The Law

Two companies that rent space in a mall owned by PHWLV sued the landlord for negligence in maintaining the fire‑suppression system after a pipe burst on July 8th 2017. Pre‑trial, the Eighth Judicial District Court in Clark County granted partial summary judgment in favor of the retailers. Due to the partial summary judgment, the jury trial focused solely on the extent of damages suffered by the retailers. The jury returned a verdict in favor of Retailers House of CB and Chinese Laundry Lifestyle, rewarding the two retailers $3,133,755.56 and $411,581.41 respectively. In response, PHWLV moved for a new trial and was denied by the district court. PHWLV then appealed each of the district court’s orders.

In regards to the case Retailers House of CB USA, LLC and Chinese Laundry Lifestyle, LLC vs. PHWLV, LLC, the Supreme Court of Nevada looked at four specific elements that must be satisfied in regards to a claim of negligence: “(1) an existing duty of care, (2) breach, (3) legal causation, and (4) damages.”

The Supreme Court looked first at the “existing duty of care” and found that PHWLV did, in fact, owe a duty of reasonable care as it owned the fire‑suppression system that ultimately malfunctioned. However, as the Supreme Court of Nevada limited the scope of “PHWLV’s duty to the use of reasonable care” it was determined that the district court erred in describing the terms as absolute.

It was decided that the courts cannot determine whether or not PHWLV exercised reasonable care - it must be determined by a jury. In order to determine a verdict, the jury must take two things into consideration: “first, whether PHWLV breaches its duty of reasonable care by not maintaining the system; and second, whether PHWLV breached its duty when responding to the incident.” Due to this finding, the Supreme Court also found that the district court erred in denying a new trial. As the district court made an error in defining PHWLV’s duty of care, there should be a new trial.

PHWLV requested the case be transferred to a different judicial department. The reasoning given was that inadmissible evidence was presented to the judge and said judge made several adverse rulings against the landlord. However, PHWLV could not identify any evidence that was presented to the judge that should have been excluded. The landlord could not give any explanation of partiality in regards to the judge’s rulings. Therefore, the request of transfer was denied by the Supreme Court of Nevada.

In conclusion - there will be a new trial for Retailers of House CB, LLC and Chinese Laundry Lifestyle, LLC vs. PHWLV, LLC to determine whether PHWLV satisfied its duty of reasonable care in regards to its fire‑suppression system.

(PHWLV, LLC VS. HOUSE OF CB USA, LLC (Supreme Court of Nevada, Citation: 140 Nev. Adv. Op. No. 53))

Decision: August 2024
Published: August 2024

Feature Articles

If you have an opinion on the retailing or retail real estate industries, take this opportunity to share your thoughts. Articles should run between 400 and 800 words. Topics can, be general in nature, consumer observation or specific to retail concepts or practices.

Articles will be posted for at least one week and will then be placed in the Editorial Archives. All articles submitted will be read and considered but we cannot guarantee publication. Each published article will carry the submitters byline (if desired) and is a free service to our community.

Article ideas and suggestions are also always welcomed. Contact PVS@PlainVanillaShell.com