Presidio Adventures Development I et al v. Countrywide Financial Corporation et al

Filing 92

ORDER Granting 84 Defendants' Motion for Summary Judgment. IT IS FURTHER ORDERED that Plaintiffs' 88 Motion for Leave to file a Second Amended Complaint is Denied. Signed by Judge James C. Mahan on 7/21/2015. (Copies have been distributed pursuant to the NEF - PS)

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UNITED STATES DISTRICT COURT

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DISTRICT OF NEVADA

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PRESIDIO ADVENTURES
DEVELOPMENT I, et al.,

ORDER
Plaintiff(s),

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v.

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Case No. 2:12-CV-1369 JCM (GWF)

COUNTRYWIDE FINANCIAL
CORPORATION, et al.,

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Defendant(s).

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Presently before the court is plaintiffs Presidio Adventures
Presidio Adventures Development II

Presidio

Presidio

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; Stephen Slatton; Brian Chavez; Julie

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(Doc. #

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84). Defendants Countrywide Financial Corporation; Countrywide Bank, N.A.

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Bank ; Countrywide Home Loans, Inc.; Bank of America, N.A.

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Company, N.A.;

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response, (doc. # 85), and plaintiffs filed a reply, (doc. # 87).

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Also before the court is plaintiff

; ReconTrust

motion for leave to file a second amended complaint.

(Doc. # 88). Defendants filed a response, (doc. # 89), and plaintiffs filed a reply, (doc. # 90).
I.

Background

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The instant case arises from a mortgage dispute. Many issues that were initially the subject

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of the underlying action have been adjudicated by the court. Two issues remain in dispute: (1)

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whether defendants have been unjustly enriched and (2) whether titles to the properties in this

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action are marketable.

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James C. Mahan
U.S. District Judge

In 2008, the individual plaintiffs purchased

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at Palms Place in Las Vegas. (Doc. # 20). The individual plaintiffs

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entered into two identical mortgage agreements with Countrywide Bank for $485,485.00 each. On

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June 30, 2008, deeds of trust were recorded on unit 1 and unit 2. (Doc. # 1). On the same date, a

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second erroneous deed of trust was recorded for the mortgage on unit 2. (Id.).

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On July 1, 2008, BANA became a successor by merger of Countrywide Bank. (Doc. # 41).

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As a result, BANA assumed all liabilities of Countrywide Bank, including the deeds of trust in the

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instant dispute. (Id.). In July of 2009, the individual plaintiffs transferred the titles to unit 1 and

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unit 2 to Presidio I and Presidio II. (Doc. # 1).

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In January of 2011, the individual plaintiffs and BANA entered into a loan modification

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agreement. (Id.). The purpose of the agreement was to correct mistakes concerning the second

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erroneous deed of trust on unit 2 and create clear and marketable title. (Doc. # 1). However, the

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duplicate recordation was never corrected and there continued to be two deeds of trust recorded

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against unit 2. (Id.).

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In or around August 2011, plaintiffs faced financial difficulties. As a result, plaintiffs

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began missing payments on their mortgages. (Doc. # 88). Plaintiffs attempted to sell, surrender,

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or short sale both units. Plaintiffs allege they were unsuccessful because they did not have clear

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marketable title due to the erroneous deed of trust on unit 2. (Id.).
Plaintiffs claim that they repeatedly notified defendants of the erroneous deed of trust and

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demanded that the recordation be fixed, to not avail. (Doc. # 41). Plaintiffs allege that defendan

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failure to provide clear and marketable title prevented them from selling unit 1 and unit 2. (Doc.

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# 41).

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mortgage payments from plaintiffs, while never providing clear marketable title in return. (Doc.

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# 85).

Plaintiffs further allege that defendants unjustly accepted over $300,000 in monthly

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On March 25, 2014, the court dismissed all claims by the individual plaintiffs but granted

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plaintiffs leave to pursue an unjust enrichment claim. The court issued a new scheduling order,

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setting a deadline of December 20, 2014, to amend or add claims and parties.

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James C. Mahan
U.S. District Judge

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II.

Legal Standard
a. Leave to amend

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[to amend] when just

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Rule 15(a) and confirmed the liberal standard district courts must apply when granting such leave.

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In Foman v. Davis, 371 U.S. 178 (1962), the Court explained:

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In the absence of any apparent or declared reason such as undue delay, bad faith
or dilatory motive on the part of the movant, repeated failure to cure deficiencies
by amendments previously allowed, undue prejudice to the opposing party by virtue
of allowance of the amendment, futility of the amendment, etc. the leave sought
should, as the ru

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Id. at 182.

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good cause and by leave of the district

Fed. R. Civ. P. 16(b). See Johnson v. Mammoth

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Recreations, Inc., 975 F.2d 604, 608 (9th Cir. 1992). If the moving party demonstrates good cause

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under Rule 16(b), then it must then establish that the proposed amendment is permissible under

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the factors germane to Rule 15. Id.

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ng modification. Id. If that party

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Id.

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b. Summary judgment

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The Federal Rules of Civil Procedure provide for summary judgment when the pleadings,

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depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any,

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Celotex Corp. v. Catrett, 477 U.S. 317,

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323 24 (1986).
In determining summary judgment, a court applies a burden-

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party moving for summary judgment would bear the burden of proof at trial, it must come forward

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with evidence which would entitle it to a directed verdict if the evidence went uncontroverted at

James C. Mahan
U.S. District Judge

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trial. In such a case, the moving party has the initial burden of establishing the absence of a genuine

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issue of fact on each issue ma

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Inc., 213 F.3d 474, 480 (9th Cir. 2000) (citations omitted).

C.A.R. Transp. Brokerage Co. v. Darden Rests.,

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In contrast, when the nonmoving party bears the burden of proving the claim or defense,

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the moving party can meet its burden in two ways: (1) by presenting evidence to negate an

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that party will bear the burden of proof at trial. See Celotex Corp., 477 U.S. at 323 24. If the

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moving party fails to meet its initial burden, summary judgment must be denied and the court need

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See Adickes v. S.H. Kress & Co., 398 U.S. 144,

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159 60 (1970).

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If the moving party satisfies its initial burden, the burden then shifts to the opposing party

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to establish that a genuine issue of material fact exists. See Matsushita Elec. Indus. Co. v. Zenith

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Radio Corp., 475 U.S. 574, 586 (1986). To establish the existence of a factual dispute, the

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opposing party need not establish a material issue of fact conclusively in its favor. It is sufficient

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T.W. Elec. Serv., Inc. v. Pac. Elec. Contractors Ass’ n, 809 F.2d 626,

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631 (9th Cir. 1987).

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In other words, the nonmoving party cannot avoid summary judgment by relying solely on

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conclusory allegations that are unsupported by factual data. See Taylor v. List, 880 F.2d 1040,

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1045 (9th Cir. 1989). Instead, the opposition must go beyond the assertions and allegations of the

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pleadings and set forth specific facts by producing competent evidence that shows a genuine issue

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for trial. See Celotex Corp.

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weigh the evidence and determine the truth, but to determine whether there is a genuine issue for

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trial. See Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 249 (1986). The evidence of the

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Id. at

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255. But if the evidence of the nonmoving party is merely colorable or is not significantly

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probative, summary judgment may be granted. See id. at 249 50.

James C. Mahan
U.S. District Judge

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III.

Discussion
The court will first address plaintiffs motion for leave to amend. The court will then

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a. Leave to amend under Rule 15 and Rule 16

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Plaintiffs seek leave to amend their complaint under Rule 15 to add a claim for declaratory

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relief that titles to the properties subject to this suit are marketable. Defendants argue that Rule

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16, not Rule 15, applies because the deadline to amend has passed. Under Rule 16, plaintiffs must

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show good cause to modify the scheduling order. See Fed. R. Civ. P. 16(b).

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Johnson v. Mammoth Recreations, Inc., 975 F.2d 604, 609 (9th Cir. 1992).

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carelessness is not compatible with a finding of diligence and offers no reason for a
Id.

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. Id. at

610.

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Here, plaintiffs argue that leave to amend would cause no prejudice to this suit because no

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additional discovery is required. However, good cause focuses primarily on diligence. Plaintiffs

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fail to show that they were diligent in seeking to amend the complaint.

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Plaintiffs filed their original complaint on August 2, 2012. Plaintiffs amended their

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complaint for the first time in March 2013, and were allowed until December 20, 2014, to move

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to amend a second time. Plaintiffs did not move to amend until June of 2014, nearly six months

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after the scheduling deadline had passed. Plaintiffs provide no explanation for their delay.

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A

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b. Summary judgment
i.

Voluntary payment doctrine

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The voluntary payment doctrine is an affirmative defense that provides that one who

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makes a payment voluntarily cannot recover it on the ground that he was under no legal obligation

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to make the payment

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P.3d 1250, 1253 (2014), reh’ g denied (Mar. 23, 2015); see also Randazzo v. Harris Bank Palatine,

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N.A., 262 F.3d 663, 667 (7th Cir. 2001).

James C. Mahan
U.S. District Judge

Nevada Ass’ n Servs. v. Eighth Jud. Dist. Ct., 130 Nev. Adv. Op. 94, 338

the voluntary payment doctrine

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focuses on whether a person willingly pays a bill without protest regarding correctness or legality.
Nevada Ass’ n Servs., 338 P.3d at 1253.
Defendants argue that they are entitled to summary judgment based on the voluntary
payment doctrine. Plaintiffs counter that the voluntary payment doctrine does not apply here
because plaintiffs did not make any payments after becoming fully informed that the recordation
of the deeds and the loan modification agreement were improper.
The court finds that the voluntary payment doctrine applies. Plaintiffs were not forced to
make any payments, and they did so without protest as to their correctness or legality. Thus, the

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Id.; see also Tanita Corp.
of Am. v. Befour, Inc., No. 06 C 4459, 2009 WL 54509, at

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voluntary payment doctrine obliges a party to challenge a payment either before or at the time it
makes the payment.
For the voluntary payment doctrine to be effective, plaintiffs must have been fully
informed. See Nevada Ass’ n, Servs.,

It] is well settled that money voluntarily

paid, with full knowledge of all the facts, although no obligation to make such payment existed,
cannot be recovered back.

However, plaintiff Slatton, a member of Presidio I and Presidio II,

as well as other members of Presidio I and Presidio II, signed the loan modification agreement.
When Slatton and the other members signed, they indicated that plaintiffs had full knowledge of
the agreement, including the erroneous deed of trust recordation. Therefore, the voluntary
payment doctrine applies.
ii.

Payment in defense of property exception

If the moving party can show that voluntary payment was made, the burden shifts to the
nonmoving party to show that an exception to the voluntary payment doctrine is applicable. Id.

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Id. at 1254. One exception to the voluntary payment doctrine is payment in defense of
property. See Cobb v. Osman, 433 P.2d 259, 263 (Nev.
volunteer or stranger when he pays to save his interest

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James C. Mahan
U.S. District Judge

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Since defendants have met their burden by showing that the voluntary payment doctrine

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applies, the burden shifts to plaintiffs to show that the defense of property exception is germane

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here. Plaintiffs argue that payments they made to BANA were for the purpose of protecting and

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preserving their interest in the properties. Plaintiffs further claim that they made payments as an

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obligation to save their interests.

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Nevada Ass’ n Servs., 338 P.3d 1250 at 1256. Here, there

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create a risk of the loss of

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was no imminent or ongoing foreclosure proceeding against either unit owned by plaintiffs.

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Therefore, the payment in defense of property exception does not apply here. The

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remaining unjust

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enrichment claim. Accordingly, the court will grant defendants motion for summary judgment.

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IV.

Conclusion

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Accordingly,

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IT IS HEREBY ORDERED, ADJUDGED, AND DE

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leave to file a second amended complaint, (doc. # 88), be, and the same hereby is, DENIED.
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),

be, and the same hereby is, GRANTED.

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The clerk shall enter judgment accordingly and close the case.

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DATED July 21, 2015.

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__________________________________________
UNITED STATES DISTRICT JUDGE

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James C. Mahan
U.S. District Judge

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