Court Opinion

ID: 2644234
Source: CourtListenerOpinion
Date Created: 2013-11-26 21:06:21.487456+00
Date Added: 2024-06-11T12:35:22.752469
License: Public Domain

FILED
                            NOT FOR PUBLICATION                               NOV 26 2013

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

                            FOR THE NINTH CIRCUIT

TAE-SI KIM; et al.,                              No. 12-15959

              Plaintiffs - Appellants,           D.C. No. 2:09-cv-02008-PMP-
                                                 GWF
  v.

ADAM B. KEARNEY; et al.,                         MEMORANDUM*
CHARLES M. DAMUS, Esq.; et al.,

              Defendants,

  And

CUMORAH CREDIT UNION, a Nevada
non-profit corporation,

              Defendant - Appellee.

                   Appeal from the United States District Court
                            for the District of Nevada
                  Philip M. Pro, Senior District Judge, Presiding

                          Submitted November 8, 2013**
                            San Francisco, California

        *
             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).
Before: FARRIS, BLACK***, and IKUTA, Circuit Judges.

      Tae-Si Kim & Jin-Sung Hong appeal from the district court’s grant of

summary judgment in favor of Cumorah Credit Union in Kim & Hong’s action

alleging quiet title and slander of title claims that stem from Cumorah’s foreclosure

of a piece of property. We have jurisdiction under 28 U.S.C. § 1291.

      We affirm the district court’s decision that Kim & Hong’s quiet title claim

was untimely. It was not filed within the statutorily specified 90 day window.

Under Nevada law, a foreclosure sale “vests in the purchaser the title of the grantor

and any successors in interest without equity or right of redemption.” Nev. Rev.

Stat. § 107.080(5). In order to set aside a foreclosure sale, plaintiffs must

commence an action within 90 days of the date of the sale. Nev. Rev. Stat. Ann. §

107.080 (5)

      The foreclosure sale occurred on April 13, 2009. Kim & Hong filed a

complaint on October 15, 2009, after expiration of the required 90 day window.

They argue that N.R.S. § 107.080 only covers quiet title claims by the actual debtor

and does not include quiet title claims by a non-debtor/mortgagee. The statute

        ***
            The Honorable Susan H. Black, Senior Circuit Judge for the U.S.
Court of Appeals for the Eleventh Circuit, sitting by designation.
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states, however, that a foreclosure sale “vests in the purchaser the title of the

grantor and any successors in interest without equity or right of redemption.”

N.R.S. § 107.080(5). Thus, the statutory text does not support this distinction.

Nevada courts have interpreted this language to hold that a foreclosure sale

terminates all other legal and equitable interests in the land. Charmicor, Inc. v.

Bradshaw Fin. Co., 92 Nev. 310, 313, 550 P.2d 413 (Nev. 1976) (legal interest);

McCall v. Carlson, 63 Nev. 390, 406-07, 172 P.2d 171 (Nev. 1946) (equitable

interest). Plaintiffs failed to file their claim within the required 90 day period as

necessary to preserve their interest.

      We affirm the district court’s decision that Kim & Hong’s slander of title

claim fails. They were not good faith purchasers of the foreclosed property. Under

Nevada law, a slander of title claim requires that a plaintiff “establish that the

words spoken were false, that they were maliciously spoken, and that the plaintiff

sustained some special pecuniary damages as a direct and natural result of their

having been spoken.” Summa Corp. v. Greenspun, 96 Nev. 247, 254, 607 P.2d
569, 573 (Nev. 1980). Kim & Hong argue that their status as good faith purchasers

means that various statements made by Cumorah during the foreclosure were

falsehoods.

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      They, however, were not good faith purchasers. They had actual notice of

Cumorah’s interest in the land. Under Nevada law, a subsequent purchaser of a

property is not a purchaser in good faith if he or she has either actual or

constructive notice “of an interest in the land superior to that which he is

purchasing” and is “not entitled to the protection of the recording act.” Allison

Steel Mfg. Co. v. Bentonite, Inc., 86 Nev. 494, 499, 471 P.2d 666, 669 (Nev. 1970).

Actual notice is determined based on the knowledge of the proposed bona fide

purchaser prior to actual payment. Moore v. De Bernardi, 47 Nev. 33, 220 P. 544,

547 (Nev. 1923). Kim & Hong had actual notice of Cumorah’s instrument prior to

their exercise of the purchase option as evidenced by the FATCO documentation

and their questioning of Kearney about the status of the loan. Cumorah’s

statements made during the foreclosure process were not falsehoods since Kim &

Hong were not purchasers in good faith.

      Kim & Hong also argue that Cumorah’s failure to respond to the first

amended complaint constituted an admission of all of the allegations contained in

that complaint. This argument was not raised before the district court and is

therefore waived. Romain v. Shear, 799 F.2d 1416, 1419 (9th Cir. 1986).

AFFIRMED.

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