Read the main articles from our “Specialty Courts” issue of COMMUNIQUÉ (April 2018) available online now:
- “Can a Specialty Court Help Your Client?” by John P. Aldrich, Esq.
- “10 Things to Know About Business Court” by Judge Nancy Allf and Adam Ellis, Esq.
- “Practicing Before the U.S. Tax Court” by Derek Hatch, Esq. and Szu-Ju Chang, Esq.
In the print edition, readers can read about court news, bar activities, and other practical content, including:
- View from the Bench of the Eighth Judicial District Court By Chief Judge Elizabeth Gonzalez
- 40 Year Club Luncheon Highlights by Steph Abbott
- Association of Legal Administrators Highlights” by Alice O’Hearn
- “Nevada Appellate Court Summaries” by Joe Tommasino, Esq.
- “Pro Bono Corner” by Amy Wilson, Esq.
- “Departments: Member Moves, New Members, and Court Changes, The Marketplace”
© 2018 The following articles were originally published in COMMUNIQUÉ, the official publication of the Clark County Bar Association. (April 2018). All rights reserved. For permission to reprint this content, contact the publisher Clark County Bar Association, 717 S. 8th Street, Las Vegas, NV 89101. Phone: (702) 387-6011.
Can a Specialty Court Help Your Client?
By John P. Aldrich, Esq.
This month’s issue of Communiqué includes articles about two of the specialty courts available in Clark County: Business Court and Tax Court. There are also specialty courts that provide essential opportunities for persons who are struggling with specific drug, behavioral, and/or dependency issues who find themselves in criminal court. The primary eligibility factor is whether a participant has “an identified alcohol substance abuse disorder or SMI (serious mental illness);” a history of violent offenses or drug trafficking can be a disqualifying factor. See Eighth Judicial District Court Specialty Court Programs, http://www.clarkcountycourts.us/departments/specialty-courts/, last visited 3/7/2018. The specialty courts include Adult Drug Court, Felony DUI Court, Mental Health Court, Juvenile Drug Court, Veterans Court, Family Treatment Court, Dependency Mother’s Court, Child Support Treatment Court, and the OPEN Program. For more information on each, turn to page 23 [of the printed publication].
When I was a young attorney working in the Clark County District Attorney’s Office, I saw first-hand how the Drug Court assisted those struggling with substance abuse. While there were many who struggled to make it through the program, I distinctly remember how Judge Jack Lehman praised those who graduated from Drug Court for their accomplishment. In those moments, there was a palpable feeling of hope for the Drug Court graduate and his or her family. In many instances, the specialty courts provide a way for a non-violent offender to receive treatment and avoid the cycle of being in and out of jail that often plagues those who suffer from these conditions.
Please take the time to learn about all of Clark County’s specialty courts so you are aware of the programs that are available to your clients and other members of the community who might benefit from those programs.
[NOTE: The text above is an excerpt from the author’s “A Message from the President of the Clark County Bar Association” COMMUNIQUÉ (April 2018). To read the full text of his message, read the print edition or the “Letter from the President” published online only through April 2018.]
John P. Aldrich is the founding partner of Aldrich Law Firm, Ltd. John has 18 years’ experience as a litigation attorney with a focus in business litigation, personal injury, and appellate matters. John is licensed to practice in the states of Nevada, Utah, and Idaho. John serves as President of the CCBA through December 2018.
10 Things to Know About Business Court
By Judge Nancy Allf and Adam Ellis, Esq.
1. The Business Court
The business court is a specialty court designed to provide close management of legally or factually complex commercial litigation, reduce disruption to businesses during litigation, and to provide consistent decisions to allow for long-term business planning. It was designed based on the business court models of Delaware, Maryland, Pennsylvania, and North Carolina. Currently, the business court in the Eighth Judicial District Court is comprised of Chief Judge Elizabeth Gonzalez, Judge Nancy Allf, Judge Kathleen Delaney, Judge Mark Denton, and Judge Joe Hardy. As of June 30, 2017, there were 438 cases assigned to the business court.
2. Qualifications and Experience of the Business Court Judges
All business court judges have extensive experience in business litigation. Further, each judge is required to undergo annual specialized training designed to apprise them of the most relevant and important business-related litigation issues.
3. Types of Cases That Qualify for Business Court
Jurisdiction of the business court is set out by EDCR 1.61. Most cases filed in the business court involve claims related to the formation, governance, ownership, and operation of business entities which are governed by Chapters 78-92A of the Nevada Revised Statutes. In addition to these cases, the business court has jurisdiction over cases involving:
- claims under the UCC;
- claims arising from business torts;
- claims arising from the purchase or sale of: (1) stock, (2) substantially all of the assets of a business, or (3) commercial real estate; and
- business franchise transactions and relationships. EDCR 1.61(a).
Moreover, EDCR 1.61(b) provides a non-exhaustive list of case types that do not fall within the jurisdiction of the business court. For example, personal injury cases, residential landlord-tenant disputes, malpractice cases, and employment law cases are not business matters and do not qualify for business court. EDCR 1.61(b).
4. How to Get Your Case into Business Court
Any party to a case may request that the matter be assigned to a business court judge. EDCR 1.61(c)(2). Commonly, business court designation is requested on the Business Court Cover Sheet and in the caption of the initial complaint. See id. Other parties may request business court designation in the initial appearance or first responsive pleading. Id. It should also be noted that there are procedures for a party to remove a case from business court if the situation warrants it. See EDCR 1.61(c)(3).
5. Business Court Matters Receive Enhanced Case Management
In order to achieve the goal of reducing disruption to businesses during litigation, business court judges have a duty to provide enhanced case management for all business court matters. This enhanced case management can include business court judges holding periodic status checks or requiring status reports to ensure cases are proceeding appropriately, holding early NRCP 16 conferences with the parties to flush out potential issues, retaining jurisdiction over all discovery disputes, and being available to the parties on short notice for hearings or settlement conferences. For example, every business court judge leaves at least one day open each week to preside over business court settlement conferences. Due to this schedule management, business court cases can be set for settlement conferences much earlier than general civil cases.
6. Injunctive Relief
One of the most attractive aspects to litigants of the business court tends to be the manner the Court is able to handle injunctive relief matters on an expedited basis. The Court regularly encourages preliminary injunction hearings to be consolidated with a trial on the merits which can significantly reduce litigation duration and the associated expense to the parties.
7. There Are Additional Filing Fees in Business Court Cases
NRS Chapter 19 sets out the fees for filing civil cases. While the filing fee for a single plaintiff general civil case is $270.00, the filing fee for a single plaintiff business court matter is $1,530.00. See Nev. Rev. Stat. §§ 19.013–.0315; see also Clark Cty. Code §§ 2.32.010, 2.32.040(a), 2.32.080. And while the filing fee to file an initial appearance for a single defendant to respond to a complaint in a general civil case is $223.00, the same fee in a business court matter is $1,483.00. Id. In both general civil cases and business court matters, each additional plaintiff named in the complaint or defendant named in an answer incurs a fee of $30.00. Nev. Rev. Stat. 19.0335(1).
8. Be Specific
Business court cases are usually factually and legally complex, often times having multiple parties on each side, as well as counterclaims, cross-claims, and third-party practice. Given the complex posture these cases take on, it is important for the parties to be very specific in regards to the relief they are requesting when moving the Court. For example, there are multiple grounds under which a party could move to dismiss, as well as multiple parties or claims a motion can be brought against. The Court should not be speculating as to your intent on any of these items. Further, sometimes certain claims or the involvement of some parties can be contingent on other claims or parties in the case. The Court takes all of this into consideration when preparing to make a ruling, so it is extremely advantageous for the parties to clearly and concisely state the exact relief they are requesting.
9. Oral Argument Should Be a Supplement
Given the complexities of business court cases, the legal issues and length of briefs can be rather extensive. Yet oral argument should not be used to rehash every point raised in a brief. Doing so dilutes the Court’s attention away from your best arguments and is often unnecessary as the judges are not only specifically trained to handle these issues, they thoroughly prepare in advance of business court hearings and are apprised of the relevant arguments. It is much more helpful and efficient to use oral argument to clearly and concisely present your best arguments to the judge and answer any questions the Court may have.
10. Know the Department’s Policies
Though the business court is one specialty court, it is comprised of five different judges who sometimes have differing procedures and policies. It is important to understand the procedures and policies of the department your case is in front of. When in doubt about a department specific procedure, do not hesitate to call and ask the department’s judicial executive assistant.
Nancy Allf is the presiding judge in Department 27 of the Eighth Judicial District Court and is one of five judges assigned Business Court cases. She was president of the CCBA in 1999.
Adam Ellis graduated summa cum laude from the William S. Boyd School of Law in 2017. He is currently the law clerk to the Honorable Nancy Allf and will be joining the law firm of Snell & Wilmer after his clerkship.
Practicing Before the U.S. Tax Court
By Derek Hatch, Esq. and Szu-Ju Chang, Esq.
Unbeknownst to most attorneys, over 70% of United States Tax Court petitions are filed by pro se taxpayers, and they are often confused and overwhelmed with the litigation process. Practicing before the tax court can be intimidating; however, attorneys can learn how to assist pro se taxpayers by working with experienced tax attorneys. In this article, we want to provide a glimpse of how you could practice before the U.S. Tax Court, and our goal is to pique your interest into taking a pro bono tax court case in the future.
The United States Tax Court is a specialty court established by Congress under Article I of the U.S. Constitution. The tax court’s jurisdiction allows taxpayers to dispute their tax deficiency before paying any disputed amount, as opposed to the U.S. district courts and the Court of Federal Claims which require payment of the deficiency and filing suit for refund. The tax court’s jurisdiction also includes the authority to redetermine transferee liability, make certain types of declaratory judgments, redetermine worker classification, determine relief from joint and several liability on a joint return (i.e., innocent spouse relief), review certain collection actions, award administrative and litigation costs, order abatement of interest, adjust partnership items, and review awards to whistleblowers who provide information to the Internal Revenue Service (IRS).
Currently, the tax court sits in 74 cities throughout the United States. Unlike the majority of the federal and state courts, and although physically located in Washington, D.C., 16 Judges, ten Senior Judges, and five Special Trial Judges alternate and preside in various designated cities during each tax court session.
To enter into an appearance for your client in tax court, you first need to be admitted to practice before the court. The application process is fast and simple. An attorney who is licensed to practice law must file Form 30, Application for Admission to Practice; a current court certification of good standing; and a $35 application fee to the admission clerk of the tax court. Certainly, there are circumstances where you could settle your client’s case without entering an appearance for your client.
A signed Form 2848, Power of Attorney and Declaration of Representative (POA) gives an attorney authority to represent clients before the IRS. The authority under a POA also includes negotiating clients’ cases with the IRS Chief Counsel and Office of Appeals (Appeals) and accessing clients’ tax transcripts on the IRS Transcript Delivery Service. Although attorneys may communicate with the IRS Chief Counsel through a fully executed POA, petitioners are still considered unrepresented in tax court for purposes of the tax court rules unless the attorney has formally filed an entry of appearance in the case. Thus, an attorney who has not entered an appearance does not have the authority, for example, to bind the petitioner to a stipulation of facts or stipulated decision, sign court documents such as a motion for continuance, or to communicate with the court on the petitioner’s behalf. Nonetheless, because the Office of Chief Counsel recognizes the significant assistance pro bono representatives provide to pro se taxpayers, both the court and Chief Counsel’s Office expect and encourage the IRS Chief Counsel attorneys to work with authorized representatives on their tax court cases even though no formal entry of appearance has been made in a particular case. However, because of the limitations placed on such representation, an attorney should enter his or her appearance in order to advocate for taxpayers effectively. See Chief Counsel Notices CC-2014-003 and CC-2017-006.
A case in Tax Court begins with filing the petition. Once your client receives a statutory Notice of Deficiency, Notice of Determination, or Final Notice of Determination, you have 90 days from the date of the notice to respond by filing a tax court petition. The deadline to petition the court is 150 days if the notice is addressed to a person who is outside the country. A practice tip is that if you have to file a last-minute petition, you should make sure to hand-deliver it to the postal office and mail it with registered or certified mail with return receipt requested. Timely filing a petition is a jurisdiction requirement, which is set by statute and cannot be extended by the court. Presently, all petitions must be filed at the U.S. Post Office or other similar delivery service and cannot be electronically filed. Internal Revenue Code (IRC) § 7502(b), a section commonly referred to as the “mailbox rule,” provides that the date that an item—including a tax court petition—is postmarked and mailed is also the date the item is considered filed. There has been substantial tax court litigation on whether a petition was timely filed, and it is an issue you will want to avoid. See Pearson v. Commissioner, 149 T.C. No. 20 & Tilden v. Commissioner, No. 15-3838.
A petition must include: (1) A copy of any Notice of Deficiency, Notice of Determination, or Final Notice of Determination; (2) Statement of Taxpayer Identification Number; (3) The Request for Place of Trial; and (4) the $60 filing fee. Since all documents, except the Statement of Taxpayer Identification Number, filed in Tax Court are public records pursuant to IRC § 7461, be sure to redact all identifying data (i.e., SSN and addresses) when submitting a copy of the IRS notice. If your client filed the petition and failed to redact their identifying data before retaining your representation, you should file a motion to seal with good cause. See Tax Court Rule 103.
A well-drafted petition provides you a great start toward winning your case. Your petition must comply with tax court’s Rule of Practice and Procedure. In the petition, you need to address each allegation of mistakes made by the IRS with concise responses. Any issue you choose not to raise is conceded and the deficiency related to that issue will be collected even while the case is still pending.
The IRS is required to file an answer within 60 days from the date of service or to make a motion with respect to the petition within 45 days from the date of service. Tax Court Rule 36. Pursuant to Branerton Corp. v. Commissioner, 61 T.C. 691 (1974), the tax court is insistent that the parties use informal efforts to obtain needed information for the preparation of the case for trial. The court expects the parties to discuss, deliberate, and exchange ideas, thoughts, and opinions on an informal basis before resorting to the formal discovery methods specified in the rules. Accordingly, after answers are filed, the majority of the cases will be referred to appeals for settlement consideration. The assigned appeals officer will contact attorneys by a letter or by phone to schedule a teleconference. However, if you believe a face-to-face conference is to your client’s best interest, you could request the appeals officer to transfer the jurisdiction to the local field appeals office. IRM § 18.104.22.168.1
A case is placed on the calendar for trial when the tax court grants a petitioner a hearing. Both petitioners and the Commissioner of Internal Revenue (respondent) will receive a Notice of Trial approximately five months before the initial trial session. Appeals officers will forward any unresolved case to the IRS counsel for trial preparation. During this period, you should continue to negotiate with the IRS counsel to reach a settlement.
A vast majority of the tax court cases typically settle before the trial session. On the morning of each trial session, the trial clerk calls through the docket list to schedule hearings and trials for any unsettled cases and to provide final status update on last minute settled cases. If you reach a last-minute settlement with the IRS counsel, and both parties have signed the proposed decision, you should still plan to appear at the calendar call.
We hope this brief tax court summary highlights the unique opportunities tax court can provide to a licensed attorney. If you are interested in practicing before the U.S. Tax Court, we encourage you to join the local Low Income Taxpayer Clinics to participate in a calendar call program.
Derek N. Hatch is a tax and estate planning attorney at Jeffrey Burr, Ltd. and represents clients before all federal and state tax agencies, including the IRS and Nevada Department of Taxation. Mr. Hatch received his law degree from Chapman University School of Law and also holds an LL.M. in taxation.
Szu-Ju Chang is a tax attorney at Nevada Legal Services’ Low Income Taxpayer Clinic. She focuses her practice on resolving federal tax controversies and is licensed to practice in Washington, D.C., Illinois, and Nevada.
COMMUNIQUÉ is published eleven times per year with an issue published monthly except for July by the Clark County Bar Association, P.O. Box 657, Las Vegas, NV 89125-0657. Phone: (702) 387-6011.
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