nevada reports 1964 (80 nev.).pdf

7/21/2019 Nevada Reports 1964 (80 Nev.).pdf

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80 Nev. 1, 1 (1964)

REPORTS OF CASES

DETERMINED BY

THE SUPREME COURT

OF THE

STATE OF NEVADA

____________

Volume 80

____________

80 Nev. 1, 1 (1964) Department of Highways v. Roman Catholic Bishop

THE STATE OF NEVADA, On relation of Its Department of Highways, Appellant, v.

ROMAN CATHOLIC BISHOP OF RENO, a Corporation Sole, ROBERT J. DWYER,Incumbent, Vestee, Respondent.

No. 4713

January 16, 1964 388 P.2d 202

On motion to dismiss appeal.

Action wherein the Second Judicial District Court, Washoe County, Thomas O. Craven,

Judge, rendered judgment, and the State appealed. The Supreme Court held that state legal

research assistant's inexperience in appellate procedure, and misreading of rule, was notexcusable neglect with respect to State's failure to docket record on its appeal within

maximum time permitted.

Motion granted.

80 Nev. 1, 2 (1964) Department of Highways v. Roman Catholic Bishop


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Harvey Dickerson, Attorney General,Robert J. Potter, Deputy Attorney General,Eli

Grubic, Special Deputy Attorney General, of Carson City, for Appellant.

Belford & Anglim, of Reno, for Respondent.

1. Appeal and Error.

State legal research assistant's inexperience in appellate procedure, and misreading of rule, was not

excusable neglect with respect to State's failure to docket record on its appeal within maximum time

permitted. NRCP 73(g), 75(a).

OPINION

Per Curiam:

In this case the State failed to docket the record on appeal within the maximum time

permitted by NRCP 73(g). It had secured a district court order extending the time within

which to do so to a day not more than 90 days from the date of filing its notice of appeal. Therecord on appeal was finally filed with this court 23 days late. Because of this the respondent

moved to dismiss the appeal. The State seeks to defeat the motion by the affidavit of a legal

research assistant of the highway department, purporting to show excusable neglect. It

appears from that affidavit that 88 days had passed without any action by the State to secure

the record on appeal. Indeed, not even a designation of the contents of such record was filed

(NRCP 75(a)), though this must be done promptly after the appeal is taken. The excuse

offered for such neglect is the inexperience of the research assistant with appellate procedure,

and his misreading of the plain language of NRCP 73(g). We do not consider that the excuse

offered constitutes excusable neglect. Cf. McDowell v. Drake, 77 Nev. 136, 360 P.2d 257.

The respondent's motion to dismiss is granted.

____________

80 Nev. 3, 3 (1964) Kowalchuk v. Hall

JOE KOWALCHUK, MATT BERNARD, RAY EDISON, BOB CARVER,

GLEN MENDENSHAUSEN and PETE STRUZIS, Appellants, v. DONALD T. HALL and

ANDY ANDERSON, Respondents.

No. 4646

January 20, 1964 388 P.2d 201

Appeal from judgment of the First Judicial District Court, Douglas County; Frank B.


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Gregory, Judge.

Specific performance case. The lower court gave summary judgment for the defendant.

The plaintiffs appealed. The Supreme Court, Thompson, J., held that purchasers of lots in

subdivision from seller and subdivider who allegedly failed to keep his promise to pave all

roads in subdivision had adequate legal remedy and not remedy of specific performance,where alleged promise was made after dedication of roads to county, and cost to pave roads

was ascertainable as well as any consequential damages flowing from failure to pave.

Judgment affirmed.

Carl F. Martillaro, of Carson City, for Appellants.

Cameron M. Batjer, of Carson City, for Respondents.

1. Specific Performance.Purchasers of lots in subdivision from seller and subdivider who allegedly failed to keep his promise to

pave all roads in subdivision had adequate legal remedy and not remedy of specific performance, wherealleged promise was made after dedication of roads to county, and cost to pave roads was ascertainable as

well as any consequential damages flowing from failure to pave. NRS 116.060.

2. Specific Performance.Generally, specific performance will be refused where performance of promise requires conduct by one

over whom promisor has no right of control.

OPINION

By the Court, Thompson, J.:

In the lower court six plaintiffs (purchasers of subdivision lots) joined in seeking a decree

of specific performance to compel the defendant Hall (the seller and VXEGLYLGHUWRSDYHDOOURDGVZLWKLQWKHVXEGLYLVLRQ


subdivider) to pave all roads within the subdivision. They claim that the defendant had

promised to do so, and that they had relied upon his promise in deciding to purchase their

respective lots from him. Hall, by answer, denied their charges, and subsequently moved for

summary judgment. NRCP 56. His motion was granted and judgment entered in his favor.The plaintiffs appeal.

[Headnote 1]

The record presented to the district court and now to us shows that on July 5, 1955, Hall

and his wife duly acknowledged and recorded a subdivision plat for Kingsbury Meadows

Subdivision, Lake Tahoe, Douglas County, Nevada. The plat had been accepted without

reservation by the board of county commissioners. The avenues, roads, streets, etc. depicted


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thereon were thereby dedicated in fee to Douglas County. NRS 116.060; Charleston Plaza,

Inc. v. Bd. Educ., 79 Nev. 476, 387 P.2d 99 (school site). The promise to pave all roads

within the subdivision claimed by the plaintiffs to have been made by Hall, was made (if at

all) after Douglas County had become the owner of them. The legal question presented below

and here is whether the remedy of specific performance is available to the plaintiffs in such

circumstances. We agree with the lower court that it is not.

[Headnote 2]

It is evident to us that the plaintiffs can obtain justice by a judgment for money damages, if

the alleged contract to pave the roads is proved and there exists no lawful defense to an action

for its breach. Cf. Barcroft Woods, Incorporated v. Francis, 201 Va. 405, 111 S.E. 2d 512.

The cost to pave the roads is ascertainable, also other consequential damages, if any, flowing

from the failure to pave. The legal remedy would be adequate. Furthermore, the prior plat

dedication vesting title and control of the roads in Douglas County is a circumstance which

renders specific performance impracticable. Villa Corp. v. S. D. Walker, Inc., 3 Cir., 187 F.2d

493; Fiedler, Inc. v. Coast Finance Co., 129 N.J.Eq. 161, 18 A.2d 268, $/5

&RUELQ&RQWUDFWVDW*HQHUDOO\VXFKUHOLHIZLOOEHUHIXVHGZKHUHWKHSHUIRUPDQFHRIWKHSURPLVHUHTXLUHVFRQGXFWE\RQHRYHUZKRPWKHSURPLVRUKDVQRULJKW

RIFRQWURO


135 A.L.R. 273; 5 Corbin, Contracts 1170, at 737. 1 Generally, such relief will be refused

where the performance of the promise requires conduct by one over whom the promisor has

no right of control. The principle applies here. In our view, the plaintiffs' choice of remedy isplainly wrong. Other points raised need not be discussed. The summary judgment entered

below is affirmed.

Badt, C. J., and McNamee, J., concur.

____________________

1

The Corbin statement is: If the performance promised is one that cannot take place without the

co-operation of a third person, this will frequently bring the case within the rule against decreeing specific

performance.

____________

80 Nev. 5, 5 (1964) Arley v. Liberty Mutual Fire Insurance Co.

CHARLOTTE HUNTER ARLEY, Appellant, v. LIBERTY MUTUAL FIRE INSURANCE

COMPANY, a Massachusetts Corporation, Respondent.


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No. 4640

January 23, 1964 388 P.2d 576

Appeal from judgment of the Second Judicial District, Washoe County; Clel Georgetta,Judge.

Action on fire policy. The trial court rendered judgment for insured, and insured appealed

from portion of judgment denying full amount of insurance covering personalty and rental

income and denying recovery of interest and attorney fees. The Supreme Court, Badt, C. J.,

held that findings and judgment for insured for loss of personalty and loss of rental income as

result of fire were properly limited to and by amounts which fire insurer admitted to be due

where insured had failed to inform insurer of what items of personalty had been damaged or

destroyed and had failed to show past expenses from which probable net rentals could have

been determined.

Affirmed.

[Rehearing denied February 26, 1964]

80 Nev. 5, 6 (1964) Arley v. Liberty Mutual Fire Insurance

Charlotte Hunter Arley, of Portland, Oregon, andLeslie M. Fry, of Reno, for Appellant.

Woodburn, Forman, Wedge, Blakey, Folsom, and Hug, of Reno, for Respondent.

1. Insurance.Allegation that insured had furnished insurer with notice and proof of loss in accordance with policy and

insurer's denial of allegation were specific and particular within rule regarding pleading the

performance or occurrence of conditions precedent. NRCP 9(c).

2. Pleading.By presentation of evidence on sufficiency of proof of loss without raising of any question of pleading,

technical point of sufficiency of denial that proper proof of loss had been furnished was waived, and legal

sufficiency of proof of loss could be determined on the merits. NRCP 9(c), 15(b).

3. Trial.

Failure to make finding as to amount of loss of furniture and fixtures as result of fire was justified forfailure of insured to supply fire insurer with proof of loss containing exactly the items of personalty

damaged or destroyed.

4. Insurance.Fire policy providing for payment of loss of rental income not exceeding actual loss for time required in

exercise of due diligence and dispatch to restore building entitled insured to recover gross rental minus

expenses of rental operation.

5. Trial.In absence of evidence to establish expenses insured had sustained in connection with renting to others


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building destroyed by fire and covered by fire policy authorizing payment to insured for actual loss of

rental income, failure to find amount of loss of rental income was justified.

6. Insurance.Findings and judgment for insured for loss of personalty and rental income as result of fire were properly

limited to and by amounts which fire insurer admitted to be due in case wherein insured had not informed

fire insurer of what items of personalty had been damaged or destroyed and had failed to show past

expenses from which probable net rentals could have been determined.7. Tender.

Evidence justified finding that fire insurer's admission of liability for payment of specified sums for loss

of personalty and rent might be considered a tender of those amounts to insured who refused tender and

brought suit.

8. Interest.Losses on building, personalty, and rent as result of fire were not liquidated other than by judgment,

which awarded amounts equal to fire insurer's admission of liability for loss ofSHUVRQDOW\DQGUHQW

DQGDPRXQWKLJKHUWKDQLQVXUHUVDGPLVVLRQIRUORVVRIEXLOGLQJDIWHUYROXPLQRXVHYLGHQFHKDGEHHQFRQVLGHUHGDWJUHDWOHQJWKDQGLQWHUHVWGLGQRWFRPPHQFHWRUXQSULRUWRHQWU\RIMXGJPHQW


personalty and rent and amount higher than insurer's admission for loss of building after voluminous

evidence had been considered at great length, and interest did not commence to run prior to entry of

judgment. NRS 99.040.

9. Costs.Refusal to allow attorney fees under rule making attorney fees allowable when it appears to satisfaction of

court that affidavits are presented in bad faith solely to delay was discretionary. NRCP 56(g).

10. Appeal and Error.Point not raised in trial court could not be raised on appeal.

OPINION

By the Court, Badt, C. J.:

Appellant, plaintiff below, sued the respondent insurance company upon an insurance

policy in the face amount of $43,600, which covered the building, its furniture and fixtures,

and rental income; $35,000 covered the building, $5,000 covered the furniture and fixtures,

and $3,600 covered the rental income. Upon the company's refusal to pay the full amount of

appellant's claim as demanded, she sued to recover the full amount of the policy, together

with interest and attorney fees. The trial court found that there was a total loss of the buildingand awarded appellant judgment for the full $35,000 on this coverage, but allowed her

$4,014.21 for the loss of the personal property and $600 for the loss of rental incomethese

being the respective amounts admitted by respondent as the amount of loss on said two items.

It denied recovery for interest and attorney fees demanded by appellant.

Appellant appealed from that part of the judgment denying the full amount of insurance

which covered the personal property and rental income and which denied recovery of interest

and attorney fees. We conclude that the judgment was in all respects proper and without error


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and must be affirmed.

Appellant filed with her record on appeal a statement of the points on which she intended

to rely on the appeal, NRCP 75(d), specifying error in the following: (1) LQGHQ\LQJSODLQWLIIWRWDOORVVRQKHUSHUVRQDOSURSHUW\LQGHQ\LQJSODLQWLIIWRWDOORVVRQKHUUHQWDOLQFRPHLQGHQ\LQJSODLQWLIISUHMXGJPHQWLQWHUHVWRQWKHIXOODPRXQWRIKHUORVV

DQGLQGHQ\LQJSODLQWLIIDQDWWRUQH\VIHH


in denying plaintiff total loss on her personal property; (2) in denying plaintiff total loss

on her rental income; (3) in denying plaintiff pre-judgment interest on the full amount of her

loss; and (4) in denying plaintiff an attorney's fee. This was subject to some variance in the

specification in her opening brief, SCR 23(2) (c), of the errors of law which the appeal seeks

to correct. The specification of error there is (1) that the findings are insufficient to support

the judgment in that the court (a) failed to make a finding as to the amount of loss of thefurniture and fixtures, and (b) as to the amount of loss of rental income; (2) that the court's

conclusions are contrary to law in that (a) the sufficiency of the proof of loss was not in issue,

(b) that the plaintiff's right to recover for the loss of her furniture and fixtures was not forfeit,

(c) that plaintiff did not fail to sustain her burden of proof on the issue of rental income loss,

(d) that she was entitled to interest as part of the judgment on the full amount found due, and

(e) that she was entitled to an attorney's fee as part of the judgment.

A pretrial order was made pursuant to a pretrial hearing in which the court defined the

issues of law and facts involved and to which the trial of the issues was confined. After the

trial the case was submitted to the trial court on oral argument and briefs, and the court filed a

scholarly opinion comprising 36 typewritten pages in which it thoroughly explored anddetermined every issue advanced by the parties.

[Headnote 1]

Some procedural matters must first be disposed of. Appellant contends as noted that the

sufficiency of the proof of loss was not in issue. In support of this, she relies on NRCP 9(c).1

Plaintiff's averment in this respect was contained in paragraph 5 of her complaint as follows:

Plaintiff has furnished defendant with QRWLFHDQGSURRIRIORVVLQDFFRUGDQFHZLWKWKHWHUPVRIWKHSROLF\DQGKDVRWKHUZLVHGXO\SHUIRUPHGDOORIWKHFRQGLWLRQVDQGKDV

FRPSOLHGZLWKDOORIWKHUHTXLUHPHQWVWKHUHRI

____________________

1

NRCP 9 (c). Conditions Precedent. In pleading the performance or occurrence of conditions precedent, it

is sufficient to aver generally that all conditions precedent have been performed or have occurred. A denial of

performance or occurrence shall be made specifically and with particularity.


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notice and proof of loss in accordance with the terms of the policy, and has otherwise duly

performed all of the conditions and has complied with all of the requirements thereof.

Respondent's answer to such paragraph was: Denies the averments of paragraph 5. It is

difficult to see how the denial of plaintiff's allegation that she had furnished defendant withnotice and proof of loss in accordance with the terms of the policy could be made more

specifically or with greater particularity. In this respect we can ignore the general allegation

of performance of conditions precedent and confine ourselves to the particular allegation as to

furnishing notice of proof of loss in accordance with the terms of the policy. Both the

allegation and the denial were specific and particular.

The policy required the plaintiff to furnish a complete inventory of the destroyed,

damaged, and undamaged property, showing in detail quantities, costs, actual cash value, and

amount of loss claimed, and to render to the company a proof of loss signed and sworn to by

the insured showing the actual cash value of each item thereof and the amount of loss thereto

and verified plans and specifications of buildings, fixtures, or machinery destroyed ordamaged, and to produce, if required, books of account, bills, invoices, and other vouchers,

and in case the parties should fail to agree as to the actual cash value or amount of loss, that

(as expressed by the trial court) either party, on written demand may put into effect an

arbitration proceeding outlined in the policy. No arbitration proceeding was demanded or

adopted.

The fire occurred May 26, 1960. On July 25, 1960, appellant filed notice and proof of loss.

On July 28, 1960, respondent wrote appellant that the purported proof of loss is defective

and incomplete in the following respects:

1- * * * the information set forth therein is totally inadequate and incomplete.

2- In the said instrument the total cash loss and damage is stated as follows: Actual cash

value of realty$38,890.00, although an exact amount of loss and damage verified bynecessary detail is not attached.

In the said instrument the total cash loss and damage RQSHUVRQDOSURSHUW\LVVWDWHGLQWKHDPRXQWRIEXWQRVFKHGXOHRIORVVDQGGDPDJHVHWWLQJIRUWKWKHDPRXQWRI

ORVVDQGWKHQHFHVVDU\GHWDLOLVDWWDFKHG


on personal property is stated in the amount of $5,500.00, but no schedule of loss and damagesetting forth the amount of loss and the necessary detail is attached.

In the said instrument the total cash value and loss and damage on rental income is stated

in the amount of $600.00, however, no supporting evidence is attached.

3- You have made claim of loss amounting to $40,600.00 which is not supported by any

plans, specifications or detail of any kind which would tend to show the extent of loss and

damage claimed.

4- There is no schedule supporting the claim of cost or loss on household furniture


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and/or personal property and the company requests certified plans and specifications of the

building and also a recapitulated detail of personal property destroyed.

The said Liberty Mutual Insurance Company totally disagrees with you as to the amount

of loss claimed by you on each and all of the different articles of property set forth in said

purported preliminary proof of loss and to each and all thereof.

The said above mentioned Company admits that you suffered a loss of $23,267.28 to thebuilding.

The said above mentioned Company admits that you suffered a loss of $4,014.21 to

household furniture and personal property.

The said above mentioned Company admits that you suffered a loss of $600.00 on rental

income coverage.

The letter added that it did not waive any of its rights or any defenses under the policy, but

specifically reserved the same.

[Headnote 2]

We are satisfied that the sufficiency of the proof of loss was directly placed in issue under

NRCP 9(c). Coral Gables, Inc. v. Skehan, 47 F.Supp. 1 (D.C.N.J. 1942). In further support ofthis conclusion, after determining that there was a total loss of the building, the court properly

stated that both sides presented evidence without raising any question of pleading.

Therefore, the court determines that each side has waived the technical point of pleading

above discussed and the court is now IUHHWRGHWHUPLQHWKHOHJDOVXIILFLHQF\RIWKH3URRIRI

/RVVXSRQWKHPHULWVDVSUHVHQWHGE\WKHHYLGHQFH


free to determine the legal sufficiency of the Proof of Loss' upon the merits as presented by

the evidence. Accordingly, this was also authorized and justified by reason of NRCP 15(b).2

Whiteman v. Brandis, 78 Nev. 320, 372 P.2d 468.

[Headnote 3]

Appellant's next contention of a procedural nature is that the court (a) failed to make a

finding as to the amount of the loss of the furniture and fixtures, and (b) as to the amount of

loss of rental income. As noted, the company notified appellant of the insufficiency in the

proof of loss supplied by appellantparticularly in her failure to comply with the contract

requirements to furnish (1) description of property, (2) nature and extent of loss or damage,(3) where purchased, (4) when, (5) original cost, (6) value at time of loss, (7) cost of repair.

The trial court said: None of this information was given on this schedule as to the items of

furniture. The only mention of personal property anywhere on this Proof of Loss is on the

face where there are typed the words, Personalty Loss, Total.' That was not true. The

evidence at the trial established that the personal property damaged or destroyed was only a

part of the property insured, and, therefore, was only a partial loss' even though the plaintiff

contended that the actual loss in value exceeded the policy limit. The defendant was entitled


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to be informed exactly what items of personal property had been damaged or destroyed. In

arranging settlement under the policy, the defendant was not compelled to accept the

plaintiff's statement, Personalty Loss, Total,' and so informed her. * * * The plaintiff did not

correct the deficiency by supplying an amended or supplemental Proof of Loss.' Instead, she

refused to do so, * * * but merely repeat[ed] Furniture and fixtures described as Item 2 has

an actual cash value of $5,000 and the loss of said Item 2 is $5,000.'The learned trial judge then discussed at some length Clark v. London Assurance Corp., 44

Nev. 359, 195 P.

____________________

2

When issues not raised by the pleadings are tried by express or implied consent of the parties, they shall be

treated in all respects as if they had been raised in the pleadings. * * *


809, and Engleman v. Royal Ins. Co., 56 Nev. 319, 51 P.2d 417, 101 A.L.R. 1294, and

correctly concluded that while failure to furnish a proof of loss' within the 60 day limited

perioddoes not constitute a forfeiture of the insurance coverage, * * * no recovery can be

had until such proof of loss, as required by the policy, has been furnishedeven after the 60

day period has expired. The trial court's ultimate conclusion was that as to the furniture,

linens, dishes, and other such household items, the Proof of Loss was not legally sufficient

in either fact or law. Under such conclusion the court could not make a finding as to the

amount of loss of the furniture and fixtures.

[Headnotes 4, 5]

In like manner the court was justified in refusing to make a finding as to the amount of

loss of rental income. The rent loss rider, article 6, provided for the payment to the insured

of the loss of rental income * * * but not exceeding the actual loss sustainedby the insured

resulting from such untenantability, and for such length of time as would be required with the

exercise of due diligence and dispatch to restore to a tenantable condition such building * *

*. Quoting from Chronicle Bldg. Co. v. New Hampshire Fire Ins. Co., 21 Ga.App. 687, 94

S.E. 1043, and also referring to 1 Couch, Insurance, 2nd, 1.92, at 94, and 45 C.J.S.,

Insurance 920, at 1027, and 5 Appleman, Insurance 3119, at 275, the court correctly

concluded the amount of liability is measured by the gross rental minus the expenses of theinsured's operation, and further from the Chronicle Bldg. case, Under such a policy, the

liability of the insurer for such an actual loss is to be measured by what would have been the

gross rental during the period covered by the policy, less the expenses of operation devolving

upon the insured. In this respect the court held:

Before the fire, the plaintiff collected total gross rentals of $735.00 a month. Out of this,

she had expenses to pay such as electrical power bills, water, fuel oil for heat, janitor service

for the halls and stairs, even if not for inside the units. She had a yard, trees and lawn to


11/482

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maintain. She had taxes to pay and also premiums on even this fire insurance policy if no fire

had occurred.

After the fire, the plaintiff was relieved of most of these expenses; in fact all of them,

except taxes on the land * * *.

The trial court's conclusion that plaintiff was entitled to receive only the actual loss

sustained by reason of the indemnification provision in the policy, and accordingly, only the

net rental income was without error. The court's further statement that, The evidence in this

case provides no way for the Court to determine even an approximate amount is fully

justified. No evidence was offered by the plaintiff to establish the past expenses from which

the probable net rentals could be determined.

[Headnote 6]

Accordingly, on the two items last discussedthe insurance on the furniture and the rental

revenuethe court's findings and judgment, as well as the court's refusal to make a finding

by reason of lack of evidence to support a finding, were properly limited to and by the

amounts which respondent admitted to be due. Appellant's constant reiteration of the

statement that as to these two items the loss was total is no answer. The trial court was

talking about the sufficiency of the evidence upon which to base a finding. On the motion to

amend the findings and the judgment the court even reserved judgment until the court

reporter's transcript could be completed on certain items. We find no error in the court's final

conclusion as to the insurance on the furniture and on the rental revenue.Appellant next contends that the court was in error in failing to allow interest on each of

the three items of recovery. The rule in Nevada is declared in Agricultural Ins. Co. v. Biltz,

57 Nev. 370, 64 P.2d 1042. In that case the court, after quoting section 4322 NCL, now NRS

99.040, said:

The policy of insurance is a contract and contains the following stipulation:

The loss shall not become payable until sixty days after notice, ascertainment, estimate,

and satisfactory SURRIRIORVVKHUHLQUHTXLUHGKDYHEHHQUHFHLYHGE\WKLVFRPSDQ\

LQFOXGLQJDQDZDUGE\DSSUDLVHUVZKHUHDSSUDLVDOKDVEHHQUHTXLUHG


proof of loss herein required have been received by this company, including an award by

appraisers where appraisal has been required.'

This stipulation provides methods for establishing the loss, in other words, for liquidating

the claim and fixing a time thereafter for payment. But as there was no satisfactory proof of


12/482

loss, or valid award, the demand was unliquidated until the rendition of judgment.

The money did not become due under the statute until then. The statute is in harmony

with the general rule that interest is not recoverable upon unliquidated demands, but is

allowable only after such demands have been merged in a judgment.3

[Headnote 7]The court's formal findings as to the two items of loss, the furniture and the rentals were:

XXXVI. The amounts defendant has admitted liability for in the sum of $4,014.21 for loss

of personal property, and $600 for loss of rent were not liquidated. XXXVII. The defendant's

admission of liability for the payment of $4,014.21 for loss of personal property and $600 for

loss of rents may be considered a tender of those amounts, which tender was refused by the

plaintiff. These findings are fully justified by the evidence. Appellant cites a number of

authorities contra, but we do not find the same in point or controlling.

[Headnote 8]

The trial court's pretrial order, under the defendant's admission of liability, recited such

admission of liability as follows: $23,276.28 on the building, $4,014.21 on the personalproperty, and $600 on rental income. As noted, the offer was rejected. The loss on the

building was established by judgment to be $35,000.4 As to each DQGDOORIWKHVHWKUHHLWHPVWKHUHVSHFWLYHDPRXQWVZHUHQRWOLTXLGDWHGRWKHUWKDQE\WKHMXGJPHQWLWVHOI

____________________

3

For an analysis of the holding in Agricultural Ins. Co. v. Biltz, supra, see Dollar Investment Corp. v.

Modern Market, Inc., 77 Nev. 393, 365 P.2d 311.

4 The lower court considered the voluminous evidence on this point at great length before allowing the fullcoverage on the building. The insurance company took no appeal. Accordingly, this item is not in issue and

requires no discussion.


and all of these three items, the respective amounts were not liquidated other than by the

judgment itself. Accordingly, interest did not commence to run prior to the entry of judgment.

[Headnotes 9, 10]

Appellant's final contention is that the court erred in not allowing her attorney fees as part

of the judgment. It appears from the record that at the hearing of appellant's motion to reopen

the case for further testimony appellant specifically waived attorney fees for the trial. Indeed

under NRS 18.010(2), restricting the power of the court to allow attorney fees to cases in

which the demand was less than $3,000, the court had no authority to allow an attorney fee.

While appellant takes issue with the contention that there was a waiver by appellant, it is


13/482

clear to us that such is the case. However, appellant bases the present contention on NRCP

56(g). Under this section attorney fees are allowable when it appears to the satisfaction of the

court that any affidavits are presented in bad faith solely for the purpose of delay. Such

allowance was within the discretion of the court. Nothing in the record indicates an abuse of

such discretion in the court's denial of attorney fees under this section. Appellant now seeks

attorney fees on a third ground, namely, that the insurance policy was written in Oregon andis governed by Oregon law, and asserts that this is a matter of full faith and credit. So far as

the record before us discloses, this point was not raised in the trial court and may not be

raised here for the first time. In re Devincenzi's Estate, 65 Nev. 158, 190 P.2d 842; Goldring

v. Kline, 71 Nev. 181, 284 P.2d 374. There was no error in the denial of attorney fees.

The judgment is affirmed with costs.

McNamee, J., and Marshall, D. J., concur.

Thompson, J., being disqualified, the Governor commissioned Honorable George E.

Marshall, Judge of the Eighth Judicial District Court, to sit in his place.

____________

80 Nev. 16, 16 (1964) Kaltenborn v. Bakerink

R. J. KALTENBORN, Doing Business as GENERAL AUTO PARTS, and DUANE KEMP,

Appellants, v. CLAYTON E. BAKERINK, Respondent.

No. 4641

January 24, 1964 388 P.2d 572

Appeal from the Eighth Judicial District Court, Clark County; John F. Sexton, Judge.

Action to recover for damages caused by alleged negligence. The lower court entered

judgment on a verdict for plaintiff and denied defendants' motion for new trial, and

defendants appealed. The Supreme Court, McNamee, J., held that the verdict was not

objectionable on ground of misconduct of jury, even if in course of discussion as to amount

of verdict, the jurors from time to time without binding themselves to abide by the resultdetermined the average of the different amounts which the several jurors at the time thought

should be awarded until they arrived at a figure which all agreed was reasonable.

Affirmed.

Morse & Graves, of Las Vegas, for Appellants.

Lionel & Gunderson, of Las Vegas, for Respondent.


14/482

1. Trial.For jurors to agree in advance to particular mode of arriving at verdict and to abide by the contingent

result without reserving right to dissent is improper and verdict arrived at by such means should be set

aside.

2. Trial.Jurors may properly determine the average of the different amounts which in the judgment of each should

be awarded as damages, provided such method is adopted merely for purpose of arriving at a reasonable

amount without being bound by the result.

3. New Trial.Verdict awarding damages for alleged negligence was not objectionable on ground of misconduct of jury,

even if, in course of discussion as to amount of verdict, jurors from time to time but without binding

themselves to abide by the result determined the average of the different amounts which the several jurors

at the time thought should be awarded until they arrived at figure which all agreed was reasonable.


4. New Trial.Neither testimony of juror nor affidavit of what affiant was told by juror as to how jury arrived at verdict

is competent to impeach jury's verdict.

OPINION

By the Court, McNamee, J.:

This is an action for damages resulting from the alleged negligence of the defendants

(appellants herein). The jury rendered a verdict of $58,000 for respondent and judgment

thereon was entered. Thereafter, appellants moved for a new trial in part upon the ground ofmisconduct of the jury. The motion was based on the affidavit of William R. Morse, one of

the attorneys for appellants, and the oral testimony of Edward I. Cohen, foreman of the jury.

Appeal is from the judgment and from the denial of appellants' motion for a new trial.

It appears from the Morse affidavit that after the jury returned its verdict and while Cohen

was leaving the courtroom, Morse inquired of Cohen upon what basis the jury arrived at its

verdict; that Cohen replied, it was a simple matter; that he had each member of the jury

write upon a piece of paper the amount of money each one of them thought that Plaintiff

should be entitled to recover; that he thereafter totalled the amounts and divided by twelve

and that said sum of $58,000.00 was the result of such computation.

The transcript of the proceedings on the motion for new trial shows that appellants offeredin evidence the Morse affidavit in support of the motion. The record is silent however

whether the court received it in evidence. Cohen was then called as a witness for the movants.

Over the objection of respondent he testified as follows:

By The Witness: A. When we got the case we walked into the Jury room and we sat

down and they elected me as the foreman. Now, each Juror, we talked it over about the case.

One Juror wanted to give so much and the other Juror wanted to allow so much and this DQGWKDW


15/482


and that. I asked the rest of them what they were going to do. One of the Jurors suggested thatwe take what expenses he had with the doctors and the hospital, how much he would have

earned as a heavy duty operator, and what he is earning now, take the figure that he is asking

and lump it all together, and then each Juror divide it by 12 and find out what the verdict

would be. Now, the first time we went around, one of the Jurors I remember, said the verdict

was too little. Another Juror said it was too big. In other words we went around about 3 or 4

times before we finally arrived at the figure that you have there, which I understand they cut

off the salary that he would have earned as a heavy duty operator and figured the salary he is

earning now as business agent for the Union and then we put together his hospital bills and

everything and then we came to that figure.

By Mr. Morse: Q. Now, isn't it a fact that you had them write down on a slip of paper

what they thought he was entitled to?

A. Yes sir.

Q. And then you added that up and then you divided it by 12 and that figure was

$58,000.00?

A. Yes, that's right, sir.

* * * * *

By Mr. Morse: Q. It was agreed on by the Jury to find their verdict by this means?

A. Yes.

On cross-examination Cohen testified as follows:

By Mr. Lionel: Q. Mr. Cohen, isn't it true the Jury considered for some time the amount

of damages?A. Yes, we talked it over.

Q. And there was quite a disparity between yourself and various members of the Jury?

A. That's right, sir.

Q. About how many times did you go around and write figures on paper?

A. We went around, as far as I can remember, I think about 5 or 6 times we went around.

Q. And all Jurors wrote down a different figure?

A. Wrote down different figures and talked it over.


Q. And you say finally there was a figure that was divided by 12. Is that right?

A. That's right.

Q. And isn't it true that that figure that the people wrote down was divided by 12 and you

or one of the Jurors said Let's see what will happen if we do this'?

A. That's right, yes.


16/482

Q. Exactly what was said at that time?

A. Well, as far as I can remember, one of the ladies of the Jury said that if we give too

much, too big of a verdict, we are punishing the insurance company. I spoke up and I said that

nobody is being punished. All we were there for was one reason and that was to give the man

what he was entitled to. Then we tore up the slips of paper that we had wrote previous to this

question and we went around again and when we got to the second time, as far as I canremember, one of the fellows, a gentleman there that was working for one of the air lines,

said that the man wasn't entitled to that amount of money, that it seemed to him that nobody

would earn that kind of money in a lifetime, so we talked over those things and then we went

around two or three times more and finally, the last time we wrote the slips down, everybody

read the slips and we added, totaled it up. Then is when we arrived at a verdict, the last time

when we all came to that figure.

Q. In other words as I understand it, there was about three times you did this and finally

you reached a figure and then was it that price figure that you gave or was it increased or

rounded off or anything?

A. It was rounded out to come to an even figure.

Q. And then after it was rounded off to come to an even figure, did the Jurors then voteon that figure? Did you vote on that figure?

A. We all agreed to that figure, if that's what you call a vote.

Q. I mean after that figure(interrupt)

A. After that figure was given, before we called for the Bailiff, we agreed on that figure.

Q. And was that figure discussed?


A. That figure was discussed and everybody agreed that they didn't think that was too

much or too little. In denying the motion for new trial it does not appear whether the court

did so on the basis that the evidence was incompetent or because it was insufficient.

[Headnotes 1, 2]

In Lee v. Clute, 10 Nev. 149, 153, this court has said: The rule, as stated in many of the

decided cases, is to the effect that if the jurors previously agree to a particular mode of

arriving at a verdict, and to abide by the contingent result at all events, without reserving to

themselves the liberty of dissenting, the verdict should be set aside; but if the method is

adopted merely for the sake of arriving at a reasonable amount without binding the jurors bythe result, the verdict should stand. (citations)

The cases where verdicts have been set aside proceed upon the theory that if upheld,

where jurors bind themselves in advance, it might lead to great injustice, because it would

enable one inveterate juror, by marking down a very large or small sum, to produce an

average and procure a verdict for an amount which would be unreasonable, and at utter

variance with the judgment of the other jurors. This would be a chance verdict, and whenever

such misconduct is properly shown, the verdict ought to be set aside. In every case the verdict


17/482

ought to be the result of reason, reflection and conscientious conviction. Nothing should be

determined by accident, hazard, chance or lot. It is, however, very natural that in cases where

there is no ascertained demand, there will often be found a difference of opinion as to the

proper amount to be allowed. It seldom happens that twelve men are found who will at once

agree upon the precise sum, and mutual concessions have to be made before a verdict is

arrived at. Where this difference of opinion exists, and the jurors adopt the method selected inthis case, if each juror marks down the sum which he thinks is correct and right, the result

would fairly express the average judgment of the jury, and this mode RIKDUPRQL]LQJXSRQ

WKHYHUGLFWZRXOGEHMXVWDVSXUHDQGLQQRFHQWDVLIHIIHFWHGE\ZRUGRIPRXWK


of harmonizing upon the verdict would be just as pure and innocent as if effected by word of

mouth.'

In this connection the court in that case quoted with approval the following statement of

Chief Justice Kent: The charge here is not that the jury cast lots whether they should find for

the plaintiff or defendant, but only that, in ascertaining the amount of the damages, they took

the average sum deduced from the different opinions of each other. This has no analogy to the

case of casting lots, or determining by chance for whom they shall find. The liquidation of

damages must always, in a certain degree, be the result of mutual concession, since the

amount of the injury is not susceptible of being ascertained with mathematical precision. If

this mode of collecting the medium of their different opinions was fraudulently abused by any

of the jury, by fixing on a sum intended to be extravagantly high or low, and which was not

given in good faith, it would, perhaps, justify our interference; but no such fraud appears, or

is to be presumed, in the present case. I do not, therefore, think that this mode of ascertainingthe average sum was, in itself, exceptionable, and if, when ascertained, it appeared to the jury

to be a reasonable sum, under all the circumstances of the case, connected with sentiments of

respect and conciliation for each other's opinions, I think it was not improper for them finally

to adopt that sum.

[Headnote 3]

The substance of the statement made by jury foreman Cohen which forms the basis for the

Morse affidavit, was by Cohen's oral testimony under oath developed in greater detail. From

this oral testimony it is apparent that the jurors did not agree in advance to be bound by the

average judgment of the jurors. In fact just the contrary appears. The first 5 or 6 times that an

average amount was determined some of the jurors would not agree to the result. When

$58,000 was computed, that figure was discussed and everybody agreed that they didn't

think this was too much or too little.



18/482

We are of the opinion that the situation presented in this case comes squarely within the

rule expressed in Lee v. Clute, supra. See also Southern Nevada Gold & Silver Min. Co. v.

Holmes Min. Co., 27 Nev. 107, 73 P. 759, 103 Am.St.Rep. 759 (concurring opinion).

[Headnote 4]

In concluding that the lower court acted properly in denying appellants' motion for a new

trial for the reasons stated, and that is the only error assigned on appeal, we do not in any way

imply that the Morse affidavit or the oral testimony of a juror properly can be received in

evidence to impeach the jury's verdict. The case of Southern Nevada Gold & Silver Min. Co.

v. Holmes Min. Co., supra, has settled the law in this state that such evidence is incompetent.

See also the later cases of Close v. Flanary, 77 Nev. 87, 360 P.2d 259; Pinana v. State, 76

Nev. 274, 352 P.2d 824; Priest v. Cafferata, 57 Nev. 153, 60 P.2d 220.

Judgment and order denying new trial affirmed.

Badt, C. J., concurs.

Thompson, J., concurring:

I join in the opinion of the court, but wish to add a comment. This case presents a head-on

collision between two common law rules, and we must choose which one is of the greater

significance in the administration of justice. We have heretofore recognized the rule which

condemns a civil damage verdict reached by means of the quotient process. Lee v. Clute, 10

Nev. 149; So. Nev. M. Co. v. Holmes M. Co., 27 Nev. 107, 73 P. 759. Also, we have

frequently announced and applied the rule, in civil and criminal cases, that a juror will not be

allowed to impeach the verdict returned. State v. Stewart, 9 Nev. 120; State v. Crutchley, 19

Nev. 368, 12 P. 113; So. Nev. M. Co. v. Holmes M. Co., supra; Priest v. Cafferata, 57 Nev.

153, 60 P.2d 220; State v. Lewis, 59 Nev. 262, 91 P.2d 820; Pinana v. State, 76 Nev. 274,

352 P.2d 824; Close v. Flanary, 77 Nev. 87, 360 P.2d 259. The reasons supporting each rule

are well known and need not be restated. It is apparent that in most cases a breach ofWKHGRFWULQHFRQGHPQLQJTXRWLHQWGDPDJHYHUGLFWVFDQEHFRPHNQRZQWRDFRXUWRQO\E\

SHUPLWWLQJDYLRODWLRQRIWKHUXOHDJDLQVWYHUGLFWLPSHDFKPHQWE\MXURUV


the doctrine condemning quotient damage verdicts can become known to a court only by

permitting a violation of the rule against verdict impeachment by jurors. It seems to me thatthe rule against verdict impeachment is of more importance, and must win, when the two

principles come into conflict. This result does not render the rule against quotient damage

verdicts without meaning and substance. That rule may still properly be the basis for an

appropriate jury instruction, if requested by counsel.

____________


19/482

80 Nev. 23, 23 (1964) Department of Highways v. Campbell

THE STATE OF NEVADA, on Relation of Its Department of Highways, Appellant, v.

CECIL G. CAMPBELL and CHARLOTTE CAMPBELL, Husband and Wife, Respondents.

No. 4644

January 31, 1964 388 P.2d 733

Appeal from judgment of the Sixth Judicial District Court, Pershing County; Merwyn H.

Brown, Judge.

Condemnation case. The trial court rendered judgment for condemnees, and condemnor

appealed. The Supreme Court, Badt, C. J., held that awards which were within range of

testimony of condemnee and of condemnor's experts and which amounted to $6,499.76 for

taking of 43.12 acre parcel on highway, $5,795.50 for severing that property, and $65,003.55for taking of land containing certain structures had substantial support in the evidence.

Affirmed.

Harvey Dickerson, Attorney General, Robert J. Potter, Deputy Attorney General,Eli

Grubic, Special Deputy Attorney General, for Appellant.

Goldwater, Taber and Hill, of Reno, for Respondents.

1. Eminent Domain.Value before and after taking and severance damage from taking were fact questions.


2. Eminent Domain.Awards which were within range of testimony of condemnee and of condemnor's experts and which

amounted to $6,499.76 for taking of 43.12 acre parcel on highway, $5,795.50 for severing that property,

and $65,003.55 for taking of land containing certain structures had substantial support in the evidence.

3. Evidence.Condemnee, as owner, was competent to testify as to value of land taken and severance damages.

4. Appeal and Error.Court which sat without jury in case wherein its findings were based on substantial evidence other than

improperly admitted evidence presumably disregarded the improper evidence.

OPINION


This is an appeal taken by the State of Nevada on relation of its Department of Highways


20/482

from that part of the judgment entered by the district court assessing damages against

appellant for its condemnation of parcels of land known as 80-B and 80-C and for severance

of parcel 80-B. Our main concern is with appellant's contention that the trial court's award of

compensation to respondents lacks substantial support in the evidence. We have concluded

that this contention is without merit.

80-B is known as the Rye Patch Ranch. 80C is the parcel of land containing thestructures known as Humboldt House. The taking of 80B was a complete severance. The

parcels of land involved are situate along what was known as Highway 40 between the cities

of Lovelock and Winnemucca, in Pershing County, and had, before the taking, full access

rights to the highway. The parcels were taken by the Nevada Highway Department for the

purpose of constructing an interstate freeway, known as Interstate 80. Certain parts had been

theretofore subject to a right-of-way in the State. The particular taking and construction here

involved was part of a 13-mile project. The federal government required, in FRPSOHWLQJWKLVSURMHFWWKDWWKHDFWXDOIHHEHDFTXLUHGE\WKH6WDWHDQGVXFKZDVWKHSXUSRVHRIWKH

FRQGHPQDWLRQVXLW


completing this project, that the actual fee be acquired by the State and such was the purpose

of the condemnation suit.

Prior to the taking, all parcels here involved had complete access to Highway 40. Interstate

80 has now been completed and fenced off. The parcels involved no longer have access to

such highway.

The case was tried to the court without a jury in April, 1963, and submitted on written

briefs, whereupon the trial court filed a memorandum opinion in which it awarded therespondents damages for the taking of their property as follows:

Parcel 80-A (not involved in this appeal).......................................................... $27.50

Parcel 80-B........................................................................................................ 6,499.76

Parcel 80-C........................................................................................................ 65,003.55

Severance damage from the taking of parcel 80-B and the

construction of the freeway, resulting to the remaining lands of

respondents' Rye Patch Ranch..........................................................

5,797.50

Formal findings followed, together with judgment of condemnation.

[Headnote 1]

The issues before the district court were to determine the value before the taking and the

value after the taking. Virginia & Truckee R. R. Co. v. Henry, 8 Nev. 165. The same applies

to the severance damage. These were questions of fact. Virginia & Truckee R. R. Co. v.

Henry, supra.


21/482

[Headnote 2]

Appellant's two professional witnesses consisted of Calven S. Aerick, its staff appraiser,

and Merton E. Domonoske, professional fee appraiser for appellant. Both of these

witnesses valued part of the land taken in parcel 80-B as adapted to commercial use and

therefore placed its worth at $150 per acre. Campbell was in agreement as to the acreagevaluation.

We refer briefly to the valuation placed by the respective witnesses on the parcels taken by

the State. As to SDUFHO%DSDUWRIUHVSRQGHQWVDFUH5\H3DWFK5DQFKDFUHVRQWKHHDVWVLGHRIWKHKLJKZD\ZHUHWDNHQ


parcel 80-B (a part of respondents' 8,260-acre Rye Patch Ranch), 43.12 acres on the east side

of the highway were taken. (Consideration need not be given to an additional 31.76 acres

comprising a 200-foot-wide easement for a right-of-way for existing Highway 40, already

owned by the State, as the additional vesting of the fee would be of minimal value.) Campbell

considered the entire 43.12 acres to have commercial value. Domonoske accorded

commercial value to 4 acres, Aerick to 6.5 acres. The court accepted Campbell's testimony,

awarding a total of $6,468.1

The severance of parcel 80-B left 9.5 acres landlocked on the west side of the highway.

Aerick valued it at $9 per acre, Domonoske at $8.50 per acre (both characterizing it as

grazing land), and Campbell at $150 per acre, characterizing it as commercial.

As to the severance on the east side of the highway resulting from the severance of parcel

80-B, Aerick allotted a value of $2,500, Domonoske awarded it nothing, and Campbellfigured a loss of 48 acres at $137 per acre. The per acre figure he arrived at by reducing the

$150 per acre commercial value by $13 per acre grazing value, the value of the land after the

taking.

The west side severance and the east side severance produced, according to Campbell, a

loss of $7,837.50. The court awarded $5,797.50.

In valuing parcel 80-C, the Humboldt House itself, Aerick gave to the land involved $350

an acre; Domonoske, $250 an acre. To the improvements, Aerick accorded $38,620;

Domonoske, $33,175. As severance damage, Aerick found none; Domonoske, $4,386.

Campbell refused to particularize, but testified that Humboldt House had a value of $90,000.2

The totals resulted as follows: By Aerick, $39,500; by Domonoske, $38,150; by Campbell,$90,003.55; by the court $65,003.55.

____________________

1

Plus allowance of $31.76, the only additional damage for the taking of the underlying fee on 31.76 acres

over which the State had an existing easement for a right-of-way for Highway 40.


22/482

2

Plus allowance of $3.55, the only additional damage for the taking of the underlying fee on 3.55 acres over

which the State had an existing easement for a right-of-way for Highway 40.


Not only are there serious contradictions in the testimony of the State's two expert

witnesses, as noted above, which may indeed have influenced the court in its rejection of their

testimony, but they also differed in their approach or method of evaluation. Aerick testified,

Well, in appraising, our office used the three approaches to value: the market approach, the

cost approach, and the income approach. He then indicated that he considered the cost

approach as the final approach. This is determined by finding actual cost less depreciation.

The market approach was defined by the witness as finding sales of comparative properties,

and valuing the subject property by comparison. (Incidentally, we note here that this appears

to be precisely what the witness Campbell didfinding the most comparable sale to be of the

Buena Vista property and the conclusion that Humboldt House was worth twice Buena

Vista.) He then defined the income approach as the processing of income which the property

will earn by capitalization into a value which you can use. He said this method has

hazardous elements, but you use it to correlate the cost and the market approach.

He arrived, as above indicated, using his three methods of approach, at a total value,

including severance damages, of $39,500. In applying the compensation approach or income

approach he capitalized income at 9 percent per annum, being 7 percent income and 2 percent

return of capital. On cross-examination he testified that at 4 percent the value would be

capitalized at $69,850, but the witness stated, I would never use 4%. At 5 percent the value

would be capitalized at $55,880. (Later he corrected his figures to show that, capitalized at 4

percent, the value would appear to be $72,110, and, at 5 percent, $58,140.) This was histestimony taken at the trial in April, 1962. In a preliminary statement made on March 19,

1961, the witness had indicated that for roadside commercial properties replacement cost less

depreciation, plus the land value, should be used. The witness then stated:

In order to in any way approximate a value indicated by the cost approach, the expected

return on the land DQGLPSURYHPHQWVZRXOGKDYHWREHFXWWRDSSUR[LPDWHO\ILYHSHUFHQW


and improvements would have to be cut to approximately five percent. Due to the lack of

rents or leases on comparable roadside property, there was insufficient data to adequately

establish such a cap' rate. Thus it can be stated that it appears there is a market for such

roadside businesses and certain people will operate them usually on an owner-operator basis

taking less for their labor and investment but being certain of a regular income and reduced

living expenses.

The market approach was not used at all by the witness at that time.


23/482

Thus, appellant introduced the capitalization-of-income method into the case. Domonoske

did not use this approach at all. It will be noted that the capitalization approach, at 5 percent

or at 6 percent testified to by Aerick on cross-examination, closely approximates the value

found by the court.

In State v. Shaddock, 75 Nev. 392, 344 P.2d 191, after evidence that the condemned land

produced $3,600 a year in rentals and that just compensation would be a sum sufficient toproduce an income of $3,600 a year, this court held that it was proper to permit a witness to

testify relative to the value of an asset capable of producing such income and said: Such

evidence was given by an expert and was solely for the purpose of assisting the jury in

determining the value of this asset. Appellant's witnesses themselves capitalized the net

income in arriving at market value from the income approach, using a different capitalization

rate. It was within the province of the jury to decide what rate if any to use after considering

all of the evidence relating thereto and the reasons given for the various conclusions.

Campbell was a member of the Board of County Commissioners of Pershing County for

10 years. He was a director of the County Commissioner Association of the Western States

and for the past 2 years was president of that association. He testified that he was familiar

with land values in Pershing County; that he had made it a practice to study these land valuesand he familiarized himself with land values in Pershing &RXQW\WKURXJKFKHFNLQJZLWKWKHRZQHUVDQGWKHVHOOHUVDQGWDONLQJWRWKHPDQGWKURXJKFRQYHUVDWLRQVZLWKWKHSXUFKDVHUVWKDWKHKDGDQRSLQLRQDVWRWKHPDUNHWYDOXHRI+XPEROGW+RXVHEHLQJ

SDUFHO&LQYROYHGLQWKLVSURFHHGLQJ


County through checking with the owners and the sellers and talking to them and throughconversations with the purchasers, that he had an opinion as to the market value of Humboldt

House, being parcel 80-C involved in this proceeding. His opinion as to such market value

was $90,0003 as indicated in the list above.

As a member of the Board of County Commissioners he was for 10 years a member of the

County Board of Equalization, which dealt directly and exclusively with land and other

values for purposes of taxation. NRS 361.340, 361.345.

As to the severed parcel of land on the west side of the highway comprising 9.5 acres, the

witness testified that it was completely isolated. It became of no use to him whatsoever. I

cannot get to it. There is no frontage road to it. I have no access to it after the freeway is put

in there. I cannot put water on it, livestock or anything else. I would have to trespass over

private-owned land to get to that area. * * * You cannot get to it from the freeway after it isconstructed * * *. You can only get off the freeway at two points, and then I would have to

trespass over private-owned land to go to that 8.41 acres.[ 4 ] I put a valuation on it of $150 an

acre, or a total valuation on the parcel of $1,261.50.

As to the damage resulting from the remaining land by the severance of the parcel just east

of the highway, he testified: The price I set on it is $6,576 and I will explain it in this way.

At $150 per acre, and there is approximately, taken from the maps as close as we can figure,


24/482

there is 7,100 feet of frontage. * * * So taking the frontage, the runs and parcel, and that is

Parcel 80-B on the east side and where it ends, figuring a depth of 400 feet which has

commercial value, and the highway is taking 100 feet off of that, approximately, leaving me

300 feet of what I call a business area, and commercial ground, and taking that and

multiplying that by the frontage and [arriving at] 48 acres plus in round figures, I figured 48

acres was left in that tract RIJURXQG

____________________

3

See footnote 2, supra.

4

Early testimony identified the area as 8.41 acres, but it was later established that the area was 9.5 acres.


of ground. * * * That is took out of the commercial basis and put onto grazing ground. The

way I come to this figure is I took 48 acres times the prevailing price that I have used for my

grazing ground of $13 and subtracted it from the ground that I figured for the full 400 feet

and that gave me the figure of $6,576.

The original Humboldt House was adjacent to the yards of the Southern Pacific Company.

After Highway 40 was constructed, in 1926, Campbell, his father, and brothers razed the old

Humboldt House and moved up to the highway and it has been operated there ever since.

Mr. and Mrs. Campbell and their three children lived there, and operated a general

merchandise business, including a bar, service station and garage, grocery store, hardware.

Cabins and trailers were for rent. They served gold mining property in the vicinity. Peoplefrom every walk of life came back again and again to meet at Humboldt House. It had a good

firm tourist trade, and its reputation persisted after Highway 40 was put in. Many people

came there on account of its good water supply. They had a dug well that had never been

pumped dry, which filled a 4,000-gallon redwood tank to establish pressure.

On cross-examination, in response to the question, Will you tell us how you arrived at the

$90,000 figure [for parcel 80-C, Humboldt House]? the witness testified without objection,

I had a $100,000 offer in 1959 and a $65,000 offer in 1947. He testified by whom these

offers were made and then continued: And I have studied sales of real estate, places and

parts in Pershing County and that is how I set my figure on the worth of my buildings. * * * I

studied real estate values over a period of time and the different transactions, real estate, inpart, through Pershing County, and the acreage overand the businesses that were sold in

that county, and that is how I derived the figure on my house and place of business. Asked

for further details, he referred to the Buena Vista sale. It took place five times since the

original. It has sold for $45,000. I do not figure there is any comparison to mine, because that

place has no record [no such general reputation, DQGEHFDXVHRIWKHEHWWHUZDWHUVXSSO\DW+XPEROGW+RXVH@


25/482


and because of the better water supply at Humboldt House]. He answered further detailed

questions on cross-examination as to the purchasers and sellers, etc.Appellant insists that the awards made by the court are unsupported by any substantial

evidence. We are unable to agree with this contention.

Appellant's brief concludes: Appellant does not question the competency of an owner of

land to testify to its value, but believes that the credibility of such testimony should not

summarily equate with its competency. (Emphasis supplied.) But credibility by whom? In

oral argument appellant urged that Campbell's testimony was not entitled to any weight. But

this court has never looked at the scales over the trial judge's shoulder to determine whether

the fact finder correctly read the weight.

[Headnote 3]The competency of respondent to testify, as admitted by appellant, was firmly established

in State ex rel. Dept. Highways v. Olsen, 76 Nev. 176, 351 P.2d 186. Appellant points out,

however, that in that case respondent had owned the property for 10 years, owned other

business properties in Reno and leased the same, was aware of market values of her own and

surrounding properties, and compared recent sales of nearby land. We have above outlined

Campbell's experience and background. It is entirely unnecessary for us to consider whether

he was better or less qualified to testify than Mrs. Olsen in State v. Olsen, supra. In short,

appellant's contention fails to recognize the function of this court. When it speaks of the

weight to be given to the testimony of certain witnesses, it can refer only to the weight to be

given to it by the trial court. When it states that credibility should or should not be accorded

to the testimony of a witness, it addresses itself to the credibility to be accorded by the trier ofthe facts. There indeed may be certain exceptions which are not applicable here and which are

not necessary to discuss. The record discloses that the learned trial judge was alert to all of

the issues presented, to the contentions of the parties, and the testimony of the witnesses. In

State v. Pinson, 66 Nev.


227, 207 P.2d 1105, in which the condemnees appealed from an award which they consideredinadequate, this court said: We are, in effect, asked to say that the trial court was in error in

accepting the testimony of respondent's witnesses rather than the testimony of appellants and

their witnesses. This we cannot do. We have no difficulty in concluding that there was

substantial evidence to support the court's findings and judgment.

In United States v. Certain Lands, Etc., 3 Cir., 183 F.2d 320, United States Circuit Court

of Appeals remarked: Finally, it is difficult to see that clear error exists, for the evidence of

value was highly conflicting and the compensation awarded is within the range of evidence.


26/482

This court in Virginia & Truckee R. R. Co. v. Henry, 8 Nev. 165, in sustaining a

condemnation award having to do mainly with severance damage, said: The district court

saw that there was substantial testimony [in the report of the commissioners] to sustain the

award, and that all such said to have been omitted could not touch the issue. In that case the

court rejected the contention that the measure [of the damage] is filled by giving the private

person the market value of the land taken. The court held that the restriction of theallowance to the naked market value of the property taken, would violate the constitutional

requirement for just compensation. The court further stated: It is difficult to imagine an

unjust compensation; but the word just' is used evidently to intensify the meaning of the

word compensation;' to convey the idea that the equivalent to be rendered for property taken

shall be real, substantial, full, ample; and no legislature can diminish by one jot the rotund

expression of the constitution. * * * [As to] the absolute protection of the individual by just

compensationthere has been, could be, no dispute.

[Headnote 4]

One additional error is asserted by appellant. Respondent was asked: How much would

you have to get from the property to support yourself and your family? $SSHOODQWREMHFWHGFLWLQJ1LFKROV(PLQHQW'RPDLQDQG$P-XU


Appellant objected, citing 5 Nichols, Eminent Domain 19.3(1) and 18 Am.Jur., Eminent

Domain 345, to the effect that evidence of profits derived from a business conducted on the

property is too speculative, uncertain and remote to be considered as a basis for computing

market value in condemnation proceedings. This does indeed appear to be the rule. However,this court has consistently held that where inadmissible evidence has been received by the

court, sitting without a jury, and there is other substantial evidence upon which the court

based its findings, the court will be presumed to have disregarded the improper evidence.

Alamo Airways, Inc. v. Benum, 78 Nev. 384, 374 P.2d 684.

We find no error, and are of the opinion that the judgment should be sustained on the

authority of State ex rel. Dept. Highways v. Olsen, 76 Nev. 176, 351 P.2d 186.

Affirmed with costs.

McNamee and Thompson, JJ., concur.

____________

80 Nev. 33, 33 (1964) Toth v. Toth

JANE H. TOTH, Appellant and Cross-Respondent, v. FRANCIS A. TOTH,

Respondent and Cross-Appellant.


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No. 4651

February 5, 1964 389 P.2d 73

Cross-appeals from an order of the Seventh Judicial District Court, White Pine County;

Jon R. Collins, Judge.

Proceeding upon divorced husband's motion to modify custody decree entered in divorce

action as to parties' three minor children. The trial court modified the former custody decree,

and divorced wife appealed. The divorced husband cross-appealed. The Supreme Court, Badt,

C. J., held that award of main custody to divorced father and of part time custody to divorced

mother was not an abuse of trial court's discretion.

Judgment and order affirmed.

80 Nev. 33, 34 (1964) Toth v. Toth

E. R. Miller, Jr., of Ely, for Jane H. Toth.

Gray and Horton, of Ely, for Francis A. Toth.

1. Divorce.Modification of custody decree so that divorced father, instead of mother, would have custody, subject to

mother's right to custody during summer months, with father providing transportation costs and support

was not an abuse of discretion, where mother had, for about a year after the divorce, carried on an illicit

affair with another man. NRS 125.140, subds. 1, 2.

2. Divorce.Award of part time custody of parties' minor children to divorced wife was not an abuse of trial court's

discretion, even though wife had, for about a year after divorce, carried on an illicit affair with another

man, where trial court did not consider it best for children's interests that they be deprived of mother's love,

care, and attention during the three summer months. NRS 125.140, subds. 1, 2.

OPINION


The sole question presented by these cross-appeals is whether the court below was guilty

of an abuse of discretion in modifying its former decree which awarded the custody of three

minor children to the mother. We have concluded that there was no abuse of discretion. The

parties will be referred to by their names.

On May 22, 1961, Jane obtained a default decree of divorce from Francis, in which decree

she was awarded full custody of the three minor children, then of the respective ages of 7

years, 5 years, and 2 months. On April 25, 1963, the court, upon motion of Francis to modify

the decree and pursuant to an extensive hearing on such motion and the introduction of oral

testimony and sundry depositions, made an order modifying the decree by awarding to


28/482

Francis, the father, custody of the three children during the 9 school months of each year and

awarding to the mother, Jane, their custody during the 3 summer-vacation months. As a

condition for the granting of Francis' motion, the court ordered that he pay $150 a month for

the support of the children while they were in the custody of the mother, that he pay the cost

of transportation of the FKLOGUHQIURP1HYDGDWR1HZ-HUVH\DQGOLNHZLVHIURP1HZ-HUVH\

WR1HYDGDLQFRPSOLDQFHZLWKWKHFRXUWVRUGHUDQGWKDWKHSRVWDERQGLQWKHVXPRIIRUHDFKFKLOGFRQGLWLRQHGXSRQWKHSHUIRUPDQFHE\KLPRIWKHVHUHTXLUHPHQWV

80 Nev. 33, 35 (1964) Toth v. Toth

children from Nevada to New Jersey, and likewise from New Jersey to Nevada, in

compliance with the court's order, and that he post a bond in the sum of $1,000 for each child,

conditioned upon the performance by him of these requirements. The order provided that it

go into effect commencing with the fall school term in 1963. It further restrained Jane from

removing the children from the jurisdiction of the court and ordered her to deliver thechildren to the father 1 week before school starts in the fall of each year in the State of New

Jersey, commencing with the fall of 1963.

On May 24, 1963, Jane appealed from the order modifying the decree as to custody, and 3

days later Francis appealed from the order insofar as it refused to award him full custody.

Jane specifies as error (1) that the court abused its discretion in making the order changing

custody in view of a finding by the court that the mother's affairs with the man whom she

expected to marry did not appear to have affected the children; (2) that the court abused its

discretion in making the change of custody from the mother in Nevada to the father in New

Jersey on the ground that the children in New Jersey would have an opportunity for better

housing and better all-around circumstances than available in Ely, Nevada; (3) that, basedupon the implied finding that the mother was a fit person to have custody for 3 months of

each year, it was an abuse of discretion to change the custody from her to the father for 9

months of each year.

Francis specifies simply: (1) that the court erred in awarding part-time custody to Jane; and

(2) that it erred in not awarding full-time custody to Francis.1 ,WLVFOHDUWKDWWKHFRXUWEDVHGLWVRUGHUXSRQWKHXQGHQLHGVKRZLQJWKDWIRUDERXWD\HDUDIWHUWKHGLYRUFH-DQH

FDUULHGRQDQLOOLFLWDIIDLUZLWKDQRWKHUPDQ

____________________

1

The power of the district court is found in the provisions of NRS 125.140, which reads:

1. The court, in granting a divorce, shall make such disposition of, and provision for, the children,

as shall appear most expedient under all the circumstances, and most for the present comfort and future

well-being of such children.

2. In actions for divorce the court may, during the pendency of the action, or at the final hearing or

at any time thereafter during the minority of any of the children of the marriage, make such order for the

custody, care, education, maintenance and support of such minor children as may seem necessary or

proper, and may at any time modify or vacate the same.


29/482

80 Nev. 33, 36 (1964) Toth v. Toth

It is clear that the court based its order upon the undenied showing that for about a yearafter the divorce Jane carried on an illicit affair with another man. She had sexual relations

with him approximately once a week, generally on Saturday nights. She also had dates with

some six other men, although she denies having had sexual relations with any of these others.

The evidence is in dispute whether such relations were had with one of these other men. In

frankly admitting her relations with the one man for almost a year, she justifies this by the

statement that they each had affection for the other and had contemplated being married, and

that when they had finally concluded that there were obstacles against a successful marriage,

they had entirely ceased their relations. Although witnesses testified in general to her good

character and her care and schooling of the children, she admitted to indulgence in

intoxicating liquors, but maintained that only on one occasion was she drunk.

In Jane's opening brief, her attorney frankly states:

Both parties obviously love their children. The husband is well fixed financially. He has a

large home, a successful business and owns considerable property in New Jersey. C. E.

Horton, Mr. Toth's attorney, flew from Ely to New Jersey and obtained the depositions of

numerous persons who knew Mr. Toth, all of whom testified as to his excellent character,

particularly with regard to his religious preoccupation.

In this connection the court said in its decision: The mother will be granted custody of the

children during the summer portion of each year. The placement of the children is in the

father's custody, however, and the Court finds that is in the best interest of the children that

they be permitted to go to school in New Jersey, where they have an opportunity for better

housing and better all around circumstances than is available in Ely, Nevada. I do not want todeprive the mother of her interest in the children. However, Mrs. Toth, the Court tells you

point-blank, unless your conduct improves then certainly further consideration might well be

given to modifying this order further. Because I simply cannot approve of your conduct up to

this point; there is no ZD\,FDQGRLWQRUDQ\RWKHU&RXUW

80 Nev. 33, 37 (1964) Toth v. Toth

way I can do it, nor any other Court. It does not appear to have affected the children up to thispoint. It has had some effect, but no severe effect up to this point. I do not feel the immediate

best interests of the children is served by uprooting them from their present circumstances

provided, of course, Mrs. Toth, your conduct is such that the children are not harmed further

as by the past activities on your part as have been testified by you. The modified Decree, so

far as the custody of the children is concerned, is conditioned upon these circumstances.

The court emphasized its realization that its one obligation was to make such order as was

in the best interests of the children. It recited that it could not condone the plaintiff's conduct;


30/482


31/482

80 Nev. 39, 39 (1964) Coray v. Hom

OSCAR CORAY and LEONA F. CORAY, Appellants, v. BEN HOM and IDA HOM, BILLYOUNG YEE and SARAH JANE YEE, EROS C. ZOTALIS and ESTHER H. ZOTALIS,

EDWARD S. GAWLIK and JESSLYN E. GAWLIK, and SUE YEE,

as Individuals and B & B Company, a Copartnership, Respondents.

No. 4659

February 5, 1964 389 P.2d 76

Appeal from a judgment of the First Judicial District Court, Douglas County; Frank B.

Gregory, Judge.

Action to compel buyers to specifically perform. After both sides had put in their

cases-in-chief, the trial court rendered summary judgment for defendants and plaintiffs

appealed. The Supreme Court, Thompson, J., held that as statute of frauds was not in issue

since it had not been pleaded affirmatively but was attempted to be injected by summary

judgment motion erroneously made at close of plaintiffs' case-in-chief, court should not have

decided case on basis of summary judgment motion after both sides had put in their

cases-in-chief, but case had become one of conflicting evidence and should have been

determined on that basis.

Reversed and remanded.

John Tom Ross and Theodore H. Stokes, of Carson City, for Appellants.

William J. Crowell, of Carson City, and Francis B. Dillon, of Sacramento, California, for

Respondents.

1. Frauds, Statute of.

Failure to plead statute of frauds affirmatively constituted waiver of defense. NRCP 12(b, h), 56(b).

2. Judgment.

Summary judgment procedure was not available at close of plaintiffs' case-in-chief. NRCP 56(b).

3. Judgment.

Summary judgment procedure is to be utilized before trial, not during or after trial.

4. Judgment.As statute of frauds was not in issue since it had not been pleaded affirmatively but was attempted to be

injected by summary judgment motion erroneously made at close of plaintiffs' FDVHLQFKLHIFRXUW

VKRXOGQRWKDYHGHFLGHGFDVHRQEDVLVRIVXPPDU\MXGJPHQWPRWLRQDIWHUERWKVLGHVKDGSXWLQWKHLUFDVHVLQFKLHIEXWFDVHKDGEHFRPHRQHRIFRQIOLFWLQJHYLGHQFHDQGVKRXOGKDYHEHHQGHWHUPLQHGRQWKDWEDVLV


32/482

80 Nev. 39, 40 (1964) Coray v. Hom

case-in-chief, court should not have decided case on basis of summary judgment motion after both sides

had put in their cases-in-chief, but case had become one of conflicting evidence and should have beendetermined on that basis.

5. Principal and Agent.Testimony of asserted agent as to his authority in consummating, contract of sale was competent.

OPINION

By the Court, Thompson, J.:

This is an action by the sellers of real property (the Corays) to compel the alleged buyers

(Hom and others) to specifically perform their contract to purchase, or, in the alternative, to

pay damages. The buyers won in the trial court and the sellers appeal.

[Headnotes 1-5]

The case is loaded with procedural blunders. Halfway through the trial the buyers decided

to rely upon the statute of frauds as a defense to the sellers' claim for relief. Their pleadings

did not mention the statute. Having failed to plead the statute of frauds as an affirmative

defense as required by NRCP 8(c), they sought to introduce it by way of a motion for

summary judgment at the close of the sellers' case-in-chief. Of course, their failure to plead it

affirmatively constituted a waiver. NRCP 12(b) (h); Chisholm v. Redfield, 75 Nev. 502, 347

P.2d 523. Nor was the summary judgment procedure available at that juncture. That

procedure is to be utilized before trial, not during, or after trial.1 Its purpose is to avoid a

needless trial when an appropriate showing is made in advance that there is no genuine issueof fact to be tried, and the movant is entitled to judgment as DPDWWHURIODZ

____________________

1

The buyers seize upon three words at any time as used in NRCP 56(b) to justify their late motion. Both

the purpose of the summary judgment procedure and a careful reading of the entire rule make it evident that

those three words mean at any time before trial. Other motions are available during trial, and following trial.

80 Nev. 39, 41 (1964) Coray v. Hom

a matter of law. Instead of denying that motion as unauthorized, the court listened to

arguments, and reserved ruling; whereupon the buyers (defendants) put on their case-in-chief.

Approximately 7 months later, the case was reopened to permit the sellers (plaintiffs) to

introduce further evidence, after which the matter was submitted to the court for decision.

More than a year passed before the court ruled. Instead of deciding the case on the merits, it


33/482

granted the buyers' motion for summary judgment. This should not have been done. As the

statute of frauds was not an issue for the reasons already mentioned (and we intimate no view

as to whether that defense would have been good had it been properly advanced), the case

became one of conflicting evidence concerning the scope of authority, if any at all, granted to

a Mr. Cutler, to act as the agent for the buyers in consummating the contract of sale. 2 Cutler

testified (somewhat ambiguously) that he had such authority. This testimony was competent.Schlitz Brewing Co. v. Grimmon, 28 Nev. 235, 250, 81 P. 43, 46. Mr. Hom, one of the

alleged buyers and principals, stated unequivocally that Cutler was not authorized to purchase

the property for him. The other alleged buyers did not testify. Diverse inferences could be

drawn from the documentary evidence produced. On this record, we must reverse the

summary judgment, and remand the case with the direction to decide it on the merits without

any consideration being accorded the purported defense of the statute of frauds which was

waived before the trial started. It is so ordered.

Badt, C. J., and McNamee, J., concur.

____________________

2

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