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Federal Diversity of Corporations Under Hertz Corp. v. Friend et al

 

In a decision likely to have significant consequences for federal subject-matter jurisdiction, Hertz Corp. v. Friend et al., No. 08-1107 (U.S. February 23, 2010), the United States Supreme Court clarified a jumble of approaches used by the lower federal courts and endorsed the “nerve center” test for determining a corporation’s principal place of business for purposes of establishing diversity among litigants.

 This decision will often affect where a corporation with geographically diverse business activities may be subject to suit in federal court on diversity grounds, and should lead to greater predictability in determining when a federal court will find diversity jurisdiction to be present. Generally speaking, a party is subject to suit in federal court only if the action implicates a “federal question,” or if all the plaintiffs are citizens of different States than all the defendants—they are “diverse”-and the amount in controversy exceeds $75,000.

Under 28 U.S.C. § 1332 (c) (1), the federal diversity jurisdiction statute, a corporation is a citizen of the State in which it has been incorporated and where it has its principal place of business. In Hertz Corp. v. Friend (No. 08-1107), the Supreme Court unanimously endorsed the "nerve center" approach for determining the state in which a corporation has its principal place of business.

 The Court concluded "that the phrase 'principal place of business' refers to the place where the corporation's high level officers direct, control, and coordinate the corporation's activities," adding that "the 'nerve center' will typically be found at a corporation's headquarters." Although the Court's decision addressed the statute's text and legislative history, the Court placed particular emphasis on the administrative simplicity of the "nerve center" approach.

 It noted that complex jurisdictional rules "encourage gamesmanship" and waste judicial resources. Simple jurisdictional rules, however, promote greater predictability for "corporations making business and investment decisions" and for "plaintiffs deciding whether to file suit in a state or federal court." Although the Court acknowledged that the "nerve center" test will not always be precise, it is comparatively simpler than tests focusing on a corporation's operations.

 The Court also affirmed that the burden of persuasion remains on the party asserting diversity jurisdiction and emphasized that the "nerve center" approach does not permit jurisdictional manipulation. A party challenged in its assertion of jurisdiction must support its allegations by competent proof. For example, the Court noted that the mere filing of a form like the Securities and Exchange Commission's Form 10-K listing a corporation's "principal executive offices" would not, on its own, establish the corporation's "nerve center."

Nonetheless, even if the record shows manipulation, courts do not revert to the corporation's "place of operations." Rather, the court must identify the place of actual direction, control, and coordination of the corporation, in the absence of such manipulation. The Supreme Court concluded that the phrase "principal place of business" for purposes of federal diversity jurisdiction refers to "the place where the corporation's high-level officers direct, control, and coordinate the corporation's activities," and not - as some circuits have held - a more in-depth state-by-state analysis of such factors as manufacturing and sales office locations.

 In establishing a unitary "principal place of business" definition, the Court resolved an unwieldy split in the circuits as to the applicable test, settling on what has often been referred to as the "nerve center" test. "Principal Place Of Business" And Its Importance The phrase "principal place of business" derives from the federal diversity jurisdiction statute: "a corporation shall be deemed to be a citizen of any State by which it has been incorporated and of the State where it has its principal place of business ." 28 U.S.C. § 1332(c)(1) (emphasis added).

Determining "principal place of business" under the federal diversity statute is important because it is the first step in analyzing whether a corporation can remove a case to federal court based on diversity jurisdiction - a common goal for corporate defendants. A corporation will be foreclosed from removing a state action to federal court if its "principal place of business" (or incorporation) is in a state where any plaintiff is also a "citizen."

Personal Jurisdiction in Nevada

 

LEGAL STANDARD TO DETERMINE PERSONAL JURISDICTION

            On a motion to dismiss, the plaintiff bears the burden of establishing personal jurisdiction is proper.  College Source, Inc. v. Academy One, Inc., 653 F. 3d 1066, 1073 (9th
Cir. 2011).  A court may not assume the truth of allegations in a pleading that are contradicted by affidavit.  Id.

 

            This Court has recently explained the legal standard used when considering a motion to dismiss for lack of personal jurisdiction in Corbello v. DeVito, 844 F. Supp. 2d 1136 (D. Nev. 2012). Personal jurisdiction exists only if exercise of personal jurisdiction complies with Nevada’s “long-arm” statute and federal due process standards.  Nevada’s “long-arm” statute provides for personal jurisdiction to the full extent of federal due process. 
Therefore, the Court need only apply federal due process standards to
determine personal jurisdiction.  Id. at 1148.

 

There are two categories of personal jurisdiction: general jurisdiction and specific jurisdiction.
General jurisdiction exists over a defendant who has “substantial” or “continuous and systematic” contacts with the forum State such that the assertion of personal
jurisdiction over him is constitutionally fair even where the claims are unrelated
to those contacts.  

Id. at 1148-49 (citations omitted).

 

Even where there is no general jurisdiction over a defendant, specific jurisdiction exists when there are sufficient minimal contacts with the forum such that the assertion of personal jurisdiction “does not offend ‘traditional notions of fair play and substantial justice.’ ”  . . . See Hanson v. Denckla, 357 U.S. 235, 253, 78 S.Ct. 1228, 2 L.Ed.2d 1283
(1958)
(“[I]t is essential in each case that there be some act by which the defendant purposefully avails itself of the privilege of conducting activities within the forum State, thus
invoking the benefits and protections of its laws.” (citing Int'l Shoe Co., 326 U.S. at 319, 66 S.Ct. 154) (emphasis added)); World–Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 297, 100 S.Ct. 559, 62 L.Ed.2d 490 (1980) (“[T]he foreseeability
that is critical to due process analysis is not the mere likelihood that a
product will find its way into the forum State. Rather, it is that the
defendant's conduct and connection with the forum State are such that he should
reasonably anticipate being haled into court there.” (citing Kulko v. Superior Court of Cal., 436 U.S. 84, 97–98, 98 S.Ct. 1690, 56 L.Ed.2d 132 (1978)) (emphasis added). From
these cases and others, the Ninth Circuit has developed a three-part test for
specific jurisdiction:

 

(1) The non-resident defendant must purposefully
direct his activities or consummate some transaction with the forum or resident
thereof; or perform some act by which he purposefully avails himself of the
privilege of conducting activities in the forum, thereby invoking the benefits
and protections of its laws;

 

(2) the claim must be one which arises out of or
relates to the defendant's forum-related activities; and

 

(3) the exercise of jurisdiction must comport with
fair play and substantial justice, i.e. it must be reasonable.



Boschetto, 539 F.3d at 1016 (quoting Schwarzenegger v. Fred Martin Motor Co., 374 F.3d 797, 802 (9th Cir.2004)).

The plaintiff bears the burden on the first two
prongs. If the plaintiff establishes both prongs one and two, the defendant
must come forward with a “compelling case” that the exercise of jurisdiction
would not be reasonable. But if the plaintiff fails at the first step, the
jurisdictional inquiry ends and the case must be dismissed.

 

Id. at 1149.

  1. II.               
    LEGAL ANALYSIS

 

It appears Plaintiffs are attempting to establish specific jurisdiction over R. 
R does not have substantial, continuous and systematic contacts with
Nevada necessary to establish general jurisdiction.  The standard for establishing general
jurisdiction is fairly high and requires the defendant to have contacts that
approximate physical presence in the forum.  Young v. Actions Semiconductor
Co., Ltd.,
386 Fed. Appx. 623, 626 (9th Cir. 2010).

 

The inquiry discussed above regarding specific jurisdiction has been succinctly described
as turning on a trio of criteria:  (1) purposeful availment (or minimum contacts), (2) relatedness and (3) reasonableness.  Autogenomics, Inc. v. Oxford Gene Technology Lmt., 556 F. 3d 1012, 1024 (Fed. Cir. 2009).  Plaintiffs in this case cannot meet any of
these criteria.  Most significantly, R has no minimum contacts with Nevada sufficient to confer personal jurisdiction and the inquiry should end there.  The claim for fraud is not related to the miniscule and attenuated contact R had with Nevada.  Lacking minimum
contacts and relatedness, this Court’s exercise of personal jurisdiction would
violate due process. 

 

  1. A.       R has no minimum contacts sufficient
    to establish jurisdiction in Nevada.

            The very recent case of Walden v. Fiore, 134 S. Ct. 1115 (2014), is directly on point. 
In Walden, the Supreme Court decided that a defendant’s actions in Georgia could not establish personal jurisdiction in Nevada even though the defendant’s actions caused damages in
Nevada.  The plaintiffs in Walden were professional gamblers and
Nevada residents.  Id. at 1119-1120.  When returning from a gambling trip to Puerto Rico, they were stopped by a DEA agent at Atlanta’s airport and the DEA agent confiscated $97,000 in cash on suspicion that the money was drug related. Id.  The DEA agent knew that the plaintiffs were Nevada residents at the time he seized the money. Id.  Plaintiffs maintained
that the money was from gambling and the DEA eventually returned the $97,000. Id. 
The plaintiffs sued the DEA agent in Nevada for monetary damages.  Id.

 

Walden addresses the minimum contacts necessary to create personal jurisdiction.  Id. at 1121.  Because Walden is directly on point, R will quote from it extensively.  In explaining the minimum contacts analysis, the Supreme Court emphasized that it must be the defendant who creates the contact with the forum state:

 

First, the relationship must arise out of contacts that the “defendant himself” creates with the forum State. Burger King Corp. v. Rudzewicz, 471 U.S. 462, 475, 105
S.Ct. 2174, 85 L.Ed.2d 528 (1985)
. Due process limits on the State's adjudicative authority
principally protect the liberty of the nonresident defendant—not the
convenience of plaintiffs or third parties. See World–Wide Volkswagen
Corp., supra,
at 291–292, 100 S.Ct. 559.
We have consistently
rejected attempts to satisfy the defendant-focused “minimum contacts” inquiry
by demonstrating contacts between the plaintiff (or third parties) and the
forum State. See Helicopteros Nacionales de Colombia, S.A. v. Hall,
466 U.S. 408, 417, 104 S.Ct. 1868, 80 L.Ed.2d 404 (1984)
(“[The] unilateral activity of another party or a third person is not an appropriate consideration when determining whether a
defendant has sufficient contacts with a forum State to justify an assertion of
jurisdiction”). . . Put simply, however significant the plaintiff's contacts with the forum may be, those contacts cannot be “decisive in determining whether the defendant’s due process rights are violated.” Rush, 444 U.S., at 332, 100 S.Ct. 571.

 

Id. at 1122-23 (emphasis supplied).

 

            Second, a “minimum contacts” analysis looks to the defendant's contacts with the forum state itself, not the defendant's contacts with persons who reside there.  Id.

 

But the plaintiff cannot be the only link between the defendant and the forum.
Rather, it is the defendant's conduct that must form the necessary connection
with the forum State that is the basis for its jurisdiction over him.
See Burger King, supra, at 478, 105 S.Ct. 2174 (“If the question is whether an individual's
contact with an out-of-state party alone can automatically establish sufficient minimum contacts in the other party's home forum, we believe the answer clearly is that it cannot”); Kulko v. Superior Court of Cal., City and County of San Francisco, 436 U.S. 84, 93, 98 S.Ct. 1690, 56 L.Ed.2d 132 (1978) (declining to “find personal jurisdiction in a
State ... merely because [the plaintiff in a child support action] was residing
there”). To be sure, a defendant's contacts with the forum State may be
intertwined with his transactions or interactions with the plaintiff or other
parties. But a defendant's relationship with a plaintiff or third party,
standing alone, is an insufficient basis for jurisdiction. See Rush, supra, at 332, 100 S.Ct. 571 (“Naturally, the parties' relationships with
each other may be significant in evaluating their ties to the forum. The
requirements of International Shoe, however, must be met as to each
defendant over whom a state court exercises jurisdiction”). Due process requires that a defendant be haled into court in a forum State based on his own affiliation with the State, not based on the “random, fortuitous, or attenuated” contacts he makes by
interacting with other persons affiliated with the State.
Burger King, 471 U.S., at 475, 105 S.Ct. 2174 (internal quotation marks omitted).

 

These same principles apply when intentional
torts are involved. In that context, it is likewise insufficient to rely on a
defendant's “random, fortuitous, or attenuated contacts” or on the “unilateral
activity” of a plaintiff. Ibid. (same). A forum State's exercise of
jurisdiction over an out-of-state intentional tortfeasor must be based on
intentional conduct by the defendant that creates the necessary contacts with
the forum.

      

Id. at 1122-23.
(emphasis supplied)

 

Applying the foregoing principles the Supreme Court in Walden concluded that the
defendant lacked the “minimal contacts” with Nevada that are prerequisite to
the exercise of jurisdiction.  Id. at 1124Like Reina, no part of the
defendant’s alleged conduct in Walden occurred in Nevada. The DEA agent seized the cash at issue in the Atlanta airport.  R allegedly made fraudulent misrepresentations from Florida to H and C when they lived in Oregon.  The DEA agent never traveled to,
conducted activities within, contacted anyone in, or sent anything or anyone to
Nevada.  R has only been to Nevada one time for a wedding.  “In short, when
viewed through the proper lens—whether the defendant’s actions connect
him to the forum—petitioner formed no jurisdictionally relevant contacts
with Nevada.”  Id.  Like the DEA agent in Walden, R has no contacts (or
purposeful availment) with Nevada.

 

Third, the Supreme Court in Walden also rejected any argument to establish personal
jurisdiction based on an effects test, i.e. damages sustained in Nevada.  In
reversing the Ninth Circuit, the Supreme Court stated:

 

The Court of Appeals reached a contrary
conclusion [finding jurisdiction] by shifting the analytical focus from
petitioner's contacts with the forum to his contacts with respondents. Rather
than assessing petitioner's own contacts with Nevada, the Court of Appeals
looked to petitioner's knowledge of respondents' “strong forum connections.” In
the court's view, that knowledge, combined with its conclusion that respondents
suffered foreseeable harm in Nevada, satisfied the “minimum contacts” inquiry.

 

This approach to the “minimum contacts” analysis impermissibly
allows a plaintiff's contacts with the defendant and forum to drive the
jurisdictional analysis. Petitioner's actions in Georgia did not create sufficient
contacts with Nevada simply because he allegedly directed his conduct at
plaintiffs whom he knew had Nevada connections. Such reasoning improperly
attributes a plaintiff's forum connections to the defendant and makes those
connections “decisive” in the jurisdictional analysis. It also obscures the
reality that none of petitioner's challenged conduct had anything to do with
Nevada itself.

 

*  *  *

Respondents' claimed injury does not evince a connection between petitioner and Nevada. Even if we consider the continuation of the seizure in Georgia to be a distinct injury, it is not the sort of effect that is tethered to Nevada in any meaningful way. Respondents (and only respondents) lacked access to their funds in Nevada not because anything independently occurred there, but because Nevada is where respondents chose to be at a time when they desired to use the funds seized by petitioner. Respondents would have experienced this same lack of access in California, Mississippi, or wherever else they might have traveled and found themselves wanting more money than they had.

 

*  *  *

Well-established principles of personal jurisdiction are sufficient to decide this case. The proper focus of the “minimum contacts” inquiry in intentional-tort cases is “ ‘the relationship
among the defendant, the forum, and the litigation.’ ” And it is the defendant,
not the plaintiff or third parties, who must create contacts with the forum
State. In this case, the application of those principles is clear: Petitioner's
relevant conduct occurred entirely in Georgia, and the mere fact that his
conduct affected plaintiffs with connections to the forum State does not
suffice to authorize jurisdiction.

 

Id. at 1125-26 (citations omitted and emphasis supplied).

 

            This case is even weaker than Walden because at least in Walden the
plaintiffs were residents of Nevada at the time of the alleged tort.  In this case, the purported conduct relevant to the alleged fraud occurred between a Florida resident, R, and Oregon
residents.   Media did not even exist in 2010. 

 

H and C moving to Nevada and forming a Nevada corporation to act as a TF Associate after the alleged fraudulent misrepresentations occurred is unilateral activity on their part.  Plaintiffs’ move to Nevada and formation of Media are the kinds of random, fortuitous and attenuated contacts that the Supreme Court stated were not sufficient to establish personal jurisdiction in Walden.  These after the fact, unilateral events are not a contact with Nevada created by R and cannot be viewed as R purposely availing himself of some right associated with Nevada. 

 

That Plaintiffs allegedly experienced damages in Nevada does not establish that R created
contacts with Nevada.  The Supreme Court in Walden squarely rejected the
argument that damages incurred in Nevada can create personal jurisdiction in
Nevada.  See also, Sage Computer Tech. v. P-Code Dist. Comp., 576 F. Supp.
1194, 1196 (D. Nev. 1983)(“More impact or effects caused within the State from
outside activities is not sufficient to support the exercise of
jurisdiction.”).

Tolling Agreements in Nevada (Contractually Modified Statutes of Limitation)

 

For decades, there was some lingering doubt about how the Nevada Supreme Court just would treat tolling agreement.  Finally, in 2013, the Nevada Supreme Court addressed the issue regarding contractually modified statutes of limitations periods.  In Holcomb
Condominium Homeowner’s Association v. Stewart Venture LLC
., 300 P.3d
124 (Nev. 2013), the court stated as follows:

 

“Whether a party may contractually modify a statutory limitations period is an issue of
first impression in Nevada.  However, in other jurisdictions, it is well
established, that in the absence of a controlling statute to the contrary, a
provision in a contract may validity limit, between the parties, the time for
bringing an action on such contract to a period less than prescribed in the
general statute of limitations, provided that the shorter period itself shall
be a reasonable period. (Citations omitted).  The policy underlying this
rule is the recognition of parties’ freedom to contract. (Citations
omitted).  Because Nevada has long recognized a public interest in
protecting the freedom of persons to contract, we join these jurisdictions and
hold that a party may contractually agree to a limitations period shorter than
that provided by statute as long as there exists no statute to the contrary and
the shortened period is reasonable, and subject to normal defenses including
unconscionability and violation of public policy. “

 

The drafter of a tolling agreement should keep in mind that some states,
such as Michigan, have held that in order for a tolling agreement to be enforceable,
it must be for a specific and reasonable time period.  It cannot for an indefinite period of time.  The Michigan Court of Appeals in Pitch v. Blandford (2004) held that indefinite time periods would violate public policy and allow suit to be filed many years after the cause of action
accrued.  Hence, the parties should  negotiate and thenexpressly identify in their tolling agreement a specific deadline that is reasonable. 

We have found no cases in Nevada at this writing directly on point with respect to contractually extending or lengthening the statute of limitations period.  We did, however, locate an ALR Report entitled “Validity of Contractual Provision Establishing Period of Limitations Longer
than that provided by Statute of Limitations.”  See, 84 ALR 3d 1172. 
Although originally published in 1978, the ALR database is apparently updated
weekly.  This  ALR article suggests that California, Colorado, Montana and
Illinois would recognize such tolling agreements (under a variety of
conditions), but that Alabama and Kentucky have repeatedly refused to recognize
such provisions as being against public policy.  Rather than try and
predict which way the Nevada court may hold, it may be prudent in certain cases to simply
file the complaint and then stipulate to hold the case in abeyance for a time in order to allow
settlement negotiations to continue.

 

About the Authors: The law firm of Albright, Stoddard, Warnick & Albright is an A-V Rated Nevada-based full-service law firm having attorneys licensed in Nevada, California and Utah. Our firm’s practice includes a strong emphasis on real estate, secured finance and litigation.

Note: This article, and any other information you obtain at this website, is not offered as legal advice, nor should it be relied upon as such, nor is it a solicitation for legal services. Only a licensed attorney can advise you with respect to your specific legal needs. We welcome your contacting our firm to discuss such representation. Contacting us does not create an attorney-client relationship. Please do not send any confidential information to us until such time as an attorney-client relationship has been established.

Which State's Law Applies When Attacking Foreign Judgments?

 

  The Nevada supreme court in Clint Hurt & Associates vs. Silver State Oil and Gas Co. Inc., 111 Nev. 1086, 901 P.2d 703 (Nev. 1995) explained that:

 

“The full faith and credit clause of the United States Constitution demands that Nevada courts respect the final judgment of a state, absent a showing of fraud, lack of due process, or lack of
jurisdiction in the rendering state.   (Citations omitted).  We conclude that the district court erred when it held that the respondents were denied due process.  Service through return receipt postage is reasonably calculated to apprise interested parties of the pendency of the action and afford them an opportunity to present their objections.  (Citations omitted).  … The defenses preserved by Nevada’s Uniform Enforcement of Foreign Judgments Act and available under NRCP 60(b) are limited to those defenses that a judgment creditor may constitutionally raise under the full faith and credit clause and which are directed to the validity of the foreign
judgment. (Citations omitted)  Virginia law determines whether the West Virginia court properly
exercised jurisdiction over the immediate case.  The respondents cite no West Virginia law that deprives the West Virginia court of jurisdiction over then.  The respondents should have raised the issue with the West Virginia court whether the respondents’ interest was in personal or real
property.  We will not, as requested by respondents, look behind the West Virginia judgments.  We conclude that the district court erred when it refused to enforce the West Virginia judgments on the ground that the respondents did not receive adequate notice;…”

 

Hence, a defendant may try to assert that he was deprived of due process of law and that he received no notice of the pendency of the foreign proceedings filed
action against him.  However, the plaintiff will then assert that the defendant needs to bring a
motion to set aside the judgment in the rendering state and not in Nevada.

 

About the Authors: The law firm of Albright, Stoddard, Warnick & Albright is an A-V Rated Nevada-based full-service law firm having attorneys licensed in Nevada, California and Utah. Our firm’s practice includes a strong emphasis on real estate, secured finance and litigation.

Note: This article, and any other information you obtain at this website, is not offered as legal advice, nor should it be relied upon as such, nor is it a solicitation for legal services. Only a licensed attorney can advise you with respect to your specific legal needs. We welcome your contacting our firm to discuss such representation. Contacting us does not create an attorney-client relationship. Please do not send any confidential information to us until such time as an attorney-client relationship has been established.

Sample Nevada Form Motion to Dismiss for Lack of Subject Matter Jurisdiction

 

D. CHRIS ALBRIGHT, ESQ.

NevadaBar No. 004904

ALBRIGHT, STODDARD,
WARNICK & ALBRIGHT

801
  South Rancho Dr., Suite D-4

Las
  Vegas,
NV 89106

Tel:  (702) 384-7111

Fax: (702) 384-0605

dca@albrightstoddard.com

Attorneys
for Defendants

 

 

UNITED STATES DISTRICT COURT

 

DISTRICT OF NEVADA

 

MARIO SCIORTINO,
  an individual, and UNIQUE RV & AUTO WORKS, INC., dba UNIQUE MOVIE CARS,

 

                                               Plaintiffs,

            vs.

DANA MECUM, an
  individual; MECUM AUCTION INC., an Illinois corporation dba MECUM AUCTIONS
  and/or assumed name THE MECUM COLLECTION, MECUM AUCTION, INC., a Delaware domestic
  close corporation, KEN PORTER AUCTION CO., a California corporation, and DOES
  I through X, inclusive,

 

                                               Defendants.

)

)

)

)

)

)

)

)

)

)

)

)

)

)

)

)

)

)

)

)

 

Case
  No.
 
 
2:10-cv-02254

 

 

 

MOTION TO
  DISMISS

 

            COMES NOW all of the Defendants listed in the caption, by and through their undersigned counsel of record, and hereby move this Court for an order dismissing this case for lack of jurisdiction, and, as to Defendant Ken Porter Auction, Co., on the additional
grounds of failure to name the proper party.  This motion is based on the following points and authorities and the declarations of witnesses attached hereto.

/ /
/

/ /
/

POINTS &
AUTHORITIES IN SUPPORT OF MOTION TO DISMISS

I.          STATEMENT OF FACTS

 

            The Plaintiffs’ lawsuit is based upon allegations of breach alleged by Plaintiffs
against Defendants arising out of an “Auction Listing Contract” Plaintiff
alleges is between Plaintiffs and one ore more of the Mecum Auction Defendant
entities, dated May 13, 2010, with respect to an auction to take place in
Monterey, California (see, Plaintiffs’ Complaint at Exhibit 3); an
“Entry Guideline” Agreement executed by Plaintiff Mario Sciortino on May 13,
2010 (Plaintiffs’ Complaint at Exhibit 5); and various facts alleged in
Plaintiffs’ Complaint including with respect to an auction of a vehicle owned
by Plaintiff Sciortino, allegedly through Defendants, which auction occurred in
California in 2010.

            Plaintiffs’ Complaint references a meeting held between Plaintiff Mario Sciortino and Defendant Dana Mecum which allegedly occurred in Henderson,
Nevada in 2008.  It is obvious that Plaintiff has referenced
this conversation, at paragraph 16 of the Complaint, in the hopes of reaching
jurisdiction against the Mecum Defendants.  However, it should be noted that whatever meeting may have occurred in 2008 does not appear to have led to any immediate arrangements between the parties, since the written Agreements actually being sued on in this case, and attached to Plaintiffs’ Complaint, were not entered into until May of 2010.  See also, Dana Mecum Declaration, Exhibit A hereto.  Based on documents executed in May of 2010 by
Plaintiff, certain of the Mecum Defendants, based in Illinois,
agreed to sell the Plaintiff Mario Sciortino’s vehicle at an auction to be held
in California.  The California auction was handled by a California
entity known as CHP Enterprises, which does business as Cinema Vehicles, and
which also does business as “Ken Porter Auctions.”  See, Declaration of Ray Claridge
attached as Exhibit B hereto.  However, it must be understood that CHP
Enterprises purchased certain assets, including the right to use the “Ken
Porter” name for its auction business, from Ken Porter Auction Co.  Nevertheless, the actual Ken Porter Auction, Co. entity continues to exist.  That entity, however, which has been named in this lawsuit, had nothing to do with the auction at issue in this suit.  As
explained in Claridge’s Declaration, at ¶¶ 2-5:

            2.         My company, CHP Enterprises dba Ken Porter Auctions, is the company which handled the California auction referenced in Plaintiff’s lawsuit known as U.S. District Court Case No. 2:10-cv-02254.

3.    The company which has been named in the Plaintiff’s lawsuit, as Ken Porter Auction Co., a California corporation, is not my company and is not the company which was involved in the
subject California auction described in Plaintiff’s lawsuit.

4.    I bought the right to utilize the “Ken Porter” name, along with certain other assets, from Ken Porter Auction Co., a California corporation, in 2001, from the owner of that
business, Kathleen Porter who, to my knowledge, was the sole shareholder of Ken
Porter Auction Co., a California corporation, at that time.

5.    The entity which has been named as a Defendant in this suit, Ken Porter Auction Co., a California corporation, still exists, notwithstanding the fact that its auction-related assets were bought by me in 2001.  Its continued existence is because it owns certain real property assets which were not part of the asset sale to my company CHP Enterprises, and were not part of the auction business.  Ken Porter Auction Co., a California corporation, however, had nothing
to do with the auction described in Plaintiff’s lawsuit and should be dismissed
from this case.

 

Exhibit B,
¶¶ 2-5.

            On the basis of the documents with
respect to this auction, the parties agreed to the transactions subsequently
referenced in the Plaintiffs’ Complaint.

            Among the documents and agreements
referenced in Plaintiffs’ Complaint is an “Entry Guideline” Agreement executed
by Plaintiff Sciortino on May 13, 2010 and attached as Exhibit 5 to the
Complaint, which indicates at paragraph 14 as follows:

14.  This Agreement shall be governed by and
interpreted under the laws of the State of Illinois. 
By signing this document, both parties agree that any action that must
be taken to enforce the terms of this agreement shall be brought in the Circuit
Court of McHenry County, Illinois.

 

            Plaintiffs’ Complaint then contends that an auction occurred on August 14, 2010 in California. 

            Although the core claims of Plaintiffs’ contentions are somewhat ambiguous, the crux of Plaintiffs’ Complaint appears to be that the Defendants failed to allow bidding for the
subject vehicle beyond a $300,000.00 price, that one of the Mecum Defendants
and/or Ken Porter Auctions, themselves, purchased the subject vehicle rather
than having it purchased by a bidder, and that the Defendants failed to go
through with this purchase transaction, such that the Defendants allegedly
breached various contractual duties arising out of the agreements by Plaintiff
to list the vehicle for sale with the Defendants, at a California auction.

            However, Plaintiff has failed to demonstrate that Nevada
has jurisdiction over any of these Defendants.

II.        LEGAL ANALYSIS

  1. A.               
    None of the Defendants are Subject to the Jurisdiction of the Nevada Courts,

            as
They Have had no Contacts with Nevada
Sufficient to Confer Jurisdiction

            Over
Such Defendants (and the Wrong Ken Porter Defendant has been

            named).

 

            Nevada's long-arm statute, NRS 14.065, is broadly written to effectuate jurisdiction,
"on any basis not inconsistent with the Constitution of this state or with
the Constitution of the United   States."  NRS 14.065(1).  Accordingly, Nevada largely looks to the federal courts to determine the extent to which it may exercise jurisdiction over out-of-state defendants.  See, e.g., Casentini v. District Court, 110 Nev. 721, 877 P.2d
535, 539 (1994):  "Nevada has long construed its long-arm statute 'to be broad enough to reach the outer limits of federal constitutional due process.'  Levison v. District
Court
, 103 Nev. 404, 406, 742 P.2d 1024, 1025 (1987)."

            Under those federal constitutional standards, jurisdiction may be exercised based
upon a theory of either general or specific jurisdiction.  As is shown by the Affidavit of Defendant Mecum attached herewith as Exhibit A, and of Ray Claridge attached as Exhibit B, and Kathleen Porter attached as Exhibit C, in this case neither prerequisite is met.

            For example, "general jurisdiction [exists] where a defendant is held to
answer in a forum for causes of action unrelated to the defendant's forum
activities."  Trump v. District Court, 109 Nev. 687, 699, 857 P.2d 740, 748 (1993) (citations omitted).  "General jurisdiction over the defendant
'is appropriate where the defendant's forum activities are so
"substantial" or "continuous and systematic" that [the defendant]
may be deemed present in the forum.'"  Id. (citations omitted).

            In this case, as shown by the Declaration of Defendant Dana Mecum attached hereto,
as Exhibit A, Mr. Mecum is a lifelong resident of Illinois and the Mecum
entity Defendants have no employees in Nevada, and no property or on-going presence in Nevada.  Id.  While Mr. Mecum sometimes visits Nevada for tradeshows or
conventions, neither he nor his companies have any continuing presence here.  Id.  The Mecum company Defendants sometimes advertise in national publications that are available in both Nevada and the other states, but do not conduct any targeted advertising in Nevada.  Id.  Accordingly, none of the Mecum Defendants’ contacts with the State of Nevada have been
either "substantial" nor "continuous and systematic," such that Nevada
certainly has no general jurisdiction over the Defendants.

            Similarly, as shown by Exhibit B hereto, the California
entity which handled the auction in California, CHP Enterprises d/b/a Ken Porter Auctions (in addition to not having been properly named herein) has no presence or contacts in Nevada
sufficient to confer jurisdiction by Nevada courts over it.  For example, as Ray
Claridge explains:

6.    To the degree that Plaintiff names my company, CHP Enterprises d/b/a Ken Porter Auctions, as a Defendant in this case, the case should not go forward in Nevada
as I do not believe Nevada has any jurisdiction over CHP Enterprises.

7.    CHP Enterprises does not do business inNevadaand does not own or lease any real property inNevadaand does not have any employees inNevada.

8.    CHP Enterprises does maintain a website,
which can be accessed from Nevada as well as
from all of the other 50 states and throughout the world, but CHP Enterprises
does not do any advertising targeted directly atNevada.

9.    All of my involvement in the auction
described in the Mario Sciortino lawsuit for which this declaration is
provided, was based on communications which I had from California, with Dana
Mecum, in Illinois, and I did not have any communications, or sign any contract
with, or otherwise interact with, call into, or visit, Nevada, at any time,
with respect to the auction at issue in the Mario Sciortino lawsuit.

10.  Based on the foregoing, I had no expectation
that I could end up being sued in Nevada as a result of having arranged with an
Illinois auction company, to perform an auction in California.

 

Exhibit B, at ¶¶ 6-10.

           

            Significantly, Nevada also lacks jurisdiction over the entity
which was mistakenly named in this suit, Ken Porter Auction Co., a California
corporation.  As explained in the Declaration of that entity’s President, Kathleen Porter, attached as Exhibit C hereto.

1.         I am the President of Ken Porter Auction Co., a California
corporation.

2.         My company, Ken Porter Auction Co., does not do any auctions any more and has not done so since
2001, when, after my husband’s death, I sold the assets of the company relating
to auctions to CHP Enterprises, which was also sold the right to use the Ken
Porter Auctions name as a d/b/a. 
Nevertheless, my company has been named as a defendant in U.S. District
Court Case No. 2:10-cv-02254, with respect to an auction which my company had
nothing to do with.  My company maintained its corporate existence after the asset sale to CHP simply because it owns certain real property in California,
which was not sold as part of the sale of other company assets.  However, my company should not have been named in this suit, since my company was not involved in the auction referred
to in the lawsuit.  Rather, any such auction performed under the Ken Porter name would have been performed by CHP Enterprises, which bought the right to use the “Ken Porter” name for its auctions in 2001.

3.         It should also be noted that my company, Ken Porter Auction Co., a California corporation, does not now and never has done business in Nevada and does not own or lease and has never owned or leased any real property in Nevada and does not have, and has
never had, any employees in Nevada, and does not do any advertising in
Nevada.  Thus, even if there were a legitimate claim of some sort against my company (which there is not), that claim should not be brought in a way that requires my company to appear and defend in Nevada since to my knowledge my company has never done anything that would giveNevada jurisdiction over it.

 

Exhibit
C
,
Kathleen Porter Declaration at ¶¶ 1-3.

            (It
might be noted that defense counsel, as well as out-of-state counsel for CHP,
has informed Plaintiffs’ counsel of the foregoing facts as to which entity
should have been named as the entity which has admitted it was the actual
involved California auction company handling the auction.  Defense counsel was not simply asked to
dismiss the inaccurate party from the action without any explanation as to who
should have been named, but was expressly informed of the name of an
alternative defendant who was admitting to being the party that was actually
involved and could be named instead.  However,
Plaintiffs’ counsel declined to agree to amend the complaint to name the right
party or dismiss the incorrectly named party (even without prejudice), without
the necessity of this motion being filed.)

            Alternatively, Plaintiff must demonstrate that specific jurisdiction is appropriate.  In order to establish specific jurisdiction over a Defendant:

It must first be established that the defendant "purposefully established 'minimum
contacts' in the forum state []" by "conduct in connection with the forum
state . . . such that he [or she] should reasonably anticipate being hailed
into court there."  Burger King Corp. v. Rudzewicz, 471 U.S. 462, 474, 105 S. Ct. 2174, 2183, 85 L. Ed. 2d 528 (1985) (citing International Shoe Co. v. Washington, 326 U.S. 310,
316, 66 S. Ct. 154, 158, 90 L. Ed. 95 (1945), and World-wide Volkswagen Corp
v. Woodson
, 444 U.S. 286, 295, 100 S. Ct. 559, 566, 62 L. Ed. 2d 490
(1980)).  In determining whether an out-of-state defendant can "reasonably anticipate" being hailed into a foreign forum, due process requires  "'some act by which the defendant purposefully avail[ed] itself of the privilege of conducting activities within the forum state, thus invoking the benefits and protections of its laws.'"  Id., 471 U.S. at 475, 105 S. Ct.
at 2183 (quoting Hansen v. Denckla, 357 U.S. 235, 253, 78 S. Ct. 1228, 1240, 2 L. Ed. 2d
1283 (1958)).

 

Casentini v. District Court, 110Nev. 721, 877 P.2d 535, 539 (1994).

            In this case, Plaintiff's Complaint alleges that he retained an Illinois entity to
sell a car at a California auction, under an Agreement with an Illinois
forum selection clause.  Although Plaintiff references a 2008 meeting in Nevada,
the actual contracts being sued on were executed in 2010.  Accordingly, the first prerequisite for establishment of specific jurisdiction over these Moving Defendants is not met in this
case. 

            Likewise, the next two prerequisites, "that the cause of action arose out of or is connected to the acts purposefully engaged in by the defendant in the forum state," id.,
or that "the assertion of personal jurisdiction . . . comport with
[traditional notions of] 'fair play and substantial justice,'" (Id., citations
omitted) are likewise not met in this case. 
Neither the Mecum Defendants, nor the CHP Enterprises entity which
conducted the California auction (and has not yet been named as a Defendant)
nor the Ken Porter entity which was mistakenly named as a Defendant herein by
Plaintiff, have ever engaged in any activity "in the forum state," relating
to the subject transaction, and the assertion of personal jurisdiction by
Nevada over these Illinois and California residents for activities having to do
with a California auction would not comport with any notions of "fair play
and substantial justice" but would merely be a means to cause undue
expense and burden to these Defendants, including Defendants who are located in
California and Illinois, one of which Defendants included Illinois forum
selection clauses to avoid being hauled into court in Nevada.  Likewise, assuming the proper California entity is eventually named, that entity took
no actions directed toward the forum state (and the improperly named California
Defendant took no action at all that had anything to do with this case, inNevada or otherwise).

            It is overwhelmingly clear in this case that Nevada
has no grounds for asserting either specific or general jurisdiction over any
of the Movants.  Accordingly, this Nevada court lacks jurisdiction over Movants and the Plaintiffs’ Complaint, as against Movants, must be dismissed.

            In the present case, although there is one allegation that Dana Mecum visited the Plaintiff in Nevada, this visit apparently took place in 2008, whereas the transaction on which
Plaintiff is suing occurred in California in 2010, based on agreements which were not signed until 2010.  Accordingly, there is no basis for asserting that any visit by Dana Mecum to Henderson, Nevada in 2008, could form the basis for any specific
jurisdiction by the State of Nevada against Dana Mecum with respect to this matter, as that visit did not lead to the present controversy.  Moreover, Dana
Mecum, in his individual capacity, was not a party to either the contracts or
the transaction Plaintiff is suing over. 

The Plaintiff has presented no allegations in the Complaint indicating that Dana
Mecum, any of the Mecum entities, CHP Enterprises (not yet named) or Ken Porter
Auction Co. (inaccurately named) has done business in Nevada either generally
for purposes of general jurisdiction or with respect to the California auction
at issue in this litigation for purposes of specific jurisdiction.

            Even if the Plaintiffs were to
produce evidence that one or more of the Defendants listed in the Complaint has
ever done business in Nevada, that does not mean that the other Defendants can
be sued in this jurisdiction without the Plaintiff also producing evidence with
respect to each of the Defendants named by the Plaintiffs having engaged in
conduct based upon which Nevada can exercise jurisdiction over each such Defendant.  Thus, even if this court allows this matter
to proceed as to one or more of the Defendants, it must still be dismissed as
to any Defendant over whom Nevada
has no jurisdiction.

  1. B.                
    The Plaintiffs’ Suit Necessarily Invokes a Contract Which Contains a Forum Selection Clause
    and, as Such Must be Dismissed in Order to Uphold the Contract.

 

            The Plaintiffs’ lawsuit rests, in
part, upon an allegation that duties arose in favor of Plaintiffs and against
the Defendants as the result of the Entry Guideline Agreement referenced at
paragraph 26 of Plaintiffs’ Complaint and attached as Exhibit 5 to Plaintiffs’
Complaint.  The Entry Guideline
Agreement, as set forth above, specifically sets forth a forum selection clause
indicating that any action to be brought thereunder is to be brought inIllinois, and not inNevada.

            The Plaintiffs have not demonstrated
that they are entitled to selective enforcement of the agreements which form
the basis of their claims.  Plaintiffs
have no basis for alleging that certain paragraphs and obligations arising
under the agreements which form the basis of their claims must be enforced,
while other paragraphs can be ignored.

            As such, if the Plaintiffs’ action
is going to be given credence by this Court, then the Court must also dismiss the
case and require the Plaintiffs to refile in Illinois, on the basis of the forum selection
clause.

  1. C.               
    Even if the Court Were to Rule that Nevada had Jurisdiction Over any of the Moving Defendants, the Case Should Still be Transferred to a More Appropriate Venue on the Grounds
    of Forum Non Conveniens.

 

In Federal Court, the common law doctrine of forum non conveniens has been codified
as 28 U.S.C. § 1404(a) which indicates that a civil action may be transferred “[f]or
the convenience of parties and witnesses, in the interest of justice.”

In Federal Courts, a case may not be dismissed on grounds of forum non conveniens unless the alternative forum is located abroad.  Otherwise, Congress’s
codification of the doctrine “provided for transfer, rather than dismissal,
when a sister federal court is the more convenient place for trial of the
action.”  Sinochem International Co. Ltd. v. Malaysia International Shipping Corp. 549 U.S. 422, 127 S.Ct. 1184, 1190-91 (2007).

In the present matter, the auction took place in California
such that deposition testimony from any percipient witnesses will need to be
pursued in states other than Nevada.  None of the Defendants’ principals or
employees reside in Nevada, and the
co-Defendant, Ken Porter Auction Co., is a California entity, as is the entity that
Plaintiff should have named.  Moreover, any
judgment obtained against the Defendants in Nevada will ultimately need to be
localized in another state, such as Illinois, where the Mecum Defendants
reside, or California, where the correct Porter Defendant is located, once
named, in order to enforce the same, since Defendants have no assets in Nevada
and execution proceedings will therefore not be able to commence in Nevada in
any event.              Indeed, under NRS 21.270(b) these Defendants could not
even be required to sit for a judgment debtor's examination in Nevada since they are
not residents of any county in this state. 
  

Thus, it is difficult to conceive how any of the factors which are to be weighed in
determining whether to transfer a case under 28 USC § 1404 could possibly weigh
in favor of allowing this California auction case, with California and Illinois
Defendants, and an Illinois forum selection clause, to remain pending in
Nevada, and the case should be transferred to a more appropriate forum, such as
a U.S. District Court in Illinois or California. 

            Accordingly, even if the Court should rule that Nevada has jurisdiction over any one of the moving Defendants on technical grounds, the Court should still transfer this action under 28 USC § 1404 to a different District Court in another State.

            It should also be noted that, even
if the present Motion to Dismiss for Lack of Jurisdiction were denied as to one
or more of the Mecum Defendants, it could still be granted as to the Ken Porter
Defendant, or the correct entity doing business under that name once properly
named.  If this occurred it would make
more sense, in the present matter, to have the case adjudicated in a State such
as California, which is where the auction took place and where the witnesses
will thus be available, than in Nevada, especially if any of the Defendants
named or to be named by the Plaintiffs are not subject to jurisdiction in
Nevada in any event.  A forum where all
of the Defendants might be subject to jurisdiction (if such a forum exists)
would be more appropriate than having different suits proceed in different
districts.

III.       CONCLUSION

            Plaintiff has named a party, Ken Porter Auction Co., a California corporation,
which is not properly named and should be dismissed from this action, as it was
not involved in the facts or transactions at issue, as referenced in the
allegations of the Complaint, and also on the independent grounds that Nevada has no
jurisdiction over that entity.  Plaintiff has been informed of the correct entity holding the Ken Porter d/b/a for performing auctions, which was actually involved in the subject transaction,
and Plaintiff can name that entity in an appropriate venue.

            Even once Plaintiff names the proper party, CHP Enterprises, Inc., a California
corporation, d/b/a Ken Porter Auction, that entity will have grounds to dismiss
the Plaintiff’s Complaint for lack of jurisdiction if it is named in a suit
filed inNevada. 

Nevada also lacks jurisdiction over the Mecum Defendants. 

Therefore, the entirety of this action should be dismissed for lack of jurisdiction or transferred
to a different district on the grounds of forum non conveniens, under 28 U.S.C. §1404. 

Alternatively, if the Court believes that jurisdiction has been established over any of the
Defendants, and that transfer to another venue is not appropriate, the action
should nevertheless be dismissed at least with respect to any Defendants over
whom Nevada has no jurisdiction.

DATED
this_____ day of February, 2011.

                                                                        ALBRIGHT, STODDARD, WARNICK    

                                                                        &
ALBRIGHT

 

_____________________________________

D. CHRIS ALBRIGHT,
ESQ.   (4904)

801 S. Rancho Drive, Suite D-4

                                                              Las Vegas,NV 89106

                                                               Attorneys
for Defendants



CERTIFICATE
OF SERVICE

I
hereby certify that service of the foregoing MOTION TO DISMISS OF DEFENDANTS
was made this _____ day of February, 2011, pursuant to N.R.C.P. 5(b)
by depositing a copy of the same in the United
States mail in Las
  Vegas, Nevada,
postage prepaid, and addressed to:

 

Paul H. Schofield, Esq.

Schofield Miller Law Firm

8440
  W. Lake Mead Blvd, Suite 200

Las
  Vegas,
Nevada89128

Attorneys for Plaintiffs

 

 

About the Authors: The law firm of Albright, Stoddard, Warnick & Albright is an A-V Rated Nevada-based full-service law firm having attorneys licensed in Nevada, California and Utah. Our firm’s practice includes a strong emphasis on real estate, secured finance and litigation.

Note: This article, and any other information you obtain at this website, is not offered as legal advice, nor should it be relied upon as such, nor is it a solicitation for legal services. Only a licensed attorney can advise you with respect to your specific legal needs. We welcome your contacting our firm to discuss such representation. Contacting us does not create an attorney-client relationship. Please do not send any confidential information to us until such time as an attorney-client relationship has been established.

 

                         

Sample Form Motion to Strike Request for Trial De Novo in Clark County, Nevada

 

MSTDN

G. MARK ALBRIGHT, ESQ.

Nevada Bar No. 001394

WILLIAM H. STODDARD, JR.,
ESQ.

Nevada Bar No. 008679

ALBRIGHT,
STODDARD, WARNICK & ALBRIGHT

801 South Rancho Drive, Suite
D-4

Las Vegas, NV  89106

Tel:     (702)
384-7111

Fax:    (702)
384-0605

gma@albrightstoddard.com

bstoddard@albrightstoddard.com

Attorneys for Plaintiff/Counterdefendant

 

EIGHTH JUDICIAL DISTRICT COURT

CLARK COUNTY, NEVADA

 

HARSCH INVESTMENT PROPERTIES -
  NEVADA, LLC, an Oregon limited liability company, qualified to do business in
  Nevada,

 

                        Plaintiff/Counterdefendant,

vs.

 

JOHN ,

 

                        Defendant/Counterclaimant.

CASE NO.:     A-

DEPT. NO.:   

 

 

 

MOTION   TO STRIKE REQUEST FOR TRIAL DE NOVO

 

COMES NOW, Plaintiff/Counterdefendant, HARSCH
INVESTMENT PROPERTIES - NEVADA, LLC, an Oregon limited liability company,
qualified to do business in Nevada (hereinafter “Harsch”), by and through its
attorneys of record, ALBRIGHT, STODDARD, WARNICK & ALBRIGHT, and hereby
moves this court for an Order Striking the Request for Trial de Novo filed by
Defendant/Counterclaimant, JOHN (hereinafter 
“H”) as H failed to participate in the above entitled case in good
faith during the arbitration proceedings by failing to appear or participate at
all, and has therefore waived the right to request a trial de novo per NAR
22(A).



            DATED
this _____day of February, 2015.

 

ALBRIGHT, STODDARD, WARNICK & ALBRIGHT

 

 

 

By__________________________________________

G. MARK ALBRIGHT, ESQ., #001394

WILLIAM H. STODDARD, JR., ESQ., #008679

801 South Rancho Drive, Suite D-4

Las Vegas, Nevada 89106

Attorneys for Plaintiff/Counterclaim-defendant



 

 

NOTICE OF MOTION

 

TO:      ALL
INTERESTED PARTIES; and

TO:      ALL
COUNSEL OF RECORD

            PLEASE TAKE NOTICE that the
undersigned counsel will bring the above and foregoing MOTION TO STRIKE
REQUEST FOR TRIAL DE NOVO
on for hearing on the ______ day of
_______________, 2015, at the hour of _______ __.m., in Department XXVII, of
the above-entitled Court.

            DATED
this _____ day of February, 2015.

ALBRIGHT, STODDARD, WARNICK & ALBRIGHT

 

 

 

By__________________________________________

G. MARK ALBRIGHT, ESQ., #001394

WILLIAM H. STODDARD, JR., ESQ., #008679

801 South Rancho Drive, Suite D-4

Las Vegas, Nevada 89106

Attorneys for Plaintiff/Counterclaim-defendant

 

 

POINTS AND AUTHORITIES

 

I.    FACTS

 

            This is a simple landlord/tenant dispute. 
Harsch is suing H, a prior tenant, for unpaid rents and for fees
incurred during an eviction process which occurred when H failed to honor the
lease terms, and which process Defendant H, a licensed immigration attorney,
needlessly complicated and prolonged.  The Complaint in this matter was filed on December 24, 2013.  Defendant John H filed his Answer to the Complaint, including a counterclaim, on January 23, 2014, which Answer listed H’s address as Spring Mountain Road, Las Vegas, Nevada 89102, the
leasehold location from which H had been fighting eviction and which he
finally withdrew from only after the filing of his Answer and Counterclaim,
later in January 2014.  H apparently
never filed any notice with the court or the Arbitrator advising of his change
of address.  The matter was assigned to
the Court-Annexed Arbitration Program and an Arbitration Selection List was
sent to both parties in March 2014. 
Although this document was sent to H’s old address, due to his failure
to file a notice of any new address, H would have known, as an experienced
attorney, that the matter would be sent to Court Annexed Arbitration unless he
or the other side timely requested an exemption.  On April 15, 2014, Robert O. Kurth, Jr. was
assigned as the Arbitrator. 

            On July 2, 2014 the Arbitrator noticed an Early Arbitration Conference (see,
the Notice, attached as Exhibit “A” hereto), which was held on June 6,
2014.  Based on H’s office address having changed, Mark Albright, counsel for Plaintiff, sent a courtesy email regarding the Early Arbitration Conference to H at h.com. 
The memo stated as follows: “If this is still your email, please call
the arbitrator and notify his office (see contact information below) of your
new address and telephone number.  The
notice of EAC for tomorrow is attached hereto for your convenience.”  See, Email from Mark Albright, attached as Exhibit “B” hereto.  There was no response.  The email
was not returned as undelivered.  It is the same email address H placed on his pleadings and discovery responses.  The following day, June 6, 2014, the
Arbitrator could not reach H and H did not participate in the Early
Arbitration Conference.  Nor, despite
having filed not only an Answer but also a Counterclaim, and despite being
himself an attorney, did H apparently ever make any independent inquiries by
looking up the docket sheet of the case, or calling Plaintiff’s counsel or the
arbitrator, to learn of the case status. 
The Arbitrator then issued a Discovery Order (Exhibit “C”
hereto), and scheduled the Arbitration Hearing for September 11, 2014.

            Plaintiff’s counsel thereafter sent First Requests for Admissions to Defendant H, which
were mailed to his new law office location at 3355 Spring Mountain Road, on
July 11, 2014.  Thereafter, on August 8, 2014, Defendant H filed his Responses to Plaintiff’s First Requests for Admissions, demonstrating that this new location address was an accurate
address for H.

            Attorney H’s modus operandi in this proceeding and in the underlying eviction
proceeding has been to ignore letters, emails, and court hearings.  As set forth in the Plaintiff’s
Pre-Arbitration Hearing Statement, a copy of which is attached (without
exhibits) hereto as Exhibit “D,” this case arises out of a Master Lease
dated March 4, 2009 with H as tenant and Plaintiff as landlord, with rent
specified through March 2012.  The First
Amendment to Lease with a one year extension was dated February 23, 2002 with a
term to expire on March 31, 2013.  On January 18, 2013, a lease renewal proposal letter from Harsch’s landlord was sent to H as tenant, which set forth two different types of renewal
options.  Harsch never heard back from H
regarding either of the two alternative renewal options.  H completely ignored the lease proposal letter.  Thus, H was treated as on a month-to-month lease tenancy from March 31, 2013 until eviction proceedings started in late 2013.  A letter dated May
31, 2013 was sent from Harsch to H notifying him that his holdover rent would
be increasing pursuant to the terms of the lease.  H ignored the letter.  A 30-day Notice to Quit was served on October
31, 2013 to terminate H’s month-to-month tenancy.  H ignored the notice.  A Five Day Notice to Quit was served on H on
December 2, 2013.  H ignored the notice to quit

            A Complaint for Summary Eviction was filed on December 9, 2013.  On December 10, 2013, a Notice to Appear for Hearing was issued by the Justice Court and Judge Zimmerman.  The matter was heard by the Justice Court on December 17, 2013.  H did not appear.
 The following day, H filed a Motion to
Vacate the Eviction Order which had been issued following his
non-appearance.  On December 19, 2013, an
Order was entered denying the Motion to Vacate the Eviction Order.  H filed a Notice of Appeal on December 20,
2013 to the District Court.  The District
Court (Judge James Bixler) ordered an eviction. 
The Court’s Minute Order, attached hereto as Exhibit “E,” stated
that:



there is no signed lease at this time and the tenant
is in the property on a month to month basis. . . .   The Court does not find any error in the
ruling by Judge Zimmerman and informed Mr.  he has to move out of the
property.

 



H then filed a Writ of Certiorari to the Nevada Supreme Court on January 24, 2014. 
His Writ was summarily rejected and denied a week later on January 30,
2014, after he had finally vacated the premises the day before.  Such delay factors by  give a black eye to the legal profession among other business entitles who engage in business
transactions, such as leases, with attorneys who fail to abide by their
contractual obligations and then utilize delay actions (such as failing to
appear) and submitting frivolous filings to prevent the other party from
obtaining a remedy.

            H refused to participate meaningfully or properly in the instant rent collection
case when Mr. H rejected the notice to participate in the Early Arbitration
Conference and ignored the letter emailed to him by Albright on June 5, 2014
requesting that he participate.   The following day H again ignored the Early Arbitration Conference, as was his custom in the eviction proceeding.  He
subsequently also ignored all the telephone calls to his office and cell phone
reminding him that the arbitration hearing was starting.

            On September 9, 2014, Plaintiff’s Pre-Arbitration Hearing Statement was
hand-delivered by an employee of Albright, Stoddard, Warnick & Albright,
directly to the new local  office of  at Road.  Rule 7.26 of the rules of the Eighth Judicial District Court provide for service upon the attorney or party’s office with a clerk or other person in charge at the office.  The rule provides as follows:

      (b) Delivery of a copy with this rule means: (1) by handing it to the attorney or
to the party; or (2) by leaving it at the attorney’s or party’s office with a clerk or other person in charge thereof.

            Accordingly, since H is both the party and his own attorney, the Pre-Arbitration Brief was hand-delivered directly to H’s  office.  His  receptionist/clerk/secretary signed the Receipt of Copy, on September 9, 2014.  See, Exhibit “F” hereto, and indicated that they were expecting the Arbitration Brief.

            In addition, the Affidavit of Service (filed with the court on September 15, 2014
and attached as Exhibit “G”) indicates as follows:     

            On Tuesday, September 9, 2014, I was assigned to deliver the Plaintiff’s
Pre-Arbitration Hearing Statement to Defendant/Counterclaimant, J,
 (“Defendant”) and obtain a signature on the receipt of copy thereof. 

 

            I arrived at the office of Defendant at Road, Building , Suite, Las Vegas, Nevada 89103, shortly after 1:30 p.m. on September 9, 2014.   

            I entered the  office and asked the secretary if this was Mr. ’s office, to
which she replied “yes, I was expecting these documents” {i.e., the
Pre-Arbitration Hearing Statement}. 

 

            I then handed her a copy of Plaintiff’s Pre-Arbitration Hearing Statement and
asked her to please sign the Receipt of Copy on behalf of Defendant ,
which she did, a copy of which is attached hereto.



            The address to which the Pre-Arbitration Hearing Statement was delivered is the
same law office address listed on a variety of on-line websites for attorney
, including YellowPages.com, Yahoo.com, FindLaw.com, and Immigration
Lawyers in Las Vegas.  It is the same address where Plaintiff’s Requests for Admissions were mailed in July 2014, to which H responded, demonstrating the validity of that address.  It was confirmed as H’s new law office address by Albright, Stoddard’s employee, Stephan Hart.

            Despite the fact that both sides’ Pre-Hearing Arbitration Statements are almost always
due the same day under the Court Annexed Arbitration Program, such that the
delivery of this statement should have advised H that his own pre-arbitration
statement was also then due, H did not submit any Pre-Hearing Statement of his
own on that date or on any date thereafter. 
Furthermore, despite the fact that the submission of such statements
typically signify that a hearing is imminent (as the statement is typically to
be due within ten (10) days of the hearing under the Nevada Arbitration Rules,
but this time period is routinely extended by arbitrators to allow submissions
much closer to the hearing date).  Mr. H
also failed to pick up the phone to inquire of either Plaintiff’s counsel or
the Arbitrator identified on the Plaintiff’s submission, of the date or time of
the Arbitration hearing.

            On September 11, 2014, the Arbitration Hearing was held.  Both counsel for Plaintiff and the Arbitrator were in attendance and both called Mr. H at the beginning of the hearing to
ascertain why H was not present and left messages with H (on both his office
and also on his cell phone) that the Arbitrator was starting the arbitration
hearing.  H ignored these various calls
and made no appearance at the hearing. 

            Moreover, after the hearing concluded, H still did not place a return call to either
Plaintiff’s counsel or the Arbitrator, to explain his absence at the hearing,
to request relief for that absence, or to inquire as to what occurred at the
hearing!  Significantly, although the Arbitrator waited much longer than the NAR deadlines to finally issue an Arbitrator’s Award, giving H several extra weeks to place such a return phone call, H did not ever do so, but, instead, continued to completely ignore this matter for
several months, despite having been served with a Pre-Hearing Statement, and
received phone calls about the hearing in September.  A reasonable attorney would have participated in the Early Arbitration Conference or called the Arbitrator immediately
afterwards to explain his absence.  H’s
behavior here and during the underlying eviction process is to try and delay
and draw out the proceedings to force the Plaintiff to incur unnecessary
attorneys’ fees.

            At the hearing, Plaintiff Harsch presented three witnesses.. The Arbitrator
subsequently issued his Arbitration Decision and his Arbitration Award, in
favor of Plaintiff and against H, on December 23, 2014, over three months after
the hearing, during which time period H’s silence and inactivity
continued.  A true and correct copy of
the Arbitration Decision  is attached as Exhibit
“H”
hereto.   A copy of the Award is
attached hereto as Exhibit “I” hereto. 
In his Arbitration Decision, the Arbitrator expressly included the
following ruling: 

 

The Arbitrator further finds that H did not attend
the Early Arbitration Conference and a Discovery Order along with a Notice to
Appear for Arbitration Hearing was provided to H.  Notwithstanding, H never contacted or
communicated with the Arbitrator or his office directly; did not provide a
pre-hearing statement or brief, and did not submit any evidence in the
arbitration proceeding or at the Arbitration Hearing; and subsequently, did not
participate in good faith at the arbitration proceeding.  Further, the Arbitrator attempted to contact
H prior to the Arbitration Hearing to no avail
.  Further, both the Arbitrator and the
Defendant’s counsel were unable to contact the Defendant H at the telephone
numbers provided.  (Emphasis added.)

On January 20, 2015, H filed his Request for Trial de
Novo.  Said request should be stricken.

II.  LEGAL
POINTS AND AUTHORITIES

            Nevada Arbitration Rule 22(A) states as follows:

 

The failure of a party or an attorney to either prosecute or defend a case in good faith during the arbitration proceedings
shall constitute a waiver of the right to a trial de novo.

            In
this case, it is obvious that on June 5, 2014 (when H received an email from
Albright, Stoddard), Defendant H was well aware of the name of the Arbitrator,
and knew his office address and knew his phone number.  On July 11, 2014, when the Plaintiff’s
Requests for Admissions, a copy of which are attached hereto as Exhibit “J”,
(which showed the name of the Arbitrator in the Certificate of Service attached
thereto) were served on H, H knew the Plaintiff’s attorneys’ addresses,
emails, and phone numbers (which were the same as on the Complaint, and also in
the underlying case), and yet did nothing to contact either the Arbitrator or
Plaintiff’s counsel after serving his responses to the Requests for Admissions
on August 8, 2014.  Indeed, there was no
communication or contact whatsoever by H between August 8, 2014 and January
20, 2015 when the Request for Trial de Novo was filed by H.  In other words, H completely disappeared
from this case and showed no interest therein for six months (in itself longer
than the amount of time which is itself the maximum period allotted from the
date of appointment of an Arbitrator, until an arbitration hearing must be
held)!  This delaying tactic forced
Plaintiff to incur substantial fees preparing for and attending an arbitration
hearing with three witnesses, and now H wants to continue to force the
Plaintiff to incur fees and costs on a simple rent collection case.

            Plaintiff
served its Pre-Arbitration Statement on September 9, 2014 by serving H’s law
office directly through a receipt of copy signed by his receptionist in his law
office lobby, at his new local Nevada office. 
In other words, the Defendant John , an with a
Las Vegas, Nevada office, who is familiar with the litigation (being the party
hereto, who hotly contested the underlying eviction process), completely and
deliberately ignored this case from August 8, 2014 until January 20, 2015, a period
of almost six (6) months without sending a single inquiry, phone call, letter,
email, or other communication to the Arbitrator or the Plaintiff’s counsel to
determine the status of these proceedings, or to participate in these
proceedings.

            It is abundantly evident that even though the Defendant was well aware of the ongoing
discovery, and that the case was in the arbitration program, he intentionally
refused to make any inquiry (no phone calls or emails) whatsoever, including in
response to emails and phone messages sent to him, until he was served with the
Arbitration Award and Arbitration Decision on December 23, 2014, and then
elected to file his request for trial de novo on  January 20, 2015, six (6) months after his
last appearance in these proceedings. 
H’s actions make light of the court annexed arbitration program and
should not be countenanced.  This is
particularly evident where Mr. H’s secretary indicated they had been expecting
the Pre-Arbitration Brief.

            The purpose of penalty provisions in court-annexed arbitration programs is to
dissuade litigants from ignoring or abandoning the arbitration process and then
seeking a trial de novo after the process has concluded.  Hence, the rule allows the court to strike a
request for trial de novo where a party or an attorney fails “to either
prosecute or defend a case in good faith during the arbitration
proceedings.”  NAR 22(A).  As a matter of law, H’s actions have not
been in good faith.  To allow H’s
behavior would undermine the entire Court Annexed Arbitration Program.  To hold otherwise would destroy all incentive
for parties to participate in the arbitration program.

            When there has been no participation at all by a defendant in an arbitration,
striking the de novo request is appropriate.  In the case of New England Merchants Nat.
Bank vs. Hughes
, 556 F.Supp. 712 (E.D. Pa. 1983), the court approved the
denial of the demand for trial de novo by a party who refused to
participate in the arbitration proceedings at all under a similar rule.  The Court explained that “the goals of the
arbitration program and the authority of this court would be seriously
undermined if a defendant were permitted to refuse to attend an arbitration
hearing and then demand trial de novo.” 
Id. at 715. 

            The Nevada Supreme Court in Gittings vs. Hartz, 116 Nev. 386, 996 P.2 898
(Nev. 2000),  held that for purposes of
requesting a trial de novo “this court has equated good faith with
meaningful participation in the arbitration proceedings.”  For example, in Casino Properties vs.
Andrews
, 112 Nev. 132, 911 P.2d 1181 (Nev. 1996), the Nevada Supreme Court
explained that:

 

the purposes of Nevada’s Court Annexed Arbitration Program are to provide a simplified procedure for obtaining a prompt and equitable resolution of certain civil matters. 
NAR 2(a).  In Gilling vs.
Eastern Airlines, Inc
., 680 F.Supp. 169 (DNJ 1988), a federal court dealing
with the issue of good faith participation in arbitration, equated good faith
with meaningful participation and determined that if the parties did not
participate in a meaningful manner, the purposes of mandatory arbitration would
be compromised.  We agree with this
proposition and conclude that appellants did not defend the case in good faith
during the arbitration proceeding because they did not participate in a
meaningful manner.

            The very purpose of penalty provisions in court annexed arbitration programs “is to
dissuade litigants from actually seeking a trial de novo.  Without penalty provisions, litigants would have little incentive to take court-annexed arbitration programs
seriously.”  See, Court Annexed Arbitration Programs, Nevada Law Journal, 11 Nev L.J. 282 (fall 2010).

            There is a narrow exception recognized in Nevada for car accident cases where
liability is clear and a party does attend and participate in good faith in the
arbitration hearing – in such narrow circumstances, the courts occasionally
excuse the actual party from attending, so long as his attorney attends and
participates in the arbitration hearing.

            For example, the Nevada Supreme Court in Gittings v. Hartz, 116 Nev. 386,
996 P.2d 898 (Nev. 2000) upheld a request for trial de novo and ruled that a
motion to strike was improperly granted, even though the defendant had not
personally appeared at the hearing.  However, in doing so, the court identified multiple key factors which distinguish Gittings from this situation (where H – who is both the
party and his own counsel – failed to participate in any discovery, in any
briefing, or to appear in person or through counsel at the
arbitration hearing).  Specifically in Gittings, the key differences noted are as follows: Gittings was represented by counsel.  Gittings’ attorney did appear at the arbitration hearing. 
Gittings had participated in discovery and had served interrogatories
and a request for production of documents on Hartz.  Gittings also took the deposition of Plaintiff
Hartz.  Moreover, Gittings’ attorney did appear at the arbitration hearing and conducted cross-examination and presented arguments during the arbitration hearing. 
Gittings conducted depositions and discovery as authorized and in
addition prepared and submitted an arbitration brief to the arbitrator.  Additionally, one of the key distinguishing factors between this case and the Gittings case is that in Gittings
the court relied upon the statistics compiled by the office of the District
Court Discovery Commissioner outlining the percentage of cases in which
Allstate Insurance Co. had requested a trial de novo.

            In Gittings,  the Supreme Court allowed the trial de novo to move forward because Gittings had participated in good faith in all forms of discovery permitted by the
arbitrator, had prepared an arbitration brief, and had appeared through counsel
at the arbitration hearing itself where defendant’s counsel conducted
cross-examination of witnesses.  An
additional key difference is that Gittings explained that she did not need to
personally attend the arbitration hearing itself because liability was not
an issue
.  She had run through a red
light and struck the passenger side of Plaintiff Hartz’s vehicle.  The impact was significant enough to shatter the windows and bend the frame of Hartz’s vehicle. 
Both vehicles were deemed total losses.  The Nevada Supreme Court agreed that under these unique circumstances, it was not necessary for the defendant to personally attend the arbitration hearing, as long as her lawyer did so, because liability was not an issue, only
damages, and since defense counsel was present to participate in the
arbitration, such that no bad faith existed. 
The court held that Gittings’ decision not to contest liability at the
hearing or to seek independent medical examination through experts was
insufficient grounds to completely strike the demand for a trial de novo under
these circumstances.

            Likewise, in Chamberland vs. Labarbera, 110 Nev. 701, 877 P.2d 523 (Nev. 1994),
the Nevada Supreme Court also held, that in a car accident case with liability
not at issue, and the entire dispute involving solely damages arising from the
car accident, striking the trial de novo was not appropriate in that case where
at least defense counsel, if not his client, was present at the arbitration
hearing and did participate and conducted cross-examination and disputed the
estimated damages. 

            In other words, there appears to be a minor exception to the general rule that a
party must appear at the arbitration hearing, for car accident cases where
liability is clear and only damages are being contested, and where at least
defense counsel does appear.  In that rare instance, the court has
allowed a trial de novo to move forward where the defendant’s attorney
participated in the discovery and in the arbitration hearing itself, even
though the defendant was not personally present at the hearing. 

Here that narrow exception (carved out by two car
accident cases) is not applicable.  This is not a case where Defendant H
participated in the arbitration hearing through his assigned attorney and
presented a defense and cross-examined witnesses.  Mr. H ignored the
hearing altogether, ignored the notice to attend an Early Arbitration
Conference, ignored the notice to attend an Arbitration hearing, ignored the
rule for submission of an Arbitration Brief, even though the other side’s brief
was served on his secretary in his Las Vegas law office (which by Nevada
Arbitration Rules and practice demonstrated that an Arbitration hearing was
days away), and ignored the telephone calls and messages that were left on his
office and cell phone that the arbitration hearing was starting. Then, he
continued to fail to lift a finger for another several months, apparently intentionally
and deliberately indicating that he would not even attempt to salvage or remedy
his failure to participate in the process, but would simply file a trial de
novo request instead, treating everything that had previously occurred, and the
costs and fees that others had expended to properly participate under the
rules, with complete contempt.  Moreover,
this is a simple rent collection case, not a personal injury case where damages
are contested.          

III.  CONCLUSION

            Based upon all of the foregoing, it is abundantly evident that H knew of the
arbitration proceedings as early as July 2014 (when he received and responded
to discovery requests that were also sent to the arbitrator, Robert Kurth).1  Mr. H never responded or made an appearance
from August 8, 2014 until January 20, 2015 when he filed his Request for Trial
de Novo.  Mr. H has not participated in
the underlying arbitration proceedings in good faith or in any meaningful
manner.  Consequently, his Request for
Trial de Novo should be summarily stricken and the court should uphold the
Decision entered by the Arbitrator after a full hearing on the merits with
three witnesses in attendance and testifying for the Plaintiff, Harsch
Properties.  The goals of the arbitration
program and the authority of this court would be seriously undermined if a
defendant were permitted to refuse to attend an arbitration hearing and then
simply demand a trial de novo. This is particularly true here, where an
attorney is the defendant and has a history of ignoring eviction and rent
collection procedures.  To allow an
attorney, representing himself in proper person, to ignore the court annexed
arbitration program would eviscerate the public policies supporting that
program. The fact that the brief and other documents were served on his law
office secretary rather than him personally is totally irrelevant under the
court’s local rules.

            DATED
this _____day of February, 2015.

ALBRIGHT, STODDARD, WARNICK & ALBRIGHT

 

 

 

By__________________________________________

G. MARK ALBRIGHT, ESQ., #001394

WILLIAM H. STODDARD, JR., ESQ., #008679

801 South Rancho Drive, Suite D-4

Las Vegas, Nevada 89106

Attorneys for Plaintiff/Counterclaim-defendant

 

CERTIFICATE OF SERVICE

            Pursuant
to NRCP 5(b), I certify that on this _____ day of February, 2015, I deposited a
true and correct copy of the foregoing MOTION TO STRIKE REQUEST FOR TRIAL DE
NOVO
for mailing in the U.S. Mail at Las Vegas, Nevada, in a sealed
envelope upon which first class postage was prepaid and addressed to:

 

 

            Defendant/Counterclaimant

 

 

Las Vegas, Nevada 
89103

            Defendant/Counterclaimant

 



11It
should be noted that stapled to the back of H’s Responses to Requests for
Admissions was a two sentence document entitled “Notice of Erroneous Service,”
requesting that future pleadings be mailed to a California residence address.  However, this document was NOT filed with the court and, since it was stapled to H’s discovery responses, was not noticed by Plaintiff’s staff or apparently by the Arbitrator. However, LR 7.26
allows service on a party at his business.

 

About the Authors: The law firm of Albright, Stoddard, Warnick & Albright is an A-V Rated Nevada-based full-service law firm having attorneys licensed in Nevada, California and Utah. Our firm’s practice includes a strong emphasis on real estate, secured finance and litigation.

Note: This article, and any other information you obtain at this website, is not offered as legal advice, nor should it be relied upon as such, nor is it a solicitation for legal services. Only a licensed attorney can advise you with respect to your specific legal needs. We welcome your contacting our firm to discuss such representation. Contacting us does not create an attorney-client relationship. Please do not send any confidential information to us until such time as an attorney-client relationship has been established.

Penalty Provisions in Nevada's Court Annexted Arbitration Program

 

The purpose of penalty provisions in Nevada's court-annexed
arbitration programs is to dissuade litigants from ignoring or abandoning the
arbitration process and then seeking a trial de novo after the process
has concluded.  Hence, the rule allows the court to strike a request for trial de novo where a party or attorney fails “to either prosecute or defend a case in good faith during the
arbitration proceedings.”  NAR 22(A).  As a matter of law, H’s actions
have not been in good faith.  To allow H’s behavior would undermine the entire arbitration program.  To hold otherwise would destroy all incentive to participate in the court-annexed program.

When there has been no participation at all by a defendant in an arbitration,
striking the de novo request is appropriate.  In the case of New England Merchants Nat.
Bank vs. Hughes
, 556 F.Supp. 712 (E.D. Pa. 1983), the court approved the
denial of the demand for trial de novo by a party who refused to
participate in the arbitration proceedings at all under a similar rule.  The Court explained that “the goals of the arbitration program and the authority of this court would be seriously
undermined if a defendant were permitted to refuse to attend an arbitration
hearing and then demand trial de novo.”  Id. at 715. 

The Nevada Supreme Court in Gittings vs. Hartz [citation needed],
held that for purposes of requesting a trial de novo “this court has
equated good faith with meaningful participation in the arbitration
proceedings.”  For example, in Casino Properties vs. Andrews, 112 Nev. 132, 911 P.2d 1181 (Nev. 1996), the Nevada Supreme Court explained that:

"the purposes of Nevada’s Court Annexed Arbitration
Program are to provide a simplified procedure for obtaining a prompt and
equitable resolution of certain civil matters.  NAR 2(a).  In Gilling vs.
Eastern Airlines, Inc
., 680 F.Supp. 169 (DNJ 1988), a federal court dealing
with the issue of good faith participation in arbitration, equated good faith
with meaningful participation and determined that if the parties did not
participate in a meaningful manner, the purposes of mandatory arbitration would
be compromised.  We agree with this
proposition and conclude that appellants did not defend the case in good faith
during the arbitration proceeding because they did not participate in a
meaningful manner."

The very purpose of penalty provisions in court annexed arbitration programs “is to
dissuade litigants from actually seeking a trial de novo.  Without penalty provisions, litigants would have little incentive to take court-annexed arbitration programs
seriously.”  See, Court Annexed Arbitration Programs, Nevada Law Journal, 11 Nev L.J. 282 (fall 2010).

There is a narrow exception recognized in Nevada for car accident cases where
liability is clear and defense counsel does attend and participate in good
faith in the arbitration hearing – in such narrow circumstances, the courts
occasionally excuse the actual defendant from attending, so long as his
attorney attends and participates in the arbitration hearing.

The Nevada Supreme Court in Gittings v. Hartz, 116 Nev. 386, 996 P.2d 898
(Nev. 2000) upheld a request for trial de novo and ruled that a motion to
strike was improperly granted, even though the plaintiff had not appeared at
the hearing.  However, in doing so, the court identified multiple key factors which distinguish Gittings from this situation, (where H failed to participate in any discovery, in any
briefing, or to appear in person or through counsel at the arbitration hearing
itself).  Specifically in Gittings, the key differences noted are as follows: Gittings was represented by counsel.  Gittings’ attorney did appear at the arbitration hearing. 
Gittings had participated in discovery and had served interrogatories
and a request for production of documents on Hartz.  Gittings also took the deposition of
Plaintiff Hartz.  Moreover, Gittings’ attorney did appear at the arbitration hearing and conducted cross-examination and presented arguments during the arbitration hearing.  Gittings conducted depositions and discovery as authorized and in addition prepared and submitted an arbitration brief to the arbitrator.  Additionally, one of the key distinguishing factors between this case and the Gittings case is that in Gittings the court relied upon the statistics compiled by the
office of the District Court Discovery Commissioner outlining the percentage of
cases in which Allstate Insurance Co. had requested a trial de novo.

In Gittings, the Supreme Court allowed the trial de novo to move forward because Gittings
had participated in good faith in all forms of discovery permitted by the
arbitrator, had prepared an arbitration brief, and had appeared through counsel
at the arbitration hearing itself where defendant’s counsel conducted
cross-examination of witnesses.  An additional key difference is that Gittings explained that she did not need to personally attend the arbitration hearing itself because liability was not
an issue
.  She had run through a red light and struck the passenger side of Plaintiff Hartz’s vehicle.  The impact was significant enough to shatter the windows and bend the frame of Hartz’s vehicle.  Both vehicles were deemed total losses.  The Nevada Supreme Court agreed that under these unique circumstances, it was not necessary for the defendant to
personally attend the arbitration hearing, as long as her lawyer did so,
because liability was not an issue, only damages, and since defense counsel was
present to participate in the arbitration, no bad faith existed.  The court held that Gittings’ decision not to contest liability at the hearing or to seek independent medical examination
through experts were insufficient grounds to completely strike the demand for a
trial de novo under these circumstances.

Likewise, in Chamberland vs. Labarbera, 110 Nev. 701, 877 P.2d 523 (Nev. 1994),
the Nevada Supreme Court also held, that in a car accident case with liability
not at issue, and the entire dispute involving solely damages arising from the
car accident, striking the trial de novo was not appropriate in that case where
defense counsel was present at the arbitration hearing and did participate and
conducted cross-examination and disputed the estimated damages. 

 In other words, there appears to be a minor exception to the general rule that a
party must appear at the arbitration hearing, for car accident cases where
liability is clear and only damages are being contested, and where defense
counsel does appear.  In that rare instance, the court has allowed
a trial de novo to move forward where the defendant’s attorney participated in
the discovery and in the arbitration hearing itself, even though the defendant
was not personally present at the hearing. 

Here that narrow exception is not applicable.  This is not a case where
Defendant H participated in the arbitration hearing through his assigned
attorney and presented a defense and cross examined witnesses.  Mr. H
ignored the hearing altogether, ignored the notice to attend an EAC, notice to
attend an Arbitration Hearing, the Arbitration Brief that was served on his
secretary in his Las Vegas law office (which by local rule demonstrated that an
Arbitration Hearing was days away), and ignored the telephone calls and
messages that were left on his office and cell phone that the arbitration
hearing was starting. 

III.  CONCLUSION

Based upon all of the foregoing, it is abundantly evident that H knew of the
arbitration proceedings as early as July 2014 (when he received and responded
to discovery requests that were also sent to the arbitrator, Robert Kurth).1  Mr. H never responded or made an appearance from August 8, 2014 until January 20, 2015 when he filed his Request for Trial de Novo.  Mr. H has not participated in the underlying arbitration proceedings in good faith or in any meaningful manner.  Consequently, his Request for
Trial de Novo should be summarily stricken and the court should uphold the
Decision entered by the Arbitrator after a full hearing on the merits with
three witnesses in attendance and testifying for the Plaintiff, Harsch Properties.  The goals of the arbitration program and the authority of this court would be seriously undermined if a defendant were permitted to refuse to attend an arbitration hearing and then simply demand a
trial de novo. This is particularly true here, where an attorney is the
defendant and has a history of ignoring eviction and rent collection
procedures.  To allow an attorney, representing himself in proper person, to ignore the court annexed arbitration process would eviscerate the public policies supporting the court-annexed
arbitration program.

            DATED
this _____day of February, 2015.

 

ALBRIGHT, STODDARD, WARNICK & ALBRIGHT

Mark Albright

 



11It should be noted that stapled to the back of H’s Responses to Requests for
Admissions was a two sentence document entitled “Notice of Erroneous Service,”
requesting that future pleadings be mailed to a California residence
address.  However, this document was NOT filed with the court and, since it was stapled to H’s discovery responses, was not noticed by Plaintiff’s staff or apparently by the Arbitrator. However, LR 7.26 allows service on a party at his business.

 

About the Authors: The law firm of Albright, Stoddard, Warnick & Albright is an A-V Rated Nevada-based full-service law firm having attorneys licensed in Nevada, California and Utah. Our firm’s practice includes a strong emphasis on litigation and dispute resolution, including representing clients in all forms of alternative dispute resolution and serving as mediators in private dispute resolutions for third parties.

Note: This article, and any other information you obtain at this website, is not offered as legal advice, nor should it be relied upon as such, nor is it a solicitation for legal services. Only a licensed attorney can advise you with respect to your specific legal needs. We welcome your contacting our firm to discuss such representation. Contacting us does not create an attorney-client relationship. Please do not send any confidential information to us until such time as an attorney-client relationship has been established.

Nevada Cease and Desist Letter Under Noncompete Clause Citing Camco Decision

 

This letter is written on behalf of NE LLC (“Ne” or your “Former Employer”), with
respect to that certain At Will Employment Agreement (“Employment Agreement”)
which you executed with your Former Employer on or about July 21, 2014, and
also with respect to that certain Severance Agreement (the “Severance
Agreement”) which you executed with NE on or about November 18, 2014.

The Severance Agreement included the following provisions, which not only
acknowledged certain of your existing obligations to NE under the Employment
Agreement, but which also restated those obligations as new and separate
promises made by you, and detrimentally relied upon by NE in entering into the
Severance Agreement with you:

Employee acknowledges and agrees that the Written Employment Agreement contains certain Non-competition provisions which are binding during employment, certain
non-solicitation of Employer Client provisions which survive termination of
employment and remain effective for 12 months following the termination of
employment
and certain non-solicitation of Employer employees provisions
which survive and remain effective for two years after termination of
employment (all of which dates shall be deemed to begin to run, hereunder, no earlier than January 1, 2015) and certain provisions regarding confidential information, Trade Secrets and ownership of inventions which survive termination of employment for an
unlimited period of time, together with other provisions which survive
termination of employment, and Employee expressly agrees to continue to abide by all of said terms of the Written Employment Agreement pursuant to the terms thereof including during the remainder of his employment, and thereafter.  Employee also expressly agrees
that he shall not be entitled to solicit the business of any client or customer
of Employer, on his own behalf or on behalf of any other person or entity,
unless he receives the express written permission of Employer, executed by JG,
prior to initiating any action whatsoever to do so, for a period of one (1)
year after December 31, 2014
. Severance Agreement at ¶8 [emphasis added].

The non-solicitation obligations you agreed to, with respect to existing NE
clients, are fully enforceable under Nevada law.  Indeed, a much broader restriction against
any post-employment competition for a certain time period, would be enforceable
in this State.  Camco, Inc. v. Baker, 936 P.2d 829 (Nev. 1997).  Hence, NE acted in reasonable good faith in seeking only a less restrictive covenant from you, solely as to the
solicitation of its existing customers.

In violation of these terms, on January 5, 2015, you reached out to MP, an officer
of PLA (hereinafter the “Pla”), the entity which operates the Pla Hotel, an
existing customer of NE, on behalf of a company known as SK, with the intent to
arrange a meeting between principals of the Pla and SK, and with the further
intent of selling SK products and services to the Pla, including products
identified in your communication and described in advertising material for said
products attached thereto.  SK provides products and services which compete directly with the products and services provided by NE, including managed information technology (“IT”) services.  You engaged in this conduct in violation of the surviving provisions of your Employment Agreement, and without the prior permission of JG, as required in your Severance Agreement.

This conduct on your part was a breach of the promises you agreed upon in executing
those agreements.  Based thereon, this letter is written to demand that you immediately cease and desist from taking any further action in violation of your obligations to NE under those
agreements.  For example, you are to immediately cease any further communications with the Pla, or any agent or employee thereof, on behalf of Ska, or on behalf of any other entity which
provides any IT products or services, including any such products or services
which compete with those offered by NE, such as cloud computing, offsite server
hosting, managed services, IT troubleshooting and repair, etc.  We also hereby demand that you immediately inform Ska, or any other person or entity on whose behalf you are performing
any services, either independently or as a full time in-house employee, of your
obligations to NE.

Your intentional actions are in direct violation of NE’s rights and give rise to
numerous and substantial claims against you personally.  Indeed, intentionally interfering with your Former Employer’s business and willfully competing with its customers in a
manner maliciously calculated to cause it economic harm, would potentially be
actionable even without the breaches of contract involved in this case.  These actions give rise to numerous claims, including, but not limited to:  (i) fraud, (ii) intentional interference with prospective economic advantage, (iii) intentional interference with contractual relations, (iv) breach of contract, (v) breach of the implied covenant of good faith and fair dealing, (vi)
injunctive relief; and (vii) punitive damages.

Without waiving any of its rights in law or equity, all of which it expressly reserves,
NetEffect hereby demands that you:

(1)          
Immediately cease all contact with NE customers;

(2)              
Within twenty-four (24) hours from the date of this letter provide a list of all NE
customers you have contacted, and any and all products or services you have
arranged to be provided to such customers, and any and all emails, texts,
written communications, bids, proposals, or invoices you have submitted to such
customers;

(3)              
Within three (3) business days from the date of this letter turn over all proceeds you
have gained from your activities, together with any severance payments you
received during December 2014 in bad faith; and

(4)              
Within twenty-four (24) hours from the date of this letter, confirm in writing that
you have ceased and will not resume contact with your Former Employer’s
customers.

(5)              
Unless it receives immediate written confirmation that you will comply with the
above demands, NE will be forced to assume that you do not intend to
voluntarily take the necessary actions outlined above.  In that event, NE reserves the right to
pursue all of its available legal and equitable remedies in the appropriate
forum, including via the commencement of formal legal action against you without
further notice

(6)              
Because your promises to NE were utilized to induce NE to promise to pay you certain
severance moneys, including moneys which would otherwise remain due and owing
hereafter, and because those obligations on the part of NE were contingent and
conditioned on your remaining in compliance under the Severance Agreement, any
moneys due and owing to you from NE as and for post-employment pay, are hereby
subject to being forfeited, unless and until this matter is timely resolved in
a manner fully satisfactory to NE.  You should also be aware that, in the event NE is required to seek injunctive relief against any ongoing breaches by you of the non-solicitation provisions
of the Employment Agreement or Severance Agreement, that it will be seeking its
costs and attorneys’ fees from you for being required to engage in any such
litigation.  Please immediately respond to the undersigned (or have your counsel so respond), so that a determination may be made with respect to whether this matter can be resolved in a manner which prevents such adverse outcomes. 

(7)              
This letter is not intended and should not be treated as a full statement of the
facts or of the applicable law, an admission of any fact, or a waiver or
limitation of any of NE’s rights or remedies, all of which are specifically
retained and reserved.

Thank you for your attention to the foregoing.

 

Very truly yours,

 

ALBRIGHT, STODDARD, WARNICK & ALBRIGHT

About the Authors: The law firm of Albright, Stoddard, Warnick & Albright is an A-V Rated Nevada-based full-service law firm having attorneys licensed in Nevada, California and Utah.  Our firm’s practice includes a strong emphasis on construction law, contracts and litigation in the jurisdictions where we are licensed.

Note: This article, and any other information you obtain at this website, is not offered as legal advice, nor should it be relied upon as such, nor is it a solicitation for legal services.  Only a licensed attorney can advise you with respect to your specific legal needs. We welcome your contacting our firm to discuss such representation.  Contacting us does not create an attorney-client relationship. Please do not send any confidential information to us until such time as an attorney-client relationship has been established.

Tips for Driving in the Rain in Las Vegas, Nevada

 

Doc3

143 wrecks reported in 10 hours because of rain, Jan. 12, 2015, Las Vegas Review Journal

Rain has been the cause of thousands of car accidents year in and year out, and rain is especially dangerous in dry weather states Nevada.. Our Las Vegas personal injury attorneys know that some of the most heavily populated areas in Southern Nevada — especially Clark County— only have rain periodically during the year, (less than 4 inches per year)  and many people forget how to drive in it. Therefore, drivers need to understand exactly how rain can contribute to accidents.  For example, just yesterday the Las Vegas metro area experienced over 140 accidents in just a single day in the midst of a lengthy rain storm.

A Lot of Drivers Don’t Know How to Drive in the Rain

In bad weather conditions, there are two types of drivers who can significantly increase the risk to others: excessively timid drivers and reckless drivers.

Excessively timid drivers tend to overestimate the danger of weather conditions and drive at unreasonably low speeds. When the weather limits the number of available traffic lanes, such as can happen following heavy rain, this type of driver can cause traffic to back up, increasing the risk of a rear end accident, particularly on I-15 and our Las Vegas beltway, I-215.

Reckless drivers often ignore the consequences of bad weather and may even think it is a good thing that the weather has forced a lot of other drivers off of the road. Reckless drivers may well drive at full highway speed or greater, even when visibility is low or the roads are drenched. Even with four wheel drive (4WD), cars can still skid. When they lose control on a slippery road, their high speed makes it much more likely for a serious car accident to occur.

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Rain Makes the Road Slippery

Rain can make it more difficult to stay on a roadway, to stop, or to avoid colliding with other vehicles. This is especially true when it first starts raining because Las Vegas roads are their most slippery at the beginning of a rainstorm. This is when dust, oil and grime mix with the water making a slippery roadway surface.  When the road first gets wet, oil rises to the surface and creates a greasy surface. If you can’t stop your car in time, that’s when accidents happen. Often the roads are safer after the rain has washed away the greasy surface.

Rain Decreases Visibility

During rain storms, it can be difficult for drivers to see to see other cars. When rain is combined with dirty water kicked up from the road by other drivers, windshields can quickly become dirty. That is why it is always important to make sure that your car has functional windshield wipers.

Tips for Driving in Rainy Weather

Car and truck accidents become significantly more common during periods of inclement weather. With the transition from fall to winter weather in the arid west, driving conditions can change suddenly, requiring extra caution on the road. Our experienced personal injury litigators at Albright Stoddard focus our vehicle accident practice on obtaining compensation for injured motorists, passengers and pedestrians. Mindful of the importance of accident avoidance, we offer these reminders to help you prepare for the weather ahead and stay safe on the road.

Regularly check your wipers. Windshield wiper blades should be replaced at least once a year to make sure they stay in good conditions. If your wipers are not effectively cleaning your windshield or leaving streaks behind them, it’s time to get replacements.

Check your tires. Tires should be in good condition, having an appropriate amount of tread and no bald spots. They should also have the proper amount of air pressure.

Use your headlights. When it begins to rain, visibility can quickly start to suffer on the road. Make sure you have your headlights on so that other people on the road can more easily see you.

Watch your speed. Refrain from speeding when it’s raining.

- Apply the brakes when you go into a curve, and if you happen to skid, stay calm and get off the gas, steering in the direction you want to go.

- Hydroplaning can occur when your vehicle rides on top of the water, often at speed no greater than 40 mph.

- Check your tire tread. Bald tires may feel fine on dry roads but they become unsafe in heavy rain or snow.

- According to the National Safety Council, each year, 75 percent of weather-related vehicle crashes occur on wet pavement and 47 percent happen during rainfall.

Leave plenty of space in front of you. When driving on the freeway, leave more space between you and the other cars, since stopping distance time is, on the average, twice as long in the rain.

These are just a few of the facts to keep in mind as the weather becomes more severe in Nevada.

Car Accident Prevention Tips For the Rain in Nevada

1. Drive slower.

This is an obvious but important tip, as it allows for better reaction times. Rainwater causes grease and oil built up on the road to surface and tires traction suffers as a result. If you drive slower, your tire traction will improve and you will also have more time to brake.

2. Keep your eyes on the car ahead of you.

In the rain, it’s often hard to see very far ahead of you. On a clear sunny day, you can see the traffic situation a couple hundred feet down the road and react accordingly. On a rainy day, it helps to watch for the reaction of the driver ahead of you. When he brakes, you brake. Still keep a safe following distance from the car in front because you’ll need to brake more slowly on a slippery road to avoid skidding. So stay as far from the car in front of you as possible while also remaining close enough to keep it in clear sight.

3. Do not brake suddenly.

Sudden braking may cause a skid. Since the roads are slippery, stopping the wheels too quickly may cause them to lose all traction with the road, and an imminent car accident becomes a distinct possibility. In the case that skidding occurs, however, remain calm and do not make sudden turns because doing so may make the skidding even more dangerous. Just try to remain calm and steer straight until you feel the car regain traction.

4. Correctly defog your windows.

The windows on your car might fog, further limiting you visibility. You try to defog with the heater, but that will only further fog up your windows. To defog, keep your air conditioning blowing at both your windshield and your back window. If your car has a defog function, just press the button, and defogging should start automatically. Keep it on until all windows are clear!

5. Avoid standing water or flood water.

Most roads are built with the middle of the road higher than the sides, so try to stay near the middle of the road where it would be less likely to have a buildup of rainwater. If you do expect to go through standing water, lightly tap the brake pedal beforehand to dry the tire off a little.

Ideally, all rainy car accidents could be prevented if people stopped driving when it rains, but that is an unrealistic assumption. Everyone has things they must attend to, so just keep these tips in mind when driving in the rain. You can always pull over to the side and wait it out if you really think it’s raining too hard to drive. Nothing can make up for the loss of loved one in a fatal car accident, so always yield to safety.

ASWA Safety tips for driving in rain in Las Vegas:

When you are driving in heavy rain, visibility is decreased and hindered, so the following tips can help you avoid an accident.

Check your tires for tread and for proper inflation to avoid getting into a hydroplaning situation.

Avoid flooded roads and intersections. You never know when a flooded road can cause your vehicle to stall or when a flash flood could carry your vehicle away.

Check your brakes to make sure they are not saturated after driving through a puddle by braking lightly.

Slow down. Stopping distances are longer in the rain.

Turn gently. Turn gently on curves as your stopping and on highway on/off ramps as stopping distances are longer in the rain.

Don't follow too closely so you can react if a car brakes suddenly.

Use your low beams as high beams as rain can create a glare.

Use your turn signal to let other drivers know of your intentions.

Pull over and quit driving when rain is so heavy that you cannot drive safely. Try to pull completely off the road and use your emergency blinkers.

Is The Judgment Debtor a Nevada Resident with a Valid Nevada Homestead

 

 

Determining if Judgment Debtor is a Nevada resident requires proof of a variety of different factors

 

Generally. “Domicile” refers to your primary residence. The term is often used interchangeably with “residence”, but the term “legal residence” is closer. You may have several residence or places where you reside, but, in the United States, it is well accepted law that you
may only have one domicile or one legal residence.

 

If you make Nevada your “domicile”, it does not mean that Nevada is your exclusive place of residence, but it generally refers to the place that you reside most of the time or, at least, more than anywhere else during any given calendar year.

 

Each state has its own rules for establishing
residency or domicile. In Nevada, and presumably in many other states, there
are different definitions for different purposes, such as for filing a
complaint for divorce, for voter registration, and in-state tuition and a state
college or university.  It is possible for more than one state to assert
that you are domiciled in that state. If you want to avoid being classified as
a resident or domiciliary of another state, it is important to understand that
state’s laws. Those laws can be quite complex, particularly if they relate to
business and taxation. It may be necessary to follow procedures to formally
abandon your former domicile.

 

Nevada Supreme Court

 

In the case of Fleming v. Fleming, 36 Nev. 135, 134 Pac. 445, the Nevada
Supreme court held: “It is our judgment that the residence required by
the statute and contemplated by the session act was actual residence;
that is, physical, corporeal presence, and not alone legal residence
or domicile.”.... The court then explained that “Legal residence
consists of fact and intention combined; both must concur, and, when one's legal
residence is fixed, it requires both fact and intention to change it.”

 

In Williams v. Clark County Dist. Attorney , Supreme Court of Nevada, July 25,
2002118 Nev. 47350 P.3d 53639897, the court in an election campaign dispute,
explained that:

...In other words, if a candidate with more
than one permanent habitation can simply choose which habitation is the “actual
residence” for purposes of candidacy, without any consideration of legal
domicile, then the requirement of legal domicile, within
the definition of actual residence, ceases to exist....

...  As previously stated, a person can have
but one legal domicile, and cannot simply “declare” this legal
domicile, because it, by definition, depends on permanency and intent.

 

Nevada Statutory Law

281.050. Residence for purposes of eligibility for office is actual residence;  determination of residence;  vacancy in office upon certain changes in residence

NV ST 281.050West's Nevada Revised Statutes Annotated; Title 23. Public Officers and Employees (Chapters 281-289)

...A person may have an actual residence
in one place and a legal residence in another, and a person may
have several actual residences, but a person may have only one legal
residence or domicile....

...Statute providing that if a
person absents himself from the jurisdiction of his residence with the
intention in good faith to return without delay and continue his residence,
the period of absence must not be considered in determining the question of residence,
only applied when determining legal domicile, not actual residency
for purposes of eligibility to stand as candidate for mayoral election...

Florida Statute as example:

The
  legal language from the Florida legislature defines a Permanent Residence as
  the following:

 

 

“Permanent   Residence”……….. means the place where a person has his or her true,
  fixed and permanent home and principal establishment to which, whenever
  absent, he or she has the intention of returning. A person may have
  only one permanent residence at a time*; and, once a permanent
  residence is established, it is presumed to continue until he or she
  shows that a change has occurred.
Florida Statute, Section 196.012(18)

 

 

California Statutes

 

In determining residency for homestead purposes, courts consider (1) physical
occupancy of the property and (2) the intention with which the property is
occupied. In re Bruton, (BC SD CA 1994)167 BR 923, 926. The judgment debtor,
must live in the residence at the time the judgment is recorded and at the time
of the execution of the judgment or else the exemption will not apply. (Cal.
Code of Civ. Proc. § 704.720.)

 

DUAL RESIDENCY

If two states each determine that an individual is a “resident” (domiciliary or
statutory resident) subject to tax, that individual may be subject to
double taxation of his or her income. This situation can occur when an
individual attempts to change his domicile unsuccessfully, or when an
individual owns a residence in another state and time in the other state
now exceeds the minimum statutory threshold of days to subject that individual
to tax as a statutory resident.

 

Nevada Homestead Exemption

The Nevada Homestead Exemption protects up to $550,000 of the equity in your home. As long as your equity doesn't exceed $550,000, no creditor mark can sell your home to recover a debt, and no bankruptcy trustee can include your home in the bankruptcy estate. The
Nevada Homestead Exemption protects debtors' homes from consumer debts only. It
will not protect your home from seizure for delinquent alimony, delinquent
child support, mechanic's liens, liens for unpaid taxes or debts secured by a
deed of trust or mortgage. Regardless of how much equity you have, judgments
for these types of debts may result in the sale of your home. Additionally, if
the property was purchased with fraudulently procured funds, some case law
recognizes the right of the plaintiff to recover against the home in spite of
the homestead.

The Nevada Homestead Exemption protects debtors' homes from consumer debts only. It will not protect your home from seizure for delinquent alimony, delinquent child support, mechanic's liens, liens for unpaid taxes or debts secured by a deed of trust or mortgage.
Regardless of how much equity you have, judgments for these types of debts may
result in the sale of your home.

A homestead declaration will not prevent your home from being sold to pay a
judgment for:

 Taxes

 A mortgage, trust deed or other loan arrangement used to purchase or refinance your
property or improvements to your property.

 A mechanic’s lien or other obligation to pay because of improvements made to your property.

 Any lien to which you agree (consensual). 

INDICIA OF DOMICILE 

Physical Presence. Under Nevada law, the legal definition of domicile includes actual physical presence combined with an intent to remain indefinitely. You cannot be a Nevada resident unless you are here at least some of the time. If you leave, you must have the intent to return. Generally the legal residence of a person is in Nevada if the person has been physically present within the State during the period for which residency is claimed. Legal residence starts on the
day that such actual physical presence begins. Sometimes the more important
question is how does a person become a nonresident of his former state?

How can I change my residency to Nevada?

The simple answer is you need to move here. You will have to abandon your
domicile in California or elsewhere and establish domicile in Nevada. If you
maintain multiple residences, you have to make Nevada your principal place of
residence, your primary home.

Do I have to move to Nevada permanently?

In order to considered a nonresident of your former state you must generally
establish that your intent to leave your former state was for other than a
temporary or transitory purpose. If your absence is temporary you will
generally continue to be considered a resident of your former state. 

Key Elements the court may consider

While physical presence is a major element in establishing your domicile, proof of domicile also includes a number of key elements that are looked at as indicia of domicile, which include doing the following — or at least most of the following — in Nevada: 

(a) Moving into a home, condominium, or apartment with the furniture, furnishings, and possessions that indicate an intent to make this your primary residence;

(b) Filing an declaration of domicile with the county clerk;

(c) Registering to vote;

(d) Registering your vehicles;

(e) Obtaining a driver’s license;

(f) Recording an executed homestead declaration with respect to your primary Nevada residence with the county recorder;

(g) Using your Nevada address for state and federal tax purposes and filing a change of address with the IRS and other tax authorities on the prescribed form(s);

(h) Using your Nevada address for primary correspondence, including credit cards, magazines, bank accounts, etc. and filing a change-of-address form with the U.S. Postal Service;

(i) Transferring significant cash and securities holdings to Nevada institutions;

(j) Using — but not necessarily exclusively — one or more Nevada advisors, such as a Nevada attorney or accountant;

(k) Having your trust and/or will updated to reflect your Nevada residency and to reflect Nevada law; and

(l) Establishing memberships in civic, religious, and community organizations.

 Declaration of Domicile. Nevada law permits a person to declare that Nevada is his or her domicile residence by signing “a sworn statement showing that he resides in and maintains a residence in that county, which he recognizes and intends to maintain as his permanent home.”

 

CONCLUSION

To be a Nevada resident essentially requires that you be here for a majority of the time with the intent to remain here.

If it is important that other states consider you as a Nevada resident, the more “indicia of domicile” that point to Nevada, the more likely you are to be successful.

 

Warning:

 Declaring yourself a resident or domiciliary of a state is not enough. You actually have to spend more time living here than you live anywhere else. If a couple spends nine
months a year in California and three months a year in Nevada, they are
California residents even if they have done most of the things mentioned above
that would show that they are Nevada residents. 

Most people who are not bona fide residents of Nevada leave a paper trail (with receipts for purchases such as gas, food, and living expenses) and an electronic trail (with things such as cell-phone calls and ATM withdrawals) that is evidence of their real domicile.

About the Authors: The law firm of Albright, Stoddard, Warnick & Albright is an A-V Rated Nevada-based full-service law firm having attorneys licensed in Nevada, California and Utah.  Our firm’s practice includes a strong emphasis on construction law, contracts and litigation in the jurisdictions where we are licensed.

Note: This article, and any other information you obtain at this website, is not offered as legal advice, nor should it be relied upon as such, nor is it a solicitation for legal services.  Only a licensed attorney can advise you with respect to your specific legal needs. We welcome your contacting our firm to discuss such representation.  Contacting us does not create an attorney-client relationship. Please do not send any confidential information to us until such time as an attorney-client relationship has been established.

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