Bergenfield v. Bank of America
129 Nev. 382
Nev.2013Background
- Bergenfield obtained a home loan from Countrywide Home Loans, Inc. and executed a promissory note in Countrywide's favor, secured by a deed of trust naming Countrywide as lender and MERS as beneficiary.
- MERS assigned its interest in the deed of trust to HSBC Bank USA, with the assignment stating it carried both the deed of trust and the underlying note.
- Countrywide endorsed the note in blank, making the holder entitled to payment by possession of the note, and Bank of America later acquired Countrywide and its assets.
- Bergenfield defaulted and participated in Nevada's Foreclosure Mediation Program (FMP); mediation notice named Bank of America as deed-of-trust beneficiary and ReconTrust Co. as trustee.
- At mediation, BAC Home Loans Servicing, LP appeared representing Bank of America; HSBC did not attend; no agreement was reached.
- The district court denied Bergenfield's petition for judicial review, later concluding BAC had authority to negotiate the loan and participate in good faith; Bergenfield appealed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether a note holder who is not the deed-of-trust beneficiary can participate in FMP mediation. | Bergenfield: non-beneficiary cannot participate or obtain FMP certificate. | Bank of America: it holds the note and may negotiate the loan. | No; non-beneficiary note holder cannot participate or obtain FMP certificate. |
| Whether the note and deed of trust must be reunified to authorize FMP participation. | If severed, authority to participate is lacking. | Holding the note suffices for some authority to negotiate under the loan. | They must be reunified to establish authority to participate. |
| Whether the district court erred by denying judicial review and sanctions given lack of authority. | District court erred in allowing BAC to negotiate and in issuing no sanctions. | District court found BAC had negotiating authority. | District court erred; sanctions warranted; remand for Pasillas factors. |
Key Cases Cited
- Edelstein v. Bank of N.Y. Mellon, 286 P.3d 249 (Nev. 2012) (severance of note and deed of trust without impairing foreclosure rights; reunification required for authority to foreclose)
- Leyva v. Nat'l Default Servicing Corp., 255 P.3d 1275 (Nev. 2011) (deed-of-trust beneficiary must attend mediation; note holder alone not sufficient)
- Holt v. Reg'l Tr. Servs. Corp., 266 P.3d 602 (Nev. 2011) (sanctions under NRS 107.086(5) for lack of authority; attendance requirement emphasized)
- Webb v. Shull, 270 P.3d 1266 (Nev. 2012) (statutory language given plain meaning; beneficiary attendance required)
- Pasillas v. HSBC Bank USA, 255 P.3d 1281 (Nev. 2011) (factors for sanctions after improper FMP participation)