Liberal Amendment After Intervening Changes in Law:
State, Commissioner of Insurance v. Chur and NRCP 15

1. Introduction

The Nevada Supreme Court’s en banc decision in State of Nevada, Commissioner of Insurance, as Receiver of Lewis and Clark LTC Risk Retention Group, Inc. v. Chur, 141 Nev., Adv. Op. 69 (Dec. 23, 2025), establishes an important procedural principle: when the governing law materially changes or is significantly clarified while litigation is pending, district courts should strongly favor granting leave to amend under NRCP 15 so that claims can be evaluated under the correct legal standard.

The decision arises from litigation brought by the Nevada Commissioner of Insurance, acting as receiver of an insolvent risk retention group, Lewis & Clark LTC Risk Retention Group, Inc. (“L&C”). The Commissioner sued:

The individual directors of L&C (the “Directors”); and
Three corporate reinsurance-related entities (the “Corporate Defendants”).

While the case was pending, the Nevada Supreme Court decided Chur v. Eighth Judicial District Court, 136 Nev. 68, 458 P.3d 336 (2020) (“Chur I”), which changed the understanding of how plaintiffs must plead and prove personal liability against corporate directors under NRS 78.138. Relying on Chur I, the district court dismissed the Directors and refused to allow the Commissioner to amend the complaint to meet the new standard.

In this new opinion (“Chur II,” although the Court does not use that label), the Nevada Supreme Court:

Holds that Chur I did effect a material change in Nevada law;
Concludes the district court abused its discretion in denying leave to amend under NRCP 15(a);
Clarifies how the traditional Rule 15 factors (bad faith, undue delay, prejudice, futility, prior amendments) apply when law changes mid‑litigation; and
Vacates a related order on attorney fees because, once the underlying judgment for the Directors is reversed, they are no longer prevailing parties.

The case has both procedural and substantive significance: procedurally, it confirms a strong Nevada policy favoring amendment to conform to intervening precedent; substantively, it confirms that knowing violations of administrative regulations can qualify as a “knowing violation of law” under NRS 78.138(7)(b)(2) when properly pleaded.

2. Background of the Case

2.1 Parties and Receivership

Lewis & Clark LTC Risk Retention Group, Inc. (L&C) – a risk retention group providing long-term care insurance. Risk retention groups are specialized insurance entities regulated under NRS Chapter 695E.
Commissioner of Insurance – appointed by the district court as receiver for L&C after its financial distress, and later ordered to liquidate the company. As receiver, the Commissioner is authorized to bring suits on behalf of the insurer, its policyholders, and other stakeholders.
The Directors – eight individual directors of L&C: Robert Chur, Steve Fogg, Mark Garber, Carol Harter, Robert Hurlbut, Barbara Lumpkin, Jeff Marshall, and Eric Stickels.
The Corporate Defendants – Uni-Ter Underwriting Management Corp., Uni-Ter Claims Services Corp., and U.S. RE Corp., alleged to have acted as reinsurance brokers or managers.

In 2013, the district court placed L&C into liquidation and expressly authorized the Commissioner to:

Commence suits in L&C’s name or in the Commissioner’s own name; and
Prosecute actions on behalf of policyholders, members, or shareholders against any officer or “other person.”

Acting under that authority, the Commissioner sued both the Directors and the Corporate Defendants, alleging:

Gross negligence;
Breaches of fiduciary duty; and
Other tort claims related to L&C’s insolvency.

2.2 The First Supreme Court Decision: Chur I

The Directors initially moved for judgment on the pleadings, which the district court denied. The Directors then sought extraordinary relief in the Nevada Supreme Court by petition for a writ of mandamus. The district court stayed proceedings during that writ proceeding.

In Chur I, the Nevada Supreme Court held:

NRS 78.138(7) provides the exclusive avenue for imposing personal liability on corporate directors and officers for damages arising from official conduct.
Under NRS 78.138(7)(b), personal liability can arise only for:
- Intentional misconduct;
- Fraud; or
- A knowing violation of law.
Allegations of gross negligence alone are not actionable against directors under this statute.

In reaching that conclusion, Chur I expressly disavowed prior language in Shoen v. SAC Holding Corp., 122 Nev. 621, 137 P.3d 1171 (2006), which had suggested a more flexible, bifurcated approach to breaches of the fiduciary duties of care and loyalty, including application of a “gross negligence” standard. Chur I recognized that the statutory requirement of intentional misconduct or knowing violation of law is “an appreciably higher standard than gross negligence.”

Because the original complaint alleged only gross negligence by the Directors, Chur I directed the district court to grant judgment on the pleadings in favor of the Directors—but explicitly left to the district court’s discretion whether to grant the Commissioner leave to amend the complaint to conform to the new standard.

2.3 Motion to Amend After Chur I

After the district court lifted the stay, the Commissioner moved—one day later—for leave to file an amended complaint. The Commissioner argued:

Chur I was a “recent change in Nevada law” that “substantially changed the pleading requirements”; and
The complaint, originally drafted under Shoen, needed additional factual allegations to satisfy the standard clarified in Chur I.

The proposed amended complaint alleged that:

Each Director breached fiduciary duties owed to L&C;
The business judgment rule did not shield those breaches; and
The Directors’ conduct involved intentional and knowing misconduct and/or knowing violations of law.

Among other things, the Commissioner alleged that the Directors:

Knew the risks of using an unlicensed reinsurance broker (the Corporate Defendants);
Knew or should have known that financial information was inaccurate or incomplete;
Failed to properly execute agreements;
Failed to update business plans appropriately;
Approved projects outside underwriting guidelines; and
Operated L&C in a hazardous financial condition, violating multiple Nevada statutes and regulations, including:
- NAC 694C.300 (prohibiting unauthorized persons from acting as manager, broker, or agent for a captive insurer);
- NAC 683A.530(7) (regulating managing general agents’ authority to bind reinsurance or retrocessions);
- NRS 695E.200 (prohibiting a risk retention group from operating while financially impaired or in a hazardous financial condition).

2.4 District Court’s Denial of Leave to Amend

The Directors opposed the motion, arguing:

The Commissioner had long known the underlying facts and therefore unreasonably delayed asserting these “new” allegations;
The motion was untimely and brought in bad faith;
They would be prejudiced by additional discovery and expense; and
The new claims were time‑barred and did not “relate back” under NRCP 15(c).

The district court agreed with the Directors and denied leave to amend, finding:

Untimeliness and undue delay;
Prejudice to the Directors; and
Futility of amendment because the new theories did not relate back and were thus barred by the two‑year statute of limitations for torts (NRS 11.190(4)(e)).

The court then entered judgment in favor of the Directors. The Commissioner appealed (Docket No. 85668).

2.5 Attorney Fees Dispute

After they were dismissed, the Directors served an offer of judgment on the Commissioner and then moved for attorney fees and costs under NRCP 68 and NRS 18.020, arguing they were the “prevailing party.” The district court:

Found the requested fees and costs reasonable; but
Denied the motion, holding that the Commissioner, as receiver, was immune from liability for such fees and costs under NRS 696B.565(1).

The Directors appealed the denial of fees and costs (Docket No. 85728).

3. Summary of the Supreme Court’s Opinion

3.1 Core Holdings

The Nevada Supreme Court’s principal rulings are:

Intervening change in law warrants liberal amendment:
- Chur I constituted a “material change in the law” regarding personal liability of corporate directors and officers under NRS 78.138(7).
- Given that change—and the strong policy of NRCP 15(a)(2) that leave to amend “should be freely given when justice so requires”—the district court abused its discretion in denying the Commissioner leave to amend to plead claims under the new standard.
No bad faith, undue delay, or undue prejudice:
- The Commissioner moved to amend one day after the stay was lifted; this did not evidence bad faith or undue delay.
Amendment was not futile:
- The proposed amended complaint stated potentially viable claims for breaches of fiduciary duty under NRS 78.138(7) based on alleged intentional misconduct and knowing violations of law.
- Alleged knowing violations of Nevada administrative regulations (NAC 694C.300, NAC 683A.530(7)) can, if proved, constitute a “knowing violation of law” under NRS 78.138(7)(b)(2) because regulations have the force of law (NRS 233B.040(1)(a)).
- The new allegations related back to the original, timely complaint under NRCP 15(c)(1) because they arose from the same conduct and transactions concerning L&C’s operation and insolvency.
- The Commissioner’s NRS 695E.200 claim was not facially defective; the Commissioner sufficiently alleged that the Directors operated L&C while in a hazardous financial condition.
Commissioner was “aggrieved” and not estopped:
- The Commissioner was aggrieved by the judgment dismissing the Directors, even though he later prevailed at trial against the Corporate Defendants.
- The doctrines of appellate “aggrievement” and judicial estoppel did not bar his appeal or his attempt to proceed under revised legal theories consistent with Chur I.
Attorney fees order vacated:
- Because the Court reversed the judgment for the Directors, they are no longer prevailing parties and cannot obtain fees or costs based on their earlier offer of judgment.
- The Court therefore vacated the district court’s order denying fees and did not reach the question whether the Commissioner is immune from such fees under NRS 696B.565.

3.2 Disposition

Docket No. 85668 – The Court:
- Reversed the August 10, 2020 order denying leave to amend; and
- Reversed the August 13, 2020 judgment in favor of the Directors.
Docket No. 85728 – The Court vacated the post‑judgment order denying attorney fees and costs.
Remand – The case was remanded for further proceedings consistent with the opinion, including consideration of the amended complaint.

4. Detailed Analysis

4.1 The Legal Framework: NRCP 15 and Director Liability Under NRS 78.138

4.1.1 NRCP 15(a)(2): Leave to Amend “Freely Given”

NRCP 15(a)(2) mirrors the federal rule and provides that a party may amend its pleading with the court’s leave, and “[t]he court should freely give leave when justice so requires.” The Nevada Supreme Court has long applied this principle liberally, echoing the U.S. Supreme Court’s instruction in Foman v. Davis, 371 U.S. 178 (1962), that this mandate “is to be heeded.” See Adamson v. Bowker, 85 Nev. 115, 121, 450 P.2d 796, 800 (1969).

Drawing on Ninth Circuit precedent interpreting the analogous federal rule, the Court identifies five central factors for analyzing a motion to amend:

Bad faith;
Undue delay;
Prejudice to the opposing party;
Futility of amendment; and
Whether the plaintiff has previously amended the complaint.

This formulation comes from Johnson v. Buckley, 356 F.3d 1067, 1077 (9th Cir. 2004), and is treated as persuasive authority under Willard v. Berry-Hinckley Industries, 139 Nev. 516, 523, 539 P.3d 250, 257 (2023).

4.1.2 When a “Change in Law” Triggers Liberal Amendment

The Court expressly endorses a general principle drawn from secondary authority and federal cases:

61A Am. Jur. 2d Pleading § 675 – leave to amend should be granted liberally when the law governing the subject matter of the proposed amendment is revised during the pendency of the litigation.
Teamsters Local 617 Pension & Welfare Funds v. Apollo Group, Inc., 282 F.R.D. 216 (D. Ariz. 2012) – a “change in law” occurs when a decision substantively alters existing law, such as by overruling prior authority or shifting the governing analytical framework.
Doe I v. Nestle USA, Inc., 766 F.3d 1013 (9th Cir. 2014) – it is “common practice” to allow plaintiffs to amend to accommodate changes in the law, unless amendment would clearly be futile.
Moss v. United States Secret Service, 572 F.3d 962 (9th Cir. 2009) – plaintiffs who initiated lawsuits without the benefit of the Supreme Court’s new pleading standards “deserve a chance” to supplement their factual allegations in line with the updated requirements.

Building on these authorities, the Nevada Supreme Court states a clear policy:

We encourage district courts to give considerable weight in favor of granting leave to amend a complaint in light of an intervening significant change or clarification in the law.

This is the central procedural principle of the opinion and will guide future Nevada practice under NRCP 15.

4.1.3 Substantive Backdrop: NRS 78.138 and the Shift from Gross Negligence to Intentional Misconduct

NRS 78.138 codifies the business judgment rule and limits director and officer liability for actions taken in their official capacity. Under subsection (7), a director or officer is not individually liable for damages unless:

There is a breach of fiduciary duty; and
The breach involves “intentional misconduct, fraud or a knowing violation of law.” NRS 78.138(7)(b).

Before Chur I, Shoen v. SAC Holding Corp. suggested that a director’s duty of care could be violated by conduct amounting to gross negligence, creating ambiguity about whether gross negligence alone could lead to personal liability.

Chur I resolved that ambiguity by:

Clarifying that NRS 78.138(7) is the sole avenue for personal liability; and
Holding that the statute’s intentional-misconduct/knowing-violation standard is “an appreciably higher standard than gross negligence.”

In Chur II, the Court confirms that this was not a trivial or purely clarifying restatement; rather, Chur I effected a “material change in the law” that entitled the Commissioner to adjust his pleadings.

4.2 Application of NRCP 15 Factors in Light of the Change in Law

4.2.1 Bad Faith

Bad faith in the amendment context generally requires misconduct such as:

Withholding known facts for an extended period without explanation;
Changing substantive factual allegations between versions to evade dismissal; or
Pursuing claims known to be legally or factually baseless.

The Court cites United States ex rel. Nicholson v. MedCom Carolinas, Inc., 42 F.4th 185 (4th Cir. 2022), as illustrative authority on bad faith in the amendment context.

Here, the Court found no bad faith because:

The Commissioner moved to amend one day after the stay was lifted; there was no extended, unexplained delay.
The proposed amendment did not alter the basic factual scenario; it primarily added allegations regarding mental state (intentionality, knowledge) and specific statutory/regulatory violations to meet the clarified standard in Chur I.
At the time the original complaint was filed, Chur I was not the law; the Commissioner could not be faulted for relying on the then‑controlling Shoen standard.
Disputes about discovery (e.g., adequacy of an NRCP 30(b)(6) witness) did not bear on the Commissioner’s motive in seeking amendment and therefore did not demonstrate bad faith.

Under Mack v. Estate of Mack, 125 Nev. 80, 91, 206 P.3d 98, 106 (2009), appellate courts may draw inferences from the record where the district court’s findings are sparse. Here, those inferences supported the Commissioner’s good faith.

4.2.2 Undue Delay and Prejudice

“Undue prejudice” in this context typically exists when an amendment:

Introduces entirely new claims or theories late in the case, especially on the eve of trial;
Requires extensive new discovery, including unavailable witnesses;
Substantially delays final resolution; or
Otherwise unfairly burdens the opposing party in a way not justified by the interests of justice.

The Court cites A. Cherney Disposal Co. v. Chicago & Suburban Refuse Disposal Corp., 68 F.R.D. 383 (N.D. Ill. 1975), as an example of typical prejudice scenarios, and Pasternack v. Shrader, 863 F.3d 162 (2d Cir. 2017), for the proposition that delay and expense alone are usually insufficient to deny leave to amend.

Applying these principles, the Court held:

The amendment did not come on the eve of trial and did not introduce fundamentally new claims divorced from the original conduct; it simply updated legal theories and mental‑state allegations to conform to Chur I.
Any additional discovery required would be modest, given that the same core directors, transactions, and corporate conduct were already at issue.
Alleged unavailability of witnesses was more attributable to the time that elapsed between the denial of leave, the final judgment, and the appeal—not to the Commissioner’s prompt motion to amend after the change in law.
Most importantly, denying amendment would effectively prevent the Commissioner from ever having his claims tested under the correct legal standard, a result the Court deemed “unjust.”

In balancing inconvenience and expense against fairness and the mandate of NRCP 15, the Court gave decisive weight to the need to resolve the dispute “on the correct law pronounced in Chur I.”

4.2.3 Futility

Amendment is futile only if, as a matter of law, “the complaint, as amended, would fail to state a claim upon which relief could be granted.” The Court quotes this standard from Harris v. Steadman, 160 F. Supp. 3d 814, 817 (E.D. Pa. 2016), and also references Halcrow, Inc. v. Eighth Judicial District Court, 129 Nev. 394, 398, 302 P.3d 1148, 1152 (2013).

The Directors argued futility on three main fronts:

Regulatory violations cannot represent negligence per se and therefore cannot be “knowing violations of law.”
The new claims were barred by the two‑year statute of limitations, NRS 11.190(4)(e).
The claim based on NRS 695E.200 failed as a matter of law.

The Court rejected each of these futility arguments.

(a) Administrative Regulations and “Knowing Violation of Law”

The Directors relied on Price v. Sinnott, 85 Nev. 600, 460 P.2d 837 (1969), which held that violation of an administrative regulation is “only evidence of negligence; not negligence per se.” They extrapolated that a regulatory violation therefore cannot be a “knowing violation of law” for purposes of NRS 78.138(7)(b)(2).

The Court found this reasoning misplaced:

Price addressed whether violation of a regulation automatically established negligence (negligence per se), not whether regulations constitute “law” when willfully violated.
NRS 233B.040(1)(a) explicitly states that properly promulgated regulations have “the force of law.”
If the Commissioner can prove that the Directors knowingly violated NAC 694C.300 or NAC 683A.530(7), those knowing violations could satisfy the “knowing violation of law” requirement of NRS 78.138(7)(b)(2).

Thus, it was not futile to plead director liability based on alleged deliberate regulatory violations.

(b) Statute of Limitations and Relation Back (NRCP 15(c)(1))

Under NRS 11.190(4)(e), tort claims must be brought within two years. The Directors argued that, to the extent the Commissioner was now asserting new legal theories (intentional misconduct, knowing violation of law) or new statutory/regulatory bases, those claims were newly asserted and thus time‑barred.

The Court invoked NRCP 15(c)(1), which provides that an amendment relates back to the original pleading when “the amendment asserts a claim or defense that arose out of the conduct, transaction, or occurrence set out—or attempted to be set out—in the original pleading.”

Because:

Both the original and the proposed amended complaint concerned the same directors, the same insurer (L&C), and the same core course of conduct leading to L&C’s insolvency;
The amendment refined the legal theory (from gross negligence to intentional misconduct/knowing violation) and added detail rather than introducing a brand new transaction;

the Court held that the amendment arose out of the same “conduct, transaction, or occurrence.” Accordingly, the amended claims would relate back and were not barred by the statute of limitations.

(c) NRS 695E.200 Claim

NRS 695E.200(3) prohibits a risk retention group from operating “while financially impaired or in a hazardous financial condition.” The Directors argued that they were “within their rights” to try to improve the company’s position by continuing operations, selling more policies, and changing underwriting.

The Court correctly identified this as a merits defense, not a basis to deny amendment as futile. At the pleading stage, the Commissioner only needed to:

Set out a plausible claim under NRCP 8; and
Allege facts showing that L&C operated in a hazardous financial condition in violation of NRS 695E.200.

Because the proposed complaint did so, the claim was not facially defective, and futility was not established.

4.3 Estoppel and Appellate Aggrievement

4.3.1 Aggrieved Party Status Under NRAP 3A

Under NRAP 3A(a), only a party who is “aggrieved” by an appealable order or judgment may appeal. A “final judgment” is one that resolves all issues and leaves nothing for further adjudication except collateral matters like attorney fees. See Lee v. GNLV Corp., 116 Nev. 424, 426, 996 P.2d 416, 417 (2000).

The Directors argued that the Commissioner was not aggrieved by the final judgment because he ultimately obtained a favorable judgment against the Corporate Defendants (after they went to trial) and recovered damages.

The Court rejected this argument:

The Commissioner sought relief against two distinct sets of defendants: the Directors and the Corporate Defendants.
The order denying leave to amend and dismissing the Directors foreclosed the Commissioner from pursuing potential additional or alternative relief against the Directors in their individual capacities.
Even though he prevailed against the Corporate Defendants, he remained “aggrieved” by the portion of the judgment eliminating his claims against the Directors.

Therefore, the Commissioner was entitled to appeal the final judgment as to the Directors.

4.3.2 Judicial Estoppel

Judicial estoppel prevents a party from deliberately adopting inconsistent positions in successive judicial proceedings to gain unfair advantage. The Court, citing Marcuse v. Del Webb Communities, Inc., 123 Nev. 278, 287, 163 P.3d 462, 468–69 (2007), identifies five elements:

The same party took two positions;
In judicial or quasi‑judicial proceedings;
The party was successful in asserting the first position;
The two positions are totally inconsistent; and
The first position was not taken due to ignorance, fraud, or mistake.

The Directors contended the Commissioner was estopped from:

Appealing, because he prevailed at trial against the Corporate Defendants; and
Pursuing new theories of liability against the Directors inconsistent with his trial posture.

The Court found no basis for judicial estoppel:

There was no clear, “totally inconsistent” position shown in the record.
It is not inconsistent to claim that:
- The Corporate Defendants are liable for certain misconduct; and
- The Directors are also liable for distinct or overlapping conduct contributing to L&C’s losses.
Whether judicial estoppel might apply to specific factual or legal positions is properly raised as an affirmative defense in the trial court under NRCP 8(c)(1)(G).

The Court thus held that speculative or disputed assertions of inconsistency are not a proper basis to deny leave to amend.

4.4 Attorney Fees, Prevailing Party Status, and Statutory Immunity

4.4.1 Offer of Judgment Fees Under NRCP 68 and NRS 18.020

NRCP 68 provides that:

If a party makes an offer of judgment; and
The offeree fails to obtain a more favorable result; then
The offeror is entitled to recover certain post‑offer costs and, in some circumstances, attorney fees.

NRS 18.020 authorizes the recovery of costs by a prevailing party. In Gunderson v. D.R. Horton, Inc., 130 Nev. 67, 80, 319 P.3d 606, 615 (2014), the Court emphasized that decisions awarding or denying fees and costs are generally reviewed for abuse of discretion.

However, as Cain v. Price, 134 Nev. 193, 198, 415 P.3d 25, 30 (2018), and Roe v. Roe, 139 Nev. 163, 183, 535 P.3d 274, 293 (Ct. App. 2023), demonstrate, once the underlying judgment is reversed, the party previously deemed “prevailing” may lose that status, and any associated fee award must be revisited or vacated.

Here:

The Directors served an offer of judgment and ultimately obtained dismissal in the district court;
The district court found the requested fees and costs reasonable but denied them on the ground of statutory immunity for the Commissioner;
The Supreme Court reversed the underlying judgment for the Directors, so they are no longer prevailing parties at this stage.

Because the Directors now lack prevailing-party status, the Supreme Court vacated the fee‑denial order and found it unnecessary to resolve the underlying immunity question.

4.4.2 Statutory Immunity: NRS 696B.565

NRS 696B.565(1) provides the Commissioner, as receiver, immunity from:

any claim for damage to or loss of property or personal injury or other civil liability caused by or resulting from any alleged act, error or omission by the Commissioner or the Commissioner’s agents in fulfilling their duties.

The district court relied on this statute to deny the Directors’ fee request. The Supreme Court notes:

Statutory immunity functions as an affirmative defense that must be raised by the protected party or it may be waived, citing Webb ex rel. Webb v. Clark County School District, 125 Nev. 611, 619–20, 218 P.3d 1239, 1245–46 (2009), which analyzed a similar federal statutory immunity (the Coverdell Act).
Following Price Trucking Corp. v. Norampac Industries, Inc., 748 F.3d 75, 81 n.6 (2d Cir. 2014), an appellate court need not decide whether a defense was properly asserted if a threshold requirement (here, prevailing‑party status) is lacking.

Since the Directors are not prevailing parties after the Court’s reversal, the statutory immunity issue is not ripe for determination and remains unresolved for future cases.

5. Clarification of Complex Legal Concepts

5.1 “Change in Law” vs. Clarification

A “change in law” for purposes of amendment is not limited to legislative changes. It also includes:

Court decisions that overrule or partially overrule prior cases; or
Court decisions that significantly alter the legal test or standard that must be satisfied, even if they do not formally overrule a case.

Here, Chur I is treated as a substantive change because it:

Repudiated prior language in Shoen that allowed gross‑negligence theories; and
Declared that NRS 78.138(7) is the sole route to director liability and requires intentional misconduct or knowing violation of law.

5.2 Business Judgment Rule and Director Liability (NRS 78.138)

The business judgment rule protects directors from liability when they act:

In good faith;
In what they reasonably believe to be in the best interest of the corporation; and
On an informed basis.

NRS 78.138 codifies this defense and strictly limits personal liability. After Chur I:

Directors cannot be held personally liable for mere negligence or gross negligence in the performance of their duties.
Personal liability arises only where there is:
- a breach of fiduciary duty; and
- intentional misconduct, fraud, or a knowing violation of law.

Chur II allows plaintiffs, when law changes, to amend pleadings to attempt to meet this stricter standard.

5.3 Gross Negligence vs. Intentional Misconduct/Knowing Violation

Gross negligence – a heightened form of carelessness, more serious than ordinary negligence, but not involving deliberate wrongdoing or conscious disregard of known legal duties.
Intentional misconduct – actions taken with the purpose of causing the result or with knowledge that the result is substantially certain to occur.
Knowing violation of law – acting with awareness that the conduct violates a statute, regulation, or legal requirement.

Chur II reinforces that Nevada law requires allegations in the latter category to impose personal liability on directors for official acts.

5.4 Relation Back (NRCP 15(c)(1))

Relation back allows new or refined claims to be treated as if they were filed on the date of the original complaint, avoiding statute‑of‑limitations problems, so long as:

The amendment concerns the same “conduct, transaction, or occurrence” initially pleaded;
It does not introduce entirely different factual events; and
The opposing party had fair notice of the core factual allegations.

In Chur II, although the Commissioner added new legal labels (intentional misconduct, knowing violation of law) and specified regulatory and statutory provisions, the core factual story—how the Directors managed L&C, their use of reinsurance brokers, and L&C’s hazardous condition—remained the same. That justified relation back.

5.5 Judicial Estoppel

Judicial estoppel is designed to protect the integrity of the judicial process by preventing parties from:

Arguing one position in one phase of a case or in one case;
Prevailing on that position; and then
Taking a contradictory position later to gain an additional advantage.

Because the Commissioner’s positions regarding the Directors and the Corporate Defendants were not shown to be “totally inconsistent,” the Nevada Supreme Court declined to apply judicial estoppel at the amendment stage.

5.6 “Receiver” and Statutory Immunity

A receiver is a court‑appointed fiduciary charged with taking control of an insolvent or distressed entity’s assets, managing them, and prosecuting or defending claims on behalf of the entity and its stakeholders.

Under NRS 696B.565(1), Nevada grants the Commissioner, when acting as receiver, a statutory immunity from “civil liability” for acts, errors, or omissions in fulfilling the receiver’s duties, subject to certain limitations. At issue here was whether that immunity extends to liability for attorney fees and costs awarded under NRCP 68.

The Court did not decide that question because the Directors failed the threshold requirement of being prevailing parties after reversal of the underlying judgment.

6. Impact and Future Implications

6.1 Procedural Impact: Strengthened Commitment to Liberal Amendment

Chur II sends a clear signal to Nevada trial courts:

When a significant judicial decision or legislative development changes or clarifies the controlling law, courts should strongly favor allowing amendments so that claims are evaluated under the correct standard.
Routine concerns about added expense or time, without more, will rarely justify denying leave when the motion is promptly made in response to a change in law.
Denial of amendment in such circumstances risks reversal on appeal for abuse of discretion.

Practitioners should likewise:

Move promptly to amend pleadings when Nevada or federal precedent affecting their claims or defenses changes;
Frame their motions explicitly in terms of the “change in law” doctrine endorsed in this opinion; and
Address each NRCP 15 factor explicitly, emphasizing lack of prejudice and promptness.

6.2 Substantive Impact: Director and Officer Litigation in Nevada

On the substantive side, the opinion:

Reinforces Chur I’s strict standard for personal liability of directors and officers under NRS 78.138(7);
Confirms that:
- Administrative regulations can supply the “law” component of a “knowing violation of law” claim; and
- Receivers and other plaintiffs may build intentional‑misconduct/knowing‑violation theories around regulatory violations, provided they can plausibly allege and later prove actual knowledge and causation.
This will affect:
- Derivative and direct suits against corporate directors and officers;
- Receivership and insolvency litigation, particularly in regulated industries like insurance and financial services; and
- The drafting of complaints against directors, which must now carefully allege mental state and specific legal duties violated.
6.3 Risk Retention Groups, Insurance Receiverships, and Regulatory Enforcement

Although the opinion is procedurally focused, it also highlights:
- The importance of compliance with licensing and authority regulations in the insurance sector (e.g., NAC 694C.300, NAC 683A.530(7));
- The substantive obligations of risk retention groups not to operate in hazardous financial condition under NRS 695E.200; and
- The willingness of Nevada courts to permit receivers to pursue directors individually for alleged intentional misconduct and regulatory violations contributing to insolvency.
In future insurance receiverships, plaintiffs will likely model their pleadings on the approach approved in this opinion, alleging:
- Specific regulatory violations;
- Directors’ actual knowledge of those violations; and
- Causation connecting the violations to financial harm or insolvency.
6.4 Attorney Fees and Offers of Judgment

The decision also underscores a practical point about offers of judgment:
- Prevailing-party status is fluid; a party that wins at the trial level may lose that status if the judgment is reversed on appeal.
- Any fee or cost awards dependent on prevailing-party status are correspondingly vulnerable to being vacated.
The unresolved question—whether the Commissioner as receiver is immune from NRCP 68 fee awards under NRS 696B.565—remains an open issue for future litigation.

7. Conclusion

State, Commissioner of Insurance v. Chur solidifies two key principles in Nevada law:
1. Procedural fairness in the face of changing law – When controlling law materially shifts mid‑litigation, district courts must give significant weight to allowing amendments under NRCP 15 so claims can be litigated under the correct legal standard, absent clear bad faith, undue prejudice, or futility.
2. Clarification of director liability theory – Following Chur I, plaintiffs must allege intentional misconduct, fraud, or knowing violations of law—not just gross negligence—to hold directors personally liable, and knowing violations of properly promulgated regulations may satisfy that standard.
By reversing the denial of leave to amend and vacating the associated attorney‑fee order, the Nevada Supreme Court emphasizes that litigation should be resolved on its merits, with parties afforded a fair opportunity to recalibrate their claims when the legal landscape changes. The opinion will guide Nevada courts and litigants in managing complex corporate and receivership litigation for years to come, particularly where evolving precedent and regulatory frameworks intersect with the high bar for director and officer liability.

Liberal Amendment After Intervening Changes in Law: State, Commissioner of Insurance v. Chur and NRCP 15