Opinion
No. 69793
05-05-2017
RESOURCES GROUP, LLC, AS TRUSTEE OF THE ELEGANTE WAY TRUST, Appellant, v. CITIMORTGAGE, INC., A NEW YORK CORPORATION, Respondent.
ORDER REVERSING AND REMANDING
Appellant Resources Group, LLC, appeals from a district court order granting summary judgment in a quiet title action. Eighth Judicial District Court, Clark County; Kerry Louise Earley, Judge.
Respondent Citimortgage, Inc., held a first deed of trust on the subject property, which Resources Group purchased at a homeowners' association (HOA) foreclosure sale conducted pursuant to NRS Chapter 116 after the homeowner failed to pay HOA assessments. See NRS 116.3116-.31168; Saticoy Bay LLC Series 350 Durango 104 v. Wells Fargo Home Mortg., 133 Nev. ___, ___, 388 P.3d 970, 971 (2017) (recognizing that the statutory scheme grants HO As superpriority liens for unpaid assessments and allows HOAs to nonjudicially foreclosure on those liens). After Resources Group purchased the property, it filed a complaint, as is pertinent here, to quiet title to the property, which Citimortgage opposed. The district court ultimately granted summary judgment in Citimortgage's favor and this appeal followed.
In granting summary judgment, the district court determined that no questions of material fact existed that the HOA failed to effectuate service of the notice of default and election to sell on Citimortgage or its predecessor-in-interest as required by statute, and, thus concluded that Citimortgage's first deed of trust was not extinguished by the HOA foreclosure sale. But in granting summary judgment on this basis, the district court relied on a misstatement of the law, as NRS 116.31163 only requires that the notice of default and election to sell be mailed to the required parties, not that it actually be received by the required parties. See NRS 116.31163 (2015) (requiring the notices to be mailed but making no requirement that the party mailing the notices ensure that they are actually received); Turner v. Dewco Servs., Inc., 87 Nev. 14, 16, 479 P.2d 462, 464 (1971) (holding that a party complied with a foreclosure statute requiring the mailing of notices when it properly mailed the notices, despite those notices being returned as undeliverable, because the statute did "not require proof that the notice be received"). Accordingly, this was an improper basis to grant summary judgment on Resource Group's quiet title claims.
Furthermore, in Shadow Wood Homeowners Ass'n, Inc. v. New York Community Bancorp, Inc., 132 Nev. ___, ___, 366 P.3d 1105, 1114 (2016), the Nevada Supreme Court recognized that a quiet title action is equitable in nature and, as such, a court "must consider the entirety of the circumstances that bear upon the equities." In particular, the supreme court recognized that the parties must develop a record in the district court regarding certain issues, including whether the sale was commercially reasonable and whether a bona fide purchaser will be harmed by setting the sale aside. Id. at 1113-14, 1116. And here, it is possible that Citimortgage's arguments regarding a lack of notice may bear upon the equities in this matter.
Because the parties failed to develop an adequate record below and because the district court granted summary judgment in favor of Citimortgage based upon an incorrect conclusion of law and without addressing how the noted issues bore upon the equities, we conclude that summary judgment in Citimortgage's favor was not proper. Accordingly, we
ORDER the judgment of the district court REVERSED AND REMAND this matter to the district court for proceedings consistent with this order.
Citimortgage argues that summary judgment was also proper because NRS Chapter 116's statutory scheme is unconstitutional. In light of the supreme court's opinion in Saticoy Bay, 133 Nev. ___, 388 P.3d 970, Citimortgage's constitutional challenges to NRS Chapter 116 lack merit. --------
/s/_________, C.J.
Silver
/s/_________, J.
Tao
/s/_________, J.
Gibbons cc: Hon. Kerry Louise Earley, District Judge
Janet Trost, Settlement Judge
Kerry P. Faughnan
Akerman LLP/Las Vegas
Wolfe & Wyman LLP
Eighth District Court Clerk