El Ranco, Inc. v. First National Bank of Nevada

• Decision Date: 03 April 1969
• Docket Number: No. 20241.,20241.
• Citation: 406 F.2d 1205
• Parties: EL RANCO, INC., a Nevada corporation, El Ranco Hotel Operating Company, a Nevada corporation, Beldon R. Katleman, MCA Artists, Ltd., a Delaware corporation, Roy Gerber, and Matt Gregory, Appellants, v. The FIRST NATIONAL BANK OF NEVADA, as Administrator of the Estate of Rene Bardy, Deceased, Appellee.
• Court: U.S. Court of Appeals — Ninth Circuit

406 F.2d 1205 (1968)

EL RANCO, INC., a Nevada corporation, El Ranco Hotel Operating Company, a Nevada corporation, Beldon R. Katleman, MCA Artists, Ltd., a Delaware corporation, Roy Gerber, and Matt Gregory, Appellants, v. The FIRST NATIONAL BANK OF NEVADA, as Administrator of the Estate of Rene Bardy, Deceased, Appellee.

No. 20241.

United States Court of Appeals Ninth Circuit.

October 30, 1968.

Rehearing Denied April 3, 1969.

COPYRIGHT MATERIAL OMITTED

Samuel S. Lionel (argued), Foley Brothers, Matt Gregory in pro per, Las Vegas, Nev., Leo K. Gold, Rosenfeld, Meyer & Susman, Victor Netterville (argued), Beverly Hills, Cal., for appellants.

Morton Galane, Las Vegas, Nev. (argued), Robert List, Carson City, Nev., Joseph Alioto, San Francisco, Cal., for appellee.

Before HAMLIN, KOELSCH and BROWNING, Circuit Judges.

KOELSCH, Circuit Judge:

The late Wm. C. Mathes, that eminently perceptive and widely experienced trial judge, characterized this dispute "not only a kettle of fish, but scrambled eggs thrown in on top. * * *" He no doubt mixed the metaphor deliberately.

The plaintiff, Rene Bardy, a citizen of France was (according to his evidence) a veritable Florenz Ziegfeld of the European entertainment industry.¹ For years he produced lavish "French type" revues not only in the Montmartre District of Paris but in many cities throughout western Europe. These revues, often advertised through the press and other news media as "La Nouvelle Eve," after the night club in Paris where they originated, followed a uniform pattern — a series of tableaux featuring a liberal number of scantily clad mannequins interspersed with acts performed by similarly attired (or unattired) singers and dancers. It was perhaps inevitable that Bardy would eventually come to the attention of the proprietors of Nevada's gambling casinos, whose relentless quest for patronage has led them to spend immoderate sums for attractions baroque and sensational. So it was that late in 1958 MCA, Bardy's booking agent, secured for him an engagement at an establishment known as El Rancho Vegas.² The contract, dated December 1, 1958, and entered into with El Ranco Hotel Operating Co., called for a show with a cast of 32 people to be presented during the ten week period commencing January 28, 1959, and ending April 7. The agreed price was $15,000 a week.

In March, a further contract was entered into extending the run to June 2, on terms essentially the same as those in in the original contract, except El Ranco agreed to pay Bardy $5,000 net each week and itself assume all expenses arising in connection with the show.

The latter contract, however, never went into effect. On April 8, the first day of the extended term, Beldon Katleman, the manager-sole shareholder of El Ranco, declared a rescission on the ground that Bardy had committed a material breach. A week later the show did resume in a modified version and continued to play until June 2, when it ended. Subsequently, on July 29, the chorus girls of the La Nouvelle Eve show returned to the El Ranco Hotel where, in a production advertised as "La Nue Eve", they appeared until October 21.

Bardy's suit was in two parts. The first concerned a claim (hereinafter the "contract claim") against El Ranco Hotel Operating Co. for the unpaid balance allegedly due and owing on the December 1 contract. The second part, relating to the period from April 8 through October 21, concerned primarily an asserted civil conspiracy. Bardy's contention, as reflected in his complaint and the pretrial order was in substance that Katleman, Roy Gerber (MCA's Las Vegas representative), Matt Gregory and Fred Haettel had conspired and confederated together for the purpose of harming his property and contract rights with respect to the La Nouvelle Eve show and, pursuant to that conspiracy, had committed a number of wrongful acts; in addition to the actual conspirators he included as parties defendant under appropriate allegations and statements El Ranco Hotel Operating Co., its successor El Ranco, Inc., MCA and Turrett Corporation.

In the alternative Bardy, apparently believing this to be necessary to permit some recovery in the event the proof of an over-all conspiracy should fail, charged various of the allegedly conspiratorially inspired acts against those defendants whom he asserted were directly responsible.

At the conclusion of a protracted trial, the jury rendered verdicts as follows: On the "contract claim", for Bardy and against El Ranco Hotel Operating Co. in the amount of $27,281.00 (later reduced on Bardy's remittitur to $24,300.00); on the "conspiracy claim", for Bardy and against all defendants save Turrett Corporation and Haettel. Damages were assessed in the sum of $476,000, consisting of $251,200 compensatory and $225,000 punitive damages.³ All Defendants, save Turrett and Haettel, have appealed.

Matters in Abatement

A. El Ranco argues that Bardy was not the real party in interest, entitled to commence and prosecute the contract claim because, as appears on the face of the contract itself, the agreement was one between El Ranco Hotel Operating Co. and La Nouvelle Eve Corporation and not El Ranco and Bardy.

El Ranco's reliance upon the familiar parol evidence rule is misplaced. Subject to many exceptions, that rule operates merely to forbid evidence to vary the terms of a writing, not to prohibit proof as to who the parties to a contract in fact are. Annot., 80 A.L.R.2d 1137, 1144-1145 (1961). Here, there was substantial proof that no entity as La Nouvelle Eve Corporation had ever existed, that Bardy intended to and did sign the contract in his individual capacity and that El Ranco dealt with him accordingly.

B. Under the heading "The admission into evidence of assignments to appellee executed after commencement of the action was prejudicial error" appellants make what in substance is a contention that Bardy was not the real party in interest.

By Nevada law (NRCP 17(a)) an action must be commenced by the real party in interest; otherwise the complaint will be dismissed. Las Vegas Network, Inc. v. B. Shawcross, and Associates, 80 Nev. 405, 395 P.2d 520 (1964). And where the issue is whether a plaintiff is the real party in interest, an assignment of a claim to him after he has commenced an action thereon does not relate back to the time suit was commenced. Thelin v. Intermountain Lumber, etc., 80 Nev. 285, 392 P.2d 626 (1964).

Bardy commenced this suit as an individual asserting that he was the owner not only of the contract and conspiracy claims but also the property and property rights out of which the claims arose. Defendants challenged these assertions and affirmatively alleged that several other named persons and French "societes" (corporations) were. At the trial after Bardy had made out a prima facie case consistent with his allegations and defendants had countered with proof to the contrary, he then introduced in rebuttal written assignments to him from all the named persons and societes of any and all rights they had in both property and claims. Defendants objected to the admission of these instruments on the ground, among others, that they post-dated the commencement of the action.⁴ Appellants contend that the District Court erred because "under Nevada law an assignee has no claim unless the assignment was executed prior to commencement of this action" and urge that the error was prejudicial because the jury may have relied on the assignments in assessing damages.

However, unlike the plaintiffs in Thelin and Shawcross Bardy did possess an interest at the critical date aside from any thereafter acquired by assignment. The jury settled any question on that score for in rendering a verdict for Bardy on the contract claim it necessarily found that Bardy could agree to present the La Nouvelle Eve show, using its name, etc., and receive the moneys for so doing. The contract, of course, antedates the filing of the complaint. Nor could appellants have been prejudiced by the admission of these assignments; no proof whatever was offered or admitted of any injuries suffered by the appellants with respect to the subject matter of the assignments during the period following the filing of the complaint.

C. On the premise that Bardy used "La Nouvelle Eve" as a trade name in his Nevada dealings, appellants argue that he should not have been permitted access to the court because of his failure to comply with the Nevada assumed business name statutes which require "every person * * * conducting, carrying on or transacting business" in that State "under an assumed or fictitious name" to file for public record a certificate disclosing his true name and which make such filing a pre-condition to the commencement of action on "any contract made or transaction had" or "on account of any cause of action arising or growing out of the business so carried on under such name or designation * * *" (Nevada Rev.Stat. 602.010, 602.020 and 602.070). The trial judge ruled as a matter of law that Bardy's activities did not constitute the "conducting" etc. of business within the purview of the statute.

The Nevada Supreme Court, in the only local case construing these statutes, has taken the position generally held by courts of other states having similar legislation See for example Bacon v. Gardner, 38 Wash.2d 299, 229 P.2d 523 (1951) that the phrase "conducting, etc. of business" does not include an occasional or isolated business transaction but rather connotes continual commercial activity. Paterson v. Condos, 55 Nev. 134, 144, 28 P.2d 499 (1934).⁵

In the instant case it was not disputed that Bardy entered Nevada for the sole purpose of presenting his revue at the El Rancho Hotel and with the definite intention to leave at the end of the engagement, that his business dealings were limited to matters incidental to such presentation, and that his actual stay was not of long duration. On these facts we cannot say that the...