RICHARD F. BOULWARE, II, District Judge.
Before the Court is Defendant Bank of America, N.A.'s Motion for Judgment on the Pleadings under Federal Rule of Civil Procedure 12(c). ECF No. 15. For the reasons discussed herein, the Court dismisses the matter without prejudice and grants Plaintiff leave to move to reopen the matter after seeking clarification from the bankruptcy court on the at-issue bankruptcy orders.
Plaintiff sued Defendant in state court on February 28, 2018, alleging a single claim for declaratory relief to quiet title of a property. ECF No. 1-1. Defendant removed the matter to this Court on April 13, 2018 and answered the Complaint on May 7, 2018. ECF Nos. 1, 8. A Scheduling Order was entered on June 28, 2018. ECF No. 12.
Defendant now moves for Judgment on the Pleadings. ECF No. 15. Plaintiff opposed the motion, and Defendant replied. ECF Nos. 20, 23. The Court stayed this matter, per the parties' stipulation, pending resolution of the pending motion. ECF Nos. 25, 26.
This matter centers on the parties' interest in a property located at 3261 Bridge House, North Las Vegas, Nevada 89032.
In 2007, a deed of trust was recorded against the property. The deed of trust secured a promissory note executed by nonparty Alfredo Sanchez. On February 7, 2011, Sanchez filed a Chapter 7 Bankruptcy petition. The property was listed in the petition as a secured claim in the amount of $255,959.00. Sanchez was discharged from the bankruptcy matter on July 11, 2011.
Then, on April 24, 2014, the bankruptcy trustee moved to sell the property subject to all liens and encumbrances. Bankruptcy Judge Nakagawa granted the motion, imposing the following specific conditions:
Plaintiff purchased the property on June 9, 2014. On August 1, 2014, Judge Nakawaga signed an amended order to confirm that the debtor and Sanchez were the same individual. Judge Nakawaga explained via a footnote that the amended order was entered because Plaintiff could not record the deed of trust from the sale due to the variance in spelling of Sanchez's name on relevant documents. On August 28, 2014, Plaintiff then recorded the quitclaim deed, which was dated August 1, 2014. Thus, the quitclaim deed was recorded twenty-seven days after Judge Nakawaga's amended order was entered and after the date the quitclaim deed was executed. Plaintiff did not record the Bankruptcy Order or Amended Order.
On November 21, 2014, Plaintiff filed a Chapter 11 Bankruptcy petition. The property was listed as a secured claim in the petition. On March 26, 2015, Plaintiff moved to cramdown the first deed of trust. The notice of the motion did not include mailing to the proper Bank of America address listed on the first deed of trust. The motion was granted as unopposed on April 27, 2015, stating that the first deed of trust is partially unsecured beyond $56,000.00. Plaintiff's Second Amended Plan of Reorganization was later approved on October 21, 2016, which lists the value of the property at $56,000.00. Defendant never disputed Plaintiff's ownership in the property during Plaintiff's nor Sanchez's bankruptcy proceedings. Rather, Defendant reviewed and approved through its counsel the Bankruptcy Court's Order approving the Amended Plan of Reorganization. Defendant did so despite previously objecting to the confirmation of Plaintiff's proposed plan of reorganization as it related to another property.
Rule 12(c) states: "After the pleadings are closed—but early enough not to delay trial—a party may move for judgment on the pleadings." Fed. R. Civ. P. 12(c). The Ninth Circuit treats a Rule 12(c) motion as "functionally identical" to a Rule 12(b)(6) motion.
Defendant moves for judgment on the pleadings, arguing that Plaintiff claims title based on a void quitclaim deed since the deed was not recorded in compliance with Judge Nakawaga's Bankruptcy Order—an order referenced on the face of the quitclaim deed. Defendant points to Plaintiff's failure to file the quitclaim within fourteen days and failure to file the Bankruptcy Order. Thus, Defendant contends that Plaintiff never acquired an interest in the property. Plaintiff therefore had no interest in the property when it moved the first deed of trust—a motion never served on Defendant at its proper address.
Plaintiff replies that Defendant's argument relies on an alleged sales agreement, which cannot be judicially noticed at this stage of the proceedings. Plaintiff also contends that a question of fact exists: whether the Trustee waived its right to have the Order recorded with the deed of trust by reaffirming the sale after the alleged deadline to record passed. Plaintiff finally argues that Defendant must be estopped from disputing Plaintiff's ownership interest under the doctrines of claim preclusion and collateral estoppel since Defendant was represented by counsel and an active participant in the bankruptcy proceedings for Sanchez and for Plaintiff. Despite actively participating, Defendant failed to contest Plaintiff's interest in the property until now—nearly two years after Plaintiff's Bankruptcy Plan was granted.
The Court finds that the instant dispute requires the interpretation of Judge Nakagawa's Orders. Specifically, the Court finds that the validity or invalidity of the initial transfer of the property from the estate to the Plaintiff depends upon the interpretation and application of Judge Nakagawa's two orders regarding sale of the property from the estate. This finding gives rise to bankruptcy court jurisdiction. "[I]t is well recognized that a bankruptcy court has the power to interpret and enforce its own orders."
Based on the foregoing, the Court therefore finds that the bankruptcy court, rather than this Court, is the proper court to address the dispute between the parties: whether the terms of the Bankruptcy Order automatically void the quitclaim deed. The Court dismisses this matter without prejudice and grants Plaintiff leave to move to reopen the matter, if necessary, after receiving an order from the bankruptcy court.