Snyder v. Clear Recon Corp. ( 2022 )

IN THE SUPREME COURT OF THE STATE OF NEVADA
NATHAN SNYDER; AND SAMANTHA No. 82390
ORR,
Appellants,
vs. FILE
CLEAR RECON CORP., AND SANAM
LIMITED,
Res • ondents.
ORDER OF AFFIRMANCE
This is an appeal from a final judgment in a real property
matter. Eighth Judicial District Court, Clark County; Eric Johnson,
Judge.'
Appellants purchased a home, funded by a mortgage loan, on
which they later defaulted. Respondent Clear Recon Corp. recorded a notice
of default in March 2019 and a notice of trustee sale thereafter. Appellants
then filed for bankruptcy and, after the bankruptcy's dismissal, Clear Recon
recorded another notice of sale. Appellants then again filed, and had
dismissed, another bankruptcy case, after which Clear Recon recorded a
third notice of sale. When appellants' third bankruptcy filing was
dismissed, Clear Recon proceeded with the foreclosure sale in July 2020.
Before respondent Sanam Limited recorded the trustee's deed upon sale,
appellants filed a complaint for injunctive relief, arguing that Clear Recon
had materially violated NRS 107.550 because no foreclosure sale occurred,
and more than 90 days passed between the recording of the second and third
notices of sale. The district court denied injunctive relief and granted
summary judgment in respondents' favor.
SUPREME COURT 'Pursuant to NRAP 34(f)(1), we have determined that oral argument
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Appellants argue that NRS 107.550(1) requires rescission of a
notice of default when a lender fails to complete a foreclosure sale within 90
calendar days after a notice of sale. And they argue that such recission is
required here because Clear Recon failed to conduct a foreclosure sale
within 90 days after recording the second notice of sale, regardless of the
fact that fewer than 90 days elapsed between the third notice of sale and
the foreclosure sale. As this is an issue of statutory interpretation, we
review the district court's decision de novo. See Senjab v. Alhulaibi, 137
Nev., Adv. Op. 64, 497 P.3d 618, 619 (2021).
"If [a] statute's language is clear and unambiguous, we enforce
the statute as written." Hobbs v. State, 127 Nev. 234, 237, 251 P.3d 177,
179 (2011). But, "if following the statute's apparent plain meaning results
in a meaning that runs counter to the 'spirit' of the statute, this court may
look outside the statute's language." MGM Mirage v. Nev. Ins. Guar. Ass'n,
125 Nev. 223, 228-29, 209 P.3d 766, 769-70 (2009). Similarly, "when [a]
statute is ambiguous, meaning that it is subject to more than one reasonable
interpretation . . . we [may also] look beyond the language [of the statute]
to consider its meaning in light of its spirit, subject matter, and public
policy." Id. (fourth alteration in original) (internal quotation marks
omitted); see also State v. Lucero, 127 Nev. 92, 95, 249 P.3d 1226, 1228
(2011) (explaining that when a statute is ambiguous, this court may then
look to legislative history and construe the statute in a manner consistent
with reason and public policy).
NRS 107.550(1) provides:
1. A civil action for a foreclosure sale
pursuant to NRS 40.430 involving a failure to make
a payment required by a residential mortgage loan
must be dismissed without prejudice, any notice of
default and election to sell recorded pursuant to
SUPREME COURT subsection 2 of NRS 107.080 or any notice of sale
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recorded pursuant to subsection 4 of NRS 107.080
must be rescinded, and any pending foreclosure
sale must be cancelled, if:
(c) A foreclosure sale is not conducted within
90 calendar days after a notice of sale is recorded
pursuant to subsection 4 of NRS 107.080.
Appellants present a reasonable reading of the statute, under
which a violation of the foreclosure process occurs when a foreclosure sale
does not occur within 90 days after a notice of sale is recorded. And here,
even accounting for NRS 107.550(2)'s tolling periods, the foreclosure sale
was not conducted within 90 calendar days after the second notice of sale.2
Nevertheless, we conclude that NRS 107.550(1) is ambiguous as applied in
this case, where a foreclosure sale occurred within 90 days of the most
recent recorded notice of sale, but more than 90 days passed between notice
of sale recordings. The district court reasonably interpreted the statute as
requiring a recission of the notice of default only where a foreclosure sale
occurs more than 90 days after the recording of a notice of sale, and because
the sale took place within 90 days of the recording of the third notice of sale,
the court concluded that the sale met the statute's requirements. Because
the statute is ambiguous, we look beyond its language to determine its
meaning. Hobbs, 127 Nev. at 237, 251 P.3d at 179.
NRS 107.550 is part of the "the Nevada Homeowner's Bill of
Rights." Relevant legislative history shows that the bill's sponsors intended
to provide homeowners with adequate notice and certainty regarding
foreclosure proceedings and with information on ways to avoid foreclosure.
Hearing on S.B. 321 Before the Assemb. Comm. on Judiciary, 77th Leg.
2 Respondents dispute that more than 90 days elapsed between the
SUPREME COURT second and third notice of sale, but the record belies this contention.
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(May 2, 2013) (testimony of Assemblyman James Healey) (testifying that
the bill was intended to "protect . . . homeowners" by "requir[ing] borrowers
to be sent a foreclosure notice, a preforeclosure notice with information
about their loan, and options on how to avoid foreclosure"); Hearing on S.B.
321 Before the Senate Judiciary Comm., 77th Leg. (April 10, 2013)
(testirnony of Senator Justin Jones) (noting that the bill addressed the
concern that foreclosure notices would "sit out forever" and that the bill
would "increase [ ] predictability for all parties involved in the foreclosure
process," and provide "strong but fair accountability measures by extending
protections to all residential mortgages written in Nevada"). The sponsors
were also aware of the potential for abuse by homeowners in default,
though, stating that it was "not the intent of the bill" to give "those who go
through this process the ability to abuse the process." Hearing on S.B. 321
Before the Assembly Comm. on Judiciary 77th Leg. (May 16, 2013)
(testimony of Senator Justin Jones). Sponsors further stated that they had
worked with various stakeholders
to make sure that we are not enabling people who
are simply trying to game the system. I think what
we have done is ensure that there is notice at the
beginning and that there is an opportunity for
someone to go into either the foreclosure mediation
process or into another loss mitigation process.
Hearing on S.B. 321 Before the Assembly Comm. on Judiciary 77th Leg.
(May 2, 2013) (testimony of Senator Jones).
Based on the legislative history, we conclude that Clear Recon
did not violate the statute because it did not conduct a foreclosure sale more
than 90 days after recording a notice of sale. This interpretation balances
the bill sponsors' concerns that homeowners were not receiving sufficient
notice about the foreclosure proceedings with their countervailing concern
SUPREME COURT that homeowners could potentially abuse the process.
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Here, appellants do not dispute that they received all due notice
regarding the foreclosure proceedings, which is further evidenced by their
bankruptcy petitions filed immediately before, or on the day of, each of the
scheduled foreclosure sales. Most importantly, they do not dispute that
they had notice as to the third notice of sale. And they also do not dispute
that the foreclosure sale occurred within 90 days after the third notice of
sale.3 For these reasons, we conclude that the district court did not err by
granting summary judgment and denying injunctive relief. We, therefore,
ORDER the judgment of the district court AFFIRMED. 4
J. Sr.J.
Silver
cc: Hon. Eric Johnson, District Judge
Kristine M. Kuzemka, Settlement Judge
Kern Law, Ltd.
Law Office of Andrew H. Pastwick, LLC
Aldridge Pite, LLP
Eighth District Court Clerk
this issue is dispositive, we need not address the parties'
3 Because
remaining arguments regarding NRS 107.560 and whether respondent
Sanam Limited was a bona fide purchaser.
lift the stay imposed by this court on June 10, 2021 (as clarified
4We
by order entered on January 3, 2022).
The Honorable Mark Gibbons, Senior Justice, participated in the
SUPREME COURT decision of this matter under a general order of assignment.
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