Branch Banking & Trust Co. v. Pebble Creek Plaza, LLC, No. 2:12–cv–01737–LRH.

CourtUnited States District Courts. 9th Circuit. United States District Courts. 9th Circuit. District of Nevada
Writing for the CourtLARRY R. HICKS
Citation46 F.Supp.3d 1061
PartiesBRANCH BANKING AND TRUST COMPANY, a North Carolina banking corporation, Plaintiff, v. PEBBLE CREEK PLAZA, LLC, a Nevada limited liability company; Yoel Iny; Noam Schwartz; Yoel Iny, Trustee of the Y & T Iny Family Trust dated June 8, 1994; Noam Schwartz, Trustee of the Noam Schwartz Trust dated August 19, 1999; D.M.S.I., LLC, a Nevada limited liability company; and does 1 through 10, inclusive; Defendants.
Docket NumberNo. 2:12–cv–01737–LRH.
Decision Date15 September 2014

46 F.Supp.3d 1061

BRANCH BANKING AND TRUST COMPANY, a North Carolina banking corporation, Plaintiff,
v.
PEBBLE CREEK PLAZA, LLC, a Nevada limited liability company; Yoel Iny; Noam Schwartz; Yoel Iny, Trustee of the Y & T Iny Family Trust dated June 8, 1994; Noam Schwartz, Trustee of the Noam Schwartz Trust dated August 19, 1999; D.M.S.I., LLC, a Nevada limited liability company; and does 1 through 10, inclusive; Defendants.

No. 2:12–cv–01737–LRH.

United States District Court, D. Nevada.

Signed Sept. 15, 2014


Holder's motion granted and defendants' motion denied.

[46 F.Supp.3d 1063]

Brian G. Anderson, Nicole E. Lovelock, Holland & Hart LLP, Las Vegas, NV, Jeremy J. Nork, Holland & Hart LLP, Reno, NV, For Plaintiff.

E. Daniel Kidd, Kolesar & Leatham, Chtd., Las Vegas, NV, for Defendants.


ORDER

LARRY R. HICKS, District Judge.

Before the Court is Plaintiff Branch Banking and Trust Company's (“Branch Banking”) Motion for Summary Judgment as to Liability and Application for Deficiency

[46 F.Supp.3d 1064]

Judgment Hearing. Doc. # 67.1 Defendants Pebble Creek Plaza, LLC; Yoel Iny; Noam Schwartz; Yoel Iny, Trustee of the Y & T Family Trust dated June 8, 1994; Noam Schwartz, Trustee of the Noam Schwartz Trust dated August 19, 1999; and D.M.S.I., LLC (collectively “Defendants”) filed a Response (Doc. # 75), to which Branch Banking replied (Doc. # 84). Defendants also filed a Motion for Summary Judgment. Doc. # 87. Branch Banking filed a Response (Doc. # 98), to which Defendants replied (Doc. # 103).

Also before the Court is Defendants' Objection to the Magistrate Judge's Order Related to the Loss Sharing Agreement (Doc. # 104) and Motion to Reconsider Pursuant to Local Rule IB 3–1(a). Doc. # 106. Branch Banking filed a Response (Doc. # 108), to which Defendants replied (Doc. # 110). Also before the Court is Defendants' Motion to Certify Question to the Nevada Supreme Court. Doc. # 111. Branch Banking filed a Response (Doc. # 113), to which Defendants replied (Doc. # 114).

I. Facts and Background

This action arises out of Defendants' alleged breach of a secured loan agreement. Following a judicial foreclosure sale on the real property securing the loan, Branch Banking filed the present action to obtain a deficiency judgment against Defendants. Doc. # 1. The undisputed facts are as follows. On September 12, 2006, Borrower Pebble Creek Plaza, LLC (“Borrower”) executed and delivered a Promissory Note Secured by Deed of Trust to Colonial Bank, N.A. 2 (“Colonial Bank”), in the original amount of $3,526,000.00 (the “Note”). Doc. # 67, Ex. 1A; Doc. # 87, Ex. 1. The Note was secured by a Deed of Trust and Security Agreement and Fixture Filing with Assignment of Rents (“Deed of Trust”), dated September 12, 2006, encumbering certain real property in Maricopa County, Arizona (the “Property”).3 Doc. # 67, Ex. 1B; Doc. # 87, Ex. 2. Also on September 12, 2006, Defendants Yoel Iny, individually and as Trustee of the Y & T Iny Family Trust; Noam Schwartz, individually and as Trustee of the Noam Schwartz Trust; and D.M.S.I., LLC (“Guarantors”) executed and delivered to Colonial Bank a Guarantee (the “Guarantee”). Doc. # 67, Ex. 1 C; Doc. # 87, Ex. 3. Pursuant to the Guarantee, the Guarantors guaranteed the payment of all indebtedness of the Borrower under the loan evidenced by the Note (the “Loan”). Id.

On May 26, 2009, the Note was amended by an Amendment to Promissory Note Secured by Deed of Trust such that the Maturity Date on the Note was extended to June 29, 2009 (the “Amendment”). Doc. # 67, Ex. 1D; Doc. # 87, Ex. 4. Also on May 26, 2009, a Modification to the Deed of Trust was executed and recorded in Maricopa County, Arizona. Doc. # 87, Ex. 5. On August 14, 2009, Colonial Bank was closed by the State Banking Department of the State of Alabama and the Federal Deposit Insurance Corporation (“FDIC”) was named receiver in order to liquidate and distribute the assets of Colonial Bank. Doc. # 67, Ex. 1E; Doc. # 87, Ex. 6. On September 28, 2011, the FDIC executed an

[46 F.Supp.3d 1065]

Assignment of Security Instruments, Notes and Other Loan Documents (the “Assignment”), to be deemed effective as of August 14, 2009. Id. Pursuant to the terms of the Assignment, the FDIC assigned all rights, title, and interest in the Note, the Deed of Trust, and the Guarantee to Branch Banking. Id. The Assignment was recorded in Maricopa County, Arizona on November 4, 2011. Id.

The Borrower failed to pay the outstanding principal balance of the loan due under the Note on June 29, 2009.4 Doc. # 84–3, Ex. 2 (Schwartz Depo.), 12:25–13:4. By demand letter dated August 3, 2011 (the “Demand Letter”), Branch Banking indicated its intent to take steps to exercise its rights and remedies under the Loan on or after August 31, 2011. Doc. # 67, Ex. 1F. Branch Banking alleges that the Borrower and the Guarantors failed and refused to pay the balance due under the Note. Doc. # 1, ¶ 25. On December 16, 2011, Branch Banking commenced a judicial foreclosure action under the Deed of Trust by filing a Verified Complaint in the Superior Court of the County of Maricopa, Arizona. Doc. # 87, Ex. 7. A Default Judgment ordering the judicial foreclosure of the Property in full or partial satisfaction of the outstanding balance due under the Loan via Sheriff's sale was entered by the Superior Court of the County of Maricopa, Arizona, on May 30, 2012. Doc. # 67, Ex. 1 G; Doc. # 87, Ex. 11. The Sheriff of the County of Maricopa, Arizona, sold the Property on July 19, 2012, at public auction for a cash bid of $1,520,000.00 in partial satisfaction of the Loan. Doc. # 67, Ex. 1H; Doc. # 87, Ex. 12.

On October 3, 2012, Branch Banking filed a Complaint before this Court, alleging claims for deficiency, breach of guarantee, and breach of the covenant of good faith and fair dealing. Doc. # 1. Branch Banking claims that there is an unpaid principal balance of $3,447,781.11 as of July 19, 2012. See id. at ¶ 29; see also Doc. # 67, Ex. 1 G; Doc. # 87, Ex. 11.

II. Legal Standard A. Summary Judgment

Summary judgment is appropriate only when the pleadings, depositions, answers to interrogatories, affidavits or declarations, stipulations, admissions, and other materials in the record show that “there is no genuine issue as to any material fact and the movant is entitled to judgment as a matter of law.” Fed.R.Civ.P. 56(a). In assessing a motion for summary judgment, the evidence, together with all inferences that can reasonably be drawn therefrom, must be read in the light most favorable to the party opposing the motion. Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986); Cnty. of Tuolumne v. Sonora Cmty. Hosp., 236 F.3d 1148, 1154 (9th Cir.2001).

The moving party bears the initial burden of informing the court of the basis for its motion, along with evidence showing the absence of any genuine issue of material fact. Celotex Corp. v. Catrett, 477 U.S. 317, 323, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). On those issues for which it bears the burden of proof, the moving party must make a showing that is “sufficient for

[46 F.Supp.3d 1066]

the court to hold that no reasonable trier of fact could find other than for the moving party.” Calderone v. United States, 799 F.2d 254, 259 (6th Cir.1986); see also Idema v. Dreamworks, Inc., 162 F.Supp.2d 1129, 1141 (C.D.Cal.2001). On an issue as to which the non-moving party has the burden of proof, however, the moving party can prevail merely by demonstrating that there is an absence of evidence to support an essential element of the non-moving party's case. Celotex, 477 U.S. at 323, 106 S.Ct. 2548.

To successfully rebut a motion for summary judgment, the non-moving party must point to facts supported by the record which demonstrate a genuine issue of material fact. Reese v. Jefferson Sch. Dist. No. 14J, 208 F.3d 736 (9th Cir.2000). A “material fact” is a fact “that might affect the outcome of the suit under the governing law.” Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). Where reasonable minds could differ on the material facts at issue, summary judgment is not appropriate. See v. Durang, 711 F.2d 141, 143 (9th Cir.1983). A dispute regarding a material fact is considered genuine “if the evidence is such that a reasonable jury could return a verdict for the nonmoving party.” Liberty Lobby, 477 U.S. at 248, 106 S.Ct. 2505. The mere existence of a scintilla of evidence in support of the party's position is insufficient to establish a genuine dispute; there must be evidence on which a jury could reasonably find for the party. See id. at 252, 106 S.Ct. 2505. Finally, whereas here, both sides have moved for summary judgment, the court must consider evidence submitted in support of both motions before ruling on either motion. See Fair Housing Council of Riverside Cnty., Inc. v. Riverside Two, 249 F.3d 1132, 1136 (9th Cir.2001).

B. Motion to Reconsider

Local Rule IB 3–1 authorizes a District Judge to reconsider any pretrial matter referred to a Magistrate Judge pursuant to LR IB 1–3 where it has been shown that the Magistrate Judge's Order is clearly erroneous or contrary to law. A party wishing to file objections to a Magistrate Judge's Order must do so within fourteen (14) days from the date of service of the Magistrate Judge's ruling. LR IB 3–1(a). A finding is clearly erroneous when the district judge “is left with the definite and firm conviction that a mistake has been committed.” United States v. Ressam, 629 F.3d 793, 825 (9th Cir.2010) (quoting Concrete Pipe & Prods. of Cal., Inc. v. Constr. Laborers Pension Trust for S. Cal., 508 U.S. 602, 622, 113 S.Ct. 2264, 124 L.Ed.2d 539 (1993)).

C. Motion to Certify Question to the Nevada Supreme Court

Pursuant to Nevada Rule of Appellate Procedure (“NRAP”) 5:

The [Nevada] Supreme Court may answer questions of law certified to it by ... a United States District Court ... when requested by the certifying...

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3 practice notes
  • Branch Banking & Trust Co. v. 27TH & S. Holding, LLC, 2:12-CV-01781-LRH-PAL
    • United States
    • United States District Courts. 9th Circuit. United States District Courts. 9th Circuit. District of Nevada
    • July 11, 2016
    ...or trustee's sale." NEV. REV. STAT. § 40.457(1). An evidentiary hearing is mandatory. Branch Banking & Trust Co. v. Pebble Creek, LLC, 46 F. Supp. 3d 1061, 1076 (D. Nev. 2014) ("in no unclear terms, NRS § 40.457(1) requires the CourtPage 5 to hold a hearing and consider all relevant evidenc......
  • Wells Fargo Bank, N.A. v. Kaveh, Case No.: 2:13-cv-01472-GMN-NJK
    • United States
    • United States District Courts. 9th Circuit. United States District Courts. 9th Circuit. District of Nevada
    • March 31, 2017
    ...sale." Nev. Rev. Stat. § 40.457(1). An evidentiary hearing is mandatory. Branch Banking & Trust Co. v. Pebble Creek Plaza, LLC,Page 4 46 F. Supp. 3d 1061, 1076 (D. Nev. 2014) ("In no unclear terms, NRS § 40.457(1) requires the Court to hold a hearing and consider all relevant evidence in de......
  • Cxa-10 Corp. v. Ford, No. 14-17537
    • United States
    • United States Courts of Appeals. United States Court of Appeals (9th Circuit)
    • December 21, 2016
    ...market value of a property is at issue, this hearing is mandatory. See, e.g., Branch Banking & Trust Co. v. Pebble Creek Plaza, LLC, 46 F. Supp. 3d 1061, 1076 (D. Nev. 2014). Here, however, fair market value of the property was not at issue; rather, Ford himself moved for summary judgment o......
3 cases
  • Branch Banking & Trust Co. v. 27TH & S. Holding, LLC, 2:12-CV-01781-LRH-PAL
    • United States
    • United States District Courts. 9th Circuit. United States District Courts. 9th Circuit. District of Nevada
    • July 11, 2016
    ...or trustee's sale." NEV. REV. STAT. § 40.457(1). An evidentiary hearing is mandatory. Branch Banking & Trust Co. v. Pebble Creek, LLC, 46 F. Supp. 3d 1061, 1076 (D. Nev. 2014) ("in no unclear terms, NRS § 40.457(1) requires the CourtPage 5 to hold a hearing and consider all relevant evidenc......
  • Wells Fargo Bank, N.A. v. Kaveh, Case No.: 2:13-cv-01472-GMN-NJK
    • United States
    • United States District Courts. 9th Circuit. United States District Courts. 9th Circuit. District of Nevada
    • March 31, 2017
    ...sale." Nev. Rev. Stat. § 40.457(1). An evidentiary hearing is mandatory. Branch Banking & Trust Co. v. Pebble Creek Plaza, LLC,Page 4 46 F. Supp. 3d 1061, 1076 (D. Nev. 2014) ("In no unclear terms, NRS § 40.457(1) requires the Court to hold a hearing and consider all relevant evidence in de......
  • Cxa-10 Corp. v. Ford, No. 14-17537
    • United States
    • United States Courts of Appeals. United States Court of Appeals (9th Circuit)
    • December 21, 2016
    ...market value of a property is at issue, this hearing is mandatory. See, e.g., Branch Banking & Trust Co. v. Pebble Creek Plaza, LLC, 46 F. Supp. 3d 1061, 1076 (D. Nev. 2014). Here, however, fair market value of the property was not at issue; rather, Ford himself moved for summary judgment o......

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