Chapman v. Deutsche Bank National Trust Co.

651 F.3d 1039, 2011 U.S. App. LEXIS 12693, 2011 WL 2508152
CourtCourt of Appeals for the Ninth Circuit
DecidedJune 23, 2011
Docket10-15215
StatusPublished
Cited by86 cases

This text of 651 F.3d 1039 (Chapman v. Deutsche Bank National Trust Co.) is published on Counsel Stack Legal Research, covering Court of Appeals for the Ninth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Chapman v. Deutsche Bank National Trust Co., 651 F.3d 1039, 2011 U.S. App. LEXIS 12693, 2011 WL 2508152 (9th Cir. 2011).

Opinion

ORDER

PER CURIAM.

“Where concurrent proceedings in state and federal court are both suits in rem or quasi in rem, the court first assuming jurisdiction over the property may maintain and exercise that jurisdiction to the exclusion of the other.” Knaefler v. Mack, 680 F.2d 671, 675 (9th Cir.1982) (footnote omitted). The property at issue in this quiet title action was also the subject of a previously filed unlawful detainer action that was proceeding concurrently in state court. In order to decide whether the federal District Court properly exercised jurisdiction over this action, we must determine whether Nevada law characterizes quiet title actions and unlawful detain-er actions as in rem, quasi in rem, or in personam.

Because these questions of law are determinative of the matter pending before this court, and there is no clearly controlling precedent in the decisions of the Nevada Supreme Court, we respectfully certify to the Nevada Supreme Court the questions of law set forth in Part III of this order. See Nev. RApp. P. 5.

I. BACKGROUND

A. Quiet Title Action

This appeal stems from a complaint (the Quiet Title Action) filed by Plaintiffs-Appellants George and Brenda Chapman (the Chapmans) against Defendants-Appellees Deutsche Bank National Trust Company (Deutsche Bank), National Default Servicing Corporation, and HomEq Servicing Corporation (collectively, the Defendants). The complaint was filed in the Second Judicial District Court of the State of Nevada (the state District Court), and was subsequently removed to the United States District Court for the District of Nevada (the federal District Court).

*1042 In their complaint, the Chapmans alleged that “[t]hey fell behind on payments on [their] mortgage,” and the Defendants initiated non-judicial foreclosure proceedings against the Chapmans’ home (the Property). Deutsche Bank then purchased the Property at an October 2008 trustee’s sale.

According to the complaint, the Defendants’ conduct allegedly violated two rules governing trustee’s sales under Nevada law: first, the Chapmans “were never given statutory notice of the default” or “notice of trustee’s sale” as required by Nevada Revised Statutes § 107.080, and second, the Defendants did not “own[ ] [the Chap-mans’] promissory note or their deed of trust,” thus barring them from foreclosing and obtaining title to the Property. The Chapmans sought the following relief: (1) declaratory relief determining that the trustee’s sale was void ab initio, (2) a quiet title judgment determining that they are owners of the Property in fee simple, and that the Defendants “have no right, title, estates, lien or interest in the Property,” and (3) actual and punitive damages on account of the Defendants’ “massively disorganized” conduct and “open disregard for the law.” Fairly read, the Chapmans’ complaint included two causes of action: a common-law claim for the tort of wrongful foreclosure, see Collins v. Union Fed. Sav. & Loan Ass’n, 99 Nev. 284, 304, 662 P.2d 610, 623 (1983), and a statutory claim for quiet title, see Nev.Rev.Stat. § 40.010.

B. Unlawful Detainer Action

Approximately three months prior to the time that the Chapmans filed the Quiet Title Action, Deutsche Bank initiated unlawful detainer proceedings (the Unlawful Detainer Action) against the Chapmans in the Reno Justice Court of the State of Nevada. Deutsche Bank alleged that it was the owner of the Property, and accordingly requested restitution of the premises from the Chapmans. From the record presented to us, it appears that the Justice Court did not take any action in the Unlawful Detainer Action until after the Quiet Title Action was filed in state District Court.

C. State and Federal Court Proceedings

After the Chapmans filed their Quiet Title Action against Defendants, but before Defendants removed that action to federal court, the Chapmans filed a motion in the Unlawful Detainer Action to transfer that case from the state Justice Court to the state District Court, where the Quiet Title Action was pending. While the motion to transfer was pending in state Justice Court, the Defendants removed the Quiet Title Action to federal court. A week later, the state Justice Court transferred the Unlawful Detainer Action to the state District Court.

In the federal proceedings, the Chap-mans filed a motion to remand the action to state court under 28 U.S.C. § 1447(c). The Chapmans contended (in relevant part) that the federal court should abstain or dismiss the Quiet Title Action because the Unlawful Detainer Action was proceeding simultaneously in state court. The Defendants then filed a motion to dismiss the Quiet Title Action for failure to state a claim under Federal Rule of Civil Procedure 12(b)(6). After holding a hearing on the motions, during which the Chapmans’ attorney informed the court that the Unlawful Detainer Action remained pending in state District Court, the court denied the motion to remand and granted the motion to dismiss the complaint. The Chapmans timely appeal.

II. DISCUSSION

A. Jurisdiction and Standard of Review

We have jurisdiction over “all final decisions” issued by federal district courts. *1043 28 U.S.C. § 1291. “Ordinarily an order dismissing the complaint rather than dismissing the action is not a final order and thus not appealable. However, if it appears that the district court intended the dismissal to dispose of the action, it may be considered final and appealable.” Knevelbaard Dairies v. Kraft Foods, Inc., 232 F.3d 979, 983 (9th Cir.2000) (alteration and internal quotation marks omitted). Here, the federal District Court intended to fully and finally resolve this action. The court did not permit the Chapmans to amend their complaint, see, e.g., In re Ford Motor Co./Citibank (S.D.), N.A., 264 F.3d 952, 957 (9th Cir.2001), and, after considering various pieces of evidence extrinsic to the complaint, the court determined conclusively that the “Defendants complied with the non-judicial foreclosure requirements established under Nevada law.” We therefore have jurisdiction under 28 U.S.C. § 1291.

We review de novo a district court’s denial of a motion to remand to state court for lack of federal subject matter jurisdiction. United Computer Sys., Inc. v. AT & T Corp., 298 F.3d 756, 760 (9th Cir.2002).

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651 F.3d 1039, 2011 U.S. App. LEXIS 12693, 2011 WL 2508152, Counsel Stack Legal Research, https://law.counselstack.com/opinion/chapman-v-deutsche-bank-national-trust-co-ca9-2011.