Las Vegas Sun

May 25, 2015

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Las Vegas judge blocks foreclosure by HOA collection agency

A judge in Las Vegas on Thursday issued a temporary restraining order blocking today's planned foreclosure of a home by a collection agency for a homeowner association.

Clark County District Court Judge Jessie Walsh issued the order after yet another homeowner sued the collection agency, Nevada Association Services.

Nevada Association Services (NAS) is at the center of legal and political battles over how much homeowners -- and investors in foreclosed homes -- should be required to pay for past-due HOA assessments, fines, fees and collection costs.

Several lawsuits are pending involving NAS and other collection agencies including a proposed class-action case in federal court in Las Vegas claiming NAS has violated the federal Fair Debt Collection Practices Act and other counts.

The suit claims Nevada Association Services has been demanding collection fees and costs that were never authorized by homeowner associations, never incurred by HOAs and never agreed to by homeowners in community covenants, conditions and restrictions (CC&Rs).

Attorneys for NAS have denied those allegations and NAS says its collection activities are necessary to help homeowner associations meet budgetary needs at a time when those budgets have been squeezed by the glut of foreclosures in Southern Nevada.

Walsh on Thursday issued the temporary restraining order at the request of attorneys for Beatrice Management Group Inc., which says it owns a home at 7413 Midnight Rambler.

"The court finds that a foreclosure sale of the subject property would constitute irreparable harm according to the Nevada law that finds that real property is unique and a forced sale contrary to law would thereby constitute irreparable harm," the order blocking the foreclosure said. The order may remain in place until an April 12 preliminary injunction hearing.

Beatrice, in a lawsuit against NAS, said the foreclosure sale shouldn't proceed until the court has a chance to rule on what Beatrice calls "illegal charges, demands and fees being asserted by NAS in order to intimidate Beatrice into paying whatever unlimited and unfettered amount NAS claims in order to avoid foreclosure."

Beatrice charged in its lawsuit that NAS claims Beatrice owes the Terra Bella Homeowners Association $2,923 in unpaid monthly assessments -- when, according to Beatrice, it made seven payments to the HOA but those payments were returned to Beatrice's bank.

"More importantly, NAS now inexplicably claims Beatrice must pay $7,505 in order to avoid a foreclosure sale," the lawsuit charges.

"NAS has no authority, contractual or statutorily, to support or authorize the addition of nearly $5,000 in 'fees' and 'penalties' in order to avoid the foreclosure of the residence," charges the suit filed by attorney James Rosenberger of the Las Vegas law firm Pico Rosenberger.

The complaint added "NAS has refused to compromise or even discuss a compromise regarding the illegal and unlawful charges and demands they are making."

David Stone, owner of NAS, said today that temporary restraining orders are not unusual and don't reflect on the merits of the collection action.

"We're going to fight this and Beatrice will be paying my attorney's fees," Stone said, adding that the homeowner association has seen tenants come and go from the property at issue and "this isn't a sympathetic plaintiff."

With the Legislature looking at reigning in HOA collection fees, Stone said his fees haven't changed in six or seven years and that all that's changed is that there seems to be growing sympathy for those "trying to avoid their contractual obligations."

Separately, Las Vegas attorney and investor Puoy Premsrirut has responded to allegations leveled against her this month in a lawsuit filed by NAS and other collection agencies.

That suit claims Premsrirut and her brother Rutt Premsrirut, also an investor in foreclosed homes, have been abusing the legal system and intimidating homeowner associations in hopes of avoid paying legitimate costs.

But Premsrirut, who regularly litigates against collection agencies, said in a statement to the Las Vegas Sun: "In a retaliatory move, the debt collectors now attempt to silence the voice of the attorney and her brother by filing an `abuse of process' claim against them. Puoy and Rutt now ask, `When is it an abuse of process to demand due process?"'

Commenting on the class-action lawsuit filed by she and attorney James Adams against NAS, Premsrirut said that "Instead of meeting these allegations head on and defending his collection practices, NAS owner David Stone has apparently vowed to spend millions of dollars gained from his dubious collection scheme to crush Puoy's attempt to hold him accountable. On behalf of Nevada homeowners everywhere, Puoy has vowed to fight back!"

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