Justia Contracts Opinion Summaries

Hi-Tech Aggregate, LLC supplied Pavestone, LLC with aggregate used to manufacture pavers. After customers complained about efflorescence on the pavers, Pavestone determined that sodium carbonate in Hi-Tech’s aggregate caused the issue. Pavestone sued Hi-Tech for negligence, products liability, breach of contract, and breach of warranty. The district court ruled in favor of Pavestone on the breach of warranty and products liability claims.The Eighth Judicial District Court of Clark County conducted a bench trial and found that Hi-Tech breached the warranty of fitness for a particular purpose and was liable under products liability. Hi-Tech appealed the decision, arguing that it did not know of Pavestone’s specific need for sodium-free aggregate and that the economic loss doctrine barred Pavestone’s tort claims.The Supreme Court of Nevada reviewed the case. It held that Hi-Tech’s sale of aggregate carried an implied warranty of fitness for a particular purpose because Hi-Tech had reason to know Pavestone’s intended use. The court adopted the reasoning of UCC § 2-315, which does not require proof of a seller’s actual knowledge if the seller had reason to know the product’s intended purpose. The court also held that Pavestone was excused from testing the aggregate for sodium carbonate because the defect was latent and not detectable through a simple examination.However, the court reversed the district court’s ruling on the products liability claim, holding that the economic loss doctrine precluded Pavestone’s noncontractual claims. The doctrine applies when the damage is to the product itself and not to other property. Pavestone did not provide sufficient evidence of damage to property other than the pavers. Thus, the Supreme Court of Nevada affirmed the district court’s judgment on the warranty claim but reversed its judgment on the products liability claims. View "Hi-Tech Aggregate, LLC v. Pavestone, LLC" on Justia Law

In this case, the Supreme Court of the State of Nevada considered a dispute between LaMont’s Wild West Buffalo, LLC and Nathanial Terry. LaMont’s had acted as an order-buyer to procure 517 bison for Terry’s Montana ranch under an oral agreement. After the bison were delivered, Terry ceased communication and did not pay LaMont’s finder’s fee. LaMont’s sued Terry for breach of contract and related claims. In response, Terry filed frivolous counterclaims, which were later dismissed.After winning the case, LaMont’s sought attorney fees as sanctions under Nevada Rules of Civil Procedure (NRCP) 11 and Nevada Revised Statutes (NRS) 18.010(2)(b) and 7.085. However, the district court denied these motions, finding that LaMont’s had not complied with NRCP 11's safe harbor provision, a procedural requirement for seeking sanctions.On appeal, the Supreme Court of Nevada affirmed in part and reversed in part the lower court's decision. The Court agreed that LaMont’s had not complied with NRCP 11's procedural requirements, and thus was not entitled to attorney fees under this rule. However, the Court held that these procedural requirements did not apply to NRS 18.010(2)(b) and 7.085. The Court concluded that these statutes provided independent mechanisms for sanctions, and as such, the district court had erred in applying NRCP 11's procedural requirements to them. The case was remanded with instructions for the district court to determine whether LaMont’s was entitled to attorney fees under these statutes. View "LaMont's Wild W. Buffalo, LLC v. Terry" on Justia Law

In a personal injury case, Alejandro Lopez Aguilar, the appellant, had filed a lawsuit against Lucky Cab Co. and Adugna Demesash, the respondents. Before trial, Lucky Cab made an offer of judgment to Aguilar for a lump sum of $150,001, explicitly stating that this amount did not include prejudgment interest, attorney fees, and costs incurred to date. Aguilar accepted the offer. Lucky Cab sent Aguilar both a check for $150,001 and a stipulation and order for dismissal. However, Aguilar did not process the check or consent to the dismissal, arguing that Lucky Cab had not fully paid the offer amount as it had not yet paid any costs or prejudgment interest. The district court granted dismissal with prejudice, concluding that Lucky Cab was entitled to dismissal once it tendered payment within the stipulated window. Aguilar appealed.The Supreme Court of Nevada reversed the district court’s decision. The high court clarified that when an offer of judgment explicitly excludes costs, expenses, interest, and attorney fees, it promises two sums if accepted: (1) the principal amount for the claim(s), specified in the offer; and (2) a separate amount for costs, expenses, interest, and attorney fees that would be recoverable if a judgment were entered based on that offer. Consequently, under Nevada Rule of Civil Procedure (NRCP) 68(d)(2), an offeror cannot obtain dismissal unless they pay both the principal offer and the additional allowance for costs, expenses, interest, and attorney fees. In this case, Lucky Cab did not pay the pre-offer costs and interest that were promised and that Aguilar would be entitled to as a prevailing party. The case was remanded for the district court to determine the amount of awardable pre-offer costs and interest that Lucky Cab must pay to obtain dismissal. View "Aguilar v. Lucky Cab Co." on Justia Law

In the underlying breach of contract action the Supreme Court affirmed the orders of the district court denying Appellants relief under Nev. R. Civ. P. 60(b)(1), Nev. R. Civ. P. 60(b)(5) and Nev. R. Civ. P. 60(b)(6) after the district court granted Respondents' motion for sanctions and dismissed the case with prejudice, holding that there was no error.Appellants sued Respondents on claims sounding in breach of contract. After three years of Appellants failed to comply with various discovery requirements and court orders Respondents moved for sanctions seeking dismissal with prejudice. The district court granted the motion. Appellants moved to set aside the sanctions order, and the district court denied relief. The Supreme Court affirmed, holding (1) as to the denial of Appellants' Nev. R. Civ. P. 60(b)(1) motion, the district court's decision was supported by substantial evidence; (2) as to the denial of Appellants' Nev. R. Civ. P. 60(b)(5) motion, this rule was not an appropriate vehicle by which Appellants could obtain relief; and (3) as to the denial of Appellants' Nev. R. Civ. P. 60(b)(6) motion, the district court did not abuse its discretion. View "Willard v. Berry-Hinckley Industries" on Justia Law

The Supreme Court reversed the order of the district court as to Appellants' motions to compel arbitration and remanded the case, holding that "where the nonsignatory seeking to compel arbitration demonstrates both the right to enforce the contract and that compelling another nonsignatory to arbitration is warranted under standard principles of contract law or estoppel, compelling arbitration is appropriate."At issue was whether a nonsignatory to a contract containing an arbitration clause can be compelled to participate in arbitration by another signatory. The district court denied both Appellants' first and second motions to compel arbitration. The Supreme Court reversed as to Appellants' first and second motions to compel arbitration, holding where a nonsignatory to a contract containing an arbitration provision moves to compel another nonsignatory to arbitrate, the nonsignatory seeking to compel arbitration must demonstrate the right to enforce the arbitration agreement and show that compelling the other nonsignatory to arbitration is warranted. View "RUAG Ammotec GmbH v. Archon Firearms, Inc." on Justia Law

The Supreme Court reversed the order of the district court enforcing a noncompete covenant against three of its former employees (collectively, Respondents) on the basis that the covenant was unenforceable due to procedural unconscionability, holding that the court erred in invalidating the covenant based on procedural unconscionability and in failing adequately to consider whether the overbroad scope of the covenant could be modified.In determining that the noncompete agreement was unenforceable, the district court called into question whether employees could readily ascertain its terms and found that the noncompete covenant was overbroad. The court, however, declined to modify the covenant, stating that it could be redrafted in a manner to allow for injunctive relief. The Supreme Court reversed the portion of the order denying injunctive relief as to the noncompete provision, holding that the district court (1) erred in invalidating the noncompete covenant as procedurally unconscionable and therefore unenforceable as a matter of law; and (2) failed properly to analyze whether the noncompete covenant could be revised under Nev. Rev. Stat. 613.195(6). View "Tough Turtle Turf, LLC v. Scott" on Justia Law

The Supreme Court affirmed the judgment of the district court dismissing the complaint brought by a first deed of trust holder against its title insurance company for breach of contract and related claims, holding that there was no error.The insurer in this case denied coverage to a first deed of trust holder for its loss of interest in property following a foreclosed upon a "superpriority piece." At issue was whether the first deed of trust holder could recover for its loss of interest in the subject property by making a claim on its title insurance policy. The district court granted the title insurance company's motion to dismiss as to all claims, concluding that no coverage existed under the policy. The Supreme Court affirmed, holding (1) the claims for declaratory judgment, breach of contract, and breach of the covenant of good faith and fair dealing were properly dismissed; and (2) the first deed of trust holder was not entitled to relief on its remaining allegations of error. View "Deutsche Bank National Trust v. Fidelity National Title Insurance Co." on Justia Law

The Supreme Court reversed the portion of the order of the district court granting summary judgment in favor of Buyer in this dispute arising from an ordinary course covenant in an asset purchase agreement, holding that the district court erred in granting summary judgment for Buyer.In April 2019, Seller entered into an agreement to sell a casino and hotel to Buyer. The agreement contained an ordinary course covenant requiring Seller to operate its business in the usual manner between the time the agreement was signed and closing. In March 2020, in response to the COVID-19 pandemic, Seller complied with the Governor's emergency directive mandating closure of all nonessential businesses. The pandemic also affected Buyer's duties under the agreement. Buyer subsequently terminated the agreement and sued Seller for return of the deposit, alleging various contract claims. Seller counterclaimed for breach of contract. The district court granted summary judgment for Buyer. The Supreme Court reversed, holding that Seller did not violate the agreement's ordinary course covenant by closing the casino and hotel as mandated by the Governor's emergency directive and was entitled to retain the earnest money deposit. View "Lucky Lucy D LLC v. LGS Casino LLC" on Justia Law

The Supreme Court took the opportunity of this case to clarify that the district court's discretion to determine which costs were necessarily incurred by a prevailing party in awarding expenses the party incurred in its efforts to comply with a district court discovery order and held that the district court abused its discretion in part in awarding costs.In the underlying case, the district court entered judgment in favor of the prevailing party on its underlying breach of contract claims and then issued a post-judgment order denying the prevailing party's motion for attorney fees and relaxing costs. The Supreme Court consolidated the appeals and held that the district court (1) did not err in entering judgment in favor of the prevailing party on the breach of contract claims; (2) did not abuse its discretion in denying the prevailing party's motion for attorney fees; but (3) abused its discretion in denying the prevailing party's requests for costs incurred for trial technology services. View "North Las Vegas Infrastructure Investment & Construction, LLC v. City of North Las Vegas" on Justia Law

The Supreme Court denied Tahican LLC's petition seeking a writ of mandamus affirmed the judgment of the district court denying Tahican LLC's second motion seeking to expunge a lis pendens, holding that the district court did not err in denying Tahican's motion to expunge the lis pendens.Max Joly and Bydoo, LLC formed a partnership. Joly later transferred his shares in the partnership to Bydoo but Bydoo did not make the payments required under the parties' agreement. Joly sued Bydoo and Jean Francois Rigollet, alleging breach of contract. Bydoo later transferred real property to Tahican by quitclaim deed. When Joly recorded a notice of lis pendens against the property Rigollet sought to expunge the lis pendens. Joly amended his complaint to add Tahican as a defendant and allege fraudulent transfer. The district court denied the motion to expunge and granted summary judgment in favor of Joly on the majority of his claims. Tahican brought this petition for a writ of mandamus. The Supreme Court denied the writ, holding that there was no error in the denial of Tahican's motion to expunge the lis pendens because a fraudulent transfer claim seeking avoidance of the transfer of real property is an "action...affecting the title or possession of real property" within the meaning of Nev. Rev. Stat. 14.010(1). View "Tahican, LLC v. Eighth Judicial District Court" on Justia Law