In Re 268 Limited, a Nevada Limited Partnership, Debtor. Joseph F. Sanson Investment Company v. 268 Limited Trustee in Bankruptcy

ORDER CERTIFYING QUESTION OF LAW TO NEVADA SUPREME COURT

QUESTION CERTIFIED TO NEVADA SUPREME COURT

Pursuant to Rule 5 of the Nevada Rules of Appellate Procedure we certify the following question of law to the Nevada Supreme Court:

Does Nevada Revised Statute § 107.030(7) permit parties to a deed of trust to recover stipulated attorney’s fees without regard to the reasonableness of the fee?

FACTS AND PROCEEDINGS BELOW

Joseph Sanson Investment Co. (“San-son”) sold a Las Vegas apartment complex to 268 Limited, a Nevada limited partnership, and retained a security interest in the property, evidenced by a promissory note and first lien deed of trust. The Sanson deed of trust incorporated by reference section 107.030(7) of the Nevada Revised Statutes (NRS) regarding attorney’s fees in the event of default, and designated five percent of the secured amount as the attorney’s fee.

286 Limited’s general partner filed a Chapter 11 petition in bankruptcy, and 286 Limited subsequently defaulted on the obligation to Sanson. The complex was sold, netting a sum substantially in excess of the $3,957,000 that was owed on the note. Sanson was billed $13,732 by its counsel for services related…