FILED
NOT FOR PUBLICATION JUL 06 2011
MOLLY C. DWYER, CLERK
UNITED STATES COURT OF APPEALS U .S. C O U R T OF APPE ALS
FOR THE NINTH CIRCUIT
In the Matter of: AUBURN ACE No. 10-35364
HOLDINGS LLC,
D.C. No. 2:09-cv-00909-RSL
Debtor,
MEMORANDUM *
AUBURN ACE HOLDINGS LLC,
Appellant,
v.
CENTRUM FINANCIAL SVCS INC,
WELLS FARGO BANK NA,
Appellees.
Appeal from the United States District Court
for the Western District of Washington
Robert S. Lasnik, Chief District Judge, Presiding
Argued and Submitted June 9, 2011
Seattle, Washington
Before: REINHARDT, W. FLETCHER, and RAWLINSON, Circuit Judges.
*
This disposition is not appropriate for publication and is not precedent
except as provided by 9th Cir. R. 36-3.
Appellant Auburn Ace Holdings L.L.C. (Auburn Ace) challenges the
bankruptcy court’s grant of summary judgment and dismissal of Auburn Ace’s
quiet title action against Appellee Centrum Financial Services Inc. (Centrum).
Auburn Ace maintains that its president, Ben Errez (Errez), lacked the requisite
authority to enter into a loan agreement with Centrum. The bankruptcy court held
that it was reasonable for Centrum to rely on a written consent providing Errez
with authority to negotiate the terms of any loan without the approval of Auburn
Ace’s board of directors.
The bankruptcy court properly granted summary judgment because there
was no material factual dispute that the written consent and an opinion letter from
Auburn Ace’s corporate attorney bestowed upon Errez, at a minimum, apparent
authority to enter into the loan. See Hoglund v. Meeks, 170 P.3d 37, 44 (Wash.
App. 2007) (“The principal is bound by the act of his agent when he has placed the
agent in such position that persons of ordinary prudence, reasonably conversant
with business usages and customs, are thereby led to believe and assume that the
agent is possessed of certain authority and to deal with him in reliance upon such
assumption.”) (citation and alteration omitted). Because the title insurance
company confirmed Errez’s apparent authority on Centrum’s behalf, Centrum
“actually believe[d] such authority existed.” BP Land & Cattle LLC v. Balcom &
2
Moe, Inc., 86 P.3d 788, 790 (Wash. App. 2004), as amended (citation omitted); see
also W.L. Feely Lumber Co. v. Bookstaver-Burns Lumber Co., 43 P.2d 953, 955
(Wash. 1935) (“The apparent authority, so far as third persons are concerned is the
real authority, and when a third person has ascertained the apparent authority with
which the principal has clothed the agent, he is under no further obligation to
inquire into the agent’s actual authority.”) (citation omitted).1
AFFIRMED.
1
Because the bankruptcy court properly granted summary judgment
premised on Errez’s apparent authority to enter into the loan, we do not address the
parties’ alternative arguments regarding actual authority, the Washington Deed of
Trust Act, election of remedies, ratification of the loan, or equitable subrogation.
3