Justia Nevada Supreme Court Opinion Summaries

The United States Bankruptcy Court for the District of Nevada certified three questions of law to the Supreme Court regarding the mechanic’s lien priority law, specifically, the visible-commencement-of-construction aspect of the law, which states that a mechanic’s lien takes priority over other encumbrances on a property that are recorded after construction of a work of improvement visibly commences. The Supreme Court answered (1) the Court’s holding in J.E. Dunn Northwest, Inc. v. Corus Construction Venture, LLC does not preclude a trier of fact from finding that grading property for a work of improvement constitutes visible commencement of construction; (2) the contract dates and permit issuance dates are irrelevant to the visible-commencement-of-construction test, even in this case where dirt material was placed on a future project site before building permits were issued and the general contractor was hired; and (3) the Court declined to answer the third certified question because it asked the Court to make findings of fact that should be left to the bankruptcy court. View "Byrd Underground, LLC v. Angaur, LLC" on Justia Law

David and Kelli Nilsson, who were divorced, held a half interest in certain property in Reno as tenants in common. After the divorce, Kelli and the parties’ children lived on the property, and David lived elsewhere. Several years later, David filed for bankruptcy. On his schedule of real property assets, David claimed an interest in the Reno property as half-owner with Kelli. David then claimed the property as exempt from inclusion in his bankruptcy estate based in part on the homestead exemption. The bankruptcy trustee (Trustee) objected to the claimed exemption because David did not reside on the Reno property, David did not record a declaration of homestead, and David could not now record a valid declaration of homestead on the property. David responded that he could claim the exemption because his children still lived on the property. The bankruptcy court certified a question to the Nevada Supreme Court without ruling on the Trustee’s objection. The Court answered that a debtor must actually reside on real property in order to claim properly a homestead exemption for that property. View "In re Nilsson" on Justia Law

Wife filed for Chapter 7 bankruptcy relief. Husband did not join in the bankruptcy petition or file a separate petition for relief. Under bankruptcy law, the bankruptcy estate includes all of the marital community property. Wife claimed exemptions for two motor vehicles and property worth over $1,400, all of which was community property. The Trustee filed an objection on the grounds that a debtor spouse may exempt only a single vehicle and property worth no more than $1,000 under Nev. Rev. Stat. 21.090(1), and a non-debtor spouse has no right to claim any exemptions in a debtor spouse's bankruptcy. The U.S. Bankruptcy Court overruled the Trustee's objection, determining that Nevada law allows a debtor to claim motor vehicle and wildcard exemptions on behalf of a non-debtor spouse. The Trustee appealed to the Bankruptcy Appellate Panel, which certified a question to the Nevada Supreme Court. The Supreme Court held that, based on section 21.090(1)(f) and (z)'s plain language, Nevada law does not allow debtors to claim motor vehicle and wildcard exemptions on behalf of their non-debtor spouses, and therefore, a judgment debtor in Nevada is limited to one motor vehicle exemption an other personal property exemptions not to exceed $1,000. View " In re Fox" on Justia Law

This case arose when debtor Fontainebleau Las Vegas Holdings, LLC filed for bankruptcy while seeking to construct and develop and $2.8 billion hotel-casino resort. The U.S. Bankruptcy Court certified questions to the Nevada Supreme Court relating to the viability of equitable subrogation and the enforceability of contractual subordination against mechanic's lien claimants under Nevada's mechanic's and materialman's lien statutes. The Supreme Court answered (1) the doctrine of equitable subrogation does not apply against mechanic's lien claimants, such that a mortgage incurred after the commencement of work on a project will not succeed to the senior priority position of a preexisting lien satisfied by the mortgagee if intervening mechanics' liens exist; and (2) contractual subordination agreements executed by mechanic's lien claimants purporting to subordinate mechanic's liens prospectively are not enforceable, but mechanic's lien claimants may waive their statutorily protected rights when the precise requirements of Nev. Rev. Stat. 108.2457 are met. View "In re Fontainebleau Las Vegas Holdings, LLC" on Justia Law

A casino-hotel filed for bankruptcy. Appellant, the administrative agent for a syndicate of lenders that loaned money to the casino's developers, and Respondents, contractors, subcontractors, and suppliers who asserted statutory liens against the property, entered into a dispute over the priority of their respective liens on the property. The Supreme Court accepted questions certified to it from the bankruptcy court regarding the application of contractual subordination, equitable subordination, and equitable subrogation in the context of a mechanic's lien. Appellant moved to strike Respondents' appendix, contending that the included documents contained information beyond the facts certified to the Court by the bankruptcy court. Respondents opposed the motion, arguing that the additional information was necessary for the Court's understanding of the certified legal questions. The Supreme Court granted the motion to strike after determining that Respondents' appendix was filed solely to contradict the certification order and the complaint, holding that while an appendix may be filed to assist the Court in understanding the matter, it may not be used to controvert the facts as stated in the certification order. View "In re Fontainebleau Las Vegas Holdings" on Justia Law