Court Opinion

ID: 4708460
Source: CourtListenerOpinion
Date Created: 2021-08-02 21:00:37.566684+00
Date Added: 2024-06-11T08:06:50.780244
License: Public Domain

FILED
                           NOT FOR PUBLICATION
                                                                               AUG 2 2021
                    UNITED STATES COURT OF APPEALS                         MOLLY C. DWYER, CLERK
                                                                            U.S. COURT OF APPEALS

                            FOR THE NINTH CIRCUIT

U.S. BANK, N.A., Trustee for the Holders         No.   19-15918
of the J.P. Morgan Mortgage Trust 2007-
S3,                                              D.C. No.
                                                 2:15-cv-01484-KJD-GWF
              Plaintiff-counter-
              defendant-Appellant,
                                                 MEMORANDUM*
 v.

SOUTHERN HIGHLANDS
COMMUNITY ASSOCIATION,

              Defendant-Appellee,

SFR INVESTMENTS POOL 1, LLC,

              Defendant-counter-claimant-
              cross-claimant-Appellee,

  v.

NATIONSTAR MORTGAGE LLC;
BANK OF AMERICA, NA,

              Cross-claim-defendants-
              Appellants.

       *
             This disposition is not appropriate for publication and is not precedent
except as provided by Ninth Circuit Rule 36-3.
                    Appeal from the United States District Court
                             for the District of Nevada
                     Kent J. Dawson, District Judge, Presiding

                      Argued and Submitted February 5, 2021
                       Submission Withdrawn June 3, 2021
                           Resubmitted August 2, 2021
                            San Francisco, California

Before: SILER,** IKUTA, and NGUYEN, Circuit Judges.

      U.S. Bank appeals the district court’s grant of summary judgment in favor of

Southern Highlands Community Association (Southern Highlands) and SFR

Investments Pool 1 (SFR). The district court had jurisdiction under 18 U.S.C.

§ 1332, and we have jurisdiction under 28 U.S.C. § 1291.

      The sale price of the property at issue in Southern Highlands’s foreclosure

sale was grossly inadequate as a matter of Nevada law because it was less than

three percent of the value of the home. See Shadow Wood Homeowners Ass’n v.

N.Y. Cmty. Bancorp, Inc., 132 Nev. 49, 60 (2016) (en banc). But in order to

establish that the foreclosure sale can be equitably set aside under Nevada law,

U.S. Bank also must show that fraud, unfairness, or oppression affected the sale.

See U.S. Bank, N.A., Tr. for Banc of Am. Funding Corp. Mortg. Pass-Through

      **
            The Honorable Eugene E. Siler, United States Circuit Judge for the
U.S. Court of Appeals for the Sixth Circuit, sitting by designation.
                                          2
Certificates, Series 2005-F v. White Horse Ests. Homeowners Ass’n (White Horse),

987 F.3d 858, 863 (9th Cir. 2021) (citing Nationstar Mortg., LLC v. Saticoy Bay

LLC Series 2227 Shadow Canyon, 133 Nev. 740, 748–50 (2017)). We have held

that a mortgage protection clause in an association’s covenants, conditions, and

restrictions, without more, does not constitute fraud, unfairness, or oppression. See

id. at 864 (citing NRS §§ 116.3116(2), 116.1104), 867. To further support its

argument that the sale should be set aside, U.S. Bank also points to Southern

Highlands’s misrepresentations in a separate foreclosure proceeding. But no

Nevada decision directly supports U.S. Bank’s argument that the mortgage

protection clause and such misrepresentations, taken together, rise to the level of

fraud, unfairness, or oppression, and the Nevada Supreme Court has declined to

address this issue in a published case. See U.S. Bank, N.A., Tr. for the Holders of

the J.P. Morgan Mortg. Tr. 2007-S3 v. SFR Invs. Pool 1, LLC, 2021 WL 2646064,

at *1 (Nev. June 25, 2021). Accordingly, we conclude that U.S. Bank has failed to

raise a genuine issue of material fact that fraud, unfairness, or oppression marred

the foreclosure sale such that it can be equitably set aside.

      AFFIRMED.

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