Cook v. Cook

• Citation: 112 Nev. 179,912 P.2d 264
• Decision Date: 29 February 1996
• Docket Number: No. 26135,26135
• Parties: Jane COOK, now Jane Field, Appellant, v. Frank C. COOK, Respondent.
• Court: Supreme Court of Nevada

Page 264

912 P.2d 264

112 Nev. 179

Jane COOK, now Jane Field, Appellant, v. Frank C. COOK, Respondent.

No. 26135.

Supreme Court of Nevada.

Feb. 29, 1996.

Daniel Marks, Las Vegas, for Appellant.

William R. Phillips, Las Vegas; Williamson & Rush, Las Vegas, for Respondent.

OPINION

PER CURIAM:

Jane Field Cook, now Jane Field, ("Jane") and Frank C. Cook ("Frank") were married in 1978, and later that same year Frank started his own law practice in Las Vegas. The parties decided to divorce in December 1992. Frank drafted a property settlement agreement providing, inter alia, that he would receive the law practice as his separate property and that Jane waived any interest in his income for the years 1990, 1991, and 1992. Although Jane had Floyd Hale, Esq., review the property settlement agreement on her behalf, she signed the agreement in proper person. On the other hand, Frank and his legal counsel, William B. Terry, both signed the agreement. On December 31, 1992, Frank filed a complaint for divorce with the district court through his counsel, Jane filed her answer in proper person, and the district court heard the matter and issued a decree of divorce that same day.

On June 25, 1993, Jane filed a timely motion to vacate the divorce decree and for a new trial pursuant to NRCP 60(b), alleging that the property settlement agreement was fundamentally unfair and that Frank had coerced her into signing the agreement. Jane submitted an affidavit stating that Frank had threatened her not to retain an attorney for the divorce action because he would lose his law practice, face imprisonment and resort to leaving the country due to tax evasion. Jane further submitted an affidavit from Kenneth Fortney, a certified public accountant, who evaluated the parties' community property and determined that Frank had received approximately $600,000 and Jane $100,000 of the $700,000 community property estate. ¹ Frank submitted an affidavit denying Jane's assertions of coercion and argued that Jane received legal counsel from Floyd Hale before signing the property settlement agreement.

The district court denied Jane's motion, specifically finding that Jane had independent competent counsel to represent her and that Frank did not coerce Jane into signing the agreement. Jane argues that the district court abused its discretion in denying her motion. We agree.

The district court has wide discretion in deciding whether to grant or deny a motion to set aside a judgment under NRCP 60(b). Its determination will not be disturbed on appeal absent an abuse of discretion. Stoecklein v. Johnson Electric, Inc., 109 Nev. 268, 271, 849 P.2d 305, 307 (1993). However, this discretion is a legal discretion and cannot be sustained where there is no competent evidence to justify the court's action. Id.

We conclude that the district court abused its discretion by denying Jane's motion to vacate the divorce decree and for a new trial. There is no competent evidence to support the district court's finding that Jane was represented by independent counsel. Most significantly, Jane signed both legal documents central to the divorce action in proper person: her answer to Frank's complaint for divorce and the property settlement agreement. Under NRCP 11:

Every pleading, motion, or other paper of a party represented by an attorney shall be signed by at least one attorney of record in his individual name, whose address shall be stated. A party who is not represented by an attorney shall sign his pleading, motion, or other paper, and state his address and shall acknowledge his pleading.

Here, no attorney signed Jane's answer to the complaint for divorce or the property settlement agreement on her behalf. She signed her papers without such benefit. Further, the record contains no notice of representation indicating that Floyd Hale represented Jane in the divorce action. The evidence dictates the finding that Jane had no legal representation.

Given the conclusion that Jane was not represented by competent independent counsel in the divorce action, Williams v. Waldman, 108 Nev. 466, 836 P.2d 614 (1992), is on point. In that case, Sharron Williams, a non-attorney, and Herbert Waldman, an attorney, decided to end their thirteen-year marriage. Id. at 468, 836 P.2d at 616. When the parties made their decision, Waldman suggested to Williams that they save the expense of hiring an attorney and offered to draft the divorce papers himself. Id. Waldman prepared the property settlement agreement and other papers, represented to Williams that the agreement was fair to her and their three children, and did not propose to her that the agreement be reviewed by independent counsel. Id. Williams signed the papers without consulting an attorney, and the court entered a divorce decree. Id. Seven years later, Williams sought an increase in child support. Id. She retained an attorney who reviewed the property settlement for legal background and asked Williams about the division of Waldman's law practice. Id. "[T]his was the first time that she became aware that Waldman's law practice was community property, divisible upon divorce, with a monetary value which inured to her individual benefit." Id. Williams then filed an action alleging that Waldman's law practice was not provided for in their property settlement agreement. Id.

The district court concluded that Williams failed to prove by a preponderance of the evidence that the law practice was not divided upon divorce. Id. Williams appealed, and this court reversed. Id. at 474, 836 P.2d at 619. This court determined that the parties' agreement was the product of an attorney-client relationship. Id. at 471, 836 P.2d at 618. This court noted that "an attorney-client relationship is not precluded by the mere fact of a legally close or blood relationship" and that "[f]ormality is not a necessary element in the creation of such a relationship." Id. This court stated that "when advice is given by an attorney, the attorney-client relationship may be established through proof of detrimental reliance." Id. at 471 n. 3, 836 P.2d at 618 n. 3 (citing 7A C.J.S. Attorney & Client § 169 n. 18(2) (1980 & Supp.1991)).

In Williams, this court further stated:

An attorney-client relationship necessarily gives rise to a fiduciary relationship between an attorney and client, and all transactions growing out of such a relationship or [sic] subject to the closest scrutiny by the courts. We have also held that when an attorney enters into a business relationship with a client which is, by its terms, potentially advantageous to the lawyer, this court will closely scrutinize such a transaction on appeal. A fiduciary relationship also arises from the existence of the marriage itself, thus precipitating a duty to disclose pertinent assets and factors relating to those assets.

Id. at 471-72, 836 P.2d at 618 (citations omitted). This court stated that the record showed that Williams was not fully informed of all material facts relating to the value and character of Waldman's stock ownership and that Waldman failed to demonstrate that Williams completely understood her property rights when s...