[Rev. 11/21/2013 9:02:39 AM--2013]

CHAPTER 42 - DAMAGES

NRS 42.001             Definitions; exceptions.

NRS 42.005             Exemplary and punitive damages: In general; limitations on amount of award; determination in subsequent proceeding.

NRS 42.007             Exemplary and punitive damages: Limitations on liability by employer for wrongful act of employee; exception.

NRS 42.010             Exemplary and punitive damages: Injury caused by operation of vehicle after consumption of alcohol or controlled substance.

NRS 42.021             Actions based on professional negligence of providers of health care: Introduction of certain evidence relating to collateral benefits; restrictions on source of collateral benefits; payment of future damages by periodic payments.

NRS 42.030             Court approval of agreement to transfer structured settlement required.

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      NRS 42.001  Definitions; exceptions.  As used in this chapter, unless the context otherwise requires and except as otherwise provided in subsection 5 of NRS 42.005:

      1.  “Conscious disregard” means the knowledge of the probable harmful consequences of a wrongful act and a willful and deliberate failure to act to avoid those consequences.

      2.  “Fraud” means an intentional misrepresentation, deception or concealment of a material fact known to the person with the intent to deprive another person of his or her rights or property or to otherwise injure another person.

      3.  “Malice, express or implied” means conduct which is intended to injure a person or despicable conduct which is engaged in with a conscious disregard of the rights or safety of others.

      4.  “Oppression” means despicable conduct that subjects a person to cruel and unjust hardship with conscious disregard of the rights of the person.

      (Added to NRS by 1995, 2668)

      NRS 42.005  Exemplary and punitive damages: In general; limitations on amount of award; determination in subsequent proceeding.

      1.  Except as otherwise provided in NRS 42.007, in an action for the breach of an obligation not arising from contract, where it is proven by clear and convincing evidence that the defendant has been guilty of oppression, fraud or malice, express or implied, the plaintiff, in addition to the compensatory damages, may recover damages for the sake of example and by way of punishing the defendant. Except as otherwise provided in this section or by specific statute, an award of exemplary or punitive damages made pursuant to this section may not exceed:

      (a) Three times the amount of compensatory damages awarded to the plaintiff if the amount of compensatory damages is $100,000 or more; or

      (b) Three hundred thousand dollars if the amount of compensatory damages awarded to the plaintiff is less than $100,000.

      2.  The limitations on the amount of an award of exemplary or punitive damages prescribed in subsection 1 do not apply to an action brought against:

      (a) A manufacturer, distributor or seller of a defective product;

      (b) An insurer who acts in bad faith regarding its obligations to provide insurance coverage;

      (c) A person for violating a state or federal law prohibiting discriminatory housing practices, if the law provides for a remedy of exemplary or punitive damages in excess of the limitations prescribed in subsection 1;

      (d) A person for damages or an injury caused by the emission, disposal or spilling of a toxic, radioactive or hazardous material or waste; or

      (e) A person for defamation.

      3.  If punitive damages are claimed pursuant to this section, the trier of fact shall make a finding of whether such damages will be assessed. If such damages are to be assessed, a subsequent proceeding must be conducted before the same trier of fact to determine the amount of such damages to be assessed. The trier of fact shall make a finding of the amount to be assessed according to the provisions of this section. The findings required by this section, if made by a jury, must be made by special verdict along with any other required findings. The jury must not be instructed, or otherwise advised, of the limitations on the amount of an award of punitive damages prescribed in subsection 1.

      4.  Evidence of the financial condition of the defendant is not admissible for the purpose of determining the amount of punitive damages to be assessed until the commencement of the subsequent proceeding to determine the amount of exemplary or punitive damages to be assessed.

      5.  For the purposes of an action brought against an insurer who acts in bad faith regarding its obligations to provide insurance coverage, the definitions set forth in NRS 42.001 are not applicable and the corresponding provisions of the common law apply.

      (Added to NRS by 1989, 486; A 1995, 2669)

      NRS 42.007  Exemplary and punitive damages: Limitations on liability by employer for wrongful act of employee; exception.

      1.  Except as otherwise provided in subsection 2, in an action for the breach of an obligation in which exemplary or punitive damages are sought pursuant to subsection 1 of NRS 42.005 from an employer for the wrongful act of his or her employee, the employer is not liable for the exemplary or punitive damages unless:

      (a) The employer had advance knowledge that the employee was unfit for the purposes of the employment and employed the employee with a conscious disregard of the rights or safety of others;

      (b) The employer expressly authorized or ratified the wrongful act of the employee for which the damages are awarded; or

      (c) The employer is personally guilty of oppression, fraud or malice, express or implied.

Ê If the employer is a corporation, the employer is not liable for exemplary or punitive damages unless the elements of paragraph (a), (b) or (c) are met by an officer, director or managing agent of the corporation who was expressly authorized to direct or ratify the employee’s conduct on behalf of the corporation.

      2.  The limitations on liability set forth in subsection 1 do not apply to an action brought against an insurer who acts in bad faith regarding its obligations to provide insurance coverage.

      (Added to NRS by 1995, 2668)

      NRS 42.010  Exemplary and punitive damages: Injury caused by operation of vehicle after consumption of alcohol or controlled substance.

      1.  In an action for the breach of an obligation, where the defendant caused an injury by the operation of a motor vehicle in violation of NRS 484C.110, 484C.130 or 484C.430 after willfully consuming or using alcohol or another substance, knowing that the defendant would thereafter operate the motor vehicle, the plaintiff, in addition to the compensatory damages, may recover damages for the sake of example and by way of punishing the defendant.

      2.  The provisions of NRS 42.005 do not apply to any cause of action brought pursuant to this section.

      (Added to NRS by 1965, 1143; A 1967, 738; 1981, 1928; 1989, 487; 2005, 161)

      NRS 42.021  Actions based on professional negligence of providers of health care: Introduction of certain evidence relating to collateral benefits; restrictions on source of collateral benefits; payment of future damages by periodic payments.

      1.  In an action for injury or death against a provider of health care based upon professional negligence, if the defendant so elects, the defendant may introduce evidence of any amount payable as a benefit to the plaintiff as a result of the injury or death pursuant to the United States Social Security Act, any state or federal income disability or worker’s compensation act, any health, sickness or income-disability insurance, accident insurance that provides health benefits or income-disability coverage, and any contract or agreement of any group, organization, partnership or corporation to provide, pay for or reimburse the cost of medical, hospital, dental or other health care services. If the defendant elects to introduce such evidence, the plaintiff may introduce evidence of any amount that the plaintiff has paid or contributed to secure the plaintiff’s right to any insurance benefits concerning which the defendant has introduced evidence.

      2.  A source of collateral benefits introduced pursuant to subsection 1 may not:

      (a) Recover any amount against the plaintiff; or

      (b) Be subrogated to the rights of the plaintiff against a defendant.

      3.  In an action for injury or death against a provider of health care based upon professional negligence, a district court shall, at the request of either party, enter a judgment ordering that money damages or its equivalent for future damages of the judgment creditor be paid in whole or in part by periodic payments rather than by a lump-sum payment if the award equals or exceeds $50,000 in future damages.

      4.  In entering a judgment ordering the payment of future damages by periodic payments pursuant to subsection 3, the court shall make a specific finding as to the dollar amount of periodic payments that will compensate the judgment creditor for such future damages. As a condition to authorizing periodic payments of future damages, the court shall require a judgment debtor who is not adequately insured to post security adequate to assure full payment of such damages awarded by the judgment. Upon termination of periodic payments of future damages, the court shall order the return of this security, or so much as remains, to the judgment debtor.

      5.  A judgment ordering the payment of future damages by periodic payments entered pursuant to subsection 3 must specify the recipient or recipients of the payments, the dollar amount of the payments, the interval between payments, and the number of payments or the period of time over which payments will be made. Such payments must only be subject to modification in the event of the death of the judgment creditor. Money damages awarded for loss of future earnings must not be reduced or payments terminated by reason of the death of the judgment creditor, but must be paid to persons to whom the judgment creditor owed a duty of support, as provided by law, immediately before the judgment creditor’s death. In such cases, the court that rendered the original judgment may, upon petition of any party in interest, modify the judgment to award and apportion the unpaid future damages in accordance with this subsection.

      6.  If the court finds that the judgment debtor has exhibited a continuing pattern of failing to make the periodic payments as specified pursuant to subsection 5, the court shall find the judgment debtor in contempt of court and, in addition to the required periodic payments, shall order the judgment debtor to pay the judgment creditor all damages caused by the failure to make such periodic payments, including, but not limited to, court costs and attorney’s fees.

      7.  Following the occurrence or expiration of all obligations specified in the periodic payment judgment, any obligation of the judgment debtor to make further payments ceases and any security given pursuant to subsection 4 reverts to the judgment debtor.

      8.  As used in this section:

      (a) “Future damages” includes damages for future medical treatment, care or custody, loss of future earnings, loss of bodily function, or future pain and suffering of the judgment creditor.

      (b) “Periodic payments” means the payment of money or delivery of other property to the judgment creditor at regular intervals.

      (c) “Professional negligence” means a negligent act or omission to act by a provider of health care in the rendering of professional services, which act or omission is the proximate cause of a personal injury or wrongful death. The term does not include services that are outside the scope of services for which the provider of health care is licensed or services for which any restriction has been imposed by the applicable regulatory board or health care facility.

      (d) “Provider of health care” means a physician licensed under chapter 630 or 633 of NRS, dentist, licensed nurse, dispensing optician, optometrist, registered physical therapist, podiatric physician, licensed psychologist, chiropractor, doctor of Oriental medicine, medical laboratory director or technician, licensed dietitian or a licensed hospital and its employees.

      (Added to NRS by 2004 initiative petition, Ballot Question No. 3; A 2011, 1511)

      NRS 42.030  Court approval of agreement to transfer structured settlement required.

      1.  An agreement to transfer the right to receive payments pursuant to a structured settlement to a transferee is valid and enforceable only if the transfer is approved by a district court. The transferee must petition the district court for such approval and the court shall approve the transfer if it determines that:

      (a) The transfer is in the best interest of the payee, considering the totality of the circumstances, including, without limitation, the welfare and support of the dependents of the payee;

      (b) The payee has been advised in writing by the transferee to seek independent professional advice regarding the transfer and has received such independent professional advice or has knowingly waived such advice in writing; and

      (c) The transfer does not violate any applicable law or the order of any court.

      2.  An action pursuant to subsection 1 must be commenced in the district court:

      (a) Located where the original claim which gave rise to the structured settlement was filed; or

      (b) Within the county in which the payee resides.

      3.  Not later than 7 days before a hearing on a petition pursuant to subsection 1, the transferee must file with the district court and serve on all interested parties and any attorney who represented the payee in the action which resulted in the settled claim a notice of the proposed agreement and the petition for authorization of the proposed agreement. The notice must include, without limitation:

      (a) A copy of the petition of the transferee;

      (b) A copy of the proposed agreement;

      (c) A copy of the disclosure required pursuant to subsection 4;

      (d) A list which includes the name and age of each dependent of the payee;

      (e) A statement that any interested party may support, oppose or otherwise respond to the petition of the transferee by appearing in person or by counsel during the hearing on the petition or by submitting written comments to the court; and

      (f) Notice of the time and place of the hearing, the manner in which a written response to the application must be filed and the date by which a written response to the petition must be filed for consideration by the court.

      4.  A transferee who commences an action pursuant to subsection 1 must provide to the court with the proposed agreement a disclosure setting forth:

      (a) The amounts and due dates of the payments under the structured settlement proposed to be transferred;

      (b) The aggregate amount of the proposed payments to be transferred;

      (c) The amount to be paid to the payee for the transfer before deducting any expenses;

      (d) An itemized list of all expenses that the payee will be required to pay other than attorney’s fees and which will be deducted from the amount paid to the payee for the transfer, including, without limitation, any commission owed to a broker, service charges, application or processing fees, costs of closing on the agreement, filing or administrative charges and fees paid to a notary public;

      (e) The amount to be paid to the payee for the transfer after deducting the expenses;

      (f) The amount of any liquidated damages which the payee is required to pay if the payee breaches the transfer agreement;

      (g) The discounted present value of the payments under the structured settlement that are proposed to be transferred and the discount rate used to determine that value; and

      (h) If adverse tax consequences exist, a statement which informs the payee that such a transfer may subject the payee to adverse tax consequences with regard to the payment of federal income tax.

      5.  Compliance with the requirements set forth in this section may not be waived.

      6.  As used in this section:

      (a) “Annuity issuer” means an insurer who has issued a contract to fund periodic payments under a structured settlement;

      (b) “Dependents” include, without limitation, the spouse of a payee, any minor child of a payee and any other person for whom the payee is legally obligated to provide support, including, without limitation, alimony;

      (c) “Independent professional advice” means advice of an attorney, certified public accountant, actuary or other licensed professional adviser;

      (d) “Interested parties” means the payee, any beneficiary irrevocably designated under the annuity contract to receive payments following the death of the payee, the annuity issuer, any person who is obligated to make payments pursuant to the structured settlement and any other party who has continuing rights or obligations under the structured settlement;

      (e) “Payee” means a person who is receiving tax-free payments under a structured settlement and proposes to make a transfer of the right to receive payments under that structured settlement;

      (f) “Periodic payments” includes, without limitation, both recurring payments and scheduled future lump-sum payments;

      (g) “Settled claim” means the original tort claim or workers’ compensation claim resolved by a structured settlement;

      (h) “Structured settlement” means an arrangement for periodic payment of damages for personal injuries or sickness established by settlement or judgment in resolution of a tort claim or for periodic payments in settlement of a workers’ compensation claim;

      (i) “Transfer” means any sale, assignment, pledge, hypothecation or other alienation or encumbrance by a payee for consideration of the right to receive payments pursuant to a structured settlement; and

      (j) “Transferee” means a party acquiring or proposing to acquire the right to payments pursuant to a structured settlement through a transfer.

      (Added to NRS by 2003, 1665)