Gramanz v. Gramanz

• Decision Date: 22 July 1991
• Citation: 930 P.2d 753,113 Nev. 1
• Parties: Claire GRAMANZ, Individually, and in Her Capacity as Trustee of the Claire Gramanz Living Trust U.T.D., 0
• Court: Nevada Supreme Court

Page 753

930 P.2d 753

113 Nev. 1

Claire GRAMANZ, Individually, and in Her Capacity as Trustee of the Claire Gramanz Living Trust U.T.D 07/22/91, Appellant, v. Brent GRAMANZ, Anisac Corporation, a Nevada Corporation, and G & S Enterprises Inc., a Nevada Corporation, Respondents.

No. 25788.

Supreme Court of Nevada.

Jan. 3, 1997.

Laura Wightman Fitzsimmons, Las Vegas, for Appellant.

Lemons, Grundy & Eisenberg, Reno, for Respondents.

OPINION

PER CURIAM:

FACTS

Appellant Claire Gramanz ("Claire") and respondent Brent Gramanz ("Brent") were married in 1975, had three children together, and divorced in California in 1989.

During the marriage, Brent operated three retail souvenir shops in a building located in Las Vegas at 3235 Las Vegas Boulevard adjacent to the Desert Inn. These businesses had long-term commercial leases. In August 1987, a bank threatened foreclosure on the underlying property on which Brent was operating his shops. On August 24, 1987, Brent and the property owner signed an agreement by which Brent helped the owner avoid foreclosure in exchange for a 25% ownership interest in the property. At the same time, Brent exercised options to extend the terms of all three leases until 2007. Brent and the owner signed these options. On September 24, 1987, the owner conveyed a deed for 25% interest in the real property to Brent and Claire as joint tenants. Brent and his attorney allegedly had an agreement that if the property was later sold at a profit, the attorney would receive a bonus fee.

In 1989, Brent and Claire's divorce was entered in California. However, the parties continued negotiating for resolution of property and child custody issues. In November 1990, the parties entered into a stipulation before the California court concerning the disposition of their property. The stipulation stated that it was a distribution of all property owned by the parties. Each party warranted that it did not own any other community property of any kind other than that listed in the stipulation. If such property were later discovered, it was to be divided equally. The only remaining questions at the time of the stipulation dealt with custody and visitation regarding the minor children, and with the value of certain properties and businesses which had been distributed to the parties. The stipulation was merged into the earlier judgment of dissolution.

The value of the 25% ownership in the Las Vegas property was not determined in the November 1990 stipulation, because the parties felt that the property was valuable and would be "far more [valuable] down the line" such that they could make a large profit on any sale. Accordingly, the property was placed in a limited partnership, with Brent as the controlling partner and Claire as a limited partner.

Pursuant to the November 1990 stipulation, Claire transferred all her rights, interest and shares in the Gramanz corporations, including Anisac Corporation ("Anisac"), and their assets, to Brent as his sole and separate property, with the value of Anisac to be divided equally, in exchange for Brent holding her harmless against any liabilities or obligations against the corporations. The stipulation did not mention the disposition of G & S Enterprises.

The final valuation of Anisac was reserved for future determination. The parties agreed that Anisac would be appraised by two CPAs, who would attempt to agree upon a value that would then be divided equally between the parties. On October 2, 1991, the parties filed a "Stipulation to Final Valuation of Anisac Corporation and Order" with the California Superior Court. That stipulation reflected the agreement of the parties, upon the valuation of their accountants, that Anisac stock would be valued at $300,000.

In the divorce proceedings, Claire received property and cash with a total net value of nearly $1,600,000 plus her 12.5% interest in the Las Vegas Boulevard property (for which she later received $400,000). Claire ultimately received approximately $2,000,000 in property and cash.

In 1993, ITT-Sheraton expressed interest in purchasing the Las Vegas Boulevard real property on which the stores were located. On July 13, 1993, Claire's attorney sent a letter to Brent's attorney asserting that the commercial leases on the Las Vegas property and the assets of G & S had never been distributed in the divorce. The letter stated that Claire "is making a claim to the lease rights and any proposed buy-out offers." Brent became concerned that Claire's assertion of a right to the proceeds of the sale to ITT-Sheraton might impair the sale. On August 10, 1993, Brent, Anisac and G & S filed a complaint for declaratory relief against Claire in the Eighth Judicial District Court, Clark County (the "Clark County case").

In Brent's complaint, he alleged that he and Claire were partners in the Las Vegas property, in which they each owned a 12.5% share, and that Brent was the controlling partner. He alleged that the partnership agreement gave him the unilateral right to enter into an agreement with a third party for the sale of the partnership interest in the real property. Brent further alleged that he had been awarded all interest and assets in both Anisac and G & S by the divorce and that, by virtue of that fact, he had also received all interest to the leasehold interests. Brent claimed that the three leases in the property were all assets of Anisac that had been set aside to him as his sole and separate property in the divorce stipulation. He alleged that Claire's assertion of an interest in the leases or input regarding the terms of a sale of the property would jeopardize the sale, and that absent declaratory relief, he would be inhibited from concluding the sale.

In early November 1993, the parties entered into two separate stipulations regarding the Nevada property and the Nevada corporations. First, on November 1, 1993, the parties filed a stipulation in the California divorce case. This stipulation recognized that there was a dispute over the rights and obligations of the parties regarding the Nevada corporations and the Nevada property. The stipulation then stated that the parties agreed that the California court "should defer the exercise of Jurisdiction over all the Nevada property and Corporations," and that "issues and property rights should be decided by the Clark County, Nevada Court."

A few days later, on November 9, 1993, the parties filed a stipulation in the Clark County case. The stipulation indicated that the parties would allow the closing and consummation of the ITT-Sheraton transaction involving the property at 3235 Las Vegas Boulevard, and certain funds "shall be impounded under the jurisdiction of the Eighth Judicial District Court pending the outcome of this adversary proceeding." The stipulation ended with the following provision:

9. The Parties have stipulated and agreed that the California Court should defer the exercise of Jurisdiction over all the Nevada property and Corporations, including the issues presently in dispute as raised by Petitioner, and that those issues and property rights should be decided by the Clark County, Nevada Court, exercising Jurisdiction, and pursuant to their Stipulation, all further proceedings in the California action have now been stayed.

As agreed in the November 9, 1993 stipulation, the transactions with ITT-Sheraton went forward. In June 1990, the entire fee simple ownership of the property was appraised at $5,715,000. The Gramanz 25% interest was eventually sold to ITT-Sheraton for $1,550,000. ITT-Sheraton paid $4,500,000 for the other 75% ownership interest. Thus, the 100% fee simple interest was sold to ITT-Sheraton for approximately $6,050,000, which was $300,000 more than the appraised value of the property in 1990. After paying off the mortgage on the property, Claire received approximately $400,000 for her 12.5% interest.

In addition to what he received for his fee interest, Brent received $6,450,000 by selling his Anisac stock to ITT-Sheraton. ITT-Sheraton bought the Anisac stock for the purpose of extinguishing the three leases. Because Claire claimed an interest in those proceeds, the funds were impounded until the dispute could be resolved.

The parties agreed that the two issues in the declaratory relief action--a bonus fee agreement made with Brent's attorney, and the leases on the property on Las Vegas Boulevard--would proceed to trial in Clark County. At trial Grant Anderson, one of the two CPAs hired to appraise Anisac when Brent and Claire divorced, testified that he utilized an "excess earnings method" to arrive at a value of $221,500 for Anisac. Anderson admitted that he did not look at the leasehold interests individually, but "looked at the value of the business as a whole which would encompass all assets of the business." He stated that the other CPA used a different method to appraise Anisac, but also valued it as a whole rather than by its individual assets. On cross-examination, Anderson testified that he did not recall receiving any leases with the documents with which he performed the valuations. He also stated that he did business valuations, but was not qualified to appraise real estate. The leases were reflected in his appraisal only to the extent that they may have been reflected in the business's income statements as "bargain leases."

Gary Kent, a real estate appraiser, testified on Claire's behalf. Kent had prepared an appraisal report of the real property in June 1990. He testified that he did not do an independent valuation of the leases, partly because they appeared not to be "arm's length" transactions.

The district court held that Claire had no right, title or interest to the $6,450,000 in proceeds from the sale of the leases, and that Claire was liable for payment of a bonus fee to Brent's attorney.

DISCUSSION

Jurisdiction.

Claire contends that the district court abused its discretion in exercising jurisdiction over...