Carrington Mortg. Servs., LLC v. Tapestry At Town Ctr. Homeowners Ass'n

• Decision Date: 31 March 2019
• Docket Number: Case No. 2:17-cv-01047-RFB-PAL
• Parties: CARRINGTON MORTGAGE SERVICES, LLC, Plaintiff, v. TAPESTRY AT TOWN CENTER HOMEOWNERS ASSOCIATION; Terra West Collections Group LLC; SFR Investments Pool 1, LLC; Doe Individuals I-X, Inclusive; and Roe Corporations I-X, Inclusive, Defendants. SFR Investments Pool 1, LLC, Counter-Claimant/Cross-Claimant, v. Carrington Mortgage Services, LLC; Esther Marin, an Individual, Counter-Defendant/Cross-Defendant.
• Court: U.S. District Court — District of Nevada

381 F.Supp.3d 1289

CARRINGTON MORTGAGE SERVICES, LLC, Plaintiff,

v.TAPESTRY AT TOWN CENTER HOMEOWNERS ASSOCIATION; Terra West Collections Group LLC; SFR Investments Pool 1, LLC; Doe Individuals I-X, Inclusive; and Roe Corporations I-X, Inclusive, Defendants.

SFR Investments Pool 1, LLC, Counter-Claimant/Cross-Claimant,

v.Carrington Mortgage Services, LLC; Esther Marin, an Individual, Counter-Defendant/Cross-Defendant.

Case No. 2:17-cv-01047-RFB-PAL

United States District Court, D. Nevada.

Signed March 31, 2019

Ariel E. Stern, Natalie L Winslow, Tenesa S Powell, Akerman LLP, Las Vegas, NV, for Plaintiff.

Douglas M. Cohen, Gregory P. Kerr, Jordan J Butler, Wolf, Rifkin, Shapiro, Schulman & Rabkin, LLP, George F. Ogilvie, III, Jason B. Sifers, McDonald Carano Wilson LLP, Aviva Y Gordon, Gordon Law, Diana S. Ebron, Jacqueline A. Gilbert, Karen L. Hanks, Jason G. Martinez, Kim Gilbert Ebron, Las Vegas, NV, for Defendants.

ORDER

RICHARD F. BOULWARE, II, UNITED STATES DISTRCIT JUDGE

I. INTRODUCTION

Before the Court are Defendant/Counter-Claimant/Cross-Claimant SFR Investments Pool 1, LLC's ("SFR's") Renewed Motion for Summary Judgment (ECF No. 50), Plaintiff/Counter-Defendant Carrington Mortgage Services, LLC's ("Carrington's") Renewed Motion for Summary Judgment (ECF No. 51), and Defendant Tapestry at Town Center Homeowners Association's ("the HOA's") Counter Motion for Summary Judgment (ECF No. 56).

In the complaint filed May 9, 2017, Carrington seeks quiet title/declaratory judgment and injunctive relief based on allegations of wrongful foreclosure violating the federal constitution and Nevada statutes. ECF No. 1. For the reasons stated below, the Court grants in part and denies in part all three motions.

II. FACTUAL BACKGROUND

a. Undisputed Facts

The Court finds that the following facts are undisputed.

On or about February 27, 2008, Esther Marin and Rosa Linares ("the borrowers") purchased property located at 9141 Captivating Avenue, Las Vegas, Nevada 89149 ("the Property"). The borrowers financed ownership of the property by way of a loan in the amount of $ 162,649.00 evidenced by a note and secured by a deed of trust (the senior deed of trust) recorded February 29, 2008.

The borrowers failed to pay the HOA all amounts due to it. On May 5, 2010, the HOA, through its agent Assessment Management Services ("AMS"), recorded a notice of claim of delinquent assessment lien. Per the notice, the amount due to the HOA was $ 1,169.04, which includes assessments, late fees, special assessments, fines, collection fees, trustee fees, and interest.

On April 23, 2012, the HOA, through its agent AMS, recorded a notice of default and election to sell under homeowners association lien. The notice states the amount due to the HOA was $ 3,130.42, which may include assessments, late fees, special assessments, collection fees, trustee fees, and interest.

On February 26, 2014, the HOA, through its agent AMS, recorded a notice of foreclosure sale. The notice states the amount due to the HOA was $ 7,118.63, which may include assessments, late fees, special assessments, collection fees, and interest.

The HOA foreclosed on the property on or about March 21, 2014. A foreclosure deed in favor of SFR was recorded April 2, 2014.

b. Disputed Facts

The parties dispute whether the Property is insured by the Federal Housing Administration ("FHA"), whether the deed of trust was properly assigned to Carrington, and whether tender was offered and/or rejected.

Regarding tender, Carrington alleges that Miles, Bauer, Bergstrom and Winters on behalf of Bank of America sent the HOA and its foreclosure agent AMS a letter dated May 23, 2012 requesting sufficient information to identify nine months' of common assessments and offering to pay that sum. Carrington alleges that the HOA and AMS refused to identify the super-priority amount, but provided a ledger indicating the monthly assessment amount was $ 66.00. Nine months of monthly assessments totals $ 594, and Bank of America allegedly tendered $ 988.00 to the HOA to satisfy the super-priority lien—nearly $ 400.00 more than the actual super-priority amount. AMS allegedly rejected the payment.

III. PROCEDURAL BACKGROUND

Carrington filed its Complaint on April 13, 2017. ECF No. 1. The HOA filed an answer on May 24, 2017. ECF No. 11. SFR filed on answer on June 26, 2017, with a cross-claim against Esther Marin and a counter-claim against Carrington. ECF No. 22.

On June 26, 2017, the Court entered a scheduling order. ECF No. 20.

Carrington filed an answer to the counter-claim on June 30, 2017. ECF No. 24. Terra West Collections Group LLC filed an answer on July 10, 2017. ECF No. 25.

Discovery closed on November 20, 2017. ECF No. 20. On December 8, 2017, the Clerk of Court entered default as to Esther Marin. ECF No. 36.

On December 18, 2017, Carrington filed a Motion for Summary Judgment. ECF No. 38. On December 20, 2017, SFR filed a Motion for Summary Judgment. ECF No. 39.

On July 12, 2018, the Court denied all pending motions without prejudice and issued a stay in the case pending the Nevada Supreme Court's decision on a certified question of law regarding NRS 116's notice requirement in Bank of N.Y. Mellon v. Star Hill Homeowners Ass'n, Case No. 2:16-cv-02561-RFB-PAL. ECF No. 49. The Nevada Supreme Court published an answer to the certified question on August 2, 2018. SFR Investments Pool 1, LLC v. Bank of New York Mellon, ––– Nev. ––––, 422 P.3d 1248 (2018).

On August 23, 2018, SFR and Carrington each filed the instant Renewed Motions for Summary Judgment. ECF Nos. 50, 51. On September 14, 2018, the HOA filed the instant Counter Motion for Summary Judgment. ECF No. 56.

The Court now lifts the stay in this case and considers all pending motions.

IV. LEGAL STANDARD

Summary judgment is appropriate when the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show "that 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); accord Celotex Corp. v. Catrett, 477 U.S. 317, 322, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). When considering the propriety of summary judgment, the court views all facts and draws all inferences in the light most favorable to the nonmoving party. Gonzalez v. City of Anaheim, 747 F.3d 789, 793 (9th Cir. 2014). If the movant has carried its burden, the non-moving party "must do more than simply show that there is some metaphysical doubt as to the material facts.... Where the record taken as a whole could not lead a rational trier of fact to find for the nonmoving party, there is no genuine issue for trial." Scott v. Harris, 550 U.S. 372, 380, 127 S.Ct. 1769, 167 L.Ed.2d 686 (2007) (alteration in original) (internal quotation marks omitted).

V. DISCUSSION

a. SFR's Motion for Summary Judgment

SFR seeks summary judgment as to Carrington's claims against it and as to its counter-claims against Carrington. SFR additionally seeks summary judgment on its cross-claim against Marin, who has not participated in this lawsuit thus far and against whom a clerk's default has been entered.

i. Statute of Limitations

SFR argues that Carrington's complaint is time-barred pursuant to a three-year statute of limitations. For statute of limitations calculations, time is computed from the day the cause of action accrued. Clark v. Robison, 113 Nev. 949, 944 P.2d 788, 789 (1997). The foreclosure sale occurred on March 21, 2014. The Court finds that all of Carrington's claims began to run on the date of the foreclosure sale as these claims all stem from issues or disputes regarding the sale and its effect. The complaint was filed on April 13, 2017, over three years later.

Carrington argues that SFR waived the statute of limitations defense by failing to raise the defense in its answer. While the Court agrees that a statute of limitations defense is waivable pursuant to Rule 8 of the Federal Rules of Civil Procedure, SFR plainly raised the issue in its Answer. ECF No. 22 at 8 ("The Bank's causes of action are barred in whole or in part by the applicable statutes of limitations....").

The Court finds that, to the extent Carrington's pleading relates to any alleged violation of a right protected by statute, Carrington's claims carry a three-year statute of limitations pursuant to NRS 11.190(3)(a), which applies to actions upon a liability created by statute. Therefore, Carrington's second cause of action for breach of NRS 116.1113 is entirely foreclosed, and its remaining causes of action for quiet title/declaratory relief, wrongful foreclosure, and injunctive relief are foreclosed only to the extent violations of NRS 116.1113 are alleged. However, to the extent Carrington seeks relief based on alleged unconstitutionality or on equitable grounds, Carrington's claims fall within the four-year catch-all provision at NRS 11.220 and are therefore timely.

The Court finds Carrington is not entitled to the five-year statute of limitations for certain quiet title actions pursuant to NRS 11.070 and 11.080. The statute of limitations provided by these code sections only apply when the plaintiff actually "was seized or possessed of the premises." Nev. Rev. Stat. §§ 11.070, 11.080 ; see also Saticoy Bay LLC Series 2021 Gray Eagle Way v. JPMorgan Chase Bank, N.A., ––– Nev. ––––, 388 P.3d 226, 232 (2017) ( NRS 11.080 ); Bissell v. Coll. Dev. Co., 86 Nev. 404, 469 P.2d 705, 707 (1970) ( NRS 11.070 ). NRS 11.070 and 11.080 do not apply to claims by parties that held only a lien interest, not title.

The Court also does not find that Carrington's declaratory relief claim is not bound by a statute of limitations. But "[a] claim for declaratory relief is subject to a statute of limitations generally applicable to civil claims." Zuill v. Shanahan, 80 F.3d 1366, 1369–70 (9th Cir. 1996). Facklam, relied upon by Carrington, holds only that a statute of limitations does not operate to bar a nonjudicial foreclosure, as such a foreclosure...