Job's Peak Ranch v. Douglas Co. ( 2015 )

 expansion or upgrade of the system, but shall be
liable for all regular fees for service such as the
annual "standby fee" and the meter set fees with
each building permit.
Five Creek also filed a Declaration of Covenants, Conditions &
Restrictions (CC & Rs) for the Job's Peak Ranch Community Association
(the Association). The CC & Rs permitted Five Creek to appoint and
remove members of the homeowners' association board at its discretion
until one of the following occurred: (1) 60 days after Five Creek had
conveyed 75 percent of the units, (2) 5 years after Five Creek stopped
selling units, (3) 5 years after Five Creek last subjected new property to
the CC & Rs, or (4) 10 years after the CC & Rs were recorded. Five Creek
controlled the homeowners' association during most of the Job's Peak
development.
Despite numerous problems with the water quality, the
County, through the BOC, approved an Agreement for Water System
Dedication (the Dedication Agreement), which transferred control and
operation of the Job's Peak Ranch water system from Five Creek to the
County in December 2005. The County acknowledged that it "had a
chance to inspect, test and evaluate the system over the past 24 months,
and ... accept[ed] the [water] system as-is" with certain delineated
exceptions.
Then, in February 2006, the County approved the Fourth
Amendment to the Development Agreement and adopted the amendment
by Ordinance 2006-1162. The Fourth Amendment to the Development
Agreement removed the language entitling the homeowners to access the
water system without hook-up, expansion, or upgrade costs. The Fourth
Amendment also added a section permitting the "prospective collection of
connection fees" for future homeowners.
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Pursuant to the CC & Rs adopted by Five Creek, Five Creek's
control period of the homeowners' association ended in May or June 2006,
and the Job's Peak residents gained control of the homeowners' association
in July 2006. In September 2009, the County adopted Resolution 2009R-
063 to alter the water rates and institute connection fees for Job's Peak
homeowners. Resolution 2009R-063 raised water rates for all homeowners
in Job's Peak and added connection fees for properties whose interests had
not vested. The Association responded by filing an Application for Writs of
Mandamus and Prohibition or, in the Alternative, Complaint for
Declaratory Relief, Injunction, Damages, and Indemnity against Five
Creek and the County in October 2009. 1 The Association challenged the
adoption of the Fourth Amendment, the Dedication Agreement, and
Resolution 2009R-063 through its contract and declaratory relief claims.
Alternatively, if those challenges were unsuccessful, it also sought to
enforce the Fourth Amendment against the County. The Association also
raised claims for negligence, breach of fiduciary duty, accounting,
intentional and negligent misrepresentation, and indemnity.
The County and Five Creek both filed motions to dismiss the
Association's complaint. In February 2010, the district court entered an
order remanding Resolution 2009R-063 back to the County because notice
of the resolution was insufficient, and dismissed all of the Association's
other claims because they were time barred or because the Association
1 Thiscourt previously denied a writ petition filed by the Association
approximately 20 days after filing this appeal and which raised virtually
the same issues. See Job's Peak Ranch Cmty. Ass'n, Inc. v. Douglas Cnty.,
Docket No. 55694 (Order Denying Petition for Writ of Mandamus or
Prohibition, April 9, 2010).
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lacked standing. This appeal followed. For the reasons set forth below,
we affirm in part and reverse in the part the district court's order. 2
Standard of review
Initially, we note that the district analyzed the County's and
Five Creek's motions to dismiss under the incorrect standard of review,
articulating the standard for a petition for judicial review rather than a
motion to dismiss pursuant to NRCP 12(b)(5). Nevertheless, we have
consistently held that
[i]n considering an appeal from an order granting
a motion to dismiss for failure to state a claim,
this court applies a rigorous, de novo standard of
review. In our review, we accept the plaintiffns
factual allegations as true and then determine
whether these allegations are legally sufficient to
satisfy the elements of the claim asserted.
Pack v. LaTourette, 128 Nev., Adv, Op. 25, 277 P.3d 1246, 1248 (2012)
(internal citation omitted).
20n appeal, neither the County nor Five Creek challenge the district
court's order setting aside Resolution 2009R-063 and remanding it back to
the County for insufficient notice. To be sure, Five Creek's answering
brief merely joins in the County's answering brief; any reference to the
County's arguments encompasses those presumably being made by Five
Creek as well.
In addition, the parties do not challenge the district court's ruling on
the Association's second claim for relief: a writ of mandamus prohibiting
the County from enforcing the water rates. The parties also do not
challenge the district court's order finding that the Association has
representational standing for its units' owners under NRS 116.3102(1)(d).
Therefore, we do not discuss these issues further in this order. Las Vegas
Metro. Police Dep't v. Coregis Ins. Co., 127 Nev., Adv. Op. 47, 256 P.3d 958,
961 n.2 (2011) ("Because [the appellant] failed to provide any argument or
citation to authority on the issues. . . , we will not address these issues.").
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The district court correctly analyzed whether the Association timely filed to
set aside Resolution 2009R-063
The district court analyzed several statutes in determining
whether the Association had timely challenged Resolution 2009R-063,
including portions of NRS Chapters 244, 271, 278, and 318. After
conducting its analysis, the district court correctly concluded that the
more specific statute controls and applied NRS Chapter 318, which
pertains to rate schedules for services provided by a county-operated
water system. Under NRS 318.199(6), a party wishing to challenge a
resolution adopted by a county board has 30 days from the resolution's
effective date to commence an action to set aside the resolution. And in
this instance, the County adopted Resolution 2009R-063 on September 3,
2009, to alter the water rates and institute connection fees for Job's Peak
homeowners, and the resolution became effective on October 1, 2009. The
Association filed its complaint on October 5, 2009, well within the 30-day
period to challenge a change in water rates. See NRS 318.199(6).
Accordingly, we agree with the district court that the Association's
challenge to the resolution establishing the new water rates was timely.
The district court incorrectly dismissed the Association's remaining claims
as untimely under NRS 278.0235 and NRS 11.190
NRS 278.0235
The district court broadly concluded that the Association's
challenges to the County's adoptions of the Development Agreement, its
amendments, and the Dedication Agreement were untimely under NRS
278.0235, without considering the impact of NRS 278.0205(1). 3 Under
3 The
Legislature amended certain subsections in NRS 278.0205 and
278.0235 during the 2015 legislative session. S.B. 66, 78th Leg. (Nev.
continued on next page...
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NRS 278.0205(1), "[t]he agreement for development of land may be
amended or cancelled, in whole or in part, by mutual consent of the parties
to the agreement or their successors in interest . ." (Emphasis added.)
The term successor in interest is not defined in the statute or in the
Development Agreement. We have previously held that a successor in
interest is "one who has acquired legal title by deed from a vendor." Title
Ins. & Trust Co. v. Chicago Title Ins. Co., 97 Nev. 523, 526, 634 P.2d 1216,
1218 (1981); see also Black's Law Dictionary 1431 (6th ed. 1990) (defining
"[s]uccessor in interest" as "[o]ne who follows another in ownership or
control of property").
According to the terms of the Development Agreement, the
"agreement may be amended by the parties by an agreement in writing
executed by OWNER and adopted by the COUNTY as an ordinance in
compliance with Nevada Revised Statutes." The Development Agreement
defines "OWNER" as Five Creek and "all its officers and agents and other
persons or entities or association [including successors in interest] which
hold any legal or equitable interest in the real property."
Under the Development Agreement, Job's Peak Ranch
homeowners who purchased property from Five Creek are successors in
interest. NRS 278.0205(1) expressly requires the consent of Five Creek's
successors in interest for any amendments to land development
agreements. It is unclear from the record whether the homeowners
purchased lots from Five Creek prior to the adoption of the Dedication
...continued
2015). Any discussion in this order related to these statutes refers to the
statutes in effect at the time of the cause of action.
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Agreement and/or the Fourth Amendment. 4 And nothing in the record
demonstrates that the County provided any evidence that it obtained the
consent of any homeowners who had purchased property and had vested
rights, but had not given consent, prior to amending the Development
Agreement, thus, violating NRS 278.0205(1). Without consent, the
Dedication Agreement and the Fourth Amendment would be invalid as to
those homeowners. Because a material issue of fact remains
undetermined, we remand this matter to the district court for further
exploration of this issue.
Moreover, pursuant to NRS 278.0235, any action seeking
judicial review of a governing body's decision regarding a land
development issue "authorized by NRS 278.010 to 278.630, inclusive,"
must be brought within 25 days after notice of the final decision has been
filed with the clerk of the governing body. Accordingly, without the
"mutual consent" required by NRS 278.0205(1), NRS 278.0235's 25-day
limitations period for judicial review would not apply because any
governmental action on the Dedication Agreement and the Fourth
Amendment would be invalid and not "authorized by NRS 278.010 to NRS
278.630," as it relates to those non-consenting homeowners with vested
rights in the Development Agreement.
NRS 11.190
The district court also dismissed the Association's negligence,
misrepresentation, fraud, breach of fiduciary duty, accounting, and
indemnity claims, stating that they were barred by NRS 11.190's statutes
4 The Association purports to represent approximately 55 Job's Peak
Ranch lot owners; however, it fails to clarify when each of those
individuals became lot owners.
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of limitations. While we agree with the district court's dismissal of the
Association's claims for breach of fiduciary duty and misrepresentation,
we disagree that the Association's remaining claims were statutorily
barred.
"In determining whether a statute of limitations has run
against an action, the time must be computed from the day the cause of
action accrued. A cause of action 'accrues' when a suit may be maintained
thereon." Clark v. Robison, 113 Nev. 949, 951, 944 P.2d 788, 789 (1997)
(internal citation omitted). If the facts giving rise to the cause of action
are matters of public record then "Nile public record gave notice sufficient
to start the statute of limitations running." Cumming v. San Bernardino
Redev. Agency, 125 Cal. Rptr. 2d 42, 46 (Ct. App. 2002); see also Allen v.
Webb, 87 Nev. 261, 272, 485 P.2d 677, 684 (1971) (Gunderson, J.,
concurring) (concluding that, where a written document regarding real
property was not properly recorded, there was not proper notice of the
conveyance of that property so as to trigger the statute of limitations
period on a quiet title action).
The following dates are pertinent to this discussion: the
Dedication Agreement was recorded on December 20, 2005; the County
published notice of its intentions regarding the Fourth Amendment on
January 11, 2006, and recorded the amendment on March 3, 2006; and
Five Creek's control of the Association ended on July 22, 2006, when the
homeowners elected a new board for the Association. The Association filed
its claims on October 5, 2009. Based on these dates, we determine that
the Association's causes of action accrued on the following dates: (1) the
claims against the County and Five Creek for declaratory relief and
specific performance accrued on December 20, 2005, when the County
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accepted the water system under the Dedication Agreement; (2) the claim
against the County for breach of contract accrued on March 3, 2006, when
the County recorded the Fourth Amendment; (3) the claims against the
County for negligence in accepting the Dedication Agreement accrued on
December 20, 2005, when the agreement was recorded; (4) the claim
against Five Creek for breach of fiduciary duty while in control of the
Association accrued at the latest on July 22, 2006; (5) the claim against
Five Creek and the County for accounting while Five Creek was in control
of the Association accrued upon adoption of Resolution No. 2009R-063 in
September 2009, when the Association would become aware that possibly
not all funds "were expended for the benefit" of the water system; (6) the
claims against the County and Five Creek for intentional and negligent
misrepresentation accrued on March 3, 2006, when the Fourth
Amendment was recorded and dispelled any reasonable belief that the
homeowners' water rates would not be increased; and (7) the claim against
the County and Five Creek for either "express or implied duty to
indemnify" homeowners would accrue when the Fourth Amendment was
recorded on March 3, 2006.
Pursuant to NRS 11.190, the Association's claims have the
following periods of limitation: (1) claims for declaratory relief and specific
performance based on breach of a written contract expire after six years,
NRS 11.190(1)(b); (2) similarly, claims for breach of contract expire after
six years, NRS 11.190(1)(b); (3) claims for negligence based on breach of a
written contract expire after six years, NRS 11.190(1)(b); (4) claims for
breach of fiduciary duty expire after three years, NRS 11.190(3)(d); (5)
claims for accounting based on an underlying breach of contract claim
expire after six years, NRS 11.190(1)(b); (6) claims for misrepresentation
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or fraud expire after three years, NRS 11.190(3)(d); and (7) equitable
claims for express indemnity expire after six years, NRS 11.190(1)(b), and
claims for implied indemnity expire after four years, NRS 11.190(2)(c).
Thus, we conclude that the district court correctly concluded that the
Association's claims for breach of fiduciary duty and misrepresentation,
filed on October 5, 2009, were barred by the three-year statute of
limitations for those causes of action, which expired on July 22, 2009, and
March 3, 2009, respectively. The district court erroneously concluded,
however, that the Association's remaining claims were statutorily barred,
as they were subject to four and six year limitations periods that had not
yet expired at the time the Association filed its claims. 5
For the reasons set forth above, we ORDER the judgment of
the district court AFFIRMED IN PART AND REVERSED IN PART AND
REMANDED to the district court for further proceedings consistent with
this order.
4
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cc: Ninth Judicial District Court, Department 2
5 The Association also argues that the district court erred in
dismissing its claims to enforce the Development Agreement and its
amendments because it was a third-party beneficiary to the agreements.
Because we agree with the district court's finding that the Association has
representational standing under then-existing NRS 116.3102(1)(d), we
determine that this argument is moot.
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James Georgeson, Settlement Judge
Kelly R. Chase
Thorndal Armstrong Delk Balkenbush & Eisinger/Reno
Douglas County District Attorney/Minden
Minden Lawyers, LLC
Douglas County Clerk
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