Wells Fargo Bank N.A.'s interest in a Las Vegas property was constitutionally extinguished when a homeowners’ association used a Nevada law to foreclose on the house, the Ninth Circuit ruled Thursday.
The bank argued against allowing a small lien “to wipe out the value of Wells Fargo’s much larger deed of trust,” the appeals court said.
“But that result is no harsher than the result produced by foreclosures to satisfy property-tax liens, which, though sometimes small, can take priority over other interests in the property,” Judge Eric D. Miller wrote for the court.
Wells Fargo didn’t suffer an uncompensated taking...