Saticoy Bay Llc Ser. 8149 Palace Monaco v. Wells Fargo Bank, Nat'L Ass'N ( 2022 )

Supreme Court
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Nevapa
(O) 187A thE
IN THE SUPREME COURT OF THE STATE OF NEVADA
SATICOY BAY LLC SERIES 8149 No. 81453
PALACE MONACO,
Appellant,
vs.
WELLS FARGO BANK, NATIONAL F E . E Dp
ASSOCIATION, AS TRUSTEE FOR
THE STRUCTURED ADJUSTABLE
RATE MORTGAGE LOAN TRUST,
PASS-THROUGH CERTIFICATES
SERIES 2005-11,
Respondent.
ORDER OF REVERSAL AND REMAND
This is an appeal from a district court order granting summary
judgment, certified as final under NRCP 54(b), in an action to quiet title.
Eighth Judicial District Court, Clark County; Ronald J. Israel, Judge.!
The district court granted summary judgment for respondent,
concluding that the first deed of trust survived the HOA’s 2013 foreclosure
sale. As the basis for its conclusion, the district court found that respondent
produced evidence showing that the former homeowner made payments on
his outstanding balance and that the HOA’s agent allocated those payments
to the superpriority portion of the HOA’s lien, thereby curing the default as
1Pursuant to NRAP 34(f)(1), we have determined that oral argument
is not warranted in this appeal.
Z22-) 6024
Supreme Court
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Nevapa
(0) 19974 136 Nev. 76, 78-80, 459 P.3d 227, 230-31 (2020) (holding
that a homeowner, and not just a first deed of trust beneficiary, can cure a
superpriority default so long as the homeowner's payments are allocated to
that portion of the HOA’s lien).
Appellant contends that reversal is warranted because (1)
respondent did not produce sufficient evidence showing that the
homeowner’s payments were allocated to the superpriority portion of the
HOA’s lien, (2) appellant was protected as a bona fide purchaser, or (3)
respondent’s 2018 quiet title counterclaim was time-barred. We disagree
with appellant’s first two arguments but conclude that remand is necessary
to determine whether respondent’s counterclaim was timely.”
With respect to appellant’s first argument, respondent contends
that it produced evidence in the form of “Payoff Allocation Report([s]” from
the HOA’s agent showing that the agent allocated the homeowner's
payments to the superpriority portion of the HOA’s lien. And to combat
appellant’s sole argument in district court that respondent needed to
produce evidence directly from the HOA showing how the HOA would have
allocated the payments, respondent relied on the HOA’s interrogatory
responses wherein it stated that it in essence deferred to its agent’s
allocation policy. We conclude that this evidence is sufficient to show that
the HOA chose to allocate the homeowner's payments to the superpriority
2In light of these conclusions, we need not address the parties’
remaining arguments.
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portion of the HOA’s lien.? See Cranesbill, 136 Nev. at 80-81, 459 at 231-32
(recognizing that if the debtor does not choose how to allocate the payments,
the creditor has the right to choose how to allocate the payments).
With regard to appellant’s second argument that it is a bona
fide purchaser and that evidence of the payment needed to be recorded, we
recently reiterated that those arguments are inapposite because satisfying
the superpriority portion of an HOA’s lien preserves a first deed of trust as
a matter of law and does not constitute a “conveyance” that needs to be
recorded.’ See Saticoy Bay LLC Series 133 McLaren v. Green Tree Servicing
LLC, 136 Nev., Adv. Op. 85, 478 P.3d 376, 379 (2020) (“While a court’s
authority to look beyond a foreclosure deed in a quiet title action is an
inherent equitable power, a valid superpriority tender cures a default ‘by
operation of law’—that is, without regard to equitable considerations.”
(Gnternal citation omitted)); id. (rejecting the argument that evidence of a
tender needs to be recorded because “[t]endering the superpriority portion
3For the first time on appeal, appellant contends that the agent’s
allocation contradicted the homeowner's choice regarding how to allocate
the payments, as is purportedly reflected in a June 2013 “Payment
Agreement” between the homeowner and the agent. Even if this argument
were not waived, see Old Aztec Mine, Inc. v. Brown, 97 Nev. 49, 52, 623 P.2d
981, 983 (1981), it lacks merit because the homeowner’s May 2013 payment
shown on the agent’s May 2013 “Payment Allocation Report” preceded the
June 2013 “Payment Agreement” and was itself sufficient to satisfy the
superpriority portion of the HOA’s lien.
4To the extent appellant suggests that this holding somehow
contradicts the foreclosure deed’s recital that there was a “default,” we note
that this recital remains accurate even after the superpriority default has
been cured because the subpriority portion of an HOA’s lien remains in
default.
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of an HOA lien does not create, alienate, assign, or surrender an interest in
land” (quoting Bank of Am., N.A. v. SFR Invs, Pool 1, LLC, 134 Nev. 604,
609, 427 P.3d 113, 119 (2018))). Accordingly, the district court correctly
determined that the superpriority portion of the HOA’s lien was satisfied
before the foreclosure sale.
With regard to appellant’s third argument, we recently held in
U.S. Bank, N.A. v. Thunder Properties, Inc., 138 Nev., 503 P.3d 299 (2022),
that NRS 11.220’s four-year limitations period governs a deed of trust
beneficiary's quiet title claim in situations such as in this case. We further
held that an HOA’s foreclosure sale itself is not sufficient to trigger the
limitations period and that, instead, “the statute of limitations should not
run against a lienholder until it has something closely analogous to ‘notice
of disturbed possession,’ such as repudiation of the lien.” Jd. at 306 (quoting
Berberich v. Bank of Am., N.A., 1386 Nev. 93, 97, 460 P.3d 440, 443 (2020)).
Thus, under Thunder Properties, we are unable to determine as a matter of
law whether respondent’s 2018 counterclaim challenging the effect of the
HOA’s 2013 foreclosure sale was timely. Cf. Winn v. Sunrise Hosp. & Med.
Ctr., 128 Nev. 246, 253, 277 P.3d 458, 463 (2012) (“The appropriate accrual
date for the statute of limitations is a question of law only if the facts are
uncontroverted.” (internal alteration and quotation marks omitted)).
Accordingly, we reverse the district court’s judgment in favor of respondent
and remand for consideration of appellant’s statute-of-limitations argument
in light of Thunder Properties. Consistent with the foregoing, we
Supreme Court
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NeEvapa
10) IN7A GRBR
ORDER the judgment of the district court REVERSED AND
REMAND this matter to the district court for proceedings consistent with
this order.®
Ce ls 5
Parraguirre
Ae. kav, _d. She. J.
Hardesty Gibbons
ec: Hon. Ronald J. Israel, District Judge
TRILAW
Law Offices of Michael F. Bohn, Ltd.
Troutman Pepper/Atlanta
Wright, Finlay & Zak, LLP/Las Vegas
Eighth District Court Clerk
5The Honorable Mark Gibbons, Senior Justice, participated in the
decision of this matter under a general order of assignment.