Jv Properties v. Smr7 ( 2014 )

 easements, if any of record on said premises." JV has since defaulted on
the May 10, 2006, promissory note.
SMR7 filed a complaint in district court, and later filed a
motion for partial summary judgment against JV on the issue of JV's
liability. The district court granted partial summary judgment, finding (1)
the offer and acceptance agreement merged with the grant, bargain, and
sale deed, and the deed became the sole memorial of the agreement, and
(2) the grant, bargain, and sale deed, while reserving "rights," did not
expressly restrain the covenant against encumbrances under NRS
111.170(1)(b). The district court later issued a second order granting
summary judgment on the issue of damages based on a formal payoff
demand from the beneficiary of the May 10, 2006, deed of trust. JV now
appeals from both district court orders.
Standard of review
"This court reviews a district court's grant of summary
judgment de novo . . . ." Wood v. Safeway, Inc., 121 Nev. 724, 729, 121
P.3d 1026, 1029 (2005). Summary judgment is appropriate when, after
viewing the evidence and any reasonable inferences drawn from the
evidence in the light most favorable to the nonmoving party, there is no
genuine issue of material fact and the moving party is entitled to
judgment as a matter of law. Id.
This appeal also requires this court to interpret NRS 111.170
as well as the contractual provisions. "Issues involving statutory and
contractual interpretation are legal issues subject to .. . de novo review."
Weddell v. H20, Inc., 128 Nev. „ 271 P.3d 743, 748 (2012). "When
interpreting a statute, this court must give its terms their plain meaning,
considering its provisions as a whole so as to read them in a way that
would not render words or phrases superfluous or make a provision
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nugatory." S. Nev. Homebuilders Ass'n v. Clark Cnty., 121 Nev. 446, 449,
117 P.3d 171, 173 (2005) (internal quotations omitted).
The district court correctly found that the offer and acceptance agreement
merged into the deed.
Traditionally, a contract of sale will merge into the deed once
the deed is executed and delivered. Hanneman v. Downer, 110 Nev. 167,
177, 871 P.2d 279, 285 (1994) (determining that "[t] he terms in the deed
which follows the contract of sale become the sole memorial of the
agreement') (citations omitted). However, the doctrine of merger may not
apply if the parties did not intend for the contract of sale to merge into the
deed. Hanneman, 110 Nev. at 177, 871 P.2d at 285 (concluding that
intention is a "question of fact to be determined by an examination of the
instruments and from the facts and circumstances surrounding their
execution') (citations omitted). The issue here is whether the parties
intended for the offer and acceptance agreement to merge with the deed.
JV argues that the existence of detailed terms and provisions
within its offer and acceptance agreement are evidence that the parties
intended the offer and acceptance agreement to memorialize their deal
and not the deed. Alternatively, JV contends that at a minimum, the
district court granted summary judgment prematurely because intent is a
question of fact. In contrast, SMR7 argues that JV failed to produce
sufficient evidence to warrant application of an exception to the doctrine of
merger or to survive summary judgment.
We agree with SMR7 that after examining the instruments
and surrounding facts, there is no evidence the parties intended for the
offer and acceptance agreement to control over the deed. For instance, the
deed included some but not all of the provisions contained in the offer and
acceptance agreement. This indicates that the parties elected to choose
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which contractual provisions would be included within the deed and which
would not. Further, after reviewing the other evidence presented by JV,
we agree with the district court that no genuine issues of material fact
regarding the doctrine of merger exist.
Therefore, the traditional rule applies, and we affirm the
finding of the district court that the offer and acceptance agreement
merged into the deed upon its execution and delivery.
The district court correctly found that the deed failed to expressly restrain
the covenant against encumbrances.
Unless restrained by the express terms contained in the deed,
all real property conveyed by way of a grant, bargain, and sale deed
includes two statutory covenants: the covenant against prior conveyances,
and the covenant against encumbrances. NRS 111.170(1)(a)-(b). The
issue here is whether the deed's language stating that the conveyance was
subject to tleservations, restrictions, conditions, rights, rights of way and
easements, if any of record" restrained the covenant against
encumbrances.
JV argues that the district court erred when it found that the
concepts of reservations, restrictions, or rights are not interchangeable
with the concept of encumbrances. SMR7 argues that JVs interpretation
confuses the statutory language used in NRS 111.170(1)(a)-the covenant
against prior conveyances-with the statutory language used in NRS
111.170(1)(b)-the covenant against encumbrances. SMR7 notes that NRS
111.170(1)(a) 2 uses the term "right" in describing the covenant against
2 NRS 111.170(1)(a) reads "[t]hat previous to the time of the
execution of the conveyance the grantor has not conveyed the same real
continued on next page. . .
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prior conveyances, while NRS 111.170(1)(b) 3 makes no mention of "right"
in describing the covenant against encumbrances. NRS 111.170(1)(a)-(b).
SMR7 contends that the two terms are not interchangeable, as evidenced
by the Legislature's use of different words in the two subsections of NRS
111.170(1), and that JV's proposed interpretation would render NRS
111.170(1)(b) superfluous.
We agree with SMR7 that the language in the deed fails to
expressly restrain the covenant against encumbrances. NRS 111.170(1)
allows for the covenant against prior conveyances and the covenant
against encumbrances to be restrained "by express terms" NRS
111.170(1). To restrain either of these covenants, the language used in the
deed must comport with NRS 111.170. Under a plain language reading,
the inclusion of the word "rights" within a grant, bargain, and sale deed
disclaimer only restrains the covenant against prior conveyances.
Restraining the covenant against encumbrances requires use of the word
"encumbrance." For instance, if the deed in this case included
encumbrances within its list of items the conveyance was subject to, then
NRS 111.170(1) would have been properly complied with. However, this is
not the case. Thus, we agree with the district court's finding that the deed
did not restrain the covenant against encumbrances.
. continued
property, or any right, title, or interest therein, to any person other than
the grantee." (emphasis added).
3 NRS 111.170(b) reads "rdhat the real property is, at the time of the
execution of the conveyance, free from encumbrances, done, made or
suffered by the grantor, or any person claiming under the grantor."
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Therefore, we affirm the district court's order of partial
summary judgment as to JV's liability.
The district court correctly calculated and awarded damages.
JV does not challenge the accuracy of the amount of the
damages award of $699,815.00.
Rather, JV argues that the damages award itself was
erroneous because the parties expressly agreed pursuant to the offer and
acceptance agreement that SMR7 would obtain title insurance and that
the title company would be liable for any alleged loss associated with the
transaction in question. JV contends that to allow SMR7 to recover from
JV is tantamount to re-writing the parties' agreement, which is not
permitted. SMR7 argues that JV's reliance on the terms of the offer and
acceptance agreement is irrelevant because it merged with the deed.
Alternatively, SMR7 asserts that even if this court looks to the language of
the agreement, there is no language that limits damages against JV.
Further, SMR7 contends that the mere fact that title insurance was
obtained has no effect on whether JV is liable for damages.
We agree with SMR7 that JV's argument lacks merit because,
as discussed above, the offer and acceptance agreement merged with the
deed, and thus its terms do not control. However, even if the terms of the
agreement are considered, the damages award against JV is still proper.
The fact that the parties agreement provided for title insurance does not
prevent SMR7 from recovering damages for the breach of the deed. See
Lagrange Const., Inc. u. Kent Corp., 88 Nev. 271, 275, 496 P.2d 766, 768
(1972) (stating that damages must place the non-breaching party in as
good a position as it would have been had there been no breach).
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Therefore, we affirm the summary judgment order of the district court as
to damages. Accordingly we 4
ORDER the judgment of the district court AFFIRMED.
, J.
Hardesty
I , J.
J.
cc: Hon. Joanna Kishner, District Judge
Paul H. Schofield, Settlement Judge
Bogatz Law Group
Kolesar & Leatham, Chtd.
Eighth District Court Clerk
4 We have considered the parties' remaining arguments and conclude
that they are without merit.
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