Kantor v. Kantor

• Decision Date: 15 September 2000
• Docket Number: No. 33659, No. 34185.
• Parties: Janet KANTOR, Appellant, v. Gary KANTOR, Respondent. (Two Cases).
• Court: Nevada Supreme Court

8 P.3d 825

116 Nev. 886

Janet KANTOR, Appellant, v. Gary KANTOR, Respondent. (Two Cases).

Nos. 33659, 34185.

Supreme Court of Nevada.

September 15, 2000.

Dowling, Myers & Helm, LLP, Las Vegas, for Appellant.

Lemons Grundy & Eisenberg, Reno; Ecker & Standish, Ltd., Las Vegas, for Respondent.

Before YOUNG, AGOSTI and LEAVITT, JJ.

OPINION

PER CURIAM:

This is a multimillion dollar divorce case involving a premarital agreement. Appellant Janet Kantor challenges (1) the district court's denial of her motion to amend her answer; (2) the district court's failure to determine the validity and substantive fairness of the premarital agreement before applying its provisions; and (3) the district court's award of attorney's fees. We affirm.

FACTS AND PROCEDURAL HISTORY

Dr. Gary Kantor is a medical doctor specializing in nephrology, which is the treatment of kidney disorders and diseases. Gary's practice, incorporated as a professional corporation, is named Kantor Nephrology Consultants, Ltd. ("KNC"). Gary also has formed separate business entities which provide kidney dialysis services. These businesses are collectively known as the Renal Dialysis Center ("RDC"). Because RDC is not a professional corporation, RDC cannot collect revenue for a physician's services. Therefore, when Gary renders personal medical treatment at an RDC facility, his services are billed through KNC.

Before Gary married Janet on November 22, 1990, the parties entered into a premarital agreement. Gary and Janet were represented by separate counsel, although Gary paid Janet's attorney for his services. Under the premarital agreement, Gary and Janet agreed that the income of the other party would be that party's separate property, except as otherwise provided in the agreement. Paragraph 2 .2 contained Janet's acknowledgment, which stated:

WIFE acknowledges that she understands that, except for this AGREEMENT, the earnings and income resulting from the personal services, skill, effort and work of HUSBAND after the parties' marriage would be community property in which she may have an interest, but that by this AGREEMENT such earnings and income are made HUSBAND's separate property, except as specifically set forth herein to the contrary. WIFE further acknowledges that the income from HUSBAND's separate property is his separate property.

(Emphasis added.)

The agreement designated some of Gary's earnings as community property. Paragraph 6.1 of the agreement stated, in part, that:

[I]t is agreed that any and all salary or fees received by HUSBAND in exchange for his provision of personal medical care and services (as a practicing physician) shall be community property. The parties acknowledge that, presently, all such salary or fees come to HUSBAND in the form of a salary from Kantor Nephrology Consultants, Limited ....

Janet contends that she was never informed as to the nature and amount of Gary's earnings, specifically his income from RDC. She further contends that, based on Paragraph 6.1 and Gary's representations, she understood that all of Gary's salary and income were derived from KNC, and were therefore community property.

Gary, on the other hand, claims that, prior to executing the premarital agreement, he informed Janet that his expected income from KNC was in excess of $500,000.00 per year and that his income from RDC would be substantially higher than $500,000.00 per year. Exhibits to the premarital agreement indicate that Janet had assets worth over $7,000,000.00 and that Gary had assets worth nearly $22,000,000.00. Gary's stock owner-ship in KNC and RDC were listed as separate assets in these exhibits.

Gary filed for divorce on October 22, 1997. The second paragraph of the complaint alleged that the premarital agreement was valid and enforceable. Janet's original answer denied the allegations contained in the second paragraph of the complaint on the ground that Janet was "without sufficient information with which to form a belief as to the truth of said allegations."

Because Gary's attorneys in the divorce proceedings were the same attorneys who represented Gary in the preparation and drafting of the premarital agreement, they were concerned that they would be disqualified as trial counsel if called as witnesses concerning the validity of the premarital agreement. One of Gary's attorneys then discussed the issue with Janet's attorney. On February 13, 1998, Janet filed an amended answer, which admitted the validity of the premarital agreement. This resolved any concerns regarding the disqualification of Gary's attorneys.

A one-day bench trial was scheduled for August 14, 1998. Prior to that, on August 5, 1998, one of Gary's attorneys deposed Janet's accounting expert. During the deposition, the expert presented two reports regarding his calculations of community income. The first report concerned only income from KNC during the marriage. A second report included Gary's income from RDC earned during the marriage, which the expert contended should also be included as community property. Apparently this was the first time it was suggested that Gary's income from RDC should be considered community property. As a result, the original trial date was vacated and trial was re-set for November 20, 1998.

On September 21, 1998, Janet's attorney requested depositions from Gary's attorneys. On September 30, 1998, Gary filed a motion for a protective order, seeking to prevent his attorneys from being deposed. Later that same day, Janet filed a motion to amend her amended answer in order to challenge the validity of the premarital agreement. Gary filed a written opposition to the motion. The district court thereafter denied the motion.

The trial was held on November 20, 1998. Janet's accounting expert testified that the community was due more than $5,000,000.00 as a result of Gary's income from RDC during the marriage. The district court disagreed and ruled that Gary's income from RDC was not derived from the rendering of personal services as a practicing physician, and therefore was not community property under Paragraph 6.1 of the agreement.

During trial, Gary requested attorney's fees arising out of his opposition to Janet's motion to amend her amended answer. The district court stated that Gary would have to file a motion for attorney's fees. Paragraph 10.2 of the premarital agreement states that "[t]he parties confirm and agree that, in the event of a dissolution of the parties' marriage, neither party shall make a claim for attorneys' fees against the other, whether by way of preliminary motion or at the time of trial." However, Paragraph 12.5 contains a specific indemnity provision which states that:

Each party hereunder shall be indemnified for and against all loss, damages, costs and expenses (including, but not limited to, attorneys' fees and costs incurred at the trial and appellate levels) as a result of or arising from any demand, claim or suit by or on behalf of either party hereto contesting or attempting to modify, change, set aside, nullify, or cancel this AGREEMENT or any part or provision of this AGREEMENT for any reason whatsoever. The indemnity provisions of this AGREEMENT shall specifically apply to costs, expenses and attorneys' fees, as defined herein, incurred by a party successfully seeking enforcement of this AGREEMENT or any provision hereof.

The findings of fact, conclusions of law and decree of divorce was filed on December 23, 1998. The district court's order stated that it would defer ruling on the issue of Gary's request for attorney's fees in order to give the parties an opportunity to settle this issue. Janet filed her notice of appeal on January 21, 1999. On January 27, 1999, Gary filed a motion for attorney's fees pursuant to the indemnity provision in the premarital agreement. Janet objected to this motion, in part, on the ground that the district court lacked jurisdiction to award attorney's fees after she filed her notice of appeal. The district court ruled that it retained jurisdiction and awarded Gary attorney's fees in the amount of $19,580.00. Janet then appealed the district court's order granting Gary attorney's fees. By order of this court, we consolidated Janet's appeals.

DISCUSSION

Whether the district court abused its discretion by denying Janet's motion to amend her amended answer

After a responsive pleading is filed, a party may amend his or her pleading "only by leave of court or by written consent of the adverse party; and leave shall be freely given when justice so requires." NRCP 15(a). Although the rule states that leave to amend shall be given when justice so requires, "[t]his does not . . . mean that a trial judge may not, in a proper case, deny a motion to amend. If that were the intent, leave of court would not be required." Stephens v. Southern Nevada Music Co., 89 Nev. 104, 105, 507 P.2d 138, 139 (1973). Sufficient reasons to deny a motion to amend a pleading include undue delay, bad faith or dilatory motives on the part of the movant. See id. at 105-06, 507 P.2d at 139. Furthermore, "[a] motion for leave to amend pursuant to NRCP 15(a) is addressed to the sound discretion of the trial court, and its action in denying such a motion will not be held to be error in the absence of a showing of abuse of discretion." Connell v. Carl's Air Conditioning, 97 Nev. 436, 439, 634 P.2d 673, 675 (1981).

In this case, the district court denied Janet's motion for leave to amend her amended answer because the parties relied on the validity of the premarital agreement, the motion was filed on the "eve" of trial and Janet was dilatory in requesting leave to amend. We conclude that the district court did not abuse its discretion by denying Janet's motion for leave to amend her amended answer.

The district court found that both parties relied on the validity of the agreement. Janet received $100,000.00 under the terms of the agreement. Additionally, Gary, in reliance on the validity...