FILED
NOT FOR PUBLICATION
FEB 18 2016
UNITED STATES COURT OF APPEALS MOLLY C. DWYER, CLERK
U.S. COURT OF APPEALS
FOR THE NINTH CIRCUIT
CUSTOM HOMES BY VIA, LLC, an No. 14-15011
Arizona limited liability company and
NORTHGATE, LLC, an Arizona limited D.C. No. 2:12-cv-01017-FJM
liability company,
Plaintiffs - Appellees, MEMORANDUM*
v.
BANK OF OKLAHOMA, NA, an
Oklahoma corporation,
Defendant - Appellant.
CUSTOM HOMES BY VIA, LLC, an No. 14-15107
Arizona limited liability company and
NORTHGATE, LLC, an Arizona limited D.C. No. 2:12-cv-01017-FJM
liability company,
Plaintiffs - Appellants,
v.
BANK OF OKLAHOMA, NA, an
Oklahoma corporation,
Defendant - Appellee.
*
This disposition is not appropriate for publication and is not precedent
except as provided by 9th Cir. R. 36-3.
CUSTOM HOMES BY VIA, LLC, an No. 14-16209
Arizona limited liability company and
NORTHGATE, LLC, an Arizona limited D.C. No. 2:12-cv-01017-FJM
liability company,
Plaintiffs - Appellees,
v.
BANK OF OKLAHOMA, NA, an
Oklahoma corporation,
Defendant - Appellant.
Appeal from the United States District Court
for the District of Arizona
Frederick J. Martone, Senior District Judge, Presiding
Argued and Submitted February 11, 2016
San Francisco, California
Before: SILVERMAN, FISHER, and TALLMAN, Circuit Judges.
Defendant Bank of Oklahoma, N.A. (“Bank”) appeals and Plaintiffs Custom
Homes by Via, LLC (“Custom Homes”) and Northgate, LLC (“Northgate”) cross-
appeal, from the judgment following a bench trial in this diversity action involving
a loan agreement. We have jurisdiction under 28 U.S.C. § 1291. We affirm.
1. The Bank first challenges the district court’s order granting Custom
Homes’s motion, made in the middle of the bench trial, to add Northgate as a
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plaintiff. We review for an abuse of discretion. See Rush v. Sport Chalet, Inc., 779
F.3d 973, 974 (9th Cir. 2015). Federal Rule of Civil Procedure 21 expressly
provides that a district court may “at any time” add or drop a party. See Fed. R.
Civ. P. 21. Given the relationship between the Plaintiffs, the identity of their
claims, and the lack of any cognizable prejudice to the Bank, the district court did
not abuse its discretion in adding Northgate as a plaintiff. See Pan Am. World
Airways, Inc. v. U.S. Dist. Ct. for Cent. Dist. of Calif., 523 F.2d 1073, 1079-80 (9th
Cir. 1975) (applying Federal Rule of Civil Procedure 20’s substantive standard in
the context of Rule 21).
2. The Bank next challenges the district court’s factual finding that the
Bank’s breach of the loan agreement was a substantial contributing factor to
Plaintiffs’ damages. We review a district court’s factual findings following a
bench trial for clear error. See Oberson v. U.S. Dep’t of Agric., 514 F.3d 989, 1000
(9th Cir. 2008) (“We review a district court’s findings of both cause-in-fact and
proximate cause for clear error.”). The district court did not clearly err in finding
that the Bank’s breach of the loan agreement was a substantial contributing factor
in the Plaintiffs losing the Enclave development and, as a result of that loss, losing
their collateral property.
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3. The Bank argues that the district court erred in (1) failing to offset the
Plaintiffs’ damages award by their loan obligation to the Bank and (2) including
the loan fees and interest paid by Plaintiffs under the loan agreement in the
damages award. The district court did not err in declining the Bank’s request for
an offset because the Bank’s failure to fully perform under the loan agreement
rendered the funds it had disbursed to Plaintiffs worthless. The loan fees and
interest paid by Plaintiffs under the loan agreement were properly included in the
damages award as Plaintiffs sought reliance damages. See Restatement (Second)
of Contracts § 344(b) (defining a party’s reliance interest as the “interest in being
reimbursed for loss caused by reliance on the contract by being put in as good a
position as he would have been in had the contract not been made”).
4. Finally, the Bank argues that the district court erred by awarding
Plaintiffs prejudgment interest. We review the district court’s decision to award
prejudgment interest under state law for an abuse of discretion. Champion
Produce, Inc. v. Ruby Robinson Co., Inc., 342 F.3d 1016, 1020 (9th Cir. 2003).
The district court did not abuse its discretion in awarding Plaintiffs prejudgment
interest as the Plaintiffs were entitled to such interest under Arizona law as a matter
of right. See Precision Heavy Haul, Inc. v. Trail King Indus., Inc., 228 P.3d 895,
896 (Ariz. Ct. App. 2010) (under Arizona law a “party with a liquidated claim is
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entitled to prejudgment interest as a matter of right”); see also John C. Lincoln
Hosp. & Health Corp. v. Maricopa Cty., 96 P.3d 530, 542 (Ariz. Ct. App. 2004)
(“A claim is liquidated if the plaintiff provides a basis for precisely calculating the
amounts owed.”).
5. In their cross-appeal, the Plaintiffs contend that the district court erred
in granting the Bank summary judgment on their wrongful foreclosure claim. We
review de novo. See Jesinger v. Nevada Fed. Credit Union, 24 F.3d 1127, 1130
(9th Cir. 1994). The district court properly granted the Bank summary judgment as
to the Plaintiffs’ wrongful foreclosure claim because Plaintiffs failed to obtain an
injunction preventing the trustee’s sale. See A.R.S. § 33-811(C); see also Morgan
AZ Fin., LLC v. Gotses, 326 P.3d 288, 290-91 (Ariz. Ct. App. 2014) (“[A] trustor
who fails to enjoin a trustee’s sale waives his claims to title of the property upon
the sale’s completion . . . and also waives any claims that are dependent on the
sale.”).
We deny both parties’ requests under A.R.S. § 12-341.01 for attorney’s fees
on appeal because success on appeal was shared. See Huey v. Honeywell, Inc., 82
F.3d 327, 334 (9th Cir. 1996). The parties shall bear their own costs on appeal.
AFFIRMED.
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