Emerson v. the Eighth Judicial Dist. Court of State

• Decision Date: 06 October 2011
• Docket Number: No. 55238.,55238.
• Citation: 263 P.3d 224,127 Nev. Adv. Op. 61
• Parties: Phillip EMERSON, Petitioner,v.The EIGHTH JUDICIAL DISTRICT COURT OF the STATE of Nevada, in and for the COUNTY OF CLARK, and the Honorable Douglas Herndon, District Judge, Respondents,andGregory J. Lioce and Farmers Insurance Exchange, Real Parties in Interest.
• Court: Nevada Supreme Court

263 P.3d 224

127 Nev. Adv. Op. 61

Phillip EMERSON, Petitioner,

v.The EIGHTH JUDICIAL DISTRICT COURT OF the STATE of Nevada, in and for the COUNTY OF CLARK, and the Honorable Douglas Herndon, District Judge, Respondents,andGregory J. Lioce and Farmers Insurance Exchange, Real Parties in Interest.

No. 55238.

Supreme Court of Nevada.

Oct. 6, 2011.

Lemons, Grundy & Eisenberg and Robert Eisenberg, Reno; Emerson & Manke, PLLC, and Phillip R. Emerson, Henderson, for Petitioner.Coleman Law Associates and Edward S. Coleman, Las Vegas, for Real Party in Interest Gregory J. Lioce.

Before SAITTA, C.J., HARDESTY and PARRAGUIRRE, JJ.

OPINION

By the Court, HARDESTY, J.:

In this petition for extraordinary writ relief, we consider whether the district court can impose sanctions after it enters an order dismissing a case with prejudice pursuant to a stipulation of the parties under NRCP 41(a)(1)(ii). In resolving this issue, we initially address whether the district court has jurisdiction to impose sanctions after a stipulated dismissal. We conclude that the district court retains jurisdiction after a case is dismissed to consider sanctions for attorney misconduct that occurred prior to the dismissal. Next, we address whether the district court may impose as a sanction attorney fees and costs incurred in the original trial when a new trial is ordered. We conclude that the district court did not abuse its discretion by imposing as a sanction attorney fees and costs incurred in the original trial. We, therefore, deny writ relief.

FACTS

This matter arose out of a multivehicle traffic accident, which led to a dispute over who was at fault for the incident. See Lioce v. Cohen, 124 Nev. 1, 9, 174 P.3d 970, 975–76 (2008). The plaintiff, Gregory Lioce, sued three defendants, Dana Cohen; her spouse, Morry Cohen; and John Wilson. Id. at 9, 174 P.3d at 975. At trial, Wilson's attorney, petitioner Phillip Emerson, made a series of statements to the jury that this court later deemed improper.¹ Id. at 9–10, 20, 174 P.3d at 975–76, 982. The jury eventually found for the defendants. Id. at 10, 174 P.3d at 976. As a result of Emerson's comments, Lioce moved for a directed verdict or a new trial, but the district court denied both motions. Id. Lioce challenged the denial of both motions before this court, and we ultimately concluded that Emerson's comments were improper and amounted to impermissible jury nullification because they reflected his “personal opinion about the justness of [the plaintiff's] cause[ ].” Id. at 21–22, 174 P.3d at 983–84 (citing RPC 3.4(e)). We then vacated the order denying a new trial and remanded the Lioce matter to the district court with instructions.

On remand, the district court determined that a new trial as to defendants Dana and Morry Cohen was not warranted. However, the district court found that Lioce was entitled to a new trial against defendant Wilson because “the verdict in favor of Wilson would have been different but for the misconduct of [Emerson].”

After the district court granted Lioce's motion for a new trial as to Wilson, Lioce filed a motion for sanctions based on Emerson's misconduct. In the motion, he did not request a specified amount of attorney fees or costs; instead, he contended that the district court should award attorney fees and costs as sanctions “to make up for the immense amounts of additional expense Emerson has caused.”

At a hearing on the motion on July 22, 2009, the district court orally indicated its intent to grant sanctions in the amount of fees and costs “only as to the first trial.” On August 19, 2009, the parties filed a stipulation and order dismissing the matter with prejudice, and the district court entered its order regarding the same on August 24, 2009. The parties did not address the pending motion for sanctions in their stipulation. On September 11, 2009, the district court entered an order granting Lioce's motion and imposing $19,330 in sanctions on Emerson, personally. The district court selected this amount based on a declaration submitted by Lioce's counsel, which indicated various costs and attorney fees incurred during the original trial, including the time counsel spent in trial and the cost of an expert witness who testified.

Emerson then filed a motion for reconsideration, arguing that the district court improperly imposed sanctions against him. However, he did not raise the issue of whether the district court retained jurisdiction to consider the motion for sanctions after the case had been dismissed pursuant to the parties' stipulation. The district court denied the motion for reconsideration, after which Emerson petitioned this court for writ relief, requesting that we issue a writ directing the district court to vacate its order imposing sanctions.

DISCUSSION

“A writ of prohibition ‘serves to stop a district court from carrying on its judicial functions when it is acting outside its jurisdiction.’ ” Stephens Media v. Dist. Ct., 125 Nev. ––––, ––––, 221 P.3d 1240, 1246 (2009) (quoting Sonia F. v. Dist. Ct., 125 Nev. 38, ––––, 215 P.3d 705, 707 (2009)); see also NRS 34.320. “ ‘A writ of mandamus is available to compel the performance of an act that the law requires as a duty resulting from an office, trust, or station or to control an arbitrary or capricious exercise of discretion.’ ” Williams v. Dist. Ct., 127 Nev. ––––, ––––, 262 P.3d 360, –––– (2011) (quoting International Game Tech. v. Dist. Ct., 124 Nev. 193, 197, 179 P.3d 556, 558 (2007)); see also NRS 34.160. A writ will not issue if the “ ‘petitioner has a plain, speedy, and adequate remedy in the ordinary course of law,’ ” Williams, 127 Nev. at ––––, 262 P.3d at –––– (quoting Mineral County v. State, Dep't of Conserv., 117 Nev. 235, 243, 20 P.3d 800, 805 (2001)); see also NRS 34.170; NRS 34.330, and “[m]andamus will not lie to control discretionary action, unless discretion is manifestly abused or is exercised arbitrarily or capriciously,” Round Hill Gen. Imp. Dist. v. Newman, 97 Nev. 601, 603–04, 637 P.2d 534, 536 (1981) (internal citation omitted).

Because Emerson was not a party to the litigation below, he cannot appeal, and therefore he has no other remedy available at law. Additionally, Emerson raises an issue of first impression: whether the district court retains jurisdiction to consider sanctions following the voluntary dismissal of a case. Accordingly, we exercise our discretion to consider this writ petition.

The district court has jurisdiction to consider sanctions

In his writ petition, Emerson argues that the district court was without jurisdiction to impose sanctions once it dismissed the underlying matter pursuant to the parties' stipulation. Whether the district court had ongoing jurisdiction to impose sanctions is a question of law this court reviews de novo. See American Sterling Bank v. Johnny Mgmt. LV, 126 Nev. ––––, ––––, 245 P.3d 535, 538 (2010). Although Emerson failed to raise this argument in the district court, this failure is not fatal to his writ petition because the parties can raise subject matter jurisdiction at any time. Landreth v. Malik, 127 Nev. ––––, ––––, 251 P.3d 163, 166 (2011).

We have previously held that jurisdiction over matters related to the merits of a case terminates upon dismissal. Jeep Corp. v. District Court, 98 Nev. 440, 443–44, 652 P.2d 1183, 1186 (1982); SFPP, L.P. v. Dist. Ct., 123 Nev. 608, 612, 173 P.3d 715, 718 (2007). In Jeep Corp., the district court sua sponte entered a judgment on the merits after the parties stipulated to dismiss the case without prejudice ² and filed a notice to that effect. 98 Nev. at 442, 652 P.2d at 1185. We held that the district court lacked jurisdiction to consider any action on the merits of the case because the dismissal “terminated [the action] and the court is without further jurisdiction in the matter.” Id. at 444, 652 P.2d at 1186. Similarly, in SFPP, L.P., the parties stipulated to dismiss the dispute between them, and we concluded that the “district court lost jurisdiction over the judgment once the order for dismissal with prejudice was entered and lacked jurisdiction to conduct any further proceedings with respect to the matters resolved in the judgment unless it was first properly set aside or vacated.” 123 Nev. at 612, 173 P.3d at 718. Jeep Corp. and SFPP, L.P. thus leave open the question of whether the district court retains jurisdiction to consider collateral matters such as sanctions for attorney misconduct when, as here, the parties stipulated to dismiss the case with prejudice.

The United States Supreme Court has held that a lower court may impose sanctions under Federal Rule of Civil Procedure 11 after a plaintiff files a voluntary notice of dismissal. Cooter & Gell v. Hartmarx Corp., 496 U.S. 384, 395, 110 S.Ct. 2447, 110 L.Ed.2d 359 (1990). The Court noted several other collateral issues over which federal courts exercise ongoing jurisdiction, including “costs after an action is dismissed for want of jurisdiction,” attorney fees, and criminal contempt charges. Id. at 395–96, 110 S.Ct. 2447. Similarly, this court has held that the district court retains jurisdiction to award attorney fees in the underlying matter after an appeal is filed. Kantor v. Kantor, 116 Nev. 886, 894–95, 8 P.3d 825, 830 (2000) (holding that, although a timely notice of appeal divests the district court of jurisdiction and vests jurisdiction in this court, the district court had jurisdiction to award attorney fees while an appeal of the underlying divorce decree was pending because the “collateral matter did not affect the merits of [the appellant's] appeal”). Other jurisdictions have similarly held that the district court retains jurisdiction to consider sanctions following a voluntary dismissal, or after an appeal has been filed. See Toumajian v. Frailey, 135 F.3d 648, 657 (9th Cir.1998) (holding that “despite a lack of subject matter jurisdiction, a district court may properly award sanctions under ...