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Case 17-05016-btb Doc 39 Entered 04/16/18 10:01:05 Page 1 of 14
WRIGHT, FINLAY & ZAK, LLP
Dana Jonathon Nitz, Esq.
Edgar C. Smith, Esq.
Nevada Bar No. 5506
Yanxiong Li, Esq.
(702) 475-7964; Fax: (702) 946-1345
yli@wrightlegal.net
Attorneys for Plaintiffs, Fred Sadri, individually and as Trustee for The Star Living Trust, dated April 14, 1997; Ray Koroghli, individually; Ray Koroghli and Sathsowi T. Koroghli, as Managing Trustees for Koroghli Management Trust
UNITED STATES BANKRUPTCY COURT
DISTRICT OF NEVADA
Case No.: 16-50644-btb
Chapter 15
Adversary No.: 17-05016-btb
MOTION FOR PARTIAL SUMMARY JUDGMENT ON PLAINTIFFS’ QUIET TITLE/DECLARATORY RELIEF CAUSE OF ACTION
In re: JAZI GHOLAMREZA ZANDIAN,
Debtor
PATRICK CANET,
Foreign Representative
FRED SADRI, AS TRUSTEE FOR THE STAR LIVING TRUST, DATED APRIL 14, 1997; RAY KOROGHLI AND SATHSOWI T. KOROGHLI, AS MANAGING TRUSTEES FOR KOROGHLI MANAGEMENT TRUST,
Plaintiffs,
vs.
JED MARGOLIN; JAZI GHOLAMREZA ZANDIAN; and all other parties claiming an interest in real properties described in this action.
Defendants
Hearing Date: June 13, 2018
Hearing Time: 2:00 p.m.
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PATRICK CANET,
Counterclaimant,
vs.
FRED SADRI, INDIVIDUALLY AND AS TRUSTEE FOR THE STAR LIVING TRUST, DATED APRIL 14, 1997; RAY KOROGHLI, INDIVIDUALLY; RAY KOROGHLI AND SATHSOWI T. KOROGHLI, AS MANAGING TRUSTEES FOR KOROGHLI MANAGEMENT TRUST,
Counter-defendants
PATRICK CANET,
Crossclaimant,
vs.
JED MARGOLIN,
Cross-defendant
COMES NOW Plaintiffs FRED SADRI, AS TRUSTEE FOR THE STAR LIVING TRUST, DATED APRIL 14, 1997 (“SL Trust”) and RAY KOROGHLI and SATHSOWI T. KOROGHLI, AS MANAGING TRUSTEES FOR KOROGHLI MANAGEMENT TRUST (“KM Trust”) (hereinafter “Plaintiffs”), by and through their attorneys of record, the law firm of Wright, Finlay & Zak, LLP, moves this Court for summary judgment in their favor on the First Cause of Action for Quiet Title/Declaratory Relief in the Adversary Complaint.
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This Motion is based upon the accompanying Memorandum of Points and Authorities, separate Statement of Undisputed Facts filed concurrently herewith, Declaration of Yanxiong Li, Esq., such matters as may be judicially noticed, the court’s own records in this matter, and on such other and further evidence as may be presented at the hearing on this Motion.
MEMORANDUM OF POINTS AND AUTHORITIES
I. INTRODUCTION
This dispute over title to
certain vacant land parcels in
Plaintiff is not now, nor has ever been, a party to the underlying action by which Margolin obtained judgment against Zandian. Plaintiff did not transfer any interest in the parcels to the judgment debtor. Plaintiffs are not joint tenants with the judgment debtor.
In addition, Margolin did not give Plaintiffs notice of any execution sale, and never recorded an affidavit as required for a proper judgment abstract under NRS 17.150, raising doubt as to whether Margolin even had an enforceable lien against any of the affected parcels before the execution sale.
The proof of these items is a matter of public record and not subject to reasonable dispute. Thus, and as a matter of law, Margolin did not Plaintiffs’ interest in the parcels, and any interest Margolin acquired through execution on his judgment is simply that of a tenant in common.
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II. STATEMENT OF UNDISPUTED FACTS
Plaintiffs’ Interest in the
Nine Parcels of the Property Plaintiffs own two-thirds undivided interest in
nine (9) parcels of land (collectively hereinafter as the “Property”)1 located in
TABLE
A:
|
Date Recorded
|
Description |
Instrument Number |
|
8/6/2003 |
Grant, Bargain And Sale Deed transferring an undivided 2/3 interest in the Property to Plaintiff SL Trust and Ray Koroghli, an unmarried man.
|
29005922
|
|
5/12/2009 |
Quitclaim Deed transferring an undivided 1/3 interest in the Property from Ray Koroghli to Plaintiff KM Trust.
|
37586593 |
Defendant Jed Margolin’s Claim to Three Parcels of the Property
Defendant Jed Margolin (“Margolin”) claims he is “the sole title owner of the property in question.”[4] Public records show only that Margolin obtained an interest in Parcels 2, 4 and 8.
____________________
[1] The parcels are specifically identified by the following assessor’s parcel numbers:
a. 079-150-09 (Parcel 1);
b. 079-150-10 (Parcel 2);
c. 079-150-13 (Parcel 3);
d. 084-040-02 (Parcel 4);
e. 084-040-04 (Parcel 5);
f. 084-040-06 (Parcel 6);
g. 084-040-10 (Parcel 7);
h. 084-130-07 (Parcel 8);
i. 084-140-17 (Parcel 9).
[2] See Plaintiff’s Statement of Undisputed Facts (“SOUF”) at 3 and Exhibit A.
[3] SOUF at 3 and Exhibit A.
[4] SOUF at 3 and Exhibit B.
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of the Property by the following instruments
recorded in the official records of
TABLE B:
|
Date Recorded |
Description |
Instrument Number |
|
6/26/2013 |
Default Judgment in favor of Margolin against Optima
Technology Corp., a corporation;
Optima Technology Corp., a corporation; and Zandian.
|
42696315 |
|
/9/2015
|
Sheriff’s Certificate of Sale of Property recites a purported auction of Parcel 8 on 4/3/2015 of “all right, title and interest of the said judgment debtor…to Jed Margolin.”
|
44560216 |
|
9/8/2016 |
Sheriff’s Deed Upon Execution of Real Property transferring “all of the rights, title interest and claim belonging to Judgment Debtors” in Parcel 8 to Jed Margolin.
|
46301347 |
|
4/9/2015 |
Sheriff’s Certificate of Sale of Property recites a purported auction of Parcel 4 on 4/3/2015 of “all right, title and interest of the said judgment debtor…to Jed Margolin.”
|
44560328 |
|
9/8/2016 |
Sheriff’s Deed Upon Execution of Real Property transferring “all of the rights, title interest and claim belonging to Judgment Debtors” in Parcel 4 to Jed Margolin.
|
46301339 |
|
4/9/2015 |
Sheriff’s Certificate of Sale of Property recites a purported auction of Parcel 2 on 4/3/2015 of “all right, title and interest of the said judgment debtor…to Jed Margolin.”
|
445602010 |
|
9/8/2016
|
Sheriff’s Deed Upon Execution of Real Property |
463013511
|
___________________
[5] SOUF at 4 and Exhibit A.
[6] SOUF at 4 and Exhibit A.
[7] SOUF at 4 and Exhibit A.
[8] SOUF at 4 and Exhibit A.
[9] SOUF at 4 and Exhibit A.
[10] SOUF at 4 and Exhibit A.
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|
|
transferring “all of the rights, title interest and claim belonging to Judgment Debtors” in Parcel 2 to Jed Margolin. |
|
Plaintiffs are not named as the “defendants” or “judgment debtors” in the Default Judgment; in the Sheriff’s Certificates of Sale; or in the Sheriff’s Deeds referenced above.[12] Itis undisputed that no notice was sent to either Plaintiff regarding the April 3, 2015 execution sales (“Execution Sales”) recited in the Sheriff’s Certificates of Sale and Sheriff’s Deeds above.[13] Additionally, no Affidavit of Judgment or similar document containing information regarding the judgment debtor required under NRS 17.150(4)(a)-(d) was recorded concurrently with the Default Judgment in the official records of Washoe County, Nevada.[14]
Defendant Zandian confirms Plaintiffs’ Interest in the Property
Defendant Zandian, judgment debtor, admits that SL Trust is now and at all times relevant herein, the co-owner of one-third (1/3) undivided interest in title to the Property under the Grant, Bargain and Sale Deed signed by Nevada Land and Resources Company, and recorded on August 6, 2003 as Instrument No. 2900592 in the Washoe County Recorder’s Office.[15]
Defendant Zandian also admits that KM Trust is now and at all times relevant herein, the co-owner of one-third (1/3) undivided interest in title to the Property under a Quitclaim Deed signed by Ray Koroghli, and recorded on May 12, 2009 as Instrument No. 3758659 in the Washoe County Recorder’s Office.[16] Together, these conveyances conveyed 2/3rds of the title in all nine (9) parcels to Plaintiffs.
III. REQUEST FOR JUDICIAL NOTICE
Many of the preceding facts are supported by admissible evidence introduced by the testimony of a qualified witness; the remainder are judicially noticeable facts that are either “generally known” or that “can be accurately and readily determined from sources whose
____________________
[11] SOUF at 4 and Exhibit A.
[12] See SOUF at 5 and Exhibit A.
[13] SOUF at 5 and Exhibit C.
[14] SOUF at 5 and Exhibit A.
[15] SOUF at 5 and Exhibit D.
[16] SOUF at 6 and Exhibit D.
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accuracy cannot reasonably be questioned.” Fed. R. Evid. 201. Plaintiffs respectfully requests that the Court take judicial notice of the recorded title instruments and judicial filings attached as Exhibits 1-12. The Court should take judicial notice of the majority of the facts discussed in Tables A and B above as they are facts derived from publicly available records of the Washoe County Recorder, and are thus, judicially noticeable. See Disabled Rights Action Comm. v. Las Vegas Events, Inc., 375 F.3d 861, 866 & n.1 (9th Cir. 2004) (court may take judicial notice of the records of state agencies and other undisputed matters of public record under Fed. R. Evid. 201); Harlow v. MTC Fin. Inc., 865 F. Supp. 2d 1095, 1097 (D. Nev. 2012) (“When ruling on a motion for summary judgment, the Court may take judicial notice of matters of public record, including recorded documents.”). The remaining undisputed facts are based on admissions. Therefore, all of the evidence is properly before the court, authenticated, and competent to establish the Plaintiffs’ prima facie case.
IV. LEGAL STANDARD FOR REVIEW
Summary judgment is proper when
there is no issue of material fact and the movant is
entitled to judgment as a matter of law. Fed. R. Civ.
P. 56(a); see also Celotex Corp. v. Catrett,
477
V. ARGUMENT
A. MARGOLIN’S JUDGMENT LIEN AND RELATED EXECUTION SALES AFFECT ONLY ZANDIAN’S INTEREST IN THE PROPERTY.
Plaintiffs are entitled to a decree and declaration confirming their two-thirds’ (2/3) ownership interest in the Property because Margolin’s purported judgment lien and execution sales affects only Zandian’s one-third (1/3) interest in the Property. These facts are derived from public records and cannot be reasonably disputed by Margolin.
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Property interests are created
and defined by state law. Butner v. United
States, 440
A transcript of the original docket or an
abstract or copy of any judgment or decree of a district court of the State of
of the
judgment or decree was rendered, may be recorded in the office of the county recorder in any county, and when so recorded it becomes a lien upon all the real
property of the judgment debtor not exempt from execution in that county, owned by the judgment debtor at the time, or which the judgment debtor may afterward
acquire, until the lien expires.
See also NRS 21.190 ([u]pon a sale of real property, the purchaser shall be
substituted to and acquire all the right, title, interest and claim of the
judgment debtor thereto) (Emphasis added). In other words, under
Additionally, it is well settled within this Circuit that the doctrine of caveat emptor applies to execution sales such that interest acquired at such sales is subject to “any rights and equities of third- parties which are capable of being enforced against the judgment debtor.” See Northern Mining Corporation v. Trunz, 124 F.2d 14, 18 (9th Cir. 1941); see also Tonopah Banking Corp. v. McKane Mining Co. of Tonopah, 31 Nev. 295, 103 P. 230, 231 (Nev. 1909) (The fact that the plaintiff may have intended to have bid in the whole property to satisfy the judgment, but failed to do so, and bid the full amount of the purchase price erroneously for a portion of the property, cannot affect the legal status of the situation. The law of caveat emptor applies to all judicial and execution sales with equal force as it does to other sales of property, except where fraud may be claimed or maintained); United States v. Fishing Vessel Pan Alaska, 315 F. Supp. 1005, 1007 (D. Alaska 1970) (The well established general rule, however, is that the principle of caveat emptor applies to execution sales, and the purchaser receives only the actual interest of the debtor and no more) (citing Reynolds v. Reynolds, 54 Cal.2d 669, 7 Cal.Rptr. 737, 355 P.2d 481, 488 (1960)
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(en banc); Sander v. Wells, 71 Wash.2d 25, 426 P.2d 481, 484 (1967); 30 AM.JUR.2D EXECUTIONS 430 (1967)); Nussbaumer v. Superior Court In & For Yuma Cty., 107 Ariz. 504, 508, 489 P.2d 843, 847 (1971) (the execution purchaser cannot set up, as a defense to his liability for the purchase money or for a deficiency on a resale, defects in the debtor’s title, the existence of encumbrances, a deficiency in quantity of the land, or, in the absence of artifice or fraud, that the price bid is more than the property is worth). Here, the public records show Plaintiffs owned two-thirds interest in the nine (9) parcels of the Property at the time of the Margolin’s execution
sales on three (3) of them. Plaintiffs are not judgment debtors. Thus, Margolin could only have executed against whatever interest Zandian held at the time of the execution sales. Moreover, any interest Margolin acquired through his execution sales must be subject to the rights of Plaintiffs under the Stipulation for Final Resolution of Litigation (“Stipulated Judgment”) that might be enforced against Zandian.17 Especially where, as in this case, the Stipulated Judgment expressly binds all successors and assigns of Zandian as to rights, claims and interest to property governed thereby, including the subject parcels.[18]
Margolin will likely argue that Zandian held all of the ownership interest in the three parcels of the Property based upon a “Judgment Confirming Arbitration Award” (“JCAA”) that allegedly transferred Plaintiffs’ two-thirds interest to Zandian.[19] This argument is flawed for at least two reasons.
First, the JCAA does not purport to convey title to anything; that is, the JCAA is not self-executing with respect to transfer of the Property. Clover Valley Land & Stock Co. v. Lamb, 43 Nev. 375, 386, 187 P. 723, 727 (1920) (decree or judgment is not self-executing if it must be enforced by some person authorized by law); see also BOUVIER LAW DICTIONARY (“A self-executing instrument is any instrument that is sufficient on its face to determine what obligations are imposed as a result of its underlying commitment, so that no further instrument must be drafted or act taken in order for the instrument to take effect and be enforced.”) Here, the JCAA
requires “Defendants to execute and deliver to [Zandian’s] counsel…” various deeds effectuating
_____________________________
[17] See SOUF at Exhibit A..
[18] See SOUF at Exhibit A.
[19] See SOUF at Exhibit A.
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the transfer of property interest. As the public record shows, this was never done. See Exhibit 11 and Li Declaration at ¶9.
Second, and more significantly, the JCAA was superseded by the Stipulated Judgment that confirms Plaintiffs’ two-thirds interest in the Property.20 Margolin was not a party to the JCAA and the Stipulated Judgment was entered on July 14, 2008, well before the first execution sale took place. He never levied upon the judgment, nor sought to obtain any assignment of rights under it. Plaintiffs were free to negotiate and settle the dispute giving rise to the JCAA and so that occurred here. Thus, Margolin obtained, at most, Zandian’s one-third interest in Parcels 2, 4 and 8 by his execution sales. Because the Margolin’s execution sales did not divest Plaintiffs of their two-thirds interest in the Property, summary judgment should be granted in favor of Plaintiffs.
B. ALTERNATIVELY, MARGOLIN’S JUDGMENT LIEN AND EXECUTION SALES PURSUANT THERETO ARE VOID FOR HIS FAILURE TO COMPLY WITH NRS 17.015(4).
It is well-settled law under NRS
17.150(4) that “for the purpose of creating a lien upon the real property of
the judgment debtor,” judgment creditors, (like Margolin),
shall record an Affidavit of Judgment. This Affidavit requirement is intended
to provide more specific identifying information to avoid “unnecessarily
clouding innocent people’s title” whom happen to have
names similar to judgment debtors.
e.g., Clark Cty. v. S. Nev. Health Dist., 128 Nev. 651, 656, 289 P.3d 212, 215 (2012) (“If the Legislature's intention is apparent from the face of the statute, there is no room for construction, and this court will give the statute its plain meaning”); see also Alcove Inv., Inc. v. Conceicao (In re Conceicao), 331 B.R. 885, 894 (B.A.P. 9th Cir. 2005) (“in construing California’s counterpart to NRS 17.150(4), the 9th Circuit B.A.P. held that judgment lien was invalid where judgment creditor failed to include debtor’s social security number or indicate that it is unknown when [20] See SOUF at 5 and Exhibit A.
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recording the judgment.”). Here, Margolin’s Default Judgment likewise fails to provide any of the information regarding the judgment debtor required under NRS 17.150(4), so recording it cannot be deemed compliance with NRS 17.150(4). Nor has Margolin recorded any Affidavit of Judgment concurrently with the Default Judgment to supplement this information. See Exhibit 3 and Li Declaration at ¶5. Thus, Margolin made no effort to comply with the statutory requirements for creating a judgment lien, and as such, does not hold any valid judgment lien against the Property. Additionally, because there is no valid judgment lien, Margolin’s execution sales should be declared void, and ineffective in transferring any interest in Parcels 2, 4 and 8.
Accordingly, summary judgment should be granted in favor of Plaintiffs confirming their two-thirds interest in the Property.
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CONCLUSION
Based on the foregoing, Plaintiffs request that this Court enter a judgment declaring that title to the Property is vested in FRED SADRI, AS TRUSTEE FOR THE STAR LIVING TRUST, DATED APRIL 14, 1997 as to a one-third undivided interest and in RAY KOROGHLI AND SATHSOWI T. KOROGHLI, AS MANAGING TRUSTEES FOR KOROGHLI MANAGEMENT TRUST as to a one-third undivided interest. Further, Plaintiffs seek a declaration that Margolin acquired, if any, only Zandian’s undivided interest in the Property subject to the rights and equities under the Stipulated Judgment that may be enforced against Zandian.
DATED this 16th day of April, 2018.
WRIGHT, FINLAY & ZAK, LLP
/s/ Yanxiong Li, Esq.
Dana Jonathon Nitz, Esq.
Edgar C. Smith, Esq.
Nevada Bar No. 5506
Yanxiong Li, Esq.
Fred Sadri, as Trustee for The Star Living Trust, dated April 14, 1997; Ray Koroghli and Sathsowi T. Koroghli, as Managing Trustees for KoroghliManagement Trust
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CERTIFICATE OF SERVICE
I, Kelli Wightman, am an employee of Wright, Finlay & Zak, LLP and I certify under
penalty of perjury that the foregoing statement is true and correct:
1. On April 16, 2018, I served the following document(s):
MOTION FOR PARTIAL SUMMARY JUDGMENT ON PLAINTIFFS’ QUIET TITLE/DECLARATORY RELIEF CAUSE OF ACTION
2. I served the above-named document(s) by the following means to the persons as listed below:
(Check all that apply)
[X] a. ECF System (You must attach the “Notice of Electronic Filing”, or list all persons and address and attach additional paper if necessary)
MATTHEW D. FRANCIS on behalf of Cross Defendant JED MARGOLIN
mfrancis@bhfs.com; nlindsley@bhfs.com , rnofederal@bhfs.com
MATTHEW D. FRANCIS on behalf of Defendant JED MARGOLIN
mfrancis@bhfs.com; nlindsley@bhfs.com , rnofederal@bhfs.com
JEFFREY L HARTMAN on behalf of Cross-Claimant PATRICK CANET
notices@bankruptcyreno.com , sji@bankruptcyreno.com
YANXIONG LI on behalf of Counter-Defendant FRED SADRI
yli@wrightlegal.net , nvbkfiling@wrightlegal.net , jcraig@wrightlegal.net; kwightman@wrightlegal.net
YANXIONG LI on behalf of Counter-Defendant RAY KOROGHLI
yli@wrightlegal.net , nvbkfiling@wrightlegal.net , jcraig@wrightlegal.net ; kwightman@wrightlegal.net
YANXIONG LI on behalf of Counter-Defendant SATHSOWI T. KOROGHLI
yli@wrightlegal.net , nvbkfiling@wrightlegal.net , jcraig@wrightlegal.net ; kwightman@wrightlegal.net
YANXIONG LI on behalf of Plaintiff FRED SADRI
yli@wrightlegal.net , nvbkfiling@wrightlegal.net , jcraig@wrightlegal.net ; kwightman@wrightlegal.net
YANXIONG LI on behalf of Plaintiff RAY KOROGHLI
yli@wrightlegal.net , nvbkfiling@wrightlegal.net , jcraig@wrightlegal.net ; kwightman@wrightlegal.net
YANXIONG LI on behalf of Plaintiff SATHSOWI T. KOROGHLI
yli@wrightlegal.net , nvbkfiling@wrightlegal.net , jcraig@wrightlegal.net ; kwightman@wrightlegal.net
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ADAM P MCMILLEN on behalf of Cross Defendant JED MARGOLIN
amcmillen@bhfs.com , nlindsley@bhfs.com
ADAM P MCMILLEN on behalf of Defendant JED MARGOLIN
amcmillen@bhfs.com , nlindsley@bhfs.com
ARTHUR ZORIO on behalf of Cross Defendant JED MARGOLIN
azorio@bhfs.com , RenoIDFilings@bhfs.com
ARTHUR ZORIO on behalf of Defendant JED MARGOLIN
azorio@bhfs.com , RenoIDFilings@bhfs.com
3. On April 16, 2018, I served the above-named document(s) by the following means to the persons as listed below:
¦
b.
JED MARGOLIN JAZI GHOLAMREZA ZANDIAN
c/o Brownstein Hyatt Farber Schreck, LLP 6 RUE EDOUARD FOURNIER
Attn:
Matthew D. Francis, Esq.
Attn: Arthur Zorio, ESq.
STEVE E. ABELMAN on behalf of Creditor Jeffrey L. Hartman, Esq.
JED MARGOLIN HARTMAN & HARTMAN
BROWNSTEIN
HYATT FARBER SCHRECK
4. That such mailing was accomplished by first class mail, pre-paid, in a sealed envelope.
5. I declare under penalty of perjury that the foregoing is true and correct.
I declare under penalty of perjury that the foregoing is true and correct.
Signed on this 16th day of April, 2018.
/s/ Kelli Wightman
An employee of Wright, Finlay & Zak, LLP
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.end