United States District Court, D. Nevada
U.S. BANK, N.A., AS TRUSTEE FOR THE BENEFIT OF HARBORVIEW 2005-16, Plaintiff,
DESERT SHORES COMMUNITY ASSOCIATION, et al., Defendants.
J. Dawson United States District Judge
the Court is plaintiff U.S. Bank's second motion for
partial summary judgment (#100). Defendants MRT Assets, LLC
(#103) and Desert Shores Community Association (#104)
responded, and U.S. Bank replied (#106).
a dispute over who holds superior title in a residential
property located at 3001 Treasure Island Rd., Las Vegas, NV
89128. The home is part of the Desert Shores Community
Association and is subject to certain covenants, conditions,
and restrictions (“CC&Rs”). The former owner
of the property defaulted on his association and mortgage
obligations, which prompted Desert Shores to foreclose on the
property. U.S. Bank tried to halt the foreclosure by
tendering payment for the superpriority portion of Desert
Shore's lien, but the association refused the payment. It
then sold the property to RAM, LLC at a trustee sale, who
later conveyed the property to MRT Assets.
now asks the Court to declare that its deed of trust survived
Desert Shores' foreclosure because the bank tried to cure
the superpriority lien before the trustee sale. If true, U.S.
Bank's holds the first deed of trust, and MRT Assets
purchased the property subject to the bank's interest.
MRT Assets has counterclaimed for quiet title and a
declaration that U.S. Bank's tender did not save the
bank's interest from extinguishment. U.S. Bank is correct
that its tender cured the superpriority portion of Desert
Shores' lien. As a result, the bank's deed of trust
survived foreclosure, and MRT Assets took the property
subject to U.S. Bank's interest. The Court therefore
grants U.S. Bank's motion for summary judgment.
owner and non-party, Hagob Palikyan purchased the home at
3001 Treasure Island Rd. in 2005. Pl.'s Mot. Summ. J. Ex.
A 2, ECF No. 100. Countrywide Home Loans financed the
purchase and secured the loan with a deed of trust against
the property. Id. The deed of trust was assigned to
U.S. Bank in 2011. Id. Ex. B. Palikyan eventually
fell behind on his mortgage and association assessments,
which prompted Desert Shores to begin foreclosure
proceedings. Id. Ex. C. Desert Shores-through Nevada
Association Services-recorded a notice of delinquent
assessment lien in June of 2012. Id. When Palikyan
failed to cure the default, Nevada Association Services
recorded a notice of default and election to sell.
Id. Ex. D. Palikyan again failed to cure the
default, and Nevada Association Services sold the property to
RAM, LLC at a trustee sale for $10, 100.00. Id. Ex.
J. RAM then conveyed the property to MRT Assets by quitclaim
deed. Id. Ex. K.
Bank tried to cure the superpriority portion of Desert
Shores' lien before RAM, LLC purchased the property. The
bank's prior servicer, Bank of America, retained Miles,
Bauer Bergstrom & Winters to work with Desert Shores to
calculate and satisfy the outstanding delinquency.
Id. Ex. E. Miles Bauer contacted Nevada Association
Services in writing seeking the superpriority portion of the
association's delinquency. Id. Nevada
Association Services did not respond. Id. Without
the association's help, the bank was forced to calculate
the outstanding balance on its own. To do so, the bank
consulted a ledger of fees from a different property in the
Desert Shores Community Association. Id. It then
remitted payment to Nevada Association Services for
$977.27-nine months' assessments plus late fees, and
collection costs. Id. Nevada Association Services
rejected the payment and returned the check to Miles Bauer.
Bank then brought this case to quiet title in the property.
Compl., ECF No. 1. Desert Shores moved to dismiss because the
parties had not yet mediated the foreclosure under NRS §
38.310. Def.'s Mot. to Dismiss, ECF No. 37. The Court
granted the motion with leave to amend following the
mediation. Order on Mot. to Dismiss, ECF No. 44. In the
interim, the Court stayed the case pending the final
determinations in Bourne Valley Ct. Tr. v. Wells Fargo
Bank, 832 F.3d 1154 (9th Cir. 2016) and Saticoy Bay
v. Wells Fargo Bank, 388 P.3d 970 (Nev. 2017). Order to
Stay 1, ECF No. 78. The Court has since lifted the stay, and
U.S. Bank has amended its complaint. First Am. Compl., ECF
No. 90. The parties completed discovery and filed dispositive
motions. Since then, U.S. Bank voluntarily dismissed RAM,
LLC. Notice Vol. Dismissal, ECF No. 110. That leaves Desert
Shores, MRT Assets, and Nevada Association
Services as defendants.
purpose of summary judgment is to avoid unnecessary trials by
disposing of factually unsupported claims or defenses.
Celotex Corp. v. Catrett, 477 U.S. 317, 323-24
(1986); Northwest Motorcycle Ass'n v. U.S. Dept. of
Agriculture, 18 F.3d 1468, 1471 (9th Cir. 1994). It is
available only where the absence of material fact allows the
Court to rule as a matter of law. Fed.R.Civ.P. 56(a);
Celotex, 477 U.S. at 322. Rule 56 outlines a burden
shifting approach to summary judgment. First, the moving
party must demonstrate the absence of a genuine issue of
material fact. The burden then shifts to the nonmoving party
to produce specific evidence of a genuine factual dispute for
trial. Matsushita Elec. Indus. Co. v. Zenith Radio
Corp., 475 U.S. 574, 587 (1986). A genuine issue of fact
exists where the evidence could allow “a reasonable
jury [to] return a verdict for the nonmoving party.”
Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248
(1986). The Court views the evidence and draws all available
inferences in the light most favorable to the nonmoving
party. Kaiser Cement Corp. v. Fischbach & Moore,
Inc., 793 F.2d 1100, 1103 (9th Cir. 1986). Yet, to
survive summary judgment, the nonmoving party must show more
than “some metaphysical doubt as to the material
facts.” Matsushita, 475 U.S. at 586.
Bank moves for summary judgment on its quiet title and
declaratory relief claim against Desert Shores, MRT Assets,
and Nevada Association Services. It makes three arguments in
support: (1) that the bank's attempt to satisfy Desert
Shores' superpriority lien before foreclosure constituted
valid tender and preserved its deed of trust; (2) that Desert
Shores foreclosed under an unconstitutional version of NRS
§ 116.3116 thereby preserving U.S. Bank's interest
in the property; and (3) that the foreclosure is void because
the foreclosure sale was commercially unreasonable. See
generally Pl.'s Mot. Summ. J., ECF No. 100. U.S.
Bank is correct ...