Similar to the CAI amicus filing of Chase Bank v. Chase Plaza Condo in Washington, D.C. in 2013, the question raised in this case is whether a priority lien has true priority over a first security interest. Additionally, the trial courts that have decided that there is no extinguishment of a first deed of trust have done so on numerous, conflicting theories. For example, some have determined that “action to enforce the lien" means a judicial foreclosure is required, despite express language that allows non-judicial foreclosure. Some have stated that the priority amount is merely a “payment priority" to be paid when the deed of trust forecloses, despite no mechanism in statute to pay the priority amounts from the sale proceeds. Some have decided it is a payment priority that is only triggered when the association files a lawsuit.
Simply put, there is no controlling law on the interpretation with approximately 100 cases pending before the Nevada Supreme Court and Ninth Circuit. The Nevada Supreme Court also recently issued an order to set oral argument in one case, but has not yet scheduled the date. Other fully briefed cases are receiving orders that they will be submitted on the brief without argument. Thus, the issue has reached a critical mass.
CAI is filing two similar, but separate, amicus briefs on the issue of extinguishment: one before the 9th Circuit and one before the Nevada Supreme Court.
Brief (9th Circuit): Pending
Brief (Nevada Supreme Court): Pending
Prior Ruling (9th Circuit): District Court - Order for Summary Judgment
Prior Ruling (Nevada Supreme Court): District Court Motions
Status: Supreme Court Ruling for CAI's Position
CAI Amicus Brief Author: Thomas Moriarty, Esq.; Loura Sanchez, Esq.; Henry Goodman, Esq.
CAI Amicus Brief Review Committee: Stephen Marcus, Esq; Henry Goodman, Esq; Steve Weil, Esq; Jonathan Levine, Esq.; Gary Kessler, Esq.