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Bank of America, N.A. v. Desert Canyon Homeowners Association

United States District Court, D. Nevada

June 7, 2019

BANK OF AMERICA, N.A., Plaintiff,



         I. SUMMARY

         This case arises from the foreclosure sale of property to satisfy a homeowners' association lien. Four motions are before the Court: (1) Plaintiff Bank of America, N.A.'s motion for partial summary judgment (the “Motion”) (ECF No. 86); (2) Defendant SFR Investments Pool 1, LLC's (“SFR”) motion for summary judgment (ECF No. 89); (3) Defendant Desert Canyon Homeowners' Association's (the “HOA”) renewed motion for summary judgment (ECF No. 90); and (4) Plaintiff's motion for leave to file supplemental authority (“Supplemental Authority Motion”) (ECF No. 108).[1] Because the Court agrees with Plaintiff that Plaintiff's counsel's offer to pay the superpriority portion of the HOA's lien, combined with the HOA's agent's rejection of that offer, cured the default as to that portion of the lien, the Court will grant Plaintiff's Motion, and deny SFR and the HOA's cross-motions. Further, the Court will grant Plaintiff's Supplemental Authority Motion.


         The following facts are undisputed unless otherwise indicated.

         In August 2008, Timothy S. Goering and Adrian A. Goering (“Borrowers”) obtained a loan for $226, 395.00 (“Loan”) and executed a note (the “Note”) secured by a deed of trust (“DOT”) on the real property located at 644 Palm Wash Lane, Henderson, Nevada 89011 (“the Property”). (ECF No. 86-1 at 2-3.) Plaintiff purchased the Loan from Bayview Loan Servicing, LLC on January 18, 2017. (ECF No. 1 at 4.) Plaintiff had an assignment recorded reflecting its beneficial interest under the DOT on March 24, 2017. (ECF No. 86-2 at 2.)

         Borrowers failed to pay HOA assessments, and the HOA recorded a notice of delinquent assessment lien in September 2011, identifying the amount due to the HOA to date as $709.53.[2] (ECF No. 86-3 at 2.) The HOA recorded a notice of default and election to sell on August 9, 2012, identifying the amount due to the HOA to date as $2, 150.70. (ECF No. 86-4 at 2.)

         Plaintiff also owned the Loan around this time, as successor by merger to BAC Home Loans Servicing, LP.[3] (ECF No. 86-5 at 5; see also ECF No. 1 at 4.) On September 5, 2012, Plaintiff's counsel at the time (the law firm “Miles Bauer”) requested from ACS a calculation of the superpriority portion of the HOA's lien and offered to pay that amount.[4] (ECF No. 86-5 at 5-6.) ACS responded with a letter from Kelly Mitchell stating she would not provide a 9 month “super priority lien Statement of Account” unless Plaintiff had already foreclosed on the Property, and could provide proof to ACS Plaintiff owned the Property. (Id. at 8.) Ms. Mitchell's letter then stated ACS intended to proceed to a homeowners' association foreclosure sale unless ACS received documentation from Plaintiff proving Plaintiff intended to foreclose on the property. (Id.) Ms. Mitchell's letter concluded by offering Plaintiff the ability to re-request a statement of account through a different process for $50, or get “an actual payoff demand” from ACS for $150. (Id.) Plaintiff never responded to Ms. Mitchell's letter, and never sent ACS a check for any amount. (ECF No. 109-2 at 13.)

         On January 7, 2013, the HOA recorded a notice of sale through ACS setting the foreclosure sale for February 12, 2013. (ECF No. 86-6.) The HOA proceeded with the foreclosure sale on March 12, 2013 (the “HOA Sale”), and SFR purchased the Property at the HOA Sale for $10, 000. (ECF No. 86-7.)

         Plaintiff asserted claims for: (1) quiet title/declaratory judgment against all Defendants; (2) breach of NRS § 116.1113 against ACS and the HOA; (3) wrongful foreclosure against the HOA and ACS; and (4) injunctive relief against SFR. (ECF No. 1 at 6-15.) SFR later filed a counterclaim for quiet title and injunctive relief against Plaintiff, and substantially the same crossclaim against Bayview Loan Servicing LLC, Timothy Goering, and Adrian Goering. (ECF No. 37 at 9-18.) On the HOA's motion to dismiss, the Court dismissed Plaintiff's second and third claims against the HOA, for breach of NRS § 116.1113, and wrongful foreclosure, as time-barred. (ECF No. 58 at 4.)


         “The purpose of summary judgment is to avoid unnecessary trials when there is no dispute as to the facts before the court.” Nw. Motorcycle Ass'n v. U.S. Dep't of Agric., 18 F.3d 1468, 1471 (9th Cir. 1994). Summary judgment is appropriate when the pleadings, the discovery and disclosure materials on file, and any affidavits “show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law.” Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986). An issue is “genuine” if there is a sufficient evidentiary basis on which a reasonable fact-finder could find for the nonmoving party and a dispute is “material” if it could affect the outcome of the suit under the governing law. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). Where reasonable minds could differ on the material facts at issue, however, summary judgment is not appropriate. See Id. at 250-51. “The amount of evidence necessary to raise a genuine issue of material fact is enough ‘to require a jury or judge to resolve the parties' differing versions of the truth at trial.'” Aydin Corp. v. Loral Corp., 718 F.2d 897, 902 (9th Cir. 1983) (quoting First Nat'l Bank v. Cities Serv. Co., 391 U.S. 253, 288-89 (1968)). In evaluating a summary judgment motion, a court views all facts and draws all inferences in the light most favorable to the nonmoving party. See Kaiser Cement Corp. v. Fishbach & Moore, Inc., 793 F.2d 1100, 1103 (9th Cir. 1986).

         The moving party bears the burden of showing that there are no genuine issues of material fact. See Zoslaw v. MCA Distrib. Corp., 693 F.2d 870, 883 (9th Cir. 1982). Once the moving party satisfies Rule 56's requirements, the burden shifts to the party resisting the motion to “set forth specific facts showing that there is a genuine issue for trial.” Anderson, 477 U.S. at 256. The nonmoving party “may not rely on denials in the pleadings but must produce specific evidence, through affidavits or admissible discovery material, to show that the dispute exists, ” Bhan v. NME Hosps., Inc., 929 F.2d 1404, 1409 (9th Cir. 1991), and “must do more than simply show that there is some metaphysical doubt as to the material facts.” Orr v. Bank of Am., NT & SA, 285 F.3d 764, 783 (9th Cir. 2002) (quoting Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586 (1986)). “The mere existence of a scintilla of evidence in support of the plaintiff's position will be insufficient.” Anderson, 477 U.S. at 252.

         Further, “when parties submit cross-motions for summary judgment, ‘[e]ach motion must be considered on its own merits.'” Fair Hous. Council of Riverside Cty., Inc. v. Riverside Two, 249 F.3d 1132, 1136 (9th Cir. 2001) (citations omitted) (quoting William W. Schwarzer, et al., The Analysis and Decision of Summary Judgment Motions, 139 F.R.D. 441, 499 (Feb. 1992)). “In fulfilling its duty to review ...

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