United States District Court, D. Nevada
RICHARD F. BOULWARE, II UNITED STATES DISTRICT JUDGE.
case was taken on appeal from the Bankruptcy Court on June
10, 2016. Bank of New York Mellon (“BNYM”) filed
its Opening Brief on September 12, 2016. [ECF No. 18].
K&P Homes, LLC (“K&P”), filed an
Answering Brief on September 19, 2016. [ECF No. 22]. BNYM
filed its Reply Brief on October 3, 2016. [ECF No. 23].
following factual findings are taken from the bankruptcy
court's order. On December 30, 2005, Countrywide KB Home
Loans recorded a Deed of Trust with the Clark County
recorder. The deed reflected that the debtors, Ursula Moore
and Marlon Moore, obtained a loan for the property at issue
in this case. On February 29, 2008, the debtors filed their
voluntary petition for Chapter 7 bankruptcy, and in the
petition stated they intended to surrender the property. The
debtors listed Countrywide in the schedules, but did not list
Alliante, a Homeowners' Association, in the schedules.
March 2, 2008, Countrywide was served with a notice of the
Chapter 7 bankruptcy petition. On April 14, 2008, the trustee
stated “[t]here are no scheduled assets to
administer.” On June 23, 2008, the bankruptcy court
entered the discharge order. On December 16, 2008, Alliante
recorded a notice of default and an election to sell under
the property at issue in this case, pursuant to a
homeowners' association lien. Alliante had not sought
relief from the automatic bankruptcy stay when it recorded
November 4, 2009, Alliante recorded a notice of trustee's
sale regarding the property. On January 23, 2009, the
bankruptcy court entered the final decree and closed the
case. Sometime in 2010, Alliante recorded a second notice of
trustee sale regarding the property.
February 17, 2012, Bank of America recorded an assignment of
deed of trust with the Clark County recorder. Under the
assignment, all beneficial interest in the property was
assigned to BNYM. On February 20, 2013, Alliante recorded a
notice of foreclosure sale regarding the property.
purchased the property at a foreclosure sale held March 15,
2013. On March 20, 2013, K&P recorded a foreclosure deed.
Under this deed, Alliante granted and conveyed the property
to K&P Homes.
August 8, 2014, K&P filed a quiet title action in state
court. On September 5, 2014, BNYM filed an answer and
counterclaim in the state court case. On June 17, 2015, BNYM
filed a motion for summary judgment in the state court case
and alleged that there had been a violation of the automatic
stay in bankruptcy court, by Alliante.
Bankruptcy Court Order
6, 2015, K&P filed a motion to reopen the bankruptcy
case, and for the bankruptcy court to retroactively annul the
stay order. The bankruptcy court found that, under In re
Pecan Groves of Arizona, 951 F.2d 242 (9th Cir. 1991),
BNYM lacked standing to allege the invalidity of the sale and
violation of the stay. The bankruptcy court interpreted
Pecan Grove to hold that creditors do not have
standing to appeal a trustee's unsuccessful motion, and
that BNYM lacked standing for purposes of objecting to the
motion to annul the stay. Therefore, it addressed
K&P's motion and disregarded BNYM's position on
bankruptcy court applied the 12-factor Fjeldsted test from
In re Fjeldsted, 293 B.R. 12 (9th Cir. B.A.P. 2003),
and determined that annulment of the automatic stay, prior to
June 23, 2008, was appropriate. It entered its Annulment
Order on May 3, 2016. This then rendered the 2008 ...