Abuse of Process and Frivolous Lawsuits Part II: NRS 18.010

In the previous post, we discussed the requirements and ineffectiveness of N.R.C.P. 11, which is a rule designed to prevent attorneys and parties to a lawsuit from making improper written representations to the court and from pursuing inappropriate claims or defenses. In a future post, we will be discussing abuse of process as a separate claim.

In this post, part two of a three-part series, we will look at the language and practice surrounding NRS 18.010, which is a statutory fee-shifting provision.

NRS 18.010

As discussed in a prior post, we dissected the rule on attorney’s fees in Nevada, which, in a nutshell, is that each party to a lawsuit pays its own attorney’s fees unless there is some provision in a contract or a statute that allows the recovery of fees by the prevailing party. NRS 18.010 is one such statute.

NRS 18.010 allows two ways (besides having an agreement) for a prevailing party to recover its fees: (1) if the prevailing party has not recovered more than $20,000, and (2) if the opposing party has brought or maintained its claims or defenses “without reasonable ground or to harass the prevailing party.” It is the second prong that is the subject of this post.

In Nevada, we recognize that a party pursuing or defending legal claims will often have to retain an attorney, which often results in expensive justice. However, we consider access to an attorney a fair cost in circumstances where the parties have legitimate disputes and air fairly and honestly using the judicial process to resolve those disputes.

However, when writing this rule, the Nevada legislature recognized that it is unjust for one party to unreasonably increase litigation and therefore make a lawsuit more expensive for another party. To correct this inequity, the legislature wrote the rule giving a court the power to award fees where one party has been using he judicial system illegitimately.

Although this provision as only been in the statute since 1985, the legislature’s instructions to the court for when attorney’s fees should be awarded had already been in the statute for some time:

The court shall liberally construe the provisions of this paragraph in favor of awarding attorney’s fees in all appropriate situations. It is the intent of the Legislature that the court award attorney’s fees pursuant to this paragraph and impose sanctions pursuant to Rule 11 of the Nevada Rules of Civil Procedure in all appropriate situations to punish for and deter frivolous or vexatious claims and defenses because such claims and defenses overburden limited judicial resources, hinder the timely resolution of meritorious claims and increase the costs of engaging in business and providing professional services to the public.

However, like sanctions imposed for violations of Rule 11, fees awarded for claims illegitimately brought or defenses unrighteously claimed are rarely imposed.

Unlike Rule 11, however, there are no procedural irregularities that make NRS 18.010 fees difficult to recover. An attorney can bring a motion for fees and costs at any time, either concurrent with the case-ending motion, afterwards, or even after trial. And since NRS 18.010 is usually brought near or after the end of the case, the court at that point knows full well whether a party has been maintaining legal claims or defenses inappropriately.

The court’s reluctance to award fees in this circumstance are again probably related to a general reluctance by a judge to point the finger at anyone. Courts want to give everyone the benefit of the doubt, even in cases where there is no longer any doubt.

Additionally, even though the legislature made it clear that it wants courts to award fees liberally, the statute is not mandatory. The law does not say that courts must award attorneys fees in circumstances where a party is behaving inappropriately under the rule, but that it may.

Perhaps what courts are not fully aware of—because the court adjudicates disputes rather than representing parties directly—is the frustration and dismay felt by parties who have been legitimately wronged, prove it to the satisfaction of a judge or jury, and are not reimbursed for their efforts at rebutting the false and disingenuous claims of the other party that did nothing but increase litigation costs.

For that reason, instead of counting on courts to award fees, at Parry & Pfau, we utilize fee-recovery methods that do not require a finding of wrongdoing, like statutory offers of judgment (which will be discussed in a future post). We also generally do not waste our time trying to prove the falsity in everything the other party says, recognizing that the court is not interested in verifying the accuracy of every statement, but rather at getting the matter resolved. We have experience to know which issues are worth fighting over, and which ones will only make litigation more expensive.

In the recent past, the attorneys at Parry & Pfau have recovered attorney’s fees in several cases, including custody cases in and out of Nevada, issues involving landlord-tenant law, and general civil litigation matters, including fraud.

 

 

Zachariah B. Parry is an attorney and founding partner at the law firm Parry & Pfau and is an adjunct professor who teaches torts, contracts, and Nevada practice and procedure for UNLV’s paralegal program. He can be reached at 702-912-4451 or zach@p2lawyers.com.