United States District Court, S.D. West Virginia, Charleston
WILLIAM W. BOSTER, JR., Plaintiff,
LIVE WELL FINANCIAL, INC., And COMPU-LINK CORPORATION d/b/a Celink, Defendants.
MEMORANDUM OPINION AND ORDER
T. Copenhaver, Jr. United States District Judge
is the motion to dismiss, filed by defendant Live Well
Financial, Inc. on August 28, 2017, and the joinder motion to
dismiss, filed by defendant Compu-Link Corporation d/b/a
Celink on August 29, 2017.
Factual and Procedural Background
This is a civil action to quiet plaintiff's title in his
personal residence. Compl. ¶ 1. Plaintiff, William
Boster, resides in a home that was previously owned by his
parents, William Wayne Boster, Sr. and Wanda Jean Boster.
Id. at ¶¶ 5-6, 8. Following his
father's death, Wanda Boster “deeded ownership of
the home in which she lived to plaintiff . . . reserving to
herself a life estate.” Id. at ¶ 7. Mr.
Boster later moved into the home to care for his mother.
Id. at ¶ 8. On July 9, 2007, Wanda Boster
granted her son “a durable power of attorney
authorizing plaintiff to handle her personal, medical, and
financial affairs, including power to encumber the life
estate which constituted her only real property.”
Id. at ¶ 9.
of Wanda Boster's deteriorating health and associated
costs, in 2014, Mr. Boster, on his mother's behalf,
obtained a Home Equity Conversion Mortgage, known commonly as
a reverse mortgage, on the home from Proficio Mortgage
Ventures LLC (“Proficio”). Id. at
¶¶ 11, 23-25. Proficio was authorized to make
reverse mortgages, between the years 2006 and 2016, pursuant
to the license issued to it by the West Virginia Commissioner
of Financial Institutions. Compl. ¶¶ 11-12. A
reverse mortgage is “a nonrecourse loan secured by real
property which (1) [p]rovides cash advances to a borrower
based on the equity in a borrower's owner-occupied
principal residence . . . [and] (2) [r]equires no payment of
principal or interest until the entire loan becomes due and
payable.” W.Va. Code § 47-24-3; see also Reverse
Annuity Mortgage, Black's Law Dictionary (10th ed. 2014).
represented to Mr. Boster, on behalf of his mother,
“that it would extend an open-end, revolving reverse
mortgage loan to [his] 79 year-old mother.” Compl.
¶ 27. Because Ms. Boster only had a life estate in the
property, Proficio also “required [that] plaintiff
separately obligat[e] his own fee simple remainder interest
to secure payment by [cosigning] the Deeds of Trust in
Proficio's favor, even though plaintiff would not have
any contractual right to obtain [or] use the line of credit
in his personal capacity.” Id. at ¶¶
28-29. At the closing of the reverse mortgage loan, plaintiff
signed “two Fixed Rate Note-Open End (Home Equity
Conversion) instruments” on behalf of his mother, a
“Home Equity Conversion Mortgage Loan Agreement Open
End” on behalf of his mother, and Deeds of
Trust which he signed both on behalf of his
mother and separately in his personal capacity. Id.
at ¶¶ 30-34. The Deeds of Trust identified
plaintiff as “remainderman” and Ms. Boster as the
“grantor/borrower.” Id. at ¶¶
33-34. Only the Deeds of Trust were signed by the plaintiff
in his personal capacity.
point after the reverse mortgage loan was made, defendant
Live Well Financial, Inc. (“Live Well”) took the
loan by assignment from Proficio. Id. at ¶ 16.
Live Well is also authorized to make and own reverse mortgage
loans in West Virginia pursuant to the license issued to it
by the West Virginia Commissioner of Financial Institutions.
Id. at ¶¶ 14-15. The loan is serviced by
defendant Compu-Link Corporation d/b/a Celink
(“Celink”) who is similarly licensed to service
loans in West Virginia. Id. ¶ 20.
Boster's full debt was due on April 14, 2085, but the
lender was allowed to accelerate the debt if, in pertinent
(i) A Borrower dies and the Property is not the principal
residence of at least one surviving Borrower; or . . .
(iii) The Property ceases to be the principal residence of a
Borrower for reasons other than death and the Property is not
the principal residence of at least one other Borrower; or
(iv) For a period of longer than 12 consecutive months, a
Borrower fails to occupy the Property because of physical or
mental illness and the Property is not the principal
residence of at least one other Borrower; or
(v) An obligation of the Borrower under this Security
Instrument is not performed.
Fixed Rate Home Equity Conversion Second Deed of Trust a
Credit Line Deed of Trust Ex. 2 to Pl.'s Resp. to Def. Live
Well's Mot. Dismiss at pp. 1, 4; see also W.Va. Code
§ 47-24-4(g). Ms. Boster's health further declined
such that she was transferred into a nursing home in November
of 2016. Compl. ¶ 37. On November 25, 2016, Ms. Boster
passed away. Id.
alleges that “[b]eginning when his mother required
nursing home care, defendants wrongly began attempts to
collect payment of Ms. Boster's reverse mortgage
loan.” Id. at ¶ 38. Celink told Mr.
Boster that “unless he personally paid the amount
claimed due, ” Live Well would sell the home to pay off
the loan. Id. at ¶ 39. On November 16, 2016,
defendants, by their debt collection agent Samuel L. White,
P.C., “falsely represented that the terms of the Fixed
Rate Note-Open End [(“the Notes”)] had been
breached ‘by reason of your failure to pay the
installments'” because the Notes required no
installment payments. Id. at ¶ 40. The letter
demanded payment of the entire loan by December 16, 2016 in
order to cure the purported breach. Id. at ¶
41. Plaintiff asserts that the amount demanded included
“fees and charges not allowed by West Virginia law,
including ‘property inspection' fees, ” and
that the letter “wrongfully and unlawfully
[represented] that defendants could sell plaintiff's home
if the amount demanded was not paid by the date
stated.” Id. at ¶¶ 42-43. Mr. Boster
received a second letter on December 27, 2016, which was sent
by defendants' debt collection agent Seneca Trustees,
Inc. Id. at ¶ 44. This letter “wrongfully
and unlawfully” represented that defendants would
collect the amount due “by selling plaintiff's home
on the steps of the Kanawha County courthouse on February 9,
January of 2017, Mr. Boster “discovered facts
constituting all the elements of a cause of a cause of action
under W.Va. Code Article § 31-17 and Article §
47-24, and their implementing regulations.”
Id. at ¶ 47. Mr. Boster alleges that Proficio
contracted for and collected illegal charges and fees, took a
security interest in excess of that permitted by W.Va. Code
R. § 106-9-6.6, and “otherwise failed to comply
with the prerequisites [of W.Va. Code] Article § 47-24
and its implementing regulations.” Id. at
¶¶ 48-49. Mr. Boster argues that the reverse
mortgage and Deeds of Trust securing it are “void and
unenforceable by operation of law, including pursuant to
W.Va. Code § 31-17-17.” Id. at ¶ 52.
Therefore, plaintiff states that he may not be held liable
for the repayment of the reverse mortgage loan through the
sale of the home. Id. at ¶ 55.
3, 2017, Mr. Boster brought this action in the Circuit Court
of Kanawha County, West Virginia. With the consent of Celink,
Live Well timely removed the case to this court, invoking
diversity jurisdiction pursuant to 28 U.S.C. § 1332.
Notice of Removal at ¶¶ 6, 11. Plaintiff asserts
two counts against the defendants in connection with these
events. First, Mr. Boster asks that the court “declare
defendants' claimed lien void and unenforceable, and to
enter a preliminary and a permanent injunction barring
defendants from any action to enforce or assign it.”
Id. at ¶ 59. Mr. Boster asserts that the lien
is unenforceable because the reverse mortgage violates the
West Virginia Residential Mortgage Lender, Broker, and
Servicer Act (“RMLBSA”), W.Va. Code §
31-17-1, et seq., the West Virginia Reverse Mortgage Enabling
Act (“Reverse Mortgage Act”), W.Va. Code §
47-24-1, et seq., and the West Virginia Consumer Credit and
Protection Act (“WVCCPA”), W.Va. Code §
46A-2-104(a). See Id. at ¶¶ 47-49, 53-55.
Second, he asserts that defendants engaged in illegal debt
collection acts in violation of provisions of the WVCCPA,
W.Va. Code §§ 46A-2-127, 46A-2-128. Id.
seek to dismiss the entire two-count complaint pursuant to
Fed.R.Civ.P. 12(b)(6) for failure to state a claim upon which
relief can be granted. Defendant Live Well asserts that Count
I of the complaint fails because it is (1) untimely, (2) does
not adequately plead any violations of the RMBLSA, (3) pleads
no facts to support a violation of the Reverse Mortgage Act,
and (4) Mr. Boster is not a “cosigner” eligible
for protection under the WVCCPA. See Def. Live Well's
Mem. Supp. Mot. Dismiss (“Live Well Mem.”) at
7-12. Furthermore, Live Well seeks to dismiss Count II of the
complaint, alleging that Mr. Boster does not have standing to
bring the claim, as he is not a “consumer” under
the WVCCPA. Id. at 4. Defendant Celink joins and
adopts all of these arguments for dismissal, and further adds
that Count II fails because the complaint fails to include
sufficient factual allegations to support plaintiff's
claims for fraudulent, deceptive, or misleading
representations, and unfair and unconscionable means of
collection under the WVCCPA. Def. Celink's Mem. Supp.
Mot. Dismiss (“Celink Mem.”) at 2-3.
Rule of Civil Procedure 8(a)(2) requires that a pleading
“contain . . . a short and plain statement of the claim
showing that the pleader is entitled to relief.”
Correspondingly, Rule 12(b)(6) provides that a pleading may
be dismissed for a “failure to state a claim upon which
relief can be granted.
survive a motion to dismiss, a pleading must recite
“enough facts to state a claim to relief that is
plausible on its face.” Bell Atlantic Corp. v.
Twombly, 550 U.S. 544, 570 (2007); see also Monroe
v. City of Charlottesville, 579 F.3d 380, 386 (4th Cir.
2009) (quoting Giarratano v. Johnson, 521 F.3d 298,
302 (4th Cir. 2008)). In other words, the “[f]actual
allegations must be enough to raise a right to relief above
the speculative level.” Twombly, 550 U.S. at 555
(citation omitted); see also Ashcroft v. Iqbal, 556
U.S. 662, 678 (2009) (“A claim has facial plausibility
when the plaintiff pleads factual content that allows the
court to draw the reasonable inference that the defendant is
liable for the misconduct alleged.”); Andrew v.
Clark, 561 F.3d 261, 266 (4th Cir. 2009) (quoting
Twombly, 550 U.S. at 555).
district court's evaluation of a motion to dismiss is
underlain by two principles. First, when considering a motion
to dismiss, the court “must accept as true all of the
factual allegations contained in the [pleading].”
Erickson v. Pardus, 551 U.S. 89, 94 (2007) (citation
omitted); see also Twombly, 550 U.S. at 555 (“Factual
allegations must be enough to raise a right to relief above
the speculative level, . . . on the assumption that all the
allegations in the complaint are true (even if doubtful in
fact).”) (citations omitted). In doing so, factual
allegations should be distinguished from “mere
conclusory statements, ” which are not to be regarded
as true. Iqbal, 556 U.S. at 678 (“[T]he tenet that a
court must accept as true all of the allegations contained in
a complaint is inapplicable to legal conclusions.”).
Second, the court must “draw all reasonable factual
inferences . . . in the [nonmovant's] favor.”
Edwards v. City of Goldsboro, 178 F.3d 231, 244 (4th
Cir. 1999); see also Jenkins v. McKeithen, 395 U.S.
411, 421 (1969) (“[T]he complaint is to be liberally
construed in favor of plaintiff.”).