James R. and Jamila J. Fleet v. Webber Springs Owners Assoc. , 235 W. Va. 184 ( 2015 )

IN THE SUPREME COURT OF APPEALS OF WEST VIRGINIA
January 2015 Term
FILED
April 23, 2015
released at 3:00 p.m.
RORY L. PERRY II, CLERK
No. 14-0637 SUPREME COURT OF APPEALS
OF WEST VIRGINIA
JAMES R. FLEET, JAMILA J. FLEET, AND JAMES LAMPLEY,
Defendants Below, Petitioners
V.
WEBBER SPRINGS OWNERS ASSOCIATION, INC.,
Plaintiff Below, Respondent
Appeal from the Circuit Court of Berkeley County
Honorable John C. Yoder, Judge
Civil Action No. 11-C-1091
AFFIRMED, IN PART; REVERSED, IN PART; AND REMANDED
Submitted: April 7, 2015
Filed: April 23, 2015
Stephen G. Skinner Susan R. Snowden
Anthony J. Delligatti Jason S. Murphy
Skinner Law Firm Martin & Seibert, L.C.
Charles Town, West Virginia Martinsburg, West Virginia
Attorneys for the Petitioners Tammy Mitchell McWilliams
Trump & Trump, L.C.
Christopher J. Regan Martinsburg, West Virginia
Jason E. Causey Attorneys for the Respondent
Bordas & Bordas, PLLC
Wheeling, West Virginia
Anthony J. Majestro
Powell & Majestro, PLLC
Charleston, West Virginia
Attorneys for Amicus Curiae,
West Virginia Association for Justice
JUSTICE DAVIS delivered the Opinion of the Court.
JUSTICE BENJAMIN dissents and reserves the right to file a dissenting opinion.
JUSTICE LOUGHRY concurs and reserves the right to file a concurring opinion.
SYLLABUS BY THE COURT
1. Pursuant to W. Va. Code § 38-16-202(a) (1999) (Repl. Vol. 2011) and
W. Va. Code § 38-16-201 (1999) (Repl. Vol. 2011), which must be read and applied
together, consensual common law liens against real property are valid and enforceable in
West Virginia.
2. Homeowners association assessments that are to be used for improving
and/or maintaining common areas of a planned community, including, but not limited to,
maintaining common roads and common recreational areas within the community, are an
obligation primarily for personal, family, or household purposes, and, therefore, such
assessments are “claims” pursuant to W. Va. Code § 46A-2-122(b) (1996) (Repl. Vol. 2006).
i
Davis, Justice:
This case involves a dispute between a homeowners association that is a West
Virginia Limited Expense Planned Community under W. Va. Code § 36B-1-203 (1994)
(Repl. Vol. 2011) and certain homeowners who have failed to pay their association
assessments. The parties disagree over the ability of a West Virginia Limited Expense
Planned Community to assert a common law lien on real property for unpaid association
assessments, attorney’s fees, and costs. In addition, we are asked to decide whether an
association’s attempts to collect delinquent assessments are governed by the West Virginia
Consumer Credit and Protection Act. The homeowners herein appeal the circuit court’s grant
of summary judgment resolving these issues in favor of the homeowners association. We
conclude that W. Va. Code § 38-16-202(a) (1999) (Repl. Vol. 2011) and W. Va. Code
§ 38-16-201 (1999) (Repl. Vol. 2011) authorize a consensual common law lien against real
property and that the unfair debt collection provisions of the West Virginia Consumer Credit
and Protection Act do apply to a homeowners association’s attempts to collect delinquent
assessments. Accordingly, we affirm, in part; reverse, in part; and remand this case for
further proceedings consistent with this opinion.1
1
This Court acknowledges the appearance of the West Virginia Association for
Justice as Amicus Curiae in support of the homeowners’ position that the West Virginia
Consumer Credit and Protection Act applies in this case. We appreciate the appearance of
Amicus Curiae and will consider its arguments in conjunction with those of the homeowners.
1
I.
FACTUAL AND PROCEDURAL HISTORY
Webber Springs Owners Association, Inc. (“Webber Springs”), plaintiff below
and respondent herein, has elected to be a West Virginia Limited Expense Liability Planned
Community (“LELPC”). In November 2003, the developer and declarant2 of Webber
Springs recorded in the Berkeley County, West Virginia, land records, its declaration3 of
conditions, covenants, restrictions, and easements for the planned community. Because
Webber Springs declared itself to be an LELPC pursuant to W. Va. Code § 36B-1-203,4 it
2
Pursuant to W. Va. Code § 36B-1-103(12) (1998) (Repl. Vol. 2011),
“‘[d]eclarant’ means any person or group of persons acting in concert who: (i) As part of a
common promotional plan, offers to dispose of his or its interest in a unit not previously
disposed of; or (ii) reserves or succeeds to any special declarant right.” The term “unit” is
defined, in part, as “a physical portion of the common interest community designated for
separate ownership or occupancy, the boundaries of which are described pursuant to
subdivision (5), subsection (a), section one hundred five [§ 36B-2-105], article two of this
chapter.” W. Va. Code § 36B-1-103(33).
3
Pursuant to W. Va. Code § 36B-1-103(13), the term “declaration” means
“instruments, however denominated, that create a common interest community, including any
amendments to those instruments.”
4
W. Va. Code § 36B-1-203 (1994) (Repl. Vol. 2011) states:
If a planned community:
(1) Contains no more than twelve units and is not subject
to any development rights; or
(2) Provides, in its declaration, that the annual average
common expense liability of all units restricted to residential
purposes, exclusive of optional user fees and any insurance
premiums paid by the association, may not exceed three hundred
dollars as adjusted pursuant to section 1-114 [§ 36B-1-114]
(continued...)
2
is exempt from all but a few specified provisions of the Uniform Common Interest
Ownership Act, and its assessments5 are capped in accordance with W. Va. Code § 36B-1­
203. The declaration recorded by Webber Springs provides that delinquent unpaid
assessments are both liens against the real estate and the personal obligation of the owner.
The parties do not dispute that Webber Springs has the right to assess and
collect certain fees and homeowners association assessments. Rather, the instant conflict
revolves around Webber Springs ability to place a lien on the real property of Webber
Springs homeowners whose dues are delinquent.
Mr. James Lampley (“Mr. Lampley”) acquired title to real property within
Webber Springs by deed dated February 25, 2005. The deed expressly provides that the
conveyance is subject to “all those reservations, restrictions, easements and other matters of
record . . . .” Similarly, James R. Fleet and Jamila J. Fleet (“the Fleets”) acquired title to real
4
(...continued)
(adjustment of dollar amounts) it is subject only to sections
1-105 [§ 36B-1-105] (separate titles and taxation), 1-106 [36B­
1-106] (applicability of local ordinances, regulations and
building codes) and 1-107 [36B-1-107] (eminent domain),
unless the declaration provides that this entire chapter is
applicable.
5
By the term “assessments,” we refer to “common expense liability,” which
“means the liability for common expenses allocated to each unit” of a planned community.
W. Va. Code § 36B-1-103(6).
3
property within Webber Springs by deed dated May 6, 2005. Their deed expressly provides
that the conveyance is subject to “all rights, ways, utility line easements and restrictive
covenants of record.” In addition, Mr. Lampley and the Fleets signed a document titled
“Planned Unity Development Rider” in which they agreed to promptly pay, when due, all
homeowners’ dues and assessments. Mr. Lampley and the Fleets (collectively, “the
Homeowners”) are the defendants below and petitioners herein.
It is undisputed that Mr. Lampley failed to pay his annual homeowners
assessments for the years 2007 through 2011. Likewise, it is undisputed that the Fleets failed
to pay their annual homeowners assessments for the years 2006 through 2011. As a
consequence, Webber Springs recorded, in the Berkeley County Clerk’s office, “notices of
liens” purporting to create liens for the unpaid assessments, attorney’s fees, and costs, on the
real property owned by the Homeowners.6
On January 3, 2012, Webber Springs filed separate complaints against the
Homeowners. The Homeowners responded by filing separate answers and counterclaims
against Webber Springs asserting violations of the West Virginia Consumer Credit and
6
On February 27, 2008, and January 8, 2010, Webber Springs recorded notices
of liens against the Fleet property. On March 10, 2008, and January 8, 2010, Webber Springs
recorded notices of liens against Mr. Lampley’s property.
4
Protection Act. The Homeowners then filed a combined motion to file an amended answer
to include class action claims7 and to consolidate their cases. The circuit court granted the
Homeowners’ motion to consolidate their cases.
Thereafter, Webber Springs moved for summary judgment on the
counterclaims asserted by the Homeowners. By order entered April 25, 2014, the Circuit
Court of Berkeley County granted partial summary judgment in favor of Webber Springs as
to all of the Homeowners’ counterclaims. This appeal followed.
II.
STANDARD OF REVIEW
The instant matter is before this Court on appeal from an order granting partial
summary judgment in favor of Webber Springs.8 Accordingly, our review is de novo. “A
7
The Homeowners assert that, since 2003, Webber Springs has filed at least one
hundred eleven notices of liens against homeowners in Berkeley County and, in many
instances, has recorded judgments pursuant to the purported liens. By order entered May 1,
2014, the circuit court denied the Homeowners’ motion to certify a class action. The circuit
court explained that its order granting summary judgment in favor of Webber Springs
rendered the motion moot.
8
As a preliminary matter, we note that Webber Springs has complained that the
circuit court’s order granting partial summary judgment in its favor is interlocutory, and,
because the order fails to expressly include language prescribed by Rule 54(b) of the West
Virginia Rules of Civil Procedure, this appeal violates the rule of finality. See Credit
Acceptance Corp. v. Front, 231 W. Va. 518, 522, 745 S.E.2d 556, 560 (2013) (“Typically,
interlocutory orders are not subject to this Court’s appellate jurisdiction.”); Coleman v.
(continued...)
5
circuit court’s entry of summary judgment is reviewed de novo.” Syl. pt. 1, Painter v. Peavy,
192 W. Va. 189, 451 S.E.2d 755 (1994). In conducting our de novo review, we are mindful
that “[a] motion for summary judgment should be granted only when it is clear that there is
no genuine issue of fact to be tried and inquiry concerning the facts is not desirable to clarify
the application of the law.” Syl. pt. 3, Aetna Cas. & Sur. Co. v. Federal Ins. Co. of New
York, 148 W. Va. 160, 133 S.E.2d 770 (1963). Finally, to the extent that our resolution of
this matter requires us to consider statutory provisions, our review is likewise de novo.
“Where the issue on an appeal from the circuit court is clearly a question of law or involving
8
(...continued)
Sopher, 194 W. Va. 90, 94, 459 S.E.2d 367, 371 (1995) (“The usual prerequisite for our
appellate jurisdiction is a final judgment, final in respect that it ends the case.”). See also
Franklin D. Cleckley, Robin J. Davis, & Louis J. Palmer, Jr., Litigation Handbook on West
Virginia Rules of Civil Procedure § 54(b), at 1157 (4th ed. 2012) (“As a general matter, to
have Rule 54(b) invoked a trial court must make an express determination that there is no just
reason for delay and make an express direction for entry of judgment.” (footnote omitted)).
Notably, however, this Court has held that “[t]he key to determining if an order is final is not
whether the language from Rule 54(b) of the West Virginia Rules of Civil Procedure is
included in the order, but is whether the order approximates a final order in its nature and
effect. . . .” Syl. pt. 1, in part, State ex rel. McGraw v. Scott Runyan Pontiac-Buick, Inc., 194
W. Va. 770, 461 S.E.2d 516 (1995) (internal citation omitted). See also Syl. pt. 4, Riffe v.
Armstrong, 197 W. Va. 626, 477 S.E.2d 535 (1996) (“Whether an order dismissing fewer
than all of the parties or fewer than all the claims in a civil action, which does not contain the
express determinations set forth in Rule 54(b) of the West Virginia Rules of Civil Procedure,
was intended to be final and is therefore appealable before the entire action is terminated will
be determined by this Court from all the circumstances and the terms of the order. The better
practice for the circuit courts to follow is to expressly state or negate their intentions with
respect to the finality of such an order within the body of the order.”). In this case, the circuit
court’s partial summary judgment order dismissed all of the Homeowners’ counterclaims
against Webber Springs with prejudice. Accordingly, as to those claims, we find the order
“approximates a final order in its nature and effect. . . .” Syl. pt. 1, in part, State ex rel.
McGraw v. Scott Runyan Pontiac-Buick, Inc., 194 W. Va. 770, 461 S.E.2d 516.
6
an interpretation of a statute, we apply a de novo standard of review.” Syl. pt. 1, Chrystal
R.M. v. Charlie A.L., 194 W. Va. 138, 459 S.E.2d 415 (1995). Applying the foregoing
standards, we proceed to address the issues raised.
III.
DISCUSSION
Two issues are raised in this appeal. First, the Homeowners assert that the
circuit court erred by concluding that Webber Springs had valid common law liens against
the Homeowners’ real property. Second, the Homeowners argue that the circuit court erred
by concluding that a homeowners associations’ attempts to collect assessments are not
subject to the West Virginia Consumer Credit and Protection Act. We address each of these
issues in turn.
A. Validity of Webber Springs’ Liens
The Homeowners argue that the liens asserted by Webber Springs are invalid
and unenforceable pursuant to W. Va. Code § 38-16-202(a). In this regard, the Homeowners
contend that the circuit court erred by failing to interpret W. Va. Code § 38-16-202(a) as
completely barring common law liens against real property, regardless of whether such liens
are consensual. Webber Springs, on the other hand, contends that the Homeowners have
misconstrued the statute. We agree.
7
Prior to examining the relevant statutes, we pause to note that “[t]he primary
object in construing a statute is to ascertain and give effect to the intent of the Legislature.”
Syl. pt. 1, Smith v. State Workmen’s Comp. Comm’r, 159 W. Va. 108, 219 S.E.2d 361 (1975).
See also Syl. pt. 1, Pond Creek Pocahontas Co. v. Alexander, 137 W. Va. 864, 74 S.E.2d 590
(1953) (“The basic and cardinal principle, governing the interpretation and application of a
statute, is that the Court should ascertain the intent of the Legislature at the time the statute
was enacted, and in the light of the circumstances prevailing at the time of the enactment.”).
However, this Court’s authority to construe a statute is confined to only those statutes that
contain an ambiguity. “A statute is open to construction only where the language used
requires interpretation because of ambiguity which renders it susceptible of two or more
constructions or of such doubtful or obscure meaning that reasonable minds might be
uncertain or disagree as to its meaning.” Hereford v. Meek, 132 W. Va. 373, 386, 52 S.E.2d
740, 747 (1949). See also Syl. pt. 5, State v. General Daniel Morgan Post No. 548, Veterans
of Foreign Wars, 144 W. Va. 137, 107 S.E.2d 353 (1959) (“When a statute is clear and
unambiguous and the legislative intent is plain, the statute should not be interpreted by the
courts, and in such case it is the duty of the courts not to construe but to apply the statute.”);
Syl. pt. 2, Pond Creek Pocahontas Co. v. Alexander, 137 W. Va. 864, 74 S.E.2d 590 (“Where
the meaning of a statute is clear and its provisions are unambiguous, this Court will not
undertake to construe and interpret it, but will apply the statute as its exact terms require.”);
Syl. pt. 2, State v. Epperly, 135 W. Va. 877, 65 S.E.2d 488 (1951) (“A statutory provision
8
which is clear and unambiguous and plainly expresses the legislative intent will not be
interpreted by the courts but will be given full force and effect.”).
Pursuant to the plain language of W. Va. Code § 38-16-202(a), “[a] common
law lien against real property is invalid and is not recognized or enforceable in this state.”
However, the foregoing statute may not be read in isolation. “Statutes which relate to the
same subject matter should be read and applied together so that the Legislature’s intention
can be gathered from the whole of the enactments.” Syl. pt. 3, Smith v. State Workmen’s
Comp. Comm’r, 159 W. Va. 108, 219 S.E.2d 361. See also Syl. pt. 5, in part, Fruehauf Corp.
v. Huntington Moving & Storage Co., 159 W. Va. 14, 217 S.E.2d 907 (1975) (“Statutes
which relate to the same persons or things, or to the same class of persons or things, or
statutes which have a common purpose will be regarded in pari materia to assure recognition
and implementation of the legislative intent.”). Thus, W. Va. Code § 38-16-202(a) must be
read and applied along with an accompanying statute contained within Article 16 of Chapter
38 providing that,
[R]egardless of whether such liens may also be
considered to be common law liens, nothing in this article is
intended to affect:
(1) Statutory liens arising under an enactment of the
Legislature;
(2) Equitable liens, constructive liens and other liens that
are imposed by a court of competent jurisdiction; or
(3) Consensual liens now or hereafter recognized under
the common law of this state.
9
W. Va. Code § 38-16-201 (emphasis added). The plain language of W. Va. Code
§ 38-16-201(3) declares that, “[r]egardless of whether such liens may also be considered to
be common law liens,” there is “nothing” in article 16 that is intended to affect “[c]onsensual
liens now or hereafter recognized under the common law of this state.” (Emphasis added).
Reading the proscription of common law liens against real property contained in W. Va.
Code § 38-16-202(a) in light of the plainly worded provision of W. Va. Code § 38-16-201(3),
it is irrefutable that W. Va. Code § 38-16-202(a) was not intended by the Legislature to affect
consensual common law liens.
This conclusion is in line with a recent memorandum decision handed down
by this Court in which we found that a homeowners association’s lien for unpaid assessments
was valid because it was consensual:
With regard to respondent association’s liens, the circuit court
found that they were valid because petitioner’s deeds showed
that he had consented to be bound by the Declaration. Both
deeds state that petitioner’s property interests were granted
“subject to and together with any and all covenants, conditions,
agreements, easements, rights, rights-of-way and/or restrictions
of record and in existence, including those of record in the
aforesaid Clerk’s Office in Deed Book No. 152, at page 862.”
Therefore, this Court finds that the circuit court correctly
determined that the liens were valid consensual liens.
In re Purported Lien or Claim Against DeBlasio, No. 13-1306, 2014 WL 4289334, at *4
10
(W. Va. Aug. 29, 2014) (mem. decision) (footnote omitted) (emphasis added).9
Based upon our analysis of the relevant statutes, we now expressly hold that,
pursuant to W. Va. Code § 38-16-202(a) (1999) (Repl. Vol. 2011) and W. Va. Code
§ 38-16-201 (1999) (Repl. Vol. 2011), which must be read and applied together, consensual
common law liens against real property are valid and enforceable in West Virginia.
In the instant case, the circuit court found that the liens at issue are consensual
common law liens. Utilizing reasoning similar to that expressed by this Court in DeBlasio,
the circuit court concluded that the Homeowners’ deeds conveyed property subject to the
“Declaration of Conditions, Covenants, Restrictions and Easements” recorded by Webber
Springs and, therefore, provided the requisite consent for a valid common law lien.10
9
The memorandum decision in DeBlasio does not identify what type of
common interest community was involved in that case. The Homeowners state in their
petition to this Court, however, that the community that placed the lien challenged in
DeBlasio is, like Webber Springs, a limited expense liability planned community.
10
The declaration contained the following provisions in Article X:
1. Creation of the Lien and Personal Obligation of
Assessments: . . . The annual, special and default assessments,
together with such interest thereon, and costs of collection
thereof as hereinafter provided, shall be a charge on the land and
shall be a continuing lien upon the property against which each
such interest thereon and cost of collection thereof as hereinafter
provided, shall also be the personal obligation of the person who
was the Owner of such property at the time when the assessment
(continued...)
11
The Homeowners contend that the liens at issue are not consensual because the
Homeowners never granted consent through an authenticated document and never signed any
deed. In this regard, the Homeowners point out that the deeds are from, and signed only by,
the grantor of the property. We reject this argument. The deed conveying real property to
the Fleets expressly provided that the conveyance was subject to “all rights, ways, utility line
easements and restrictive covenants of record.” (Emphasis added). Similarly, the deed
10
(...continued)
fell due.
....
9. Effect of Non-Payment of Assessment; The Personal
Obligation of Owner; the Lien; Remedies of the Association: If
the assessments are not paid on the date when due . . ., then such
assessment shall become delinquent and shall, together with
such interest thereon and the cost of collection thereof, as
hereinafter provided, thereupon become a continuing lien on the
property which shall bind such property in the hands of the then
Owner, his heirs, devisees, personal representative, successors
and assigns.
If the assessment is not paid within thirty (30) days after
the delinquency date, the assessment shall bear interest from the
date of delinquency at the maximum rate permitted by law and
the Association may bring an action at law against the Owner
personally obligated to pay the same or to foreclose the lien
against the property, and there shall be added to the amount of
such assessment the costs of preparing, filing and prosecuting
the complaint in such action (including reasonable attorney’s
fees), and in the event a judgment is obtained, such judgment
shall include interest on the assessments as above provided
together with costs of the action (including reasonable attorney’s
fees).
12
conveying property to Mr. Lampley contained a provision expressly making the conveyance
subject to “all those reservations, restrictions, easements and other matters of record in the
aforesaid Clerk’s Office . . . .”11 Thus, the restrictive covenants were incorporated into the
deeds that were accepted by the Homeowners. By accepting the conveyance, the
Homeowners necessarily are bound by the covenants and restrictions contained therein, even
though they did not, themselves, sign the deeds. In this regard, it has been observed that
the burden of a covenant stated in a deed falls upon a grantee
who accepts the deed even though the grantee did not sign the
document. The acceptance of a deed containing a covenant
amounts to the adoption of the signature of the grantor as that of
the grantee. Acceptance of the deed is also deemed to imply a
promise on the part of the grantee to perform the covenants to be
performed on his or her part.
20 Am. Jur. 2d Covenants, Conditions, and Restrictions § 4 (2015) (footnotes omitted). See,
e.g., Syl. pt. 1, in part, Richardson v. Hardman, 97 W. Va. 573, 125 S.E. 442 (1924) (“A
deed poll, after acceptance by the grantee, becomes the mutual act of the parties[.]”).12 See
11
References to where the restrictions and other matters of record are recorded
in the County Deed Books are included in Mr. Lampley’s deed.
12
A deed poll is “a deed executed by the grantor only.” 20 Am. Jur. 2d
Covenants, Conditions, and Restrictions § 4 (2015). See also Brendonwood Common v.
Franklin, 403 N.E.2d 1136, 1141 (Ind. Ct. App. 1980) (“The acceptance of a deed poll (a
deed signed only by the grantor) satisfies the Statute of Frauds and imposes the undertakings
in the deed upon the grantee. Thus, . . . a covenant (to erect a fence) contained in a deed
accepted by the grantee satisfies the Statute of Frauds and ran with the land to bind
subsequent grantees.”); Charles B. Sheppard, Land Use Covenants: A Summary of Aspects
of California Law Regarding Land Use Covenants with Comparisons to the Restatement
(Third) of Property, 37 W. St. U. L. Rev. 27, 33-34 (2009) (“Regardless of whether a deed
is a quitclaim deed, a general warranty deed, or a form of special warranty deed (for example,
(continued...)
13
also Newman v. Boehm, Pearlstein & Bright, Ltd., 119 F.3d 477, 481 (7th Cir. 1997) (“By
paying the purchase price and accepting title to their home, the Riters became bound by the
Declaration of Covenants, Conditions, and Restrictions of their homeowners association,
which required the payment of regular and special assessments imposed by the association.”);
Citizens for Covenant Compliance v. Anderson, 12 Cal. 4th 345, 363, 906 P.2d 1314, 1325
(1995) (explaining that “if the restrictions are recorded before the sale, the later purchaser
is deemed to agree to them. The purchase of property knowing of the restrictions evinces the
buyer’s intent to accept their burdens and benefits.”); Johnston v. Michigan Consol. Gas Co.,
337 Mich. 572, 579, 60 N.W.2d 464, 468 (1953) (recognizing that “the acceptance by the
grantee of a deed poll signed and sealed by the grantor containing covenants to be performed
by the grantee binds the latter to the performance of these covenants as effectually as if he
had executed the instrument” (quotations and citation omitted)); Warrender v. Gull Harbor
Yacht Club, Inc., 747 S.E.2d 592, 600 (N.C. Ct. App. 2013) (observing that “restrictive
covenants are contractual in nature, and that acceptance of a valid deed incorporating
covenants implies the existence of a valid contract with binding restrictions” (quotations and
12
(...continued)
the California form of grant deed), under the American system of jurisprudence, any such
deed is likely to be a deed poll instead of being an indenture. A deed poll is subscribed only
by the transferor.” (footnotes omitted)). See generally 23 Am. Jur. 2d Deeds § 3 (2013)
(describing “deed poll” as “a deed executed by the grantor only, the usual form of
commencement being . . . ‘I . . . hereby grant, etc.’” (footnote omitted)).
14
citation omitted)).13 Therefore, we find that the circuit court did not err in concluding that
Webber Springs had a valid common law lien against the Homeowners’ respective properties
for unpaid homeowners association assessments and granting partial summary judgment to
Webber Springs on this issue.
The Homeowners additionally contend that, even if Webber Springs had a valid
consensual lien for unpaid assessments, it would not have a common law lien for attorney’s
fees and costs. Because the Homeowners rely on an application of the West Virginia
Consumer Credit and Protection Act to support this argument, we will address the same
below in our discussion of the applicability of the Consumer Credit and Protection Act.
B. Application of the West Virginia Consumer Credit and Protection Act
The Homeowners argue that the circuit court erred in concluding that the West
Virginia Consumer Credit and Protection Act (“WVCCPA”) does not apply to the debt
collection practices of Webber Springs, and in making the alternative finding that, even if
the WVCCPA did apply, the Homeowners’ counterclaims would be time-barred by the one-
year limitations period provided in W. Va. Code § 46A-5-101 (1996) (Repl. Vol. 2006).
13
Because we reject the Homeowners’ interpretation of the relevant statutes as
prohibiting consensual common law liens on real property, we likewise reject their related
argument, which is based upon their erroneous interpretation of the statute, that Webber
Springs could have a valid lien against real property only if the lien is authorized by statute.
15
Instead, the Homeowners, joined by Amicus Curiae, the West Virginia Association for
Justice, contend that the unfair debt collection provisions of the WVCCPA apply more
broadly than the remainder of the Act and are applicable to the instant matter. In addition,
the Homeowners assert that there is no time limitation applicable to counterclaims to an
action against a consumer under the WVCCPA. See W. Va. Code § 46A-5-102 (1974) (Repl.
Vol. 2006). Accordingly, they assert their counterclams are not time-barred.
Webber Springs, on the other hand, argues that the assessments subject to its
collection efforts do not qualify as a “claim” even under the broad definition utilized in the
unfair debt collection provisions of the WVCCPA. In this regard, Webber Springs
characterizes the assessments as being for community purposes, and not “primarily for
personal, family or household purposes” as the statutory definition of a “claim” requires.
W. Va. Code § 46A-2-122(b) (1996) (Repl. Vol. 2006). Furthermore, Webber Springs
asserts that, because the Homeowners’ counterclaims do not fall within the WVCCPA, they
are barred by the two-year general statute of limitation found in W. Va. Code § 55-2-12
(1959) (Repl. Vol. 2008).
“This Court has recognized that the CCPA is a remedial statute intended to
protect consumers from unfair, illegal and deceptive business practices, and must be liberally
construed to accomplish that purpose.” Harper v. Jackson Hewitt, Inc., 227 W. Va. 142, 151,
16
706 S.E.2d 63, 72 (2010). See also Barr v. NCB Mgmt. Servs., Inc., 227 W. Va. 507, 513,
711 S.E.2d 577, 583 (2011) (recognizing “the remedial purposes of the WVCCPA, and the
liberal construction we have historically afforded this Act”).
The unfair debt collection provisions of the WVCCPA are codified at W. Va.
Code §§ 46A-2-122 through 129a. There are certain definitions applicable to only those nine
sections. Thus, for purposes of the unfair debt collection provisions of the WVCCPA, the
term “consumer” is broadly defined to mean “any natural person obligated or allegedly
obligated to pay any debt.” W. Va. Code § 46A-2-122(a) (emphasis added). A “debt
collector” for purposes of the specified sections also is broadly defined to be “any person or
organization engaging directly or indirectly in debt collection. The term includes any person
or organization who sells or offers to sell forms which are, or are represented to be, a
collection system, device or scheme, and are intended or calculated to be used to collect
claims.” W. Va. Code § 46A-2-122(d) (emphasis added). The plain language14 of these
definitional sections certainly is broad enough to include the Homeowners within the
definition of a “consumer” and to include Webber Springs within the definition of the term
“debt collector.” The instant issue, however, appears to turn on the definition of the term
14
“When a statute is clear and unambiguous and the legislative intent is plain,
the statute should not be interpreted by the courts, and in such case it is the duty of the courts
not to construe but to apply the statute.” Syl. pt. 5, State v. General Daniel Morgan Post No.
548, Veterans of Foreign Wars, 144 W. Va. 137, 107 S.E.2d 353 (1959).
17
“claim”:
“Claim” means any obligation or alleged obligation of a
consumer to pay money arising out of a transaction in which the
money, property, insurance or service which is the subject of the
transaction is primarily for personal, family or household
purposes, whether or not such obligation has been reduced to
judgment.
W. Va. Code § 46A-2-122(b) (emphasis added).
Relevant to our determination of whether the assessments sought by Webber
Springs are primarily for personal, family, or household purposes is the asserted reason for
the assessments. The Declaration filed by Webber Springs to establish the Webber Springs
community expressly sets out the purpose of the assessments as follows:
Purpose of Assessments: The assessments levied by the
Association shall be used exclusively for the purpose of road
and street maintenance, promoting the recreation, health, safety,
and welfare of the residents in The Properties and in particular
for the improvement and maintenance of properties, services,
and facilities devoted to this purpose and related to the use and
enjoyment of the Common Properties and homes situated on The
Properties, including, but not limited to, the payment of taxes
and insurance thereon and repair, replacement and additions
thereto, and for the cost of labor, equipment, materials,
management, and supervision thereof.
While this Court has not addressed whether the unfair debt collection
provisions of the WVCCPA apply in the context of homeowners association assessments,
this issue has been addressed by federal courts interpreting the federal Fair Debt Collection
18
Practices Act (“FDCPA”). Notably, the FDCPA definition of a “debt” is essentially identical
to the definition of a “claim” set out in W. Va. Code § 46A-2-122(b). Pursuant to the
FDCPA,
[t]he term “debt” means any obligation or alleged
obligation of a consumer to pay money arising out of a
transaction in which the money, property, insurance, or services
which are the subject of the transaction are primarily for
personal, family, or household purposes, whether or not such
obligation has been reduced to judgment.
15 U.S.C. § 1692a(5) (2010) (2012 ed.). Federal courts have found the FDCPA to be
applicable to the collection of association fees. In Newman v. Boehm, Pearlstein & Bright,
Ltd., 119 F.3d 477, 479, the court found that “an assessment owed to a homeowners or
condominium association qualifies as a ‘debt’ under the Fair Debt Collection Practices Act.”
The Newman court reasoned that
[b]y paying the purchase price and accepting title to their home,
the [homeowners] became bound by the Declaration of
Covenants, Conditions, and Restrictions of their homeowners
association, which required the payment of regular and special
assessments imposed by the association. . . . It is therefore clear
that the obligation to pay in these circumstances arose in
connection with the purchase of the homes themselves, even if
the timing and amount of particular assessments was yet to be
determined.
119 F.3d at 481. Finally, the Newman court explained that
there can be little doubt that the subject of those transactions
[the purchase of a home] had a personal, family, or household
purpose. More specifically, however, we also believe that the
assessments themselves satisfy that statutory requirement. To
the extent that the assessments were to be used to improve or
19
maintain commonly-owned areas, that purpose, too, qualifies as
“personal, family, or household.” In our view, when a special
assessment is used to repair a common roof, or a monthly
assessment is used to pay for services like snow removal from
a common walkway or landscaping of a common yard, the
assessments are for a household purpose even if more than a
single household benefits.
Id. See also Ladick v. Van Gemert, 146 F.3d 1205, 1205 & 1207 (10th Cir. 1998)
(concluding that “assessment owed to a condominium association qualifies as a ‘debt’ within
the meaning of the Fair Debt Collection Practices Act” based upon express finding that,
“although the assessment at issue here is used to maintain and repair the common area, it
nevertheless has a primarily personal, family, or household purpose.”); Williams v. Edelman,
408 F. Supp. 2d 1261, 1266 (S.D. Fla. 2005) (concluding that condominium assessments are
debt within meaning of FDCPA); Dikun v. Streich, 369 F. Supp. 2d 781, 785 (E.D. Va. 2005)
(observing that “[p]roperty owners association assessments for a plaintiff’s residence are
debts subject to the FDCPA”); Fuller v. Becker & Poliakoff, P.A., 192 F. Supp. 2d 1361,
1368 (M.D. Fla. 2002) (explaining, “[l]ike the condominiums in Newman, the interests that
Plaintiffs bought in the RV park were for personal or family purposes. Also, like the
past-due assessments in Newman, Plaintiffs’ maintenance assessments arose out of the
purchase of the interest in the RV park, and the assessments are used to maintain the park for
the benefit of the park; thus, the assessments are for personal or family purposes. Moreover,
the maintenance assessments are obligations of [sic] arising out [of] the Plaintiffs’
transactions in purchasing the interests in the RV park. Therefore, the Court finds that the
20
maintenance assessments that the Association sought to collect . . . are debts subject to the
FDCPA.”); Caron v. Charles E. Maxwell, P.C., 48 F. Supp. 2d 932, 934 (D. Ariz. 1999)
(adopting Newman reasoning that homeowners’ “‘assessments are collected in order to
improve and maintain commonly-owned areas used by each unit owner. The [homeowners’]
assessments thereby directly benefit each household in the development. As a result, the
assessments have a ‘personal, family, or household purpose.’” and concluding that, “[l]ike
the other courts that have followed the reasoning set forth in Newman, this Court is
persuaded by the reasoning of the Seventh Circuit” (quoting Newman, 119 F.3d at 481–82)
(emphasis omitted)); Garner v. Kansas, No. CIV. A. 98-1274, 1999 WL 262100, at *2 (E.D.
La. Apr. 30, 1999) (“Upon review of the FDCPA and the case law discussing this issue, the
Court concludes that condominium fees do constitute ‘debts’ under the FDCPA.”); Taylor
v. Mount Oak Manor Homeowners Ass’n, Inc., 11 F. Supp. 2d 753, 754 (D. Md. 1998)
(concluding that homeowners association’s assessments are “debts” under the FDCPA);
Thies v. Law Offices of William A. Wyman, 969 F. Supp. 604, 608 (S.D. Cal. 1997) (applying
Newman rationale and concluding “homeowner association fees for maintenance and
improvement of common areas within a housing development are a service primarily for
personal, family, and household purposes”). But see Nance v. Petty, Livingston, Dawson &
Devening, 881 F. Supp. 223, 225 (W.D. Va. 1994) (citing 15 U.S.C. § 1692a(5) and finding
assessment by subdivision for maintenance of private road was not “‘primarily for personal,
family, or household’” purposes (quoting 15 U.S.C. § 1692a(5))).
21
We agree with the reasoning of the federal courts interpreting a nearly identical
statute. Therefore, this Court holds that homeowners association assessments that are to be
used for improving and/or maintaining common areas of a planned community, including,
but not limited to, maintaining common roads and common recreational areas within the
community, are an obligation primarily for personal, family, or household purposes, and,
therefore, such assessments are “claims” pursuant to W. Va. Code § 46A-2-122(b) (1996)
(Repl. Vol. 2006). It follows, then, that because the Homeowners are consumers, because
Webber Springs is a debt collector, and because the assessments are claims, the unfair debt
collection provisions of the WVCCPA do apply to this matter. Thus, the circuit court erred
in granting partial summary judgment in favor of Webber Springs based upon its erroneous
conclusion that the WVCCPA was not applicable. Likewise, the circuit court erred in finding
that the Homeowners’ WVCCPA counterclaims are barred by the statute of limitations. The
counterclaims of the Homeowners are not time-barred. See W. Va. Code § 46A-5-102
(“Rights granted by this chapter may be asserted as a defense, setoff or counterclaim to an
action against a consumer without regard to any limitation of actions.” (emphasis added)).
Because the circuit court ruled that the WVCCPA did not apply, that court has
made no rulings purporting to resolve the Homeowners’ specific claims under the WVCCPA,
including their claim that Webber Springs is prohibited from collecting attorney’s fees and
costs. Accordingly, we decline to address the Homeowners’ contention that Webber Springs
22
is prohibited from collecting attorney’s fees and costs as such a decision by this Court would
be advisory. “[T]his Court is not authorized to issue advisory opinions[.]” State ex rel. City
of Charleston v. Coghill, 156 W. Va. 877, 891, 207 S.E.2d 113, 122 (1973) (Haden, J.,
dissenting).
IV.
CONCLUSION
For the reasons stated in the body of this opinion, we conclude that W. Va.
Code § 38-16-202(a) (1999) (Repl. Vol. 2011) and W. Va. Code § 38-16-201 (1999) (Repl.
Vol. 2011) authorize a consensual common law lien against real property and that the unfair
debt collection provisions of the WVCCPA do apply to a homeowners association’s attempts
to collect delinquent assessments. Accordingly, we affirm, in part; reverse, in part; and
remand this case for further proceedings consistent with this opinion.
Affirmed, in part; Reversed, in part; and Remanded.
23