RH KIDS LLC CALIFORNIA LIMITED LIABILITY COMPANY v. NATIONSTAR MORTGAGE LLC DELAWARE LIMITED LIABILITY COMPANY (2025)

ORDER AFFIRMING IN PART, REVERSING IN PART AND REMANDING

RH Kids, LLC, appeals from a district court order granting a motion to dismiss and dissolving a preliminary injunction in a quiet title action. Eighth Judicial District Court, Clark County; Jacqueline M. Bluth, Judge.

In the operative complaint, RH Kids sued respondent Nationstar Mortgage, LLC, for quiet title, wrongful foreclosure, violation of NRS 107.200 et seq., and declaratory and injunctive relief. RH Kids alleged that it was the owner of the relevant property and that a deed of trust encumbered the property. RH Kids further alleged, among other things, that the deed of trust had been extinguished as a matter of law under NRS 106.240. That statute provides that a lien on real property is conclusively presumed to be discharged “10 years after the debt secured by the mortgage or deed of trust according to the terms thereof or any recorded written extension thereof become[s] wholly due.” NRS 106.240. According to RH Kids, Nationstar's interest in the subject property, as the beneficiary of the deed of trust at the time, was extinguished under NRS 106.240, which was triggered by an acceleration of the underlying debt in 2012. In addition, RH Kids alleged that Nationstar violated NRS 107.200 et seq. because it failed to provide it with information concerning the debt secured by the deed of trust.

Nationstar later filed a motion to dismiss, asserting the facts as alleged were insufficient to state a claim for which relief could be granted. Nationstar contended, among other things, that none of the events discussed by RH Kids triggered NRS 106.240’s ten-year period, and thus NRS 106.240 did not extinguish the deed of trust. Nationstar further asserted that RH Kids failed to produce evidence to support its NRS 107.200 et seq. claim. RH Kids opposed the motion, arguing that it had provided sufficient allegations to state a claim as to each of its causes of action.

Following a hearing, the district court entered an order denying Nationstar's motion with respect to all but RH Kids’ claim for wrongful foreclosure. As relevant here, the district court determined that, because it was required to accept RH Kids’ allegations as true in evaluating Nationstar's motion to dismiss, Nationstar's arguments concerning NRS 106.240 and NRS 107.200 et seq. did not establish a basis for relief.

Nationstar moved for reconsideration of the district court's order partially denying its motion to dismiss. In its motion, Nationstar notified the district court that the Nevada Supreme Court had recently issued a decision in which it explained that NRS 106.240’s ten-year period was triggered by the passing of the maturity date on the face of the deed of trust or a written extension thereof. See LV Debt Collect, LLC v. Bank of N.Y. Mellon, 139 Nev. 232, 238, 534 P.3d 693, 699 (2023). Nationstar accordingly urged the court to reconsider the partial denial of its motion to dismiss and contended that, in light of the supreme court's decision in LV Debt Collect, RH Kids’ NRS 106.240 claims were not viable causes of action. Moreover, Nationstar asserted that the allegations in the operative complaint were insufficient to state a claim for violation of NRS 107.200 et seq.

Over RH Kids’ opposition, the district court entered a written order granting Nationstar's motion for reconsideration, dismissing RH Kids’ remaining claims, and dissolving the preliminary injunction in favor of RH Kids that was entered early in the case. The court ruled the plain language of NRS 106.240 precluded events, such as the ones alleged by RH Kids, from triggering the ten-year period under NRS 106.240.¹ The district court also determined that RH Kids did not state a claim for violation of NRS 107.200 et seq. because it did not sufficiently allege that Nationstar willfully failed to provide information concerning the debt secured by the deed of trust and, regardless, the claim could not be the basis for an injunction. The court also determined that RH Kids was not entitled to relief as to any of its remaining claims. This appeal followed.

On appeal, RH Kids challenges the district court's order granting the motion to dismiss its NRS 106.240 and NRS 107.200 et seq. claims.² We rigorously review a district court order granting an NRCP 12(b)(5) motion to dismiss, accepting all the plaintiff's factual allegations as true and drawing every reasonable inference in the plaintiff's favor to determine whether the allegations are sufficient to state a claim for relief. Buzz Stew, LLC v. City of N. Las Vegas, 124 Nev. 224, 227-28, 181 P.3d 670, 672 (2008). A complaint should be dismissed for failure to state a claim “only if it appears beyond a doubt that [the plaintiff] could prove no set of facts, which, if true, would entitle [the plaintiff] to relief.” Id. at 228, 181 P.3d at 672.

Because Nevada is a notice-pleading jurisdiction, see NRCP 8(a), a complaint need only set forth a short and plain statement with sufficient facts to demonstrate the necessary elements of a claim for relief so that the opposing party “has adequate notice of the nature of the claim and relief sought,” W. States Constr., Inc. v. Michoff, 108 Nev. 931, 936, 840 P.2d 1220, 1223 (1992); see also Droge v. AAAA Two Star Towing, Inc., 136 Nev. 291, 308-09, 468 P.3d 862, 878-79 (Ct. App. 2020) (discussing Nevada's liberal notice pleading standard). “[W]e liberally construe pleadings to place matters into issue which are fairly noticed to the adverse party.” Hall v. SSF, Inc., 112 Nev. 1384, 1391, 930 P.2d 94, 98 (1996) (internal quotation marks omitted).

RH Kids argues the district court erred by dismissing its claims because it contends that the terms of the deed of trust permitted acceleration of the loan, the lender sent the original borrower a notice indicating the acceleration of the loan secured by the deed of trust more than ten years ago and, because the loan was accelerated, the deed of trust that secured that debt became extinguished pursuant to NRS 106.240.³

NRS 106.240, Nevada's ancient-lien statute, provides that a lien created by a mortgage or deed of trust that has not been otherwise satisfied will be presumed discharged ten years after the debt becomes wholly due. A debt becomes “wholly due” according to either (1) the terms in the mortgage or deed of trust, or (2) any recorded, written extension of those terms. LV Debt Collect, 139 Nev. at 236, 534 P.3d at 697; Posner v. U.S. Bank Nat'l Assn, 140 Nev., Adv. Op. 22, 545 P.3d 1150, 1153 (2024). For a deed of trust to be presumed satisfied for the purposes of NRS 106.240, “ten years [must] have passed after the last possible date the deed of trust is in effect, as shown by the maturity date on the face of the deed of trust or any recorded extension thereof.” LV Debt Collect, 139 Nev. at 238, 534 P.3d at 699. The supreme court also explained that, even if a notice provided to the borrower indicating a default in certain circumstances could render a loan wholly due, a notice that declared sums were due and payable but also provided the borrower with the opportunity to cure the default constituted the sort of conflicting language that did not amount to a clear and unequivocal announcement of the lender's intention to declare a debt wholly due. Id. at 238-39, 534 P.3d at 699.

Here, because the terms of the deed of trust did not render the debt wholly due upon the original borrower's default and allowed the opportunity for the borrower to cure the default, NRS 106.240’s ten-year period was not triggered by either the default or any purported lender's letter concerning the default. To the extent RH Kids relies on the acceleration clause contained in the deed of trust and asserts that this clause made the debt wholly due, we are not persuaded by this argument because the borrower retained the option under the deed of trust to reinstate the loan to good standing. See Norman, LLC v. Newrez, LLC, No. 87545, 2024 WL 5086198, at *1 (Nev. Dec. 11, 2024) (Order of Affirmance) (stating that merely defaulting on a loan is insufficient to trigger NRS 106.240); Big Rock Assets Mgmt., LLC v. Newrez, LLC, No. 86675, 2024 WL 4865435, at *2 (Nev. Nov. 21, 2024) (Order of Affirmance) (explaining that “the filing of a notice of default may not automatically accelerate a loan, because NRS 107.080(2)-(3) requires a notice of default to give a borrower thirty-five days to cure, which is antithetical to an acceleration”); RH Kids, LLC v. Specialized Loan Servicing, LLC, No. 87701-COA, 2025 WL 365736, at *3 (Nev. Ct. App. Jan. 31, 2025) (Order of Affirmance) (rejecting appellant's argument that the debt secured by the deed of trust became wholly due more than ten years ago because the terms of the deed of trust permitted acceleration of the loan and a notice was sent indicating acceleration of the loan). Thus, we conclude that, under the language of the deed of trust, neither the default nor the letter could have accelerated the due date on the loan, and thus the ten-year period under NRS 106.240 was not triggered. As a result, RH Kids fails to demonstrate that it is entitled to relief based on this argument, and we therefore affirm the dismissal of RK Kids’ NRS 106.240 claims.

Next, RH Kids contends the district court erred by dismissing its NRS 107.200 et seq. claim because its allegations were sufficient to state a claim for relief. Moreover, RH Kids contends that the district court improperly dismissed this claim on grounds that it did not provide a basis for injunctive relief even though a plaintiff who prevails on this type of claim is statutorily entitled to monetary damages. Nationstar counters that RH Kids’ amended complaint failed to adequately plead its NRS 107.200 et seq. claim.

NRS 107.200 provides that “the beneficiary of a deed of trust ․ shall, within 21 days after receiving a request from a person authorized to make such a request ․ cause to be mailed, postage prepaid or sent by facsimile machine to that person a statement regarding the debt secured by the deed of trust.” NRS 107.300 imposes liability when a lender “willfully fails” to provide certain payoff information as provided in NRS 107.200. When a plaintiff successfully establishes that the beneficiary violated NRS 107.200, the beneficiary is liable to the plaintiff “in the amount of $300 and any actual damages suffered by the person who requested the statement.” NRS 107.300(1).

Here, RH Kids’ amended complaint set forth that it, as the owner of the subject property, made a written request for the statutorily mandated information and statements, that Nationstar received and signed for the written request but did not provide the statutorily enumerated information and statements within the mandated 21-day period from receipt of that request, and that Nationstar's “refusal/failure was willful since there was no just cause for said refusal/failure.” Given the language set forth in the RH Kids’ amended complaint, we conclude that Nationstar was sufficiently apprised regarding the contours of RH Kids’ NRS 107.200 et seq. claim such that the dismissal of this claim for failure to allege sufficient facts was in error. See 8933 Square Knot Tr v. Bank of N. Y. Mellon., No. 87301, 2024 WL 4523905, at *2 (Nev. Oct. 17, 2024 ) (Order Affirming in Part, Reversing in Part, and Remanding) (determining that the operative complaint sufficiently apprised the defendant regarding the contours of appellant's NRS 107.300 claim, such that its claim satisfied NRCP 12(b)(5)’s motion-to-dismiss standard); Harris v. State, 138 Nev. 390, 407, 510 P.3d 802, 807 (2022) (“Under our notice-pleading standard, we liberally construe the pleadings for sufficient facts that put the defending party on adequate notice of the nature of the claim and relief sought.” (internal quotation marks and alteration omitted)); NRCP 8(e) (“Pleadings must be construed so as to do justice.”).

Moreover, because RH Kids sufficiently pled the claim as required by NRCP 8, and a successful plaintiff on this claim would, by statute, be entitled to $300 and any actual damages suffered, see NRS 107.300(1), the district court could not properly dismiss the claim on the basis that it did not support injunctive relief.⁴ Thus, we conclude reversal of the dismissal of the NRS 107.200 et seq. claim and remand for further proceedings is warranted.⁵ Accordingly, we

ORDER the judgment of the district court AFFIRMED IN PART AND REVERSED IN PART AND REMAND this matter to the district court for proceedings consistent with this order.⁶

Bulla, C.J.

Gibbons, J.

Westbrook, J.

FOOTNOTES

1.   As RH Kids referred to the deed of trust in the operative complaint and the terms of the deed of trust were central to its allegations, and no party questioned the authenticity of the deed of trust, which was attached to the motion to dismiss, it was appropriate for the district court to review the deed of trust when granting the motion to dismiss. See Baxter v. Dignity Health, 131 Nev. 759, 764, 357 P.3d 927, 930 (2015) (explaining that when a district court evaluates a motion to dismiss, it can “consider unattached evidence on which the complaint necessarily relies if: (1) the complaint refers to the document; (2) the document is central to the plaintiff's claim; and (3) no party questions the authenticity of the document” (internal quotation marks omitted)).

2.   Because RH Kids does not challenge the dismissal of its remaining claims, it has forfeited any challenge thereto as a result. See Powell v. Liberty Mut. Fire Ins. Co., 127 Nev. 156, 161 n.3, 252 P.3d 668, 672 n.3 (2011) (“Issues not raised in an appellant's opening brief are deemed waived.”).

3.   Insofar as RH Kids contends the district court failed to consider its arguments concerning the effect of the acceleration notice, we conclude any error was harmless for the reasons discussed below. See Wyeth v. Rowatt, 126 Nev. 446, 465, 244 P.3d 765, 778 (2010) (explaining that, to establish an error is prejudicial, “the movant must show that the error affects the party's substantial rights so that, but for the alleged error, a different result might reasonably have been reached”); cf. NRCP 61 (“At every stage of the proceeding, the court must disregard all errors and defects that do not affect any party's substantial rights.”).

4.   We note, however, that NRS 107.300(1) does not entitle RH Kids to any relief from what appears to be Nationstar's now-completed foreclosure sale.

5.   To the extent Nationstar contends that this court cannot reverse and remand RH Kids’ NRS 107.200 et seq. claim, by itself, to the district court because RH Kids is only entitled to recover $300, which falls far below the district court's $15,000 jurisdictional threshold, see Nev. Const. art. 6, § 6(1); see also NRS 4.370(1), Nationstar overlooks that RH Kids is also entitled to recover “any actual damages suffered” as discussed above, and RH Kids alleged it incurred in excess of $15,000 in damages in connection with the claim. See Edwards v. Direct Access, LLC, 121 Nev. 929, 933, 124 P.3d 1158, 1160 (2005) (recognizing that “in order to dismiss a case based on lack of subject matter jurisdiction, it must appear to a legal certainty that the [damages are] worth less than the jurisdictional amount” (alteration in original) (internal quotation marks omitted)).

6.   Insofar as the parties raise arguments that are not specifically addressed in this order, we conclude that they either do not present a basis for relief or need not be addressed.