U.S. Bank, National Association vs Countryside Homeowners Association, et al

Filing 57

ORDER granting ECF No. 48 Motion for Summary Judgment. Within 14 days, Plaintiff shall submit either a proposed form of judgment or a notice of its intent to prosecute the remaining claims under NRS 116.1113 and/or the common law of wrongful foreclosure. Signed by Judge Robert C. Jones on 04/13/2017. (Copies have been distributed pursuant to the NEF - KW)

Download PDF
1 2 3 UNITED STATES DISTRICT COURT 4 DISTRICT OF NEVADA 5 6 7 8 9 10 11 ______________________________________ ) U.S. BANK, NATIONAL ASSOCIATION, ) ) ) Plaintiff, ) ) vs. ) ) COUNTRYSIDE HOMEOWNERS ) ASSOCIATION et al., ) ) Defendants. ) 2:15-cv-01463-RCJ-GWF ORDER 12 This case arises out of a homeowners’ association foreclosure sale. Pending before the 13 14 Court is a Motion for Summary Judgment (ECF No. 48). The Court grants the motion. 15 I. 16 FACTS AND PROCEDURAL HISTORY In 2005, Jayson Barangan gave Countrywide Home Loans, Inc. (“Countrywide”) a 17 promissory note for $228,800 (the “Note”) to purchase real property at 8543 Ebony Hills Way, 18 Las Vegas, Nevada, 89123 (the “Property”), secured by a deed of trust (the “DOT”) against the 19 Property. (Compl. ¶¶ 7, 12, ECF No. 1). The DOT was later assigned to Plaintiff U.S. Bank, 20 National Association (“US Bank”). (Id. ¶ 13). Barangan has defaulted with over $228,580.16 21 due on the Note, and US Bank intends to foreclose the DOT against the Property. (Id. ¶¶ 14–16). 22 23 Defendant Countryside Homeowners’ Association (“the HOA”) has completed its own foreclosure sale, however. (See id. ¶¶ 2, 17–27). The HOA caused its agent Nevada Association 24 1 of 5 1 Services (“NAS”), to record a notice of delinquent assessment lien (the “NDAL”) in 2010 2 indicating that $738 was due, which amount included late fees, collection fees, and interest 3 totaling $554. (Id. ¶ 17). The HOA later caused NAS to record a notice of default and election to 4 sell (the “NOD”), indicating that $1,773 was due, without specifying what amount was due for 5 assessment fees versus interest, collection costs, etc., and without specifying the superpriority 6 amount of the HOA’s lien. (Id. ¶ 18). The HOA later caused NAS to record a notice of sale (the 7 “NOS”), scheduling a sale for June 24, 2011 and indicating that $3,116.42 was due, without 8 specifying what amount was due for assessment fees versus interest, collection costs, etc., and 9 without specifying the superpriority amount of the HOA’s lien. (Id. ¶ 19). On January 6, 2012, 10 the HOA sold the Property to itself for $5,259.27, less than 3% of the outstanding principal 11 balance on the Note. (Id. ¶¶ 25–26). Defendant KK Real Estate Investment Fund, LLC (“KK”) 12 obtained the Property from the HOA via quitclaim deed on May 7, 2013. (Id. ¶¶ 3, 27). 13 US Bank sued the HOA and KK in this Court for: (1) quiet title based on, inter alia, 14 violations of due process and commercial unreasonableness; (2) violation of Nevada Revised 15 Statutes section (“NRS”) 116.1113; and (3) common law wrongful foreclosure, asking the Court 16 in the alternative to set aside the sale or to declare that it did not extinguish the DOT. 1 KK filed 17 counterclaims for quiet title and cancellation of instruments. The HOA moved to dismiss, and 18 the Court denied the motion, ruling: (1) although Barangan might be entitled to intervene if he 19 were to so move under Rule 24, he was not a necessary party under Rule 19; (2) the affirmative 20 defense of non-exhaustion under NRS 38.310 did not appear on the face of the Complaint; and 21 (3) noncompliance with Chapter 116 and bad faith with respect to the Covenants, Conditions, 22 23 24 1 The fourth claim for injunctive relief is not a separate cause of action but a prayer for relief, and no motion for preliminary injunctive relief is pending. 2 of 5 1 and Restrictions (“CC&R”) had been sufficiently alleged. The HOA moved for defensive 2 summary judgment. The Court denied the motion. US Bank has now moved for offensive 3 summary judgment against the HOA and KK. 4 II. 5 SUMMARY JUDGMENT STANDARDS A court must grant summary judgment when “the movant shows that there is no genuine 6 dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Fed. R. 7 Civ. P. 56(a). Material facts are those which may affect the outcome of the case. See Anderson 8 v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). A dispute as to a material fact is genuine if 9 there is sufficient evidence for a reasonable jury to return a verdict for the nonmoving party. See 10 id. A principal purpose of summary judgment is “to isolate and dispose of factually unsupported 11 claims.” Celotex Corp. v. Catrett, 477 U.S. 317, 323–24 (1986). 12 In determining summary judgment, a court uses a burden-shifting scheme. The moving 13 party must first satisfy its initial burden. “When the party moving for summary judgment would 14 bear the burden of proof at trial, it must come forward with evidence which would entitle it to a 15 directed verdict if the evidence went uncontroverted at trial.” C.A.R. Transp. Brokerage Co. v. 16 Darden Rests., Inc., 213 F.3d 474, 480 (9th Cir. 2000) (citation and internal quotation marks 17 omitted). In contrast, when the nonmoving party bears the burden of proving the claim or 18 defense, the moving party can meet its burden in two ways: (1) by presenting evidence to negate 19 an essential element of the nonmoving party’s case; or (2) by demonstrating that the nonmoving 20 party failed to make a showing sufficient to establish an element essential to that party’s case on 21 which that party will bear the burden of proof at trial. See Celotex Corp., 477 U.S. at 323–24. 22 If the moving party fails to meet its initial burden, summary judgment must be denied and 23 the court needn’t consider the nonmoving party’s evidence. See Adickes v. S.H. Kress & Co., 398 24 3 of 5 1 U.S. 144 (1970). If the moving party meets its initial burden, the burden then shifts to the 2 nonmoving party to establish a genuine issue of material fact. See Matsushita Elec. Indus. Co. v. 3 Zenith Radio Corp., 475 U.S. 574, 586 (1986). To establish the existence of a factual dispute, 4 the nonmoving party need not establish a material issue of fact conclusively in its favor. It is 5 sufficient that “the claimed factual dispute be shown to require a jury or judge to resolve the 6 parties’ differing versions of the truth at trial.” T.W. Elec. Serv., Inc. v. Pac. Elec. Contractors 7 Ass’n, 809 F.2d 626, 631 (9th Cir. 1987). In other words, the nonmoving party cannot avoid 8 summary judgment by relying solely on conclusory allegations unsupported by facts. See Taylor 9 v. List, 880 F.2d 1040, 1045 (9th Cir. 1989). Instead, the opposition must go beyond the 10 assertions and allegations of the pleadings and set forth specific facts by producing competent 11 evidence that shows a genuine issue for trial. See Fed. R. Civ. P. 56(e); Celotex Corp., 477 U.S. 12 at 324. 13 At the summary judgment stage, a court’s function is not to weigh the evidence and 14 determine the truth, but to determine whether there is a genuine issue for trial. See Anderson, 477 15 U.S. at 249. The evidence of the nonmovant is “to be believed, and all justifiable inferences are 16 to be drawn in his favor.” Id. at 255. But if the evidence of the nonmoving party is merely 17 colorable or is not significantly probative, summary judgment may be granted. See id. at 249–50. 18 Notably, facts are only viewed in the light most favorable to the nonmoving party where there is 19 a genuine dispute about those facts. Scott v. Harris, 550 U.S. 372, 380 (2007). That is, even 20 where the underlying claim contains a reasonableness test, where a party’s evidence is so clearly 21 contradicted by the record as a whole that no reasonable jury could believe it, “a court should not 22 adopt that version of the facts for purposes of ruling on a motion for summary judgment.” Id. 23 /// 24 4 of 5 1 III. ANALYSIS 2 The Court grants offensive summary judgment to US Bank based on the Court of 3 Appeals’ intervening decision holding that Chapter 116’s opt-in notice scheme is facially 4 unconstitutional under the Due Process Clause of the Fourteenth Amendment. See Bourne Valley 5 Court Tr. v. Wells Fargo Bank, N.A., 832 F.3d 1154, 1160 (9th Cir. 2016). The Court of Appeals 6 has denied a motion to rehear the case en banc. Defendants provide no evidence of actual notice 7 in this case. KK’s counterclaims for quiet title and cancellation of US Bank’s deed of trust 8 necessarily fail given US Bank’s victory on its quiet title claim. Unless US Bank wishes to 9 further pursue its claims under NRS 116.1113 or the common law of wrongful foreclosure for 10 the purposes of obtaining damages, there appears to be nothing left to determine in this case. CONCLUSION 11 12 IT IS HEREBY ORDERED that the Motion for Summary Judgment (ECF No. 48) is 13 GRANTED. Within fourteen (14) days, Plaintiff shall submit either a proposed form of 14 judgment or a notice of its intent to prosecute the remaining claims under NRS 116.1113 and/or 15 the common law of wrongful foreclosure. 16 17 IT IS SO ORDERED. DATED: 8th 13th day of April, 2016. Dated thisThis day of December, 2017. 18 19 20 _____________________________________ ROBERT C. JONES United States District Judge 21 22 23 24 5 of 5

Disclaimer: Justia Dockets & Filings provides public litigation records from the federal appellate and district courts. These filings and docket sheets should not be considered findings of fact or liability, nor do they necessarily reflect the view of Justia.

Why Is My Information Online?