May 2023 – SCA Strong

Standard for granting NRCP 12(b)(5) motion to dismiss with prejudice

Warner v. Dillon, 92 Nev. 677, 679 (Nev. 1976) (“In determining whether to grant a motion to dismiss, the court is required to accept as true all evidence and reasonable inferences therefrom presented by the plaintiff. Gunlock v. New Frontier Hotel, 78 Nev. 182, 370 P.2d 682 (1962).”)

“However, in deciding whether to dismiss a complaint pursuant to NRCP 12 (b)(5), “[a]ll allegations pled must be accepted as true.” Bergmann v. Boyce, 109 Nev. 670, 674, 856 P.2d 560, 563 (1993). As * attr(page-number) Bergmann makes clear, the dispositive resolution of questions of fact is not a part of a motion to dismiss on the pleadings.

Brinson v. Jackson, No. CV412-105, at *2 (S.D. Ga. Mar. 20, 2013) (“the Court can only grant a dismissal motion if it is legally supported”)

A motion to dismiss is not considered a responsive pleading, so a plaintiff is free to amend his complaint to eliminate questions about its legal sufficiency, the 4th DCA said.

Federal Rule of Civil Procedure (FRCP) 12 governs federal motions to dismiss. A defendant making a motion to dismiss must do so before filing an answer or other responsive pleading, and the motion is generally due when the defendant’s answer would have been due (see FRCP 12(b)).

“To survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted as true, to ‘state a claim to relief that is plausible on its face.

Manuela Rubio v. Nevada, 124 Nev. 1032, 1044 (Nev. 2008) (“As other jurisdictions have required, we recognize that district courts should hold an evidentiary hearing for colorable claims of affirmative misrepresentation.”)

A failure to plead with sufficient particularity does not warrant a dismissal of the action with prejudice”.”

Occhiuto v. Occhiuto, 97 Nev. 143, 146 (Nev. 1981) (“Although appellant has not stated the claimed fraud with particularity and thus has failed to comply with NRCP 9(b) upon the authority of Savage v. Salzmann, supra, “A failure to plead with sufficient particularity does not warrant a dismissal of the action with prejudice”.”)

A motion to dismiss under NRCP 12(b)(5) is subject to a rigorous standard of review on appeal

Nevada Power Co. v. Haggerty, 115 Nev. 353, 358 (Nev. 1999) (“In reviewing orders granting motions to dismiss, this court considers whether the challenged pleading sets forth allegations sufficient to establish the elements of a right to relief. Pemberton v. Farmers Ins. Exchange, 109 Nev. 789, 792, 858 P.2d 380, 381 (1993). In making its determination, this court is to accept all factual allegations in the complaint as true. Id. at 792, 858 P.2d at 381 (citing Marcoz v. Summa Corporation, 106 Nev. 737, 739, 801 P.2d 1346, 1347 (1990)).”)

A motion to dismiss is not considered a responsive pleading, so a plaintiff is free to amend his complaint to eliminate questions about its legal sufficiency

Seput v. Lacayo, 122 Nev. 499, 501 (Nev. 2006) (“A motion to dismiss under NRCP 12(b)(5) is subject to a rigorous standard of review on appeal. “All factual allegations in the complaint are [viewed] as true, and all inferences are drawn in favor of the non-moving party.” Further, “[a] complaint should only be dismissed if it appears beyond a reasonable doubt that the plaintiff could prove no set of facts, which, if true, would entitle him to relief. Dismissal is proper where the allegations are insufficient to establish the elements of a claim for relief.” The district court’s conclusions of law are subject to our de novo review.”)

Hampe v. Foote, 118 Nev. 405, 408, 47 P.3d 438, 439 (2002).

Keife v. Logan, 119 Nev. 372, 374, 75 P.3d 357, 359 (2003).

Squires v. Sierra Nev. Educational Found, 107 Nev. 902, 905 (Nev. 1991) (“The standard of review for dismissals under NRCP 12(b)(5) is rigorous. The court “must construe the pleading liberally and draw every fair intendment in favor of the [appellant].” Merluzzi v. Larson, 96 Nev. 409, 411, 610 P.2d 739, 741 (1980) (citing San Diego Prestressed Concrete Co. v. Chicago Title Ins. Corp., 92 Nev. 569, 573, 555 P.2d 484, 487 (1976)). However, the appellant must have presented some relevant legal authority in support of his contention. Plankinton v. Nye County, 95 Nev. 12, 588 P.2d 1025 (1979). In addition, all factual allegations of the complaint must be accepted as true. Hynds Plumbing v. Clark Co. Sch. Dist., 94 Nev. 776, 777, 587 P.2d 1331, 1332 (1978).”)

Mesi v. Mesi, 478 P.3d 366, 371 (Nev. 2020) (“Although efficiency is normally “best served when motions to stay proceedings are discouraged,” see Aspen Fin. Servs., Inc. v. Eighth Judicial Dist. Court , 128 Nev. 635, 649, 289 P.3d 201, 210 (2012) (internal quotation marks omitted), the situation is different when a court has already decided to defer jurisdiction and is only choosing whether to stay or dismiss. Cf. id. at 649 n.5, 289 P.3d at 210 n.5 (noting that “courts occasionally find a stay will in fact promote judicial efficiency”). If the first-filed suit is dismissed, the second court’s stay can be lifted and the action can proceed without the need for a wasteful new filing. See Alltrade , 946 F.2d at 629. Conversely, if the first court determines that it does have jurisdiction, the second action can be dismissed without difficulty. See id.”)

Allegations of misconduct against Nationstar attorneys

On 12/19/22, I filed a motion for an order to show cause why written findings of attorney misconduct should not be forwarded to the State Bar because the State Bar would not investigate complaints without it.

Below is my statement of intent which was to clearly show that my claims had been obstructed and never fully heard due to the misconduct of my opponents.

The motion was made in good faith and supported by verified evidence

Summary of 2/23/22 and 2/28/22 Bar complaints against Nationstar’s attorneys

Nationstar’s attorneys: Wright, Finlay, Zak, LLP

Melanie Morgan (SBN 8215) Akerman LLP

2/28/22 Complaint to State Bar vs. Nationstar’s attorneys: Wright, Finlay, Zak, LLP and

2/23/22 Complaint to Bar vs. Nationstar attorneys Melanie Morgan (SBN 8215) Akerman

Nationstar’s attorneys: Melanie Morgan, Managing Partner Akerman LLP and Wright Finlay Zak, LLP lied about Nationstar being owed a debt; lied about Nationstar having any standing to file a quiet title claim. Abused the HOA quiet title litigation process multiple times as a corrupt business model, representing different lenders who did not NRS 104.3301 standing to foreclose on the 1^st deeds of trust they were lying about owning.

The most critical material facts knowingly misrepresented by all of Nationstar’s attorneys related to the assignments and reconveyance of the 1^st deed of trust that was extinguished by the 8/15/14 HOA sale: 7/22/04 Hansen deed of trust
4/12/12 ASSIGN MERS to BANA by BANA – could not transfer interest:
1) assignment to BANA was void as it was robo-signed days after BANA signed a 4/4/12 consent decree agreeing not to robo-sign documents to fake ownership of loans that basically had been securitized out of existence;
2) also void because there is no notary record of it (NRS 111.240);
3) also void because non-compliant with Nevada’s anti-foreclosure fraud law (AB 284 (2011)
9/9/14 ASSIGN BANA to Wells Fargo by BANA – could not transfer interest:
1) assignment is void as BANA’s 4/12/12 assignment to itself above was void;
2) assignment was recorded almost a month after the deed of trust was extinguished by the 8/15/14 HOA sale;
3) servicing banks BANA’s and Nationstar’s failure to record a notice of default on the 7/22/04 deed of trust constitutes a waiver of any right it may have to use the property as security for the Hansen promissory note;
4) servicers’ failure to record a notice of default was the direct and proximate cause of the HOA sale because an HOA is prohibited from foreclosing if a lender has recorded a notice of default on the 1^st deed of trust (NRS 116.31162(6)(2013)
12/1/14 ASSIGN BANA to Nationstar by Nationstar – could not transfer interest:
1) void because BANA had no interest to assign on 12/1/14;
2) void because it was actually a self-assignment executed without authority by Nationstar;
3) void because Nationstar did not record or disclose a properly executed power of attorney from BANA;
4) void because Nationstar rescinded it a week after the end of discovery in the 1^st action
3/8/19 ASSIGN Wells Fargo to Nationstar by Nationstar – could not transfer interest:
1) void because Wells Fargo had no interest to assign to Nationstar;
2) void because Nationstar’s robo-signer executed it without authority;
3) void because Nationstar recorded it after the end of discovery in the 1^st action;
4) void because Nationstar prevailed in the 1^st action by filing a non-meritorious joinder on 2/12/19 claiming to be BANA’s successor in interest and then two weeks later rescinding that claim and then after the end of discovery recording a new robo-signed claim to be Wells Fargo’s successor in interest;
5) Nationstar is judicially estopped from claiming that either it or Wells Fargo is the beneficiary due to its repeated conflicting claims regarding when and from whom it acquired its claimed interest;
6) Nationstar admitted i n discovery two days after this robo-signed assignment was executed on 2/25/19 that Nationstar was then, and always had been since 12/1/13, only the servicer, never the beneficiary.
3/8/19 RESCIND 12/1/14 BANA to Nationstar by Nationstar – could not transfer interest as it was rescinding a void assignment:
1) this rescission was done in bad faith a week after discovery ended after Nationstar learned that Tobin could prove that it was lying about being the beneficiary as BANA’s successor in interest; 2) this was executed by Nationstar robo-signer Mohamed Hammed posing as if he were the V-P of BANA;
3) In the months following this rescission, Nationstar persisted in its false claim that the sale was valid to extinguish Tobin’s interest by was void to extinguish the interest Nationstar was lying about owning as the successor of BANA
6/3/19 RECONVEY Hansen DOT to Joel Stokes – not to the borrower’s estate – by Nationstar
1) void because Nationstar did not have the legal authority to reconvey the deed of trust to anyone, let alone to a non-party two days before the quiet title trial in the 1^st action;
2) void as Nationstar claimed to be both the trustee and the beneficiary when in fact it was neither and therefore had no legal authority to record a reconveyance (NRS 205.395);
3) Nationstar could not have been both the trustee and the beneficiary as NRS 107.028(2) prohibits it;
4) void as it was a fraudulent transfer (NRS 111.175) to consummate the $355,000 devil’s pact between Nationstar and Jimijack recorded on 5/23/19;
5) underlying deal with Joel Stokes is void as the attorneys misrepresented it as the Nationstar-Jimijack settlement of all claims to the court to gain its imprimatur fraudulently;
5) void as the Nationstar-Joel Stokes deal excluded Tobin as a necessary party (NRCP 19, NRS 30.130) as she was denied the opportunity to defend her 3/28/17 deed;
6) void as the lien was released as a quid pro quo to steal Tobin’s property by obstructing her claims from being heard on their merits;
7) void as this was recorded when Tobin as an individual and as the Hansen Trust trustee had pending quiet title claims against Jimijack to void the defective HOA sale subject to the deed of trust, i.e., Jimijack’s deed was defective and inadmissible as evidence of title (NRS 111.345) and so if Tobin’s claims had been heard on the merits, Jimijack would have lost. Nationstar knew that Tobin knew it did not have standing to foreclose on her if the title was unwound to put her and Nationstar back as if the sale had never happened. The ONLY way they could both win was to obstruct Tobin’s case from being heard and tell the court that they settled the title dispute out of court.
7) void as Nationstar never produced any evidence that it had any legal right to collect $355,000 in exchange for releasing a lien it did not own;
7) underlying deal with Joel Stokes is void as Nationstar dismissed all its quiet title claims without adjudication;
8) void as Nationstar essentially confiscated Tobin’s property without foreclosure and without adjudication, by lying about being the beneficiary and abusing the HOA quiet title litigation process to collect on a debt it was not owed.
9) void as Nationstar circumvented the restrictions of the PUD Rider Remedies (F) to turn the alleged payment of delinquent HOA assessments into a de facto foreclosure without notice of due process required by NRS 107.080.

Summary of Bar Complaint against Melanie Morgan

1. Met ex parte with Judge Kishner on 4/23/19 after serving notice on all parties through the court’s e-file Odyssey system on 4/15/19 and 4/22/19 that the hearing was continued to 5/7/19 (NCJC 2.9, NRPC 8.4 and ABA standard 6.31(b))
2. As the managing partner over multiple subordinate attorneys, and as the successor of Nationstar’s and BANA’s prior attorneys, Wright, Finley, Zak, perpetrated fraud on the court
by misrepresenting to the court the material facts, (e.g., 1) that Nationstar was owed a debt from the 7/22/04 deed of trust that was extinguished by the disputed 8/15/14 HOA sale,
2) that Nona Tobin had not been granted leave to intervene as an individual
3) that Tobin’s 3/28/17 deed did not give her NRS 40.010 standing anyway
4) that the HOA sale was valid for the sub-priority portion of the lien),
5) changed attorneys to create plausible deniability, e.g., removed Karen Whelan after Joe Coppedge asked Nationstar in 2018 to join Tobin in an MSJ to void the sale in its entirety
6) in A-21-828840-C when Nationstar was going to have to respond to Tobin’s claim that it was judicially estopped from claiming to be owed a debt from the Hansen 7/22/04 deed of trust),
7) concealed inculpatory evidence (e.g., all Equator records, communications between Nationstar and Tobin or Nationstar and Red Rock or Nationstar and Wells Fargo) on these dates: 5/15/18, 12/10/18, 2/7/19, 2/12/19, 2/12/19, 2/20/19, 2/21/19, 2/21/19, 2/27/19, 2/28/19, 2/28/19, 3/7/19, 3/12/19, 3/12/19, 3/18/19, 3/21/19, 3/26/19 RTRAN, 4/12/19, 4/15/19, 4/19/19, 4/22/19, 4/23/19, 4/23/19 RTRAN, 4/25/19 RTRAN, 5/3/19, 5/21/19 RTRAN, 5/29/19 RTRAN, 5/31/19, 6/24/19, 6/24/19, 6/25/19, 7/1/19, 7/22/19, 6/25/20, 8/11/20, 4/9/21, 4/26/21, 5/3/21, 5/5/21, 8/19/21, 11/9/21, 11/15/21, 11/16/21, 11/23/21, 11/30/21.
3. In conspiracy with Joseph Hong, made a fraudulent side deal with Joel A. Stokes, that a) was mischaracterized to the court (5/21/19 transcript) status check-settlement documents) as a “Nationstar-Jimijack settlement of all claims” that was recorded on 5/23/19, and
b) which allowed Nationstar to be dismissed from the quiet title trial
c) so it did not have to produce any evidence to support its quiet title claim
and d) evaded either Nationstar or Jimijack having to refute Tobin’s quiet title claims on their merits.
2/23/22 Bar complaint filed against Melanie Morgan Petitioner’s 84371 appendix volume 27 (22-08189) (pages 4045-4154) was supported by exhibits of multiple unadjudicated administrative claims against Nationstar and Akerman.
On 2/23/22, Tobin, as the President of Fight Foreclosure Fraud, Inc., filed a complaint against Nationstar’s attorney, Wright, Finlay, Zak, LLP (“WFZ”) that initiated Nationstar’s meritless quiet title complaint. The bar complaint is filed concurrently as a Request for Judicial Notice because it their duplicitous filings are the corrupt foundation of this dispute. However, they ceased to be Nationstar’s attorneys on 4/10/18 when Akerman took over.
WFZ aided and abetted mortgage servicing fraud of both Bank of America and Nationstar Mortgage by filing into this quiet title civil dispute statements known to be false and disclosing false evidence on 1/11/16, 4/12/16 DECL, 4/12/16, 5/10/16, 6/2/16, 6/3/16, 6/10/16, 3/27/17 DECL , 3/27/17, 11/9/17, 2/9/18.
Assisting lenders to cheat homeowners is WFZ’s business model.
Movant requests the court determine if written findings against the WFZ attorneys separate from Nationstar are appropriate given that the four-year statute of limitations for complaints to be addressed by the Bar has passed, but the five-year statute of limitations for racketeering has not.

Allegations of misconduct against Red Rock Financial Services attorney

The motion was made in good faith and supported by verified evidence

Summary of 3/1/22 complaint to the State Bar vs. Red Rock attorney Steven Scow, Koch & Scow LLC

Steven Scow, Koch & Scow LLC is the attorney for Red Rock Financial Services, a partnership (EIN 88-0358132) that conducted the disputed HOA foreclosure sale usurping the statutory authority of the HOA.
Scow knew that this critical case-concluding phrase in the 4/18/19 order was false, “The totality of the facts evidence that the HOA properly followed the processes and procedures in foreclosing upon the Property”.
Despite knowing the order was based on the false evidence Scow himself produced, Scow and/or other attorneys under his direction, repeatedly relied on it in meritless filings and court hearings that succeeded in obstructing a fair adjudication of Tobin’s claims based solely on verified evidence on at least these dates: 6/23/20, 8/3/20, 8/11/20, 4/16/21, 4/27/21, 4/29/21, 5/11/21, 8/19/21, 10/22/21, 11/16/21, 12/28/21, 1/19/22, 5/25/22, 6/13/22.
The 3/1/22 complaint overview to the Bar vs. Scow and table of contents of exhibits are quoted here:
3/1/22 complaint to the State Bar vs. Steven Scow (SBN 9906) is quoted/summarized here:
Steven Scow, the subject of this instant complaint, represents Red Rock Financial Services, a partnership (EIN 88-0358132), that secretly sold my late fiancé’s house allegedly at a properly noticed and conducted HOA sale.
Steven Scow produced false evidence and concealed inculpatory evidence in response to my 2/4/19 subpoena that was relied on by the court to grant a meritless motion for summary judgment for quiet title by the HOA (even though the HOA had no interest in the title to protect). Upon information and belief, the HOA filed the motion for improper purposes, i.e., to cover up the fraudulent conduct of the sale and/or to retaliate against me for being a whistleblower.
The HOA’s motion, and Nationstar’s equally meritless joinder, were granted by the order entered on 4/18/19 by the court’s relying solely on Steven Scow-produced Red Rock’s unverified, uncorroborated, and sometimes blatantly falsified, foreclosure record.
Steven Scow’s and David Ochoa’s fraudulent misrepresentation to the court of the Red Rock unverified file as the HOA’s official records, is the proximate and direct cause of three more years of litigation for which I have accrued $317,532.76 in attorneys’ fees and much more in personal and financial cost.
All subsequent orders in district court cases A-15-720032-C, A-19-799890-C, A-21-828840-C and in appeals 79295 and 82294 were the fruit of this poison tree of falsified documents used to inaccurately depict the HOA sale as compliant with all legal requirements in Nevada statutes and the HOA governing documents.
My complaint against Steven Scow is much larger than my individual case. It also focuses on his refusal to distribute the excess proceeds from this sale (despite my repeated unheard civil and administrative claims), AND from a dozen other Sun City Anthem 2014 sales, AND from an unknown number of other sales conducted by Red Rock over the years.
3/1/22 complaint to the State Bar vs. Steven Scow (SBN 9906was supported by the following exhibits that were rejected by the Assistant Bar Counsel without the investigation required by SCR 104(1)(a):
Exhibit A Scow presented false evidence in response to Tobin’s 2/4/19 subpoena.
Exhibit B Scow unlawfully (NRS116.31164(3)(c)(2013) retained, to this day, the excess proceeds of Sun City Anthem HOA foreclosure sales after Red Rock instructed him to remit checks to court for interpleader in 2014.
Exhibit C Scow also unlawfully retained excess proceeds from foreclosures by other HOAs after Red Rock instructed him to remit checks to court for interpleader in 2014.
Exhibit D Scow did not produce subpoenaed documents that contained inculpatory evidence without claiming privilege.
Exhibit E Steven Scow failed to identify the partners who are unfairly profiting by these statutorily non-compliant sales and Scow’s failure to distribute the excess proceeds.
Exhibit F Steven Scow filed meritless claims, motions, and oppositions to evade judicial scrutiny of inculpatory evidence.
Exhibit G-1 SCA Board did not comply with HOA meeting laws after being intentionally misinformed about the law by Scow’s clients.
Exhibit G-2 Legal limits on closed HOA meetings in SCA governing documents were disregarded because Scow’s clients intentionally misinformed the SCA Board about them.
Exhibit H-1 “We can learn a lot from this Spanish Trail HOA case”
Exhibit H-2 “HOA debt collectors wield an unlawful level of power”
Exhibit H-3 “The House that took over a Life”
Exhibit H-4 Exhibit 5 of 3/8/21 Tobin’ A-21-828840-C Answer, Affirmative Defenses, and Counter-claims that shows that required notices for the sale were not provided, but the records were falsified to cover it up and “HOA collection practices cost us all more than you think” Cost more
Exhibit H-5 Call for an audit of the co-mingled, unaudited account(s) where Scow unlawfully (NRS116.31164(3)(c)(2013) retained the excess proceeds he was instructed to remit to the court in 2014.
Scow knew, but concealed that Red Rock unlawfully sold the property for $63,100 without notice on 8/15/14, three months after Nona Tobin had already been accepted the high bid of $367,500 on 5/8/14 from MZK Properties on auction.com, but that Nationstar would not let escrow close on a sale that was five times higher than the Red Rock sale.
Pages 14 to 20 of the draft complaint against Scow list and describe the specific false evidence he entered into the court record in response to subpoena.
False evidence (partial list) was entered into the court record via the Red Rock foreclosure file (RRFS 001-425).

RRFS 093-119 95 IS 277 119 IS 302.pdf– the date was scrubbed, Red Rock misrepresented to the Board “As of today, RRFS is unaware of any buyer that is lined up…” when Red Rock was aware the property had already been sold on auction.com three months earlier and Nationstar had sent a notice that it would pay one year of assessments to close escrow on the 5/8/14 auction.com sale.
RRFS 095 is SCA 277..png is a doctored combination of unrelated emails to misrepresent that no notice was actually sent to the owner in response to Nationstar’s 5/28/14 $1100 offer. Annotated version – (SCA 277)
RRFS 093-119 95 IS 277 119 IS 302.pdf is a letter that was provably never sent to 2763 White Sage on 7/2/14 as “no return to sender – deceased” was disclosed
RRFS 123 DATE SCRUBBED RE 140515 SCHEDULED SALE.pdf– date was scrubbed
RRFS 124 IS 140318 REQ 4 PAYOFF .pdf– on 3/18/14 Red Rock agent Christie Marling acknowledged Chicago Title’s request for payoff figures but asked to delay response until the Board reviewed a pending request for a waiver on 3/27/14. (RRFS 129)
RRFS 071-083 IS SCA 250-262 140815 ACCT DETAIL RES TRAN.pdf has scrubbed out the 3/18/14 Chicago Title request for payoff figures, the 3/27/14 Board approval of a $400 fee waiver, and the 3/28/14 Red Rock demand for $
RRFS 128 IS SCA 315.pdf and SCA 315 misrepresented how the Board approved the sale. Board Resolution R005-120513 at the 12/5/13 meeting did not approve the sale of this property or any other SCA property.
Red Rock concealed in discovery its 3/28/14 demand to Chicago Title that shows on page 6 that the board approved a $400 fee reduction and $18.81 interest reduction on 3/27/14.
Red Rock provided falsified accounts so that the Board’s approval of a $400 fee reduction and $18.81 interest reduction did not show as an entry on 3/27/14 on future ledgers. (RRFS 076) and (SCA 255) and (SCA 303) and (RRFS 103)
Red Rock concealed in discovery the applicable 4/27/12 debt collection contract that required Red Rock to indemnify Sun City Anthem and hold it harmless if any claims were brought alleging misconduct Red Rock’s part which caused a minimum of $150,000 in damages to the HOA.
RRFS 093-119 95 IS 277 119 IS 302.pdf is a falsified notice that was never sent to Tobin’s address at 2664 Olivia Heights Ave. as alleged. Tobin has stated multiple times under oath that she received no notice whatsoever from Red Rock after the 2/12/14 notice of the 3/7/14 sale which was not held because the property was in escrow with a $340,000 cash offer pending lender approval.
RRFS 189-190 RES TRAN NO PAGE NUMBERS.pdf scrubbed the sequentially-numbered page numbers 1335 and 1336 from the resident transaction report (Resident Transaction Reports for 2763 White Sage and Tobin’s address at 2664 Olivia Heights)
RRFS 398-399 RES TRAN 376.21 121205.pdf scrubbed the sequentially numbered page numbers 1334 and 1335 from the resident transaction report
RRFS 071-083 IS SCA 250-262 140815 ACCT DETAIL RES TRAN.pdf scrubbed the sequentially-numbered page numbers 1334 – 1336 from the resident transaction report
RRFS 071-083 IS SCA 250-262 140815 ACCT DETAIL RES TRAN.pdf Red Rock withheld in discovery all the financial transactions on resident transaction report pages 1336 – 1337 from 7/31/14 through 9/25/14, concealing thereby that the HOA has no record that 2763 White Sage was ever sold on 8/15/14, or any other date, and shows no entry in any ledger that confirms the alleged $63,100 was collected from a sale.
Red Rock concealed page 1337 of the Resident Transaction Report that shows that Jimijack – not Opportunity Homes – became the second owner of the property on 9/25/14 and that there is no record of Opportunity Homes LLC or F. Bondurant LLC ever owning the property.
RRFS 305 – 311 shows that Red Rock responded to a payoff request from Ticor Title on 5/29/13 with a demand for $3,055.47 three weeks after Red Rock covertly rejected the Miles Bauer $825 tender when only $825 in assessments were then delinquent.

What allegations of attorney misconduct were made against Sun City Anthem Attorneys

On 12/19/22, I filed a motion for an order to show cause why written findings of attorney misconduct should not be forwarded to the State Bar against David Ochoa and Adam Clarkson that was accompanied by a Request for Judicial Notice of a complaint filed with the State Bar.

The complaint had not been investigated by the State Bar as shown below. I had to get a court order with written findings before they would investigate these allegations.

Their actions prevented my quiet title case from being resolved fairly in 2017-2019.

They covered up the fraud of the HOA’s former agents by lying to the court and framing me.

David Ochoa, Lipson Neilson P. C., under direction from Adam Clarkson, The Clarkson Law Group, were the lawyers for Sun City Anthem Community Association, Inc., party in the first action who presented the falsified Red Rock foreclosure files to the court and misrepresented them as if they were the HOA’s concealed official records SCA’s attorneys filed a meritless motion for summary judgment to quiet a title in which the HOA held no interest and supported it with the falsified Red Rock records. SCA’s attorneys defamed Tobin and unlawfully removed her from her elected position on the HOA Board for being a party to the quiet title litigation of a house she inherited and have pursued a relentless campaign of harassment and retaliation against her over the past five years both for being a litigant herein and for being a whistleblower about other unrelated HOA matters.
SCA attorneys usurped the statutory authority of the HOA Board to enforce, and to impose fines and sanctions for alleged violations of, the HOA’s governing documents according to the terms of the Act (NRS 116). SCA attorneys obstructed Tobin’s access to Alternate Dispute Resolution (CC&Rs XVI, NRS 38.310) and then used abusive, potentially criminal (NRS 199.480(2)(c), NRS 199.210, NRS 193.130(d), NRS 199.145) litigation tactics to obstruct her ability to fully and fairly litigate her civil claims.
SCA attorneys acted in bad faith and did not serve the interests of the HOA or the common good of the HOA membership at large. The attorneys acted for their own self-interest (Clarkson) or in the interest of other parties (Clarkson and Ochoa), e.g., Sandy Seddon, Red Rock or the HOA’s insurance carrier
Defendant Ochoa made false statements to the court on at least these dates 3/28/17 RTRAN, 4/27/17 RTRAN, 5/23/17 RTRAN, 5/25/17 RTRAN, 3/26/19 RTRAN, 5/29/19 RTRAN, 9/3/19 RTRAN, 9/10/19 video, 9/10/19 minutes, submitted a false document to the court on these dates: 3/22/17, 3/27/17, 3/31/17, 4/18/17, 9/20/17. 4/20/18, 2/5/19, 3/6/19, 4/18/19, 5/2/19, 5/24/19, 5/31/19, 8/8/19, 8/9/19, 8/22/19, 11/22/19, 3/30/20, 7/1/20, or improperly withheld material information from the court on at least these dates: 5/31/18, 2/11/19, 2/26/19, 2/26/19, and caused serious injury to Tobin as an individual, and caused a significant adverse effect on the legal proceeding.
Ochoa knew that this phrase that he wrote into the 4/18/19 order was false,

“The totality of the facts evidence that the HOA properly followed the processes and procedures in foreclosing upon the Property”.

All documentary evidence, including declarations under penalty of perjury and sworn affidavits, put before the court on, inter alia, these dates: 9/23/16, 1/31/17, 3/3/17, 2/9/18, 5/31/18, 7/13/18, 12/5/18, 2/7/19, 2/12/19, 2/20/19, 2/26/19, 2/26/9, 2/27/19, 2/28/19. 2/28/19, 4/10/19, 4/12/19, 4/17/19, 4/24/19, 4/29/19, 5/23/19, 8/20/19, 8/26/19 – support the Tobin/Hansen Trust claims. However, the court relied solely on misrepresentations and false evidence by Ochoa and other opposing counsels, to adopt the erroneous orders entered on 4/18/19, 5/31/19 and 6/24/19.
Despite knowing the order was based on the false evidence Ochoa himself produced or the true evidence that he himself concealed and withheld, Ochoa and/or other attorneys under his direction, repeatedly relied on it in meritless filings and court hearings that succeeded in obstructing a fair adjudication of Tobin’s claims based solely on verified evidence on at least these dates: 4/27/17 RTRAN, 5/23/17 RTRAN, 5/25/17 RTRAN, 3/26/19 RTRAN, 5/29/19 RTRAN, 9/3/19 RTRAN, 9/10/19 video, 9/10/19 minutes, 3/22/17, 3/27/17, 3/31/17, 4/18/17, 9/20/17. 4/20/18, 2/5/19, 5/31/18, 2/11/19, 2/26/19, 2/26/19,
The order, authored by Ochoa, entered on 5/31/19, contains the false statements, completely unsupported by any verified evidence, (See EXHIBIT C of 3/6/22 Bar complaint.) that:

“The substantial exhibits that have been submitted in this case demonstrate that Nona Tobin as Trustee of the Trust was aware of the foreclosure and did nothing to stop the foreclosure. The May 2, 2019 (sic) Order, without addressing superpriority, establishes the HOA had a valid lien and properly noticed the foreclosure sale.”

Pages 48 to 55 of the draft complaint against Ochoa and Clarkson delineate the false evidence they entered into the court record primarily via records obtained from Steven Scow.
Exhibit A: Ochoa Obstructed Settlement
Exhibit C: Misrepresented and Suppressed Evidence
Exhibit D: Concealed Evidence
Exhibit E: Disclosed false & falsified evidence
Exhibit E-1 Disputed facts in Red Rock foreclosure file in SCA 176 – 643
Exhibit E-2 Examples of false evidence
Exhibit E-3 Red Rock Foreclosure file is false, falsified and disclosed as SCA 176-643
Exhibit F: Filed non-meritorious claims
Exhibit G: Concealed there were no Valid Board Actions
Exhibit G-1 Limits on closed HOA Board meetings
EXHIBIT G-2: SCA Board did not comply with HOA meeting laws
EXHIBIT G-3: SCA Board secretly sold a dozen houses in 2014
EXHIBIT G-4 SCA Board did not properly authorize any foreclosures conducted by Red Rock Financial Services in SCA 2012-2014 agendas and minutes excerpted for items related to foreclosure or debt
Exhibit G-5 is 5/23/19 Exhibit 5 “No valid board authorization for the sale” was misrepresented by David Ochoa and ignored by the court
Exhibit H – More disputed facts in the order (NEO 4/18/19) that granted the HOA MSJ and Nationstar joinder

Clarkson unlawfully removed me from my elected seat on the SCA Board in 2017 and has obstructed my running every year since

What happened after Sun City Anthem refused Nona’s 2017 offer to settle?

HOA attorneys refused ADR and a no-cost settlement offer and litigation has continued into 2023

SCA CC&Rs require Alternate Dispute Resolution – but the attorneys blocked it

HOA attorneys forced litigation and then obstructed it

What the motion to disqualify Judge Peterson seeks

The motion seeks orders from Chief Judge as Judge Peterson’s impartiality in this case can reasonably be questioned

Disqualify Judge Peterson from this case only pursuant to NCJC 2.2 (lack of fairness and impartiality); 2.6 (failure to ensure the right to be heard); 2.7 (failure to decide claims); 2.9 (improper ex parte communications); 2.15 (didn’t report attorney misconduct to the State Bar or take other appropriate actions)
Set aside the 3/28/23 order pursuant to NRCP 5959(a)(1)(A) (irregularity in the proceedings) or (B)(misconduct of prevailing party) (C) (ex parte vexatious litigant bench order in absentia and refusal to attach opposition to order) and/or NRCP 60(b)(1)(mistake, errors of law), NRCP 60(b)(3) (misrepresentation), NRCP 60(d)(3) (fraud on the court) and conduct an evidentiary hearing to establish by clear and convincing evidence that fraud on the court had obstructed a fair adjudication of my claims
Alternatively, simply set aside the 3/28/23 order as being outside the curt’s jurisdiction, unsupported by undisputed facts, containing findings that are not supported by evidence and improperly filed without allowing me to attach my opposition to it, and grant my 12/19/22 and 1/23/23 unopposed motions pending when Judge Peterson’s improper ex parte hearing unfairly exempted my opponents from meeting the requirements of EDCR 2.20, i.e., (filed a written opposition to motions)
By settling the jurisdictional question of standing first, based on evidence, facts, and law, striking rogue filings, and treating non-party Red Rock LLC exactly the way I was treated in the 1st action when I was removed from the case as an individual party before the trial, this case could be resolved immediately and fairly.

The Chief Judge is asked to balance the equities:

Should the Chief Judge disqualify Judge Peterson so another court can conduct the NRS 40.110 evidentiary hearing that has never been held to resolve Tobin’s title dispute?

vs.

Should the Chief Judge let stand an order that restricts Tobin’s filing any civil action vs. any defendant for any cause of action except if an attorney file it for her?

“Within 10 days after the service of the motion, and 5 days after service of any joinder to the motion, the opposing party must serve and file written notice of non-opposition or opposition thereto, together with a memorandum of points and authorities and supporting affidavits, if any, stating facts showing why the motion and/or joinder should be denied. Failure of the opposing party to serve and file written opposition may be construed as an admission that the motion and/or joinder is meritorious and a consent to granting the same.”
EDCR 2.20(e) Motions; contents; responses and replies; calendaring a fully briefed matter.

Consider the overwhelming, unjustified prejudice to Tobin, and unfair advantage to her opponents, if the 3/28/23 order stands

defamtory order declares me a vexatious litigant when there are no facts to justify it.
I am publicly humiliated and branded by an egragiously unfair and overly broad order that is faught with unsubstantiated, factually incorrect, insulting lies while I am blocked from getting my legitimate claims addressed.
I am prohibited from complaining about the attorneys who lied to the court, filed meritless claims by lying about their clients’ standing and misrepresenting the evidence, who entered false and falsified evidence into the record, who obstructed my case from being heard on the merits by unethical means including improper ex parte communications and concealing inculpatory evidence, who fraudulently transferrred the title before the trial, who falsified title reports
A judge’s personal opinion stands that my complaints against attorneys and the prior judge are “unprovable” and “improper” solely because she decided she didn’t need to conduct an evidentiary hearing to decide against me and order me not to stop complaining.
The motion for an order to show cause why attorneys should not be disciplined for filing false evidence, obstructing my case, that restricts me from filing any civil action vs. any defendant for any cause of action as a pro se is unappealable because Judge Peterson neither granted the motion nor denied in an appealable order. Therefore, the attorneys get a free pass from ever having to refute or deny my claims and I am prohibited from complaining about it.

Consider there is no prejudice to Judge Peterson if she voluntarily recuses herself or if Chief Judge excludes her from the decision to set aside the 3/28/23 order on jurisdictional or other grounds

None. She continues to be a judge. She just makes no more decisions on this case. Whether the reviewing judge decides to set aside the 3/28/23 order because Judge peterson acted outside her jurisdiction to grant relief to a non-party or acted improperly to exempt Tobin’s opponents from the EDCR 2.20 requirements at the unnoticed ex parte hearing or for whatever reason, Tobin will be made whole, at no cost to Judge Peterson. She never has to see the case again. It doesn’t go to the courts of appeal or the the commission on judicial and so her permanent record is unaffected.

Conclusion

There’s a hard way that everyone will fight

1. Declarations and exhibits provide evidence and legal authority to justify reassigning the case to another judge for a new trial so an evidentiary hearing can be finally held as Tobin has repeated requested and her opponents have repeatedly obstructed.

And there’s an easy way to end it without appeal

2.alternatively, the case can be resolved immediately on jurisdictional grounds, i.e., that Red Rock LLC’s lack of standing as an interested party to the dispute requires that its rogue filings be stricken from the record by granting Tobin’s 1/23/23 motions as unopposed and adopting the order submitted on 2/10/23 that Judge Peterson denied because she had improperly and unfairly exempted Tobin’s opponents from EDCR 2.20 at the 2/2/23 ex parte hearing.

Relief from fraud on the court can only be granted after a proper hearing

No NRS 40.110 hearing has ever been held

1. When the summons has been served as provided in NRS 40.100 and the time for answering has expired, the court shall proceed to hear the case as in other cases and shall have jurisdiction to examine into and determine the legality of plaintiff’s title and of the title and claim of all the defendants and of all unknown persons, and to that end must not enter any judgment by default, but must in all cases require evidence of plaintiff’s title and possession and receive such legal evidence as may be offered respecting the claims and title of any of the defendants and must thereafter direct judgment to be entered in accordance with the evidence and the law. The court, before proceeding to hear the case, must require proof to be made that the summons has been served and posted as hereinbefore directed and that the required notice of pendency of action has been filed.
NRS 40.110(1)

The litigation over the wrongful foreclosure of my late fiance’s former Sun City Anthem home has gone on for seven years, and there has never been an evidentiary hearing to resolve the title dispute. There was even a trial in the first action that was a complete joke because no one that was admitted to the trial had a deed to protect and all documentary evidence and witnesses were excluded. The court did not know that the attorneys had filed false evidence, suppressed other evidence, lied about the standing of the parties, and covered up that their clients had recorded false claims to title that, if convicted, carry penalties of class D felonies.

Pending motion to disqualify 3rd judge to refuse to consider the evidence

The current status of the case is a request to disqualify the third judge who has refused to conduct an evidentiary hearing and to get an independent, impartial judge to rule on the evidence that NRCP 12(b)(5) (claims preclusion per res judicata (already been heard)) does not apply because my claims have never been heard fully and fairly on their merits due to fraud on the court, i.e., my opponents obstructed my ability to put on my case.

Judge is helping attorneys cover up crime

In the instant case, I filed a motion for an order to show cause why written findings of attorney misconduct should not be forwarded to the State Bar in which I alleged specific lies the attorneys told the court on specific days, and I produced specified pieces of documentary evidence that supported my claims of false evidence that was entered into the court record or that I had filed but that had been unfairly stricken unconsidered. No attorney filed anything to substantively affirm or deny any of the allegations and none complied with EDCR 2.20(e) to file a written opposition “together with a memorandum of points and authorities and supporting affidavits, if any, stating facts showing why the motion … should be denied.”

Judge Peterson did not construe the attorneys’ failure to oppose the MOSC “as an admission that the motion is meritorious and a consent to granting the same”. She refused to grant the motion as unopposed per EDCR 2.20(e) and she refused to deny the motion in a written order so I could appeal it. (Bench orders are not appealable in Nevada).

Only written orders can be appealed

State, Div. Child Fam. Servs. v. Dist. Ct., 120 Nev. 445, 452 (Nev. 2004) (“[p]rior to the entry of a final judgment the district court remains free to reconsider and issue a written judgment different from its oral pronouncement.” Consequently, we stated that “[a]n oral pronouncement of judgment is not valid for any purpose; therefore, only a written judgment has any effect, and only a written judgment may be appealed.””)

Legal Research Memo

Below is a legal research memo showing that an evidentiary hearing must be conducted to address allegations of fraud. Judge Peterson spent 2 ½ years refusing to conduct an evidentiary hearing so she didn’t even know the interpleader action was filed in bad faith when the filer had instructed the attorney to interplead the proceeds six years earlier and I had the only valid claim after June 3, 2019. The case must be assigned to an impartial judge to conduct an evidentiary hearing in this case.

The Nevada cases I found generally state that a proper hearing is required in order to issue findings of fraud on the court. Specifically, the cases emphasize the need for clear and convincing evidence of fraud, and that the decision to grant relief is within the discretion of the trial court.

Several cases directly address the need for a “proper hearing” in order to establish fraud on the court. For example, in NC-DSH, Inc. v. Garner, the Nevada Supreme Court stated that “It is only after ‘a proper hearing,’ in which the fraud has been established by ‘clear and convincing evidence,’ that relief can be granted.” Similarly, in Hansen v. Aguilar, the Nevada Court of Appeals stated that “To grant NRCP 60(b) relief for fraud upon the court, the district court must first conduct a ‘proper hearing’ to determine if fraud has been established by clear and convincing evidence.”

Other cases, while not specifically mentioning the need for a “proper hearing,” do emphasize the importance of investigating allegations of fraud and the circumstances under which a judgment may be set aside for fraud. For example, in Confer v. District Court, the Nevada Supreme Court stated that “It is the duty of the court, on suggestion of fraud, to investigate and purge the record of the judgment, if fraudulent.” Similarly, in Parks v. Quintana, the Nevada Supreme Court stressed the importance of both sides having their “day in court” and being able to litigate the issue of fraud.

Overall, the cases I found suggest that a proper hearing is required in order to issue findings of fraud on the court, and that the court must be presented with clear and convincing evidence of fraud in order to grant relief. However, the cases also make clear that the decision to grant relief is ultimately within the discretion of the trial court.

Cases (21)

NC-DSH, Inc. v. Garner, 218 P.3d 853 (Nev. 2009)

This case directly addresses the need for a “proper hearing” in order to establish fraud on the court, and it is from the Nevada Supreme Court, making it highly authoritative.

“However, the policy of repose yields when “the court finds after a proper hearing that fraud has been practiced upon it, or the very temple of justice has been defiled.” Universal Oil Co. v. Root Rfg. Co., 328 U.S. 575, 580 (1946).”

“It is only after “a proper hearing,”Universal Oil Co., 328 U.S. at 580, in which the fraud has been established by “clear and convincing evidence,”Occhiuto, 97 Nev. at 146 n. 2, 625 P.2d at 570 n. 2, that relief can be granted. Even then, the motion “is addressed to the sound discretion of the trial court.” Id. The district judge in this case conducted an evidentiary hearing and entered specific and adequate findings of fact and conclusions of law.”

Hansen v. Aguilar, No. 64239 (Nev. App. May. 25, 2016)

The case states that “To grant NRCP 60(b) relief for fraud upon the court, the district court must first conduct a ‘proper hearing’ to determine if fraud has been established by clear and convincing evidence.”

“To grant NRCP 60(b) relief for fraud upon the court, the district court must first conduct a “proper hearing” to determine if fraud has been established by clear and convincing evidence. Id. (quoting Occhiuto v. Occhiuto, 97 Nev. 143, 146 n. 2, 625 P.2d 568, 570 n. 2 (1981) (internal quotations omitted)).”

🟥 Vaile v. Dist. Ct., 118 Nev. 262 (Nev. 2002)

The case discusses the importance of a hearing in order to uncover the truth and prevent fraud on the court.

“The district court was required to hear the live testimony of both Scotlund and his resident witness before entering its decree of divorce. We raise this point because it appears the district court was misled by the language of the complaint and the affidavit.”

“See NRS 125.123 (providing that the district court is not required to accept a case for default divorce upon submission; court has the discretion to order a hearing and require the presence of the plaintiff and the resident witness).”

Price v. Dunn, 106 Nev. 100 (Nev. 1990)

Price v. Dunn discusses the concept of extrinsic fraud on the court, and states that a proper hearing is required to determine whether such fraud occurred.

“The first guideline, that the moving party must show some excuse for setting aside the judgment, is addressed by NRCP 60(b) which provides that a court may relieve a party from a final judgment for extrinsic fraud upon a court with no time limitation. “Extrinsic fraud has been held to exist when the unsuccessful party is kept away from the court by . . . such conduct as prevents a real trial upon the issues involved, or any other act or omission which procures the absence of the unsuccessful party at the trial.” Colby v. Colby, 78 Nev. 150, 153-154, 369 P.2d 1019, 1021 (1962) (quoting Murphy v. Murphy, 65 Nev. 264, 271, 193 P.2d 850, 854 (1948)); see also Murphy v. Murphy, 103 Nev. 185, 186, 734 P.2d 738, 739 (1987).”

“John offers the affidavit of Margaret Price to support his allegation.”

“If Margaret’s affidavit is true, then Melody did commit fraud upon the court because she intentionally kept John away from the hearing.”

Helina-Bergeron v. Bergeron, No. 78354-COA (Nev. App. Sep. 18, 2019)

This case discusses the requirement for an evidentiary hearing in order to modify a custody order, which is analogous to the research request’s inquiry about a hearing to issue findings of fraud on the court.

“A district court may decline to grant an evidentiary hearing if the moving party fails to show “adequate cause” to hold a hearing and must hold a hearing if the party established adequate cause for the hearing. Rooney v. Rooney, 109 Nev. 540, 542-43, 853 P.2d 123, 124-25 (1993). A movant establishes “adequate cause” when the movant presents a prima facie case for modification. Id. at 543, 853 P.2d at 125. “To constitute a prima facie case it must be shown that: (1) the facts alleged in the affidavits are relevant to the grounds for modification; and (2) the evidence is not merely cumulative or impeaching.””

Abid v. Abid, No. 82781-COA (Nev. App. Apr. 8, 2022)

The case discusses the requirement for an evidentiary hearing in order to modify child custody, and cites Rooney v. Rooney, which sets forth the standard for “adequate cause” to hold such a hearing.

“And a district court must hold an evidentiary hearing on a request to modify custody if the moving party demonstrates “adequate cause.” Rooney u. Rooney, 109 Nev. 540, 542, 853 P.2d 123, 124 (1993). “Adequate cause arises where the moving party presents a prima facie case for modification.” Id. at 543, 853 P.2d at 125 (internal quotation marks omitted). And to make a prima facie case, the moving party must show that “(1) the facts alleged in the affidavits are relevant to the grounds for modification; and (2) the evidence is not merely cumulative or impeaching.””

Milam v. Stealth Holdings, LLC, 381 P.3d 641 (Nev. 2012)

The case discusses the need for a “proper hearing” to establish fraud, although it does not specifically mention “fraud on the court.”

“This court has not mandated that a district court hold an evidentiary hearing to determine whether to set aside a judgment concerning allegations of fraud. Cf. NC–DSH, Inc. v. Garner, 125 Nev. 647, 657, 218 P.3d 853, 860–61 (2009)(providing that “[i]t is only after a proper hearing in which the fraud [upon the court] has been established by clear and convincing evidence that relief can be granted.” (citations omitted) (internal quotations omitted)); Occhiuto v. Occhiuto, 97 Nev. 143, 146 n. 2, 625 P.2d 568, 570 n. 2 (1981)(recognizing a fundamental difference between “fraud” and “fraud upon the court”).”

Murphy v. Murphy, 734 P.2d 738 (Nev. 1987)

Murphy v. Murphy discusses the concept of fraud on the court and the court’s inherent jurisdiction to remedy it, but does not specifically mention the need for a proper hearing.

“The six-month limitation on allegations of fraud is inapplicable to fraud upon the court. Savage v. Salzmann, 88 Nev. 193, 195, 495 P.2d 367, 368 (1972).”

“Further, the court can proceed even in the absence of further action by a party, Kupferman v. Consolidated Research Mfg. Corp., 459 F.2d 1072, 1074 n. 1 (2d Cir. 1972).”

“Fraud upon the court consists of, inter alia, “such conduct as prevents a real trial upon the issues involved,” Savage, supra, 88 Nev. at 195, 495 P.2d at 368.”

“Accord Goodyear Tire Rubber Co. v. H.K. Porter Co., 521 F.2d 699 (6th Cir. 1975); Kupferman, supra; Taft v. Donellan Jerome, Inc., 407 F.2d 807 (7th Cir. 1969).”

Parks v. Quintana, 477 P.2d 869 (Nev. 1970)

Although the case does not explicitly state that a proper hearing is required to issue findings of fraud on the court, it does emphasize the importance of both sides having their “day in court” and being able to litigate the issue of fraud.

“On this appeal the grantee-appellant contends that she did not have her day in court since the legal sufficiency of the description was not an issue raised by the pleadings, nor did it become an issue during trial and cannot, therefore, be deemed to have been tried with the implied consent of the parties.”

“This contention is sound. The case was tried by both sides upon the issue of fraud. After the evidence was closed the court stated its concern about the adequacy of the description, and called for briefs.”

“Of course, the court need not receive evidence on this point if it finds that the deed must be voided upon the ground of fraud.”

Confer v. District Court, 49 Nev. 18 (Nev. 1925)

While the case does not specifically mention the need for a “proper hearing” to issue findings of fraud on the court, it does discuss the importance of investigating allegations of fraud and the circumstances under which a judgment may be set aside for fraud.

“It is duty of court, on suggestion of fraud, to investigate and purge record of judgment, if fraudulent.”

“To vitiate decree, fraud must be actual, and extrinsic or collateral as distinguished from judgment obtained on false evidence. Reeves v. Reeves, supra; Lieber v. Lieber, 143 S.W. 458; Orr v. Orr, 146 P. 964; U.S. v. Throckmorton, 98 U.S. 61; Friese v. Hemmel, 37 P. 458; Greene v. Greene, 2 Gray, 361; Graves v. Graves, 10 L.R.A. (N.S.) 216. To entitle party to relief in equity perjury or fraud must consist of extrinsic facts not examined in former action. Moor v. Moor, 63 S.W. 347.”

Estate of Adams ex rel. Estate v. Fallini, 132 Nev. Adv. Op. 81 (Nev. 2016)

“BEFORE PARRAGUIRRE, C.J., HARDESTY and PICKERING, JJ. OPINION By the Court, PARRAGUIRRE, C.J.: In this case, we consider whether a party may appeal a district court’s order granting an NRCP 60(b) motion to set aside a final judgment for fraud upon the court. We hold that such an order is interlocutory in nature and, thus, may not be appealed until there has been a final judgment.”

“The Estate argues that the district court erred in granting NRCP 60(b) relief because the conduct involved did not rise to the level of fraud upon the court. We disagree. This court reviews a district court’s decision to set aside a judgment based on fraud upon the court for an abuse of discretion.”

“Id. at 653, 218 P.3d at 858 (internal quotation marks omitted).”

In re Amerco Derivative Lit., 127 Nev. Adv. Op. No. 17, 51629 (2011), 252 P.3d 681 (Nev. 2011)

“In Shoen, we noted that “[i]f the district court should find the pleadings provide sufficient particularized facts to show demand futility, it must later conduct an evidentiary hearing to determine, as a matter of law, whether the demand requirement nevertheless deprives the shareholder of his or her standing to sue.”Id. at 645, 137 P.3d at 1187. Thus, on remand, this matter should be scheduled for an evidentiary hearing to determine whether demand was, in fact, futile.”

Secretary of State v. Tretiak, 117 Nev. 299 (Nev. 2001)

“NRS 90.630(2)(c) states as follows: If the administrator reasonably believes, whether or not based upon an investigation conducted under NRS 90.620, that a person has violated this chapter or a regulation or order of the administrator under this chapter, the administrator, in addition to any specific power granted under this chapter, after giving notice by registered or certified mail and conducting a hearing in an administrative proceeding, unless the right to notice and hearing is waived by the person against whom the sanction is imposed, may . . . [b]ar or suspend him from association with a licensed broker-dealer or investment adviser in this state. As to RFCA Financial, the hearing officer recommended that RFCA Financial be sanctioned because “[its] failures were so prevalent, and so egregious, I question whether the firm ever could demonstrate the ability or the intent to comply with the law.””

“NRS 90.420(1)(b) states as follows: The administrator by order may . . . revoke any license . . . if the administrator finds that the order is in the public interest and that the . . . broker-dealer . . . [h]as violated or failed to comply with a provision of this chapter as now or formerly in effect or a regulation or order adopted or issued under this chapter. . . . Because the Division’s sanctions were not an abuse of discretion, the district court erred in modifying the sanctions imposed against Tretiak and RFCA Financial. Accordingly, we reverse that portion of the district court’s order modifying the sanctions imposed against Tretiak and RFCA Financial.”

Smith v. Smith, No. 66549 (Nev. App. Jan. 20, 2016)

“Specifically, appellant asserts that he was prevented from attending the hearing underlying the divorce decree when he was transferred to a different prison within the Nevada Department of Corrections. This does not, however, set forth a basis for a finding of fraud upon the court.”

“To the extent appellant argues that respondent misrepresented to the court that appellant would be receiving social security income, this would, at most, amount to fraud or misrepresentation of an adverse party, which must be raised in an NRCP 60(b) motion within six months after notice of entry of the judgment was served. See NRCP 60(b)(3); see also NC-DSH, Inc. v. Garner, 125 Nev. 647, 654, 218 P.3d 853, 858 (2009) (noting that fraud upon the court “cannot mean any conduct of a party or lawyer of which the court disapproves,” and defining fraud upon the court as “that species of fraud which does, or attempts to, subvert the integrity of the court itself, or is a fraud perpetrated by officers of the court so that the judicial machinery cannot perform in the usual manner its impartial task of adjudging cases” (quoting Demjanjuk v. Petrovsky, 10 F.3d 338, 352 (6th Cir. 1994))).”

“Alternatively, to the extent appellant argues that the pension distribution and spousal support provisions were void for lack of due process, due process requires notice and an opportunity to be heard.”

Grisham v. Grisham, 128 Nev. Adv. Op. 60 (Nev. 2012)

“Its language is somewhat oblique: No agreement or stipulation between the parties in a cause or their attorneys, in respect to proceedings therein, will be regarded unless the same shall, by consent, be entered in the minutes in the form of an order, or unless the same shall be in writing subscribed by the party against whom the same shall be alleged, or by his attorney. See also EDCR 7.50 (replicating DCR 16 with minor revisions). Despite its awkward wording, DCR 16’s application is straightforward: An agreement to settle pending litigation can be enforced by motion in the case being settled if the agreement is “either … reduced to a signed writing or … entered in the court minutes following a stipulation.” Resnick v. Valente, 97 Nev. 615, 616, 637 P.2d 1205, 1206 (1981) (applying DCR 24, later renumbered DCR 16). [2] [3] [4] DCR 16 applies to divorce and dissolution disputes equally with any other kind of civil litigation.”

“See In re Marriage of Assemi, 7 Cal.4th 896, 30 Cal.Rptr.2d 265, 872 P.2d 1190, 1195 (1994) (applying Cal.Civ.Proc.Code § 664.6); In re Dolgin Eldert Corporation, 31 N.Y.2d 1, 334 N.Y.S.2d 833, 286 N.E.2d 228, 232 (1972) (applying N.Y. C.P.L.R. 2104); Matter of Estate of Eberle, 505 N.W.2d 767, 770 (S.D.1993) (“Oral stipulations of the parties in the presence of the court are generally held to be binding, especially when acted upon or entered on the court record….”).”

🟥 State, Dep’t Human Resources v. Shively, 110 Nev. 316 (Nev. 1994)

“Moreover, NSWD could not discontinue benefits or recoup any monies paid before the recipient had a formal hearing in an administrative forum. NRS 422.294 et seq. In fact, NSWD continued to pay benefits until the hearing officer rendered a decision affirming the right to terminate. In light of these facts, we conclude that NSWD cannot now be penalized for pursuing an administrative resolution to its dispute with Shively.”

Valley Health Sys. v. The Eighth Judicial Dist. Court of State, No. 84330 (Nev. Jun. 1, 2022)

“We address each in turn. Crime-fraud exception MRS 49.115(1) sets forth the crime-fraud exception to attorney-client privilege: “There is no privilege under NRS 49.095 or NRS 41.105 . . . [i]f the services of the lawyer were sought or obtained to enable or aid anyone to commit or plan to commit what the client knew or reasonably should have known to be a crime or fraud.” For the statutory exception to apply, the party asserting the crime-fraud exception “has the burden of making a prima facie showing that the communications were in furtherance of an intended or present illegality . . . and that there is some relationship between the communications and the illegality.” In re Grand Jury Proceedings, 87 F.3d 377, 380 (9th Cir. 1996) (alteration in original) (quoting United States v. Laurins, 857 F.2d 529, 540 (9th Cir. 1988)). The moving party cannot “merely . . . allege that it has a sneaking suspicion the client was engaging in or intending to engage in a crime or fraud when it consulted the attorney.” Id. at 381. The district court must instead “find reasonable cause to believe that the attorney’s services were utilized in furtherance of the ongoing unlawful scheme.””

Stanton v. Stanton, No. 80910 (Nev. Mar. 3, 2022)

“Regardless of the parties’ waivers, the district court did not abuse its discretion in granting the motion as the court held a hearing on the motion and the evidence in the record supports a finding of clear and convincing evidence of a fraud upon the court. NRCP 60(d)(3) (permitting a district court to “set aside a judgment for fraud upon the court”); NC-DSH, Inc. v. Garner, 125 Nev. 647, 658, 218 P.3d 853, 861 (2009) (explaining that such motions are “addressed to the sound discretion of the trial court”). This court notes as well that neither appellant nor respondent sought an evidentiary hearing nor made any request to call witnesses or present evidence outside of what was provided to the court in the pleadings.”

Rivas v. Arreguin, 502 P.3d 187 (Nev. App. 2022)

“Further, we recognize that the limited analysis in the district court’s order may reflect that its decision to deny Rivas s motion was based on a determination that he failed to establish adequate cause for an evidentiary hearing and that it was therefore unnecessary to entertain his motion at an evidentiary hearing. See Rooney v. Rooney, 109 Nev. 540, 542-43, 853 P.2d 123, 124-25 (1993) (explaining that the district court has discretion to deny a motion to modify custody without conducting an evidentiary hearing if the moving party fails to establish adequate cause for such a hearing).”

“Otherwise, an evidentiary hearing is required. It is so ORDERED.”

Peck v. State, No. 75026 (Nev. App. Oct. 15, 2018)

“Peck correctly argues on appeal that the six month time limit contained in NRCP 60(b) does not bar a motion to set aside judgment based upon fraud upon the court. See NC-DSH, Inc. v. Garner, 125 Nev. 647, 659, 218 P.3d 853, 861-62 (2009) (stating that “[o]ur Nevada cases have held that a party who seeks relief from a judgment based on fraud upon the court is not subject to NRCP 60(b)’s six-month limitation period”).”

“See NC-DSH, 125 Nev. at 657, 218 P.3d at 860-61 (providing that in order to have a final judgment vacated for fraud upon the court, fraud must be established by clear and convincing evidence).”

Nelson v. The Eighth Judicial Dist. Court of the State, 138 Nev. Adv. Op. 82 (Nev. 2022)

“The district court did not abuse its discretion in ruling on the motion without holding an evidentiary hearing Nelson argues that Ryan’s Express requires an evidentiary hearing and findings of fact and conclusions of law on a disqualification motion. She asserts that the requirement applies to disqualification motions concerning both lawyers and nonlawyers.”

“So, too, is the decision to hold an evidentiary hearing. See id. Generally, evidentiary hearings should be utilized where “factual questions are not readily ascertainable,” or if “witnesses or questions of credibility predominate.””

“Thus, where fact and credibility determinations are necessary to the resolution of either question, the trial court should hold an evidentiary hearing.”

Statutes (8)

Section 357.120 – Effect of intervention of Attorney General or designee in action by private plaintiff; motion to dismiss; settlement, Nev. Rev. Stat. § 357.120

“The Attorney General or the Attorney General’s designee may move to dismiss the action for good cause.”

“Upon the request of the private plaintiff, the court shall determine, after a hearing, whether the proposed settlement is fair, adequate and reasonable under all the circumstances.”

Section 645.844 – Recovery from Fund: Procedure; grounds; amount; hearing, Nev. Rev. Stat. § 645.844

“Upon the hearing on the petition, the petitioner must show that: (a) The petitioner is not the spouse of the debtor, or the personal representative of that spouse. (b) The petitioner has complied with all the requirements of NRS 645.841 to 645.8494, inclusive. (c) The petitioner has obtained a judgment of the kind described in subsection 1, stating the amount thereof, the amount owing thereon at the date of the petition, and that the action in which the judgment was obtained was based on fraud, misrepresentation or deceit of the licensee in a transaction for which a license is required pursuant to this chapter. (d) A writ of execution has been issued upon the judgment and that no assets of the judgment debtor liable to be levied upon in satisfaction of the judgment could be found, or that the amount realized on the sale of assets was insufficient to satisfy the judgment, stating the amount so realized and the balance remaining due. (e)”

Section 116B.915 – Remedial and disciplinary action: Audit of association; appointment of receiver, Nev. Rev. Stat. § 116B.915

“1. If the Commission or a hearing panel, after notice and hearing, finds that the executive board or any person acting on behalf of the association has committed a violation, the Commission or the hearing panel may order an audit of the association. 2. The Commission, or the Division with the approval of the Commission, may apply to a court of competent jurisdiction for the appointment of a receiver for an association if, after notice and a hearing, the Commission or a hearing officer finds that any of the following violations occurred: (a) The executive board, or any member thereof, has been guilty of fraud or collusion or gross mismanagement in the conduct or control of its affairs; (b)”

“The hearing thereon may be had after 5 days’ notice unless the court directs a longer or different notice and different parties. 4.”

Section 116.790 – Remedial and disciplinary action: Audit of association; requiring association to hire community manager who holds certificate; appointment of receiver, Nev. Rev. Stat. § 116.790

“1. If the Commission or a hearing panel, after notice and hearing, finds that the executive board or any person acting on behalf of the association has committed a violation, the Commission or the hearing panel may take any or all of the following actions: (a) Order an audit of the association, at the expense of the association. (b) Require the executive board to hire a community manager who holds a certificate. 2. The Commission, or the Division with the approval of the Commission, may apply to a court of competent jurisdiction for the appointment of a receiver for an association if, after notice and a hearing, the Commission or a hearing officer finds that any of the following violations occurred: (a) The executive board, or any member thereof, has been guilty of fraud or collusion or gross mismanagement in the conduct or control of its affairs; (b)”

Section 159A.078 – Petition by guardian or other interested person for order authorizing or directing guardian to take certain actions, Nev. Rev. Stat. § 159A.078

“The court may authorize the guardian to take any action described in subsection 1 if, after notice to any person who is adversely affected by the proposed action and an opportunity for a hearing, the court finds by clear and convincing evidence that: (a) A reasonably prudent person or the protected minor would take the proposed action and that a person has committed or is about to commit any act, practice or course of conduct which operates or would operate as a fraud or act of exploitation upon the protected minor or estate of the protected minor and that person: (1) Is designated as a beneficiary in or otherwise stands to gain from an instrument which was executed by or on behalf of the protected minor; or (2) Will benefit from the lack of such an instrument; or (b) The proposed action is otherwise in the best interests of the protected minor for any other reason not listed in this section. 4.”

Section 159.078 – Petition by guardian or other interested person for order authorizing or directing guardian to take certain actions, Nev. Rev. Stat. § 159.078

“The court may authorize the guardian to take any action described in subsection 1 if, after notice to any person who is adversely affected by the proposed action and an opportunity for a hearing, the court finds by clear and convincing evidence that: (a) A reasonably prudent person or the protected person, if not incapacitated, would take the proposed action and that a person has committed or is about to commit any act, practice or course of conduct which operates or would operate as a fraud or act of exploitation upon the protected person or estate of the protected person and that person: (1) Is designated as a beneficiary in or otherwise stands to gain from an instrument which was executed by or on behalf of the protected person; or (2) Will benefit from the lack of such an instrument; or (b) The proposed action is otherwise in the best interests of the protected person for any other reason not listed in this section. 4.”

Section 645B.750 – Duty of Commissioner to provide written notice of disciplinary action or denial of license; right to administrative hearing; entry of final order; appeals, Nev. Rev. Stat. § 645B.750

“Unless a hearing has already been conducted concerning the matter, the person, upon application, is entitled to a hearing. If the person does not make such an application within 20 days after the date of the initial order, the Commissioner shall enter a final order concerning the matter. 3.”

Section 533.450 – Orders and decisions of State Engineer subject to judicial review; procedure; motions for stay; appeals; appearance by Attorney General, Nev. Rev. Stat. § 533.450

“The proceedings in every case must be heard by the court, and must be informal and summary, but full opportunity to be heard must be had before judgment is pronounced.3.”

Regulations (3)

Section 679B.090 – Contents of petition; decision of court, Nev. Admin. Code § 679B.090

“1. A petition for payment must contain copies of the documents of the court which show, to the satisfaction of the Commissioner, the grounds for the final judgment.”

“Except as otherwise provided in this subsection, the decision of the court must include a specific finding by the court that the licensee perpetrated fraud, intentional misrepresentation, embezzlement or deceit on the petitioner in connection with a transaction for which the licensee was licensed. If the decision of the court does not include a specific finding, sufficient evidence that the licensee committed any of the acts set forth in this subsection must be presented to the Commissioner. The Commissioner will accept copies of verdicts and findings from federal and state courts including findings made pursuant to Title 11 of the United States Code relating to the discharge of the bankrupt, if he or she determines that there is a final judgment which includes a specific finding of fraud, intentional misrepresentation, embezzlement or deceit on the part of the licensee. 3.”

Section 645F.855 – Notice of and hearing on certain orders of Commissioner; entry of final order; appeal of final order taking disciplinary action, Nev. Admin. Code § 645F.855

“Unless a hearing has already been conducted concerning the matter, the person, upon application, is entitled to a hearing. If the person does not make such an application within 20 days after the date of the initial order, the Commissioner will enter a final order concerning the matter. 3.”

Section 645A.365 – Notice of and hearing on certain orders of Commissioner; entry of final order; appeal of final order taking disciplinary action, Nev. Admin. Code § 645A.365

“Unless a hearing has already been conducted concerning the matter, the person, upon application, is entitled to a hearing. If the person does not make such an application within 20 days after the date of the initial order, the Commissioner will enter a final order concerning the matter. 3.”

Analysis (1)

A Due Process Travesty in a Workers Compensation Case

“Judge Vernoia found it violative of due process for the judge to dismiss a case “where credibility of the witnesses is an issue and the underlying facts are disputed” without hearing the claimant’s testimony. That violated “fundamental fairness” and “the fundamental tenet of our Anglo-American system of justice.””

“It was also error to make credibility findings based only on the claimant’s affidavit and the testimony of respondent’s witnesses who “did not witness the incident and could not describe the manner in which petitioner jumped.” On top of all that, the judge wrongly “found petitioner was a liar and conditioned restoration of petitioner’s claim petition on proof petitioner is ‘honest.’” Neither respondent nor the panel found any authority for such an action, Judge Vernoia said. “There is no requirement a petitioner first establish he or she is honest before obtaining a hearing on a claim petition.””

The A-21-828840-C interpleader action was filed in bad faith

The facts of this case, considered within the context of the Nevada case law articulated below in the www.casetext.com AI-assisted legal research memo, show the A-21-828840-C case, was filed for an improper purpose.

The research memo lists three main ways of assessing if an interpleader action was filed in bad faith:

delay in filing the action
the stakeholder is not disinterested
the filer knew, or should have known, the defendants don’t have valid competing claims

the Plaintiff Red Rock partnership subsidiary of firstService Residential, Nevada LLC did not have standing as it had instructed its attorney, Steven Scow to file the action on 8/28/14 and had given him a check to Clark County district Court to deposit $57,282.32 designated as “excess funds 2763 White Sage” for interpleader
the filer attorney Steven Scow was not disinterested as he concealed from the court that he had disobeyed his client Red Rock’s instructions to deposit $57,282.32 with the court on 8/28/14 and Scow concealed that Red Rock had taken all fees it was legally permitted pursuant to NRS 116.31164(3)(c )(1)(2)(2013) prior to the 8/21/14 date the check was made out to the court designated as “excess”
the filer attorney Steven Scow, who may be one of the unidentified Red Rock partners, converted the funds to an account under his personal proprietary control rather than distribute them to the rightful owner six years earlier as required by law and as he had been instructed by his client
the filer attorney Steven Scow knew there was only one defendant that had a valid recorded claim to the interpleaded proceeds after June 3, 2019, and the research memo lists filing an action when you know that there are no competing claims is an indicator of bad faith

Casetext.com Legal Research Memo

Question Presented

What would constitute direct evidence that an interpleader action was filed in bad faith?

Answer

There are a number of potential indicators of bad faith in filing an interpleader action, including: delay in filing the action, filing an action that does not meet the requirements for interpleader, acting in bad faith to create the controversy necessitating the interpleader, or lacking a good faith belief that there are competing claims to the stake.

Analysis

One potential indicator of bad faith in filing an interpleader action is delay in filing the action. As the court in Pruco Life Ins. Co. v. Killingsworth noted, a stakeholder’s delay in filing an interpleader action may show bad faith, even if the action is ultimately filed correctly. Additionally, as the court in Principal Life Ins. Co. v. Calloway discussed, an interpleader action must meet certain requirements in order to be proper, and a filing that does not meet these requirements could be evidence of bad faith.

Another potential indicator of bad faith is if the stakeholder acted in bad faith to create the controversy necessitating the interpleader. As the court in Raymond James & Assocs. v. Bassford noted, the stakeholder must have a “good faith belief” that there are competing claims to the stake in order to file an interpleader action, and the absence of such a belief could be evidence of bad faith. Additionally, as the court in Michelman v. Lincoln Nat’l Life Ins. Co. held, the stakeholder must have a good faith belief that there are or may be colorable competing claims to the stake in order to avail itself of the interpleader remedy.

Finally, as the court in Sun Life Assur. Co. v. Sampson discussed, a court may deny an award of fees and costs to a stakeholder in an interpleader action if the stakeholder has acted in bad faith. This could include contributing to the need for interpleader by acting in bad faith or by unduly delaying in seeking relief.

Cases (40)

Pruco Life Ins. Co. v. Killingsworth, CIVIL ACTION NO. 5:19-cv-55-DCB-MTP (S.D. Miss. Nov. 26, 2019)

The case discusses the possibility that a delay in filing an interpleader action may show bad faith, even if the action is ultimately filed correctly.

“A stakeholder’s delay in filing an interpleader action may show bad faith, even where the interpleader action is rightly filed. See Steinberg’s Dept. Store, Inc. v. Hartford Fire Ins. Co., 407 N.E.2d 124 (Ill. Ct. App. 1980).”

“However, an inadequate investigation of a claim or inaction may constitute bad faith. See James v. State Farm Mut. Auto. Ins. Co., 743 F.3d 65 (5th Cir. 2014)(finding evidence that an insurer was inactive or did nothing meaningful to investigate the claim for several months, including the period after the suit was filed, could support a jury finding of bad faith). When a company decides to pursue its equitable remedy in interpleader, it should act with a “reasonable degree of promptness and with reasonable diligence.” John Hancock Mut. Life Ins. Co. v. Doran, 138 F.Supp. 47, 49 (S.D. NY 1958).”

Principal Life Ins. Co. v. Calloway, Case No. 1:19-cv-00147-DAD-SKO (E.D. Cal. Feb. 23, 2021)

The case discusses the requirements for a proper interpleader action, which could be used to argue that a filing that does not meet these requirements was made in bad faith.

“Thus, interpleader is proper. 2. Propriety of Discharge and Dismissal If the court determines that an interpleader is proper, it may discharge the stakeholder from further liability.”

“”A court should readily discharge a disinterested stakeholder from further liability absent a stakeholder’s bad faith in commencing an interpleader action, potential independent liability to a claimant, or failure to satisfy requirements of rule or statutory interpleader.” OM Financial Life Ins. Co. v. Helton, No. 2:09-cv-01989 WBS EFB, 2010 WL 3825655, at *3 (E.D. Cal. Sept. 28, 2010).”

Great Am. Life Ins. Co. v. Hollick, Case No.: 17-cv-1288-AJB-WVG (S.D. Cal. Feb. 5, 2018)

The case discusses the possibility of bad faith in commencing an interpleader action, and provides a standard for determining whether the stakeholder is acting in bad faith.

“OM Financial Life Ins. Co. v. Helton, No. CIV. 2:09-1989 WBS EFB, 2010 WL 3825655, at *3 (E.D. Cal. Sept. 28, 2010) (citations omitted).”

“Auth., 700 F.2d 91, 96 (2d Cir. 1983) (holding that a disinterested stakeholder may be discharged unless the action was brought in bad faith).”

Great Am. Life Ins. Co. v. Brown-Kingston, Case No. 2:18-cv-02783-MCE-KJN (E.D. Cal. May. 13, 2019)

The case discusses the possibility of bad faith in commencing an interpleader action, and provides a citation to an authority that addresses the issue in more detail.

“OM Financial Life Ins. Co. v. Helton, No. 2:09-cv-01989 WBS EFB, 2010 WL 3825655, at *3 (E.D. Cal. Sept. 28, 2010) (citations omitted). GALIC argues it is a disinterested stakeholder who brought this action in good faith, thus should be discharged from liability. See New York Life Ins. Co. v. Connecticut Dev.”

State Auto Prop. & Cas. Ins. Co. v. Burnett, NO. 3:16-CV-73-DMB-JMV (N.D. Miss. Sep. 29, 2017)

The authority discusses the possibility of a court denying or delaying the discharge of a stakeholder in an interpleader action if there are “serious charges that the stakeholder commenced the action in bad faith.”

“A court may nevertheless delay or deny discharge of the stakeholder if there are “serious charges that the stakeholder commenced the action in bad faith.” Underwriters Grp., Inc., 2006 WL 1852254, at *5 (citing Mendez v. Teachers Ins. & Annuity Assoc., 982 F.2d 783, 788 (2nd Cir. 1992)).”

Sun Life Assur. Co. v. Sampson, 556 F.3d 6 (1st Cir. 2009)

The authority discusses the circumstances under which a court may deny an award of fees and costs to a stakeholder in an interpleader action, including when the stakeholder has acted in bad faith.

“The test is not satisfied if the stakeholder has contributed to the need for interpleader by acting in bad faith or by unduly delaying in seeking relief. Id. at 682 (footnotes omitted); see also Septembertide Publ’g, B.V. v. Stein Day, Inc., 884 F.2d 675, 683 (2d Cir. 1989); Ferber Co. v. Ondrick, 310 F.2d 462, 467 (1st Cir. 1962) (recognizing that fees in an inter-pleader action are “usually awarded . . . to compensate a totally disinterested stake-holder who [has] been . . . subjected to conflicting claims through no fault of his own”).”

“Sampson attempts to fit this case into two categories where the inter-pleading party is not usually allowed fees: (1) where the party acts in bad faith; and/or (2) where the interpleader is not disinterested, but benefits (beyond resolution of the issue) from the litigation. See Ferber, 310 F.2d at 467 (upholding the denial of fees where the “great bulk” of a party’s efforts were devoted to addressing a counterclaim as to which it was “in no way disinterested”); First Interstate Bank of Or, N.A v. United States, 891 F.Supp. 543, 548 (D.Or. 1995) (citing Schirmer Stevedoring Co. v. Seaboard Stevedoring Corp., 306 F.2d 188, 194-95 (9th Cir. 1962)) (noting that courts “routinely” award fees to a disinterested stakeholder “absent a showing of bad faith”); see also generally 7 Wright, Miller Kane, supra, § 1719, at 684-86.”

First Interstate Bancsystem, Inc. v. Afraid, CV 19-10-BLG-SPW (D. Mont. Feb. 14, 2019)

The case discusses the requirement that a stakeholder must have a “good faith belief” that there are competing claims to the stake in order to file an interpleader action, which implies that the absence of such a belief could be evidence of bad faith.

“Moreover, “in order to avail itself of the interpleader remedy, a stakeholder must have a good faith belief that there are or may be colorable competing claims to the stake.” Michelman v. Lincoln Nat.”

Steinberg’s Dept. Store v. Hartford Fire Ins. Co., 407 N.E.2d 124 (Ill. App. Ct. 1980)

The case discusses the question of whether an interpleader action was filed in good faith, and identifies factors that could suggest bad faith, such as the withdrawal of a claim and the potential for the interpleader to force a settlement.

“It is further argued that once the claim was withdrawn, Hartford was no longer justified in withholding payment of the $30,000, and the interpleader action was not, therefore, filed in good faith.”

“As indications of bad faith, Steinberg’s cites the June 22 letter from the Bank withdrawing its claim to the insurance proceeds and also contends that, under the law of Illinois, the named insured is the only party entitled to the proceeds of a fire insurance policy in the absence of a policy provision to the contrary. ( La Salle Extension University, Inc. v. B.F. Shaw Printing Co. (1965), 62 Ill.”

“Also persuasive is the fact that Hartford delayed payment for 13 months, allegedly to force Steinberg’s to settle with the Bank from its own funds without compensation from Hartford. Thus, even though the trial court ruled that interpleader was rightfully filed, Hartford’s delay could nevertheless have been in bad faith.”

Michelman v. Lincoln Nat’l Life Ins. Co., 685 F.3d 887 (9th Cir. 2012)

This case discusses the good faith requirement for filing an interpleader action, and provides guidance on what might constitute bad faith.

“See, e.g., Aaron v. Mahl, 550 F.3d 659, 663 (7th Cir.2008); CNA Ins. Cos. v. Waters, 926 F.2d 247, 251 (3d Cir.1991).”

“Therefore, we agree with the principle articulated in Lee and now expressly hold that in order to avail itself of the interpleader remedy, a stakeholder must have a good faith belief that there are or may be colorable competing claims to the stake.”

“Mack v. Kuckenmeister, 619 F.3d 1010, 1024 (9th Cir.2010) (quoting Ensley, 174 F.3d at 980).”

Maraist Law Firm, P.A. v. Coates, 21-CV-81467-AMC/BER (S.D. Fla. Jul. 6, 2022)

This case discusses the requirements for filing an interpleader action and the circumstances under which a court may impose sanctions for filing a frivolous claim. It specifically addresses the need for an identifiable res and the existence of multiple claimants, both of which are relevant to determining whether an interpleader action was filed in bad faith.

“I agree that Count VII was objectively frivolous. First, there was no adequate identifiable financial res to support an interpleader action against any of the Movants. See ECF No. 110 ¶ 57.”

“Persisting in this claim was frivolous and violated Rule 11 as to all Movants.”

“Maraist argues that it conducted proper diligence before filing the interpleader cause of action. ECF No. 113 at 5-6.”

“A reasonably diligent researcher would have uncovered these principles and realized that they precluded interpleading the funds and thumb drive in this case.”

Mendez v. Teachers Ins. and Annuity Ass’n, 982 F.2d 783 (2d Cir. 1992)

“New York Life Ins. Co., supra, 700 F.2d at 96.”

“In view of Mendez’ plain entitlement to the proceeds, TIAA-CREF’s delay in commencing an interpleader action clearly was unreasonable and impliedly was commenced in bad faith. TIAA-CREF has given us no reason for concluding that the district court’s decision denying TIAA-CREF’s motion for discharge was an abuse of discretion.”

Prudential Ins. Co. v. Hovis, 553 F.3d 258 (3d Cir. 2009)

“Faced with competing claims to the proceeds of a $100,000 life insurance policy, Prudential Insurance Company of America filed an interpleader complaint against the claimants, seeking to deposit the disputed sum with the District Court and withdraw from the proceedings. One of the claimants, Robert C. Hovis, then counter-claimed, alleging that Prudential had acted negligently and in bad faith in its handling of the policy changes that led to the dispute.”

“Prudential then decided to pursue an interpleader action, rather than resolve who was entitled to the funds.”

“Shortly thereafter, Hovis reached a settlement with Potter and Gerski for distribution of the insurance proceeds.”

“The Court also granted summary judgment to Prudential on Hovis’s counter-claims on the ground that the appropriateness of Prudential’s interpleader action shielded it from any liability relating to its failure to resolve the dispute over the interpleaded funds.”

QBE Specialty Ins. Co. v. Kane, CIVIL 22-00450 SOM-KJM (D. Haw. Jan. 27, 2023)

“Airborne Wireless Network, 2018 WL 6016994, at *3. That is not so here. Multiple adverse claims have already been filed against QBE.”

“This case differs significantly from Bierman, which involved a putative claimant the court concluded would never file a claim because it was a corporation owned by the interpleader-plaintiff. 246 F.2d at 203. This case is also distinguishable from Beardslee, in which the supposedly adverse claimant had never asserted a right to the stake and there was no readily apparent basis for such a claim. 216 F.2d at 461.”

“As a result, the court denied the request for interpleader, finding an absence of good faith.”

Raymond James & Assocs. v. Bassford, 2:21-cv-01825-DCN (D.S.C. Mar. 7, 2022)

“DISCUSSION Since Patricia’s motion to enjoin Scott under the interpleader statute depends on the existence of a valid interpleader action, the court first addresses Raymond James’s motion for interpleader before turning to the motion to enjoin. The court ultimately finds that Raymond James has instituted a proper interpleader action, and accordingly, the court enjoins Scott and Patricia from continuing or pursuing any claims related to the interpleaded funds. A. Motion for Interpleader 1. Subject-Matter Jurisdiction “Interpleader is a procedural device that allows a disinterested stakeholder to bring a single action joining two or more adverse claimants to a single fund.” Sec.”

“Fort Dearborn Life Ins. Co. v. Turner for A.R.Y., 2006 WL 8438341, at *5 (E.D. N.C. Dec. 19, 2006); see also Lee, 688 F.3d at 1012 (observing that “many courts have held that those who have acted in bad faith to create a controversy over the stake may not claim the protection of interpleader” and collecting cases); 44B Am. Jur. 2d Interpleader § 7 (“The equitable doctrine of ‘clean hands’ applies to interpleader actions. The party seeking interpleader must do equity, not have caused the conflicting claims, and be free from blame in causing the controversy.”).”

Wilton Reassurance Life Co. of N.Y. v. Engelhardt, Civil Action 21-09968 (D.N.J. Apr. 28, 2022)

“At the first stage, “the court determines whether the interpleader complaint was properly brought and whether to discharge the stakeholder from further liability to the claimants.” Prudential Ins. Co. of Am. v. Hovis, 553 F.3d 258, 262 (3d Cir. 2009).”

“Id. at 263 (alteration in original) (quoting Farmers Irrigating Ditch & Reservoir Co. v. Kane, 845 F.2d 229, 232 (10th Cir. 1988)). The Third Circuit had difficulty in seeing how Prudential was “in any way to ‘blame [for] causing the controversy.’” Hovis, 553 F.3d at 263 (alteration in original) (quoting Farmers Irrigating Ditch, 845 F.2d at 232).”

“Hovis, 553 F.3d at 263. The court in Hovis reasoned that even if Prudential had proceeded faster, there was every indication it would have been sued by Potter and Gerski for the funds.”

Sevelitte v. The Guardian Life Ins. Co. of Am., 55 F.4th 71 (1st Cir. 2022)

“Lee, 688 F.3d at 1012 ; see also, e.g., Hovis, 553 F.3d at 263 (“[A] party seeking interpleader must be free from blame in causing the controversy ….” (quoting Farmers Irrigating Ditch & Reservoir Co. v. Kane, 845 F.2d 229, 232 (10th Cir. 1988) )); Primerica Life Ins. Co. v. Woodall, 975 F.3d 697, 700 (8th Cir. 2020) (“[I]f the party asserting the right to interpleader[ ] … has acted unfairly to create the underlying conflict necessitating interpleader relief, then that party may not use the interpleader procedure as a shield ….”). Here, though, Renee has failed to plausibly allege any bad faith by Guardian. The Divorce Agreement, not Guardian, is responsible for creating the ambiguity as to the beneficiary designation, and Guardian never denied liability under the Policy; Guardian merely sought to resolve the ambiguity by making Robyn aware of the Estate’s potential claim and ultimately seeking interpleader.”

Transamerica Life Ins. Co. v. Shubin, CASE NO. 1:11-cv-01958-LJO-SKO (E.D. Cal. Jul. 10, 2012)

“”In an interpleader action, the ‘stakeholder’ of a sum of money sues all those who might have claim to the money, deposits the money with the district court, and lets the claimants litigate who is entitled to the money.” Cripps v. Life Ins. Co. of N. Am., 980 F.2d 1261, 1265 (9th Cir. 1992). As such, the stakeholder forces the potential claimants to litigate who is properly entitled to the fund.”

“”Interpleader’s primary purpose is not to compensate, but rather to protect stakeholders from multiple liability as well as from the expense of multiple litigation.” Aetna Life Ins. Co. v. Bayona, 223 F.3d 1030, 1034 (9th Cir. 2000) (explaining that interpleaders are “governed by equitable principles”) (citations omitted). “Procedurally, an interpleader action encompasses two stages.”

“The second stage involves an adjudication of the adverse claims of the defendant claimants.””

Am. Gen. Life Ins. Co. v. Brown, DOCKET NO. 3:20-cv-00394-FDW-DSC (W.D.N.C. Feb. 12, 2021)

“Interpleader is appropriate when parties are engaged in a dispute about proceeds that remain in the hands of a third party who is willing to surrender such proceeds. See Equitable Life Assurance Soc’y. v. Jones, 679 F.2d 356, 358 n.2 (4th Cir.1982) (citations omitted).”

“Equitable concerns generally include the stakeholder acting in bad faith or unreasonable delay in bringing an interpleader action. Banner Life, 2011 WL 4565352, at *6.”

Lehto v. Allstate Ins. Co., 31 Cal.App.4th 60 (Cal. Ct. App. 1994)

“This is precisely what an insurer is required to do. (3) Plaintiff also theorized that Allstate’s conduct in filing and prosecuting the interpleader action constituted bad faith, relying on National Life Accident Ins. Co. v. Edwards (1981) 119 Cal.App.3d 326 [ 174 Cal.Rptr. 31] and Kelly v. Farmers Ins. Exchange (1987) 194 Cal.App.3d 1 [ 239 Cal.Rptr. 259].”

“It recognized, however, that the filing of an interpleader action will not sanitize a claim that is being prosecuted in bad faith.”

“While the filing of the interpleader action would not absolve Allstate of liability had it refused in bad faith to offer the policy limits to the Carbajals’ claimants, the filing of the interpleader, standing alone, cannot itself constitute an act of bad faith.”

“This situation is readily distinguishable from that of Allstate, which faced multiple bona fide claims against the Carbajals’ limited policy.”

“In fact, the interpleader action here had the intended result: It awarded plaintiff, the most seriously injured of the claimants, the $25,000 per person limit under the policy.”

Methven and Associates Professional Corporation v. Paradies-Stroud, No. C 13-01079 JSW (N.D. Cal. Jan. 21, 2014)

“The Stroud Defendants further argue that Plaintiff cannot maintain this interpleader action because it was brought in bad faith and because Plaintiff delayed too long before filing it. The authority to which the Stroud Defendants do not support these propositions.”

“Moreover, the Stroud Defendants have not demonstrated that filing the interpleader action, as opposed to giving the property directly to Ms. Stroud, was done in bad faith.”

Captain v. United Ohio Insurance Company, 2010 Ohio 2691 (Ohio Ct. App. 2010)

“Hoskins, supra, at 277, citing Hart, supra, at 188. Thus, to withstand United Ohio’s properly supported motion for summary judgment, the Appellants had to oppose the motion with evidence tending to show United Ohio arbitrarily or capriciously handled the claims against Willey. The term “arbitrary” means “without fair, solid, and substantial cause and without reason given; without any reasonable cause; * * * fixed or done capriciously or at pleasure; without adequate determining principle; not founded in the nature of things; nonrational; not done or acting according to reason or judgment; depending on the will alone; absolutely in power; capriciously; tyrannical; despotic.” 4D Investments, Inc. v. City of Oxford (Jan. 11, 1999), Warren App.”

“They essentially argue that the court utilized an improper legal standard to decide United Ohio’s summary judgment motion, i.e. it adopted a per se rule that filing an interpleader action is not bad faith. Instead, they argue the court should have considered whether the Appellants’ opposed the summary judgment motion with evidence tending to show United Ohio lacked a reasonable justification for its actions.”

Allstate Insurance v. Miller, 125 Nev. Adv. Op. No. 28, 49760 (2009), 212 P.3d 318 (Nev. 2009)

“Unless the policy says otherwise, an insurer does not have an independent duty to file an interpleader action on behalf of an insured. Nor is an insurer required to agree to a proposed stipulated judgment between the insured and the claimant if that stipulated judgment is beyond the policy limits.”

Cluck v. Mack, 489 S.W.2d 8 (Ark. 1973)

“In the answer she made the following allegations of bad faith: This interpleader action was filed in bad faith by the plaintiff for purposes of harassment and reducing the net amount of money which Margaret Ann Mack might obtain to go on her judgment of 10-7-70 against Charles Donald Cluck as evidenced by the following prior acts of this plaintiff: This plaintiff answered Margaret Ann Mack’s garnishment under her 10-7-70 judgment on Dec. 7, 1971, by claiming any money it held for or on behalf of Charles Donald Cluck was “contingent” on premiums being paid in full to 12-28-71 (when, in truth, said premiums were then fully paid to that date); and on any cash reserves under said policy not being depleted by loans to the insured (when, in truth.) the insured had never applied for any loan prior to service of the Writ); and on the insured being alive on 12-28-71 (a mere 21 days after the answer was filed). The answer of Charles Donald Cluck, filed April 7, 1972, asserted his claim to the fund and asked that both Blanche L. Cluck and Margaret Ann Mack be enjoined from the issuance of further writs of garnishment against the insurance policy proceeds.”

“The allegations in the complaint were not sustained by evidence — at least no evidence of any lack of good faith in the filing of the bill of interpleader was ever produced. The mere fact that an alleged claimant did not appear did not show lack of good faith on the part of the insurance company, and the fact that the claim of one or more of them turned out to be without merit, is not of controlling importance and is insufficient to furnish any basis for an inference that the filing was not in good faith, particularly in view of the fact that Blanche L. Cluck had, by one of the writs of garnishment asserted a claim to the proceeds.”

“Goad v. Goad, 238 Ark. 12, 377 S.W.2d 822.”

State Farm Life Ins. Co. v. Murphy, No. 2:15-cv-04793-DCN (D.S.C. Oct. 12, 2017)

“As explained in more depth in section III.2, the court finds that State Farm did not file its interpleader action without good cause or in bad faith.”

“The court can imagine a scenario where an insurer’s conduct in creating competing claims and delaying payments to a named beneficiary in the context of an interpleader action rises to the level of a viable bad faith claim. However, those facts are not present here.”

“Courts have been clear that where there is a reasonable ground for contesting a claim, and the court accepts the filing of the interpleader action, the insurer has not acted in bad faith by filing an interpleader claim. For example, in Minnesota Mutual Life Insurance Co. v. Ensley, 174 F.3d 977 (9th Cir. 1999), the Ninth Circuit upheld a district court’s determination that the insurer had acted reasonably in interpleading the policy benefits given its good faith belief that it faced the possibility of multiple claims.”

Nylife Distributors, Inc. v. Adherence Group, 72 F.3d 371 (3d Cir. 1995)

“Hence, one of two related questions we face is whether under section 1335, the district courts retain their traditional equitable discretion when deciding whether to hear a statutory interpleader case or defer to a state court; and the other is whether the district courts have a “virtually unflagging obligation” to exercise their section 1335 jurisdiction. In this regard, we find the Supreme Court’s decision in Weinberger v. Romeo-Barcelo, 456 U.S. 305 (1982), instructive.”

“See Bowles, 321 U.S. at 329. In support of their argument that the exceptional circumstances test set forth in Colorado River Water Conservation Dist. v. United States, 424 U.S. 800 (1976), should guide a district court’s decision to dismiss a federal interpleader action in favor of pending state proceedings, Gerasolo and Bleach rely heavily on section 1335(a), which states in pertinent part that “[t]he district courts shall have original jurisdiction of any civil action of interpleader or in the nature of interpleader. . . .” 28 U.S.C. §(s) 1335(a) (1993) (emphasis added).”

“On remand, the district court should determine, as a threshold matter, whether the state court action is indeed “parallel”; that is, whether it encompasses the competing claims to the Mainstay Mutual Fund monies that are raised here.”

Hicks v. Gabor, 354 Ga. App. 714 (Ga. Ct. App. 2020)

“On March 23, 2018, AOIC filed the instant Complaint for Interpleader and to Discharge Surety and Cancel the Bond. In the Complaint, AOIC stated that the claims against the Bond exceeded its remaining balance and asked the trial court to determine how to distribute the funds.”

“However, this is an interpleader action. The relevant interpleader statute, OCGA § 23-3-90 (a), states: Whenever a person is possessed of property or funds or owes a debt or duty, to which more than one person lays claim of such a character as to render it doubtful or dangerous for the holder to act, he may apply to equity to compel the claimants to interplead.”

“First, it must be determined whether the complainant had a right to interplead, and second, the interpleading defendants are required to litigate matters in dispute between themselves.”

Scruggs v. Merkel Cocke, 2000 CA 1370 (Miss. 2001)

“Since the claim filed by Merkel Cocke addressed the same parties and controversy as the action previously filed by SMBD in Jackson County Chancery Court, Merkel Cocke’s claim for interpleader should have been filed as a compulsory counterclaim in the Jackson County Chancery Court action pursuant to M.R.C.P. 13(a). In other words, we find that the interpled funds should have been pled as a compulsory counterclaim in the Jackson County Chancery Court litigation rather than filed as multiple litigation involving the same parties and controversies in another chancery court in another county.”

“As previously stated, we find that the Coahoma County Chancery Court erred in allowing Merkel Cocke to proceed with the interpleader and further erred in releasing Merkel Cocke from all liability in connection with the interpled funds. ¶ 26. The Coahoma County Chancery Court granted Merkel Cocke attorney fees against SMBD.”

“In Brown v. Hartford Ins. Co ., 606 So.2d 122, 127 (Miss. 1992), this Court stated: Sanctions are appropriate when a claim is either frivolous or filed for harassment value. . . . When a party espouses a viable legal theory, MRCP 11 sanctions are inappropriate.”

Midland Nat’l Life Ins. Co. v. Ingersoll, Case No. 13-C-1081 (E.D. Wis. Dec. 18, 2014)

“In recent years, several courts have held that a disinterested stakeholder should not obtain a fee award if filing the interpleader action could be viewed as part of the stakeholder’s normal or ordinary course of business. See, e.g., Minn. Mut. Life Ins. Co. v. Gustafson, 415 F. Supp. 615, 618-19 (N.D. Ill. 1976); Moore’s, supra; Wright et al., supra. These courts also hold that interpleader actions are generally part of the ordinary course of the insurance business. Chase Manhattan, 21 F.3d at 383; Gustafson, 415 F. Supp. at 618-19; Moore’s, supra; Wright et al., supra. This exception to the rule of awarding attorneys’ fees to a disinterested stakeholder appears to stem from Judge Friendly’s opinion in Travelers Indemnity Co. v. Israel, 354 F.2d 488 (2d Cir. 1965). In that case, the court held that a district court did not abuse its discretion in refusing to award fees to several insurance companies who initiated an interpleader action.”

Indianapolis Colts v. Mayor City Council, 775 F.2d 177 (7th Cir. 1985)

“The Second Circuit, interpreting the amended rule, declared that Rule 11 is violated where, “after reasonable inquiry, a competent attorney could not form a reasonable belief that the pleading is well grounded in fact and is warranted by existing law or a good faith argument for the extension, modification or reversal of existing law,” or “when it appears that a pleading has been interposed for any improper purpose.” Eastway Construction Corp. v. City of New York, 762 F.2d 243, 254 (2d Cir. 1985).”

“We must reiterate that in denying Baltimore’s motion for attorneys’ fees, the district court specifically found that Indianapolis had not acted with an improper purpose, and nothing in the record indicates that this conclusion was erroneous. Moreover, the above discussion establishing the justiciability of Indianapolis’ interpleader claim supports the district court’s finding that the claim was not filed for an improper purpose.”

“Clearly, the exercise of one’s legal rights to have a dispute resolved in federal court is not an abuse of the judicial process.”

Metropolitan Life v. Price, 501 F.3d 271 (3d Cir. 2007)

“MetLife stated that if the claimants did not resolve the matter amicably, it would bring suit. Price’s widow and the children negotiated, but they failed to reach an agreement.”

“The plaintiff in an interpleader action is a stakeholder that admits it is liable to one of the claimants, but fears the prospect of multiple liability. Interpleader allows the stakeholder to file suit, deposit the property with the court, and withdraw from the proceedings. The competing claimants are left to litigate between themselves.”

New York Life Ins. Co. v. Connecticut Dev. Auth, 700 F.2d 91 (2d Cir. 1983)

“Judgment discharging the stakeholder in an interpleader action may, of course, be delayed or denied if there are serious charges that the stakeholder commenced the action in bad faith.”

“In the present action, Sterling’s opposition to New York Life’s injunction motion charged that New York Life had listed CDA and MECCO as beneficiaries of the policies without Sterling’s knowledge or consent (Owens Aff. ¶ 7), for reasons of its own “greed and self-interest” ( id. ¶ 23). Had CDA or MECCO participated in the action and contested Sterling’s right to receive the cash surrender value of the policies, and had Sterling pursued his assertions as to New York Life’s bad faith, the district court would have been required to deal with these contentions in determining whether New York Life was entitled to any discharge from liability.”

Farmers Ins. Co. v. Romas, 947 P.2d 754 (Wash. Ct. App. 1997)

“On July 27, 1994, Farmers filed a complaint for interpleader on the grounds that Mr. Romas and the Paradiso Estate are both claiming that the other party was the driver at the time of the accident. Each is claiming entitlement to the $25,000 liability policy proceeds.”

“The complaint prays for declaratory relief asking the court to find that because Farmers deposited the funds with the court it has fulfilled its duty to defend either Mr. Romas as the named insured and/or the Paradiso Estate as the permissive insured.”

“In this case, Farmers would have a duty to defend both parties because both parties fit the definition of an insured person as established by case law.”

“However, the unilateral payment of policy limits into the registry of the court does not in and of itself relieve an insurer of its duty to defend. Viking, 57 Wn. App. at 349.”

AEG Westinghouse Transportation Systems, Inc. v. OEM Industrial Corp. (In re OEM Industrial Corp.), 135 B.R. 247 (Bankr. W.D. Pa. 1991)

“Furthermore, where the stakeholder has been dilatory in seeking judicial relief, and is thus culpable as to the difficulties encountered, an award may be denied. See John Hancock Mutual Life Ins. Co. v. Doran, 138 F. Supp. at 49 (“within one month after . . . realizing its predicament, [stakeholder] should have decided on a cause of action”). In the instant case, AEG did not seek to interplead for several months after the bankruptcy was filed. Although the parties were attempting to work out a settlement during this time, AEG was aware of all claims against it even before the bankruptcy was filed. The interpleader cause of action is designed specifically to limit a stakeholder’s exposure to liability.”

Trs. of the Elec. Workers Health & Welfare Trust v. F.A.S.T. Sys., Inc., 2:12-CV-148 JCM (CWH) (D. Nev. Jun. 27, 2013)

“Federal courts have the inherent power to punish conduct which abuses the judicial process, including accessing attorneys’ fees when a party has “acted in bad faith, vexatiously, wantonly, or for oppressive reasons.” Chambers v. NSDCO, Inc., 501 U.S. 32, 45-46 (1991) (citation omitted). When imposing sanctions under its inherent authority, a court must make an explicit finding of bad faith or willful misconduct.”

“An award of attorneys’ fees pursuant to the court’s inherent power is appropriate when plaintiff has acted in bad faith, has willfully abused the judicial process or has willfully disobeyed a court order.”

“Servs., Inc. v. Batarse, 115 F.3d 644, 648 (9th Cir. 1997) (“a finding of bad faith is warranted where an attorney ‘knowingly or recklessly raises a frivolous argument, or argues a meritorious claim for the purpose of harassing an opponent'”) (citation omitted).”

Shayne v. Discover Bank, C. A. 8:21–cv-03544-BHH-KFM (D.S.C. Jan. 26, 2022)

“There are seven motions pending before the court, including two by Discover and five by the plaintiff. Discover argues that this matter should be dismissed based upon res judicata as well as the pending New Jersey Interpleader Action (doc. 6). Discover also seeks sanctions pursuant to Rule 11 of the Federal Rules of Civil Procedure from the plaintiff for having to defend this lawsuit (doc. 16).”

“Discover asserts that the plaintiff’s lawsuit was filed for an improper purpose, because it was filed to harass Discover and violates the Interpleader Order (id.). For relief, Discover seeks to recover attorney’s fees and costs for defending this action as well as an order enjoining the plaintiff from filing future litigation regarding the Discover accounts in question in this court (id. at 5).”

Yonko v. W. Coast Life Ins. Co., CIVIL ACTION NO. 1:20-CV-00109-GNS-HBB (W.D. Ky. Apr. 15, 2021)

“B. Motion to Dismiss In both suits, Robert alleged breach of contract and bad faith claims against West Coast Life pursuant to O.C.G.A. § 33-4-6. In the Western District of Kentucky, West Coast Life moved to dismiss Robert’s bad faith claim. (Def.’s Mot. Dismiss, DN 39). Motions pursuant to Fed.”

“”[O]rdinarily, the question of good or bad faith is for the jury, but when there is no evidence of unfounded reason for the nonpayment, or if the issue of liability is close, the court should disallow imposition of bad faith penalties.” Amica Mut. Ins. Co. v. Sanders, 779 S.E.2d 459, 463 (Ga. Ct. App. 2015) (alteration in original) (internal quotation marks omitted) (citation omitted). Robert acknowledges failing to satisfy the sixty-day notice provision.”

“Even construing Robert’s allegations in the light most favorable to him, his counterclaim does not support a reasonable inference that West Coast Life’s refusal to pay under the Policy was frivolous and unfounded.”

Sun Life Assurance Co. of Canada v. Bew, 530 F. Supp. 2d 773 (E.D. Va. 2007)

“In order to avoid liability from conflicting claims, a disinterested stakeholder, such as the Plaintiffs, that had issued an insurance policy or managed an investment account, may interplead contested funds into a court’s registry to resolve the issue of proper distribution. The disinterested shareholder can then procure a judicial order for discharge from future liability. Fed.R.Civ.P. 22; Reliastar Life Ins. Co. of N.Y. v. LeMone, No. Civ.A. 7:05CV00545, 2006 WL 733968, at *10 (W.D.Va.”

“Furthermore, attorneys’ fees and costs may be awarded to a stakeholder in an interpleader action based on the rationale that the stakeholder, “by seeking resolution of the multiple claims to the proceeds, benefits the claimants, and . . . should not have to absorb attorneys’ fees in avoiding the possibility of multiple litigation.” Reliastar Life Ins. Co. of N.Y., 2006 WL 733968, at *9 (citations omitted).”

Wackeen v. Malis, 97 Cal.App.4th 429 (Cal. Ct. App. 2002)

“The plaintiff in this state interpleader suit was the law firm McIntyre, Borges Burns, LLP. The defendants were Torrance Management Company, Inc., REM Ltd., and The Foundation for Thoroughbred Sciences, Inc. The case settled when Torrance Management Company, Inc. waived a claim to the interpleaded trust deed and stipulated that the other two defendants in that case were entitled to sole possession of the deed. The plaintiff in the federal interpleader case was Torrance Management Company, Inc. The defendants were Moran, a William Malis, the United States of America, and others.”

The Bd. of Trs. of the Leland Stanford Junior Univ. v. Chiang Fang Chi-Yi, 13-cv-04383-BLF (N.D. Cal. Aug. 22, 2022)

“Life Ins., 2007 WL 4209405, at *2. The Court may also “enter its order restraining [all claimants] from instituting or prosecuting any proceeding in any State or United States court affecting the property . . . involved in the interpleader action” and “discharge the plaintiff from further liability.” 28 U.S.C. § 2361; see also In re 1563 28th Ave., San Francisco, CA 94112, 333 F.R.D. 630, 635 (N.D. Cal. 2019).”

Republic of the Phil. v. Pimentel, 553 U.S. 851 (2008)

Statutes (3)

Section 815 ILCS 340/8, 815 ILCS 340/8

“Any claim by a consumer which is found by the court to have been filed in bad faith or solely for the purpose of harassment, or in complete absence of a justifiable issue of either law or fact raised by the consumer, shall result in the consumer being liable for all costs and reasonable attorney’s fees incurred by the manufacturer or its agent, as a direct result of the bad faith claim. 815 ILCS 340/8 P.A. 85-894.”

Section 624.155 – Civil remedy, Fla. Stat. § 624.155

“The insurer files an interpleader action under the Florida Rules of Civil Procedure. If the claims of the competing third-party claimants are found to be in excess of the policy limits, the third-party claimants are entitled to a prorated share of the policy limits as determined by the trier of fact. An insurer’s interpleader action does not alter or amend the insurer’s obligation to defend its insured. (b) Pursuant to binding arbitration that has been agreed to by the insurer and the third-party claimants, the insurer makes the entire amount of the policy limits available for payment to the competing third-party claimants before a qualified arbitrator agreed to by the insurer and such third-party claimants at the expense of the insurer.”

Section 231:6F – Costs, expenses and interest for insubstantial, frivolous or bad faith claims or defenses, Mass. Gen. Laws ch. 231 § 6F

Regulation (1)

Section ATCP 1.33 – Costs upon frivolous claim, Wis. Admin. Code ATCP § ATCP 1.33

“The action, claim or defense was initiated or pursued in bad faith, solely for the purpose of harassing or maliciously injuring another. (b) The party or party’s attorney knew or should have known that the action, claim or defense was without any reasonable basis in law or equity, and could not be supported by a good faith argument for an extension, modification, or reversal of existing law. (3) If an administrative law judge issues an order under sub. (1) against a party other than a public agency, the administrative law judge may assess those costs against the party or the party’s attorney, or may allocate the cost assessment between the party and the party’s attorney. Wis.”

Analyses (9)

Sweeping Changes To “Bad Faith” In Florida

“Additionally, if two or more third-party claimants present competing claims arising out of a single occurrence, which when totaled may exceed the available policy limits of one or more of the insured parties, an insurer is not liable beyond payment of the available policy limits if the insurer, within ninety (90) days of receiving the claims, files an interpleader action and provides the policy limits to the court. The trier of fact then determines the amount of the policy limits to distribute to each claimant.”

Chris Lazarini Discusses Financial Institution’s Fiduciary Duty to Beneficiary

“UBS filed an interpleader action against Defendant and the person whom the client attempted to name as primary beneficiary on the accounts already distributed. Asserting her beneficiary status, Defendant counterclaimed and cross-claimed.”

“Upon the client’s death, UBS became a trustee, which is a fiduciary under New York law, holding the assets for Defendant’s sole benefit. As such, UBS owed Defendant at least a duty of due care, which it allegedly failed to meet in refusing to provide Defendant with information and in delaying distribution.”

“EIC: Interpleader actions, while casting the holder of the corpus as neutral, are fraught with liability issues for the actions taken by the holder.”

Florida Enacts Broad Insurance Reforms Focusing on Bad Faith

“The insurer will not be liable beyond the policy limit if, within 90 days after receiving notice of the competing claims in excess of the policy limit, the insurer either: Files an interpleader action in a Florida court for the policy limit. Upon agreement between the insurer and claimants, makes the policy limit available and submits the matter to binding arbitration. A third-party claimant whose claim is resolved in arbitration must execute and deliver a general release to the insured party whose claim is resolved by the proceeding.”

Florida Enacts Major Tort Reform and Bad-Faith Insurance Claim Legislation

“Under these safe harbors, an insurer can avoid bad-faith liability by making use of interpleader or arbitration procedures set forth in the bill. The bill also repeals sections of the Florida Statutes that previously allowed insureds to recover attorneys’ fees when prevailing in certain insurance coverage disputes.”

Florida’s Most Comprehensive Tort Reform in Decades and What it Means for Insurers and Bad Faith Law

“An insurer is not liable beyond the available policy limits for failure to pay all or any portion of a policy limit to the third-party claimants if, within 90 days after receiving notice of the competing claims, the insurer complies with one of the following: The insurer files an interpleader action under the Florida Rules of Civil Procedure. If the claims of competing third-party claimants are found to be in excess of an insurer’s policy limits, the third-party claimants will be entitled to a prorated share of the policy limits determined by a trier of fact.”

Interpleader with a Side of Motion for More Definite Statement

“In Meyer, the court found the facts did not support either statutory or rule-based interpleader. Meyer was not at risk for multiple or inconsistent judgments as the only parties claiming right to the funds in question were Defendants, who are clearly related and not adverse. As the court aptly noted, either the Defendants were entitled to the funds or they were not.”

The Wrong Way for a Trustee to Interplead Foreclosure Sale Proceeds

“The court ruled that an interpleader complaint must show that “the defendants make conflicting claims” to the disputed funds, and that the plaintiff “cannot safely determine which claim is valid.” The court found that these conditions were not present in this case.”

“Under section 2924k, a trustee must distribute proceeds from a foreclosure sale in the following order of priority: (1) costs and expenses of the sale; (2) payment of the debt secured by the deed of trust; (3) payment of any junior liens or encumbrances; and (4) payment to the trustor (who is normally the borrower). Placer applied the sale proceeds in accordance with numbers 1 through 3 on that statutory priority list, but failed to pay the remaining proceeds to Aflalo.”

“Lesson Under thePlacer Title opinion, interpleading surplus proceeds from a foreclosure sale is NOT appropriate where there are no competing recorded claims before the sale, and where section 2924k clearly requires the surplus proceeds be given to the trustor. [View source.]”

The Impact of Florida’s Tort Reform Bill on Insurance Litigation

“If two or more third party claimants have competing claims arising out of a single occurrence, which in total may exceed the insured’s available policy limits, the insurer does not commit bad faith by failing to pay if, within 90 days after receiving notice of the competing claims, the insurer either files an interpleader action or follows the arbitration procedures outlined in the bill.”

Key issues for policyholders under Florida’s new tort reform bill

“Also included are two new procedural devices for cases involving multiple completing claims against an insured (or insureds). Under new § 624.155(6), an insurer can now shield itself from bad faith exposure by either (a) filing an interpleader action to determine the claimants’ prorated share of the policy limits, or (b) entering into a binding arbitration proceeding agreed to by the insurer and the claimants, where a “qualified arbitrator” (paid for by the insurer) determines the claimants’ prorated share of the policy limits.”

Nevada HOA homeowners need of Bill of Rights to ensure anti-homeowner bills like SB 417 don’t pass

CAI lobbyists who are also HOA attorneys have a major conflict of interest

Nevada has long had many HOA homeowner protections built into state law, but speaking from personal experience of living in an HOA where the attorney is also the debt collector and also the CAI lobbyist, the law doesn’t matter because he interprets it to be something other than what the black letter of the law says.

He says the law is what is most favorable to himself and to the other CAI affiliate managers/agents, not they fare in danger because the lobbying organization for the HOA attorneys, managing agents, debt collectors, and other vendors who “service” (in every sense of the term” HOAs, the Community Association Institute (CAI) has been chipping away at homeowner rights and building in rights for HOA agents who are supposed to be fiduciaries.

In 2006, AARP wrote an amicus brief to a case where an HOA prohibited people from posting political signs.

The AARP amicus brief in Committee for a Better Twin Rivers v. Twin Rivers Homeowners Association argues that HOAs may violate the following homeowner rights:

The right to free speech
The right to due process
The right to privacy
The right to equal protection
The right to a fair hearing
The right to be free from discrimination

The AARP brief argues that HOAs often have rules that violate these rights. For example, HOAs may have rules that prohibit political speech, that require homeowners to get permission before making changes to their homes, that allow HOAs to access homeowners’ homes without a warrant, that discriminate against certain groups of people, or make it difficult for homeowners to challenge HOA decisions.

The AARP brief argues that homeowners should be aware of their rights and that they should not hesitate to challenge HOA rules that they believe are unfair or unreasonable. The brief also argues that state and federal governments should enact laws that protect the rights of homeowners.

Here are some specific examples of how HOAs may violate homeowner rights:

An HOA may prohibit political signs on residents’ property.
An HOA may require homeowners to get permission before making changes to their homes, such as painting their house or adding a fence.
An HOA may allow HOA board members to access homeowners’ homes without a warrant.
An HOA may discriminate against certain groups of people, such as families with children or people with disabilities.
An HOA may make it difficult for homeowners to challenge HOA decisions, such as by requiring homeowners to pay high filing fees or by requiring homeowners to go through a lengthy appeals process.

The AARP brief argues that this model bill of rights would be a valuable tool for protecting the rights of homeowners. The bill of rights would help to ensure that homeowners are treated fairly and that their voices are heard. The bill of rights would also help to promote transparency and accountability in HOAs.

2006 Model HOA Homeowner Bill of Rights

The right to free speech: Homeowners have the right to express their views on matters of public concern, including by displaying political signs on their property.
The right to due process: Homeowners have the right to fair notice and a fair hearing before they can be subject to disciplinary action by their HOA.
The right to privacy: Homeowners have the right to privacy in their homes and on their property. HOAs cannot unreasonably intrude on homeowners’ privacy.
The right to equal protection: Homeowners have the right to be treated equally under the law, regardless of their race, religion, national origin, sex, age, or disability.
The right to a fair hearing: Homeowners have the right to a fair hearing before their HOA can take disciplinary action against them. The hearing must be conducted in a timely manner and must be fair and impartial.
The right to be free from discrimination: Homeowners have the right to be free from discrimination by their HOA. HOAs cannot discriminate against homeowners on the basis of race, religion, national origin, sex, age, or disability.
The right to know about HOA rules and regulations: Homeowners have the right to know about the rules and regulations of their HOA. The HOA must provide homeowners with a copy of the rules and regulations in a timely manner.
The right to participate in HOA meetings and elections: Homeowners have the right to participate in HOA meetings and elections. Homeowners must be given reasonable notice of HOA meetings and elections.
The right to appeal HOA decisions: Homeowners have the right to appeal HOA decisions. Homeowners must be given a fair opportunity to appeal HOA decisions.
The right to be free from unreasonable fines and fees: Homeowners have the right to be free from unreasonable fines and fees. HOAs cannot impose fines and fees that are excessive or that are not reasonably related to the cost of providing services to homeowners.
The right to be free from harassment and intimidation: Homeowners have the right to be free from harassment and intimidation by their HOA. HOA board members and employees cannot harass or intimidate homeowners.

The AARP amicus brief argues that this model bill of rights would be a valuable tool for protecting the rights of homeowners. The bill of rights would help to ensure that homeowners are treated fairly and that their voices are heard. The bill of rights would also help to promote transparency and accountability in HOAs.

Judge Peterson forgot I was the victim and thinks Scow did nothing wrong keeping the excess proceeds from the HOA sale for 8+years

What the law requires

What interpleader standard is

“Legal Standard “In an interpleader action, the ‘stakeholder’ of a sum of money sues all those who might have a claim to the money, deposits the money with the district court, and lets the claimants litigate who is entitled to the money.” Cripps v. Life Ins. Co. of N. Am., 980 F.2d 1261, 1265 (9th Cir. 1992)

“Accordingly, many courts have held that those who have acted in bad faith to create a controversy over the stake may not claim the protection of interpleader. See, e.g., Kent v. N. Cal. Reg’l Office of Am. Friends Serv. Comm., 497 F.2d 1325, 1328 (9th Cir.1974) (“Interpleader, which is an equitable remedy, is not available to one who has voluntarily accepted funds knowing they are subject to competing claims.”) (citations omitted); Farmers Irrigating Ditch & Reservoir Co. v. Kane, 845 F.2d 229, 232 (10th Cir.1988) (“It is the general rule that a party seeking interpleader must be free from blame in causing the controversy, and where he stands as a wrongdoer with respect to the subject matter of the suit or any of the claimants, he cannot have relief by interpleader.”) (collecting cases); see also44B Am. Jur. 2d Interpleader § 7 (“The equitable doctrine of ‘clean hands’ applies to interpleader actions.”

Rule 22 of the Federal Rules of Civil Procedure allows interpleader of disputed funds where a Plaintiff is subject to double or multiple liability. Perfekt Mktg., LLC v. Luxury Vacation Deals, LLC, 2015 WL 10012987, at *2 (D. Nev. Nov. 16, 2015). The purpose of the interpleader is for the stakeholder to “protect itself against the problems posed by multiple claimants to a single fund.” Lee v. W. Coast Life Ins. Co., 688 F.3d 1004, 1009 (9th Cir. 2012).

What interpleader asks the court to do

An interpleader action typically involves two stages. Id. In the first stage, the district court decides whether the requirements for a rule or statutory interpleader action have been met by determining if there is a single fund at issue and whether there are adverse claimants to that fund. Id. If the Court finds that the interpleader action has been properly brought, it then makes a determination of the respective rights of the claimants. Id.”)

What the facts here are

Red Rock instructed Steven Scow to interplead $57,282.32 on 8/28/14 which was declared “excess funds” after Red Rock took its fees and the HOA had been paid in full. Red Rock did not have standing in 2021 to file an interpleader action.

Steven Scow concealed his and other’s wrongdoing

Steven Scow concealed his possession of the money and its location. He hid the fact that all named defendants had released their liens before the conclusion of the first action. Scow obscured his obstruction of my claim for the proceeds in the first action by refusing to provide them during mediation. He also hindered my second civil claim for the proceeds by filing a motion to dismiss it with prejudice, citing res judicata and the failure to include the HOA as a necessary party.

Scow further obscured his interference with my quiet title claims in the first two actions by providing inaccurate, incomplete, false, and falsified Red Rock foreclosure records. This prevented the sale from being entirely voided and allowed Nationstar and its co-conspirators to commit fraud on the court by having the sale declared valid regarding the sub-priority.

The attorneys perpetrated fraud on the court, covering up that Red Rock rejected assessments that cured the default three times, the sale would have been fairly voided in its entirety in the 1st action, and we would not be still litigating four years later without a judge ever looking at the evidence.

I was the sole claimant after June 3, 2019

3/12/15 Wells Fargo released the lien of the 2nd deed of trust

3/28/17 Gordon B. Hansen Trust closed and assigned its title interest to sole beneficiary Nona Tobin as an individual

6/3/19 Nationstar released the lien of the 1st deed of trust

What Judge Peterson believes despite the law and the facts supported by the evidence

She believes there is some unwritten law that says Red Rock doesn’t have to distribute the proceeds after the sale if someone might try to unwind the sale years later.

Judge Peterson buys into Red Rock’s argument so much she argues for them.

Judge Peterson’s argument matches Nationstar’s 4/26/21 argument also when she allowed multiple disinterested entities to oppose the funds being distributed to the sole claimant.

I didn’t file any quiet title claims against Nationstar in the 1st action and Nationstar didn’t file any against me.

I wanted the sale to be void to return to our respective positions. Nationstar filed for summary judgment against the Hansen trust, but not against me as an individual, met ex arte with the judge, got me removed as an individual party and got all my evidence suppressed, lied to the court to say that it was BANA’s successor in interest, then rescinded that claim a week after the end of discover, filed motion after motion to prevent me from being able to return to my pro se status to be able to represent myself or to be the real party in interest after the Hansen Trust was closed, made a fraudulent side deal with Jimijack, filed motions to have me declared a vexatious litigant, opposed the excess proceeds to be distributed to me as the sole claimant, and on and on and on.

Why? Because Nationstar had no standing to foreclose

Because if the sale were voided in its entirety, than Nationstar would have to prove based on evidence that it actually had NRS 104.3301 standing to foreclose, and we both knew it couldn’t.

Thus, by eliminating my involvement, Nationstar obtained $355,000 for releasing the lien on the 1st deed of trust, which they falsely claimed to own from non-party Joel A. Stokes, on June 3, 2019, just two days prior to the show trial in the 1st action – a trial that neither Joel Stokes nor Nationstar were required to attend, and from which I was barred – all documentary evidence and witnesses were excluded.

For the result of a meritless interpleader action to be the preclusion of all the victim’s claims and the imposition of a vexatious litigant restrictive order for forced defense against entities who have no standing is unfair and disproportionate.