Court Opinion

ID: 8206859
Source: CourtListenerOpinion
Date Created: 2022-09-16 10:06:04.193053+00
Date Added: 2024-06-11T16:41:20.351815
License: Public Domain

IN THE SUPREME COURT OF THE STATE OF NEVADA

                OCWEN LOAN SERVICING, LLC, A                          No. 82680
                FOREIGN LIMITED LIABILITY
                COMPANY,
                Appellant,
                vs.                                                   FILED
                CHERSUS HOLDINGS, LLC, A
                DOMESTIC LIMITED LIABILITY                            SEP 1 5 2022
                COMPANY,                                             ELIZAB TH A. BROWN
                                                                         OF   PREME cougr
                Respondent.
                                                                              CLERK

                                     ORDER AFFIRMING IN PART,
                                 REVERSING IN PART, AND REMANDING
                            This is an appeal from a district court final judgment in an
                action to quiet title. Eighth Judicial District Court, Clark County; Nadia
                Krall, Judge.'
                            In 2011, Southern Terrace Homeowners Association (the HOA)
                held a foreclosure sale after the former homeowners failed to pay their HOA
                dues. Respondent's predecessor, First 100, LLC (First 100), placed the
                winning bid at the sale for $3,500. Then in 2013, the first deed of trust
                beneficiary purported to foreclose on the first deed of trust. Appellant
                placed the winning bid at that sale and subsequently took possession of the
                property.

                       'Pursuant to NRAP 34(0(4 we have determined that oral argument
                is not warranted,

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                             In the underlying action, appellant and respondent asserted
                competing quiet title claims. Respondent further asserted counterclaims
                against appellant, which revolved around appellant having ousted
                respondent from the property.
                             In May 2019, the district court granted summary judgment for

                respondent on the competing quiet title claims.        In doing so, it rejected

                appellant's argument that a "Factoring Agreement" between First 100 and
                the HOA depressed bidding so as to amount to fraud, unfairness, or
                oppression sufficient to justify setting aside the sale. Cf. U.S. Bank, Nat'l
                Ass'n ND v. Res. Grp., LLC, 135 Nev. 199, 205-06, 444 P.3d 442, 448 (2019)
                (reaffirming that a court may set aside a foreclosure sale if the sale is
                affected by "fraud, unfairness, or oppression" and that "where the
                inadequacy [of the winning bid] is palpable and great, very slight evidence
                of unfairness or irregularity is sufficient to authorize" setting aside the sale
                (internal quotation marks omitted)).         In particular, the district court

                identified four issues that appellant raised with respect to the Factoring
                Agreement, and it concluded that none of those issues amounted to fraud,
                unfairness, or oppression by relying on deposition testimony from the HOA
                foreclosure agent's NRCP 30(b)(6) witness that explained how the Factoring

                Agreement did not lead to depressed bidding in this case.
                             The district court also granted summary judgment for
                respondent    on   its   counterclaims for    (1)   wrongful   foreclosure,   (2)

                trespass/conversion, and (3) unjust enrichment.        Thereafter, the district

                court held a prove-up hearing to establish the damages to which respondent
                was entitled for its counterclaims. Following the hearing, the district court
                entered an order in March 2021 awarding respondent roughly $77,000 in

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                    damages for its counterclaims, which represented the amount of rental
                    income respondent lost while appellant was in possession of the subject
                    property.   The district court also appears to have awarded respondent
                    $3,417 in costs.2
                                Appellant first challenges the district court's finding that there
                    was no fraud, unfairness, or oppression affecting the sale. It argues that
                    the terms of the Factoring Agreement are themselves the evidence of fraud,
                    unfairness, or oppression, and that the NRCP 30(b)(6) witness's testimony
                    should have been disregarded because it was self-serving. Based on the
                    arguments presented to the district court, however, we are not persuaded
                    that the district court erred in finding that there was no evidence of fraud,
                    unfairness, or oppression in this case.3 See Wood v. Safeway, Inc., 121 Nev.
                    724, 729, 121 P.3d 1026, 1029 (2005) (reviewing de novo a district court's
                    decision to grant summary judgment); Old Aztec Mine, Inc. v. Brown, 97

                          'The district court's order is unclear in this respect. The 11 identified
                    cost components add up to $3,417, and the district court appears to have
                    awarded all of the cost components, even though the order ultimately
                    purports to award only $1,364 in costs.

                          3We  likewise perceive no error in the district court's conclusion that
                    because there was no evidence of fraud, unfairness, or oppression, it was
                    unnecessary to evaluate whether the sales price was grossly inadequate or
                    whether First 100/respondent were bona fide purchasers. To the extent that
                    appellant contends this case is identical to U.S. Bank National Ass'n v. The
                    Gifford W. Cochran Revocable Living Trust, No. 77642, 2020 WL 2521786
                    (Nev. May 15, 2020) (Order Vacating Judgment and Remanding), we are
                    not persuaded, as this case contains different evidence. Similarly, Lahrs
                    Family Trust v. JP Morgan Chase Bank, N.A., No. 74059, 2019 WL 4054161
                    (Nev. Aug. 27, 2019) (Order of Affirmance), is distinguishable because the
                    winning bid in that case was only $100, id. at *1.

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                Nev. 49, 52, 623 P.2d 981, 983 (1981) (recognizing that this court need not
                consider arguments raised for the first time on appeal). Accordingly, we
                affirm the district court's summary judgment insofar as it adjudicated the
                parties' quiet title claims and determined that the HOA's foreclosure sale
                extinguished the first deed of trust.4
                            Appellant next contends that the district court erred in
                awarding respondent damages for its counterclaims. Appellant contends
                alternatively that (1) respondent did not introduce evidence to support its
                unjust enrichment counterclaim,5 or (2) the district court abused its
                discretion in relying on the testimony of an untimely disclosed witness as
                the basis for its calculation of damages.
                            We are not persuaded by either argument. With respect to its
                first argument, appellant contends that respondent failed to introduce
                evidence that respondent "confer[red] a benefit" on appellant. Cf. Certified
                Fire Prot. Inc. v. Precision Constr. Inc., 128 Nev. 371, 381, 283 P.3d 250, 257

                      "Appellant argued alternatively in district court that even if the
                HOA's foreclosure sale was not set aside, the sale did not extinguish the
                deed of trust. However, appellant does not pursue that argument on appeal,
                so we need not address that issue. See Powell v. Liberty Mut. Fire Ins. Co.,
                127 Nev. 156, 161 n.3, 252 P.3d 668, 672 n.3 (2011) (recognizing that this
                court does not address issues that are not raised in an opening brief).

                      5Appellant also contends that respondent failed to introduce evidence
                to support its wrongful foreclosure and trespass/conversion counterclaims,
                but the district court did not award any damages with respect to those
                counterclaims beyond the roughly $77,000 in lost rental income that it
                awarded for the unjust enrichment counterclaim. Given our below analysis
                of the unjust enrichment counterclaim, we need not address appellant's
                arguments regarding these other two counterclaims.

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                (2012) ("Unjust enrichment exists when the plaintiff confers a benefit on the
                defendant, the defendant appreciates such benefit, and there is acceptance
                and retention by the defendant of such benefit under circumstances such
                that it would be inequitable for hirn to retain the benefit without payment
                of the value thereof." (emphasis added) (internal quotation marks omitted)).
                In this, appellant appears to contend that because appellant did not rent
                out the property while it was in appellant's possession, respondent should
                not have been entitled to the rental income respondent would have earned
                if the property had rernained in respondent's possession. We disagree, as
                the "benefit" that respondent "conferred" upon appellant was the ability to
                use the property as a source of income. Cf. Leasepartners Corp. v. Robert L.
                Brooks Tr. Dated Nov. 12, 1975, 113 Nev. 747, 756, 942 P.2d 182, 187 (1997)
                ("The doctrine of unjust enrichment or recovery in quasi contract applies to
                situations where there is no legal contract but where the person sought to
                be charged is in possession of money or property which in good conscience
                and justice he should not retain but should deliver to another [or should pay
                for]." (alteration in original)). Appellant cannot "in good conscience" avoid
                liability to respondent by preventing respondent from renting out the
                property and then deciding not to use the property in the way respondent
                would have used it.6    Accordingly, we agree with the district court that

                      6Appellant  does not dispute that respondent would have rented out
                the property if respondent retained possession of it. Had there been such a
                dispute, our analysis of this issue may have been different. Relatedly,
                although there appears to be confusion as to whether appellant, respondent,
                a tenant, or a squatter "possessed" the property during the relevant time
                frame, appellant has not coherently argued on appeal that this issue
                warrants reversal of the damages award.

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                respondent    introduced   evidence   to   support   its   unjust   enrichment

                counterclaim.
                             With respect to appellant's second argument, appellant
                contends that the district court abused its discretion in relying on the
                testimony of respondent's expert witness when respondent failed to comply
                with NRCP 16.1(a)'s disclosure requirements:7        See Otis Elevator Co. u.

                Reid, 101 Nev. 515, 523, 706 P.2d 1378, 1383 (1985) (recognizing that
                district courts have discretion to admit the testimony of an untimely
                disclosed witness). We disagree. Although appellant did not disclose its
                expert witness until October 2019, which was after the close of discovery,
                the prove-up hearing was not held until March 2021.           Appellant again

                objected to the untimely disclosure at that hearing, which the district court
                overruled. We conclude that the necessary implication behind the district
                court's decision is that the untimely disclosure was harmless, given that
                respondent had roughly a year and a half to investigate or challenge the
                expert witness's opinions and report. See NRCP 37(c)(1). Accordingly, we
                affirm the district court's March 2021 award insofar as it awarded
                respondent damages.
                             Appellant finally contends that the district court erred in
                awarding respondent its costs. Appellant contends alternatively that (1)
                respondent failed to timely file a memorandum of costs, or (2) respondent
                failed to provide sufficient documentation supporting its request for costs

                      7Appellant also contends that the district court abused its discretion
                by finding the witness was qualified to provide expert testimony. However,
                appellant did not raise this argument below. We therefore decline to
                address it. Old Aztec Mine, 97 Nev. at 52, 623 P.2d at 983.

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                   with respect to five deposition transcripts. With respect to appellant's first
                   argument, respondent filed its memorandum of costs five months after the
                   district court's May 2019 summary judgment order, which is well beyond
                   the allotted time frame. See NRS 18.110(1) ("The party in whose favor
                   judgment is rendered, and who claims costs, must file with the clerk, and
                   serve a copy upon the adverse party, within 5 days after entry of judgment,
                   or such further time as the court or judge may grant, a memorandum of the
                   items of the costs in the action or proceeding . . . ."). At the March 4, 2021,
                   prove-up hearing, however, respondent's counsel cited Barbara Ann Hollier
                   Trust v. Shack, 131 Nev. 582, 591, 589, 356 P.3d 1085, 1089 (2015), as
                   support for the proposition that appellant's motion to reconsider the May
                   2019 summary judgment order tolled NRS 18.110's five-day time frame.
                   While Shack involved the tolling of NRCP 54(d)(2)(B) (as opposed to NRS
                   18.110(1)) and involved tolling of a final judgment (which is not the case
                   here), we nevertheless conclude that Shack provided sufficient justification
                   for the district court to grant respondent "further time" to file its
                   memorandum of costs. NRS 11.1180(1); see Valladares v. DMJ, Inc., 110
                   Nev. 1291, 1293, 885 P.2d 580, 582 (1994) (reviewing for an abuse of
                   discretion a district court's decision to grant or deny a time extension under
                   NRS 18.110(1)).
                               With respect to appellant's second argument, appellant
                   contends that respondent failed to produce sufficient documentation
                   regarding the costs for the deposition transcripts because respondent did
                   not specify whose depositions were taken. Respondent does not address this
                   argument, which we deem to be a confession of error. See Ozawa v. Vision
                   Airlines, Inc., 125 Nev. 556, 563, 216 P.3d 788, 793 (2009) (recognizing that

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                failure to respond to an argument can be treated as a confession that the
                argument is meritorious).         Accordingly, we reverse the district court's
                March 2021 order insofar as it awarded costs for the five deposition
                transcripts.
                               Consistent with the foregoing, we
                               ORDER the judgments of the district court AFFIRMED IN
                PART AND REVERSED IN PART AND REMAND this matter to the
                district court for proceedings consistent with this order.8

                                          Parraguirre

                                             J.                                        , Sr.J.
                Cadish

                cc:   Hon. Nadia Kra11, District Judge
                      Kristine M. Kuzemka, Settlement Judge
                      Troutman Pepper Hamilton Sanders LLP/Atlanta
                      Wright, Finlay & Zak, LLP/Las Vegas
                      The Law Office of Vernon Nelson
                      Eighth District Court Clerk

                      8The   Honorable Mark Gibbons, Senior Justice, participated in the
                decision of this matter under a general order of assignment.

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