United States District Court, D. Nevada
MIRANDA M. DU, UNITED STATES DISTRICT JUDGE
case arises out of a homeowner association's
(“HOA”) foreclosure and involves the notice
provisions applicable to foreclosure sales under Nevada
Revised Statutes (“NRS”) Chapter 116. Pending
before the Court are four motions: (1) Defendant Saticoy Bay
LLC Series 7612 Cruz Bay's (“Saticoy Bay”)
Motion to Dismiss (“Saticoy Bay's MTD”) (ECF
No. 13); (2) Defendant Desert Shores Community
Association's (“Desert Shores”) Motion to
Dismiss (“Desert Shores' MTD”) (ECF No. 15);
Plaintiff JPMorgan Chase Bank, N.A.'s
(“JPMorgan”) Opposition to Motion to Dismiss
First Amended Complaint and Countermotion for Summary
Judgment (“Motion for Summary Judgment”) (ECF No.
26); and (4) Saticoy Bay's Motion to Stay Case for All
Purposes (“Motion to Stay”) (ECF No. 44). The
Court has reviewed the parties' respective responses and
replies. (ECF Nos. 24, 25, 28, 30, 32, 33, 42, 43, 46, 47,
48.) The Court has also reviewed the supplemental briefs it
requested regarding the Motion to Stay. (ECF Nos.
reasons discussed below, the Motion to Stay is granted in
part, and Desert Shores' MTD, Saticoy Bay's MTD, and
JPMorgan's Motion for Summary Judgement are denied.
initiated this action on March 28, 2017. (ECF No. 1.) On May
19, 2017, Plaintiff filed its First Amended Complaint
(“FAC”). (ECF No. 7.) The following facts are
taken from the FAC unless otherwise indicated.
about November 18, 2011, Eden Konishi
(“Borrower”) took out a mortgage loan in the
amount of $192, 460.00 (“the Loan”) to purchase
real property located at 7612 Cruz Bay Court, Las Vegas,
Nevada (“the Property”). The Property is located
in a common interest community (otherwise known as an HOA).
In exchange for the Loan, a deed of trust (“DOT”)
was recorded against the Property. Plaintiff is the
beneficiary of this DOT.
became delinquent on her obligations to pay HOA assessments
for the Property. As a result, Desert Shores-the HOA-recorded
a notice of delinquent assessment lien, a notice of default
and election to sell, and a notice of sale. At the Property
foreclosure sale on November 1, 2013, Saticoy Bay purchased
its “purported interest” in the Property for $30,
100.00. (ECF No. 7 at ¶ 23.) After Saticoy Bay purchased
the Property, Plaintiff continued to make payments on behalf
of the Property, including county tax and homeowners'
insurance payments. However, Saticoy Bay maintains that it
purchased the Property without being subject to
now brings claims for declaratory judgment, quiet title, and
unjust enrichment based on a variety of constitutional
deficiencies with NRS Chapter 116. In its request for relief,
Plaintiff asks that this Court declare that its DOT
“remains a valid first-position security
interest” that still encumbers the Property or, in the
alternative, if the Court finds that Plaintiff's DOT was
extinguished by the HOA foreclosure sale, an award of damages
for all amounts JPMorgan expended to “maintain and
preserve the Property.” (ECF No. 7 at 9.)
DESERT SHORES' MTD (ECF No. 15)
Shores brings its motion to dismiss pursuant to Federal Rule
of Civil Procedure 12(b)(6), arguing that the FAC fails to
state a claim against it and that there is no justiciable
controversy between itself and Plaintiff. (ECF No. 15 at
2-3.) Plaintiff responds that because Desert Shores is a
necessary party joined under Fed.R.Civ.P. 19 and because
invalidation of the foreclosure sale will affect it,
Plaintiff may join Desert Shores without alleging any
substantive claim against it. (ECF No. 24 at 3, 5-6.) The
Court agrees with Plaintiff.
party is ‘necessary' in two circumstances: (1) when
complete relief is not possible without the absent
party's presence; or (2) when the absent party claims a
legally protected interest in the action.” United
States v. Bowen, 172 F.3d 682, 688 (9th Cir. 1999).
Here, Desert Shores is necessary under the first factor.
FAC, Plaintiff asserts that the foreclosure sale was invalid
and requests as an alternative claim for relief that the
foreclosure sale be set aside such that the foreclosure sale
is void ab initio. (ECF No. 7 at 6, 8.) In light of
this requested relief, it is not possible for the Court to
accord complete relief among the parties without Desert
Shores being a party to this action; if Desert Shores were
not a party, it would not necessarily be bound by the
Court's order. Furthermore, the Court agrees with courts
in this District who have found that a lender's request
to set aside the foreclosure sale (even when requested as an
alternative form of relief) precludes the Court from
according complete relief among the existing parties.
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