Court Opinion

ID: 5132998
Source: CourtListenerOpinion
Date Created: 2021-12-08 21:00:34.628354+00
Date Added: 2024-06-11T08:23:33.418821
License: Public Domain

NOT FOR PUBLICATION                          FILED
                    UNITED STATES COURT OF APPEALS                        DEC 8 2021
                                                                      MOLLY C. DWYER, CLERK
                                                                       U.S. COURT OF APPEALS
                            FOR THE NINTH CIRCUIT

FEDERAL NATIONAL MORTGAGE                       No.    20-16359
ASSOCIATION,
                                                D.C. No.
      Plaintiff-counter-                        2:17-cv-02051-APG-EJY
      defendant-Appellee,

and                                             MEMORANDUM*

FULTON PARK UNIT OWNERS
ASSOCIATION,

      Defendant-cross-defendant-
      Appellee,

 v.

SATICOY BAY LLC SERIES 8324
CHARLESTON,

      Defendant-counter-claimant-
      cross-claimant-Appellant.

                   Appeal from the United States District Court
                            for the District of Nevada
                   Andrew P. Gordon, District Judge, Presiding

                          Submitted December 6, 2021**

      *
             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).
                            San Francisco, California

Before: WARDLAW, BRESS, and BUMATAY, Circuit Judges.

      Saticoy Bay LLC Series 8324 Charleston (“Saticoy Bay”) appeals the district

court’s grant of summary judgment to the Federal National Mortgage Association

(“Fannie Mae”) and the Fulton Park Unit Owners Association (“HOA”) on Fannie

Mae’s claim to quiet title for property located at 8324 West Charleston Boulevard

in Las Vegas, Nevada (“property”). We have jurisdiction under 28 U.S.C. § 1291.

Reviewing de novo, CitiMortgage, Inc. v. Corte Madera Homeowners Ass’n, 962

F.3d 1103, 1106 (9th Cir. 2020), we affirm.

      The parties do not dispute that Fannie Mae purchased the property owner’s

loan, including the deed of trust, prior to the HOA foreclosure auction at which

Saticoy Bay purchased the property. The Federal Foreclosure Bar thus applies and

prevents the foreclosure sale from extinguishing Fannie Mae’s deed of trust. See 12

U.S.C. § 4617(j)(3); Nationstar Mortg. LLC v. Saticoy Bay LLC, Series 9229

Millikan Ave., 996 F.3d 950, 958 (9th Cir. 2021). Saticoy Bay argues that the

foreclosure sale should nonetheless be voided because the HOA allegedly had a duty

to provide notice that it had not obtained consent to the foreclosure sale from the

Fair Housing Finance Association (“FHFA”). But the HOA did not owe Saticoy

Bay any such duty.

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       Federal law does not impose the duty Saticoy Bay seeks. The Federal

Foreclosure Bar does not contain any notice requirement. See Fed. Home Loan Mtg.

Corp. v. SFR Inv. Pool 1, LLC, 893 F.3d 1136, 1151 (9th Cir. 2018). Nor does Nev.

Rev. Stat. § 116.1113, which imposes a duty of good faith on contracts under

Chapter 116, require notice. At the time of the sale, Nevada law required the HOA

to deliver “a deed without warranty.” Nev. Rev. Stat. § 116.31164(3)(a) (amended

2015). The HOA did so. Saticoy Bay’s proposed duty would have effectively

required the HOA to warrant that there was a superior federal interest, contrary to

the statute.

       The Nevada Supreme Court has also rejected Saticoy Bay’s argument in

multiple unpublished decisions, explaining that

       to the extent that [plaintiff] seeks to base this claim on NRS 116.1113,
       we note that nothing in the applicable version of NRS 116.3116-.3117
       imposes a duty on an HOA to disclose whether the loan secured by the
       first deed of trust is federally owned or to seek the federal entity’s
       consent to foreclose.

LN Mgmt. LLC Series 356 Desert Inn 206 v. Desert Inn Villas Homeowners’ Ass’n,

478 P.3d 872 (Nev. 2021) (unpublished); see also Tallard CT Tr. v. Southern

Highlands Cmty. Ass’n, 478 P.3d 870 (Nev. 2021) (unpublished) (same).1

1
  Nevada’s unpublished opinions may be considered to the extent that they “may
lend support to a conclusion as to what the Nevada Supreme Court would hold in a
published decision.” U.S. Bank, N.A. v. White Horse Ests. Homeowners Ass’n, 987
F.3d 858, 863 (9th Cir. 2021) (quotations and alterations omitted).

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Moreover, that the foreclosure sale was conducted pursuant to § 116 does not mean

Saticoy Bay could reasonably expect the sale to be a superpriority foreclosure, let

alone that the HOA had a duty to disclose that it had not obtained the FHFA’s

consent to foreclose.

      Saticoy Bay also argues that the foreclosure sale should be voided because it

resulted in an improper windfall for Fannie Mae. Saticoy Bay did not preserve this

argument in the district court. Absent exceptional circumstances, we will not

consider arguments raised for the first time on appeal. In re Am. W. Airlines, Inc.,

217 F.3d 1161, 1165 (9th Cir. 2000). Regardless, the argument fails. Both before

and after the foreclosure sale, Fannie Mae’s potential recovery was limited to the

amount remaining on the original loan; Fannie Mae had not received payments on

the loan for years; and Saticoy Bay had obtained the property at a substantially

below-market price and was able to collect rent on the property for a substantial

period. The equities thus do not favor voiding the foreclosure sale.

      AFFIRMED.

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