United States District Court, D. Nevada
BANK OF AMERICA, N.A., SUCCESSOR BY MERGER TO BAC HOME LOANS SERVICING, LP, FKA COUNTRYWIDE HOME LOANS SERVICING, LP, Plaintiff,
BOULDER CREEK HOMEOWNERS ASSOCIATION, et al., Defendants,
M. Navarro, Chief Judge
before the Court is the Motion for Summary judgment, (ECF No.
55), filed by Plaintiff Bank of America, N.A.
(“Plaintiff”). Defendants SFR Investments Pool 1,
LLC (“SFR”) and Boulder Creek Homeowners
Association (“HOA”) filed Responses, (ECF Nos.
57, 58), and Plaintiff filed a Reply, (ECF No. 61). Also
before the Court is SFR's Motion for Summary Judgment,
(ECF No. 54). Plaintiff filed a Response, (ECF No. 56), and
SFR filed a Reply, (ECF No. 62). For the reasons stated
herein, Plaintiff's Motion for Summary Judgment is
case arises from the non-judicial foreclosure on real
property located at 964 San Carlos Creek Lane, Henderson,
Nevada 89002 (the “Property”). (See Deed
of Trust, Ex. A to Pl.'s MSJ, ECF No. 55-1). On or about
September 15, 2009, Petelo Vake and Alisi Vake
(“Borrowers”) refinanced the Property with a loan
in the amount of $290, 515.00, secured by a dead of trust
(the “DOT”). (Id.). Plaintiff gained
beneficial interest in the DOT through an assignment recorded
on July 13, 2011. (See Assignment, Ex. C to
Pl.'s MSJ, ECF No. 55-3); (Merger, Ex. D to Pl.'s
MSJ, ECF No. 55-4). Upon Borrowers' failure to stay
current on their payment obligations, Nevada Association
Services (“NAS”), on behalf of HOA, initiated
foreclosure proceedings by recording a notice of delinquent
assessment lien and a subsequent notice of default and
election to sell. (See Notice of Delinquent
Assessment Lien, Ex. J to Pl.'s MSJ, ECF No. 55-10).
22, 2014, law firm Miles, Bauer, Bergstrom & Winters LLP
(“Miles Bauer”), on behalf of Plaintiff, sent a
letter to NAS requesting the amount of HOA's
superpriority lien. (See Request for Accounting
¶ 6, Ex. 1 to Miles Aff., ECF No. 55-12). NAS responded
with a ledger detailing the amount of HOA's lien.
(See Statement of Account, Ex. 2 to Miles Aff.).
Miles Bauer, on behalf of BANA, subsequently delivered a
check to NAS for $315.00 based on the provided ledger,
purportedly representing nine months' worth of HOA
assessments. (See Tender Letter, Ex. 3 to Miles
the alleged tender, NAS proceeded with the foreclosure by
recording a notice of foreclosure sale and subsequently
foreclosing on the Property. (See Foreclosure Deed,
Ex. M to Pl.'s MSJ, ECF No. 69-13). On July 29, 2014, SFR
recorded a foreclosure deed, stating that it purchased the
Property for $36, 000. (Id.).
filed the instant Complaint on March 15, 2016, asserting the
following causes of action arising from the foreclosure and
subsequent sale of the Property: (1) quiet title; (2) breach
of NRS 116.1113; (3) wrongful foreclosure; and (4) injunctive
relief. (See Compl. ¶¶ 32-85, ECF No. 1).
Federal Rules of Civil Procedure provide for summary
adjudication 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
judgment as a matter of law.” Fed.R.Civ.P. 56(a).
Material facts are those that may affect the outcome of the
case. 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. Id.
“Summary judgment is inappropriate if reasonable
jurors, drawing all inferences in favor of the nonmoving
party, could return a verdict in the nonmoving party's
favor.” Diaz v. Eagle Produce Ltd. P'ship,
521 F.3d 1201, 1207 (9th Cir. 2008) (citing United States
v. Shumway, 199 F.3d 1093, 1103-04 (9th Cir. 1999)). 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
determining summary judgment, a court applies a
burden-shifting analysis. “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). 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.
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. Adickes v. S.H. Kress &
Co., 398 U.S. 144, 159-60 (1970).
moving party satisfies its initial burden, the burden then
shifts to the opposing party to establish that a genuine
issue of material fact exists. 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. 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.
Celotex Corp., 477 U.S. at 324.
summary judgment, a court's function is not to weigh the
evidence and determine the truth; it is to determine whether
there is a genuine issue for trial. 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.
Id. at 249-50.
moves for summary judgment on its quiet title and declaratory
relief claims, asserting that Bourne Valley Court Tr. v.
Wells Fargo Bank, NA, 832 F.3d 1154 (9th Cir. 2016),
cert. denied, 137 S.Ct. 2296, 198 L.Ed.2d 726
(2017), compels the Court to hold that the HOA foreclosure
sale did not extinguish Plaintiff's DOT. (Pl.'s MSJ
9:11-14:6, ECF No. 55). Plaintiff also argues that summary
judgment is warranted because Plaintiff properly tendered the
superpriority HOA lien prior to the foreclosure sale, thus
eliminating the superpriority status of the HOA's lien.
(Id. 6:10-9:10). Additionally, Plaintiff argues that
NRS 116 is preempted because the loan is FHA insured.
conversely seeks summary judgment on the basis that
Bourne Valley is not controlling authority, and
Plaintiff is otherwise not entitled to an equitable remedy.
(SFR's MSJ 6:20-12:25, ECF No. 54). SFR also opposes
Plaintiff's Motion by arguing, inter alia, that
Plaintiff's purported tender did not satisfy HOA's
superpriority lien, Plaintiff's tender contained
impermissible conditions rendering it invalid, Plaintiff
lacks standing, and preemption does not apply. (See
SFR's Resp. 4:23-30:17, ECF No. 58). The Court's
discussion below first addresses the constitutionality of the
Constitutionality of the Foreclosure
Bourne Valley, the Ninth Circuit held that NRS
116.3116's notice provisions violated lenders' due
process rights because the scheme “shifted the burden
of ensuring adequate notice from the foreclosing
homeowners' association to a mortgage lender.”
Bourne Valley, 832 F.3d at 1159. The Ninth Circuit,
interpreting Nevada law, declined to embrace the
appellant's argument that NRS 107.090, read into NRS
116.31168(1), mandates that HOAs provide notice to lenders
even absent a request. Id. Accordingly, the absence
of mandatory notice provisions rendered the statutory scheme
facially unconstitutional. Id. at 1158-60.
Valley's construction of Nevada law is “only
binding in the absence of any subsequent indication from the
[Nevada] courts that [the Ninth Circuit's] interpretation
was incorrect.” Owen v. United States, 713
F.2d 1461, 1464 (9th Cir. 1983). “[W]here the reasoning
or theory of . . . prior circuit authority is clearly
irreconcilable with the reasoning or theory of intervening
higher authority, [a court] should consider itself bound by
the later controlling authority. . . .” Miller v.
Gammie, 335 F.3d 889, 892-893 (9th Cir. 2003).
“[A] [s]tate's highest court is the final judicial
arbiter of the meaning of state statutes.” Sass v.
California Bd. of Prison Terms, 461 F.3d 1123, 1129 (9th
Cir. 2006) (citing Gurley v. Rhoden, 421 U.S. 200,