Court Opinion

ID: 2779734
Source: CourtListenerOpinion
Date Created: 2015-02-17 21:01:02.915439+00
Date Added: 2024-06-11T10:55:52.152680
License: Public Domain

FILED
                           NOT FOR PUBLICATION                               FEB 17 2015

                                                                         MOLLY C. DWYER, CLERK
                    UNITED STATES COURT OF APPEALS                        U.S. COURT OF APPEALS

                            FOR THE NINTH CIRCUIT

JERRY SCOTT and BRIDGETT SCOTT,                  No. 13-15129

              Plaintiffs - Appellants,           D.C. No. 2:10-cv-02081-GMN-
                                                 RJJ
  v.

MORTGAGE ELECTRONIC                              MEMORANDUM*
REGISTRATION SYSTEMS, INC.; et al.,

              Defendants - Appellees.

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

                          Submitted February 11, 2015**
                             San Francisco, California

Before: THOMAS, Chief Judge, and McKEOWN and W. FLETCHER, Circuit
Judges.

        *
             This disposition is not appropriate for publication and is not precedent
except as provided by 9th Cir. R. 36-3.
        **
             The panel unanimously concludes this case is suitable for decision
without oral argument. See Fed. R. App. P. 34(a)(2).
      Bridgett and Jerry Scott appeal the district court’s order dismissing their

claims for quiet title and wrongful foreclosure under Federal Rule of Civil

Procedure 12(b)(6). We have jurisdiction under 28 U.S.C. § 1291. We review the

order of dismissal de novo and “may affirm the district court’s dismissal on any

ground supported by the record.” ASARCO, LLC v. Union Pac. R.R. Co., 765 F.3d

999, 1004 (9th Cir. 2014). We affirm the district court’s order in part and reverse

it in part. Because the parties are familiar with the factual and legal history of the

case, we need not recount it here.

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      Section 40.010 of the Nevada Revised Statutes provides that an action for

quiet title “may be brought by any person against another who claims an estate or

interest in real property, adverse to the person bringing the action, for the purpose

of determining such adverse claim.” Although 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.” Chapman v. Deutsche Bank Nat'l Trust Co.,

302 P.3d 1103, 1106 (Nev. 2013) (citations and quotation marks omitted). The

“plaintiff’s right to relief therefore depends on superiority of title.” Id.

      In their second amended complaint, the Scotts alleged that the deed of trust

encumbering their property – a deed purportedly held by defendants – was invalid

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and, thus, could not be used to foreclose on the property. Specifically, the Scotts

alleged that defendants obtained the deed of trust from their cousin, Katrina Noble,

who never lawfully held title to the property. The Scotts further alleged that Noble

forged certain documents, without the Scotts’ knowledge or permission, which

enabled her to take out a loan secured by the Scotts’ property. These detailed

factual allegations suggest that the Scotts may have superior title to the subject

property and, thus, are sufficient to state a claim for quiet title.

       Nevertheless, the district court dismissed the Scotts’ quiet title claim because

their complaint failed to set forth the specific “legal theory, statutory basis or

common law basis” for the claim. However, the Supreme Court has made clear

that, “under the Federal Rules of Civil Procedure, a complaint need not pin

plaintiff’s claim for relief to a precise legal theory” to survive a motion to dismiss.

Skinner v. Switzer, 131 S. Ct. 1289, 1296 (2011) (reversing dismissal of due

process claim under Rule 12(b)(6) even though the complaint failed to articulate a

clear due process theory). We have likewise held that a plaintiff “does not need to

plead specific legal theories in the complaint, as long as the opposing party

receives notice as to what is at issue in the lawsuit.” Pruitt v. Cheney, 963 F.2d

1160, 1164 (9th Cir. 1991) (citations and quotation marks omitted); see also

Fontana v. Haskin, 262 F.3d 871, 877 (9th Cir. 2001) (“Specific legal theories

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need not be pleaded so long as sufficient factual averments show that the claimant

may be entitled to some relief.”). In this case, the Scotts’ factual allegations

sufficed to give defendants notice of exactly what was at issue in this lawsuit –

namely, the validity of the deed of trust.

      The Scotts’ failure to identify a specific “statutory basis or common law

basis” for the quiet title claim in their complaint was also not a proper ground for

dismissal. A “complaint need not identify the statutory or constitutional source of

the claim raised in order to survive a motion to dismiss.” Alvarez v. Hill, 518 F.3d

1152, 1157 (9th Cir. 2008); see also Sagana v. Tenorio, 384 F.3d 731, 737 (9th

Cir. 2004) (“We long ago rejected the argument that a specific statute must be

named, describing it as an ‘attempt to evoke wholly out-moded technical pleading

rules.’” (quoting Bowers v. Campbell, 505 F.2d 1155, 1157 n.2 (9th Cir. 1974))).

      Finally, although defendants argue that the Scotts’ quiet title claim is time-

barred, this argument is not persuasive. The statute of limitations for quiet title

claims in Nevada is five years. Nev. Rev. Stat. §§ 11.070, 11.080. The Scotts filed

the instant action in October 2010. The earliest date on which the Scotts could

have filed this quiet title action was four years earlier, in November 2006, when

Noble allegedly first recorded the property in her name using the forged deed.

Thus, the Scotts filed this action well within the applicable limitations period.

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                                           II

      We need not determine whether the district court should have dismissed the

Scotts’ wrongful foreclosure claim for pleading deficiencies because we can affirm

the dismissal of the claim on other grounds.

       “An action for the tort of wrongful foreclosure will lie if the trustor or

mortgagor can establish that at the time the power of sale was exercised or the

foreclosure occurred, no breach of condition or failure of performance existed on

the mortgagor’s or trustor’s part . . . .” Collins v. Union Fed. Sav. & Loan Ass’n,

662 P.2d 610, 623 (Nev. 1983). In this case, the Scotts failed to allege that the

trustor – namely, Noble – actually complied with the terms of her loan agreement.

To the contrary, the Scotts attached an exhibit to their complaint which indicates

that Noble did, in fact, breach certain repayment obligations under her loan

agreement. Therefore, the dismissal of the Scotts’ wrongful foreclosure claim was

proper. Because the Scotts’ prior pleading indicates that Noble breached her loan

repayment obligations, any attempt to amend this claim would be futile.

      Accordingly, we reverse the dismissal of the Scotts’ quiet title claim and

affirm the dismissal with prejudice of their wrongful foreclosure claim. Each party

shall bear their own costs on appeal.

      AFFIRMED IN PART and REVERSED IN PART.

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