Warren MARKOWITZ, an Individual; and Jacqueline Markowitz, an Individual, Appellants,
SAXON SPECIAL SERVICING; and Deutsche Bank National Trust Company, Respondents.
Law Office of Jacob L. Hafter & Associates and Jacob L. Hafter and Michael K. Naethe, Las Vegas, for Appellants.
McCarthy & Holthus, LLP, and Kristin A. Schuler-Hintz, Las Vegas, for Respondents.
BEFORE PICKERING, C.J., GIBBONS, HARDESTY, PARRAGUIRRE, DOUGLAS, CHERRY and SAITTA, JJ.
Under Nevada's Foreclosure Mediation Program Rules, the deed-trust beneficiary must submit an appraisal and/or a broker's price opinion prepared " no more than 60 days before the commencement date of the mediation" that provides a valuation for the home that is the subject of the mediation. Saxon Special Servicing attended the underlying mediation and provided a broker's price opinion that was 83 days old at the time of mediation. We are asked to decide whether the mediation rule requiring an appraisal or broker's price opinion that is no more than 60 days old at the time of the mediation mandates strict or substantial compliance. We conclude that because a current appraisal or broker's price opinion is intended to facilitate good-faith mediation negotiations, the rule's content-based provision governing the appraisal's age is directory rather than mandatory, and thus, substantial compliance with the 60-day provision satisfies the mediation rule. Because the broker's price opinion here contained a recent appraisal of the home's value adequate to facilitate negotiations, and the homeowners did not demonstrate that they were prejudiced bye the 23-day age differential between the price opinion provided and the rule's age provision, Saxon Special Servicing substantially complied with the foreclosure mediation rule requiring a current appraisal, and we therefore affirm the district court's order denying the petition for judicial review.
Appellants Warren and Jacqueline Markowitz obtained a home loan from Fremont Investment & Loan, for which they executed a promissory note in Fremont's favor. The note was later assigned to respondent Deutsche Bank National Trust Company and serviced on Deutsche Bank's behalf by respondent Saxon Special Services. After the Markowitzes stopped making payments to Saxon, a notice of default was recorded. The Markowitzes then elected to mediate in Nevada's Foreclosure Mediation Program (FMP).
The mediation occurred on December 28, 2010. Warren attended the mediation in person along with counsel, and Jacqueline attended by telephone. Saxon, purporting to represent Deutsche Bank, appeared through counsel. Saxon provided all of the required
documents for the mediation, including an 83-day-old broker's price opinion (BPO). During the mediation, the Markowitzes raised concerns about Saxon's authority to participate. Saxon's counsel explained that she had the authority to negotiate a loan modification. The mediator spoke by telephone with a representative of Saxon who confirmed that Saxon was the servicer of the loan. Despite this confirmation, the Markowitzes were not convinced that Saxon had authority to negotiate a loan modification, and they elected to terminate the mediation.
The mediator issued a statement indicating that the Markowitzes failed to provide certain documents for the mediation and that Saxon failed to bring a current BPO. The mediator's statement did not indicate that any party lacked authority to negotiate or failed to attend the mediation. The Markowitzes filed a petition for judicial review, which, after briefing and argument, the district court denied, concluding that the parties had negotiated in good faith with valid authority and that there was no reason to withhold the FMP certificate. This appeal followed.