Mullis v. Nevada Nat. Bank
| Citation | 98 Nev. 510,654 P.2d 533 |
| Decision Date | 09 December 1982 |
| Docket Number | No. 13642,13642 |
| Parties | Tom N. MULLIS, M.D., Individually and on behalf of himself and all other stockholders of 221 North Virginia Street, Inc., a Nevada corporation, dba Silver Spur Casino, Appellants, v. NEVADA NATIONAL BANK, a National Banking Association, Respondent. |
| Court | Supreme Court of Nevada |
Eric Zubel, Jeffrey N. Samuels, Darrell L. Clark, Las Vegas, for appellants.
Guild, Hagen & Clark, C. David Russell, Reno, for respondent.
This appeal involves the district court's interpretation of various loan documents. Summary judgment was entered in favor of the author of the subject documents. Because substantial factual disputes are both material and apparent, we must reverse.
In March of 1977, appellant Mullis and respondent Nevada National Bank (Bank) entered into a loan agreement under which the Bank loaned Mullis $2.1 million. This loan was evidenced by a promissory note secured by Mullis's real and personal assets, including approximately 867 shares of stock in the Silver Spur Casino (Silver Spur).
In 1979, the Silver Spur declared a dividend from which Mullis received approximately $85,000. Mullis immediately loaned the $85,000 back to the Silver Spur. Shortly thereafter, Mullis defaulted in his payments on the promissory note and the loan became delinquent. Rather than declare a default and demand payment in full, the Bank elected to assist Mullis in his efforts to sell some of his assets. These efforts, however proved to be futile.
Thereafter, the Bank advised the Silver Spur that it claimed the right to any dividends and/or earnings on Mullis's stock by virtue of the Pledge and Security Agreement entered into between the parties as part of the March, 1977 loan transaction. When the Silver Spur decided to distribute the corporation's retained earnings to its shareholders, it sent a letter to both Mullis and respondent informing them that the former's share of the distribution was $28,890, and that the corporation would hold that amount pending distribution instructions from both parties.
Mullis then filed a complaint against the Silver Spur and its corporate officers and directors alleging, among other things, that the Silver Spur was indebted to him in the sum of $85,000 by virtue of the loan of March of 1979, and that he was entitled to the $28,890 as his share of the distribution of the retained earnings. The Silver Spur did not contest these allegations and voluntarily deposited the total amount with the clerk of the court.
The Silver Spur responded to the complaint by filing a third party complaint for interpleader against the Bank on the ground that the Bank had previously made claim to all funds which were now deposited with the court. The Bank, in turn, counterclaimed for the $85,000 claiming that it was entitled to this amount as a dividend declared by the Silver Spur. Eventually, all the parties to the action entered into a stipulation whereby appellants' complaint against the Silver Spur would be dismissed as would the Bank's counterclaim against the Silver Spur. However, the court retained jurisdiction to determine the rights of the parties to the deposited funds. In the interpleader action, the district court determined that there existed no genuine issue of fact and, as a matter of law, the Bank was entitled to the sum of $129,795.75. 1 We reverse.
The constraints applicable to a summary proceeding are well-defined. Trial judges are admonished to exercise great caution in granting summary judgment. Litigants are not to be deprived of a trial on the merits if there is the slightest doubt as to the operative facts. "Summary judgment may not be used as a short cut to the resolving of disputes upon facts material to the determination of the legal rights of the parties." Parman v. Petricciani, 70 Nev. 427, 272 P.2d 492 (1954). The trial court should review the record searchingly for material issues of fact, the existence of which eliminate the propriety of summary treatment. Further, pleadings and documentary evidence must be construed in a posture which is most favorable to the party against whom the motion for summary judgment is directed. Dugan v. First Nat. Bank In Wichita, 227 Kan. 201, 606 P.2d...
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