Aronoff v. Katleman

345 P.2d 221, 75 Nev. 424, 1959 Nev. LEXIS 168
CourtNevada Supreme Court
DecidedOctober 26, 1959
DocketNo. 4223
StatusPublished
Cited by3 cases

This text of 345 P.2d 221 (Aronoff v. Katleman) is published on Counsel Stack Legal Research, covering Nevada Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Aronoff v. Katleman, 345 P.2d 221, 75 Nev. 424, 1959 Nev. LEXIS 168 (Neb. 1959).

Opinion

[425]*425OPINION

By the Court,

Pike, J.:

Appeal from an order of the trial court granting a preliminary injunction enjoining appellant from declaring a default on, negotiating, or bringing any attachment proceeding with reference to a certain promissory note executed by plaintiff.

Appellant Aronoff (defendant below) is hereinafter referred to as Aronoff, and respondents Katleman, El Raneo, Inc., a Nevada corporation, and El Raneo Hotel Operating Co., a Nevada corporation (plaintiffs below) are referred to as Katleman. Katleman controls the two respondent corporations.

Prior to January 1, 1958 Katleman had been the sole owner of El Raneo Hotel Operating Co., a corporation, [426]*426which operated the El Rancho Vegas Hotel in Las Vegas, including its gambling, restaurant and bar. On January 1, 1958 Aronoff paid Katleman $500,000 for a one-half interest in said El Raneo Hotel Operating Co. By written agreement dated April 1,1958 Katleman agreed to repay the $500,000 to Aronoff for the return of the one-half interest, less one-half the amount of the operating losses for the period from January 1, 1958 to April 1, 1958. Aronoff was also to be credited for any profits accruing from revenue during the remainder of 1958. It was agreed that the amount of the operating losses and of any profits during the periods indicated were to be ascertained by accountants engaged by the respective parties.

On April 29, 1958 the accountants made a partial accounting to the parties covering the first three months of 1958 showing an operating loss for that period of $292,658.01 plus $4,875, plus an undetermined insurance expense.

On February 16, 1959 Aronoff sued Katleman for $398,369 as the amount claimed to be due and unpaid to him pursuant to the agreement and caused an attachment to be levied against Katleman’s property. The attachment halted the operations of El Rancho Vegas Hotel. Aronoff and Katleman and their counsel conducted negotiations as a result of which Aronoff caused the attachment to be released on February 18, 1959. In connection with such negotiations on the same date Katleman delivered to Aronoff a non-interest bearing negotiable promissory note in the sum of $315,869, which provided for monthly installment payments and acceleration of the entire balance at the option of the holder in the event of default of any payment. Concurrently the parties entered into a written agreement giving Aronoff the right to waive the security of a deed of trust given to secure payment of the promissory note and to avail himself of all remedies provided by law in connection with the enforcement of the payment of said note. Katleman also paid the sum of $100,000 to Aronoff and canceled certain other indebtedness claimed to be owed him by Aronoff.

[427]*427The suit brought by Aronoff was not dismissed, and the attachment bond for more than $90,000 remains on file with the clerk of the trial court conditioned that Aronoff will pay all costs awarded to Katleman and all damages which may have been sustained by him by' reason of the attachment.

Katleman thereafter made the $25,000 payment due on the note on April 1, 1959 and similar payments in like amount on May 1 and June 1, 1959. However, prior to a $50,000 payment becoming due on the note on July 1, 1959 Katleman commenced the present suit. Katleman’s first amended and supplemental complaint against Aronoff was filed on June 16, 1959. Among other things it alleged that Katleman executed and delivered to Aronoff the promissory note and accompanying documents by reason of duress and business compulsion. Such complaint further alleged the written agreement between the parties of April 1, 1958, the partial accounting for the three months’ period ending March 31, 1958, the halting of the hotel operations through the attachment suit brought by Aronoff on February 16, 1959, the expenses incurred by Katleman during the three days that the hotel operations were stopped by the attachment, and the negotiations between the parties including the payment of $100,000, and the delivery to Aronoff by Katleman of the promissory note and the other considerations already referred to.

The complaint also alleges that, under the partial accounting made, the one-half of the operating loss of the first three months of 1958 chargeable to Aronoff amounts to $232,464.78 and that such sum should be credited against the $500,000 owed to Aronoff by Katleman. The complaint further alleges additional amounts claimed to be due to Katleman or the respondent corporations, sums covering hotel bills totaling $11,404.36, $8,000 due Katleman from Aronoff since October 1, 1958 (the basis of which indebtedness is not alleged) and alleges items of $7,500 and $3,000 as attorney’s fees paid on Aronoff’s behalf in 1958.

Additional allegations of the complaint are that El Raneo Hotel Operating Co. suffered an immediate oper[428]*428ating loss of $38,104.94 by reason of the attachment. In addition, damage to the general business reputation and good will of such corporation is alleged in the amount of $150,000 and punitive damages for $100,000 are sought. The complaint alleges that the amount of the promissory note does not correctly state the balance owed by Katleman to Aronoff, alleges the payment of the $100,000 and the three monthly payments of $25,000 each made on the note in order to avoid a repetition of the attachment proceedings, and alleges that a controversy exists which should be expeditiously adjudicated by the court and prays “that the court adjudicate and declare the true balance, if any, owing by and to the parties,” and for special, general and exemplary damages and for general relief. No injunctive relief was sought at the time that Katleman’s complaint was filed.

Aronoff’s answer was filed June 18, 1959 which, among other things, specifically denied that Aronoff owed any of the sums sought in Katleman’s complaint, and that any of the payments made by Katleman were made in order to avoid repetition of attachment proceedings, and denies that there is a controversy as to the true balance of the promissory note. As a matter of affirmative defense it alleges Katleman’s refusal to comply with the agreement of April 1, 1958, the bringing of the attachment suit and its dismissal in consideration of the delivery of the promissory note, and the payment of the other considerations by Katleman to Aronoff. Certain counterclaims are likewise asserted by Aronoff which allege conditions under which Aronoff paid the $500,000 to Katleman and the circumstances which caused him to request its return and the negotiations leading to the execution by the parties of the agreement of April 1,1958 which Aronoff alleges he would not have executed except for duress and business compulsion asserted against him by Katleman.

The second counterclaim alleges the agreement and exchange of valuable considerations by the parties of February 18, 1959 and the bringing of the present suit after such compromise and settlement of differences [429]*429between the parties. Aronoff asks that the judgment be given against Katleman for the sums found to be due to Aronoff and for damages in the sum of $100,000 occasioned by the bringing of the present suit by Katleman.

On June 26, 1959 Katleman filed his motion for preliminary injunction supported by his affidavit. Aronoff filed a motion to quash such application, which motion was supported by Aronoff’s affidavit.

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Cite This Page — Counsel Stack

Bluebook (online)
345 P.2d 221, 75 Nev. 424, 1959 Nev. LEXIS 168, Counsel Stack Legal Research, https://law.counselstack.com/opinion/aronoff-v-katleman-nev-1959.