Anderson v. Mandalay Corp.

NRS 41.745(1)(c) makes employers vicariously liable for

employees' intentional torts if a plaintiff can show the intentional conduct

was "reasonably foreseeable under the facts and circumstances of the case

considering the nature and scope of [the employee's] employment." Here,

we are asked to determine whether it was reasonably foreseeable that an

employee would rape a hotel guest. We are also asked to determine

whether the employee's criminal conduct was so unforeseeable that direct

negligence claims against the employer would be futile. Based on the

particularized facts of this case, which are detailed below, we conclude a

reasonable jury could find that the employee's criminal conduct was

reasonably foreseeable. Similarly, we conclude direct negligence claims

against the employer would not be futile because a reasonable jury might

find that the criminal conduct was foreseeable. Accordingly, we reverse

and remand.

Cristie Anderson and her husband sued Mandalay Bay Resort

and Casino (Mandalay) after Alonzo Monroy Gonzalez, a Mandalay

employee, raped Anderson in her hotel room at Mandalay. Anderson and

her husband asserted claims against Mandalay for negligent hiring,

vicarious liability, and loss of consortium. During discovery, Anderson

asked for leave to amend her complaint to add claims for negligent

security, retention, and supervision. Mandalay sought summary

judgment, and at the summary judgment hearing, Anderson's counsel

abandoned all claims except the vicarious liability claim. The district

court granted Mandalay's motion for summary judgment, concluding

Mandalay was not vicariously liable for Gonzalez's criminal act. The

district court also denied, as futile, Anderson's motion to amend her

complaint. Anderson timely appealed those decisions. 2

Anderson came to Las Vegas on September 8, 2008, to attend

a trade show on behalf of her employer. She checked into room 8916 at

Mandalay. After performing some work-related duties, she and her

coworkers went out for dinner and drinks. Anderson became intoxicated

and returned to Mandalay around 2 a.m. on September 9, 2008.

Surveillance footage shows that she and Gonzalez shared an elevator; both

2Mandalay filed a notice of cross-appeal seeking attorney fees, costs,

and interest from Anderson. However, Mandalay never filed an opening

brief on cross-appeal, as required by NRAP 28.1(c)(2), and its answering

brief does not set forth its cross-appeal arguments. Therefore, Mandalay

has not actually presented this court with a cross-appeal.

exited on the eighth floor. Anderson entered her room, shut the door

behind her, and went to sleep.

Later, Anderson woke up vomiting and felt someone wiping

her face with a washcloth. She realized a uniformed man, later identified

as Gonzalez, was in her room. Gonzalez raped Anderson. He immediately

left the room when Anderson oriented herself. Anderson called the front

desk, and Mandalay security interviewed Gonzalez after finding him on

the eighth floor. He admitted to entering room 8916 but claimed he only

entered to sweep up broken glass that was in the hallway and underneath

the room's door. Gonzalez later claimed to have had consensual sex with

Anderson. Las Vegas Metropolitan Police took over the investigation, and

Gonzalez ultimately pleaded guilty to sexual assault.

Gonzalez worked at Mandalay as a House Person, whose

principle job duties are to clean the common areas of the hotel and assist

in cleaning and serving guest rooms, as needed. A House Person working

Gonzalez's shift would have little supervision. Mandalay provided

Gonzalez with a keycard that was traceable to him and opened the guest

rooms on his assigned floors. On the night in question, floors 8-12 were

assigned to him. Gonzalez used that keycard to enter Anderson's room.

Before hiring Gonzalez, Mandalay performed a criminal

background check using a social security number he provided. That

number was connected to Gonzalez's name and indicated he had no

criminal record. Mandalay solicited Gonzalez's employment references

and filled out 1-9 documents reporting Gonzalez's eligibility to work;

however, it is not clear that Mandalay contacted those references and

properly updated information on Gonzalez's 1-9.

Gonzalez's prior disciplinary history shows that Mandalay

suspended him for 31 days after he and two other men were implicated in

a series of insulting and threatening comments made over Mandalay's

employee radios. The allegations included using the radios to broadcast

the sound of toilets flushing, animal noises, and threats to a female

supervisor. The threats were "I know where you live Juanita," "I will be

waiting for you in the parking garage," and "You are a bitch Juanita and

you deserve what you are going to get." Although Mandalay never

definitively identified or ruled out Gonzalez as making any threats, it did

find that Gonzalez misused employee radios and lied about it.

During district court proceedings, Anderson presented

evidence of five prior sexual assaults perpetuated by Mandalay employees

on Mandalay's premises. The victims in three of the assaults were guests,

and two were other Mandalay employees. Additionally, evidence was

presented showing Mandalay received about one report a month claiming

an employee entered an occupied room without authorization. Anderson

submitted eight Las Vegas Metropolitan Police reports about Mandalay

employees stealing from guest rooms during unauthorized entries.

Anderson also presented in court comments from travel sites reporting

similar problems. Anderson also presented an expert report indicating

Mandalay had insufficient security when Gonzalez attacked Anderson,

and ongoing security defects created a volatile environment.

Ultimately, the district court granted Mandalay's motion for

summary judgment, concluding NRS 41.745(1) and WoodS v. Safeway, Inc.,

121 Nev. 724, 121 P.3d 1026 (2005), barred vicarious liability against

Mandalay because Gonzalez's acts were truly independent, not committed

in the course of the very task assigned, and not reasonably foreseeable.

The district court also denied as futile Anderson's request for leave to

amend.

DISCUSSION

On appeal, Anderson argues the district court erred in

granting Mandalay's motion for summary judgment. Additionally,

Anderson argues the district court erred in denying her leave to amend

her complaint.

Mandalay was not entitled to summary judgment

This court reviews summary judgment rulings de novo. Wood

v. Safeway, Inc., 121 Nev. 724, 729, 121 P.3d 1026, 1029 (2005). Summary

judgment is appropriate when the record shows there is no genuine issue

of material fact remaining, and the movant is entitled to judgment as a

matter of law. Id. (citing NRCP 56(c)). Therefore, summary judgment is

improper whenever "a reasonable jury could return a verdict for the nonmoving

party." Sprague v. Lucky Stores, Inc., 109 Nev. 247, 249, 849 P.2d

320, 322 (1993). When reviewing the record, "the evidence, and any

reasonable inferences drawn from it, must be viewed in a light most

favorable to the nonmoving party." Wood, 121 Nev. at 729, 121 P.3d at

1029.

IVRS 41.745(1)(c) sets forth a factual inquiry

NRS 41.745 makes employers vicariously liable for employees'

intentional torts when—among other circumstances—an employee's act is

"reasonably foreseeable under the facts and circumstances of the case

considering the nature and scope of his or her employment." NRS

41.745(1)(c). Inquiries focused on the facts and circumstances of a case are

typically factual, not legal. See, e.g., Mayfield v. Koroghli, 124 Nev. 343,

352, 184 P.3d 362, 368 (2008); Basile v. Union Plaza Hotel & Casino, 110

Nev. 1382, 1384, 887 P.2d 273, 275 (1994); see also 65 C.J.S. Negligence § 8

(2010) (stating that the question of negligence is "determined by a

consideration of all the particular set of facts and circumstances").

Further, the Legislature clarified NRS 41.745(1)(c)'s

reasonable foreseeability standard, stating the "conduct of an employee is

reasonably foreseeable if a person of ordinary intelligence and prudence

could have reasonably anticipated the conduct and the probability of

injury." NRS 41.745(1)(c). This definition of reasonable foreseeability

stems from premises liability cases, Hearing on A.B. 595 Before the

Assembly Judiciary Comm., 69th Leg. 13-14 (Nev., June 19, 1997) (citing

El Dorado Hotel, Inc. v. Brown, 100 Nev. 622, 627, 691 P.2d 436, 440

(1984), overruled on other grounds by Vinci v. Las Vegas Sands, Inc., 115

Nev. 243, 245, 984 P.2d 750, 751 (1999)), and this court has held its

determination presents an issue of fact, Basile, 110 Nev. . at 1384, 887 P.2d

at 275. Therefore, we conclude NRS 41.745(1)(c)'s reasonable

foreseeability standard sets forth a factual inquiry. 3

3NRS 41.745's legislative history clearly supports this conclusion.

The Legislature intended for NRS 41.745(1)(c) to reject this court's

conclusion that employers would be liable for the intentional torts of

employees when, "in the context of the particular enterprise Li an

employee's conduct is not so unusual or startling that it would seem unfair

to include the loss resulting from it among other costs of the employer's

business." State, Dep't of Human Res., Div. of Mental Hygiene & Mental

Retardation v. Jimenez, 113 Nev. 356, 365, 935 P.2d 274, 280 (1997)

(emphasis omitted) (quoting Rogers v. Kemper Constr, Co., 124 Cal. Rptr.

143, 148-49 (Ct. App. 1975)), opinion withdrawn, 113 Nev. 735, 941 P.2d

969 (1997); see Nev. Legis. Counsel Bureau, Research Div., AB595.EN, Bill

Summary: A.B. 595 1 (1997); Hearing on A.B. 595 Before the Assembly

Judiciary Comm., 69th Leg. 8-9, 14-15 (Nev., June 19, 1997). The bills

proponents read Jimenez as making employers strictly liable for

employees' intentional torts, and they believed NRS 41.745(1)(c)'s

reasonable foreseeability standard would allow employers to submit the

continued on next page . . .

A reasonable jury could conclude Gonzalez's act was reasonably

foreseeable

Because NRS 41.745(1)(c) presents a factual inquiry, summary

judgment is only proper if a reasonable jury could not rule in Anderson's

favor. Sprague, 109 Nev. at 249, 849 P.2d at 322. More specifically, we

must determine whether a reasonable jury could conclude Gonzalez's

conduct was "reasonably foreseeable under the facts and circumstances of

the case considering the nature and scope of [Gonzalez's] employment."

NRS 41.745(1)(c). We conclude a reasonable jury could find that

Gonzalez's conduct was reasonably foreseeable; therefore the district court

erred in granting Mandalay's motion for summary judgment. See Wood,

121 Nev. at 729, 121 P.3d at 1029 (this court reviews summary judgment

rulings de novo).

This court has considered reasonable foreseeability under NRS

41.745(1)(c) in only one published case. See id. at 739-40, 121 P.3d at

1036-37. In Wood, a janitor employed with a cleaning company raped a

Safeway employee at the Safeway store where they both worked. Id. at

727-28, 121 P.3d at 1028-29. There, the janitor had no criminal history;

the employer required proof of identification, checked employment

references, and filled out the proper immigration documents; and the

employer had no sexual harassment complaints over the last ten years.

Id. at 740, 121 P.3d at 1037. This court held, as a matter of law, that the

janitor's attack was not reasonably foreseeable, and the victim could not

. . . continued

issue of vicarious liability to a jury. See Hearing on A.B. 595 Before the

Assembly Judiciary Comm., 69th Leg. 9-10 (Nev., June 19, 1997).

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hold the janitor's employer vicariously liable for his intentional acts under

NRS 41.745(1)(c). Id.

According to Mandalay, Wood demonstrates that Gonzalez's

criminal conduct was unforeseeable. We disagree. After viewing the

evidence and drawing all reasonable inferences in Anderson's favor, Wood,

121 Nev. at 729, 121 P.3d at 1029, we conclude the facts and

circumstances here are sufficiently distinguishable from Wood for a

reasonable jury to determine that Gonzalez's act was reasonably

foreseeable under NRS 41.745(1)(c). The janitor in Wood was never the

subject of a sexual harassment complaint, and his employer had not had a

complaint of that nature in the past ten years. See id. at 740, 121 P.3d at

1037. Here, however, at least five Mandalay employees had sexually

assaulted guests and coworkers before Gonzalez attacked Anderson.

Additionally, Mandalay knew employees entrusted with keyed access to

occupied rooms abused that access to commit property crimes. Therefore,

Mandalay had notice its employees were capable of sexual assault, and

some employees abused their keycard access to enter guest rooms without

authorization. Moreover, Mandalay suspended Gonzalez for 31 days in

response to allegations that he harassed and threatened a female

supervisor. After Gonzalez's suspension ended, Mandalay restored his

keycard access to occupied rooms and assigned him to a shift with minimal

supervision. Considering the prior on-premises attacks, employees'

regular keycard abuse, Gonzalez's disciplinary history, and Mandalay's

decision to provide Gonzalez keyed access to guest rooms with minimal

supervision, a reasonable jury could conclude it was foreseeable that

Gonzalez would abuse his keycard access to sexually assault a Mandalay

guest.

Mandalay contends that no other state would hold it

vicariously liable for Gonzalez's act because that act could not have fallen

within the scope of his employment. This argument lacks merit for two

reasons. First, this argument mischaracterizes the relevant inquiry.

Generally, an employer is only liable for the intentional torts committed

within the scope of employment. See 27 Am. Jur. 2d Employment

Relationship § 356; Restatement (Second) of Agency § 219(1) (2010).

Reasonable foreseeability is often one of several considerations courts use

to determine whether an intentional tort was within the scope of

employment. See Restatement (Second) of Agency §§ 228(1)(d), 229(2)(f)

(201W; see also State, Dep't of Admin. v. Schallock, 941 P.2d 1275, 1282-84

(Ariz. 1997); Sage Club v. Hunt, 638 P.2d 161, 162-63 (Wyo. 1981).

Conversely, NRS 41.745(1) does not contain an overarching "scope of

employment" inquiry. Instead, NRS 41.745(1) promulgates three distinct

circumstances in which an employer is liable for an employee's intentional

tort: (1) the employee's act was not "a truly independent venture," (2) the

employee acted "in the course of the very task assigned," or (3) the

employee's act was "reasonably foreseeable under the facts and

circumstances of the case considering the nature and scope of his or her

employment." Therefore, Nevada will hold an employer vicariously liable

for an employee's intentional tort—even though it was outside the scope of

employment—if that intentional tort was "reasonably foreseeable under

the facts and circumstances of the case considering the nature and scope of

his or her employment." NRS 41.745(1)(c).

Second, other jurisdictions have concluded that sexual assault

can be reasonably foreseeable, either as part of a vicarious liability inquiry

or a direct negligence inquiry. For example, the Arizona Supreme Court

concluded a jury might properly find it was reasonably foreseeable that

one employee would rape another because the accused had a history of

sexually harassing female coworkers. Schallock, 941 P.2d at 1282-83

("One can hardly be surprised when sexual harassment that has occurred

for years continues."). North Dakota's Supreme Court similarly concluded

a jury could find it was reasonably foreseeable that a social worker would

sexually abuse a minor in foster care because such abuse was not

uncommon Nelson v. Gillette, 571 N.W.2d 332, 341-42 (N.D. 1997). New

Mexico's Court of Appeals concluded a jury might find a sexual assault

was reasonably foreseeable in a negligence action simply because the

employer knew the employee abused alcohol and became violent when

drinking. Pittard v. Four Seasons Motor Inn, Inc., 688 P.2d 333, 341 (N.M.

Ct. App. 1984). Thus, sexual assault is not unforeseeable, per se, and

Nevada is not alone in allowing juries to determine whether the facts and

circumstances of a case show that an employee's tortious conduct was

reasonably foreseeable. Considering the facts and circumstances here, a

reasonable jury could conclude Gonzalez's act was reasonably foreseeable.

The district court erred in concluding it would be futile for Anderson to

amend her complaint.

The district court denied as futile Anderson's motion for leave

to amend her complaint because it believed Anderson's claims for

negligent security, retention, and supervision could not succeed. We

disagree. Although we generally review a district court's decision on a

motion for leave to amend for abuse of discretion, Whealon v. Sterling, 121

Nev. 662, 665, 119 P.3d 1241, 1244 (2005), futility is a question of law

reviewed de novo because it is essentially an NRCP 12(b)(5) inquiry,

asking whether the plaintiff could plead facts that would entitle her to

relief See Buzz Stew, LLC v. City of N. Las Vegas, 124 Nev. 224, 227-28,

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181 P.3d 670, 672 (2008); see also Sanford v. Member Works, Inc., 625 F.3d

550, 557 (9th Cir. 2010) ("Where, as here, the district cour denies leave to

amend on futility grounds, we will uphold such denial if it is clear, upon de

nova review, that the complaint would not be saved by any amendment."

(internal quotation marks omitted)).

Because we hold that a reasonable jury could conclude

Gonzalez's attack was foreseeable, Anderson's proposed amendments are

not futile. Although unlawful conduct can interrupt and supersede the

causation between a negligent act and injury, an unlawful act will not

supersede causation if it was foreseeable. Bower v. Harrah's Laughlin,

Inc., 125 Nev. 470, 491-92, 215 P.3d 709, 724-25 (2009). Here, we have

already concluded a reasonable jury could find that Gonzalez's act was

reasonably foreseeable; therefore, amendment would not be futile.

Additionally, the district court erroneously relied on NRS

651.015 in concluding that Anderson's negligent security claim was futile.

That statute, titled "Civil liability of innkeepers for death or injury of

person on premises caused by person who is not employee," expressly

applies only when the injury is caused by a "person who is not an

employee under the control or supervision of the owner or keeper." NRS

651.015(1), (2) (emphasis added). Because Gonzalez was Mandalay's

employee, the district court erred in relying on NRS 651.015 at all.

We conclude that NRS 41.745(1)(c) sets forth a factual inquiry,

and a reasonable jury could find that Gonzalez's conduct was "reasonably"

foreseeable under the facts and circumstances of the case considering the

nature and scope of his employment." NRS 41.745(1)(c). Therefore,

the district court erred in granting Mandalay's motion for summary

judgment. The district court also erred in holding that it would be futile

for Anderson to amend her complaint to include claims for negligent

security, retention, and supervision because Gonzalez's criminal conduct

may not have been a superseding cause, and NRS 651.015 does not apply

here. Accordingly, we reverse the district court's order granting

Mandalay's motion for summary judgment and denying Anderson's motion

for leave to amend, and we remand this matter to the district court for

further proceedings.