Christiana Trust v. SFR Investments Pool 1, LLC, 2:16-cv-00684

Background:

Property at 479 N. Sand Crane Circle, Sparks, NV was secured by a deed of trust (DOT) originally in favor of BAC; Christiana Trust later recorded an assignment from BAC.
HOA, through agent Alessi & Koenig, initiated a nonjudicial foreclosure for unpaid assessments in 2012–2013; the trustee’s sale occurred October 24, 2013, and SFR purchased the property and recorded title.
A&K did not mail the statutorily required notice of sale to BAC before the trustee’s sale.
Christiana Trust sued to quiet title and for wrongful foreclosure; the district court granted summary judgment for Christiana Trust and declared the 2013 sale void as to extinguishing the DOT.
SFR moved for reconsideration under Rule 60(b)(6), citing the Nevada Supreme Court’s decision in U.S. Bank v. Resources Group, LLC (Resources Group II), which clarified when NRS Chapter 116 sales are void versus voidable and requires examining actual notice and prejudice.
The district court granted reconsideration in part, finding Resources Group II is intervening authority that raises substantial issues; the court indicated willingness, if remanded by the Ninth Circuit, to reconsider evidence of actual notice and prejudice and whether the sale was void or voidable, but deferred other legal questions (including standing) because the matter is on appeal.

Issues:

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether the October 24, 2013 trustee’s sale is void for failure to provide statutorily required notice to the DOT holder	Sale is void because BAC did not receive the required notice; sale extinguished DOT	Resources Group II requires inquiry into whether BAC received actual notice by alternative means and whether prejudice resulted; absence of statutory notice alone does not automatically void a sale	Court previously declared sale void but, citing Resources Group II, granted reconsideration in part to revisit actual notice and prejudice on remand
Whether Resources Group II is intervening controlling authority that alters the notice/prejudice analysis	Christiana: prior unpublished Nevada authority addressed alternative notice; Resources Group II not controlling retroactively	SFR: Resources Group II is the first published Nevada decision mandating actual-notice/prejudice analysis going forward	Court: Resources Group II is intervening authority narrowing the applicable law and raises substantial issue warranting reconsideration
Whether a sale without statutory notice is void or only voidable	Sale is void as adjudicated in the prior order	Sale may be voidable rather than void if the DOT holder received actual notice or was not prejudiced	Court declined to decide now; will consider on remand whether evidence supports void vs voidable determination
Whether Christiana Trust (as assignee) has standing to challenge the foreclosure notice and sale	Christiana asserts standing via recorded assignment from BAC	SFR (citing W. Sunset and Resources Group II) contends successors may lack standing to assert pre-sale notice defects	Court declined to rule due to ongoing appeal and will defer this issue to the Ninth Circuit or remand determination

Key Cases Cited

Carroll v. Nakatani, 342 F.3d 934 (9th Cir. 2003) (reconsideration is an extraordinary remedy used sparingly)
School Dist. No. 1J, Multnomah Cnty v. ACandS, Inc., 5 F.3d 1255 (9th Cir. 1993) (grounds for reconsideration: new evidence, clear error, or intervening change in law)
Marlyn Nutraceuticals, Inc. v. Mucos Pharma GmbH & Co., 571 F.3d 873 (9th Cir. 2009) (a motion for reconsideration cannot raise arguments that could have been presented earlier)
U.S. Bank, Nat'l Ass'n v. Resources Group, LLC, 444 P.3d 442 (Nev. 2019) (clarifies when NRS Chapter 116 sales are void versus voidable; requires consideration of actual notice and prejudice)
W. Sunset 2050 Tr. v. Nationstar Mortg., LLC, 420 P.3d 1032 (Nev. 2018) (addresses standing and related issues in challenges to foreclosure sales)