PEGGY A. LEEN, Magistrate Judge.
1. The Federal National Mortgage Association ("Fannie Mae") and the Federal Housing Finance Agency ("FHFA" or "Conservator"), as Conservator for Fannie Mae (together, "Petitioners"), seek to intervene in the above-captioned action pursuant to Fed. R. Civ. P. 24(b) and 12 U.S.C. § 4617(b)(2)(A)(i).
2. Fed. R. Civ. P. 24(b) enables this Court to permit anyone to intervene who "has a claim or defense that shares with the main action a common question of law or fact." Fed. R. Civ. P. 24(b)(1)(B).
3. Because Fannie Mae avers ownership of a mortgage loan on the Property at issue in this action, Fannie Mae has a claimed property interest that Plaintiff seeks to extinguish by this action.
4. FHFA has a direct interest in protecting Fannie Mae's claimed rights to property. On September 6, 2008, FHFA's Director appointed the FHFA Conservator of Fannie Mae and the Federal Home Loan Mortgage Corporation in accordance with the Housing and Economic Recovery Act of 2008, Pub. L. 110-289, 122 Stat. 2654 (codified at 12 U.S.C.§ 4617) ("HERA"), and the Federal Housing Enterprises Financial Safety and Soundness Act of 1992 (12 U.S.C. § 4501, et. seq.). As Conservator, FHFA has succeeded to "all rights, titles, powers, and privileges" of Fannie Mae. See 12 U.S.C. § 4617(b)(2)(A)(i). Moreover, FHFA is charged with taking necessary steps to "preserve and conserve the assets and property of [the Enterprises]" and "take over the assets of and operate [the Enterprises] with all the powers of the shareholders, the directors, and the officers of [the Enterprises]." Id. at §§ 4617(b)(2)(B)(i), (D)(ii). Thus, FHFA has a substantial interest in Plaintiff's action seeking to quiet title and declare extinguished a purported property interest that Fannie Mae claims to hold. See 12 U.S.C. §§ 4617(b)(2)(B)(i), 4617(b)(2)(B)(iv).
5. The Petitioners seek to protect Fannie Mae's property interest and present the statutory defense that Plaintiff's claim of free and clear title to the property at issue in this case (the "Property") is barred by 12 U.S.C. § 4617(j)(3), which Petitioners contend preempts conflicting state law and precludes a homeowner's association sale from extinguishing Fannie Mae's interest in the Property. This statutory defense shares a common question of law or fact with the main action, and is articulated in the Answers Petitioners have filed herewith. Accordingly, permissive intervention under Rule 24(b) is warranted.
6. In the alternative, FHFA asserts that it has an unconditional federal statutory right to intervene in this matter, see Fed. R. Civ. P. 24(a)(1), and to assert its interests in a manner consistent with the Conservator's powers and duties.
7. Pursuant to HERA, FHFA asserts that it has unqualified authority to protect Fannie Mae's assets and property. See 12 U.S.C. § 4617(b)(2)(A)(i); 12 U.S.C. § 4617(b)(2)(D)(i)-(ii). Because Fannie Mae claims an interest in the Property at issue here, the Conservator has authority to intervene to protect that claimed interest.
8. Accordingly, FHFA asserts it has an unconditional federal statutory right to intervene in this matter, see Fed. R. Civ. P. 24(a)(1), and to assert its interests in a manner consistent with the Conservator's powers and duties.
9. Plaintiff and Defendant CitiMortgage, Inc. consent to this motion to intervene. The remaining named defendants have not appeared in this action.
10. Pursuant to Fed. R. Civ. P. 24(c), Petitioners attach as Exhibits A and B their intended Answers.
Proposed Intervenors Fannie Mae and FHFA, Plaintiff LN Management LLC Series 7937 Sierra RIM, and Defendant CitiMortgage, Inc., through their attorneys of record, hereby stipulate and request that the Court make this stipulation an order of the Court:
COMES NOW Proposed Intervenor, FEDERAL NATIONAL MORTGAGE ASSOCIATION ("Fannie Mae") by and through its counsel of record, Pite Duncan, LLP, and provides its Answer to Plaintiff, LN MANAGEMENT LLC SERIES 7937 SIERRA RIM's ("Plaintiff' or "LNM"), Complaint on file herein, admitting, denying, and alleging as follows:
1. Answering Paragraph 1 of the Complaint, Fannie Mae admits the allegations contained therein.
2. Answering Paragraph 2 of the Complaint, Fannie Mae lacks sufficient information to form a belief as to the truth of the allegations, and on that basis denies each and every allegation contained therein.
3. Answering Paragraph 3 of the Complaint, Fannie Mae admits that Benjamin T. Pfeiffer was a trustor under a Deed of Trust recorded in the Official Records of Clark County, Nevada as Instrument No.: 20040702-0001246, encumbering the real property located at 7937 Sierra Rim Drive, Las Vegas, Nevada 89131 ("Property"). As to the remaining allegations, Fannie Mae lacks sufficient information to form a belief as to the truth of the allegations, and on that basis denies each and every remaining contained therein.
4. Answering Paragraph 4 of the Complaint, Fannie Mae admits that Sabrina S. Pfeiffer was a trustor under a Deed of Trust recorded in the Official Records of Clark County, Nevada as Instrument No.: 20040702-0001246, encumbering the Property. As to the remaining allegations, Fannie Mae lacks sufficient information to form a belief as to the truth of the allegations, and on that basis denies each and every remaining contained therein.
5. Answering Paragraph 5 of the Complaint, Fannie Mae admits that CitiMortgage, Inc., is the successor beneficiary of a Deed of Trust recorded on July 2, 2004, in the Official Records of Clark County, Nevada as Instrument No.: 20040702-0001246 and that Fannie Mae is the owner of the corresponding loan. Fannie Mae also admits that Nevada State Bank was the original lender and beneficiary under the Deed of Trust. Fannie Mae lacks sufficient information to form a belief as to the truth of the remaining allegations, and on that basis denies each and every remaining allegation contained therein.
6. Answering Paragraph 6 of the Complaint, Fannie Mae lacks sufficient information to form a belief as to the truth of the allegations, and on that basis denies each and every allegation contained therein.
7. Answering Paragraph 7 of the Complaint, Fannie Mae admits that a Trustee's Deed Upon Sale was recorded on September 20, 2013, in the Official Records of Clark County, Nevada as Instrument No. 201309200001394. Fannie Mae further admits that the Trustee's Deed Upon Sale states that Absolute Collection Services, LLC ("ACS"), "grant[s] and convey[s], but without warranty expressed or implied to: LN Management LLC, Series 7937 Sierra Rim, PO Box 36208, Las Vegas, NV 89133 (herein called Grantee), all its right, title and interest in that certain property situated in County of Clark, State of Nevada, described as follows: 7937 Sierra Rim Dr., Las Vegas, NV 89131. . ." Fannie Mae lacks sufficient information to form a belief as to the truth of the remaining allegations, and on that basis denies each and every remaining allegation contained therein.
8. Answering Paragraph 8 of the Complaint, Fannie Mae admits that a Trustee's Deed Upon Sale was recorded on September 20, 2013, in the Official Records of Clark County, Nevada as Instrument No. 201309200001394. Fannie Mae further admits that the Trustee's Deed Upon Sale states that ACS, "grant[s] and convey[s], but without warranty expressed or implied to: LN Management LLC, Series 7937 Sierra Rim, PO Box 36208, Las Vegas, NV 89133 (herein called Grantee), all its right, title and interest in that certain property situated in County of Clark, State of Nevada, described as follows: 7937 Sierra Rim Dr., Las Vegas, NV 89131. . ." Fannie Mae lacks sufficient information to form a belief as to the truth of the remaining allegations, and on that basis denies each and every remaining allegation contained therein.
9. Answering Paragraph 9 of the Complaint, Fannie Mae admits that it had an interest and continues to have an interest in the property.
10. Answering Paragraph 10 of the Complaint, Fannie Mae denies the allegations contained therein.
11. Answering Paragraph 11 of the Complaint, Fannie Mae lacks sufficient information to form a belief as to the truth of the allegations, and on that basis denies each and every allegation contained therein.
12. Fannie Mae repeats and incorporates each of its responses to Paragraph 1 through 11 though as if fully stated herein.
13. Answering Paragraph 13 of the Complaint, Fannie Mae denies the allegations contained therein.
14. Answering Paragraph 14 of the Complaint, Fannie Mae denies the allegations contained therein.
15. Answering Paragraph 15 of the Complaint, Fannie Mae denies that Plaintiff is entitled to the relief requested.
16. Answering Paragraph 16 of the Complaint, Fannie Mae denies that Plaintiff is entitled to the relief requested.
17. Fannie Mae repeats and incorporates each of its responses to Paragraph 1 through 16 though as if fully stated herein.
18. Answering Paragraph 18 of the Complaint, Fannie Mae admits that Plaintiff seeks the referenced relief and denies that Plaintiff is entitled to the relief requested.
19. Answering Paragraph 19 of the Complaint, Fannie Mae admits that Plaintiff seeks the referenced relief and denies that Plaintiff is entitled to the relief requested.
1. The Complaint, and each and every alleged cause of action contained therein, fails to state a suitable and cognizable claim upon which relief may be granted.
2. The foreclosure sale at issue did not extinguish the prior recorded first priority deed of trust because the foreclosing entity and/or its agents failed to satisfy the requirement of Nevada Revised Statute Chapter 116.
3. Fannie Mae cannot be deprived of its interest in the Property in violation of the Procedural Due Process Clause of the Fourteenth Amendment of the United States Constitution and Article 1, Sec. 8, of the Nevada Constitution.
4. Fannie Mae cannot be deprived of its interest in the Property in violation of federal law.
5. Plaintiff's claim of free and clear title to the Property is barred by 12 U.S.C. § 4617(j)(3), which precludes a foreclosure sale of a homeowner's association assessment lien from extinguishing Fannie Mae's interest in the Property and preempts any state law to the contrary.
6. The foreclosure sale through which LNM alleges it obtained title to the Property is void as to Fannie Mae due to deficiencies in notice required pursuant to N.R.S. §§ 107.090 and 116.31168 and LNM is not a bona fide purchaser.
7. The foreclosure sale through which LNM alleges it obtained title to the Property is void as to Fannie Mae as the lien that was foreclosed contained improper amounts and was, thus, not authorized by statute and LNM is not a bona fide purchaser.
8. The foreclosure sale through which LNM alleges it obtained title to the Property is void as being held in a commercially unreasonable manner as to Fannie Mae and LNM is not a bona fide purchaser.
9. The foreclosure sale by which LNM alleges it obtained title to Property is void for failure to comply with the statutory requirements and LNM is not a bona fide purchaser.
10. Fannie Mae acted in good faith at all times.
11. By its own conduct, LNM is estopped from making the claims herein.
12. LNM's claims are barred by the doctrine of laches and/or unclean hands.
13. LNM's claims are barred by the doctrine of equitable estoppel.
14. LNM failed to comply with the statutory requirements for perfecting its alleged interest in the Property, if any, and thus cannot obtain the relief requested from the Court.
15. LNM waived any right that it may have had for relief from the Court.
16. LNM claims are barred by the applicable statute of limitations.
17. LNM would be unjustly enriched if it was to obtain title to the Property without recognition of the superior interest of Fannie Mae and without payment of either the amount due on the loan or the fair market value of the Property.
18. LNM has, through its own acts and/or omissions, failed to mitigate its damages, the existence of which are denied, and has therefore been released and discharged from any liability.
19. The matters complained of in the Complaint were proximately caused, in whole or in part, by the negligence of a third party or parties, or the negligence of LNM.
20. The matters complained of in the Complaint were proximately caused, in whole or in part, by the acts or omissions of a third party of parties, or by LNM. Accordingly, the liability of Fannie Mae and responsible parties, named or unnamed, should be apportioned and the liability, if any of Fannie Mae should be reduced accordingly.
21. Fannie Mae owed no duty to LNM.
22. Fannie Mae complied with all relevant Nevada and Federal statutes governing the relationship, if any, between LNM and Fannie Mae in regard to the conduct alleged in the Complaint.
23. LNM has not stated any basis to rescind any instrument or lien in favor of Fannie Mae that encumbers the Property.
24. Fannie Mae alleges that at this time it has insufficient knowledge or information on which to form a belief as to whether it may have additional, as yet unstated, affirmative defenses available. Therefore, Fannie Mae reserves the right to assert additional affirmative defenses in the event that discovery indicates that such unstated affirmative defenses are appropriate.
1. That LNM take nothing by way of its Complaint;
2. For an award on behalf of Fannie Mae for its attorney's fees and costs incurred in responding to LNM's Complaint;
3. For costs of suit; and
4. For such other and further relief as the Court may deem proper and/or just.
COMES NOW, Proposed Intervenor/Counterclaimant, FEDERAL NATIONAL MORTGAGE ASSOCIATION ("Fannie Mae"), by and through its counsel of record, LAUREL I. HANDLEY, ESQ., and KRISTA J. NIELSON, ESQ., of PITE DUNCAN, LLP, and for its causes of action against Plaintiff/Counter-Defendant, LN MANAGEMENT LLC SERIES 7937 SIERRA RIM ("LNM") and Counter-Defendant, ELKHORN COMMUNITY ASSOCIATION ("Elkhorn CA") and alleges as follows:
1. Fannie Mae is "a corporation organized and existing under the laws of the United States with its principal place of business in Washington, D.C." Fannie Mae is deemed a citizen of the District of Columbia for jurisdictional purposes in civil cases. 12 U.S.C. § 1717(a)(2)(B).
2. Fannie Mae was established as a government sponsored enterprise to provide stability and liquidity in the secondary mortgage market. 12 U.S.C. § 1716(1), (4). Pursuant to its statutory mission, Fannie Mae owns or guarantees millions of home loans throughout the United States, many of which are associated with properties located in the State of Nevada.
3. On September 6, 2008, the Director of Federal Housing Finance Agency ("FHFA"), authorized by the Housing and Economic Recovery Act of 2008 ("HERA"), Pub. L. No. 110-289, 122 Stat. 2654, codified at 12 U.S.C. § 4617 et seq., placed Fannie Mae into conservatorship and appointed FHFA as Conservator.
4. Counter-Defendant, LNM, is upon information and belief a Nevada limited-liability company with its principal place of business in Nevada.
5. Counter-Defendant, Elkhorn CA, is a Nevada non-profit corporation with its principal place of business in Clark County, Nevada.
6. This Court has original jurisdiction over this action pursuant to 28 U.S.C. § 1331. because: (1) the claims asserted arise under the laws of the United States; and (2) Fannie Mae's corporate charter confers federal question jurisdiction over claims by brought Fannie Mae. See Lightfoot v. Cendant Mortg. Corp., 769 F.3d 681 (9th Cir. 2014).
7. Venue is proper in this judicial district pursuant to 28 U.S.C. §§ 1391(b)(1)-(2) because Counter-Defendants reside in this district; a substantial part of the events or omissions giving rise to these claims occurred in this district; and the real property that is the subject of this action is situated in this district.
8. The Court has personal jurisdiction over Counter-Defendant LNM because this lawsuit arises out of and is connected with LNM's purposeful purchase of an interest in real property situated in Nevada and, upon information and belief, LNM is a Nevada limited-liability company.
9. The Court has personal jurisdiction over Elkhorn CA because this lawsuit arises out of and is connected with Elkhorn CA's foreclosure of real property located in Nevada and, upon information and belief, Elkhorn CA is a Nevada corporation.
10. This action centers on the parties' rights in that certain real property commonly described as 7937 Sierra Rim Drive, Las Vegas, Nevada 89131; APN 125-21-511-013 (the "Property"). The Property is legally described as follows:
11. Fannie Mae has interest in a first priority Deed of Trust ("Deed of Trust") encumbering the Property. A true and correct copy of the Deed of Trust is attached hereto as Exhibit "1".
12. On or about June 24, 2004, Benjamin T. Pfeiffer and Sabrina S. Pfeiffer borrowed $121,000.00 from Nevada State Bank (the "Pfeiffer Loan"). As part of the loan transaction, Mr. and Mrs. Pfeiffer executed a Promissory Note, which was secured by a Deed of Trust encumbering the Property. (See Exhibit "1").
13. The Deed of Trust was recorded on July 2, 2004, in the Official Records of Clark County, Nevada as Instrument No.: 20040702-0001246. (See Exhibit "1"). The original beneficiary under the Deed of Trust was Nevada State Bank.
14. On July 2, 2004, an Assignment of Mortgage was recorded, reflecting that Nevada State Bank had assigned its beneficial interest in the Deed of Trust to Mortgage Electronic Registration Systems, Inc. ("MERS"). A true and correct copy of the Assignment of Mortgage is attached hereto as Exhibit "2".
15. Fannie Mae purchased the Pfeiffer Loan on or about October 1, 2004.
16. On April 12, 2012, a Corporate Assignment of Deed of Trust was recorded, reflecting that MERS had assigned its beneficial interest in the Deed of Trust to CitiMortgage, Inc. ("CMI"). A true and correct copy of the Corporate Assignment of Deed of Trust is attached hereto as Exhibit "3".
17. CMI is the duly authorized servicer for the Pfeiffer Loan, which is owned by Fannie Mae.
18. Elkhorn CA claimed an interest in the Property pursuant to a Notice of Delinquent Assessment Lien ("HOA Lien"). A true and correct copy of the HOA Lien is attached hereto as Exhibit "4".
19. The HOA Lien indicated the total amount due was $977.10.
20. Absolute Collection Services ("ACS"), as agent for Elkhorn CA, recorded the HOA Lien on November 14, 2012, in the Official Records of Clark County, Nevada as Instrument No. 201211140001605. (See Exhibit "4").
21. On or about February 1, 2013, ACS acting on behalf of Elkhorn CA, recorded a Notice of Default and Election to Sell Under Homeowner's Association Lien ("Notice of Default") in the Official Records of Clark County, Nevada as Instrument No.: 201302010002957. A true and correct copy of the HOA Notice of Default is attached hereto as Exhibit "5".
22. The Notice of Default indicated the total amount due was $1,686.70 as of February 1, 2013. Fannie Mae is informed and believes that the amounts claimed in the Notice of Default improperly included "collection fees."
23. Thereafter, ACS, acting on behalf of Elkhorn CA, recorded a Notice of Trustee's Sale in the Official Records of Clark County, Nevada as Instrument No.: 201305230003766 ("Notice of Sale"). A true and correct copy of the Notice of Sale is attached hereto as Exhibit
24. The Notice of Sale is dated May 23, 2013, and indicated the total amount due was $3,427.55.
25. Fannie Mae is informed and believes that neither ACS nor Elkhorn CA advised Fannie Mae, its loan servicer, or its predecessors in interest that a portion of the HOA Lien may be able to attain priority over the Deed of Trust.
26. Neither the HOA Lien nor the Notice of Default nor the Notice of Sale specified what portion of the lien, if any, may attain priority over the Deed of Trust.
27. Neither the HOA Lien nor the Notice of Default nor the Notice of Sale specified the amount of the super-priority piece, if any, of the HOA Lien.
28. Neither the HOA Lien nor the Notice of Default nor the Notice of Sale specified the amount required to payoff the super-priority piece, if any, of the HOA Lien.
29. Elkhorn CA purportedly foreclosed on its HOA Lien on September 17, 2013 ("HOA Sale"). At the time of the HOA Sale, CMI was the servicer of the Pfeiffer Loan for Fannie Mae.
30. Following the HOA Sale, a Trustee's Deed Upon Sale was recorded in the Official Records of Clark County, Nevada as Instrument No. 201309200001394 ("Foreclosure Deed"). A true and correct copy of the Foreclosure Deed is attached hereto as Exhibit "7".
31. At no time did Plaintiff, Elkhorn CA or ACS obtain consent from FHFA to extinguish Fannie Mae's interest in the Deed of Trust and/or property.
32. Fannie Mae is informed and believes that at the HOA Sale, LNM was purportedly the highest bidder, with a bid of $4,701.00.
33. Fannie Mae is informed and believes that the unpaid debt due and owing to Elkhorn CA as of the date of the HOA Sale was $4,701.00 as stated in the Foreclosure Deed.
34. The Foreclosure Deed listed the transfer tax value of the property as $92,203.00.
35. Fannie Mae repeats and re-alleges the allegations contain in paragraphs 1 through 34 above.
36. Pursuant to 28 U.S.C. § 2201 and NRS § 40.010, this Court has the power and authority to resolve the parties adverse claims in the Property.
37. At the time of the HOA Sale, the Deed of Trust was a first secured interest on the Property.
38. LNM claims an interest in the Property through a Trustee's Deed Upon Sale recording in the Official Records of Clark County as Instrument No. 201309200001394 that is adverse to Fannie Mae's interest. LNM claims that the Property was conveyed to it free and clear of the Deed of Trust.
39. FHFA, as conservator, succeeded by law to "all rights, title, powers, and privileges" of Fannie Mae. 12 U.S.C. § 4617(b)(2)(A)(i).
40. Pursuant to 12 U.S.C. § 4617(j)(3), "[n]o property of [FHFA] shall be subject to levy, attachment, garnishment, foreclosure, or sale without the consent of the [FHFA], nor shall any involuntary lien attach to the property of [FHFA]."
41. Fannie Mae's interest at issue is the property of the Conservator. Therefore, applying NRS Chapter 116 or other state law in a manner that extinguishes Fannie Mae's interest in the Deed of Trust would violate 12 U.S.C. § 4617(j)(3).
42. At no time did Elkhorn CA or its trustee obtain consent from FHFA to extinguish Fannie Mae's interest in the Property.
43. Based on the adverse claims being asserted by the parties, the parties are entitled to a judicial determination regarding the rights and interests of the respective parties to the case.
44. At the time of the HOA Sale, Fannie Mae was an interested party as defined by N.R.S, § 107.090(1), as it claims a right, title or interest in, or lien or charge upon, the Property.
45. Fannie Mae has standing to prosecute this cause of action because the HOA Sale did cause Fannie Mae actual injury and Fannie Mae seeks redress from this Court.
46. Fannie Mae is entitled to a determination from this Court, pursuant to 28 U.S.C. § 2201 and N.R.S. § 40.0101, that the HOA Sale, if valid, did not extinguish the Deed of Trust, which continues to encumber the Property after the HOA Sale.
47. Fannie Mae is entitled to a determination from this Court, pursuant to 28 U.S.C. § 2201 and N.R.S. § 40.010, that Fannie Mae's interest is superior to the interest, if any, acquired by LNM through the Trustee's Deed Upon Sale.
48. In the alternative, Fannie Mae is entitled to a determination from this Court, pursuant to 28 U.S.C. § 2201 and N.R.S. § 40.010, the HOA Sale is unlawful and void under N.R.S. § 116.3102 et seq.
49. Fannie Mae has been required to retain counsel and is entitled to recover reasonable attorney's fees to prosecute this action.
50. Fannie Mae repeats and re-alleges the allegations contained in paragraphs 1 through 49 above.
51. This Court has the power and authority to declare Fannie Mae's rights and interest in the Property and to resolve the parties' adverse claims in the Property pursuant to 28 U.S.C. § 2201 and NRS § 30.040.
52. Fannie Mae has interest in a first priority security interest in the Property pursuant to the Deed of Trust.
53. Elkhorn CA and its agent ACS purported to conduct the HOA Sale pursuant to NRS Chapter 116. The HOA Sale purports to affect Fannie Mae's rights, status, legal relations and interest in the Property.
54. Fannie Mae contends that its rights and interest in the Property were not affected by the HOA Sale and that Fannie Mae continues to have a first priority security interest in the Property pursuant to the Deed of Trust.
55. A justiciable controversy exists between Fannie Mae and Counter-Defendants and Fannie Mae has a legally protectable interest in the controversy. The issue is ripe for judicial determination.
56. Fannie Mae is entitled to a declaration from this Court that 12 U.S.C. § 4617(j)(3) precludes the HOA Sale from extinguishing Fannie Mae's interest in the Property and that Fannie Mae's interest in the Property is superior to the interest, if any, acquired by LNM through the HOA Sale or held or claimed by any other party.
57. In the alternative, Fannie Mae is entitled to a determination from this Court that the HOA Sale was not a valid sale and conveyed no legitimate interest to LNM.
58. Fannie Mae has been required to retain counsel to prosecute this action and is entitled to recover reasonable attorney's fees to prosecute this action.
WHEREFORE, Proposed Intervenor/Counterclaimant prays for judgment against counter-defendants as follows:
Simultaneously with this Answer, the Federal Housing Finance Agency ("FHFA"), in its capacity as Conservator for the Federal National Mortgage Association ("Fannie Mae"), is filing jointly with other parties in this action a stipulation permitting FHFA to intervene pursuant to Federal Rule of Civil Procedure 24. In accordance with Rule 24(c)'s requirement that a motion to intervene "be accompanied by a pleading that sets out the claim or defense for which intervention is sought," FHFA submits this Answer to respond as follows to the Complaint filed by Plaintiff LN Management LLC Series 7937 Sierra RIM ("LN Management" or "Plaintiff'):
1. FHFA admits the allegations within Paragraph 1 of the Complaint.
2. FHFA is without knowledge or information sufficient to form a belief as to the truth of the allegations within Paragraph 2 of the Complaint.
3. FHFA admits that Benjamin T. Pfeiffer was a trustor under a Deed of Trust recorded in the Official Records of Clark County, Nevada as Instrument No.: 20040702-0001246, encumbering the real property located at 7937 Sierra Rim Drive, Las Vegas, Nevada 89131 ("Property"). FHFA is without knowledge or information sufficient to form a belief as to the truth of the remaining allegations within Paragraph 3 of the Complaint.
4. FHFA admits that Sabrina S. Pfeiffer was a trustor under a Deed of Trust recorded in the Official Records of Clark County, Nevada as Instrument No.: 20040702-0001246, encumbering the Property. FHFA is without knowledge or information sufficient to form a belief as to the truth of the remaining allegations within Paragraph 4 of the Complaint.
5. FHFA admits that CitiMortgage, Inc., is the successor beneficiary of a Deed of Trust recorded on July 2, 2004, in the Official Records of Clark County, Nevada as Instrument No.: 20040702-0001246 and that Fannie Mae is the owner of the corresponding loan. F1-112.A. also admits that Nevada State Bank was the original lender and beneficiary under the Deed of Trust. FHFA is without knowledge or information sufficient to form a belief as to the truth of the remaining allegations within Paragraph 5 of the Complaint.
6. FHFA is without knowledge or information sufficient to form a belief as to the truth of the allegations within Paragraph 6 of the Complaint.
7. FHFA admits that a Trustee's Deed Upon Sale was recorded on September 20, 2013, in the Official Records of Clark County, Nevada as Instrument No. 201309200001394. FHFA further admits that the Trustee's Deed Upon Sale states that Absolute Collection Services, LLC ("ACS"), "grant[s] and convey[s], but without warranty expressed or implied to: LN Management LLC, Series 7937 Sierra Rim, PO Box 36208, Las Vegas, NV 89133 (herein called Grantee), all its right, title and interest in that certain property situated in County of Clark, State of Nevada, described as follows: 7937 Sierra Rim Dr., Las Vegas, NV 89131. . ." Paragraph 7 also states legal conclusions that does not require a response. To the extent a response is required, denied.
8. FHFA admits that a Trustee's Deed Upon Sale was recorded on September 20, 2013, in the Official Records of Clark County, Nevada as Instrument No. 201309200001394. Fannie Mae further admits that the Trustee's Deed Upon Sale states that ACS, "grant[s] and convey[s], but without warranty expressed or implied to: LN Management LLC, Series 7937 Sierra Rim, PO Box 36208, Las Vegas, NV 89133 (herein called Grantee), all its right, title and interest in that certain property situated in County of Clark, State of Nevada, described as follows: 7937 Sierra Rim Dr., Las Vegas, NV 89131. . ." FHFA avers that this Trustee's Deed Upon Sale speaks for itself and denies any allegations that do not accurately reflect its text.
9. FHFA admits that FHFA and Fannie Mae had, and continue to have, an interest in the Property.
10. FHFA denies the allegations within Paragraph 10 of the Complaint.
11. FHFA is without knowledge or information sufficient to form a belief as to the truth of the allegations within Paragraph 11 of the Complaint.
12. FHFA repeats its responses to Paragraphs 1-11 as if fully stated herein.
13. FHFA denies the allegations within Paragraph 13 of the Complaint.
14. FHFA denies the allegations within Paragraph 14 of the Complaint.
15. Paragraph 15 states Plaintiff's claim for relief that does not require a response. To the extent a response is required, denied.
16. Paragraph 16 states Plaintiff's claim for relief that does not require a response. To the extent a response is required, denied.
17. FHFA repeats its responses to Paragraphs 1-16 as if fully stated herein.
18. Paragraph 18 states Plaintiff's claim for relief that does not require a response. To the extent a response is required, denied.
19. Paragraph 19 states Plaintiffs claim for relief that does not require a response. To the extent a response is required, denied.
FHFA's investigation of these claims is continuing. By this Answer, FHFA waives no affirmative defenses and reserves its right to amend the Answer to insert any subsequently discovered affirmative defenses.
The Complaint fails to state a claim for which relief can be granted because, among other reasons, Plaintiff's claim of free and clear title to the Property is barred by 12 U.S.C. § 4617(j)(3), which precludes a homeowners' association sale from extinguishing Fannie Mae's interest in the Property and preempts any state law to the contrary.
Plaintiffs claims are barred by the doctrines of lathes, estoppel, waiver, unjust enrichment, and/or unclean hands.
The damages, if any, that were allegedly sustained by Plaintiff as a result of the acts described in the Complaint were caused in whole or were contributed to in part by reason of the acts, omissions, negligence, and/or intentional misconduct of Plaintiff.
The damages, if any, that were allegedly sustained by Plaintiff as a result of the acts described in the Complaint were caused in whole or were contributed to in part by reason of the acts, omissions, negligence, and/or intentional misconduct of one or more third parties over whom neither FHFA nor Fannie Mae had control.
Plaintiff has an adequate remedy at law and has, through its own acts and/or omissions, failed to mitigate its damages, the existence of which are denied.
Plaintiff failed to join one or more indispensable parties.
Fannie Mae breached no duty with regard to Plaintiff.
1. FHFA incorporates by reference the responses of all previous paragraphs, as if fully set forth herein.
2. Pursuant to 28 U.S.C. § 2201 and NRS § 40.010, this Court has the power and authority to declare FHFA and Fannie Mae's rights and interests in the Property.
3. FHFA is an agency of the federal government of the United States of America and is also the Conservator for Fannie Mae.
4. The Conservator has succeeded by law to all of Fannie Mae's "rights, titles, powers, and privileges." 12 U.S.C. § 4617(b)(2)(A)(i).
5. During the Conservatorship, "[n]o property of [FHFA] shall be subject to levy, attachment, garnishment, foreclosure, or sale without the consent of the [FHFA], nor shall any involuntary lien attach to the property of [FHFA]." 12 U.S.C. § 4617(j)(3).
6. Fannie Mae's interest at issue is property of the Conservator. Therefore, applying NRS Chapter 116 or other state law in a manner that extinguishes Fannie Mae's interest in the Property would violate 12 U.S.C. § 4617(j)(3).
7. 12 U.S.C. § 4617(j)(3) preempts any state law that would permit a foreclosure on a superpriority lien to extinguish a property interest of Fannie Mae while it is under FHFA's conservatorship.
8. At no time did Plaintiff, Elkhorn Community Association, or the trustee or agent of either Plaintiff or Elkhorn Community Association obtain consent from FHFA to extinguish the Deed of Trust or otherwise extinguish Fannie Mae's interest.
9. Pursuant to 12 U.S.C. § 4617(j)(3), the foreclosure sale conducted by Elkhorn Community Association (the "HOA") could not extinguish Fannie Mae's interest in the Deed of Trust.
10. FHFA and Fannie Mae are entitled to a determination from this Court, pursuant to 28 U.S.C. § 2201 and NRS § 40.010, that 12 U.S.C. § 4617(j)(3) precludes an HOA sale from extinguishing Fannie Mae's interest in the Deed of Trust.
1. FHFA incorporates by reference the responses of all previous paragraphs, as if fully set forth herein.
2. Pursuant to 28 U.S.C. § 2201 and NRS § 40.010, this Court has the power and authority to resolve the Plaintiff's adverse claims in the Property.
3. The Deed of Trust is a first secured interest on the Property as intended by NRS 116.3116(2)(b).
4. HIM, as Fannie Mae's conservator, has succeeded by law to all of Fannie Mae's "rights, titles, powers, and privileges." 12 U.S.C. § 4617(b)(2)(A)(i).
5. Plaintiff claims an interest in the Property through its purported purchase of the Property at an HOA foreclosure sale on or about September 17, 2013, and claims that the foreclosure sale extinguished the Deed of Trust.
6. Pursuant to 12 U.S.C. § 4617(j)(3), "[n]o property of [FHFA] shall be subject to levy, attachment, garnishment, foreclosure, or sale without the consent of [FHFA], nor shall any involuntary lien attach to the property of [FHFA]."
7. Based on the adverse claims being asserted by the parties, FHFA and Fannie Mae are entitled to a judicial determination regarding the rights and interests of the respective parties to the case.
8. FHFA and Fannie Mae are entitled to a determination from this Court. pursuant to 28 U.S.C. § 2201 and NRS § 40.010, that the HOA sale did not extinguish Fannie Mae's interest in the Deed of Trust.
9. FHFA and Fannie Mae are entitled to a determination from this Court, pursuant to 28 U.S.C. § 2201 and NRS § 40.010 that Fannie Mae's interest in the Deed of Trust is superior to the interest, if any, acquired by Plaintiff through the foreclosure deed.
WHEREFORE, FHFA prays for the following relief:
1. That Plaintiff take nothing by way of its Complaint;
2. That the Court declare that 12 U.S.C. § 4617(j)(3) preempts any Nevada law that would permit a foreclosure on a superpriority lien to extinguish Fannie Mae's interest while it is under FHFA's conservatorship;
3. That the Court declare that the HOA sale did not extinguish Fannie Mae's interest in the Property and thus did not convey the Property free and clear to Plaintiff;
4. That the Court declare that Fannie Mae's property interest is superior to the interest, if any, of Plaintiff;
5. That FHFA be awarded reasonable attorneys' fees and costs; and
6. That FHFA receive such other relief as the Court deems just and proper.
