by Jeff Jaeger

In re Guardianship of N.M. (Nev. Supreme Ct. – Sep. 24, 2015)

NRS 125A.335 establishes a district court’s temporary emergency jurisdiction to protect a child in Nevada from mistreatment or abuse. The issues are whether a district court exercising temporary emergency jurisdiction may appoint a general guardian pursuant to NRS 125A.335(2) when (1) no court in another jurisdiction has entered an applicable custody order or commenced custody proceedings, and (2) Nevada has become the child’s home state.

Appellant, a Mexican citizen, gave birth to N.M. in California in 2007. Later that year, appellant and N.M. moved to Mexico. In 2008, appellant left N.M. in the care of N.M.’s maternal grandparents, who were also in Mexico. N.M.’s grandmother and two agents from Mexico’s National System for Integral Family Development (DIF) executed a document stating that the grandparents had custody of N.M. (the 2008 DIF document).

In 2009 or 2010, N.M.’s maternal aunt (the Aunt) and respondent, her then-fiancé or boyfriend, began caring for N.M. Respondent is a United States citizen. In August 2011, appellant signed a document purportedly giving the Aunt and respondent custody of N.M.

In September 2012, respondent moved N.M. to Nevada after his relationship with the Aunt ended. Appellant’s half-sister then went to respondent’s home at night and attempted to remove N.M. In response, respondent filed a verified emergency petition in November 2012 for appointment as N.M.’s temporary general guardian. The district court appointed respondent as N.M.’s temporary general guardian.

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When is an insurer obligated to provide independent counsel for its insured?

Posted on by Jeff Jaeger

State Farm Mut. Auto. Ins. Co. v. Hansen (Nev. Supreme Ct. – Sep. 24, 2015)

The Federal District Court for the District of Nevada certified two questions to the Supreme Court of Nevada concerning Nevada’s conflict-of-interest rules in insurance litigation. The first question asked whether Nevada law requires an insurer to provide independent counsel for its insured when a conflict of interest arises between the insurer and the insured. The second asked whether, if the first question is answered affirmatively, the court would find that a reservation of rights letter creates a per se conflict of interest.

While leaving a house party, Hansen was injured in an altercation with other guests. The other party guests tried to prevent Hansen and his friends from leaving the party by sitting on or standing around their vehicle. Eventually Hansen and his friends were able to leave the party in their vehicle, but they later had to stop at the gated exit of the residential subdivision. While stopped at the gate, the vehicle of another party guest, Aguilar, struck the vehicle in which Hansen was riding. Hansen filed a complaint against Aguilar and others in Nevada state district court alleging both negligence and various intentional torts.

Aguilar was insured by State Farm Mutual Automobile Insurance Company. State Farm agreed to defend Aguilar under a reservation of rights. The reservation of rights letter reserved the right to deny coverage for liability resulting from intentional acts and punitive damages.

Aguilar admitted to negligently striking the other vehicle, and the district court granted summary judgment in favor of Hansen on the negligence claim. Aguilar then agreed to a settlement with Hansen, in which he assigned his rights against State Farm to Hansen.

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What determines if a contract’s forum selection clause is permissive or mandatory?

Posted on by Jeff Jaeger

Am. First Fed. Credit Union v. Soro (Nev. Supreme Ct. – Sep. 24, 2015)

The issue is whether a contract clause stating that the parties “submit themselves to the jurisdiction of” another state results in a mandatory forum selection clause requiring dismissal of a Nevada action.

In 2002, America First Federal Credit Union (the credit union) loaned $2 9 million, secured by real property in Mesquite, Nevada, to borrowers for the purchase of a liquor/mini- mart. The borrowers defaulted, and the credit union held a trustee’s sale, resulting in a deficiency on the loan balance of approximately $2.4 million. The Utah-based credit union sued the borrowers in Clark County to recover the deficiency.

The borrowers moved to dismiss the action under NRCP 12(b)(1), arguing that the credit union could not sue to recover the deficiency in Nevada and citing several clauses in the Commercial Promissory Note and Business Loan Agreement to support their argument. An Applicable Law clause in the loan agreement stated that “[t]his Agreement (and all loan documents in connection with this transaction) shall be governed by and construed in accordance with the laws of the State of Utah.” The loan agreement also contained the following: “Jurisdiction. The parties agree and submit themselves to the jurisdiction of the courts of the State of Utah with regard to the subject matter of this agreement.” A clause in the note stated: “If there is a lawsuit, Borrower(s) agrees to submit to the jurisdiction of the court in the county in which Lender is located.”

The district court agreed with the borrowers and granted the motion to dismiss. The district court found that the note and loan agreement contain language which clearly expressed the parties’ intent to submit litigation relating to the Agreement and the Note, to the jurisdiction of the State of Utah. The credit union appealed.

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Can a lender seek a deficiency judgment when the property foreclosed upon is in another state?

Posted on by Jeff Jaeger

Mardian v. Greenberg Family Trust (Nev. Supreme Ct. – Sep. 24, 2015)

The issue is whether NRS 40.455(1) permits deficiency judgments in Nevada when the property foreclosed upon was in another state.

In September 2007, Joshua Tree, LLC, executed a promissory note in the amount of $1,100,000 in favor of the Greenberg Family Trust (Greenberg). The note was secured by a deed of trust encumbering 280 acres of undeveloped real property located in Arizona, and also by personal guaranties, each for the full amount of the note, from the Mardians. Both guaranties stated that they were governed by Nevada law and waived the one-action rule found in NRS 40.430.

The parties agree that Joshua Tree defaulted on the loan and the guaranties were not upheld. In March 2009, Greenberg filed a complaint against the Mardians for breach of contract, breach of the implied covenant of good faith and fair dealing, and unjust enrichment. Greenberg then initiated foreclosure proceedings. A month later, Greenberg purchased the property at auction for $37,617. The property was then relisted for sale at $2,520,000. The price was subsequently reduced and, at the time this appeal was filed, the property had not yet sold.

In December 2009, the Mardians moved the district court to dismiss the underlying complaint for the entire amount due under the promissory note or, alternatively, for summary judgment because a deficiency application for the balance due on the loan was time-barred. Greenberg opposed the motion. At a hearing, the district court determined that it would not apply the limitations period in NRS 40.455 because the property was located in Arizona and sold pursuant to Arizona law, not Nevada law. Therefore, the district court indicated, neither Arizona’s nor Nevada’s limitations period applied. The court later entered an order denying the Mardians’ motion.

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Does a party’s failure to sign an arbitration agreement make it unenforceable?

Posted on by Jeff Jaeger

Mike v. Eighth Jud. Dist. Ct. (Nev. Supreme Ct. – Sep. 24, 2015)

Petitioners Mika, Harter, and Tallman sought writs of mandamus directing the district court to vacate its orders compelling arbitration of their claims against their former employer, CPS Security (USA), Inc., and certain of its agents and associates (collectively, CPS). All three petitioners signed the same long- form arbitration agreement, which included a clause waiving the right to initiate or participate in class actions. They urged the Supreme Court of Nevada to invalidate the agreement because, among other issues, it was not countersigned by CPS.

The issue is whether CPS’s failure to sign the long-form agreement made it unenforceable and that the short-form agreement, which CPS did sign and which did not include a class action waiver clause, therefore controlled.

CPS provided security services to construction companies in Nevada and elsewhere. Petitioners worked 50 to 70 hours per week for CPS as trailer guards. As a condition of their employment, CPS required petitioners to sleep overnight in small trailers located at its work sites. CPS did not pay petitioners for their sleep time except when they were called out to respond to an alarm or other activity at the site. Petitioners alleged, and CPS denied, that they are owed at least the minimum wage for the required on-site sleep time, whether called out during the night or not, as well as overtime pay.

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When does a subordination agreement affect the priority of a mechanic’s lien?

Posted on by Jeff Jaeger

In re Manhattan W. Mechanic’s Lien Litig. (Nev. Supreme Ct. – Sep. 24, 2015)

The issue is whether a subordination agreement that subordinates a lien for original land financing to a new construction deed of trust affects the priority of a mechanic’s lien for work performed after the date of the original loan but before the date of the construction deed of trust.

Gemstone Apache, LLC (Apache), intended to develop a mixed-use property (Manhattan West) in Las Vegas. Real party in interest Scott Financial Corporation (SFC) made multiple loans to Apache for this purpose. The first three loans, which were recorded in July 2006, totaled $38 million (the Mezzanine Deeds of Trust) and financed the purchase of the property. In April 2007, petitioner APCO Construction (APC0),1the contractor hired by Apache, began construction on Manhattan West, setting the priority date for mechanic’s lien services. In May and October of 2007, the Mezzanine Deeds of Trust were amended to secure additional funds for the project.

In early 2008, Gemstone Development West, LLC (GDW), purchased Manhattan West from Apache, assuming Apache’s loan obligations. To obtain financing for construction, GDW borrowed an additional $110,000,000 from SFC (the Construction Deed of Trust), recording the deed of trust on February 7, 2008. As part of the overall transaction, SFC and GDW entered into a subordination agreement subordinating the Mezzanine Deeds of Trust to the Construction Deed of Trust. SFC indicated that its intent for the subordination agreement was for SFC to determine in what order SFC’s debts would be satisfied. The subordination agreement did not state whether the subordination was complete or partial, nor did it address the priority of any potential mechanics’ liens.

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When does a mutual mistake at the time a contract is made provide a ground for rescission?

Posted on by Jeff Jaeger

Land Baron Invs. v. Bonnie Springs Family LP (Nev. Supreme Ct. – Sep. 17, 2015)

This case arises from a failed land sale contract. The issue is whether a mutual mistake will provide a ground for rescission where one of the parties bears the risk of mistake.

In 2004, Land Baron Investments, Inc., contracted to purchase land for $17,190,000 from Bonnie Springs Family Limited Partnership and Bonnie Springs Management Company (collectively, Bonnie Springs) for the express purpose of building a subdivision. The property lies next to the Bonnie Springs Ranch, beyond the outskirts of Las Vegas and is surrounded largely by undeveloped land.

Prior to signing the purchase agreement, Land Baron verified that Bonnie Springs had title to the property but did not inquire into water or access rights or do any other due diligence. Land Baron drafted the purchase agreement, which stated that Bonnie Springs would allow Land Baron to use some of its treated wastewater for landscaping, but did not mention access or water rights or make the contract contingent upon its ability to secure access, water, or any other utility necessary for the planned subdivision. Immediately after signing the agreement and while the sale was pending, Land Baron also began listing and relisting the property for sale, first as a single piece of property and then as separate parcels. However, obtaining access and water proved to be difficult, and beginning in December 2004, the parties amended the purchase agreement five times to extend the escrow period, with Land Baron paying a nonrefundable fee of $50,000 for each extension.

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Can a plaintiff appeal a court order that dismisses a complaint?

Posted on by Jeff Jaeger

Bergenfield v. BAC Home Loans Servicing (Nev. Supreme Ct. – Sep. 10, 2015)

The issue is whether a plaintiff can appeal from a district court order that dismisses a complaint but allows the plaintiff leave to amend.

The Bergenfields filed a complaint against BAC Home Loans Servicing, LP, asserting fraud and consumer fraud. BAC moved to dismiss the complaint. The district court granted BAC’s motion to dismiss but allowed the Bergenfields leave to file an amended complaint. The Bergenfields then filed a first amended complaint, once again asserting fraud and consumer fraud. Again, the district court dismissed it, allowing the Bergenfields leave to amend. However, instead of filing a second amended complaint, the Bergenfields appealed. The Nevada Supreme Court issued an order to show cause why the appeal should not be dismissed for lack of jurisdiction.

The Court noted that in the United States Court of Appeals for the Ninth Circuit, an order dismissing a complaint with leave to amend is not final and, thus, not appealable. A plaintiff, who has been given leave to amend, may not file a notice of appeal simply because he does not choose to file an amended complaint. A plaintiff must obtain a further district court determination. A plaintiff obtains such a determination by filing in writing a notice of intent not to file an amended complaint. Filing of such notice gives the district court an opportunity to reconsider, if appropriate, but more importantly, to enter an order dismissing the action, one that is clearly appealable.

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Can a court be prohibited from staying an administrative board’s decision?

Posted on by Jeff Jaeger

Tate v. State, Bd. of Med. Exam’rs (Nev. Supreme Ct. – Sep. 10, 2015)

NRS 630.356(1) grants physicians the right to judicial review of Nevada State Board of Medical Examiners final decisions, while NRS 630.356(2) simultaneously prohibits district courts from entering a stay of the Board’s decision pending judicial review. The issue is whether this prohibition violates the Nevada Constitution’s separation of powers doctrine.

Tate is a surgeon licensed in Nevada. In February 2010, he was scheduled to perform a surgery at Valley Hospital at around 4 p.m. When he arrived to prepare for the surgery, members of the surgical team thought Dr. Tate smelled of alcohol. The hospital halted surgery preparations and asked Dr. Tate to submit to alcohol tests, which he did, admitting that he had consumed some alcohol during his lunch break. Dr. Tate’s blood alcohol level was .06 percent.

The Nevada State Board of Medical Examiners found that Dr. Tate had violated NAC 630.230(1)(c) by rendering services to a patient while under the influence of alcohol and in an impaired condition. The Board suspended Dr. Tate’s license for six months, issued a public reprimand, ordered him to complete an alcohol diversion program and pay $35,564.44 in investigation and prosecution costs and a $5,000 fine, and to complete continuing medical education on the subject of alcohol.

Dr. Tate petitioned for judicial review of the Board’s decision. He also requested a preliminary injunction to stay the sanctions and prevent the Board from filing a report with the National Practitioner Data Bank while judicial review was pending. Medical Boards are required by 45 C.F.R. §§ 60.5(d) and 60.8(a) to report sanctions to the National Practitioner Data Bank, which disseminates information of physician misconduct to health-care entities, including hospitals. In denying injunctive relief, the district court stated that, even though it thought the injunction was clearly warranted, NRS 630.356(2) precluded such action. Dr. Tate appealed the district court’s denial of his injunction request.

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