United States District Court, S.D. West Virginia, Charleston
T. COPENHAVER, JR., SENIOR UNITED STATES DISTRICT JUDGE
is the Motion for Partial Summary Judgment on its
Counterclaims, filed by the defendant, Wilmington Savings
Fund Society (“Wilmington”), on October 11, 2018.
Wilmington acquired the mortgage loan in issue in 2017. FCI
Lender Services, Inc. (“FCI”) services the loan.
2003, the plaintiff, Barbara Ortiz (“Ortiz”),
owed approximately $88, 000 in real estate debt and $15, 000
on a judgment lien, also secured by a second lien on the same
real estate. Amended Compl. ¶ 8. Later that year, Ortiz
refinanced both debts, along with other unsecured debt, in an
“overarching, refinancing debt (the
“Loan”)” with Fremont Investment & Loan
Company. Def.'s Mot. Summ. J. 2 (citing Amended Compl.
¶ 14). Under the Loan, Ortiz executed a note for $115,
545 (“Note”), secured by a deed of trust on her
real estate (“Deed of Trust”). Def.'s Mot.
Summ. J. 2 (citing Amended Compl. ¶ 41).
31, 2017, Wilmington became owner of the Note, Deed of Trust,
and Ortiz's debt through a series of assignments. Amended
Compl. ¶ 5; Countercl. ¶ 5-7. Ortiz owed regular
monthly payments under the Note and Deed of Trust, but failed
to furnish them timely. Def.'s Mot. Summ. J. at Aff.;
Countercl., Ex. A, B. As a result, she breached the terms of
the Note and Deed of Trust, triggering the Loan's
acceleration and the lender's option to exercise its
power of sale. Countercl., Ex. 2 at 15.
has been in default on the Loan since December 11, 2017.
Def.'s Mot. Summ. J. at Aff. ¶ 10. She has not made
a full, timely payment since May 18, 2017. Id.
¶ 9. On December 14, 2017, Wilmington served notice to
execute a foreclosure sale of the property. Id. at
Ex. G. Thereafter, on April 9, 2018, Ortiz instituted a
lawsuit against defendants Wilmington and FCI in Fayette
County Circuit Court, alleging various contractual defenses
of unconscionability and fraud and affirmative claims of
fraud and excessive late fees. See Amended Compl. The
complaint consists of six counts of which the principal
counts are: Count I, Contract Defense -Unconscionable Broker
Agreement (as to Broker Dana Capital only); Count II, Fraud
as a Contract Defense - Loan Agreement (Loan
Servicer/Holder); Count III, Unconscionability as a Contract
Defense to the Loan Agreement (Loan Servicer/Holder); and
Count IV, Fraud as a Contract Defense and for Damages (as to
all defendants). Of the two remaining counts, Count V has
been voluntarily dismissed and Count VI relates to Excessive
Late Fees (Loan Servicer and Lender).
removed the action to this court on July 9, 2018, and
Wilmington filed counterclaims for breach of contract and
declaratory judgment, seeking to exercise its power of sale
under the Deed of Trust. See Countercl. Wilmington now moves
for summary judgment on its claim for declaratory judgment,
requesting that the court authorize a foreclosure sale of the
property owned by the plaintiff.
is entitled to summary judgment “if the pleadings, the
discovery and disclosure materials on file, and any
affidavits show that there is no genuine issue as to any
material fact and that the movant is entitled to judgment as
a matter of law.” Fed.R.Civ.P. 56(c). Material facts
are those necessary to establish the elements of a
party's cause of action. Anderson v. Liberty Lobby,
Inc., 477 U.S. 242, 248 (1986).
genuine issue of material fact exists if, in viewing the
record and all reasonable inferences drawn therefrom in a
light most favorable to the non-moving party, a reasonable
fact-finder could return a verdict for the non-movant.
Id. The moving party has the burden of showing -
“that is, pointing out to the district court - that
there is an absence of evidence to support the nonmoving
party's case.” Celotex Corp. v. Catrett,
477 U.S. 317, 325 (1986). If the movant satisfies this
burden, then the non-movant must set forth specific facts as
would be admissible in evidence that demonstrate the
existence of a genuine issue of fact for trial. Fed.R.Civ.P.
56(c); Id. at 322-23. A party is entitled to summary
judgment if the record as a whole could not lead a rational
trier of fact to find in favor of the non-movant.
Williams v. Griffin, 952 F.2d 820, 823 (4th Cir.
summary judgment is inappropriate if the evidence is
sufficient for a reasonable fact-finder to return a verdict
in favor of the non-moving party. Anderson, 477 U.S.
at 248. Even if there is no dispute as to the evidentiary
facts, summary judgment is also not appropriate where the
ultimate factual conclusions to be drawn are in dispute.
Overstreet v. Ky. Cent. Life Ins. Co., 950 F.2d 931,
937 (4th Cir. 1991).
claims it is entitled to exercise its power of sale on its
security interest in the property that secures the Loan, even
if the court later finds in favor of the plaintiff on her
claims. While it denies the validity of Ortiz's claims,
the defendant consents to holding the funds from the
foreclosure sale in escrow until monetary damages, if any,
are determined. The plaintiff counters, arguing that the
motion is premature, inasmuch as her claims have not yet been
resolved and the defendant's motion for summary judgment
is “essentially a motion for preliminary
injunction” that fails to satisfy the requisite
complaint, Ortiz asserts both fraud and unconscionability as
contract defenses to the enforcement of the Loan. Amended
Compl. ¶¶ 68, 70, 77. Subsection 46A-2-121(a)(1) of
the West Virginia Code provides that if a court finds a
consumer loan to “have been unconscionable at the time
it was made, or to have been induced by unconscionable
conduct such as affirmative misrepresentations, active deceit