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In 2011, the Nevada Legislature passed Assembly Bill 273. AB 273 limited the amount a third party purchaser of secured debt could recover in deficiency actions following foreclosure of real property, among other provisions. Since AB 273′s enactment, numerous cases percolated in Nevada's trial courts, with courts sometimes disagreeing on the interpretation of the law. Until this month, the Nevada Supreme Court had not decided any key issues about AB 273.
That changed last week. In Sandpointe Apartments, LLC v. Eighth Judicial District Court, the Supreme Court finally ruled on arguments about the retroactivity of AB 273′s provisions concerns deficiency judgments. The Court held that the limitations on the amounts third parties who purchased secured debts could recover following foreclosures applied only to sales, either judicial foreclosures or trustee's sales, occurring after AB 273′s enactment on June 10, 2011. The Supreme Court's decision settles a long-pending question of whether AB 273′s modification of contract rights would impact pre-AB 273 debts and foreclosures.
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