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More than $750k awarded to Swan Lake flood plaintiffs, Reno city attorney fined for refusing to "admit the truth"

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SECOND JUDICIAL DISTRICT COURT OF THE STATE O...
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(2) GRANTS the City of Reno’s Motion Re: Date...
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January 1, 2017, and May 31, 2017, resulting ...
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More than $750k awarded to Swan Lake flood plaintiffs, Reno city attorney fined for refusing to "admit the truth"

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Washoe County District Court Judge Barry Breslow last week sanctioned the City of Reno by fining city attorneys $1,500 for failing to admit to facts in the Swan Lake flood case filed by Lemmon Valley residents.

The sanction is on top of awarding more than $750,000 in damages to plaintiffs in the case. The award does not include attorney fees, which could double the amount owed to plaintiffs and attorneys. That's on top of, likely, hundreds of thousands of dollars incurred by the city fighting the case.

A jury in 2019 found the city negligent and responsible for allowing development in a flood plain that ultimately damaged homes, rendering them unlivable, during the 2017 flooding of Swan Lake.

Washoe County District Court Judge Barry Breslow last week sanctioned the City of Reno by fining city attorneys $1,500 for failing to admit to facts in the Swan Lake flood case filed by Lemmon Valley residents.

The sanction is on top of awarding more than $750,000 in damages to plaintiffs in the case. The award does not include attorney fees, which could double the amount owed to plaintiffs and attorneys. That's on top of, likely, hundreds of thousands of dollars incurred by the city fighting the case.

A jury in 2019 found the city negligent and responsible for allowing development in a flood plain that ultimately damaged homes, rendering them unlivable, during the 2017 flooding of Swan Lake.

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More than $750k awarded to Swan Lake flood plaintiffs, Reno city attorney fined for refusing to "admit the truth"

  1. 1. 1 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 SECOND JUDICIAL DISTRICT COURT OF THE STATE OF NEVADA IN AND FOR THE COUNTY OF WASHOE * * * JEFFREY ALAN JOHNSON; JEFFREY ALAN JOHNSON, JR; DONNA ROBINSON; DAVID “MIKE” and LINDA WALLS, individually and on behalf of all persons similarly situated; Plaintiffs, vs. THE CITY OF RENO, a political subdivision of the State of Nevada, and DOES individuals 1-10, and ROE corporations 1-10, inclusive; Defendants. _____________________________________/ Case No.: CV17-01041 Dept. 8 ORDER ON PENDING MOTIONS AND GRANTING SUMMARY JUDGMENT TO PLAINTIFFS This action was commenced in May 2017 when a complaint was filed for: (1) inverse condemnation, (2) trespass, (3) nuisance, and (4) conversion. A jury trial was held in June 2019 in the liability phase of this case; the jury and this Court found the City liable for inverse condemnation. This Order resolves all pending motions and enters summary judgment in favor of the Plaintiffs. Specifically, the Court: (1) GRANTS Plaintiffs’ Motion to Strike City’s Rebuttal Expert Raymond Pezonella filed October 13, 2020; and Plaintiffs’ Motion to Strike City’s Rebuttal Expert Anthony Wren filed October 14, 2020, which the City opposed and on which the Court heard oral argument on December 14, 2020; F I L E D Electronically CV17-01041 2021-02-11 04:54:45 PM Jacqueline Bryant Clerk of the Court Transaction # 8292647
  2. 2. 2 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 (2) GRANTS the City of Reno’s Motion Re: Date of Taking filed October 17, 2019, to which the Plaintiffs responded and on which the Court heard argument on December 14 and 22, 2020; (3) RULES ON Plaintiffs’ Motion to Set Date of Valuation filed August 1, 2019, which the City opposed and on which the Court heard argument on August 21, 2019; (4) DENIES Plaintiffs’ Motion to Disqualify William McKean as Trial Counsel filed on October 16, 2020, which the City opposed and on which the Court heard argument on December 14 and 22, 2020; (5) GRANTS Plaintiffs’ Motions for Summary Judgment (three separate motions, all filed on October 26, 2020, one each on behalf of: (1) the Johnsons; (2) Donna Robinson; and (3) the Walls), which the City opposed and on which the Court heard argument on December 14 and 22, 2020; (6) GRANTS Plaintiffs’ Motion in Limine No. 1 Re: Donan Report, filed November 13, 2020, which the City opposed and on which the Court did not hear argument; (7) GRANTS Plaintiffs’ Motion in Limine No. 2 Re: Schenk Report, filed November 13, 2020, which the City opposed and on which the Court did not hear argument; and (8) GRANTS Plaintiffs’ Motion for Determination of Sufficiency of the Admissions, filed October 15, 2020, which the City opposed and on which the Court heard argument on December 22, 2020. The Court’s reasoning for those orders is set forth in detail below. Without additional analysis, the Court also denies as moot those other pending motions listed in the Court’s December 31, 2020, Summary Decision on Pending and Argued Motions. PROCEDURAL HISTORY A complaint for inverse condemnation and other torts claims was filed in May 2017 on behalf of individual property owners whose properties had been physically invaded by water from Swan Lake during 2017. After defeating the City’s motion to dismiss the action, in October 2017, the Plaintiffs moved to certify the class consisting of all individual property owners whose properties had been physically invaded by water from Swan Lake at any time between
  3. 3. 3 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 January 1, 2017, and May 31, 2017, resulting in identifiable damages from a taking, nuisance and/or trespass to real property, or conversion of personal property caused by the city’s actions. Concluding that the requirements of Nevada Rule of Civil Procedure (“NRCP”) 23(a) and (b) were met, the Court certified the class based upon the finding that the number of potential claimants rendered joinder impracticable, the common question of whether the City proximately caused the physical intrusion of waters onto the class members’ properties predominated over other issues, the proposed class representatives would fairly and adequately protect the class’s interests, and the class representatives’ claims were typical of the class. (Order Certifying Feb. 12, 2018 at 2-4). Plaintiffs herein were the approved Class Representatives found to have claims typical of the remaining class members. At the same time, the Court bifurcated the action, determining that judicial economy would be best served by litigating liability before conducting discovery and trial on the amount of damages to be awarded, if liability was established. (Id. at 4). Discovery proceeded on liability issues. Due to the complexity of the issues in this case, the Court directed the parties to hold regular case management conferences with the Second Judicial District Court’s Discovery Commissioner. Discovery frequently became contentious, with the Plaintiffs raising issues regarding the City’s failure to respond to discovery requests, which ultimately lead the Plaintiffs to request a continuance of the originally set trial date. (Rep. and Rec. Sept. 27, 2018). Discovery disputes led to the recommendation by the Discovery Commissioner for sanctions against the City. Although the Court adopted the material portions of the Recommendation for Order, it declined to affirm the sanction recommended by the Discovery Commissioner (Rep. and Rec. Dec. 4, 2018; Order Dec. 14, 2018). The City would later argue it was deprived of an opportunity to conduct discovery on substantial injury during the liability phase; the Court rejected that argument because at the time of the liability trial, both parties had sufficient information regarding the substantial injury to the Class Representatives’ properties. (Order Deny. Cont. June 13, 2019). On June 10, 2019, a jury trial regarding liability for the claims commenced. However, a mere weeks before trial began, the Court was reminded that the “taking” element of the inverse
  4. 4. 4 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 condemnation claim is a question of law.1 Thus, the Court determined the “taking” element would be presented to the jury for decision only in an advisory capacity pursuant to NRCP 39(c)(1). The jury had complete fact-finding authority over the question of causation of the flooding and the tort claims. After over two weeks of trial, the jury returned a verdict that the City had condemned the property of each of the representative Plaintiffs. A special verdict was rendered in which the jury found: (1) that the City had taken the representative plaintiffs’ private properties; (2) that the taking was for public use; and (3) that the City’s activities were a proximate cause of the taking.2 After receiving the advisory verdict that a taking occurred—and concurring—the Court entered findings of fact and conclusions of law holding that the Plaintiffs established the taking element of their inverse condemnation claim against the City by a preponderance of the evidence adduced at trial. (FFCL July 30, 2019). Once liability was established, the action proceeded to the second phase—the extent of damages. Before the amount of damages could be determined, a date of valuation needed to be set. The Plaintiffs sought a determination that the date of valuation was the date of the liability trial, arguing that the City’s discovery abuses had caused significant delay. The Court determined that the delay could not be solely blamed on the City3 and ordered that the date of service of the complaint be used to value the taken property: June 5, 2017. 1 Fritz v. Washoe Cty., No. 75693 at 4 n.2 (Nev. filed May 31, 2019) (“Because whether a taking occurred is a question of law, we reject the Fritzes’ contention that the case should have been tried by a jury.”). Furthermore, the district court may rely on unpublished orders for its persuasive value. See RJRN Holdings, LLC v. Bank of New York Mellon, No. 76883-COA at 2 n.2 (Nev. App. filed Jan. 8, 2020). 2 The special verdict additionally found in favor of the Plaintiffs on conversion, but in favor of the City on the claims of trespass and nuisance. 3 In deciding the date of valuation, the law is clear, NRS 37.120(1)—which allows valuation to be made as of the time of the trial in proceedings not brought to trial within a two-year period— applies where the delay in bringing the action to trial is caused by the government. Clark Cty. v. Alper, 100 Nev. 382, 391, 685 P.2d 943, 949 (1984) (“NRS 37.120(1)(b) places the burden on the government to move the case to trial within two years after the action is commenced. If it does not, and the delay is not primarily caused by the actions of the landowner, the government must account for the increased value of the property.”).
  5. 5. 5 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Around the same time, the City also sought guidance on what property interest it could expect to obtain if and when it paid just compensation for the taking. Over Plaintiffs’ argument that the City did not obtain any prospective interest in the real property after inverse condemnation, the City argued for a flowage easement, allowing it use of class members’ property in the future without additional compensation. This Court rejected that argument, holding that the payment of just compensation would not grant the City any future property interest (or if it did, the amount of compensation would drastically increase). The Court opined that the City’s interest was analogous to a retroactive license for the time period the properties were physically invaded by flood waters. The Court determined that based on the evidence at that time, the taking was temporary in duration. Before the damages trial, the City filed a motion in limine to argue that just compensation should be limited to the rental value of the property. After considerable review of Nevada and national authorities, the Court rejected that argument and held that damages would properly include: (1) the fair rental value of the taken property during the time it suffered a substantial restriction to use, access or enjoyment; (2) severance damages to any portions of the property adversely impacted by the taking; (3) relocation or abatement costs incurred; and (4) attorneys’ fees, costs, and interest. These four categories of damages made up “just compensation” and served, as required by NRS 37.120(3) and Article I Section 22 of the Nevada Constitution, to place the class members in the position as though the inverse condemnation had not occurred. In January 2020, after a continuance of the damages trial, the City again moved to decertify the class. The Court agreed that individual proof of the amount of damages suffered by the property owners was more manageable for the purposes of logistics. It also reasoned that circumstances had changed such that maintaining the action as a class was no longer in the interest of justice. As such, the Court decertified the class. Nevertheless, in making that order, the Court confirmed that the determination of the City’s liability for the entire class was not in question. Indeed, the decertification was based in large part on the conclusion that whether the City was responsible for damage to the class members’ properties was no longer an open question, as the
  6. 6. 6 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 jury and this Court held that the City was liable for inverse condemnation and conversion of the class members’ properties. The Court gave the Plaintiffs leave to amend to bring claims for each individual member of the class; however, those other class members declined to participate4. The damages phase proceeded with respect to only the three properties of the Class Representatives: the Johnsons, the Walls, and Donna Robinson. I. PLAINTIFFS’ MOTION TO STRIKE CITY’S REBUTTAL EXPERTS RAYMOND PEZONELLA AND ANTHONY WREN Before the Court are the Plaintiffs’ October 13, 2020, Motion to Strike City’s Rebuttal Expert Raymond Pezonella and October 14, 2020, Motion to Strike City’s Rebuttal Expert Anthony Wren. The Plaintiffs moved to strike both Pezonella and Wren on two grounds: first, untimely disclosure, and second, the testimony and reports do not meet the requirements of Hallmark v. Eldridge, 124 Nev. 492 (2008). The City opposed the Motion and the Court heard oral argument on the matter on December 14, 2020. Nevada Rule of Civil Procedure 16.1(a)(2) requires the automatic and simultaneous disclosure of expert witnesses. A party cannot wait to disclose an expert in rebuttal if the expert’s “purpose is to contradict a portion of another party’s case in chief that should have been expected and anticipated by the disclosing party . . . .” NRCP 16.1(a)(2)(E)(2). Moreover, a rebuttal expert may not “present any opinions outside of the scope of another party’s disclosure.” Id. Pursuant to this Court’s Case Management Order of November 25, 2019, the parties were required to exchange NRCP 16.1(a)(2) initial expert witnesses on July 16, 2020.5 The City produced and served initial expert disclosures naming Wren as a retained expert. Wren provided only a “retrospective rent analysis” of each of the Plaintiffs’ properties. Wren did not provide any opinion as to pre-flooding fair market value nor offer any opinion of diminution of fair market value due to the flooding. On July 17, 2020, Plaintiffs’ counsel requested to take the deposition of Anthony Wren. Instead, on 4 Apparently, several chose to file actions in federal court under 42 U.S.C. § 1983. 5 This date was extended by stipulation of the parties from June 1, 2020.
  7. 7. 7 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 August 19, 2020, the City filed and served notice to withdraw Anthony Wren and his reports as a NRCP 16.1(a)(2)(B) initial expert witness. On September 1, 2020, the City served rebuttal expert disclosures naming Wren, Raymond Pezonella, and William Kimmel6 as rebuttal experts. A. Wren The City’s rebuttal disclosure stated that “Wren will provide direct and rebuttal opinions regarding any and all matters addressed in his written report.” The City’s disclosure does not identify or state that Wren will be offering rebuttal testimony to any of Plaintiffs’ initial experts. Wren’s rebuttal report consisted of a pre-flooding retrospective appraisal of the Wall’s improved property dated October 31, 2019, and also as a pre-flooding retrospective appraisal of the Wall’s property with the “hypothetical assumption . . . as though the property was vacant land and not improved” dated August 10, 2020. Wren did not offer any opinion on the Johnsons’ or Robinson’s property. Wren did not include any review of Plaintiffs’ initial expert reports in his listing of facts or data considered or as an exhibit as required by NRCP 16.1(a)(2)(B)(ii) and (iii). Plaintiffs’ counsel took the deposition of Wren on October 6, 2020. Wren admitted that he did not provide any opinion or analysis on the diminution of value of the property caused by the flooding. Wren further testified at his deposition that his rebuttal report was not created as a critique or analysis of any of Plaintiffs’ expert reports. B. Pezonella The City did not disclose Pezonella as an initial expert. The City’s rebuttal disclosure for the Johnsons and Robinson stated that “Pezonella will provide direct and rebuttal opinions regarding any and all matters addressed in his written report.” Said disclosure does not identify or state that Pezonella will be offering rebuttal testimony to any of Plaintiffs’ initial experts. Pezonella did not include any review of Plaintiffs’ initial expert reports in his listing of facts or data considered or as an exhibit as required by NRCP 16.1(a)(2)(B)(ii) and (iii). The retention letter between the City and Pezonella does not include within the scope of service any rebuttal of the 6 Kimmel was only disclosed as to Donna Robinson’s property. Plaintiffs did not move to strike Kimmel and his opinion is not relevant to the decision herein.
  8. 8. 8 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Plaintiffs’ initial expert reports. Pezonella offered two reports, one for the Johnsons’ property, and one for Robinson’s property. Neither report addresses, critiques or criticizes the Plaintiffs’ expert reports. Both reports address foundation and septic issues on the properties. Pezonella’s scope of analysis and investigation was limited to a visual observation of the properties and communications with third parties. Plaintiffs deposed Pezonella on October 6, 2020. In deposition, Pezonella admitted under oath that the focus of his reports was not to rebut Plaintiffs’ expert reports. Pezonella admitted that the scope of his investigation was limited to visual observations, reviewing public documents and talking to third parties. Pezonella admitted that he took no measurements, did no testing or sampling, and did not confirm the accuracy of the third-party statements. To be admissible at trial, proffered expert reports must meet three requirements. First the expert must be properly disclosed pursuant to NRCP 16.1(a)(2). Second, the expert must be qualified and, third, the expected testimony must assist the trier of fact. Hallmark v. Eldridge, 124 Nev. 492, 500 (2008). To assist the trier of fact, the proffered testimony must be relevant to the claims or defenses and the product of reliable methodology. Id. This is a “gatekeeping” function to ensure that only relevant and reliable expert opinion is presented at trial. See Daubert v. Merrell Dow Pharmaceuticals, Inc., 509 U.S. 579, 125 L. Ed. 2d 469, 113 S. Ct. 2786 (1993) (holding that the trial court must act as a gatekeeper to exclude expert opinions that may not be relevant, assist the trier of fact, or are not reliable). A party cannot wait to disclose an expert in rebuttal if the expert’s “purpose is to contradict a portion of another party’s case in chief that should have been expected and anticipated by the disclosing party . . . .” NRCP 16.1(a)(2)(E)(2). Moreover, a rebuttal expert may not “present any opinions outside of the scope of another party’s disclosure.” Id. Rebuttal experts may only “contradict or rebut evidence on the same subject matter identified by another party.” NRCP 16.1(a)(2)(E)(i)(b). Disclosure of expert reports and their opinions must be made in an initial disclosure if the information and opinions are central to a party’s case in chief. See id. “A defense witness whose purpose is to contradict an expected or anticipated portion of the plaintiff’s case in chief can never be considered a ‘rebuttal expert’ or anything analogous to one.”
  9. 9. 9 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Morgan v. Commercial Union Assurance Companies, 606 F.2d 554, 555 (5th Cir. 1979) (emphasis added); see also In re Apex Oil Co., 958 F.2d 243, 245 (8th Cir. 1992).7 This issue has been thoroughly explored in the federal district court in Nevada. See e.g. Campbell v. Garcia,, No. 3:13-CV-00627-LRH, 2015 WL 995244 (D. Nev. Mar. 6, 2015); Downs v. River City Group, LLC, et al., No. 3:11-CV-00885-LRH, 2014 WL 814303, at *2 (D. Nev. Feb. 28, 2014); Amos v. Makita U.S.A., Inc., No. 2:09-CV-01304-GMN, 2011 WL 43092, at *2 (D. Nev. Jan. 6, 2011) (quoting In re Apex Oil Co., 958 F.2d 243, 245 (8th Cir. 1992)).“[R]ebuttal expert witness testimony is “limited to new, unforeseen facts brought out in the other side’s case.” Cates v. Sears, Roebuck & Co., 928 F.2d 679, 685 (5th Cir. 1991) (internal quotation omitted). The rebuttal expert disclosure date is not intended to provide an extension of the deadline by which a party must deliver the lion’s share of its expert information. Sierra Club, Lone Star Chapter v. Cedar Point Oil Co., Inc., 73 F.3d 546, 571 (5th Cir. 1996). Rebuttal experts cannot testify in their parties’ case in chief. Lindner v. Meadow Gold Dairies, Inc., 249 F.R.D. 625, 636 (D. Haw. 2008). “Rebuttal testimony cannot be used to advance new arguments or new evidence.” Huawei Techs., Co, Ltd v. Samsung Elecs. Co, Ltd., 340 F. Supp. 3d 934, 995 (N.D. Cal. 2018). Portions of an expert’s rebuttal that opine on subjects that were not addressed in the expert report purportedly being rebutted may be excluded. Plumley v. Mockett, 836 F. Supp. 2d 1053, 1065 (C.D. Cal. 2010) (citing First Years, Inc. v. Munchkin, Inc., 575 F. Supp. 2d 1002, 1008 (W.D. Wis. 2008)). The scope and substance of rebuttal disclosures are “limited to ‘new, unforeseen facts brought out in the other side’s case.’” Cates, 928 F.2d at 685, infra. A review of the City’s expert reports and admissions by their experts clearly shows that Wren and Pezonella’s reports were not rebuttal in nature. Wren, in offering the “land-only” opinion, exceeded the scope of the Plaintiffs’ expert appraisal opinion and offered a new theory and argument not presented by the Plaintiffs. Pezonella offers only opinions of issues related to foundations and septic systems that were known 7 Because the Nevada Rules of Civil Procedure are based in large part upon their federal counterparts, lower courts in Nevada have been directed by the Nevada Supreme Court to view those decisions as “strong persuasive authority.” See Exec. Mgmt. v. Ticor Title Ins. Co., 118 Nev. 46, 53, 38 P.3d 872, 876 (2002) (quoting Las Vegas Novelty, Inc. v. Fernandez, 106 Nev. 113, 119, 787 P.2d 772, 776 (1990)).
  10. 10. 10 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 and disclosed by Plaintiffs through the course of discovery many months before the initial expert disclosure deadlines and should have been expected and anticipated by the City. Clearly, the City did expect those subjects because the City sought leave to conduct such discovery before the liability trial. Although that discovery was not necessary for the liability phase, in which substantial injury was at issue and not the amount of damages, the Court rejects the City’s assertion that it could not have anticipated needing such discovery. The City’s rebuttal expert disclosures with respect to Wren and Pezonella failed to meet the timeliness requirements of NRCP 16.1(a)(2)(E)(2) as the City should have expected and anticipated those portions of Plaintiffs’ case in chief. The rebuttal expert disclosures failed to meet the scope requirements of Rule 16.1(a)(2)(e)(i) as the substance of the opinions was not “intended solely to contradict or rebut evidence on the same subject matter identified” by Plaintiffs in their initial expert reports. If properly and timely disclosed, to be admissible, expert testimony must both be relevant and the product of reliable methodology. Hallmark, 124 Nev. at 500. In determining whether an expert's opinion is based upon reliable methodology, a district court should consider whether the opinion is (1) within a recognized field of expertise; (2) testable and has been tested; (3) published and subjected to peer review; (4) generally accepted in the scientific community (not always determinative); and (5) based more on particularized facts rather than assumption, conjecture, or generalization. Id. at 501 (internal citations omitted). The City, as the party offering the expert testimony, has the burden to prove not only that its experts’ methodologies are reliable for some purposes, the City must also show that those methodologies are reliable ways “to draw a conclusion regarding the particular matter to which the expert testimony was directly relevant.” Kumho Tire Co. v. Carmichael, 526 U.S. 137, 154 119 S. Ct. 1167 (1999). Pezonella’s proffered testimony and report fail to meet the Hallmark standards for admissibility. Pezonella provides no discussion of any scientifically sound methodology or testing. He admits that his opinions are based only on visual observations and hearsay. Where visual observations alone make up the basis of the expert opinion, there is no scientifically sound and methodologically reliable support for the opinion. BASF Corp. v. Sublime Restorations, Inc., 880
  11. 11. 11 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 F. Supp. 2d 205, 214 (D. Mass. 2012) (excluding expert that based his opinion on the visual comparison of paint colors); Precision Fabrics Grp., Inc. v. Tietex Int'l, Ltd., No. 1:13-CV-645, 2016 WL 6839394, at *1 (M.D.N.C. Nov. 21, 2016) (excluding expert opinion based on the visual observation of material changes in heat); Kumho Tire Co. v. Carmichael, 526 U.S. 137, 154 119 S. Ct. 1167 (1999) (finding expert's testimony based on “simple visual-inspection methodology” unreliable and therefore inadmissible). “[T]he unremarkable observation that an expert may be qualified by experience does not mean that experience, standing alone, is a sufficient foundation rendering reliable any conceivable opinion the expert may express.” United States v. Frazier, 387 F.3d 1244, 1260-61 (11th Cir. 2004). Pezonella’s testimony is rejected on this additional basis. The City had the burden of showing that the proffered testimony was timely disclosed and the product of reliable methodology. The Court finds the City has failed to meet that prerequisite burden. Pursuant to NRCP 16.1(e)(3), 37(b) and Hallmark v. Eldridge, 124 Nev. 492 (2008), the Court finds that striking Anthony Wren and Raymond Pezonella from providing any testimony is warranted. II. THE CITY’S MOTION TO SET THE DATE OF TAKING The City moved to set the date of taking and Plaintiffs moved for summary judgment on the basis of a start date for the taking of February 13, 2017, which the Court found to be supported by the evidence presented during the liability trial and as exhibits to the motions for summary judgment. At oral argument on the Motions for Summary Judgment, the Plaintiffs agreed that although an earlier date of taking might be provable, there was no objection to setting the date of taking as February 13, 2017, for the Walls and Johnsons and February 21, 2017, for Donna Robinson in the consideration of summary judgment. Therefore, the Court grants the City’s motion and sets the date of taking, from which runs the accrual of interest, as February 13, 2017, for the Johnsons and the Walls and February 21, 2017, for Donna Robinson. Because the parties conceded that for the purposes of summary judgment the above dates of taking, the Court makes no specific finding whether the actual physical invasion of the flood waters resulting in a taking occurred prior to the dates listed.
  12. 12. 12 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 III. THE PLAINTIFFS’ MOTION TO SET THE DATE OF VALUATION The Plaintiffs filed their motion to set the date of valuation on August 1, 2019, the City opposed, and the Court entertained argument on August 21, 2019. The Plaintiffs sought a determination that the date of valuation was the date of the liability trial, arguing that the City’s discovery abuses had caused significant delay. The Court determined that the delay could not be solely blamed on the City and orally pronounced that the date of service of the complaint would be used to value the taken property, i.e., June 5, 2017. The Court indicated that the Plaintiffs would be free to renew the motion in the light of any future delays. Discovery in the damages phase was conducted, expert reports were prepared, and summary judgment was granted based upon this Court’s August 21, 2019, oral order setting the date of valuation as June 5, 2017. Plaintiffs have conceded that for purposes of the motions for summary judgment, they will rely on the June 5, 2017, date of valuation. In its December 31, 2020, Order, however, this Court erroneously set the for date of valuation as the start of trial, June 10, 2019. The Court withdraws this portion of the Summary Decision and finds the date of valuation should be on June 5, 2017 as previously stated in its previous oral pronouncement. IV. THE PLAINTIFFS’ MOTION TO DISQUALIFY WILLIAM MCKEAN Before the Court is the Plaintiffs’ October 16, 2020, Motion to Disqualify William McKean as Trial Counsel. The Plaintiffs moved to disqualify William McKean, Deputy City Attorney, as trial counsel in this matter on the basis that McKean was a necessary witness who was actively involved in communications and negotiations with the subsequent purchaser of the Property previously owned by the Johnsons. The City opposed the Motion and the Court heard oral argument on December 22, 2021. After receiving discovery responses from the City on or about October 5, 2020, which included emails regarding valuation of the property between McKean and a named witness, the subsequent purchaser of the Johnsons’ property, the Plaintiffs named McKean as a witness and moved to have him disqualified as trial counsel. The City argued that disqualification was inappropriate and, if any, should be limited to Johnsons’ portion of the trial. Concurrently with
  13. 13. 13 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 this Motion, Plaintiffs moved for summary judgment on the value of damages. The Court has ruled in favor of Plaintiffs on all issues related to that summary judgment. Although McKean’s interactions might be modestly relevant to issues in the case, the Court finds that those interactions do not warrant disqualification. Pursuant to NRCP 3.7, a lawyer is generally enjoined from acting as an advocate at a trial where he is likely to be a necessary witness. Here, the Court is unconvinced McKean’s interactions would elevate him to a necessary witness for two reasons: First, the Court has made it abundantly clear that its determination of a taking is not to be re-litigated in the remaining damages phase of this case. See Order Affirming Rec’n for Order (Sept. 24, 2020) at 5. As such, any testimony by McKean that would bear on the nature of the taking (or the damages caused thereby) is not relevant to any issue to be resolved in the damage phase of trial. Second, Plaintiffs have failed to show that McKean qualifies as an expert to opine as to the fair market value of 415 Pompe and 11625 Tupelo and/or any depreciation in their value. See Meredith v. Washoe Cty Sch. Dist., 84 Nev. 15, 435 P.2d 750, 752 (1968) (“The measure of compensation is the value of the interest that is extinguished [looking] to the market value of the dominant tenement before and after the taking.”). Accordingly, the Court rejects Plaintiffs’ challenge to disqualify William McKean.8 V. THE PLAINTIFFS’ MOTIONS FOR SUMMARY JUDGMENT In the second phase of this bifurcated action, the issue before the Court is the value and scope of damages caused by the 2017 flooding in Lemmon Valley for which the City has been found liable to the entire class. The Court affirms that Plaintiffs proved beyond a preponderance of the evidence at the liability trial that the class members sustained a taking under both the United States and Nevada constitutions. This Court found that the weight of evidence showed the physical invasion of flood waters caused a substantial interference with the use, enjoyment or value of the class members’ properties for a continuous period of time. Therefore, the issue on 8 The Court has considered the other arguments advance by Plaintiffs for disqualification and finds them to be without merit.
  14. 14. 14 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 which Plaintiffs sought summary judgment was the value of the damages and award of just compensation. The City raised several legal arguments challenging Plaintiffs’ motions for summary judgment, but effectively conceded it did not have evidence to challenge the Plaintiffs’ factual positions. Under NRCP 56(a), an order granting summary judgment is proper when there are no genuine issues of material fact and the moving party is entitled to judgment as a matter of law. See also Wood v. Safeway, Inc., 121 P.3d 1026, 1030, 121 Nev. 724, 731 (2005). As set forth below, the Court rejects the City’s legal challenges and finds the evidence presented by Plaintiffs, substantively undisputed by the City, shows no genuine issue of material fact and establishes their right to judgment as a matter of law. A. Physical Invasion by Flooding That Caused Substantial Injury to Plaintiffs’ Properties Is a Taking Despite the jury finding and the Court’s rulings, the City has continued to argue that because of the temporary nature of the flooding, no taking occurred. The City misinterprets the prior rulings of this Court. Referring to the Court’s example of the property interest the City took without compensation, a sort of temporary retroactive license, the City asserts that such a taking is not a cognizable property interest sufficient to support a taking claim. As stated previously and repeatedly, the Court’s description of the property interest as a temporary retroactive license is an analogy to address the City’s motion to determine its property interest in the Plaintiffs’ properties. Temporary physical takings that cause substantial injury are compensable under both the Nevada and United States constitutions, thus the City’s assertion is without merit. Under Nevada law, a taking occurs “where real estate is actually invaded by superinduced additions of water . . . so as to effectually destroy or impair its usefulness” Cty. of Clark v. Powers (“Powers”), 96 Nev. 497, 501, 611 P.2d 1072, 1075 (1980), see also ASAP Storage, Inc. v. City of Sparks, 123 Nev. 639, 647, 173 P.3d 734, 740 (2007) (“a taking occurs when there is a physical appropriation of property by the government”). “Nevada law requires a plaintiff in a takings action involving the drainage of surface waters to show both a physical invasion of flood waters and resulting substantial injury.” Buzz Stew, LLC v. City of N. Las Vegas (“Buzz Stew II”), 131 Nev. 1, 7,
  15. 15. 15 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 341 P.3d 646, 651 (2015) (citing Cty. of Clark v. Powers, 96 Nev. 497, 501 n.3, 504, 611 P.2d 1072, 1075 n.3, 1076 (1980); ASAP Storage, Inc., 123 Nev. at 647-48, 173 P.3d at 739-40). “Substantial injury” exists where government interference with property rights is “‘permanent, continuous, or inevitably recurring. . . .’” ASAP Storage Inc., 123 Nev. at 649, 173 P.3d at 741 (quoting Rocky Mountain Thrift v. Salt Lake City, 784 P.2d 459, 459–60, 465 (Utah 1989)). This Court previously found that the Plaintiffs proved the flood waters actually physically invaded their private property for time periods not less than eight weeks for Robinson and more than nine months for the Walls and Johnsons. The Court balanced the temporal duration of the actual physical invasion with the evidence of foreseeability of the flooding, the character and severity of the impacts of the flooding, and the fact that the Plaintiffs’ flooded properties were unusable for their zoned residential purposes during the flooding. The Court finds the time periods of flooding are not de minimus and are “continuous” for the purposes of finding that Plaintiffs suffered a substantial injury. The factual basis for this finding is more fully set forth in the Findings of Fact and Conclusions of Law issued by this Court on July 30, 2019. In opposition to the current Motions for Summary Judgment, the City relies on Sloat v. Turner, 93 Nev. 263, 563 P.2d 86 (1977), to argue that only actual physical injury to the property or some derogation of a right appurtenant to that property is compensable. Because the Court previously found that physical injury occurred due to the flooding and that flooding deprived the property owners of many, if not most, of the rights appurtenant to their properties, the decision in Sloat is factually and legally distinguishable from the facts in this case. First, in Sloat, the Nevada Supreme Court determined that there had been no physical invasion of property or interference with any property right held by the Sloats. 93 Nev. at 268, 563 P.2d at 90. The Supreme Court rejected the argument that a property owner was entitled to compensation when a freeway was constructed near their property because there had been no physical invasion or interference. Id. In contrast, in these cases it is undisputed that there was an actual physical invasion of water on the class members’ properties and that invasion caused both physical damages and the degradation of the private property rights inherent to ownership. The Sloat decision supports the determination that a taking occurred in this case because the City’s actions unquestionable interfered with the
  16. 16. 16 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Plaintiffs’ property rights and the physical invasion onto their properties caused compensable damage. See 93 Nev. at 267-68, 563 P.2d at 89. The City further argues that under ASAP Storage Inc., a physical invasion that is not permanent or inevitably recurring cannot constitute a taking. As discussed above, this Court previously concluded that the temporary nature of flooding is one consideration of whether that flooding caused substantial injury. The City’s position would improperly read “continuous” out of the holding in ASAP Storage Inc. Like the decision in Sloat, the decision in ASAP Storage Inc. is both factually and legally distinct from this matter. The issues in ASAP Storage Inc. concerned the government excluding owners from property for mere days because of safety concerns due to flooding of which the government was not a cause. In this case, the City caused a physical invasion of flood waters on the class members’ properties. Moreover, the nature of the flooding in this case was not de minimis in duration or scope of injury and is sufficient to constitute a taking in violation of Art. I, Section 8(3) of the Nevada Constitution. See ASAP Storage Inc., 123 Nev. at 649, 173 P.3d at 741; Powers, 96 Nev. at 501, 611 P.2d at 1075; see also Ladd v. United States, 630 F.3d 1015, 1025 (Fed. Cir. 2010) (“[P]hysical takings are compensable, even when temporary. . . . The duration of the taking goes to damages, not to whether a compensable taking has occurred.”). This Court also found a taking under the Fifth Amendment of the United States Constitution. “Ordinarily . . . if government action would qualify as a taking when permanently continued, temporary actions of the same character may also qualify as a taking.” Arkansas Game & Fish Commission v. United States, 568 U.S. 23, 25, 133 S. Ct. 511, 184 L. Ed. 2d 417 (2012) “[T]he distinction between ‘permanent’ and ‘temporary’ takings refers to the nature of the intrusion, not its temporal duration. A ‘permanent’ physical occupation, as distinguished from a mere temporary trespass, involves a substantial physical interference with property rights.” Skip Kirchdorfer, Inc. v. United States, 6 F.3d 1573, 1582 (Fed. Cir. 1993). A taking therefore occurs under federal law where government actions lead to flooding of private lands in which the flooding limits access to or use of real or personal property in its intended manner for more than a de minimis period of time. Id. at 39. As discussed above, and as the Court and the jury expressly concluded, that standard has been met in this case on behalf of each class member. The Court found that a taking of private
  17. 17. 17 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 property without just compensation in violation of the Fifth Amendment of the Constitution of the United States was established by a preponderance of the evidence. B. Decertification of the Class Has No Effect on the Liability Verdict The City also argues that this Court’s decision to decertify the class for the purpose of presenting damages required a new liability trial for each Plaintiff. The City failed to cite any authority for this proposition and the Court roundly rejects this argument. Class certification was based primarily on the predominance of the common question in the liability phase of whether the City proximately caused the physical intrusion of waters onto the class members’ property. The Plaintiffs, as Class Representatives, offered evidence at trial in support of those claims. The question was presented to the jury and the jury found in favor of the class. At the time that question was presented, there were more than fifty property owners that had affirmatively made claims and potentially more than one hundred fifty owners of parcels fitting the class definition. The Court sees no valid argument that the Class Representatives claims were not typical of the class as a whole. As stated supra, at 5-6, the Court decertified the class, inter alia, because of concerns that maintaining the action as a class was no longer in the interest of justice. The Court’s decertification of the class for the purposes of proving the value of damages in no way undermined the liability finding in the favor of any member of the class. C. Amount of Just Compensation Pursuant to state law, once the taking has been found, the Plaintiffs are entitled to just compensation. Nev. Const. Art. I, Section 8(3); NRS 37.120(3); City of N. Las Vegas v. 5th Centennial, LLC, 130 Nev. 619, 623, 331 P.3d 896, 899 (2014). Just compensation is defined as that sum of money necessary to place the property owner in the same position monetarily as if the property had never been taken, excluding any governmental offsets except special benefits.” NRS 37.120(3); Nev. Const. Art. I, Sec. 22(4); see also Olson v. United States, 292 U.S. 246, 255 (1934) (just compensation defined as that sum to make an owner whole). On previous motion by the City to limit the scope of damages evidence, this Court ruled that the following categories of damages could be sought by Plaintiffs: (1) the value of the real estate taken; NRS 37.110(1);
  18. 18. 18 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 (2) those severance damages or diminution to the remainder of property interest if the entire property interest is not taken; NRS 37.110(3); (3) compensable damages actually incurred by the private property owner; Nev. Const. Art. I, Sec. 22(4); NRS 37.110(3); (4) compound interest along with costs and fees of the inverse condemnation action. NRS 37.185; City of Las Vegas v. Cliff Shadows Prof’l Plaza, Ltd. Liab. Co., 129 Nev. 1, 6, 293 P.3d 860, 863 (2013). (Order Granting-in-Part and Denying-in-Part City of Reno’s Motion in Limine Re: Damages Evidence, filed January 27, 2020).9 Upon motion for summary judgment the Plaintiffs have sought damages in each of the first three categories and reserved for further determination by the Court those attorneys’ fees and costs to be awarded. The City makes two general legal arguments regarding damages to the Plaintiffs. For the reasons set forth below, the Court declines to accept the City’s positions. 1. Just Compensation Includes Severance Damages Based on the Injury to the Property Returned to or Retained by the Plaintiffs The City argues that the Plaintiffs have no legal right to severance damages. Under Nevada law, where the taking is a partial taking, the private property owner recovers “not only the value of the land actually taken, but also the amount by which the remaining parcel is diminished in value by virtue of the severance.” M & R Investment Co. v. State Dep’t Transp., 103 Nev. 445, 449, 744 P.2d 531, 534 (1987); see also NRS 37.110; Andrews v. Kingsbury Gen. Improvement Dist. No. 2, 84 Nev. 88, 89-90, 436 P.2d 813, 814 (1968). The definition of partial taking is not limited to physical 9 The Court is aware this determination differs slightly from its prior Order. The Court notes it has authority to revisit Orders in limine before trial, as well as the fact that it materially reflects the Court’s intended ruling. See Pineda v. State, 120 Nev. 204, 209, 88 P.3d 827, 831 (2004) (“…pretrial rulings in limine do not bind a district court and may be reversed or modified at trial…”); See Staude v. State, 112 Nev. 1, 5, 908 P.2d 1373, 1376 (1996), holding modified by Richmond v. State, 118 Nev. 924, 59 P.3d 1249 (2002) (“A ruling on a motion in limine is advisory, not conclusive.”); see also Deere & Co. v. FIMCO Inc., 260 F. Supp. 3d 830 (W.D. Ky. 2017) (“A ‘ruling in limine’ is no more than a preliminary, or advisory, opinion, so that the district court may revisit its in limine rulings at any time and for whatever reason it deems appropriate.”).
  19. 19. 19 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 acreage, but a taking can be partial in duration or fact, where the activities of the condemner result in a demonstrable diminution in the value of the property. Farmland Preservation Ass’n v. Goldschmidt, 611 F.2d 233, 237 (8th Cir. 1979) (“[T]he landowner is entitled to be compensated not only for the value of his land that is actually taken, but also for the diminution of the value of what is left to him after the taking.”). Severance damages equal the diminution in value to the remainder of the untaken real property as a result of the taking. M & R Investment Co., 103 Nev. at 449, 744 P.2d at 534. The requirement is not different if the partial taking is temporal (the taking of a whole property for a period of time) or geographic (the taking of a portion of property). See Kimball Laundry Co. v. United States, 338 U.S. 1 (1949). Severance damages serve to ensure that a property owner is compensated not for what the government obtained, but for what the property owner lost in the taking. Brown v. Legal Found. of Washington, 538 U.S. 216, 236 (2003) (it was common ground that the government should pay “not for what it gets but for what the owner loses.” (quoting Kimball, 338 U.S. at 23 (Douglas, J., dissenting))); Kimball, 338 U.S. at 6 (holding that fair market rental value alone is not always sufficient for just compensation). Severance damages can be measured by difference in the pre-taking and post-taking valuation of the entire parcel; the lost profits or rents to a commercial property; or by the cost to cure the physical damages caused by the physical invasion. See McCann Holdings, Ltd. v. United States, 111 Fed. Cl. 608, 614 (2013) (holding that the cost to cure or mitigate damage is alternative means to quantify severance damages); State Highway Comm v. Speck, 324 S.W.2d 796 (Ark. 1959); Dep’t of Transp v Sherburn, 196 Mich. App. 301, 305-306, 492 N.W.2d 517 (1992) (explaining that severance damages are measured by the “cost to cure” or the diminution in value of the remainder of the property). In addition to the legal authorities, both Plaintiffs’ expert, John Wright, and the City’s expert, William Kimmell, opined that cost to cure is the appropriate method to determine the after-taking value of real property and establish the amount of severance damages. Despite its expert’s concession, the City nonetheless argued that cost to cure was an inappropriate method to value any remainder because the Plaintiffs failed to demonstrate the connection of the cost to cure with the fair market value of the property after the taking. Through expert testimony, Plaintiffs established that any purchaser of their properties would discount the
  20. 20. 20 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 property’s sales price by the cost of necessary repairs and an entrepreneurial incentive. See J.D. Eaton, MAI, Real Estate Valuation in Litigation, p. 296 (Appraisal Institute, 2nd ed. 1995) (“If a property with a deficiency [due to taking] is placed on the market, both the buyer and seller will consider the cost to cure the deficiency, if it is physically and economically curable” when negotiating a sale.); Uniform Appraisal Standards for Federal Land Acquisitions § 4.4.3.5, p. 135 (U.S. Government Printing Office 2016); see also United States v. 1.604 Acres of Land (Granby I), 844 F. Supp. 2d 668, 682-84 (E.D. Va. 2011). This approach is logical to the Court where the evidence demonstrates that flooding caused physical damages to the real property and its appurtenances, but the property owners were eventually allowed exclusive possession of the properties. The Court is satisfied that the cost to cure approach, where the property was not later sold, is a fair and reasonable measure of the severance damages. See Schwartz v. State, 111 Nev. 998, 1002, 900 P.2d 939, 942 (1995); Kinter v. United States, 156 F.2d 5, 7 (3d Cir. 1946). The evidence presented both during the liability phase and in support of the motion for summary judgment leaves no question that the flooding damaged the Plaintiffs’ properties, negatively impacting the property values. The City presented no evidence to establish an after-taking value of any of the properties.10 The weight of evidence shows that while the taking may have been temporary in duration, the properties suffered a diminution in fair market value between their pre-flood condition and post-flooding when the property was returned to the Plaintiffs. That diminution results in severance damage to the property as a part of the whole. Plaintiffs’ expert appraiser opined that due to the lack of sufficient relevant comparable sales data points in post-flooded unrepaired condition, the most appropriate method of measuring the after-taking value of the property was 10 The City additionally challenged the Plaintiffs’ expert’s use of an entrepreneurial incentive as part of the cost to cure damages. After much reflection, the Court finds the weight of the case law and treatises offered by the Plaintiffs support the use of an entrepreneurial incentive value since the property owner is likely to take a lower purchase price of the unrepaired property instead of risking the additional costs and delays commonly associated with repairs on the scale presented in this case. Furthermore, the City did not offer any evidence that entrepreneurial incentive is never applicable, the City’s expert merely disputes the value assigned by the Plaintiffs without offering any contrary amount. The Court finds the 50 percent value of cost of repairs to be reasonable given the risk of delay and increased costs likely to be incurred by the Plaintiffs or a subsequent purchaser of the unrepaired properties.
  21. 21. 21 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 measuring the cost to repair to the property to a pre-flooded condition. This position is supported by case law, learned treatise and not materially disputed by the City’s expert. The Plaintiffs are entitled to severance damages as proven by a preponderance of the evidence. 2. Just Compensation Under Nevada Law Requires Payment of Consequential Damages Nevada law requires the condemner to pay all damages to place the property owner in the position as if the taking had never occurred. Nev. Const. Art. I, Sec. 22(4); NRS 37.120(3). This specifically includes all reasonable costs and expenses actually incurred as a result of the taking. Nev. Const. Art. I, Sec. 22(4); NRS 37.120(3). These two statements are patently clear that the Plaintiffs are entitled to recover those costs that naturally and reasonably resulted from the taking. This result makes practical sense in a flooding condemnation matter where the Plaintiffs’ evidence proves they had to evacuate; move and store belongings, vehicles and animals; rent additional temporary living and storage space, maintain multiple residences; and clean and repair essential services to make the property habitable again after flood waters receded. The Plaintiffs would not have incurred these costs if the taking had never occurred. Therefore, the Court concludes recovery of out-of-pocket expenses is necessary to place the Plaintiffs in the position as if the taking had never occurred. See Nev. Const. Art. I, Sec. 22(4); NRS 37.120(3). The City argues, without citation to any Nevada authority, that such compensation would only be appropriate in an award for a tort. Given the unequivocal language in the Nevada Constitution and NRS 37.120, this Court must award all amounts necessary to place the property owners in a position as if the taking had not occurred. D. The Plaintiffs Presented Evidence Supporting the Award of Damages The City relied on legal challenges to the calculation of damages, asserted that the Plaintiffs had not met their burden of proof of damages, and conceded during oral argument that it was without factual evidence to dispute the Plaintiffs’ claimed amounts. The City could not rely on the factual assertion by its attorneys and the allegations in its pleadings to resist summary judgment. See Hampton v. Washoe Cty., 99 Nev. 819, 672 P.2d 640 (1983); A Minor v. State, 85 Nev. 323, 454 P.2d 895 (1969). This Court finds that the Plaintiffs are entitled under the law to the following
  22. 22. 22 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 categories of damages: (1) the fair rental value of the taken property during the time it suffered a substantial restriction to use, access or enjoyment; (2) severance damages to any portions of the property adversely impacted by the taking; (3) relocation or abatement costs incurred; and (4) attorneys’ fees, costs, and interest. Plaintiffs have met their burden and the City failed to demonstrate the genuine dispute of any material fact, summary judgment for the Plaintiffs is awarded as set forth below. 1. The City Conceded to the Awards, Amounts, and Duration of Rental Values for the Temporary Taking to Each Plaintiff For each of the Plaintiffs, the City conceded to the fair market value of the property at the date of valuation, the monthly rental value, and the start date of the taking.11 There being no dispute of material fact, the portion of the first category of just compensation for the rental value of the real property taken by the City is awarded to the Johnsons in the amount of $14,850.00 ($1,350.00 x 12 months) and Donna Robinson in the amount of $20,600.00 ($2,060.00 x 10 months). The Walls have been unable to return to their home since they evacuated in February 2017. The City expressly conceded to the award of twelve months of the conceded rental value, $865.00/month,12 however, it did not concede to the forty months for which the Walls have been unable to live in their home. The City does not refute that the Walls have been unable to fix the damage to their home, remove the sandbags that create a physical barrier to the home (and were only placed there to 11 The City moved to set the date of taking and Plaintiffs moved for summary judgment on the basis of a start date for the taking of February 13, 2017, which the Court found to be supported by the evidence presented during the liability trial and as exhibits to the motions for summary judgment. Therefore, the Court grants the City’s motion and sets the date of taking, from which runs the accrual of interest, as February 13, 2017, for the Johnsons and the Walls and February 21, 2017, for Donna Robinson. Because of the parties conceded that for the purposes of summary judgment the above dates of taking, the Court makes no specific finding whether the actual physical invasion of the flood waters resulting in a taking occurred prior to the dates listed. 12 The City proffered a contrary opinion for the before-taking value of the Walls’ property. As addressed in the contemporaneously filed order striking that opinion, it was improperly offered as rebuttal opinion and therefore could not be considered. NRCP 16.1(a)(2)(E)(2). However, even if it would have been admissible, the City’s concession regarding the rental value of the Walls’ property and failure to argue that it affected the calculation of severance damages rendered it irrelevant to the Court’s decision.
  23. 23. 23 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 abate the flooding damage), or otherwise resume the use of the property. At most, the City argues that the County’s removal of the red tag on the Walls’ property ended their exclusion from the property. There has been no evidence introduced in this case that the County’s removal of a tag met applicable building guidelines or habitability standards; indeed evidence was heard during the liability phase that the County removed the tag even though no repairs to the property had been made. The Court firmly concludes any evidence of tag removal does not create a genuine issue of fact in light of the evidence of continued loss of use. Because the Walls presented evidence that the taking has prevented them from using their property for not less than 40 months from February 2017 to present date and the City has failed to refute that evidence, there is no genuine dispute of material fact and the Walls are awarded the rental value of their property for forty months, $34,600.00. 2. The City Failed to Establish a Genuine Dispute of Material Fact as to the Severance and Consequential Damages Due to the Walls The Walls established, through affidavit and expert opinion, damages for rental value, severance and consequential damages in their motion for summary judgment. In the first category, in addition to the rental value of the property, the Walls established through unchallenged expert testimony that the septic system existing at the time of the flooding was rendered unusable by the flooding of the property and change to the soil conditions after the flooding. The Walls averred that the septic system was inoperable due to the flooding at the time of evacuation in February 2017 and that no repairs or replacement had been made. The Plaintiffs’ experts further opined that Washoe County Code would not allow the construction of such a septic system based on the soil conditions found after the flooding on the property. The City offered no contrary evidence in opposition. In the absence of a genuine dispute of material fact, the Walls are entitled to compensation for the value of the property taken in the amount of $37,300.00, inclusive of the rental value of the property. In the second category of damages, the Walls presented expert opinion evidence regarding the cost to cure the flooding damage to their real and personal property and the effect of those damages on the market value of their property after the taking. Plaintiffs’ experts listed the
  24. 24. 24 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 necessary repairs, including installing an engineered septic system, implementing soil stabilization to support the residential foundation, removing and replacing decking, replacing damaged concrete flatwork, repairing damaged drywall and other damages to the garage, and performing remediation efforts for the crawlspace and vapor barrier. Relying on expert assessment and estimates for remediation and repairs, the Plaintiffs’ expert appraiser concluded that the total cost to cure would be $106,500.00 inclusive of the entrepreneurial incentive discussed supra note 10. The City made two arguments in regard to the portion of the cost to cure attributable to an engineered septic system. First, the City asserts that Plaintiffs failed to show that the City’s wastewater and stormwater systems permanently changed the character of the soils in the Swan Lake basin, and on the Walls property specifically, and have failed to rule out other potential causes for the alleged change in soil conditions, i.e., sources other than the City’s wastewater and stormwater systems. Second, the City asserts that such an award is duplicative and therefore cannot be awarded. As to the changed soil conditions, Plaintiffs presented expert reports analyzing the soils, opining, based upon sound engineering and testable methodology, that the flooding found to have been caused by the City fundamentally altered or saturated the soils in a manner that resulted in lasting and expensive impacts on the foundations and septic systems on the properties. The City presented no contrary evidence in opposition to the Walls’ Motion for Summary Judgment and no competent contrary evidence in response to this issue in any of the Plaintiffs’ motions. The City therefore failed to proffer evidence demonstrating a genuine issue of material fact as to the soil conditions or the need for an engineered septic system and cannot resist summary judgment on that basis. The City also failed to demonstrate that including a newly engineered septic system within the cost to cure severance damages would result in duplication of damages with the taken septic system. The City’s argument appears to be based on its misapprehension of the calculation of the cost to cure as a measure of market value. The City is not being directed to pay for the septic system twice; rather, only to pay for the property it impacted, the existing septic system, and the reduction in value to the property as a whole (to a fair market potential purchaser) due to that
  25. 25. 25 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 impact, since it is axiomatic the property will need an operational septic system to be returned to its highest and best use. The City’s remaining objections to the amount of severance damages due to the reduction in value based upon the cost to repair, all rely on the argument that the Walls failed to prove that the damages - and the resultant reduction in property value - were caused by the Swan Lake flooding. The City ignores and failed to rebut Mike Walls’s testimony that all of the damages claimed were a “direct result of the flooding” and the costs incurred were “necessary to address damages caused thereby.” The City, which neglected to depose any of the Plaintiffs during the damages phase, offered no contrary evidence and the Court rejects its argument that the Walls failed to provide evidence of causation. Because the City has offered no expert testimony that: (1) invalidates the valuation approach; (2) questions the accuracy of the cost to cure the damage to the Walls’ property; or (3) establishes a different value for the Walls’ property after the taking, it has not established a genuine issue of material fact to dispute the evidence presented by the Plaintiffs. The undisputed evidence shows the measure of severance damages for the Walls based upon the loss of value due to the need to repair is $106,500.00. The third category of damages—compensation for consequential costs incurred as a result of the taking13—includes for the Walls: rents, utilities and costs of moving ($38,877.29); laundry ($2,120.00); lost food ($3,100.00); lost vehicle parts and damages ($2,700.00); lost and damaged tools and equipment ($5,000.00); and supplies and repairs ($636.57). This category also includes compensation for the loss of use of equity. See Kimball Laundry Co., 338 U.S. at 10-13; Dorce v. City of N.Y., 460 F. Supp. 3d 327 (S.D.N.Y. 2020); W. Century 102 Ltd. V. City of Inglewood, 2002 WL 1065261 (Cal. Ct. App. May 29, 2002). Due to the taking, each of the Plaintiffs lost the benefits associated with ownership of property included in the fee simple bundle of rights. From the date 13 As addressed in oral argument, the Plaintiffs determined that just compensation awarded under the inverse condemnation claim includes any damages that could be awarded for conversion of property destroyed or damaged as a result of the flooding. These amounts are awarded as just compensation but could, alternatively, be awarded under the Plaintiffs’ successful claim for conversion.
  26. 26. 26 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 of taking until the payment of just compensation, Plaintiffs could not borrow against, encumber, sell or use the entire non-flooded fair market value of their properties. For example, the Plaintiffs’ expert opined that the Walls’ property was worth at least $147,000.00 in a non-flooded condition. The Walls, owing no debt on the property, had the right to encumber, borrow against, refinance or use that equity in any manner they sought. After the flooding, however, the property value was at most $28,000.00, significantly reducing the Walls’ equity in the property. To compensate for this loss, Plaintiffs’ valuation expert opined that a 3 percent annual return for three years of the difference in the pre-flooding valuation and the post-flooding valuation was reasonable compensation. For the Walls, Wright assigned a value of $22,800.00 as a lump sum for three years of loss of use of the equity in the property. The City objects to the award of damages for loss of use of equity but provides neither citation to any law nor evidence to create an issue of fact to support its objection. Any argument that prejudgment interest under NRS 37.175 compensates for this loss was not adequately presented as the City gave no explanation or argument of how interest compensates for the loss of a property right as opposed to the present loss of value of a future judgment. As a result of the taking, the Walls lost the use of the equity they had built in their property and are entitled to compensation for that loss under the United States and Nevada Constitutions. The City raised legal but no factual challenges to the Walls’ other compensatory damage values; indeed, during oral argument, the City conceded that it had no material evidence to offer in dispute of any of the claimed amounts. The City asserts that paying for the cost of rent and laundry are duplicative of the amount of compensation paid for the property actual taken, the rental value of the Walls’ home. Additionally, the City argues that it cannot be required to pay compensation for temporary lodging rents paid by a collateral source or third-party grant by the state or county government on behalf of the Walls. The evidence shows that the costs claimed were actually incurred on behalf of the Walls or by the Walls and are therefore necessary to place the Walls in a position as if the taking had not occurred. Nevada law is clear that the City is not entitled to an offset based upon collateral source payments or an offset of the just compensation it owes for amounts paid by other government entities. See Nev. Const. Art. I, Sec. 22(4)
  27. 27. 27 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 (specifically prohibiting “any governmental offsets” from the calculation of just compensation). Because the Walls lost the use of their property and had to pay rent to live elsewhere and charges to wash laundry in commercial facilities rather than in their own home at little or no cost, just compensation requires payment for the loss of use of property and the costs actually incurred and such compensation is not duplicative. The remainder of the City’s arguments against the award of out-of-pocket expenses rely on the assertion that the owner’s testimony of value of property is inadmissible. The Court finds this assertion is without merit. A property owner may offer opinion testimony regarding the value of his or her property. Dugan v. Gotsopoulos, 117 Nev. 285, 288, 22 P.3d 205, 207 (2001) (“A party to a lawsuit may testify as to the value of her personal or real property when that value is an issue in the case, and expert testimony is not required.”); City of Elko v. Zillich, 100 Nev. 366, 371, 683 P.2d 5, 8 (1984) (“[A]n owner, because of his ownership, is presumed to have special knowledge of the property and may testify as to its value.”). Because Mike Walls’s testimony regarding the value of personal property damaged by the flooding is admissible and the City has offered no contrary testimony as to value, the City failed to establish any genuine issue of material fact as to the propriety or amount of the award of consequential expenses to the Walls, including loss of use equity, in the amount of $75,233.86. Therefore, the Court finding no genuine issue of material fact as to the value of damages suffered by the Walls as a result of the City’s taking of their private property, summary judgment is granted in favor of the Walls in the total amount of $219,033.86. 3. The City Failed to Establish a Genuine Dispute of Material Fact as to the Severance and Consequential Damages Due to the Johnsons Unlike the Walls, the Johnsons sold their property in July 2020 after the liability phase and before the filing of their motion for summary judgment. It is well settled that “when there is a taking of property by eminent domain in compliance with the law, it is the owner of the property at the time of the taking who is entitled to compensation.” Palazzolo v. Rhode Island, 533 U.S. 606 (2001); Clark Cty. v. HQ Metro, LLC, 134 Nev. 467, 471, 422 P.3d 1243, 1246 (2018) (“The owner of the property at the time of the taking is the one entitled to compensation rather than a
  28. 28. 28 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 subsequent purchaser who owned the property when compensation was paid.” (citing Argier v. Nev. Power Co., 114 Nev. 137, 139, 952 P.2d 1390, 1391 (1998)). Therefore, the Johnsons’ sale of their property has no legal effect on their claims. The Johnsons established, through affidavit and expert opinion, damages for rental value, severance and consequential damages in their motion for summary judgment. In the first category, in addition to the rental value of the property addressed above, the Johnsons presented evidence that the septic system existing at the time of the flooding was rendered unusable by the change to the soil conditions in Lemmon Valley after the flooding. The Plaintiffs’ experts opined that Washoe County Code would not allow the construction of such a septic system based on the soil conditions. In opposition, the City offered the testimony of Wesley Pittman, a manager of an entity involved in the flipping of the Johnsons’ property. Plaintiffs objected to the use of Pittman’s affidavit as he was neither disclosed as an expert witness nor qualified as an expert and it included significant third-party statement hearsay. There was no showing by the City that Pittman’s testimony could have been presented in a form that would have been admissible at trial, and therefore it could not be considered in resisting summary judgment here. See NRS 48.025; NRS 52.015; NRS 50.265; NRCP 16.1; NRCP 56(c). As such, the City failed to offer evidence establishing a genuine issue of material fact as to the taking of the Johnson’s septic system as it existed at the time of the flooding. In the absence of a genuine dispute of material fact, the Johnsons are entitled to compensation for the value of the property taken in the amount of $20,750.00, which is the rental value of the property and the depreciated value of the unusable septic system. In the second category of damages, the Johnsons presented expert opinion evidence regarding the cost to cure the flooding damage to their real and personal property and the effect of those damages on the market value of their property after the taking. Since there was an arms- length sale of the property in an unrepaired condition, Plaintiff’s expert opined that the difference between the pre-flooding fair market value and the post-flooding unrepaired sales price was a reasonable approximation of the severance damages. The sale of their property offers an alternative and simpler method of establishing severance damages of reduced value rather than
  29. 29. 29 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 due to the cost to cure: the difference between the before-taking value of the property and the June 2020 sale price is $98,118.00. The use of this measure means there is no need to address the City’s arguments regarding the cost to cure or the other stricken expert report related to repairs. Because the City has offered no evidence or argument establishing a genuine issue of fact or a different value for the Johnsons’ property after the taking, it has not established a genuine issue of material fact for trial. The total measure of severance damage for the Johnsons based upon the loss of value due is therefore $98,118.00. The third category of damages, compensation for out-of-pocket costs incurred as a result of the taking, includes for the Johnsons: rents, utilities and costs of moving ($19,561.27); increased travel ($1,440.00); laundry ($2,160.00); and supplies and repairs ($550.00). As addressed above, the Johnsons lost the benefits associated with ownership of property included in the fee simple bundle of rights. From the date of taking until the payment of just compensation, Plaintiffs could not borrow against, encumber, sell or use the entire non-flooded fair market value of their properties. The City’s objections to this award for the Johnsons are identical to those raised for the Walls and are rejected for the same reasons. As a result of the taking, Wright opined that the Johnsons lost the use of the equity they had built in their property and are entitled to compensation for that loss under the United States and Nevada Constitutions in the amount of $23,383.00. The City raised legal but no factual challenges to the Johnsons’ claims; indeed, during oral argument, the City conceded that it had no evidence to offer in dispute of any of the claimed amounts. The City asserts that paying for the cost of rent, utilities and laundry are duplicative of the amount of just compensation paid for the property actual taken, the rental value of the Johnsons’ home. Additionally, the City argues that it cannot be required to pay compensation for rents paid by third-party grant on behalf of the Johnsons. The City’s arguments on these issues are the same for the Johnsons as they are for the Walls and are rejected for the same reasons. The City failed to establish any genuine issue of material fact as to the propriety or amount of the award of consequential expenses to the Johnsons, a total of $47,094.27.
  30. 30. 30 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Therefore, the Court finding no genuine issue of material fact as to the value of damages suffered by the Johnsons as a result of the City’s taking of their private property, grants summary judgment in favor of the Johnsons in the total amount of $165,962.27. 4. The City Failed to Establish a Genuine Dispute of Material Fact as to the Severance and Consequential Damages Due to Donna Robinson Donna Robinson established, through affidavit and expert opinion, damages for rental value, severance and consequential damages in their motion for summary judgment. In the first category, in addition to the rental value of the property, Robinson established through unchallenged expert testimony that the septic system existing at the time of the flooding was rendered unusable by the change to the soil conditions in Lemmon Valley after the flooding. The Plaintiffs’ experts opined that Washoe County Code would not allow the construction of such a septic system based on the soil conditions. Robinson also offered evidence that the flooding permanently destroyed a large tree and a portion of her lawn; the City offered no evidence to contradict Robinson’s claim. In the absence of a genuine dispute of material fact, Robinson is entitled to compensation for the value of the property taken in the amount of $27,900.00, which is the rental value of the property, the depreciated value of the unusable septic system and destroyed landscaping, as established by the testimony of the Plaintiff’s experts and Robinson herself. In the second category of damages, Robinson presented expert opinion evidence regarding the cost to cure the flooding damage to her real and personal property and the effect of those damages on the market value of her property after the taking. The majority of the City’s objections to Robinson’s presentation of damages in this category are the same as those above and are rejected for the same reasons. The primary unique objection to Robinson’s claim is an overlap of the just compensation claimed in cost to cure and out of pocket expenditures. This overlap exists because unlike the Walls and Johnsons, Robinson was able to obtain funding to perform some repairs to her property before she moved back in December 2017. Unfortunately, she performed repairs before the expert examinations of the soils revealed the full effect of the flooding on those soils. Robinson presented
  31. 31. 31 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 expert opinion that the repairs for which she paid in 2017 were insufficient to overcome the long- term damages caused by the flooding and would not result in a return to pre-taking fair market value. For example, she replaced the septic system she had at the time of the flooding with a new septic system; however, because the long term percolation and soil saturation issues were not known in 2017, she did not install an engineered septic system that Plaintiffs’ experts opine would be required by County Code in any new construction in Lemmon Valley. Therefore, the cost of installing an engineered system remains appropriate to include in calculating the after-taking value of Robinson’s property. Just compensation for the value of the ruined septic system and the out- of-pocket cost to install the new, non-engineered system are not duplicative of each other or the reduction in the after-taking value of Robinson’s property. The same reasoning applies to the SmartJack system and helical piers the Plaintiffs’ experts established would be required to resist continued soil movement as the saturated soils dry. Similarly, the drywall, paint, vapor barrier and other repairs will require repetition or correction once the solutions recommended by Plaintiffs’ experts are performed and they are appropriate to consider in the cost to cure even if such work has previously been performed. As the City has offered no expert testimony that: (1) invalidates the cost approach; (2) questions the accuracy of the cost to cure the damage to Robinson’s property; or (3) establishes a different value for Robinson’s property after the taking, it has not established any genuine issue of material fact in response to the substantial evidence presented by Robinson. The total measure of severance damage for Robinson based upon the loss of value due to cost to cure is $194,513.00 as established by the testimony of the Plaintiffs’ experts. The third category of damages, compensation for out-of-pocket costs incurred as a result of the taking, includes for Robinson: rents, utilities and costs of moving ($17,598.43); increased travel ($151.90); food while displaced ($396.89); animal boarding ($12,326.91); storage ($902.00); replacement of personal property and furnishings ($847.39); water testing ($12.00); and supplies and repairs ($69,475.50). As previously discussed, Robinson also lost the use of the equity in her property and therefore the Court finds the expert’s opinion of $46,241.00 for loss of use of equity reasonable and appropriate.
  32. 32. 32 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 The City raised legal and inconsequential factual challenges to Robinson’s claims, but it failed to support those challenges with evidence that could be presented to the Court in a form that would be admissible and it conceded during oral argument that it had no evidence to offer in dispute of any of the claimed amounts. As with the Walls and the Johnsons, the City asserts that paying for the cost of rent and utilities are duplicative of the amount of just compensation paid for the property actual taken and that it cannot be required to pay compensation for rents paid by third-party grant on behalf Robinson. The City’s arguments on these issues are the same for Robinson as they are for the Walls and are rejected for the same reasons. The City failed to establish a genuine issue of material fact as to the propriety or amount of the award of out-of- pocket expenses, inclusive of lost use of equity to Robinson, a total of $147,952.02. Therefore, summary judgment is granted in favor of Donna Robinson in the total amount of $370,365.02.14 E. The Plaintiffs Are Entitled to Pre- and Post-Judgment Interest Plaintiffs are entitled to both prejudgment and post-judgment interest. City of N. Las Vegas v. 5th & Centennial, Ltd. Liab. Co., 130 Nev. 619, 331 P.3d 896 (2014). Pre-judgment interest accrues at the legal rate in place at the time judgment is entered. Albios v. Horizon Communities, Inc., 122 Nev. 409, 431, 132 P.3d 1022, 1036 (2006). The Plaintiffs are awarded prejudgment interest as follows: the Walls are entitled to 5.25 percent interest compounded annually on the award of $219,033.86 from February 13, 2017, to the date of this Order; the Johnsons are entitled to 5.25 percent interest compounded annually on the award of $165,962.27 from February 13, 2017, to the date of this Order; and Donna Robinson is entitled to 5.25 percent interest compounded annually on the award of $370,365.02 from February 21, 2017, to the date of this Order. Post- judgment interest shall accrue on each award at the legal rate from the date of this Order. 14 The City argues that this sum is greater than the pre-taking fair market value and therefore must be reduced pursuant to federal law to the pre-taking fair market value. Although at first glance this argument has superficial appeal, it fails for two reasons. First, the severance damages alone are not greater than the pre-taking fair market value and so the award does not violate federal law. Second, the City fails to cite any Nevada law applying such a restriction when including consequential damages as a measure of just compensation. As such the Court does not agree that the sum should be reduced to the pre-taking fair market value of $350,000.00.
  33. 33. 33 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 VI. PLAINTIFFS’ MOTION IN LIMINE NO. 1 RE: DONAN REPORT Before the Court is the Plaintiffs’ Motion in Limine No. 1 Re: Donan Report filed on November 13, 2020. On November 30, 2020, the City filed three separate consolidated responses to the Plaintiff’s Motions in Limine Nos. 1 through 12, including to the Motion at issue in this Order. During discovery for the liability phase, the City disclosed a June 1, 2017 report drafted by Mr. John Mutiso, P.E. for Donan Engineering Company (hereinafter “Donan Report”) 15 The Donan Report contains the opinions of Mr. Mutiso related to the cause of damages to Robinson’s home at 11625 Tupelo Street. The Donan Report was commissioned by USAA, Ms. Robinson’s homeowner’s insurance company. The City of Reno listed the Donan Report in its pretrial disclosures. The Plaintiffs object and argue that the Donan Report is inadmissible as collateral source, an undisclosed expert, and hearsay. By its terms, the Donan Report was clearly prepared for the purpose of evaluation of Ms. Robinson’s insurance claim related to the flooding of her home and for submission to her insurance carrier. Admission of evidence of any insurance, any possible claims made, and any results of those claims made is contrary to NRS 48.135, excludable as irrelevant and likely to cause confusion or mislead and violates the collateral source rule as announced in Proctor v. Castelletti, 112 Nev. 88, 90, 911 P.2d 853, 854 (1996). Further, the Donan Report was signed and stamped by Mr. Mutiso, a licensed professional engineer in the State of Nevada. The Donan Report contains scientific, technical or other specialized information made by a person with special knowledge, skill, experience, training or education. For the statements and opinions of Mr. Mutiso to be theoretically admissible, the City would have had to have named Mr. Mutiso as an expert witness and disclose him as an expert witness in accordance with the provisions of NRS 50.275 and NRCP 16.1(a)(2). Not only did the City fail to disclose Mr. Mutiso as an expert, he is not listed as a witness in its pre-trial disclosures. Because the City failed to properly disclose Mutiso as an expert, his opinions and testimony are not admissible, including his statements in the Donan Report. 15 The City did not offer the Donan Report as evidence in opposition to the motions for summary judgment. To ensure clarity in any future proceedings, the Court nonetheless resolves the dispute over its admissibility.
  34. 34. 34 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Finally, the Donan Report contains statements made out of Court that are intended to prove the truth of the matters asserted related to the cause of damages to Ms. Robinson’s property. Pursuant to the provisions of NRS 51.065, the contents of the Donan Report are hearsay without an exception, and as such, the Donan Report is inadmissible. Good cause appearing, the Court finds that the Donan Report is inadmissible and not considered by the Court. VII. PLAINTIFFS’ MOTION IN LIMINE NO. 2 RE: SCHENK REPORT Before the Court is the Plaintiffs’ Motion in Limine No. 2 Re: Schenk Report filed November 13, 2020, seeking to exclude the Schenk Report and Mr. Schenk’s testimony from the trial in this matter. On November 30, 2020, the City filed three separate consolidated responses to the Plaintiff’s Motions in Limine Nos. 1 through 12, including to the Motion at issue in this Order. On September 1, 2020, the City disclosed an expert rebuttal report drafted by Mr. Johnathan Schenk (hereinafter “Schenk Report’). The Schenk Report, a letter from Schenk, describes how Mr. Schenk conducted repairs to the septic tank at 415 Pompe Way, the property that was owned by the Johnsons at the time of the taking and which they sold in June of 2020. The City’s Rebuttal Expert Disclosure where Mr. Schenk was disclosed does not state whose testimony Mr. Schenk’s testimony is intended to rebut. It merely states that “Mr. Schenk will provide direct and rebuttal opinions regarding any and all matters addressed in his written report.” Further, Mr. Schenk’s report doesn’t claim to rebut any testimony, and does not mention the testimony of any other person or party. It is not reasonably disputed that the City has known for months, if not years, that the Plaintiffs’ damages case in chief would include claims for damages related to septic-system damage cause by the flooding, but the City did not make an initial expert disclosure addressing those issues as required by NRCP 16.1(a)(2)(E)(ii). Further, Mr. Schenk’s report does not “rebut” anything – it is just direct testimony about repairs Mr. Schenk conducted on the Johnson’s former septic system. Rebuttal experts may only “contradict or rebut evidence on the same subject matter identified by another party.” NRCP 16.1(a)(2)(E)(i)(b).
  35. 35. 35 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Whether an expert will be permitted to testify by the Court is based on the inquiry established in Hallmark v. Eldridge, 124 Nev. 492, 189 P.3d 646 (2008), as follows: To testify as an expert witness under NRS 50.275, the witness must satisfy the following three requirements: (1) he or she must be qualified in an area of “scientific, technical or other specialized knowledge;” (the qualification requirement); (2) his or her specialized knowledge must, “assist the trier of fact to understand the evidence or to determine a fact in issue;” (the assistance requirement); and (3) his or her testimony must be limited “to matters within the scope of [his or her specialized] knowledge;” (the limited scope requirement). As explained below, Mr. Schenk fails to meet the Hallmark standards, and as such, he should not be permitted to testify as an expert. Mr. Schenk’s qualifications are described in his report, i.e., that he has been in the “excavation business” for 20.5 years, and that “we [sic] carry licenses for both plumbing and excavation.” However, these licenses are not specifically described, i.e., what the licenses are or who issued them. Mr. Schenk also states that he conducts work on septic systems, but does not state what “scientific, technical or other specialized knowledge” he has of such systems. Second, neither Mr. Schenk’s report nor the City’s disclosure states how Mr. Schenk’s testimony is to “assist the trier of fact to understand the evidence or to determine a fact in issue.” Presumably, the Schenk report is intended to rebut issues related to the need for an engineered septic system as relayed by the Plaintiff’s expert Chris Spandau, P.E. However, Mr. Spandau, a licensed engineer, states in his report that he based his opinions on repeatable engineering science after conducting soil borings, soil sample testing and percolation testing for onsite septic systems in the Pompe Way and Tupelo Street areas, where the Plaintiffs reside. Mr. Spandau concluded, “The two percolation tests performed in June 2020 ranged from 240 to 480 minutes per inch. These are extremely slow rates and would require a detailed engineered design to allow for onsite septic disposal.” Mr. Schenk performed no such tests to rebut the opinions of Mr. Spandau, nor is there any evidence that he qualified to do so, so Mr. Schenk’s testimony does not assist the trier of fact in determining whether Mr. Spandau’s testimony is accurate. Third and lastly, as is the case with the assistance requirement, Mr. Schenk’s rebuttal testimony, is not within the scope of his knowledge. He provides no analysis of the Washoe Health District regulations for septic soils. Again, the Plaintiffs’ claim related to damages to septic systems
  36. 36. 36 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 is based upon soil studies and the testimony of Mr. Spandau. As such, any rebuttal from Mr. Schenk to Mr. Spandau’s testimony is beyond the scope of Mr. Schenk’s knowledge. BASED ON THE FOREGOING, and pursuant to NRCP 16.1(e)(3), 37(b) and Hallmark v. Eldridge, 124 Nev. 492 (2008), the Court finds that striking Johnathan Schenk from providing any expert testimony or submitting reports for the record in this matter is warranted under the circumstances. VIII. PLAINTIFFS’ MOTION FOR DETERMINATION OF SUFFICIENCY OF THE ADMISSIONS Before the Court is the Plaintiffs’ October 15, 2020 Motion for Determination of Sufficiency of Admissions. The Plaintiffs served NRCP 36 requests for admission on the City on July 29, 2020. The City responded on August 28, 2020. A meet and confer letter was sent from Plaintiffs’ counsel on September 8, 2020. A telephonic meet and confer between counsel took place on September 16, 2020. Also, on September 16, 2020, the City of Reno served its first supplemental responses. Then, on September 21, 2020, the City served its Second Supplemental Responses. Counsel for the parties then scheduled a meet and confer with the Washoe County Discovery Commissioner on September 24, 2020, to discuss this and all the City’s responses to written discovery propounded on July 29, 2020. The City then served its Third Supplemental Responses on September 29, 2020. In its Third Supplemental Response, the City provided unqualified denials to each request without any response to the substance of the matter requested. The evolution of the City’s responses from August 28, 2020, through the Third Supplemental Responses on September 29, 2020, demonstrates that the City did not fairly respond to the Plaintiffs’ straightforward requests. In the original responses, the City objected to nearly all the requests identically claiming that questions about flooding, duration of flooding and displacement of tenants would have no relevance to damages. No objections were provided within the City’s third and final responses. Nevada Rule of Civil Procedure 36(a)(4) clearly charges that if a matter is not admitted, a response must specifically deny it or state in detail why the answering party cannot truthfully admit or deny it and a denial must fairly respond to the substance of the matter.
  37. 37. 37 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Request for Admission No. 1 asked: “Admit that flood waters physically invaded upon the real property at 415 Pompe Way (Johnsons’ parcel) anytime between January 2017 and January 2018.” The City’s response was simply: “Deny.” Under NRCP 36(a)(4), the City was required to “fairly meet the substance” of the requests in its denials, and if the City chose to admit in part, good faith required the City to specify what parts of the request it admitted to or denied. Because the City did neither, its answers were insufficient under Rule 36. The admitted evidence from the trial conclusively showed flood waters physically located upon the real property at 415 Pompe Way during 2017. This same analysis applies to Requests for Admission Nos 2-8. The City had no reasonable factual basis to deny the truth of Requests for Admissions 1-8, and the City did not provide any. Request for Admission No. 9 simply asked for the City’s opinion as to whether the term “just compensation” includes all monies necessary to place the individual in a position as if the taking had never occurred. The language from Request No. 9 was taken essentially verbatim from the Nevada Constitution, Article I, Section 22(4): In all eminent domain actions, just compensation shall be defined as that sum of money, necessary to place the property owner back in the same position, monetarily, without any governmental offsets, as if the property had never been taken. Just compensation shall include, but is not limited to, compounded interest and all reasonable costs and expenses actually incurred. Yet, the City’s response to Requests for Admission No. 9 is simply “deny,” without any explanation. Because the Court has granted summary judgment in this matter in favor of the Plaintiff and neither the Plaintiff nor the City relied on the responses in the motions for summary judgment, granting the relief requested under Rule 36(a)(6) is inapposite. However, the Court finds that the City should be sanctioned pursuant to NRCP 37(c)(2), as the Plaintiffs met their burden to show the truth of the matters requested were of substantial importance but denied by the City, the City lacked reasonable ground to believe that it might prevail on its denials of the matters requested; and there was no other good reason for the failure of the City to admit the truth of the matters requested.
  38. 38. 38 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 BASED ON THE FOREGOING, the Court sanctions the City of Reno ONE-THOUSAND, FIVE-HUNDRED DOLLARS AND ZERO CENTS ($1,500.00) to reimburse Plaintiffs’ counsel for legal expenses of bringing this motion. This amount is due to be paid within twenty (20) days of the date this Order is filed. IT IS HEREBY ORDERED AND ADJUDGED the Plaintiffs established the absence of any genuine issue of material fact and their entitlement to judgment as a matter of law for damages to Walls of $219,033.86, plus 5.25 percent interest compounded annually from February 13, 2017, to the date of this Order and post-judgment interest at the legal rate; the Johnsons of $165,962.27, plus 5.25 percent interest compounded annually from February 13, 2017, to the date of this Order and post-judgment interest at the legal rate; and Donna Robinson of $370,365.02, plus 5.25 percent interest compounded annually from February 21, 2017, to the date of this Order and post-judgment interest at the legal rate.16 IT IS TO ORDERED. DATED this _____ day of February, 2021. ______________________________ BARRY L. BRESLOW DISTRICT COURT JUDGE 16 Based on the Court’s Summary Decision on Pending and Argued Motions, the following are motions are denied as moot: (a) City of Reno’s Motion for View by Jury filed October 7, 2019; (b) Plaintiffs’ Motions in Limine Nos. 3, 4, ,5, 6 & 7 Re: Witnesses, filed November 13, 2020; and (c) Plaintiffs’ Motions in Limine Nos. 8, 9, 10 & 11 Re: Relevant Evidence filed November 13, 2020. 11
  39. 39. 39 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 CERTIFICATE OF SERVICE Pursuant to NRCP 5(b), I certify that I am an employee of the _______________________ and that on the date shown below, I caused service to be completed of a true and correct copy of the foregoing Order on Pending Motions and Granting Summary Judgment to Plaintiffs by: ______ personally delivering; ______ delivery via Reno/Carson Messenger Service; ______ sending via Federal Express (or other overnight delivery service); ______ depositing for mailing in the U.S. mail, with sufficient postage affixed thereto; or, X delivery via electronic means (fax, eflex, NEF, etc.) to: Jonathan Shipman, Esq. Chandeni Sendall, Esq. William McKean, Esq. Reno City Attorney's Office P.O. Box 1900 Reno, NV 89505 LUKE A. BUSBY, ESQ Nevada Bar No. 10319 LUKE ANDREW BUSBY, LTD. 316 California Ave 82 Reno, Nevada 89509 775-453-0112 luke@lukeandrewbusbyltd.com ROGER S. DOYLE, ESQ. Nevada Bar No. 10876 KERRY S. DOYLE, ESQ Nevada Bar No. 10866 DOYLE LAW OFFICE, PLLC 4600 Kietzke Lane, Suite I-207 Reno, Nevada 89502 (775) 525-0889 admin@rdoylelaw.com DATED this _____ date of February, 2021. __________________________ JUDICIAL ASSISTANT Second Judicial District Court 11

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