Dombroski v. Nv Energy, Inc. ( 2016 )

IN THE SUPREME COURT OF THE STATE OF NEVADA
RICHARD DOMBROSKI, AN No. 67405
INDIVIDUAL,
Appellant,
VS.
FILED
NV ENERGY, INC., A NEVADA MAR 1 8 2016
CORPORATION, TRACE K. LUDEMAN
Respondent. CLERK OF SUPREME COURT
BY
DEPUTY CLERK a.
ORDER OF AFFIRMANCE
This is an appeal from a district court order dismissing a
declaratory relief action for failure to state a claim. Eighth Judicial
District Court, Clark County; Jerry A. Wiese, Judge.
Appellant Richard Dombroski sued his former employer,
respondent NV Energy, Inc., claiming that the severance agreement he
signed was unconscionable. Appellant's amended complaint primarily
alleged that the agreement unfairly deprived him of rights under various
anti-discrimination laws, and he sought damages and rescission through
claims for declaratory relief, rescission, and breach of the covenant of good
faith and fair dealing. Respondent filed a motion to dismiss under NRCP
12(b)(5), which the district court granted, and appellant appealed. Having
reviewed the parties' briefs and the appendix, we conclude that the district
court did not err in deciding that appellant failed to state a claim for relief
and dismissing the action. Buzz Stew, LLC v. City of N. Las Vegas, 124
Nev. 224, 227-28, 181 P.3d 670, 672 (2008) (explaining that this court
reviews de novo an order dismissing an action under NRCP 12(b)(5),
looking at the complaint to determine whether the plaintiff has alleged
facts that, if true, would entitle him to relief).
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With• respect to his first cause of action, appellant lacks
standing to pursue declaratory relief, as he has not alleged a live
controversy in which he claims a valid legal interest. See Knittle v.
Progressive Gas. Ins. Co., 112 Nev. 8, 10, 908 P.2d 724, 725 (1996) (noting
that declaratory relief is available only when, among other things, there
exists a justiciable controversy and the party seeking relief has a legally
protectable interest in that controversy); Jones v. Sears Roebuck & Co.,
301 Fed. App'x 276, 282 (4th Cir. 2008) (recognizing that no controversy
exists in which to declare a contract provision unconscionable when the
other party to the contract has not taken any legal action or threatened
any future action against the plaintiff that would implicate the provision,
and the plaintiff has not alleged an underlying dispute that could progress
to that point). Neither appellant's complaint nor his appellate briefs
indicate that he sought to assert discrimination claims against respondent
and was prevented from doing so, or that he intends to assert such claims
and will be prevented from doing so, by the allegedly unconscionable
provisions. And as the district court pointed out, citing 42 U.S.C. § 2000e-
5(e)(1) and NRS 233.160(1)(b), it appears that any such claims expired
long ago, which appellant does not dispute. Therefore, appellant failed to
state a valid claim for declaratory relief.
For similar reasons, the district court properly dismissed
appellant's second cause of action, for rescission based on
unconscionability. Appellant has not alleged that respondent has sought
to enforce the severance agreement against his interests, and
"Thhiconscionability' is generally a defense to the enforcement of a
contract, and is not a proper claim for affirmative relief." Ramos v. Chase
Home Fin., 810 F. Supp. 2d 1125, 1141 (D. Haw. 2011) (citing Gaitan v.
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Mortg. Elec. Registration Sys., No. EDCV 09-1009 YAP (MANx), 2009 WL
3244729, at *13 (C.D. Cal., Oct. 5, 2009) ("Unconscionability may be raised
as a defense in a contract claim, or as a legal argument in support of some
other claim, but it does not constitute a claim on its own.") and Carey v.
Lincoln Loan Co., 125 P.3d 814, 829 (Or. Ct. App. 2005)
("[U]nconscionability is not a basis for a separate claim for relief.")).
Likewise, rescission is a remedy in contract, not a cause of action. Phillips
v. Bank of Am., No. CIV. 10-00551, 2011 WL 240813, at *9 (D. Haw., Jan.
21, 2011) (citing Bischoff v. Cook, 185 P.3d 902, 911 (Haw. Ct. App. 2008));
see Bergstrom v. Estate of DeVoe, 109 Nev. 575, 577, 854 P.2d 860, 861
(1993) ("Rescission is an equitable remedy which totally abrogates a
contract and which seeks to place the parties in the position they occupied
prior to executing the contract.") Accordingly, appellant failed to state a
claim for rescission based on unconscionability.
Finally, appellant's third claim asserts that the severance
agreement contains unconscionable and/or illegal terms and, thus,
defendant breached the implied covenant of good faith and fair dealing.
While unclear whether appellant is asserting this claim in contract or in
tort, he fails to explain how respondent performed in a manner unfaithful
to the contract's purpose such that the implied covenant was breached.
See Perry v. Jordan, 111 Nev. 943, 948, 900 P.2d 335, 338 (1995) (noting
that a claim for breach of the implied covenant of good faith and fair
dealing exists when the defendant breached his contractual duty by
performing in a manner unfaithful to the purpose of the contract, thereby
denying the plaintiffs justified expectations); see also Contreras v. Master
Fin., Inc., No. 3:10-CV-0477-LRH-VPC, 2011 WL 32513, at *3 (D. Nev.,
Jan. 4, 2011) (citing Indep. Order of Foresters v. Donald, Lufkin &
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Jenrette, Inc., 157 F.3d 933, 941 (2d Cir. 1998) ("[A]n implied covenant
relates only to the performance under an extant contract, and not to any
pre-contract conduct.")). As a result, appellant failed to state a claim for
breach of the implied covenant of good faith and fair dealing.
Because the district court properly dismissed appellant's
action for failure to state a viable claim, we
ORDER the judgment of the district court AFFIRMED.
LIA-A. ALA.; ,J.
Hardesty
aitta
cc: Hon. Jerry A. Wiese, District Judge
Lansford W. Levitt, Settlement Judge
Kirk T. Kennedy
Littler Mendelson/Las Vegas
Karyn M. Taylor
Eighth District Court Clerk
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