Claim Under West Virginia Consumer Protection Act Begins To Run The Date The Loan Is Accelerated Not The Date The Loan Matures

The mortgagors and a West Virginia class in _Delebreau v. Bayview Loan Servicing, LLC,_ 6:09-CV-00245 (S.D.W. Va. Jan. 18, 2011) brought an action against their mortgage loan servicer following the servicer’s commencement of a foreclosure alleging the servicer assessed illegal late fees and default fees in violation of the West Virginia Consumer Credit and Protection Act (W. Va.Code §§ 46A-2-128(c)-(d), 46A-3-113 and 46A-2-127(d)). Because the violation arose in connection with a non-revolving consumer loan it is subject to a one year statute of limitations commencing on the ‘due date of the last scheduled payment of the agreement.’ The servicer moved for summary judgment contending that the mortgagor’s claim was time-barred because the ‘last scheduled payment of the agreement’ was the date when the entire balance of the loan became due under the acceleration clause in the loan agreement. When it accelerated the loan it became due immediately. The plaintiffs asserted that the limitation period does not begin to run until the maturity date of the loan, some thirty years later. The court agreed with the servicer concluding that the statutes’ inclusive definition of the term ‘agreement’ encompasses the entire bargain, including the acceleration clause in the loan agreement. This reading was further supported by another section of the statute which provided that there ‘shall be no acceleration of the maturity of all or part of any amount owing in such a consumer credit sale, consumer lease or consumer loan, except where nonperformance specified in the agreement as constituting default has occurred.’ W. Va.Code § 46A-2-106. From this the court deduced that the West Virginia legislature clearly contemplated acceleration of loans as part of the regular course of business in consumer loan transactions. Finally, the court observed that under the plaintiff’s reading an action against a creditor could be brought as many as fifty years after a violation of the Act occurred-even if the plaintiff paid the entire balance of the loan on the first payment-provided that the loan’s maturity date, and thus the last scheduled payment, was fifty years in the future. The court sincerely doubt[ed] that the West Virginia legislature meant to allow plaintiffs a half-century in which to bring claims under the Act.

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