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Bank of New York Mellon v. Sierra Ranch Homeowners Association

United States District Court, D. Nevada

July 26, 2017



         Presently before the court is plaintiff Bank of New York Mellon's (“BNYM”) motion for summary judgment. (ECF No. 70). Defendants Sierra Ranch Homeowners Association (“Sierra Ranch”) and SFR Investments Pool 1, LLC (“SFR”) filed responses (ECF Nos. 77, 80), to which BNYM replied (ECF Nos. 85, 86).

         Also before the court is defendant Sierra Ranch's motion for summary judgment. (ECF No. 81). Plaintiff BNYM filed a response (ECF No. 88), to which Sierra Ranch replied (ECF No. 96).[1]

         Also before the court is defendant SFR's motion for summary judgment. (ECF No. 82). Plaintiff BNYM filed a response (ECF No. 87), to which SFR replied (ECF No. 93).

         Also before the court is defendant SFR's motion to certify a question of law to the Nevada Supreme Court (ECF No. 91), which defendant Sierra Ranch joined (ECF No. 97). Plaintiff BNYM filed a response (ECF No. 98), to which SFR and Sierra Ranch replied (ECF No. 99).

         I. Facts

         The present case involves a dispute over real property located at 308 Iron Summit Avenue, N. Las Vegas, Nevada (the “property”). (ECF No. 1 at 3). Kari Krejci (the “borrower”) purchased the property on May 2, 2007. (Id.). The borrower financed the purchase with a $262, 750.00 loan that was secured by a deed of trust recorded on May 4, 2011. (Id.).

         On May 19, 2011, the deed of trust was assigned to BNYM, via an assignment of the same. (Id.).

         On August 15, 2011, Sierra Ranch, through its agent, recorded a notice of delinquent assessment lien. (Id.). The notice asserted that the borrower owed Sierra Ranch $2, 184.06 in fees. (Id.).

         On November 15, 2011, Sierra Ranch, through its agent, recorded a notice of default and election to sell to satisfy the delinquent assessment lien. (Id. at 5). The notice stated that the borrower owed Sierra Ranch $3, 531.69 to satisfy the outstanding balance of association fees on the property. (Id.).

         On October 2, 2012, Sierra Ranch recorded a notice of trustee's sale through its agent. (Id.). The notice asserted that the borrower owed Sierra Ranch $6, 315.69 in fees. (Id.). The trustee's sale would occur on December 6, 2012. (Id.).

         On December 12, 2013, Sierra Ranch conducted the trustee's sale, and SFR was the highest bidder, purchasing the property for $14, 000.00. (ECF No. 37 at 5). The foreclosure deed was recorded on December 23, 2013. (ECF No. 1 at 6).

         BNYM filed a complaint on October 6, 2015, asserting five (5) claims against Sierra Ranch and SFR: (1) quiet title/declaratory judgment; (2) injunctive relief against SFR; (3) breach of Nevada Revised Statute (“NRS”) 116.1113 against Sierra Ranch; (4) wrongful foreclosure against Sierra Ranch; and (5) deceptive trade practices against Sierra Ranch. (ECF No. 1).

         On May 16, 2015, SFR filed an answer and counterclaim asserting three claims for relief against BNYM and the borrower: (1) declaratory relief/quiet title; (2) preliminary and permanent injunction; and (3) slander of title. (ECF No. 37).

         Sierra Ranch and SFR filed motions to dismiss BNYM's complaint. (ECF Nos. 10, 22). On July 25, 2016, the court denied both motions to dismiss. (ECF No. 60).

         In the instant motions, BNYM, Sierra Ranch, and SFR move for summary judgment (ECF Nos. 70, 81, 82), and SFR moves to certify a question of law to the Nevada Supreme Court (ECF No. 91).

         II. Legal Standards

         A. Motion for summary judgment

         The Federal Rules of Civil Procedure allow summary judgment when the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that “there is no genuine dispute as to any material fact and the movant is entitled to a judgment as a matter of law.” Fed.R.Civ.P. 56(a). 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).

         For purposes of summary judgment, disputed factual issues should be construed in favor of the non-moving party. Lujan v. Nat'l Wildlife Fed., 497 U.S. 871, 888 (1990). However, to be entitled to a denial of summary judgment, the nonmoving party must “set forth specific facts showing that there is a genuine issue for trial.” Id.

         In determining summary judgment, a court applies a burden-shifting analysis. 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. In such a case, the moving party has the initial burden of establishing the absence of a genuine issue of fact on each issue material to its case.” C.A.R. Transp. Brokerage Co. v. Darden Rests., Inc., 213 F.3d 474, 480 (9th Cir. 2000) (citations omitted).

         By 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 non-moving party's case; or (2) by demonstrating that the non-moving 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. If the moving party fails to meet its initial burden, summary judgment must be denied and the court need not consider the nonmoving party's evidence. See Adickes v. S.H. Kress & Co., 398 U.S. 144, 159- 60 (1970).

         If the moving party satisfies its initial burden, the burden then shifts to the opposing party to establish that a genuine issue of material fact exists. See Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586 (1986). To establish the existence of a factual dispute, the opposing 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 that are unsupported by factual data. 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 Celotex, 477 U.S. at 324.

         At summary judgment, 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 v. Liberty Lobby, Inc., 477 U.S. 242, 249 (1986). Nonmovant's evidence 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. . . . . . .

         B. Certify question of law to the Nevada Supreme Court

         The Nevada Rules of Appellate Procedure provide that the Supreme Court of Nevada has the power to answer “questions of [state] law . . . which may be determinative of the cause then pending in the certifying court and as to which it appears to the certifying court there is no controlling precedent in the decisions of the Supreme Court of [Nevada].” Nev. R. App. P. 5(a).

         The Nevada Supreme Court “may answer questions of law certified [] by a federal court when (1) [the] answers to the certified questions may be determinative of part of the federal case, (2) there is no clearly controlling Nevada precedent, and (3) the answers to the certified questions will help settle important questions of law. See, e.g., Hartford Fire Ins. Co. v. Tr. of Const. Indus., 208 P.3d 884, 888 (Nev. 2009).

         Where the question does not impact the merits of a claim pending before the certifying court, the question should not be certified to the Supreme Court. See Nev. R. App. P. 5(a) (requiring that certified question be “determinative”); see also Volvo Cars of N. Am., Inc. v. Ricci, 137 P.2d 1161, 1164 (Nev. 2006) (declining to answer certified questions where “answers to the questions posed [] would not ‘be determinative' of any part of the case”). “The certification procedure is reserved for state law questions that present significant issues, including those with important public policy ramifications, and that have not yet been resolved by the state courts.” Kremen v. Cohen, 325 F.3d 1035, 1037 (9th Cir. 2003).

         Federal courts have discretion to certify questions of state law. Lehman Bros. v. Schein, 416 U.S. 386, 391 (1974). “Resort to certification is not mandatory where state law is unclear on a particular issue.” Carolina Cas. Ins. Co. v. McGhan, 572 F.Supp.2d 1222, 1225 (D. Nev. 2008) (citing Lehman Bros., 416 U.S. at 390-91). Generally, “[w]hen a decision turns on applicable state law and the state's highest court has not adjudicated the issue, a federal court must make a reasonable determination of the result the highest state court would reach if it were deciding the case.” Aetna Cas. & Sur. Co. v. Sheft, 989 F.2d 1105, 1108 (9th Cir. 1993).

         Further, a federal court may decline to certify a question where controlling precedent is available for guidance. Slayman v. FedEx Ground Package Sys., Inc., 765 F.3d 1033, 1041 (9th Cir. 2014); see also Kehoe v. Aurora Loan Servs., LLC, No. 3:10-cv-256-RCJ-RAM; 2010 WL 4286331, at *11 (D. Nev. Oct. 20, 2010) (declining to certify question to Nevada Supreme Court where statutory language was sufficiently clear for the court to apply).

         Finally, a party must show “particularly compelling reasons” for certification when that party first requests it after losing on an issue. Complaint of McLinn, 744 F.2d 677, 681 (9th Cir. 1984) (“Ordinarily such a movant should not be allowed a second chance at victory when, as here, the district court employed a reasonable interpretation of state law.”).

         III. Discussion

         A. Motions for summary judgment [2] (ECF Nos. 70, 81, 82)

         1. Preliminary considerations

         As an initial matter, the court dismisses, without prejudice, claims two (2) through five (5) of BNYM's complaint (ECF No. 1), and claims two (2) and three (3) of SFR's answer, counterclaim, and crossclaim (ECF No. 37) for the following reasons.

         i. Injunctive relief

         BNYM's claim for injunctive relief (claim 2) and SFR's preliminary and permanent injunction claim (claim 2) are dismissed without prejudice because the court follows the well-settled rule that a claim for injunctive relief standing alone is not a cause of action. See, e.g., In re Wal-Mart Wage & Hour Emp't Practices Litig., 490 F.Supp.2d 1091, 1130 (D. Nev. 2007); Tillman v. Quality Loan Serv. Corp., No. 2:12-CV-346 JCM RJJ, 2012 WL 1279939, at *3 (D. Nev. Apr. 13, 2012) (finding that “injunctive relief is a remedy, not an independent cause of action”); Jensen v. Quality Loan Serv. Corp., 702 F.Supp.2d 1183, 1201 (E.D. Cal. 2010) (“A request for injunctive relief by itself does not state a cause of action.”). . . . . . .

         ii. Administrative remedies

         Likewise, BNYM's third claim for breach of NRS 116.1113 against Sierra Ranch and its fourth claim for wrongful foreclosure against Sierra Ranch, and SFR's third claim for slander of title against BNYM are dismissed without prejudice for failure to mediate pursuant to NRS 38.330. See, e.g., Nev. Rev. Stat. § 38.330(1); McKnight Family, L.L.P. v. Adept Mgmt., 310 P.3d 555, 559 (Nev. 2013) (holding that slander of title claims are subject to NRS 38.310 and must be submitted to mediation prior to being ...

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