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Ditech Fin. v. Hampton & Hampton Collections, LLC

United States Court of Appeals, Ninth Circuit
Oct 27, 2022
No. 20-16357 (9th Cir. Oct. 27, 2022)

Opinion

20-16357

10-27-2022

DITECH FINANCIAL LLC, FKA Green Tree Servicing, LLC, Plaintiff-counter- defendant-Appellee, v. HAMPTON & HAMPTON COLLECTIONS, LLC; VISTA GRANDE HOMEOWNERS ASSOCIATION, Defendants, and SATICOY BAY, LLC SERIES 256 CAMINO VIEJO, Defendant-counter- claimant-Appellant.


NOT FOR PUBLICATION

Submitted October 19, 2022 [**] San Francisco, California

Appeal from the United States District Court for the District of Nevada D.C. No. 2:19-cv-00118-JCM-NJK James C. Mahan, District Judge, Presiding

Before: GILMAN, [***] CALLAHAN, and VANDYKE, Circuit Judges.

MEMORANDUM [*]

Saticoy Bay, LLC Series 256 Camino Viejo ("Saticoy") appeals from the district court's grant of summary judgment in favor of Ditech Financial LLC ("Ditech") in a quiet title and declaratory relief action involving residential property located in Las Vegas, Nevada. We have jurisdiction under 12 U.S.C. § 1291, review de novo, Berezovsky v. Moniz, 869 F.3d 923, 927 (9th Cir. 2017), and affirm.

This case arises from a foreclosure sale to satisfy a homeowners association ("HOA") "superpriority lien" on the property. Nevada law provides that if a homeowner fails to pay a certain portion of HOA dues, the HOA is authorized to foreclose on a "superpriority lien" in that amount, extinguishing other liens and encumbrances on the delinquent property, including a previously recorded first deed of trust. See Nev. Rev. Stat. § 116.3116. However, the Federal Foreclosure Bar prohibits the foreclosure of Federal Housing Finance Agency ("FHFA") property without FHFA's consent, and the Federal Foreclosure Bar preempts the Nevada superpriority lien scheme. 12 U.S.C. § 4617(j)(3); see also Berezovsky, 869 F.3d at 931. The Federal National Mortgage Association ("Fannie Mae") was placed under FHFA's conservatorship in 2008.

Here, the district court determined that the property was subject to a deed of trust held by Fannie Mae and serviced by Ditech; thus, the Federal Foreclosure Bar precluded the deed of trust from being extinguished in the absence of the FHFA consent. Saticoy presents several arguments on appeal, none of which have merit under existing precedent.

1. First, Saticoy claims that Ditech lacks standing to assert the Federal Foreclosure Bar as the loan servicer. But we recently reaffirmed clearly existing precedent establishing that "a loan servicer has standing to assert the Federal Foreclosure Bar on behalf of ... Fannie Mae." Nationstar Mortg. LLC v. Saticoy Bay LLC, Series 9229 Millikan Ave., 996 F.3d 950, 955 (9th Cir. 2021) (quoting Daisy Tr. v. Wells Fargo Bank, 445 P.3d 846, 847 n.1 (Nev. 2019) (en banc)). Ditech presented evidence that it was Fannie Mae's loan servicer. See id. (holding that Fannie Mae business records, employee declarations, and Servicing Guide were sufficient to establish that Nationstar was Fannie Mae's loan servicer). Thus, Saticoy's standing argument is meritless.

2. Next, Saticoy presents a series of arguments that the Federal Foreclosure Bar did not preserve Fannie Mae's deed of trust. Saticoy first asserts that there was insufficient evidence presented to establish Fannie Mae's ownership of the deed of trust. However, the evidence submitted in support of Ditech's motion on Fannie Mae's ownership is nearly identical to that held to be sufficient in Nationstar and Daisy Trust, including internal database printouts, a supporting employee declaration, and the Servicing Guide. See Nationstar, 996 F.3d at 956; see also Daisy Tr., 445 P.3d at 849-50.

Saticoy also argues that Fannie Mae does not maintain ownership of the note and deed of trust under Nevada Law where its servicer is the record beneficiary of the deed of trust. To the contrary, it is well established that where a note owner has a contractually authorized relationship with the record beneficiary of the corresponding deed of trust, the note owner maintains a valid and enforceable interest. See Berezovksy, 869 F.3d at 932 (citing In re Montierth, 354 P.3d 648, 650-51 (Nev. 2015)); see also M& TBank v. SFR Invs. Pool 1, LLC, 963 F.3d 854, 856 n.1 (9th Cir. 2020).

Saticoy next argues that Fannie Mae does not hold a valid ownership interest in the deed of trust because Ditech failed to produce a signed writing proving that interest as required by the Nevada statute of frauds. See Nev. Rev. Stat. § 111.205(1). But this argument is also foreclosed by our recent decision in Nationstar, which confirms that (1) Saticoy cannot raise the argument as a third party to the underlying loan agreement, and (2) the statute of frauds is inapplicable. See Nationstar, 996 F.3d at 957.

Saticoy's argument that the deed of trust can be extinguished despite the FHFA's lack of consent also fails because it is premised on Saticoy's rejected assertion that Fannie Mae did not have an ownership interest at the time of the HOA foreclosure sale.

3. Finally, Saticoy asserts that its status as a bona fide purchaser under Nevada law precludes operation of the Federal Foreclosure Bar. However, the Nevada Supreme Court has held all that is required to put the public on notice is to have Fannie Mae's loan servicer and agent listed as the beneficiary on the recorded deed of trust at the time of the HOA foreclosure sale. Daisy Tr., 445 P.3d at 849. Moreover, even assuming Nevada's bona fide purchaser statutes were implicated, Saticoy had constructive knowledge of Fannie Mae's interest such that it could not be a bona fide purchaser. See Nationstar, 996 F.3d at 957-58.

For these reasons, the district court's grant of summary judgment for Ditech is AFFIRMED.

Simultaneous with the filing of this opinion, we issue an order to show cause why Saticoy and its counsel should not be sanctioned for maintaining frivolous appeals. Fed. R. App. P. 38; see also 28 U.S.C. § 1912.

[*] 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).

[***] The Honorable Ronald Lee Gilman, Senior Judge of the United States Court of Appeals for the Sixth Circuit, sitting by designation.


Summaries of

Ditech Fin. v. Hampton & Hampton Collections, LLC

United States Court of Appeals, Ninth Circuit
Oct 27, 2022
No. 20-16357 (9th Cir. Oct. 27, 2022)
Case details for

Ditech Fin. v. Hampton & Hampton Collections, LLC

Case Details

Full title:DITECH FINANCIAL LLC, FKA Green Tree Servicing, LLC, Plaintiff-counter…

Court:United States Court of Appeals, Ninth Circuit

Date published: Oct 27, 2022

Citations

No. 20-16357 (9th Cir. Oct. 27, 2022)