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Wilson v. Nevada Affordable Housing Assistance Corp.

United States District Court, D. Nevada

March 30, 2017

NEDRA WILSON, Plaintiff,
v.
NEVADA AFFORDABLE HOUSING ASSISTANCE CORPORATION, Defendant.

          ORDER GRANTING IN PART AND DENYING IN PART THE PLAINTIFF'S MOTION FOR SUMMARY JUDGMENT ON THE DEFENDANT'S COUNTERCLAIMS (ECF No. 76)

          ANDREW P. GORDON UNITED STATES DISTRICT JUDGE

         Plaintiff Nedra Wilson worked for defendant Nevada Affordable Housing Assistance Corporation (NAHAC) as its controller. After she was fired, she filed this lawsuit against NAHAC, alleging race discrimination and retaliation. In response, NAHAC filed counterclaims against Wilson for breach of contract, breach of the implied covenant of good faith and fair dealing, and breach of fiduciary duty.

         Wilson moves for summary judgment on the counterclaims. As to the two contract-based claims, Wilson argues there is no contract between the parties that would allow for NAHAC to recover damages for a breach. Wilson also argues that even if a contract existed, NAHAC has not suffered any damages. As to the breach of fiduciary duty claim, Wilson argues that she did not breach a duty of loyalty to NAHAC because there is no evidence she engaged in self-dealing.

         NAHAC responds that the controller job description, the employee handbook, and a TreasuryEdge Security Admin ID Authorization form were contractual obligations that Wilson breached. NAHAC contends she breached these agreements by improperly releasing a wire transfer, sharing her bank token[1] with other employees, and various other alleged performance failures. According to NAHAC, Wilson was a “faithless servant” who thus is not entitled to compensation for work done in violation of her duty of loyalty. NAHAC also argues it suffered damages in the form of salaries of employees who had to fix the mistakes Wilson allegedly made. Finally, as to the breach of fiduciary duty claim, NAHAC argues Wilson owed a fiduciary duty as an employee to not disclose or misuse her employer's confidential information. NAHAC contends Wilson breached that duty when she did not safeguard her bank token and instead let other employees use it.

         The parties are familiar with the facts of this case and I will not repeat them in detail here. I grant Wilson's motion on the claims for breach of the implied covenant of good faith and fair dealing and breach of fiduciary duty. I deny it as to the breach of contract claim.

         I. ANALYSIS

         Summary judgment is appropriate if the pleadings, discovery responses, and affidavits demonstrate “there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Fed.R.Civ.P. 56(a), (c). A fact is material if it “might affect the outcome of the suit under the governing law.” Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). An issue is genuine if “the evidence is such that a reasonable jury could return a verdict for the nonmoving party.” Id.

         The party seeking summary judgment bears the initial burden of informing the court of the basis for its motion and identifying those portions of the record that demonstrate the absence of a genuine issue of material fact. Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). The burden then shifts to the non-moving party to set forth specific facts demonstrating there is a genuine issue of material fact for trial. Fairbank v. Wunderman Cato Johnson, 212 F.3d 528, 531 (9th Cir. 2000). I view the evidence and reasonable inferences in the light most favorable to the non-moving party. James River Ins. Co. v. Hebert Schenk, P.C., 523 F.3d 915, 920 (9th Cir. 2008).

         A. Breach of Contract

         Wilson argues that there is no contract between the parties. She also argues NAHAC suffered no damages from a breach. NAHAC responds that the parties were in an at-will employment relationship that Nevada treats as contractual. NAHAC also argues that various documents, such as the job description, the employee handbook, and the TreasuryEdge Security Admin ID Authorization form (which sets forth who at NAHAC would have bank token rights to deposit or release funds with Bank of New York Mellon), constitute a contract. NAHAC asserts damages in the form of the salary of employees who had to fix Wilson's alleged errors.

         A breach of contract claim under Nevada law requires “(1) the existence of a valid contract, (2) a breach by the defendant, and (3) damage as a result of the breach.” Med. Providers Fin. Corp. II v. New Life Centers, L.L.C., 818 F.Supp.2d 1271, 1274 (D. Nev. 2011) (quotation omitted). Generally, a contract is valid and enforceable if there has been “an offer and acceptance, meeting of the minds, and consideration.” May v. Anderson, 119 P.3d 1254, 1257 (Nev. 2005). Under Nevada law, an at-will employment agreement is a contract. D'Angelo v. Gardner, 819 P.2d 206, 211-12 (Nev. 1991) (“Employment contracts are ordinarily and presumably contracts which are terminable at will . . . .”) (emphasis omitted).

         Here, Wilson was offered the job of controller on January 17, 2014. ECF No. 76-5. She accepted the offer of at-will employment by signing the offer and job description and by working for NAHAC as controller. ECF Nos. 76-5, 76-8.[2] Under Nevada law, the at-will employment relationship is contractual. See Baldonado v. Wynn Las Vegas, LLC, 194 P.3d 96, 105-06 (Nev. 2008) (en banc); D'Angelo v. Gardner, 819 P.2d at 211-12. NAHAC therefore has presented evidence of a valid contract between the parties.

         Wilson argues that because NAHAC could unilaterally change the terms of her job duties, no bilateral contract was formed. But the Supreme Court of Nevada has rejected this proposition. Baldonado, 194 P.3d at 105-06 (“[W]e also have established that employers may unilaterally modify the terms of an at-will employment arrangement in prospective fashion; the employee's continued employment constitutes sufficient consideration for the modification.”).

         Finally, Wilson argues there is no evidence of damages. However, NAHAC has presented evidence that it incurred expenses in correcting various errors Wilson made during her tenure. See ECF Nos. 79 at 70-72; 80; see also Colorado Environments, Inc. v. Valley Grading Corp., 779 P.2d 80, 84 (Nev. 1989) (contract damages “are intended to place the nonbreaching party in as good a position as if the contract had been performed”); Restatement (Second) of Contracts § 347 (1979) (contract damages include “(a) the loss in value to [the nonbreaching party] of the other party's performance caused by its failure or deficiency, plus (b) any other loss, including incidental or consequential loss, ...


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