Saticoy Bay, LLC v. Peccole Ranch Cmty. Ass'n

• Decision Date: 23 September 2021
• Docket Number: No. 81446,81446
• Citation: 495 P.3d 492
• Parties: SATICOY BAY, LLC, SERIES 9720 HITCHING RAIL, a Nevada Limited Liability Company, Appellant, v. PECCOLE RANCH COMMUNITY ASSOCIATION; and Nevada Association Services, Inc., Respondents.
• Court: Nevada Supreme Court

495 P.3d 492

SATICOY BAY, LLC, SERIES 9720 HITCHING RAIL, a Nevada Limited Liability Company, Appellant,

v.PECCOLE RANCH COMMUNITY ASSOCIATION; and Nevada Association Services, Inc., Respondents.

No. 81446

Supreme Court of Nevada.

FILED SEPTEMBER 23, 2021

Roger P. Croteau & Associates, Ltd., and Roger P. Croteau, Las Vegas, for Appellant.

Lipson Neilson P.C. and Kaleb D. Anderson and Amanda A. Ebert, Las Vegas, for Respondents.

BEFORE THE SUPREME COURT, PARRAGUIRRE, STIGLICH, and SILVER, JJ.

OPINION

By the Court, STIGLICH, J.:

NRS 38.310 requires parties to attempt alternative dispute resolution as a prerequisite to filing a civil action "based upon a claim relating to ... [t]he interpretation, application or enforcement of any covenants, conditions or restrictions [CC&Rs] applicable to residential property or any bylaws, rules or regulations adopted by an association." In this opinion, we consider whether a suit dismissed for noncompliance with this statute fell within its scope. Appellant Saticoy Bay, LLC, Series 9720 Hitching Rail purchased property at a homeowners’ association (HOA) foreclosure sale conducted after the previous owner defaulted on HOA assessments imposed by the CC&Rs. Saticoy Bay claims it believed it was purchasing the property free of other liens. However, the first deed of trust on the property survived the foreclosure sale, and Saticoy Bay sued the HOA and its agent, alleging misrepresentation, breach of the duty of good faith, conspiracy, and violation of NRS Chapter 113.

The district court granted respondents’ motion to dismiss on the ground that Saticoy Bay had not engaged in alternative dispute resolution before filing suit, violating NRS 38.310. Saticoy Bay appeals, arguing that NRS 38.310 did not apply to its claims. We agree. The mere fact that these claims arose out of an HOA foreclosure sale is not sufficient to trigger NRS 38.310 ’s mediation requirement. Mediation is required before a district court can hear a claim that itself requires "interpretation, application or enforcement" of HOA CC&Rs, rules, bylaws, or regulations. Here, there is no dispute that the HOA properly foreclosed after the owner failed to pay their assessments, only that it did not disclose to the prospective new owner an existing interest in the property. Because the tort claims asserted in this matter are unrelated to the interpretation, application, or enforcement of HOA CC&Rs or rules, NRS 38.310 ’s scope does not encompass those claims.

BACKGROUND

The previous owner of 9720 Hitching Rail Drive in Las Vegas entered into a first deed of trust with Countrywide KB Home Loans, LLC. Several years later, this deed of trust was assigned to Bank of America, N.A. (BANA). The homeowner became delinquent on her assessment fees to Peccole Ranch Community Association (the HOA), and the HOA, through its agent Nevada Association Services, Inc., recorded a notice of default and election to sell in December 2011. BANA, through its agent, subsequently tendered the amount of the superpriority lien to preserve its deed of trust, but the HOA trustee rejected the payment and moved forward with the property's sale. In 2014, Saticoy Bay purchased the property at the foreclosure sale.

In 2016, BANA filed a quiet title complaint in federal district court. The federal court found that BANA's deed of trust survived the foreclosure sale. This finding was based on our 2018 decision that "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," even if the HOA rejects the tender. Bank of Am., N.A. v. SFR Invs. Pool 1, LLC , 134 Nev. 604, 605, 427 P.3d 113, 116 (2018). Saticoy Bay sued respondents the HOA and its trustee, alleging misrepresentation, breach of the duty of good faith, conspiracy, and violation of NRS 113.130. Its claims hinge on the assertion that the HOA and its trustee should have disclosed BANA's tender of the superpriority lien that made Saticoy Bay's ownership of the property subject to BANA's first deed of trust. Saticoy Bay asserts that, if it had been aware of any tender by BANA, it would not have bid on the property.

Respondents moved to dismiss the suit for noncompliance with NRS 38.310 or alternatively for dismissal for failure to state a claim or for summary judgment. The district court dismissed the case without prejudice, concluding that the action was "related to the enforcement of CC&Rs," that NRS 38.310 therefore applied, and that Saticoy Bay had filed its complaint without participating in prelitigation mediation. The district court accordingly declined to reach respondents’ alternative bases for relief. Saticoy Bay appeals.

DISCUSSION

The district court's order dismissing the action based on NRS 38.310 involves a question of statutory interpretation; we therefore review this appeal de novo. See McKnight Fam., LLP v. Adept Mgmt. Servs., Inc., 129 Nev. 610, 614, 310 P.3d 555, 558 (2013). As a preliminary matter, however, we begin with respondents’ contention that we lack jurisdiction to consider this matter.

The district court's order was a final, appealable judgment

Respondents contend that the district court's order granting the motion to dismiss in this action was not a final, appealable judgment because the case was dismissed without prejudice. The order stated that the case may be filed again if the parties were unable to successfully resolve their claims through mediation. NRAP 3A(b)(l) allows an appeal to be taken from "[a] final judgment entered in an action or proceeding commenced in the court in which the judgment is rendered." Whether a dismissal without prejudice pursuant to an exhaustion statute like NRS 38.310 is a final judgment is a question of first impression.

We have clarified that "a final judgment is one that disposes of all the issues presented in the case, and leaves nothing for the future consideration of the court, except for post-judgment issues such as attorney's fees and costs." Lee v. GNLV Corp ., 116 Nev. 424, 426, 996 P.2d 416, 417 (2000) (internal quotation marks omitted). Generally, a dismissal without prejudice expresses that the same claims could be refiled as a new case. See 24 Am. Jur. 2d Dismissal § 2 ("[T]he primary meaning of ‘dismissal without prejudice’ is dismissal without barring the defendant from returning later, to the same court, with the same underlying claim.").

We have said that "a district court order dismissing a complaint with leave to amend is not final and appealable." Bergenfield v. BAC Home Loans Servicing, LP, 131 Nev. 683, 685, 354 P.3d 1282, 1284 (2015). Although a dismissal without prejudice is not entirely different from a general dismissal with leave to amend, that is not the case for dismissals under NRS 38.310.

Here, Saticoy Bay's case was dismissed with allowance to leave the public courts, enter mediation for its claims, and refile in the district court only if mediation fails. The district court made clear that refiling without entering mediation would mandate dismissal again in this matter. Saticoy Bay insisted—and continues to insist—that its claims do not require mediation.

In all circumstances, "[t]he finality of an order or judgment depends on what the order or judgment actually does ...." Brown v. MHC Stagecoach, LLC , 129 Nev. 343, 345, 301 P.3d 850, 851 (2013) (internal quotation marks omitted). NRS 38.310 ’s prefiling requirement is not dissimilar to requirements of exhaustion of administrative remedies before filing a civil complaint. See Nationstar Mortg., LLC v. Maplewood Springs Homeowners Ass'n, 238 F. Supp. 3d 1257, 1269 (D. Nev. 2017) (holding that " NRS 38.310 is an exhaustion statute that creates prerequisites for filing certain state-law claims" (emphasis added)). The effect of the district court's order here more conclusively bars Saticoy Bay from the courts than a typical dismissal without prejudice. We agree with the Eleventh Circuit's conclusion that "a ‘district court's dismissal of a case without prejudice for failure to exhaust administrative remedies is a final order, giving an appellate court jurisdiction.’... [T]he practical effect of the district court's order here is to deny the plaintiffs judicial relief until they have exhausted their administrative remedies." Peterson v. BMI Refractories , 132 F.3d 1405, 1411 (11th Cir. 1998) (quoting Kobleur v. Grp . Hospitalization & Med. Serv., Inc., 954 F.2d 705, 708 (11th Cir. 1992) ). Therefore, we conclude that orders dismissing without prejudice on the basis of failure to comply with NRS 38.310 constitute appealable final orders subject to the jurisdiction of this court on appeal.

NRS 38.310 did not require prefiling alternative dispute resolution in this case

Saticoy Bay contends that its claims do not implicate NRS 38.310 because this case does not require the interpretation, application, or enforcement of any CC&Rs or HOA rules. We agree.

NRS 38.310 bars certain civil actions from being filed unless the dispute has already been submitted to alternative dispute resolution. As relevant to this case, NRS 38.310(1) provides as follows:

No civil action based upon a claim relating to:

(a) The interpretation, application or enforcement of any covenants, conditions or restrictions applicable to residential property or any bylaws, rules or regulations adopted by an association;

...

may be commenced in any court in this State unless the action has been submitted to mediation or, if the parties agree, has been referred to a program pursuant to the provisions of NRS 38.300 to 38.360, inclusive ....

No alternative dispute resolution processes were undertaken before Saticoy Bay filed its complaint.

NRS 38.310(l)(a)'s bar is triggered when (1) the case is a "civil action,"¹ and (2) the action is based on claims "relating to ... [t]he interpretation, application or enforcements" of CC&Rs or HOA rules or bylaws.² NRS 38.310. The parties dispute only the second prong of this...