United States District Court, D. Nevada
C. JONES JUDGE
FACTS AND PROCEDURAL HISTORY
case arises out of a homeowners' association foreclosure
sale. John Ring purchased real property at 820 Peachy Canyon
Circle, Unit #104, Las Vegas, Nevada, 89144 (“the
Property”), giving Evergreen Moneysource Mortgage Co.
(“Evergreen”) a $210, 123 promissory note
(“the Note”) and a deed of trust (“the
DOT”) against the Property. (See Compl. 9-10,
ECF No. 1). Dakota Condominiums Homeowners Association
(“the CHOA”) sold the Property to SFR Investments
Pool 1, LLC (“SFR”) at a non-judicial foreclosure
sale for $9, 200 on August 10, 2012. (See Id.
¶¶ 12-18). Nationstar Mortgage, LLC
(“Nationstar”) became the assignee of the DOT on
March 26, 2013. (Id. ¶ 11).
sued SFR in this Court to quiet title to the Property as to
the validity of the sale and the continuing vitality of the
DOT. SFR answered and filed a Counterclaim to quiet title in
its favor and for a permanent injunction against foreclosure
under the DOT. The parties filed cross motions for summary
judgment, each party asking the Court for defensive summary
judgment against the other's claims and for offensive
summary judgment on its own claims. The Court granted both
motions in part and denied them both in part in April 2016,
ruling that SFR was entitled to summary judgment against the
Complaint as to the Shadow Wood issue, tender of the
superpriority amount before sale, and the due process issue
under the quiet title claim, and that Nationstar was entitled
to summary judgment against the Counterclaim as to the bona
fide purchaser issue. The Court ruled that the respective
quiet title claims must be tried to a jury on the issues of
lien priority (the comparative dates of recordation of the
Declaration and the DOT), commercial unreasonableness of the
sale, whether constitutional notice of the sale was given (as
to SFR's counterclaim), and whether the loan was
FHA-insured at the time of the sale.
asked the Court to reconsider summary judgment in part,
arguing that in light of Bourne Valley, the
Court's previous ruling that Chapter 116 foreclosures did
not implicate state action must be reconsidered. The Court
granted the motion and ruled that notice remained factually
disputed. SFR asked the Court to stay the case pending
issuance of the mandate in Bourne Valley Court Tr. v.
Wells Fargo Bank, N.A., 832 F.3d 1154 (9th Cir. 2016),
anticipating that the U.S. Supreme Court might grant
certiorari in that case after the Nevada Supreme Court ruled
contrary to the Court of Appeals as to the constitutionality
of the notice scheme under Chapter 116. The Court refused to
stay the case, and the Supreme Court has since denied
Court has since ruled that because Bourne Valley
struck down the notice scheme as facially unconstitutional,
actual or reasonable notice is inapposite. See Bank of
N.Y. Mellon v. Ravenstar Invs., LLC, No. 3:17-cv-116,
2017 WL 2588088, at *3-4 (D. Nev. June 14, 2017) (Jones, J.).
The Court will therefore quiet title in favor of Plaintiff
under Bourne Valley.
is no reason to await the Nevada Supreme Court's ruling
as to whether Chapter 116 incorporated Nevada Revised
Statutes section (“NRS”) 107.090 at the relevant
time. The Nevada Supreme Court has already ruled to the
contrary. See U.S. Bank., N.A. v. SFR Invs. Pool 1,
LLC, 124 F.Supp.3d 1063, 1078-80 (D. Nev. 2015) (Jones,
J.) (examining SFR Invs. Pool 1, LLC v. U.S. Bank,
N.A., 334 P.3d 408, 411 (Nev. 2014)). And as the Court
has noted in other cases, this Court and the Court of Appeals
have both separately ruled that NRS 107.090 did not require
notice to the deed of trust holder in a Chapter 116 sale at
the relevant time. The Court of Appeals reasoned that
incorporation would render part of the opt-in statutes
superfluous. See Bourne Valley Court Tr., 832 F.3d
at 1159. This Court had previously disagreed with that
reasoning, see U.S. Bank., N.A., 124 F.Supp.3d at
1079 n.3, but it would be bound even if it disagreed with the
conclusion, which it does not. As the Court has noted in
other cases, the later amendment of Chapter 116 to require
notice in this context provides the most powerful of
implications that the statute did not previously do so.
See U.S. Bank, N.A. v. SFR Invs. Pool 1, LLC, No.
3:15-cv-241, 2016 WL 4473427, at *5 n.1 (D. Nev. Aug. 24,
2016). The Court has also noted that Defendant's
proffered interpretation would require a court to make the
nonsensical finding that a deed of trust is subordinate to
itself. See Id. at *5.
HEREBY ORDERED that summary judgment is granted in favor of
Plaintiff and against Defendant, and Plaintiff shall SUBMIT a
proposed form of judgment within fourteen (14) days.
 Although the Complaint states that
“plaintiff” bought the Property, that is
apparently a typographical error. Nationstar clearly asserts
an adverse interest in the Property as against the buyer
(SFR) based on ...