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Domesticating Foreign Judgments in Nevada Under NRS 17.350. When to Record

Posted by: on Fri, Oct 16, 2015

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MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF PLAINTIFFS’ OPPOSITION TO DEFENDANT ALESSI’S MOTION TO REMOVE JUDGMENT LIEN
Plaintiffs and Judgment Creditors 3405/3407 SLAUSON AVENUE, LLC, a California limited liability company; DAVID BEN ELIYAHU, an individual; ABRAHAM BEN ELIYAHU, an individual (“Judgment Creditors”) hereby oppose Judgment Debtor David A. Alessi’s Motion to Remove Judgment Lien (“Motion”) on the basis of the following points and authorities.
I. ALESSI’S CLAIM THAT ONLY NEVADA DISTRICT COURT JUDGMENTS AND FEDERAL COURT JUDGMENTS CAN BE RECORDED TO CREATE JUDGMENT LIENS ON NEVADA REAL PROPERTY IS PATENTLY FALSE.
In his Motion, Alessi repeatedly makes the utterly false assertion that only those judgments which are issued by Nevada District Courts and by United States Federal Courts may be recorded to created judgment liens under the provisions of NRS 17.150. See Alessi’s Motion at page 5, lines 17-19; and page 6, lines 2-5. On the basis of this false assertion, Alessi claims that the judgment recording procedure codified in NRS 17.150 does not apply to Plaintiffs’ domesticated California foreign judgment.
Alessi’s argument has no merit because it completely ignores the provisions of NRS 17.350 which expressly provides that:
An exemplified copy of any foreign judgment may be filed with the clerk of any district court of this state. The clerk shall treat the foreign judgment in the same manner as a judgment of the district court of this state. A judgment so filed has the same effect and is subject to the same procedures, defenses and proceedings for reopening, vacating or staying as a judgment of a district court of this state and may be enforced or satisfied in like manner. (Emphasis added.)

By operation of NRS 17.350, Plaintiffs’ domesticated California Judgment, which was filed in strict compliance with all of the provisions of Nevada’s Uniform Enforcement of Foreign Judgments Act (“UEFJA”) (see accompanying Affidavit of G. Mark Albright), “has the same effect and is subject to the same procedures and proceedings as a judgment of a Nevada district court.”
Obviously, one such “procedure and proceeding” which is made available by NRS 17.350 to Plaintiffs as the holder of their domesticated California Judgment is the “procedure and proceeding” codified in NRS 17.150, which expressly authorizes the creation of judgment liens on judgment debtors’ Nevada real property by means of recording a certified copy of the judgment with the County Recorder’s Office. As confirmed by Mr. Albright’s Affidavit and the exhibits thereto, and by this Court’s own docket, this is precisely what Plaintiffs did in this case as is their right under NRS 17.350 and NRS 17.150.
Alessi’s assertion that Plaintiffs were unauthorized to record their domesticated foreign judgment flies in the face of the express authorization provided to the holders of domesticated foreign judgments by NRS 17.350. Accordingly, Alessi’s unfounded claim the judgment lien creation provisions of NRS 17.150 apply exclusive to Nevada District Court and Federal Court judgments, and not to domesticated foreign judgments, is patently wrong and must be rejected by this Court.
II. THERE IS NO MERIT TO ALESSI’S ASSERTION THAT THE RECORDATION OF A FOREIGN JUDGMENT UNDER NRS 17.150 AND NRS 17.350 IS SUBJECT TO ANY “THIRTY-DAY WAITING PERIOD.”
In his Motion, Alessi also makes the false claim that NRS 17.360(3), which provides that “no execution or other process for enforcement of a foreign judgment may issue until 30 days after the mailing of the notice of filing,” applied to bar Plaintiffs from recording their domesticated foreign judgment within the 30 days period after they mailed their notice of filing. Alessi is plainly wrong on this point also because the law is clear that the creation of a judgment lien by recording a judgment does not constitute “execution or enforcement of a judgment,” nor does it involve the issuance of any process by any court.
See Industrial Indemnity Co. v. Levine, 49 Cal. App. 3d 698:
“Appellant contends that a stipulated stay of execution does not preclude recordation of an abstract of judgment, because such recordation is not a step in the process of execution upon the judgment. That contention is sound. A money judgment may be enforced by a writ of execution (Code Civ. Proc., §§ 681, 684); such enforcement requires no recordation of the abstract of judgment to reach a real property interest (Code Civ. Proc., § 688). Recordation of an abstract of judgment merely creates a lien upon real property of the judgment debtor (Code Civ. Proc., § 674); such recordation is not an execution upon a judgment. (Menges v. Robinson (1933) 132 Cal. App. 647, 652 [23 P.2d 526]; Laubisch v. Roberdo (1954) 43 Cal.2d 702, 707 [277 P.2d 9].)”

The above-quoted rule of Industrial Indemnity was relied upon by the Utah Court of Appeals in Beehive Bail Bonds v. District Court. 933 P.2d 1011, 1012-13 (Utah Ct.App.1997). In that case, appellant Beehive, the issuer of a bail bond contended that the district court did not wait the statutory time period before collecting or executing on the bail, based on a Utah statute which provided that “execution on a judgment upon the bail may not issue in less than 90 days after the completion of the mailing or service of a notice of entry of judgment upon the surety.”
Beehive argued that section 77-20a-2 of the Bail Forfeiture Procedure Act prohibits the court from filing the abstracted judgments before ninety days elapsed from notice of entry of judgment upon the bail, claiming that filing an abstract of judgment, which creates a lien on the judgment debtor’s property, see Utah Code Ann. § 78-22-1 (1996), is tantamount to execution before the statutory ninety-day period elapses. Relying on Industrial Indemnity’s holding, the Utah Court of Appeals rejected Beehive’s argument as follows:
We disagree. “Recording a judgment is not the same as execution on a judgment.” Kiker v. National Structures, Inc., 342 So.2d 746, 748 (Ala.1977). “Recordation of an abstract of judgment merely creates a lien upon real property of the judgment debtor … such recordation is not an execution upon a judgment.” Industrial Indem. Co. v. Levine, 49 Cal.App.3d 698, 122 Cal.Rptr. 712, 713 (1975). Filing an abstract of judgment, therefore, does not constitute execution on a judgment.

See also In re Benjamin E. Vanden Bossche, 125 B.R. 571(the recording of an abstract of judgment does not violate the automatic stay in bankruptcy because it does not constitute the “enforcement of a judgment.”
As explained herein, and in the accompanying Affidavit of G. Mark Albright, the domestication of Plaintiffs’ California Judgment in Nevada and the recording of that domesticated judgment did no more than create a judgment lien against Alessi’s real property in Clark County. Under the above-quoted cases, the act of creating a judgment lien by recording a judgment is not “the execution of a judgment” or “the enforcement of a judgment” and such recording does not require or involve the issuance of any court process. Accordingly, the 30 day waiting period on “the execution and enforcement” of domesticated foreign judgments contained in NRS 17.360(3) has no application to Plaintiffs’ recordation of their domesticated California Judgment in Clark County.
III. THE POST-RECORDING ISSUANCE OF COURT ORDERS IN CALIFORNIA AND NEVADA STAYING EXECUTION ON PLAINTIFFS’ JUDGMENT DURING THE PENDENCY OF ALESSI’S APPEAL HAS NO EFFECT ON THE CONTINUING VALIDITY OF PLAINTIFF’S PREVIOUSLY CREATED JUDGMENT LIEN ON ALESSI’S REAL PROPERTY.
Alessi’s Motion assumes, but does not establish by any citation to binding legal authority, that when he posted a cash appeal bond in the California action on April 8, 2014, that posting somehow magically caused Plaintiffs’ previously created judgment lien on his real property to automatically vanish. Alessi is once again wrong on the law.
The weight of authority holds that judgment debtors are not entitled to a retroactive removal of a lien merely because they posted a supersedeas (or cash) appeal bond. See e.g., Ribbens Int’l, S.A. de C.V. v. Transp. Int’l Pool, Inc., 40 F. Supp. 2d 1141, 1145 (C.D. Cal. 1999); Moses v. K-Mart Corp., 922 F. Supp. 600, 605 (S.D. Fla. 1996), aff’d in part and rev’d in part, 136 F.3d 140 (11th Cir. 1998); Johns v. Rozet, 143 F.R.D. 11, 12–13 (D.D.C. 1992); State Bank of Spring Hill v. Bucyrus Grain Co. (In re Bucyrus Grain Co.), 127 B.R. 52, 55 (D. Kan. 1991); Secure Eng’g Servs., Ltd. v. Int’l Tech. Corp., 727 F. Supp. 261, 264–65 (E.D. Va. 1989); Larry Santos Prods. v. Joss Org., 682 F. Supp. 905, 906 (E.D. Mich. 1988).
Furthermore, in the legal context of the domestication of foreign judgments, the likelihood that the foreign court will permit a retroactive stay and extinguish liens or levies in its jurisdiction is slim, given that it did not impose the judgment, and given its obligation under the United States Constitution to “give full faith and credit” to sister state judgments. See, e.g., Laborers Nat’l Pension Fund v. ANB Inv. Mgmt. & Trust Co., 26 F. Supp. 2d 1048, 1051 (N.D. Ill. 1998), in which the plaintiffs received a favorable judgment in Texas district court, and the defendant did not initially post a bond to stay the enforcement. Id. at 1049. After the plaintiffs registered their judgment in Illinois and commenced proceedings to discover the defendant’s assets, the defendants posted a bond with the Texas court, and asked it to stay the pending Illinois asset discovery. Id. The Texas court granted the stay, but left the issue of the citations up to the Illinois district court. Id. at 1050. The Illinois court ruled that the bond did not apply retroactively to stop plaintiffs’ antecedent supplementary asset discovery proceedings. Id. at 1051.
So too here. In this case it was not until April 8, 2014, nearly six months after Plaintiffs properly domesticated their California Judgment and properly recorded it with the Clark County Recorder, that Alessi posted his cash bond with the Los Angeles Superior Court. The stay of execution in California arising from the posting of Alessi’s bond had no retroactive effect on the judgment lien that Plaintiffs had obtained when they recorded their California Judgment in Clark County, Nevada.
Nevada statutory law confirms the conclusions. As explained in greater detail in the Affidavit of G. Mark Albright, by enacting NRS 17.370, Nevada’s legislature has specifically legislated in the context of domesticated foreign judgments that the sole legal consequence of posting of an appeal bond is to stay enforcement of such domesticated judgments during the pendency of the appeal. Nothing in NRS 17.370 directs or permits the removal of judgment liens that recorded and attached to the judgment debtor’s real property before such posting occurred. In other words, the subsequent posting of an appeal bond has no retroactive effect on pre-existing recorded judgment liens.
As Mr. Albright explained to Mr. Alessi in his email dated September 4, 2015 (attached as Exhibit “A” to Mr. Albright’s supporting Affidavit):
We appreciate the fact that you have appealed (the first notice of appeal was March 18, 2014) from that judgment in California and have apparently made a cash deposit (on April 9 [8][sic], 2014) in lieu of posting a supersedeas bond in the California action. However, posting a supersedeas bond (or posting a cash deposit) under NRCP 62(d) and NRS 17.370 merely provides a stay of execution of the judgment appealed from but does not release that judgment, or the judgment lien created by its recording. NRS 17.370, entitled ”Stay of enforcement of foreign judgment,” expressly provides that: “If the judgment debtor shows the court that an appeal from the foreign judgment is pending or will be taken, or that a stay of execution has been granted, the court shall stay enforcement of the foreign judgment until the appeal is concluded, the time for appeal expires or the stay of execution expires or is vacated, upon proof that the judgment debtor has furnished the security for the satisfaction of the judgment required by the state in which it was rendered.

Thus, in Nevada, filing a bond or posting cash to obtain a stay pending appeal does not terminate or discharge a valid judgment lien recorded upon the real estate of the judgment debtor, but merely stays execution thereon during the appeal.
For all these reasons, there is no merit to Alessi’s assertion that Plaintiffs’ pre-existing judgment lien must be removed because of the subsequent posting of his appeal deposit in the California action.
IV. PLAINTIFFS AND THEIR COUNSEL HAVE FOLLOWED THE LAW, ALL OF THEIR ACTIONS ARE JUSTIFIED BY THE FACTS, AND HAVE ACTED REASONABLY AT ALL TIMES. ALLESI’S SANCTIONS REQUEST MUST BE DENIED.
By reason of the foregoing facts and evidence, it is clear that there is no merit to Alessi’s Motion and no basis in law or in fact for removing Plaintiffs’ judgment lien from Alessi’s real property. For all the same reasons, it is equally clear that Plaintiffs and their counsel have at all times acted in full conformity with Nevada law, with full factual justification and therefore reasonably. Accordingly, there is no merit to Alessi’s request for an award of monetary sanctions and the same should be denied in its entirety.
Furthermore, Nevada follows the “American Rule” that attorney fees may not be awarded absent a statute, rule, or contract authorizing such award. Under the “American Rule” each party bears their own attorney’s fees unless there is a contract between them which provides for the recovery of attorney’s fees, or a statute provides for the recovery of attorney’s fees. See Bobby Berosini, Ltd. v. PETA, 114 Nev. 1348, 1356, 971 P.2d 383, 388 (1998); Consumers League v. Southwest Gas, 94 Nev. 153, 156, 576 P.2d 737, 738 (1978).
Alessi’s Motion cites to no contract or statute which would authorize the award of any attorney’s fees to Alessi in connection with his Motion. Although not cited by Alessi, there is one Nevada statute, NRS 18.010(2), which provides:
“In addition to the cases where an allowance is authorized by specific statute, the court may make an allowance of attorney’s fees to a prevailing party: . . .

(b) Without regard to the recovery sought, when the court finds that the claim… was brought without reasonable ground or to harass the prevailing party.”

See Allianz Ins. Co. v. Gagnon, 109 Nev. 990, 996, 860 P.2d 720, 724 (1993), (for purposes of an award of attorney’s fees pursuant to NRS 18.010(2)(b), “[a] claim is groundless if `the allegations in the complaint … are not supported by any credible evidence at trial.'” (quoting Western United Realty, Inc. v. Isaacs, 679 P.2d 1063, 1069 (Colo.1984)); and Barozzi v. Benna, 112 Nev. 635, 639, 918 P.2d 301, 303 (1996), (no award of fees under NRS 18.010(2)(b) unless an action is frivolous.)
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[continued on Page 8] CONCLUSION
For all the reasons stated herein, NRS 18.010(2)(b) has no application here because, as noted, Plaintiffs and their counsel have acted at all times in conformity with the law, based upon substantial factual support, and reasonably, and there good faith efforts to secure their California Judgment are certainly not frivolous, and the Motion to Remove Judgment Lien should be summarily denied.
DATED this _____ day of October, 2015.
ALBRIGHT, STODDARD, WARNICK
& ALBRIGHT

By_______________________________
G. MARK ALBRIGHT, ESQ.
Nevada Bar No. 001394
801 South Rancho Drive, Suite D-4
Las Vegas, Nevada 89106
Attorneys for Plaintiffs

CERTIFICATE OF SERVICE

I certify that I am an employee of Albright, Stoddard, Warnick & Albright, and that on the 18th day of September, 2015, I served a true and correct copy of the foregoing PLAINTIFFS AND JUDGMENT CREDITORS’ OPPOSITION TO DEFENDANT AND JUDGMENT DEBTOR DAVID A. ALESSI’S MOTION TO REMOVE JUDGMENT LIEN; AFFIDAVIT OF G. MARK ALBRIGHT; DECLARATION OF JACOB N. SEGURA; AND MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF OPPOSITION upon all counsel of record by electronically serving the document using the Court’s electronic filing system, which will cause this document to be served upon the following counsel of record:
Steven T. Loizzi, Jr., Esq
Alessi & Koenig, LLC
Suite 25
9500 West Flamingo Road
Las Vegas, Nevada 89147

 

____________________________________
An employee of Albright, Stoddard,
Warnick & Albright

 

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