In Nationstar Mortgage, LLC v. Saticoy Bay LLC Series 2227 Shadow Canyon, 133 Nev., Adv. Op. 91, Case No. 70382 (Nov. 22, 2017), the Nevada Supreme Court declined to adopt the Restatement (Third) of Property: Mortgages § 8.3 (1997) which states that a court is generally justified in setting aside a foreclosure sale when the sales price is less than 20 percent of the property's fair market value. First, the Court concluded that U.C.C. Article 9's commercial reasonableness standard is inapplicable to HOA foreclosure sales. Second, since HOA real property foreclosure sales are not subject to Article 9's commercial reasonableness standard, the Court held that they are governed by the longstanding framework for evaluating any other real property foreclosure sale. Therefore, Golden v. Tomiyasu, 79 Nev. 503, 514, 387 P.2d 989, 995 (1963) was upheld by the Nevada Supreme Court in regard to foreclosure sales, including HOA foreclosure sales, and continues to remain the law in Nevada. "Thus, we continue to endorse Golden's approach to evaluating the validity of foreclosure sales: mere inadequacy of price is not in itself sufficient to set aside the foreclosure sale, but it should be considered together with any alleged irregularities in the sales process to determine whether the sale was affected by fraud, unfairness, or oppression. However, it necessarily follows that if the district court closely scrutinizes the circumstances of the sale and finds no evidence that the sale was affected by fraud, unfairness, or oppression, then the sale cannot be set aside, regardless of the inadequacy of price." Nationstar, 133 Nev., Adv. Op. 91, at *10 - 11 (citing Golden, 79 Nev. at 515 - 16, 387 P.2d at 995). The Court then found that the following did not amount to fraud, unfairness, or oppression: (1) the inclusion of fines in the HOA lien; (2) the notice of sale's failure to list the unpaid lien amount on the date of sale; and (3) the person who signed the notice of default was not the person who the HOA president designated to sign the notice. See id. at *11 - 15.
Chapter 7 bankruptcy, also known as liquidation bankruptcy, is a relatively straightforward process for individuals who qualify for this particular chapter of consumer bankruptcy. However, disputes over who actually owns the property to be liquidated can muddy the waters, adding complicated measures to the process.