Man can sue rental car company over wreck

By Jessica M. Karmasek | Aug 17, 2011


CARSON CITY, Nev. (Legal Newsline) - The Nevada Supreme Court ruled earlier this month that a district court erred in determining a man hurt in a car accident lacked standing to bring a claim.

Appellant Pedro Gallegos was injured by appellant David Gonzalez in a hit-and-run car accident.

At the time of the accident, Gonzalez was driving a car rented from respondent Malco Enterprises of Nevada Inc. d/b/a Budget Rent A Car of Las Vegas.

When renting the car, Gonzalez purchased a supplemental renter's liability insurance policy from Budget. This policy was issued by respondent First American Property and Casualty Insurance Co., and was managed by respondent Knight Management Insurance Services LLC.

Gallegos sued Gonzalez for injuries resulting from the accident and ultimately obtained a default judgment against him for more than $400,000.

Gonzalez failed to appear at scheduled judgment debtor exams, and Gallegos was unable to collect on the judgment. Accordingly, Gallegos sought a judicial assignment of Gonzalez's unasserted claims against respondents, which was granted.

The earlier district court assigned Gonzalez's unasserted claims for breach of contract, breach of fiduciary duties and breach of duty of good faith and fair dealing. The assigned claims related to his insurance policy with the respondents.

Gallegos then brought the assigned claims against the respondents in a separate district court action.

The respondents moved for summary judgment on the basis that the previous district court could not assign the right of action in a proceeding supplementary to the execution of the judgment and thus Gallegos lacked standing to bring Gonzalez's claims against them, among other things.

The district court in the underlying action concluded that the previous district court's assignment order was invalid and granted the respondents' motion for summary judgment, vacating the earlier assignment order.

Justice Ron D. Parraguirre, who authored the state high court's Aug. 4 opinion, said Gallegos "properly asserted" a right of action assigned to him by another district court.

The Court also concluded that the district court in the instant action erred in determining that Gallegos lacked standing to bring the claim and in granting summary judgment to the respondents on that basis.

"To resolve this appeal, we must determine whether a right of action held by a judgment debtor is property that can be judicially assigned in a proceeding supplementary to the execution of a judgment," the Court wrote.

"Nevada's statutory scheme regarding enforcement of judgments is laid out in NRS Chapter 21. NRS 21.320 provides that a district court 'may order any property of the judgment debtor not exempt from execution... to be applied toward the satisfaction of the judgment.' Accordingly, so long as a right of action is 'property... not exempt from execution,' it may be judicially assigned in satisfaction of a judgment."

According to NRS 21.080(1), "(a)ll goods, chattels, money and other property, real and personal, of the judgment debtor, or any interest therein of the judgment debtor not exempt by law, and all property and rights of property seized and held under attachment in the action, are liable to execution."

NRS 10.045 further defines "personal property" as including "money, goods, chattels, things in action and evidences of debt."

By definition, a "thing in action" is a "right to bring an action to recover a debt, money or thing," the Court said.

"Based on the above statutory authority, we conclude that rights of action held by a judgment debtor are personal property subject to execution in satisfaction of a judgment," Parraguirre wrote for the Court.

The Court, in reversing the district court's summary judgment, remanded the case.

From Legal Newsline: Reach Jessica Karmasek by email at

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