UNITED STATES COURT OF APPEALS FOR THE NINTH CIRCUIT

BANK OF NEW YORK MELLON, FKA No. 19-17048 Bank of New York, as Trustee for the Certificateholders of CWALT, D.C. No. Inc., Alternative Loan Trust 2005- 2:17-cv-01916- 54CB, Mortgage Pass-Through RFB-EJY Certificates Series 2005-54CB, Plaintiff-Appellant, OPINION v. ENCHANTMENT AT SUNSET BAY CONDOMINIUM ASSOCIATION; 732 HARDY WAY TRUST, Defendants-Appellees,

and HAROLD HILL; NEVADA ASSOCIATION SERVICES, INC., Defendants.

Appeal from the United States District Court for the District of Nevada Richard F. Boulware II, District Judge, Presiding

Argued and Submitted November 17, 2020 Pasadena, California

Filed June 25, 2021 2 BANK OF NEW YORK MELLON V. 732 HARDY WAY TRUST

Before: Johnnie B. Rawlinson, Danielle J. Forrest, and Lawrence VanDyke, Circuit Judges.

Opinion by Judge VanDyke; Concurrence by Judge VanDyke; Dissent by Judge Forrest

SUMMARY *

Nevada Foreclosure Law / Bankruptcy Automatic Stay

The panel reversed the district court’s summary judgment that was entered in favor of the 732 Hardy Way Trust, its denial of summary judgment to the Bank of New York Mellon (the “Bank”), and its dismissal of the Bank’s claims against a Homeowners Association (“HOA”) in a quiet title action brought by the Bank, concerning title to real property in Nevada that was subject to a HOA nonjudicial foreclosure sale.

Harold Hill purchased property at 732 Hardy Way, Mesquite, Nevada. The Bank was a first deed of trust lienholder. In January 2014, Hill fell behind in his HOA dues, and the HOA recorded a notice of delinquent assessment lien in February 2014. In April 2014, Hill filed for Chapter 13 bankruptcy, and an automatic stay went into effect. On July 15, 2014, while Hill’s bankruptcy case was pending, the HOA recorded a notice of foreclosure sale, and sold the property to the Trust.

* This summary constitutes no part of the opinion of the court. It has been prepared by court staff for the convenience of the reader. BANK OF NEW YORK MELLON V. 732 HARDY WAY TRUST 3

The panel held that the Bank had prudential standing to make the argument that the HOA foreclosure sale occurred in violation of the automatic stay and was thus void. Because the Bank had standing, its interest as a creditor was protected under Nevada law. The panel held further that any HOA foreclosure sale in violation of the automatic bankruptcy was void, and not merely voidable, under Nevada law. The panel concluded that the Bank’s interest was superior to the Trust’s interest where the Bank provided evidence that: Hill listed the property in his bankruptcy schedules in March 2014; the automatic bankruptcy stay was active through 2017; and the property was auctioned off on September 19, 2014. The panel held that the Bank should receive quiet title to the property under Nevada Revised Statute 40.010.

In his concurring opinion, Judge VanDyke wrote separately to explain further why he thought Judge Forrest’s dissent was incorrect. He wrote that underlying the dissent’s analysis was the concept that the factual voidness of the foreclosure sale here could only be raised in this state-law action by certain entities, which meant that the sale was only void as to certain entities if they so choose. This is what was usually meant when a transaction was said to be “voidable, not void.” The dissent’s reliance on a “voidable, not void” rationale was directly at odds with this court’s clear authority recognizing that violations of a bankruptcy stay are in fact “void,” not voidable. The dissent’s assertion that the automatic stay did not protect individual creditors when