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Bank of America, N.A v. Bar Arbor Glen at Providence Homeowners Association

United States District Court, D. Nevada

January 13, 2020

BANK OF AMERICA, N.A., Plaintiff
v.
BAR ARBOR GLEN AT PROVIDENCE HOMEOWNERS ASSOCIATION, et al., Defendants

          ORDER (1) GRANTING PLAINTIFF'S MOTION FOR SUMMARY JUDGMENT, (2) DISMISSING AS MOOT PLAINTIFF'S DAMAGES CLAIMS, AND (3) DENYING AS MOOT DEFENDANT BAR ARBOR'S MOTIONS [ECF NOS. 80, 84, 85]

          ANDREW P. GORDON UNITED STATES DISTRICT JUDGE.

         Plaintiff Bank of America, N.A. sues to determine whether a deed of trust encumbering property located at 7317 Perkins Hill Street in Las Vegas, Nevada was extinguished by a nonjudicial foreclosure sale conducted by a homeowners association (HOA), defendant Bar Arbor Glen at Providence Homeowners Association (Bar Arbor). Defendant SFR Investments Pool 1, LLC (SFR) purchased the property at the foreclosure sale. Bank of America seeks a declaration that the deed of trust still encumbers the property and it asserts alternative damages claims against Bar Arbor and Bar Arbor's foreclosure agent, Defendant Nevada Association Services, Inc. (NAS). SFR counterclaims for declaratory relief that it purchased the property free and clear of the deed of trust.

         Bank of America moves for summary judgment, arguing it tendered the superpriority amount prior to the sale and thereby preserved the deed of trust. SFR opposes Bank of America's motion but did not move for summary judgment. Bar Arbor opposes Bank of America's motion and moves to dismiss and for summary judgment, arguing it complied with Nevada law and there was nothing wrongful about the foreclosure.

         The parties are familiar with the facts, and I do not repeat them here except where necessary. I grant Bank of America's motion because no genuine dispute remains that Bank of America tendered the superpriority amount, thereby extinguishing the superpriority lien and rendering the sale void as to the deed of trust. I dismiss as moot Bank of America's alternative damages claims against Bar Arbor and NAS, and I deny as moot Bar Arbor's motions to dismiss and for summary judgment.

         I. ANALYSIS

         Summary judgment is appropriate if the movant shows “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), (c). A fact is material if it “might affect the outcome of the suit under the governing law.” Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). A dispute is genuine if “the evidence is such that a reasonable jury could return a verdict for the nonmoving party.” Id.

         The party seeking summary judgment bears the initial burden of informing the court of the basis for its motion and identifying those portions of the record that demonstrate the absence of a genuine issue of material fact. Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). The burden then shifts to the non-moving party to set forth specific facts demonstrating there is a genuine issue of material fact for trial. Fairbank v. Wunderman Cato Johnson, 212 F.3d 528, 531 (9th Cir. 2000); Sonner v. Schwabe N. Am., Inc., 911 F.3d 989, 992 (9th Cir. 2018) (“To defeat summary judgment, the nonmoving party must produce evidence of a genuine dispute of material fact that could satisfy its burden at trial.”). I view the evidence and reasonable inferences in the light most favorable to the non-moving party. James River Ins. Co. v. Hebert Schenk, P.C., 523 F.3d 915, 920 (9th Cir. 2008).

         Under Nevada law, a “first deed of trust holder's unconditional tender of the superpriority amount due results in the buyer at foreclosure taking the property subject to the deed of trust.” Bank of Am., N.A. v. SFR Investments Pool 1, LLC, 427 P.3d 113, 116 (Nev. 2018) (en banc). To be valid, tender must be for “payment in full” and must either be “unconditional, or with conditions on which the tendering party has a right to insist.” Id. at 118.

         Bank of America has met its burden of establishing that it tendered the superpriority amount in full. The HOA assessment was $40 per month. ECF No. 86-2 at 5. Prior to the HOA foreclosure sale, Bank of America tendered $360.00 to NAS to cover the superpriority amount of nine months of assessments. Id. at 11-15. NAS refused to accept the check, which was consistent with its policy at the time. Id. at 15; see also ECF Nos. 84-13; 84-14; 86-1. SFR has presented no contrary evidence in response. Consequently, no genuine dispute remains that the superpriority lien was extinguished and the property remains subject to the deed of trust. Bank of Am., N.A., 427 P.3d at 121.

         SFR raises several arguments as to why tender did not extinguish the superpriority lien. None raises a genuine dispute precluding summary judgment.

         1. Standing

         SFR contends that Bank of America lacks standing to enforce the note and deed of trust because it has not produced evidence showing that the note and deed of trust have been reunified through valid transfers to Bank of America. Bank of America responds that it does not seek to foreclose, it seeks only to determine adverse interests in property, and it has presented sufficient evidence of its interest to have standing for its declaratory relief claim.

         The question in this case is not whether Bank of America could presently foreclose. The question is whether Bank of America has a sufficient interest in the deed of trust that it has standing to seek declaratory relief as to the deed of trust's continuing validity. Bank of America is the beneficiary of record through its merger with BAC Home Loans Servicing, LP. ECF Nos. 84-2; 84-3. SFR has presented no contrary evidence. Bank of America therefore has standing to seek a declaration that the deed of trust remains an encumbrance on the property. SFR's contention that some documents in other cases have been shown to be incorrect or inauthentic does not raise an issue of fact in this case. SFR must show “more than metaphysical doubt as to the material facts, ” and it “has not done so here.” Berezovsky v. Moniz, 869 F.3d 923, 933 (9th Cir. 2017) (quotation omitted). Speculation that there might be errors is insufficient to preclude summary judgment. Emeldi v. Univ. of Oregon, 698 F.3d 715, 728 (9th Cir. 2012).

         2. ...


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