Court Opinion

ID: 7801202
Source: CourtListenerOpinion
Date Created: 2022-08-17 10:07:32.93475+00
Date Added: 2024-06-11T16:29:14.849011
License: Public Domain

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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