H. B. 4030


(By Delegates Trump, L. White,
Faircloth, Rowe, Staton
and Johnson)
[Introduced January 19, 1998; referred to the
Committee on the Judiciary.]


A BILL to amend and reenact section five, article two, chapter fifty-five of the code of West Virginia, one thousand nine hundred thirty-one, as amended, relating to limitation of actions and suits enforcing liens reserved by any conveyance of real estate or created by any trust deed or mortgage on real estate; providing for extensions of the liens; and addressing the retroactive and prospective application of changes made.

Be it enacted by the Legislature of West Virginia:
That section five, article two, chapter fifty-five of the code of West Virginia, one thousand nine hundred thirty-one, as amended, be amended and reenacted to read as follows:
ARTICLE 2. LIMITATION OF ACTIONS AND SUITS.

 §55-2-5. Enforcement of liens reserved by conveyance or created by deed of trust or mortgage on real estate.
(a) Any lien reserved by any conveyance of real estate or created by any deed of trust or mortgage on real estate expires after the following periods of time, unless suit to enforce the lien is instituted prior to expiration of the time period or unless the lien is extended as specified in subsections subsection (b) or (e) of this section:
(1) If the final maturity date of the lien obligation is ascertainable from the record instrument, the lien expires five years after that date.
(2) If the final maturity date of the lien obligation is not ascertainable from the record instrument, the lien expires thirty-five years after the date of the lien instrument. However, if the lienholder rerecords the lien instrument prior to thirty-five years from the date of the lien and includes a copy of the obligation secured by the lien so that the final maturity is ascertainable, the lien expires five years after the date of maturity. A lien instrument securing a lien obligation which is payable on demand expresses no maturity date.
(b) If an affidavit or extension agreement notice executed by the secured party and the grantor or mortgagor to or beneficiary of the lien obligation or an amendment to the lien instrument executed by the grantor or mortgagor and the secured party or beneficiary is recorded prior to expiration of the original period of limitation, as specified in subsection (a) of this section, the time is extended as follows:
(1) If the final maturity date of the lien obligation, as extended, secured by the lien is ascertainable from the record of the affidavit or extension agreement notice or an amendment, the lien expires five years after the date of final maturity of the obligation, as extended.
(2) If the final maturity date of the lien obligation, as extended, secured by the lien instrument is not ascertainable from the record of the affidavit or extension agreement notice or an amendment, the lien expires thirty-five years after the date of the lien instrument. However, if the lienholder rerecords the lien instrument prior to thirty-five years from the date of the lien and includes a copy of the obligation secured by the lien so that the final maturity is ascertainable, the lien expires five years after the date of maturity.
(c) Any affidavit or extension agreement notice or an amendment filed pursuant to subsection (b) of this section after the effective date of this section, shall include, but is not limited to, the following:
(1) The unpaid balance of the debt and interest secured by the lien instrument;
(2) The final maturity date of the obligation of the lien, as extended; and
(3) The book and page of recordation of the original lien instrument.
The clerk of the county commission shall record and index any affidavit or extension agreement notice or an amendment in the same manner as the original lien instrument and note that filing on the margin of the page where the original lien instrument is recorded.
(d) If the record instrument of the lien obligation shows that it secures an obligation payable in installments and the maturity date of the final installment of the obligation is ascertainable from the lien instrument, the time runs from the maturity date of the final installment.
(e) Nothing in this section extinguishes any lien obligation which was reserved or created and in effect prior to the effective date of this section: Provided, That if any such lien should be extinguished by this section, then any action to enforce such lien shall be brought or recordation of any extended lien obligation pursuant to subsection (b) of this section shall be made before the first day of July, one thousand nine hundred ninety-eight first day of July, one thousand nine hundred ninety-eight. With respect to any lien obligation reserved or created and in effect prior to the first day of July, one thousand nine hundred ninety-eight, the lien obligation is valid for twenty years after its stated maturity, or if no maturity date is stated in the lien instrument, for thirty-five years after the date of the lien instrument.
(f) The time shall may be extended only as provided in this section and shall may not be extended by any other method or by operation of law.
(g) Subject to the provisions of subsection (e) of this section, the provisions of this section apply with like effect to every such lien now existing as well as to every such lien hereafter reserved or created.

NOTE: The purpose of this bill is to modify certain of the significant changes made to the statute of limitations on deeds of trusts made during the 1997 Legislative Session. The changes alleviate significant hardships on lienholders and attempt to reduce customer confusion resulting from the retroactive application of a relatively short statute of limitations.

Strike-throughs indicate language that would be stricken from the present law, and underscoring indicates new language that would be added.