Bank of New York Mellon Trust Company, National Association v. SFR Investments Pool 1, LLC

D. Nevada

Bank of New York Mellon Trust Company, National Association v. SFR Investments Pool 1, LLC

District Court, D. Nevada·Decided November 25, 2019·No. 2:18-cv-00978·Unknown

Opinion

BANK OF NEW YORK MELLON TRUST Case No.: 2:18-cv-00978-APG-DJA COMPANY, NATIONAL ASSOCIATION, Order (1) Granting SFR’s Motion for Plaintiff Summary Judgment, (2) Denying BONY’s Motion for Summary Judgment, and v. (3) Denying SFR’s Motion to Strike as Moot SFR INVESTMENTS POOL 1, LLC, et al., [ECF Nos. 42, 50, 52] Defendants

Plaintiff Bank of New York Mellon Trust Company, National Association (BONY), as Trustee for Residential Asset Mortgage Products, Inc., Mortgage Asset-Backed Pass-Through Certificates Series 2002-RS3, sues to determine whether a non-judicial foreclosure sale conducted by the homeowners association (HOA) extinguished BONY’s deed of trust encumbering property located at 1809 Iron Ridge Drive in Las Vegas, Nevada. Defendant SFR Investments Pool 1, LLC (SFR) bought the property at the HOA foreclosure sale. I previously denied SFR’s motion to dismiss BONY’s unjust enrichment claim. ECF No. 33 at 10-11. SFR and BONY move for summary judgment on this claim. SFR also moves to strike the exhibit attached to BONY’s motion. The parties are familiar with the facts so I do not repeat them here except where necessary. I grant SFR’s motion and deny BONY’s motion because BONY’s payment of insurance premiums conferred no benefit on SFR and BONY’s payments of taxes were voluntary. I deny SFR’s motion to strike as moot. / / / / / / / / Summary judgment is appropriate if the movant shows “there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Fed. R. Civ. P. 56(a), (c). A fact is material if it “might affect the outcome of the suit under the governing law.” Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). A dispute is genuine if “the evidence

is such that a reasonable jury could return a verdict for the nonmoving party.” Id. The party seeking summary judgment bears the initial burden of informing the court of the basis for its motion and identifying those portions of the record that demonstrate the absence of a genuine issue of material fact. Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). The burden then shifts to the non-moving party to set forth specific facts demonstrating there is a genuine issue of material fact for trial. Fairbank v. Wunderman Cato Johnson, 212 F.3d 528, 531 (9th Cir. 2000); Sonner v. Schwabe N. Am., Inc., 911 F.3d 989, 992 (9th Cir. 2018) (“To defeat summary judgment, the nonmoving party must produce evidence of a genuine dispute of material fact that could satisfy its burden at trial.”). I view the evidence and reasonable inferences in the

light most favorable to the non-moving party. James River Ins. Co. v. Hebert Schenk, P.C., 523 F.3d 915, 920 (9th Cir. 2008). “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 him to retain the benefit without payment of the value thereof.” Certified Fire Prot. Inc. v. Precision Constr., 283 P.3d 250, 257 (Nev. 2012) (quotation omitted). / / / / / / / / SFR argues that BONY has not produced proof that it paid taxes or insurance after the HOA foreclosure sale, so it cannot show SFR was unjustly enriched. Alternatively, SFR argues that BONY’s unjust enrichment claim fails under the voluntary payment doctrine because BONY was not required by law to pay, it never asked SFR to pay, and it never told SFR it was paying

under protest. SFR also moves to strike an exhibit that BONY attached to its motion for summary judgment as not timely disclosed and unauthenticated. BONY responds that it has produced evidence that it paid property taxes and insurance premiums for the property. It also argues it did so to preserve its security interest in the property, so the voluntary payment doctrine does not apply. BONY contends I should not strike its exhibit because it was timely produced through a supplemental disclosure and is authenticated in its reply brief. A. Insurance Premiums Even if I considered BONY’s late-produced evidence, its unjust enrichment claim fails as

a matter of law as to the insurance premiums because BONY has presented no evidence or argument as to how BONY conferred a benefit on SFR through paying insurance premiums. There is no evidence that SFR is an additional insured on the policy or would receive proceeds from a payout under the policy. I therefore grant SFR’s motion and deny BONY’s motion as to the insurance premiums. B. Taxes “The voluntary payment doctrine is a long-standing doctrine of law, which clearly provides that one who makes a payment voluntarily cannot recover it on the ground that he was under no legal obligation to make the payment.” Nevada Ass’n Servs., Inc. v. Eighth Jud. Dist. Ct., 338 P.3d 1250, 1252 (Nev. 2014) (en banc) (quotation omitted). A payment is voluntary if made “without protest as to its correctness or legality.” Id. at 1253 (quotation and emphasis omitted). The doctrine is an affirmative defense, so SFR bears the burden of proving it applies. Id. at 1254. Once SFR shows that BONY made a voluntary payment, “the burden shifts to [BONY] to demonstrate that an exception to the voluntary payment doctrine applies.” Id. If an

exception applies, then BONY “is not precluded from recovering a payment that it made without protest.” Id. One exception to the doctrine is a payment made in the defense of property. This defense applies where the party making the payment risks losing a property interest if it does not make the payment. Id. A lien “that is not subject to ongoing or imminent foreclosure proceedings does not create a risk of the loss of property,” so the defense of property exception would not be triggered. Id. “Furthermore, where a reasonable legal remedy is available to the payor, a payment made to relieve the lien is voluntary.” Id. Here, BONY alleged in its complaint that it paid insurance premiums and property taxes

for the property after the HOA sale. ECF No. 1 at 15. Although SFR disputes that BONY has presented evidence of any such payments, SFR has presented evidence that if BONY did so, the payment was voluntary. There is no evidence that, as a lienholder, BONY had a legal obligation to pay property taxes or insurance premiums on the property. There is no evidence that after the HOA sale, SFR requested that BONY pay taxes or insurance premiums for the property, that SFR refused to pay taxes or insurance after BONY requested it do so, that BONY billed SFR, or that BONY otherwise objected to making any such payments. ECF No. 42-2 at 3. SFR therefore has met its burden of showing BONY’s payment was voluntary. BONY contends the defense of property exception applies because it made those payments to preserve its security interest in the property. But BONY has presented no evidence that a tax lien existed against the property or that any such lien was subject to imminent or ongoing foreclosure such that BONY’s security interest was at risk of loss. BONY therefore has not demonstrated that the defense of property exception applies.

Free access — add to your briefcase to read the full text and ask questions with AI