Lehrer McGovern Bovis v. BULLOCK INSULATION

185 P.3d 1055, 2008 WL 2374249
CourtNevada Supreme Court
DecidedJune 12, 2008
Docket45618, 45860, 45898
StatusPublished

This text of 185 P.3d 1055 (Lehrer McGovern Bovis v. BULLOCK INSULATION) 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
Lehrer McGovern Bovis v. BULLOCK INSULATION, 185 P.3d 1055, 2008 WL 2374249 (Neb. 2008).

Opinion

185 P.3d 1055 (2008)

LEHRER McGOVERN BOVIS, INC., Appellant,
v.
BULLOCK INSULATION, INC., A Nevada Corporation; and Insurance Company of the West, Respondents.
Lehrer McGovern Bovis, Inc., Appellant,
v.
Bullock Insulation, Inc., A Nevada Corporation; and Insurance Company of the West, Respondents.
Venetian Casino Resort, LLC; Grand Canal Shops Mall Construction, LLC; and National Union Fire Insurance Company of Pittsburgh, PA, Appellants,
v.
Bullock Insulation, Inc., Respondent.

Nos. 45618, 45860, 45898.

Supreme Court of Nevada.

June 12, 2008.

*1057 Harrison, Kemp, Jones & Coulthard, LLP, and Richard F. Scotti, Las Vegas, for Appellant Lehrer McGovern Bovis.

Weinberg, Wheeler, Hudgins, Gunn & Dial, LLC, and D. Lee Roberts, Jr., David J. Larson, and Rosemary Missisian, Las Vegas, for Appellants Venetian Casino, Grand Canal Shops Mall Construction, National Union Fire Insurance Company, and Lehrer McGovern Bovis.

Kummer Kaempfer Bonner Renshaw & Ferrario and Mark E. Ferrario and Tami D. Cowden, Las Vegas, for Respondents Bullock Insulation and Insurance Company of the West.

Law Offices of J. Michael Pisias, Jr., and J. Michael Pisias, Jr., and Matthew P. Shelton, San Francisco, CA, for Respondent Insurance Company of the West.

BEFORE THE COURT EN BANC.[1]

OPINION

By the Court, GIBBONS, C.J.:

In the district court, respondent Bullock Insulation, Inc. (Bullock Insulation), filed complaints against appellants Lehrer McGovern Bovis, Inc. (Bovis), and Venetian Casino Resort, LLC (Venetian Resort),[2] for, among other claims, breach of contract and to foreclose on a mechanic's lien. The parties disputed, among other things, whether, by the terms of the subcontract between Bullock Insulation and Bovis, Bovis was required to pay Bullock Insulation to retrofit walls with fire retardant materials. After considering the jury's answers to special interrogatories and its general verdict, the district court entered judgment in favor of Bullock Insulation. The district court later entered an order granting Bullock Insulation's motion for attorney fees and sanctioning Bovis for bad-faith litigation practices. These appeals followed.

In these appeals, we consider the primary issue of whether a new trial is required when the district court creates special interrogatories upon issues of fact and the jury's answers to those interrogatories are inconsistent, *1058 such that an ultimate judgment cannot be entered without contradicting a portion of the answers and the general verdict. While this court has held that parties have a duty to object to inconsistent jury verdicts before the jury is discharged, we conclude that this general rule is not absolute because, under NRCP 49(b), the district court is obligated not to enter a judgment when the answers to interrogatories are inconsistent with each other and one or more answer is also inconsistent with the general verdict. In this case, we conclude that a new trial is warranted regarding the breach of contract claim related to the retrofit issue, even though the parties failed to object to the verdicts as inconsistent prior to discharge of the jury, because the ultimate judgment cannot be reconciled by an interpretation of the special verdicts and the general verdict in their totality. Therefore, because NRCP 49(b) mandates that a judgment shall not be entered when such inconsistencies exist, we conclude that the district court abused its discretion when it entered the inconsistent judgment.

We also consider the enforceability of a mechanic's lien waiver provision entered into before the Legislature amended NRS Chapter 108 to require specific forms for lien waivers and whether a pay-if-paid provision entered into before the Legislature amended NRS Chapter 624 to include provisions for prompt payment is unenforceable as a matter of public policy. Additionally, we consider whether the district court abused its discretion when it sanctioned Bovis for maintaining its defense in bad faith.

We conclude that the district court properly determined that the lien waiver and pay-if-paid provisions were unenforceable based upon Nevada's public policy favoring the statutory right to a mechanic's lien. Additionally, the district court abused its discretion when it sanctioned Bovis for bad-faith litigation practices.

Accordingly, we reverse the judgment on the jury verdict as it concerns the breach of contract claims related to the retrofit issue, based on the inconsistent answers to the special interrogatories, and remand this matter to the district court for further proceedings consistent with this opinion. We affirm the remaining portion of the district court's judgment regarding the lien waiver provision, the pay-if-paid provision, and the principal owed, plus interest. Finally, in light of our decision that a new trial is warranted on the breach of contract claim concerning the retrofit work, we necessarily vacate the portion of the district court's order awarding attorney fees and reverse the portion of its order awarding sanctions.

FACTS AND PROCEDURAL HISTORY

Las Vegas Sands, Inc., the predecessor of Venetian Resort, entered into a Construction Management Agreement (the agreement) with Bovis under which Bovis agreed to manage remaining construction of the Venetian Casino Resort and Hotel (the project). Under the agreement, Bovis was obligated to hire subcontractors and provide the work, labor, services, materials, supplies, and equipment necessary to complete the project.

Bovis later subcontracted with Bullock Insulation for firestopping work on the project. Firestopping involves installing fire retardant material around openings in walls to prevent smoke and fire from spreading between rooms. Under the subcontract, Bullock Insulation was to install "firestop putty pads" around certain of the project's electrical boxes, but the parties dispute whether, by the terms of the subcontract, Bullock Insulation was required to install the putty pads around the electrical boxes in the rooms' separation walls.

The subcontract incorporated the general conditions of the agreement, which contained a lien waiver clause, whereby Bullock Insulation promised "not [to] suffer or permit any lien or other encumbrance to be filed" against the project. The lien waiver clause is located in the agreement after other provisions discussing final payment terms and the conditions precedent for final payment. The lien waiver is not dependent upon Bullock Insulation's receipt of any payment for labor or materials. Also preceding the lien waiver provision of the agreement is a pay-if-paid provision, under which, by way of incorporation into the subcontract, Bullock Insulation's right to payment for its work was contingent upon Venetian Resort's payments to Bovis.

*1059 While the subcontract explicitly required Bullock Insulation "to provide firestop protection of electrical boxes where such boxes are required to have a minimum clear distance in rated walls/partitions," and the original contract documents described the guest room walls as rated, trial testimony nevertheless supported Bullock Insulation's contention that it believed that the walls were not rated. Testimony also revealed that Bovis had instructed Bullock Insulation to insulate according to room mockups, which are constructed rooms that serve as examples for the builders.

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Cite This Page — Counsel Stack

Bluebook (online)
185 P.3d 1055, 2008 WL 2374249, Counsel Stack Legal Research, https://law.counselstack.com/opinion/lehrer-mcgovern-bovis-v-bullock-insulation-nev-2008.