Justia Contracts Opinion Summaries

Articles Posted in Supreme Court of Nevada

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In this breach of contract action the Supreme Court reversed the portion of the district court's judgment awarding attorney fees as special damages, holding that attorney fees incurred by a plaintiff in bringing a two-party breach-of-contract claim against a defendant do not constitute special damages under the limited exceptions recognized by the Court. While Nevada adheres to the American Rule of attorney fees, the Supreme Court has recognized a narrow and limited exception for attorney fees as special damages. In the instant case, Plaintiffs brought an action against Defendants alleging breach of contract, breach of the implied covenant of good faith and fair dealing, and an accounting. The district court found in favor of Plaintiffs and awarded Plaintiffs attorney fees as special damages and because they were the prevailing parties pursuant to the contract. The Supreme Court affirmed in part and reversed in part, holding (1) attorney fees was properly awarded based on the parties' contractual prevailing party provision; but (2) the district court erred in awarding Plaintiffs attorney fees as special damages for the two-party breach-of-contract action. The Court remanded the matter because the prevailing parties may be entitled to additional attorney fees in light of this opinion. View "Pardee Homes of Nevada v. Wolfram" on Justia Law

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The Supreme Court affirmed the order of the district court granting summary judgment in favor of Respondents, a real estate appraisal company and a professional real estate appraiser, as to Appellants' allegations that Respondents' negligence prevented them from refinancing their home loan, holding that Appellants' claims lacked evidentiary support and were based on little more than conclusory allegations and accusations. After purchasing a home, Appellants brought this action against Respondents asserting claims for professional negligence, negligent misrepresentation, breach of the statutory duty to disclose a material fact, and breach of contract as third-party beneficiaries. Specifically, Appellants alleged that Respondents negligently relied on inaccurate information in calculating the home's size and market value, which resulted in a misleading appraisal report and inflated purchase price. The district court granted summary judgment for Respondents. The Supreme Court affirmed and took the opportunity of this case to emphasize the important role of summary judgment in promoting sound judicial economy. View "Boesiger v. Desert Appraisals, LLC" on Justia Law

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The Supreme Court affirmed the judgment of the trial court in this contract action, holding that any failure by landlords to strictly comply with any contractual notice provisions when declaring a lease in default is excused when the allegedly defaulting party receives actual notice of the default despite noncompliance. Treasure Island, LLC and its prime tenant, Rose, LLC, entered into a lease for space inside of Treasure Island's hotel/casino that was subleased to Señor Frog's and used to operate a restaurant. Treasure Island declared the lease in default when Rose failed to make timely rent payments. Thereafter, Treasure Island sued Rose alleging breach of the lease agreement and seeking declaratory relief. Rose counterclaimed, alleging breach of contract and seeking declaratory relief, arguing (1) the district court erred in declaring the lease terminated because Treasure Island failed to give proper notice of the default, and (2) the judgment was void because Señor Frog's was a necessary party and was not joined in the action in violation of Nev. R. Civ. P. 19. The trial court entered judgment for Treasure Island. The Supreme Court affirmed, holding (1) Rose suffered no prejudice because it received actual notice of the default; and (2) Señor Frog's was not a necessary party to the litigation. View "Rose, LLC v. Treasure Island, LLC" on Justia Law

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The Supreme Court held that the Labor Commissioner properly determined that the “repair” portion of a maintenance contract is a public work project under Nev. Rev. Stat. 338.010(15), even if the contract is predominantly for maintenance, and is thus not exempt from prevailing wage requirements. This case involved a maintenance contract for an airport shuttle system. The Labor Commissioner determined in this case that because a portion of the work under the contract in this case was repair work, that work was a “public work” project under the statute and thus subject to prevailing wage requirements. The Supreme Court affirmed, holding that the Labor Commissioner properly determined that twenty percent of the work involved repair rather than maintenance and was thus subject to the prevailing wage, and no exceptions applied that would allow Appellant to forego paying prevailing wages on that portion of the contract. View "Bombardier Transportation (Holdings) USA, Inc. v. Nevada Labor Commissioner" on Justia Law

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The Supreme Court answered a certified question submitted by the United States District Court for the District of Nevada by holding that, under Nevada law, an insurer’s liability where it breaches its contractual duty to defend is not capped at the policy limits plus any costs incurred by the insured in mounting a defense. Instead, an insurer may be liable for any consequential damages caused by its breach. Further, good faith determinations are irrelevant for determining damages upon a breach of the duty to defend. Respondents filed suit against Appellant-insurer for breach of contract and other causes of action. The federal court concluded that Appellant did not act in bad faith but did breach its duty to defend. The federal court subsequently entered an order staying the proceedings until resolution of the certified question by the Supreme Court. The Supreme Court answered as set forth above, holding that an insured may recover any damages consequential to the insurer’s breach of its duty to defend, and therefore, an insurer’s liability for breach of that duty is not capped at the policy limits, even if the insurer did not act in bad faith. View "Century Surety Co. v. Andrew" on Justia Law

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The Supreme Court affirmed the district court’s order awarding attorney fees and costs to Defendant on its counterclaim after the court determined Defendant to be the “prevailing party” following bifurcated trials, in which the parties settled as to damages on Plaintiff’s claims in an amount that exceeded Defendant’s damages judgment on its counterclaim. Specifically, the Court held that the district court did not abuse its discretion by failing to aggregate the settlement recovery and damages award in this case because (1) there is no Nevada statute or court rule that requires the trial court to offset a damages judgment on one party’s counterclaim by the amount recovered by another party in settling its claim to determine which side is the prevailing party; and (2) the most reasonable interpretation of Nev. Rev. Stat. 18.010(2)(a) and 18.020(3) precludes the use of settlement recovery for this purpose. View "Northern Nevada Homes, LLC v. GL Construction, Inc." on Justia Law

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In this dispute over a noncompete agreement (NCA) the Supreme Court reaffirmed its previous holdings that an NCA must be limited to the geographical areas in which an employer has particular business interests and emphasized that this precedent remains applicable in instances where the NCA imposes a nationwide restriction on the former employee. The Court further clarified that an employer seeking a preliminary injunction enforcing an NCA bears the burden of making a prima facie showing of the NCA’s reasonableness. In this dispute over an NCA, the Supreme Court reversed the district court’s grant of the motion for a preliminary injunction filed by Respondent, an employer, seeking to enforce the terms of a noncompete agreement (NCA) against Appellant, a former employee, holding that Respondent failed to make a prima facie showing that the NCA was reasonable by showing its restrictions did not extend beyond date geographical areas in which Respondent conducted business. View "Shores v. Global Experience Specialists, Inc." on Justia Law

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One party’s material breach of a contract releases the non-breaching party’s contractual obligation to a third-party beneficiary. The promisor in this case failed to fulfill its contractual obligations to Appellants under a settlement agreement. Appellants sued the promisor and six of its officers, including Respondents. Respondents, the third-party beneficiaries, claimed that the settlement agreement released them from liability for the promisor’s actions and precluded Appellants’ suit. The district court granted summary judgment to Respondents. The Supreme Court reversed, holding that the promisor’s material breach of the settlement agreement released Appellants from their obligation under that agreement not to sue the promisor’s officers. Therefore, the Court reversed the district court’s grant of summary judgment and remanded the matter to the district court for further proceedings. View "Cain v. Price" on Justia Law

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In this commercial dispute over an exclusive use clause in a lease for space in a shopping center, the Nevada Supreme Court held that the doctrine of claim preclusion did not prevent the tenant from suing its landlord for contract damages after having won an earlier suit against the landlord for declaratory judgment, where both suits concern the same underlying facts. The court explained that the preclusion doctrine makes an exception for declaratory judgment actions, which are designed to give parties an efficient way to obtain a judicial declaration of their legal rights before positions become entrenched and irreversible damage to relationships occurs. Furthermore, in a case involving a continuing or recurrent wrong, a party may sue separately for after-accruing damages. Accordingly, the court affirmed the judgment awarding contract damages to the tenant. View "Boca Park Marketplace Syndications Group, LLC v. Higco, Inc." on Justia Law

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The Supreme Court granted the Nevada Department of Transportation’s (NDOT) petition for a writ of mandamus, holding that the district court erred in denying NDOT’s motions for summary judgment on Landowner’s contract claims concerning a settlement agreement in a condemnation action. The court held that the district court erred in declining to grant summary judgment by interpreting the parties’ agreement to include a duty imposed outside the express terms of the agreement and allowing a claim for unilateral mistake to proceed even though Landowner’s claim was barred by the applicable statute of limitations. View "State Department of Transportation v. Eighth Judicial District Court" on Justia Law