Saticoy Bay LLC 2794 v. Bank of America, N.A. ( 2021 )

NOT FOR PUBLICATION FILED
UNITED STATES COURT OF APPEALS DEC 8 2021
MOLLY C. DWYER, CLERK
U.S. COURT OF APPEALS
FOR THE NINTH CIRCUIT
SATICOY BAY LLC SERIES 2794 No. 20-15349
MURRAY HILL LN,
D.C. No.
Plaintiff-Appellant, 2:12-cv-02028-RFB-EJY
and
MEMORANDUM*
ALESSI & KOENIG, LLC,
Plaintiff,
v.
BANK OF AMERICA, N.A.,
Defendant-Appellee,
and
FEDERAL HOME LOAN MORTGAGE
CORPORATION; PATRICIA E. LEON,
Defendants.
Appeal from the United States District Court
for the District of Nevada
Richard F. Boulware II, District Judge, Presiding
*
This disposition is not appropriate for publication and is not precedent
except as provided by Ninth Circuit Rule 36-3.
Submitted December 6, 2021**
San Francisco, California
Before: WARDLAW, BRESS, and BUMATAY, Circuit Judges.
Saticoy Bay LLC Series 2794 Murray Hill Lane (“Saticoy Bay”) appeals from
the district court’s grant of summary judgment to Bank of America on Saticoy Bay’s
suit seeking to quiet title for the property located at 2794 Murray Hill Lane in Las
Vegas, Nevada (“the property”). We have jurisdiction under 28 U.S.C. § 1291. We
review the grant of summary judgment de novo, see KST Data, Inc. v. DXC Tech.
Co., 980 F.3d 709, 713 (9th Cir. 2020), and we affirm.
1. The district court correctly concluded that Saticoy Bay does not own
the property free and clear of Freddie Mac’s interest. Saticoy Bay’s predecessor in
interest, Ferrell Street Trust, purchased the property at a homeowner association
(“HOA”) foreclosure sale on July 2, 2012. Although Nevada law gives delinquent
HOA dues “superpriority” status over other liens, the Federal Foreclosure Bar
preempts this law, and it protects the FHFA’s assets from certain adverse actions,
including “levy, attachment, garnishment, foreclosure, or sale without the consent
of the Agency.” 12 U.S.C. § 4617(j)(3); Nationstar Mortg. LLC v. Saticoy Bay LLC,
Series 9229 Millikan Ave., 996 F.3d 950, 958 (9th Cir. 2021) (“Millikan”).
**
The panel unanimously concludes this case is suitable for decision
without oral argument. See Fed. R. App. P. 34(a)(2).
2
The Federal Foreclosure Bar covers all of Freddie Mac’s assets, whether they
are security interests or title interests. See Millikan, 996 F.3d at 957. Here, at the
time of the HOA sale, the Federal Housing Finance Agency (“FHFA”), as Freddie
Mac’s conservator, see 12 U.S.C. §§ 4511–13, had both a security interest and a title
interest in the property.
Freddie Mac purchased the loan on the property from Countrywide Home
Loans in 2006, and its loan servicer, Bank of America, was the publicly recorded
deed-of-trust beneficiary as of 2009 (through its predecessor BAC Home Loans
Servicing). Under Nevada law, this arrangement created a protectable security
interest. Contrary to Saticoy Bay’s position, “Nevada’s recording statutes do not
require [Freddie Mac] to be identified as the beneficiary of record on the Deed in
order to establish its ownership interest in the loan, nor do they require [Freddie
Mac] ‘to otherwise publicly record its ownership interest.’” Millikan, 996 F.3d at
957 (quoting Daisy Tr. v. Wells Fargo Bank, N.A., 445 P.3d 846, 849 (Nev. 2019)
(citations and alterations omitted)). All that is needed is Freddie Mac’s “loan
servicer and agent . . . listed as the beneficiary on the recorded Deed,” id., which was
the case here.
Freddie Mac also obtained valid title by purchasing the property at an earlier
foreclosure sale on March 7, 2012. Under Nevada law, “a foreclosure sale is
complete and title vests in the purchaser once payment has been made by the highest
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bidder.” Resources Grp., LLC v. Nevada Ass’n Servs., 437 P.3d 154, 158 (Nev.
2019). Even if Freddie Mac was required subsequently to record in order to establish
its title interest, it recorded before Ferrell Street Trust did. Because Nevada is a race-
notice jurisdiction, Freddie Mac would have therefore obtained superior title on this
basis as well. See Buhecker v. R.B. Petersen & Sons Constr. Co., 929 P.2d 937, 939
(Nev. 1996).
Thus, Freddie Mac had a protected property interest at the time of the HOA
foreclosure sale, and the FHFA’s consent was required to extinguish it. It is
undisputed that the FHFA did not provide this consent. We further reject as
unsupported Saticoy Bay’s argument that Bank of America failed to establish with
sufficient documentary proof Freddie Mac’s interest in the property.
2. Saticoy Bay’s argument that Nevada’s statute of frauds invalidates
Freddie Mac’s interest is “foreclosed by binding precedent,” which recognizes that
“the defense of the statute of frauds is personal, and available only to the contracting
parties or their successors in interest.” Millikan, 996 F.3d at 957 (quoting Harmon
v. Tanner Motor Tours, 377 P.2d 622, 628 (Nev. 1963)). Saticoy Bay objects that
prior cases involved different provisions, but the holdings in these prior cases were
not limited to the specific statutes at issue. See, e.g., Easton Bus. Opportunities, Inc.
v. Town Exec. Suites, 230 P.3d 827, 832 n.4 (Nev. 2010) (describing this as the
“general law” applying to “statute of frauds provisions”). Thus, given that the
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contracting parties were either Freddie Mac and Countrywide Home Loans (for the
loan interest) or Freddie Mac and Bank of America (for the title interest), Saticoy
cannot raise the statute of frauds defense.
3. Saticoy’s argument that it is protected as a bona fide purchaser also
fails. Saticoy Bay was not a bona fide purchaser, see Millikan, 996 F.3d at 957–58,
and the Federal Foreclosure Bar would preempt Nevada’s bona fide purchaser rules
if they purported to allow the extinguishment of Freddie Mac’s interest in the
property. See 12 U.S.C. § 4617(j)(3); Nationstar Mortg., LLC v. Guberland LLC-
Series 3, 420 P.3d 556 n.3 (Nev. 2018) (unpublished table decision) (“[T]here is
some recent authority suggesting that the Federal Foreclosure Bar would preempt
Nevada’s law on bona fide purchasers.”).1
AFFIRMED.
1
We may consider the Nevada Supreme Court’s unpublished decisions to the extent
they “may lend support to a conclusion as to what the Nevada Supreme Court would
hold in a published decision.” U.S. Bank, N.A. v. White Horse Ests. Homeowners
Ass’n, 987 F.3d 858, 863 (9th Cir. 2021) (quotations and alterations omitted).
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