Court Opinion

ID: 4525274
Source: CourtListenerOpinion
Date Created: 2020-04-14 21:00:39.360584+00
Date Added: 2024-06-11T12:12:03.848865
License: Public Domain

NOT FOR PUBLICATION                           FILED
                    UNITED STATES COURT OF APPEALS                        APR 14 2020
                                                                      MOLLY C. DWYER, CLERK
                                                                       U.S. COURT OF APPEALS
                           FOR THE NINTH CIRCUIT

CHRISTIANA TRUST, a Division of                 No.    19-15096
Wilmington Savings Fund Society, FSB, not
in its individual capacity but as Trustee of    D.C. No.
ARLP Trust 3,                                   2:16-cv-00684-GMN-CWH

                Plaintiff-Appellee,
                                                MEMORANDUM*
 v.

SFR INVESTMENTS POOL 1, LLC,

                Defendant-Appellant,

and

THE PRESERVE HOMEOWNERS
ASSOCIATION; ALESSI & KOENIG,
LLC,

                Defendants.

                   Appeal from the United States District Court
                            for the District of Nevada
                   Gloria M. Navarro, District Judge, Presiding

                            Submitted March 30, 2020**
                               Pasadena, California

      *
             This disposition is not appropriate for publication and is not precedent
except as provided by Ninth Circuit Rule 36-3.
      **
             The panel unanimously concludes this case is suitable for decision
without oral argument. See Fed. R. App. P. 34(a)(2).
Before: MURGUIA and MILLER, Circuit Judges, and STEEH,*** District Judge.

      Appellant SFR Investments Pool 1, LLC (“SFR”) appeals the district court’s

order granting summary judgment to Appellee Christiana Trust (“Christiana”). We

have jurisdiction pursuant to 28 U.S.C. § 1291 and, on de novo review, we vacate

the summary judgment and remand with instructions to dismiss the action without

prejudice for lack of standing. Because the parties are familiar with the facts, we

recite only those necessary to resolve the issues on appeal.

      “No principle is more fundamental to the judiciary’s proper role in our

system of government than the constitutional limitation of federal-court

jurisdiction to actual cases or controversies.” Raines v. Byrd, 521 U.S. 811, 818

(1997) (quoting Simon v. E. Ky. Welfare Rights Org., 426 U.S. 26, 37 (1976)).

Consistent with this checks and balances principle, a private party can bring a

“case” only if it has standing, defined as “a concrete and particularized injury that

is fairly traceable to the challenged conduct, and is likely to be redressed by a

favorable judicial decision.” Hollingsworth v. Perry, 570 U.S. 693, 704 (2013)

(citing Lujan v. Defenders of Wildlife, 504 U.S. 555, 560–61 (1992)).

      There is no dispute that Christiana bears the burden of establishing it has

      ***
             The Honorable George Caram Steeh III, United States District Judge
for the Eastern District of Michigan, sitting by designation.

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standing to sue and that “[t]he existence of federal jurisdiction ordinarily depends

on the facts as they exist when the complaint is filed.” Newman-Green, Inc. v.

Alfonzo-Larrain, 490 U.S. 826, 830 (1989) (emphasis added); see also Friends of

the Earth, Inc. v. Laidlaw Envtl. Servs. (TOC), Inc., 528 U.S. 167, 189 (2000)

(standing “must exist at the commencement of the litigation” (quoting Arizonans

for Official English v. Arizona, 520 U.S. 43, 68 n.22 (1997) (emphasis added)));

Mollan v. Torrance, 22 U.S. 537, 539 (1824) (“[J]urisdiction . . . depends upon the

state of things at the time the action is brought.” (emphasis added)).

       The district court erred in assuming jurisdiction over this action because

Christiana lacked any valid interest in the deed of trust when the complaint was

filed on March 29, 2016. The record establishes that Mortgage Electronic

Registration Systems, Inc. (“MERS”) assigned all its beneficial interest under the

deed of trust to BAC Home Loans Servicing, LP (“BAC”) on January 28, 2011.

Over three years later, on April 10, 2014, MERS again assigned and transferred all

its beneficial interest in the deed of trust to Ocwen Loan Servicing (“Ocwen”),

who in turn assigned and transferred the interest to Christiana five days later, on

April 15, 2014. But MERS had no interest left to assign to Ocwen in 2014, which

means that the assignments from MERS to Ocwen and from Ocwen to Christiana

were invalid. These unusual circumstances made it so that, at the time the lawsuit

was filed in 2016, only BAC—not Christiana—owned a legally enforceable

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interest deed of trust. In other words, Christiana did not have an interest in the

property at the time it filed its complaint, and it therefore lacked standing. See Res.

Grp., LLC v. Nev. Ass’n Servs., Inc., 437 P.3d 154, 157–58 (Nev. 2019)

(“[B]ecause [a] plea to quiet title does not require any particular elements, . . . each

party must plead and prove his or her own claim to the property in question.”

(citations omitted)). Accordingly, the district court erred in exercising jurisdiction

over this case. On remand, the district court is instructed to dismiss the complaint

without prejudice. See Fleck and Assocs., Inc. v. City of Phx., 471 F.3d 1100,

1106–07 (9th Cir. 2006) (dismissing action without prejudice because district court

lacked standing over the entirety of the plaintiff’s complaint).

      VACATED AND REMANDED WITH INSTRUCTIONS.

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