Pickett v. Mccarran Mansion, LLC

• Decision Date: 08 August 2017
• Docket Number: No. 70127,70127
• Parties: CYNTHIA PICKETT; AND CYNTHIA PICKETT, MSW, LCSW, LADC, INC., N/K/A CYNTHIA PICKETT MSW, LCSW, LADC, PC, Appellants, v. MCCARRAN MANSION, LLC, A NEVADA LIMITED LIABILITY COMPANY, Respondent.
• Court: Nevada Court of Appeals

CYNTHIA PICKETT; AND CYNTHIA PICKETT, MSW, LCSW, LADC, INC.,N/K/A CYNTHIA PICKETT MSW, LCSW, LADC, PC, Appellants, v. MCCARRAN MANSION, LLC, A NEVADA LIMITED LIABILITY COMPANY, Respondent.

No. 70127

COURT OF APPEALS OF THE STATE OF NEVADA

August 8, 2017

ORDER AFFIRMING IN PART, REVERSING IN PART AND REMANDING

This is an appeal from a district court order granting a motion for summary judgment.¹ Second Judicial District Court, Washoe County; Lynne K. Simons, Judge.

Appellants brought four claims below: breach of the covenant of quiet enjoyment, breach of contract, breach of implied covenant of good faith and fair dealing, and attorney fees. On appeal, appellants challenge five district court orders: (1) granting summary judgment in favor of respondent on appellants' breach-of-covenant-of-quiet-enjoyment claim and denying summary judgment on remaining claims; (2) granting respondent's motion in limine to exclude all of appellants' improperly disclosed damages and witnesses; (3) granting respondent's motion in limine to exclude evidence of damages in 2015 for failure to mitigate; (4) granting respondent's motion in limine to exclude appellants' economic loss expert; and (5) grantingsummary judgment on appellants' remaining claims for lack of proof of damages. See Consol. Generator-Nev., Inc. v. Cummins Engine Co., Inc., 114 Nev. 1304, 1312, 971 P.2d 1251, 1256 (1998) (holding that interlocutory orders may be heard in an appeal from the final judgment). We address each in turn.

This court reviews a district court's order granting summary judgment de novo. Wood v. Safeway, Inc., 121 Nev. 724, 729, 121 P.3d 1026, 1029 (2005). Summary judgment is proper if the pleadings and all other evidence on file demonstrate that no genuine issue of material fact exists and that the moving party is entitled to judgment as a matter of law. Id. When deciding a summary judgment motion, all evidence must be viewed in a light most favorable to the nonmoving party. Id. General allegations and conclusory statements do not create genuine issues of fact. Id. at 731, 121 P.3d at 1030-31.

A district court's ruling on a motion in limine is reviewed for an abuse of discretion. Whisler v. State, 121 Nev. 401, 406, 116 P.3d 59, 62 (2005). We review a district court's decision to admit or exclude evidence for an abuse of discretion. M.C. Multi-Family Dev., LLC v. Crestdale Assocs., Ltd., 124 Nev. 901, 913, 193 P.3d 536, 544 (2008); Las Vegas Metro. But when the "ruling rests on a legal interpretation of the evidence code," this court reviews the ruling de novo. Davis v. Beling, 128 Nev. 301, 311, 278 P.3d 501, 508 (2012) (internal quotation marks omitted).

1. The grant of summary judgment on the breach-of-covenant-of-quiet-enjoyment claim

Appellants argue that the district court erred by granting summary judgment on the breach-of-covenant-of-quiet-enjoyment claim on grounds that they failed to vacate in a reasonable time. Specifically, they contend that this issue is a question of fact that should be resolved by a jury. We agree.

A tenant will prove a breach-of-covenant-of-quiet-enjoyment claim by proving constructive eviction. Winchell v. Schiff, 124 Nev. 938, 947, 193 P.3d 946, 952 (2008). For a commercial tenant seeking to prove constructive eviction, the claim has four elements: (1) "the landlord must either act or fail to act," (2) "the landlord's action or inaction must render the whole or a substantial part of the premises . . . unfit for occupancy for the purpose for which it was leased," (3) "the tenant must actually vacate the premises within a reasonable time," and (4) the commercial tenant must show that it provided "the landlord notice of and a reasonable opportunity to cure the defect." Mason-McDuffie Real Estate, Inc. v. Villa Fiore Dev., LLC, 130 Nev. ___, ___, 335 P.3d 211, 214 (2014) (internal quotation marks omitted).

Below, respondent advanced two specific arguments in support of its request for summary judgment on this claim: first, respondent's acts or omissions did not render the whole or substantial part of the premises unfit for occupancy, and second, appellants did not vacate the premises within a reasonable period of time. The district court granted summary judgment only on the second ground, holding that appellants did not vacate the premises within a reasonable time from when the problems with the landlord began.

On appeal, respondent abandons its first argument and now argues only that the judgment should be affirmed because appellants failed to vacate in a reasonable time. Upon review of the record, construing all the evidence in a light most favorable to appellants, the nonmoving party below, we conclude that there is a genuine issue of material fact regarding whether appellants vacated the premises within a reasonable time. The "reasonable time" is not measured right from the start of problems between the landlord and tenant; rather, the time is measured from the moment upon which the problems have finally reached a sufficient level, for "the landlord's action or inaction must render the whole or a substantial part of the premises . . . unfit for occupancy for the purpose for which it was leased," which is what appellants contend happened through a series of events, and we agree that is a genuine issue of material fact. See id.

Further, because this was a commercial lease, appellants were required to provide the landlord with a reasonable opportunity to cure the defect, which necessarily prolongs the permissible time for the tenant to stay on the premises. Therefore, we conclude that a rational finder of fact could reasonably find on this record that appellants vacated within a reasonable time. As respondent advances no other argument for affirmance on appeal, we reverse this grant of summary judgment and remand for further proceedings.

2. The grant of respondent's motion in limine to exclude improperly disclosed damages and witnesses

Appellants argue that the district court abused its discretion in excluding some of appellants' witnesses, as well as their emails, due to late disclosure. A district court can exclude witnesses disclosed after discovery deadlines if no "substantial justification" is offered for the late disclosure, NRCP 37(c)(1), and on appeal, we review only for an abuse of discretion, seeYoung v. Johnny Ribeiro Bldg., Inc., 106 Nev. 88, 92, 787 P.2d 777, 779 (1990). Appellants disclosed these witnesses and their emails after the applicable discovery deadlines, and the district court did not abuse its discretion in concluding that appellants' alleged "lack of computer skills" was not a "substantial justification" for being untimely.² See NRCP 37(c)(1). Therefore, we affirm this order.

3. The grant of respondent's motion in limine to exclude evidence of damages from 2015

Appellants argue that the district court erred in ordering the exclusion of all evidence of damages from 2015 on grounds that appellants failed to reasonably mitigate their damages. We agree.

All relevant evidence is admissible unless (1) a restriction under Title 4 of the Nevada Revised Statutes applies, (2) the United States and Nevada Constitutions require exclusion of the evidence, or (3) "a statute limits the review of an administrative determination to the record made or evidence offered before that tribunal." NRS 48.025(1). The duty-to-mitigate-damages doctrine is not a restriction on the admissibility of evidence, but is instead an affirmative defense that, when proven by the defendant, limits the amount of damages a claimant may be awarded. See Nev. Ass'n Servs, Inc. v. Eighth Judicial Dist. Court, 130 Nev. ___, ___, 338 P.3d 1250, 1254 (2014) (holding that the defendant bears the burden of proving an affirmative defense); Clark Cty. Sch. Dist. v. Richardson Constr., Inc., 123 Nev. 382, 394 & n.20, 168 P.3d 87, 95 & n.20 (2007) (holding that mitigation of damages is an affirmative defense). Specifically, the doctrineprovides that if liability and damages are established, and the claimant is found to have failed to mitigate some or all of its damages, the amount of those damages that could have been reasonably avoided will be subtracted from the final monetary judgment. See Sheehan & Sheehan v. Nelson Malley & Co., 121 Nev. 481, 492, 117 P.3d 219, 226 (2005); James Hardie Gypsum (Nev.) Inc. v. Inquipco, 112 Nev. 1397, 1404-05, 929 P.2d 903, 908 (1996) (noting that the issue of reasonableness is a decision to be made by the trier of fact), disapproved of by Sandy Valley Assocs. v. Sky Ranch Estates Owners Ass'n, 117 Nev. 948, 35 P.3d 964 (2001); see also Rockingham Cty. v. Luten Bridge Co., 35 F.2d 301, 308 (4th Cir. 1929) (holding that the appropriate award when there is a failure to mitigate is subtracting the reasonably avoidable damages but still awarding the damages not reasonably avoidable, plus the profit which would have been realized had the contract been carried out in accordance with its terms); Robert A. Hillman, Principles of Contract Law 149-50 (2d ed. 2009). Therefore, the district court's exclusion of evidence of damages from 2015 was an abuse of discretion. See NRS 48.025; Davis, 128 Nev. at 311, 278 P.3d at 508.

4. The grant of respondent's motion in limine to exclude the economic loss expert

Appellants argue that the district court abused its discretion in granting respondent's motion in limine to exclude appellants' economic loss expert. "We review a district court's decision to admit expert testimony for an abuse of discretion." Leavitt v. Siems, 130 Nev. ___, ___, 330 P.3d 1, 5 (2014). The district court abuses its discretion when it "fail[s] to apply the full, applicable legal analysis," Gunderson v. D.R. Horton, Inc., 130 Nev. 67, 82, 319 P.3d 606, 616 (2014), or "bases its decision on a clearly erroneousfactual determination or it disregards controlling law," MB Am., Inc. v. Alaska Pac. Leasing Co., 132 Nev. ___, ___, 367 P.3d 1286, 1292 (2016).

In this case, the district court failed to address the...