PUB. EMPLOYEES' RETIREMENT SYS. OF NEVADA VS. GITTER C/W 69208/69961

2017 NV 18
Nevada Supreme Court·Decided April 27, 2017·No. 69208·Published

Opinion

133 Nev., Advance Opinion IS IN THE SUPREME COURT OF THE STATE OF NEVADA

PUBLIC EMPLOYEES' RETIREMENT No. 69208 SYSTEM OF NEVADA, A PUBLIC AGENCY, A PUBLIC ENTITY AND COMPONENT OF THE STATE OF NEVADA, FILED Appellant, vs. APR 2 7 2017 SHAE E. GITTER, AN INDIVIDUAL; AND JARED SHAFER, AS SPECIAL ADMINISTRATOR OF THE ESTATE OF KRISTINE JO FRESHMAN, Respondents. PUBLIC EMPLOYEES' RETIREMENT No. 69939 SYSTEM OF NEVADA, A PUBLIC ENTITY AND COMPONENT UNIT OF THE STATE OF NEVADA, Appellant, vs. SHAE E. GITTER, AN INDIVIDUAL; AND JARED SHAFER, AS SPECIAL ADMINISTRATOR OF THE ESTATE OF KRISTINE JO FRESHMAN, Respondents. W. CHRIS WICKER; AND WOODBURN No. 69961 AND WEDGE, Petitioners, vs. THE EIGHTH JUDICIAL DISTRICT COURT OF THE STATE OF NEVADA, IN AND FOR THE COUNTY OF CLARK; AND THE HONORABLE JAMES CROCKETT, DISTRICT JUDGE, Respondents, and SHAE E. GITTER; AND JARED SHAFER, Real Parties in Interest.

SUPREME COURT OF NEVADA

10) 1947A cto, n Mer:1 77121

Consolidated appeals from a district court judgment and post-

judgment awards of interest, fees, and costs, and an original petition for a writ of mandamus challenging an award of attorney fees. Eighth Judicial District Court, Clark County; James Crockett, Judge.

Affirmed in part, vacated in part, reversed in part; petition granted; and remanded with instructions.

Woodburn & Wedge and W. Chris Wicker and Joshua M. Woodbury, Reno, for Public Employees' Retirement System of Nevada, W. Chris Wicker, and Woodburn and Wedge.

Christopher G. Nielsen, Carson City, for Public Employees' Retirement System of Nevada.

Bailey Kennedy and Dennis L. Kennedy, Kelly B. Stout, and Amanda L. Stevens, Las Vegas, for Shae E. Gitter and Jared Shafer, as Special Administrator of the Estate of Kristine Jo Freshman.

BEFORE THE COURT EN BANC.

OPINION By the Court, GIBBONS, J.:

In this consolidated matter, we are asked to determine whether (1) Nevada's general slayer statutes apply to the Public Employees' Retirement Act (PERS Act) for the purposes of determining payment of survivor benefits, (2) the Public Employees' Retirement System of Nevada (PERS) is exempted from paying prejudgment or post- judgment interest out of the PERS trust fund, (3) an expert consultant must testify to recover $1,500 or less in costs for that expert under NRS 18,005(5), and (4) attorney fees were appropriate under NRS 7.085 and SUPREME COURT OF NEVADA

9)) 1947A 18.010. We hold that Nevada's general slayer statutes are applicable to the FEES Act so that any person who kills their PERS-member spouse must be treated as if they predeceased the PERS-member spouse for the purposes of determining payment of survivor benefits. In such a case, the FEES member shall be treated as unmarried at the time of his or her death so that benefits may be paid to a survivor beneficiary. We also hold that PERS is not exempt from paying prejudgment or post-judgment interest, though interest should have been awarded in this case under NRS 17.130. We further hold it is within the district court's discretion to award up to $1,500 in reasonable costs for a nontestifying expert consultant under NRS 18.005(5). Finally, we reverse the award of attorney fees, which we conclude should not have been awarded under NRS 7.085 and 18.010.

FACTS AND PROCEDURAL HISTORY Kristine Jo Freshman was employed by the Clark County School District and a member of FEES for 24 years In 2009, Kristine was killed by her husband, Walter Freshman. Walter pleaded guilty to seconddegree murder and was adjudicated a killer as defined by NRS 41B.130 the following year. Before her death, Kristine designated her daughter, Shae E. Gitter, as her survivor beneficiary. PERS survivor benefits In 2011, Gitter applied to FEES for survivor benefits. PERS denied Gitter's request, indicating the following in its denial letter:

NRS 286.671 [et seq.] governs [PERS]

regarding benefits for survivors. In the case of a member who was married at the time of death, the member's spouse and minor children are the persons eligible to receive benefits.

NRS 286.669 provides that if the spouse is convicted of the murder or voluntary SUPREME COURT OF NEVADA

(0) 1947A e. 3

manslaughter of a member of [FEES], the spouse is ineligible to receive any benefit conferred by any provision of the [PERS Act] by reason of death of that member. Neither this provision, nor any other provision in the [PERS Act], makes any other person eligible to receive such benefit. Based upon the previously mentioned statutes, [PERS] is unable to pay benefits pursuant to your application.

After retaining legal representation, Gitter and respondent Jared Shafer, as special administrator of the Estate of Kristine Jo Freshman (Kristine's Estate or, collectively, Gitter), requested copies of Kristine's PERS records. PERS indicated it was unable to release records to Gitter or Kristine's Estate because neither was entitled to survivor benefits. Ultimately, Gitter petitioned the probate court and obtained a court order instructing PERS to provide copies of Kristine's records.

After PERS produced Kristine's records, Gitter and Kristine's Estate filed suit seeking to collect Gitter's survivor benefits. On Gitter's motion for partial summary judgment, the district court granted Gitter's claim for declaratory relief establishing that NRS Chapter 41B (Nevada's slayer statutes) is applicable to NRS Chapter 286 (the PERS Act) Specifically, the district court found as follows:

NRS Chapter 41B applies to PERS benefits for survivors of a deceased PERS member, including, but not limited to Spousal Benefits and benefits for a survivor beneficiary pursuant to NRS 286.6767.

. . . Pursuant to NRS 41B.310(3), [Walter] is deemed to have predeceased [Kristine] for the purposes of determining entitlement to PERS benefits for survivors as set forth in NRS 286.671- 286. 679, inclusive.

. . . Pursuant to NRS 4111310(3), PERS shall treat [Kristine] as being unmarried at the time of SUPREME COURT OF NEVADA

4

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her death for the purpose of determining entitlement to PERS benefits for survivors.

. . . Gitter is entitled to survivor benefits as set forth in NRS 286.6767-286.6769, inclusive. In light of the district court's summary judgment order, the parties stipulated to the amount of back payments that PERS owed to Gitter: $203,231.76. However, Gitter filed a motion seeking prejudgment and post-judgment interest after PERS asserted it was not permitted to pay interest under the PERS Act. Gitter argued PERS owed prejudgment and post-judgment interest under NRS 99.040(1)(a), NRS 99.040(1)(c), or NRS 17.130. PERS argued it was not obligated to pay interest because interest is not identified as an expense that may be paid from the PERS trust fund pursuant to NRS 286.220(4).

The district court granted Gitter's motion and, in its judgment on the amounts due, ordered FEES to pay interest under NRS 99.040(1)(a). The district court found that in 1986, Kristine and her qualified employer entered into a contract, which "includes eligibility for PERS benefits (including survivor benefits) as part of its compensation package" and "does not fix a rate of interest for any portion of the compensation due thereunder." Expert witness fees Gitter later filed a memorandum of costs and disbursements, which included $5,000 in expert witness fees as costs for a financial consultant. Gitter provided the district court with the financial consultant's invoice and curriculum vitae. FEES moved to retax costs, challenging the $5,000 in fees paid to a nontestifying expert. The district court found "[lit was reasonable for Gitter to retain a financial consultant to review amounts calculated by PERS and calculate interest amounts,"

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