United States District Court, D. Nevada
C. JONES United States District Judge
case arises out of a homeowners' association
(“HOA”) foreclosure sale. Pending before the
Court is a motion for summary judgment.
FACTS AND PROCEDURAL HISTORY
about November 1, 2005, Graham M. and Sonja J. Leonard gave
Plaintiff Bank of America, N.A. (“BOA”) a $372,
600 promissory note (“the Note”) in exchange for
proceeds in that amount to purchase real property at 15505
Legend View Ct., Reno, Nevada, 89511 (“the
Property”), as well as a first deed of trust
(“the DOT”) against the Property. (See
Compl. ¶¶ 8, 14, ECF No. 1). Defendant Legend
Trails Homeowners' Association (“the HOA”),
through its agent Defendant Alessi & Koenig, LLC
(“Alessi”), conducted an HOA foreclosure sale of
the Property, selling it to Defendant LVDG LLC Series 126
(“LVDG 126”) on August 15, 2013 for $18, 153.00.
(Id. ¶¶ 2, 15-28). On May 16, 2013,
however, BOA had tendered a check to the HOA through Alessi
for $1, 755, which equaled nine months' worth of common
assessments for the Property. (Id. ¶ 26). LVDG
126 conveyed its interest in the Property to Defendant
Thunder Properties, Inc. (“Thunder”) on July 22,
2015. (Id. ¶¶ 2, 29).
sued the HOA, Alessi, LVDG 126, and Thunder in this Court
for: (1) quiet title (the HOA, LVDG 126, and Thunder); (2)
violation of NRS section (“NRS”) 116.1113 (the
HOA and Alessi); and (3) wrongful foreclosure (the HOA and
Alessi). BOA has moved for offensive summary
SUMMARY JUDGMENT STANDARDS
must grant summary judgment when “the movant shows that
there is no genuine dispute as to any material fact and the
movant is entitled to judgment as a matter of law.”
Fed.R.Civ.P. 56(a). Material facts are those which may affect
the outcome of the case. See Anderson v. Liberty Lobby,
Inc., 477 U.S. 242, 248 (1986). A dispute as to a
material fact is genuine if there is sufficient evidence for
a reasonable jury to return a verdict for the nonmoving
party. See Id. A principal purpose of summary
judgment is “to isolate and dispose of factually
unsupported claims.” Celotex Corp. v. Catrett,
477 U.S. 317, 323-24 (1986).
determining summary judgment, a court uses a burden-shifting
scheme. The moving party must first satisfy its initial
burden. “When the party moving for summary judgment
would bear the burden of proof at trial, it must come forward
with evidence which would entitle it to a directed verdict if
the evidence went uncontroverted at trial.” C.A.R.
Transp. Brokerage Co. v. Darden Rests., Inc., 213 F.3d
474, 480 (9th Cir. 2000) (citation and internal quotation
marks omitted). In contrast, when the nonmoving party bears
the burden of proving the claim or defense, the moving party
can meet its burden in two ways: (1) by presenting evidence
to negate an essential element of the nonmoving party's
case; or (2) by demonstrating that the nonmoving party failed
to make a showing sufficient to establish an element
essential to that party's case on which that party will
bear the burden of proof at trial. See Celotex
Corp., 477 U.S. at 323-24.
moving party fails to meet its initial burden, summary
judgment must be denied and the court needn't consider
the nonmoving party's evidence. See Adickes v. S.H.
Kress & Co., 398 U.S. 144 (1970). If the moving
party meets its initial burden, the burden then shifts to the
nonmoving party to establish a genuine issue of material
fact. See Matsushita Elec. Indus. Co. v. Zenith Radio
Corp., 475 U.S. 574, 586 (1986). To establish the
existence of a factual dispute, the nonmoving party need not
establish a material issue of fact conclusively in its favor.
It is sufficient that “the claimed factual dispute be
shown to require a jury or judge to resolve the parties'
differing versions of the truth at trial.” T.W.
Elec. Serv., Inc. v. Pac. Elec. Contractors Ass'n,
809 F.2d 626, 631 (9th Cir. 1987). In other words, the
nonmoving party cannot avoid summary judgment by relying
solely on conclusory allegations unsupported by facts.
See Taylor v. List, 880 F.2d 1040, 1045 (9th Cir.
1989). Instead, the opposition must go beyond the assertions
and allegations of the pleadings and set forth specific facts
by producing competent evidence that shows a genuine issue
for trial. See Fed. R. Civ. P. 56(e); Celotex
Corp., 477 U.S. at 324.
summary judgment stage, a court's function is not to
weigh the evidence and determine the truth, but to determine
whether there is a genuine issue for trial. See
Anderson, 477 U.S. at 249. The evidence of the nonmovant
is “to be believed, and all justifiable inferences are
to be drawn in his favor.” Id. at 255. But if
the evidence of the nonmoving party is merely colorable or is
not significantly probative, summary judgment may be granted.
See Id. at 249-50. Notably, facts are only viewed in
the light most favorable to the nonmoving party where there
is a genuine dispute about those facts. Scott v.
Harris, 550 U.S. 372, 380 (2007). That is, even where
the underlying claim contains a reasonableness test, where a
party's evidence is so clearly contradicted by the record
as a whole that no reasonable jury could believe it, “a
court should not adopt that version of the facts for purposes
of ruling on a motion for summary judgment.”
Court grants offensive summary judgment to BOA for two
independent reasons. First, Chapter 116's opt-in notice
scheme is facially unconstitutional under the Due Process
Clause of the Fourteenth Amendment, Bourne Valley Court
Tr. v. Wells Fargo Bank, N.A., 832 F.3d 1154, 1160 (9th
Cir. 2016), and Defendants have adduced no evidence of
constitutionally reasonable notice of the HOA sale to BOA,
but only publication, which is constitutionally insufficient,
Mennonite Bd. of Missions v. Adams, 462 U.S. 791,
798 (1983). Second, BOA has adduced unrebutted evidence that
it tendered $1, 755 (nine months' of assessments at $195
per month) to Alessi before the sale but that Alessi
wrongfully rejected the tender. (See Ex. F, ECF No.
28-6). The superpriority piece of the HOA's lien was
therefore extinguished before the HOA sale, the HOA proceeded
on the subpriority piece of the lien, and the DOT, being
senior to the subpriority piece of the lien, survived the
sale. See, e.g., US Bank, N.A. v. SFR Invs. Pool
1, LLC, No. 3:15-cv-241, 2016 WL 4473427, at *6-8 &
nn.2-3 (D. Nev. Aug. 24, 2016) (Jones, J.). Nor are LVDG 126
or Thunder bona fide purchasers for value. See,
e.g., id. at *9-10 & nn.4-5.
BOA wishes to further pursue a declaration under Shadow
Wood Homeowners Assoc., Inc. v. N.Y. Cmty. Bancorp.,
Inc., 366 P.3d 1105 (Nev. 2016) or Levers v. Rio
King Land & Inv. Co., 560 P.2d 917 (Nev. 1977), or
wishes to pursue its claims under NRS 116.1113 or the common
law of wrongful foreclosure for the ...