JEFFREY BENKO, A NEVADA RESIDENT; CAMILO MARTINEZ, A NEVADA RESIDENT; ANA MARTINEZ, A NEVADA RESIDENT; FRANK SCINTA, A NEVADA RESIDENT; JACQUELINE SCINTA, A NEVADA RESIDENT; SUSAN HJORTH, A NEVADA RESIDENT; RAYMOND SANSOTA, AN OHIO RESIDENT; FRANCINE SANSOTA, AN OHIO RESIDENT; SANDRA KUHN, A NEVADA RESIDENT; JESUS GOMEZ, A NEVADA RESIDENT; SILVIA GOMEZ, A NEVADA RESIDENT; DONNA HERRERA, A NEVADA RESIDENT; JESSE HENNIGAN, A NEVADA RESIDENT; SUSAN KALLEN, A NEVADA RESIDENT; ROBERT MANDARICH, A NEVADA RESIDENT; JAMES NICO, A NEVADA RESIDENT; PATRICIA TAGLIAMONTE, A NEVADA RESIDENT; AND BIJAN LAGHAEI, Appellants,
QUALITY LOAN SERVICE CORPORATION, A CALIFORNIA CORPORATION; MTC FINANCIAL INC., D/B/A TRUSTEE CORPS, A CALIFORNIA CORPORATION; MERIDIAN FORECLOSURE SERVICE, A CALIFORNIA AND NEVADA CORPORATION, D/B/A MTDS, INC., D/B/A MERIDIAN TRUST DEED SERVICE; NATIONAL DEFAULT SERVICING CORPORATION, AN ARIZONA CORPORATION; AND CALIFORNIA RECONVEYANCE COMPANY, A CALIFORNIA CORPORATION, Respondents.
from a district court order dismissing the case for failure
to state a claim. Eighth Judicial District Court, Clark
County; William D. Kephart, Judge.
Offices of Nicholas A. Boylan, APC, and Nicholas A. Boylan,
San Diego, California, for Appellants.
Cave Leighton Paisner LLP and Lawrence G. Scarborough,
Jessica R. Maziarz, and Kathryn E. Bettini, Phoenix, Arizona;
Smith Larsen & Wixom and Kent F. Larsen and Katie M.
Weber, Las Vegas, for Respondent California Reconveyance
Kolesar & Leatham, Chtd., and Michael R. Brooks, Las
Vegas; Burke, Williams & Sorensen, LLP, and Richard J.
Reynolds and Allan E. Ceran, Santa Ana, California, for
Respondent MTC Financial Inc.
McCarthy & Holthus LLP and Kristin A. Schuler-Hintz, Las
Vegas, for Respondent Quality Loan Service Corporation.
Tiffany & Bosco, P.A., and Jason C. Kolbe and Kevin S.
Soderstrom, Las Vegas, for Respondent National Default
THE COURT EN BANC.
Chapter 649 governs agencies engaged in debt collection in
Nevada, while NRS Chapter 107 governs the deed of trust
system and the nonjudicial foreclosure process. In this
appeal, we determine whether trustees who exercise a power of
sale under a deed of trust pursuant to NRS Chapter 107 are
engaging in collection activities under NRS Chapter 649, such
that they must be licensed under that chapter.
Jeffrey Benko and 18 other individuals (collectively referred
to as Benko), brought a putative class action alleging that
respondents, all of whom are current or former NRS Chapter
107 trustees, engaged in unlicensed debt collection agency
activities by pursuing nonjudicial foreclosures on their
homes. The district court dismissed the complaint, finding
that the plain language of NRS Chapter 107 authorizes the
actions allegedly performed by respondents. We agree.
deed of trust trustees engage in activities that would
otherwise meet the definition of a debt collection agency
under NRS Chapter 649, the comprehensive scheme of NRS
Chapter 107 demonstrates that the Legislature intended to
exempt deed of trust trustees from NRS Chapter 649 licensing
requirements. Because Benko's allegations concern conduct
that falls within the scope of NRS Chapter 107, we conclude
that respondents were not required to be licensed under NRS
Chapter 649. Therefore, we affirm the district court's
order of dismissal.
AND PROCEDURAL HISTORY
filed a putative class action against respondents Quality
Loan Service Corporation; MTC Financial, Inc.; Meridian
Foreclosure Services; National Default Servicing Corporation;
and California Reconveyance Company (collectively referred to
as respondents), alleging claims of statutory consumer fraud
under NRS 41.600, based on violations of NRS 649.075 and NRS
649.171, and unjust enrichment. Benko's statutory fraud
claim relied on allegations that respondents acted as
collection agencies when they pursued payment of claims owed
or due, or asserted to be owed or due, to the lenders, and
they did not hold the requisite license to act as a
collection agency. Based on respondents' alleged illegal
collection practices, Benko further claimed that respondents
were unjustly enriched by substantial payments. Respondents
sought to dismiss the claims, maintaining that they were not
required to be licensed as collection agencies in their
capacity as trustees under NRS Chapter 107.
district court dismissed the case as a matter of law and
directed judgment in favor of respondents because"
[t]rustees are subject to NRS Chapter 107 and do not need to
be licensed as collection agencies" and the
"enforcement of security interests in real property does
not constitute doing business in the State of Nevada."
The district court found that NRS Chapter 107 empowers deed
of trust trustees to contract and perform duties to
accomplish nonjudicial foreclosure, that NRS Chapter 649
intends to exclude deed of trust trustees engaged in
nonjudicial foreclosure from its licensing requirements, that
enforcing a security interest in real property is not ...