COMMITTEE SUBSTITUTE
FOR
H. B. 2793
(By Delegates Staton, Fleischauer and Trump
)
(Originating in the Committee on the Judiciary)
[April 1, 1997]
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 for liens reserved by any conveyance of real
estate or created by any trust deed or mortgage on real
estate; changing the expiration of any such lien obligation
where the final maturity date is ascertainable; providing an
expiration for any lien obligation where the final maturity
date is not ascertainable; providing certain exceptions
thereto; changing the expiration of any affidavit or extension
agreement of such a lien obligation where the final maturity
date is ascertainable; providing an expiration for any
affidavit or extension agreement of such a lien obligation
where the final maturity date is not ascertainable; providing
requirements for future affidavits or extension agreements filed and method of recordation by the clerk of the county
commission; providing that where a lien instrument secures an
obligation in installments the time runs from the date of the
final installment; providing a grace period for enforcement or
recordation of liens reserved or created and in effect on the
effective date; providing that the time shall be extended only
as provided in this section; and providing that this section
applies to all such liens, existing and hereafter reserved or
created.
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.
No lien reserved on the face of any conveyance of real estate,
or lien created by any trust deed or mortgage on real estate, shall
be valid or binding as a lien on such real estate, after the
expiration of twenty years from the date on which the debt or
obligation secured thereby becomes due, unless suit to enforce the
same shall have been instituted prior to the expiration of such
period. If any debt or obligation incurred or maturing subsequent
to the debt or obligation secured by a lien reserved on the face of any conveyance of real estate, or lien created by any trust deed or
mortgage on real estate, be also secured, in whole or in part, by
the same lien, such lien shall continue to be valid and binding as
a lien on such real estate for a period of twenty years from the
date on which such subsequent debt or obligation secured by such
lien becomes due, but not thereafter unless suit to enforce the
same shall have been instituted prior to the expiration of such
period. No extension of the original time of payment of such debt
or obligation, or renewal of any note or other evidence of
indebtedness secured by such lien, or provision for such extension
or renewal in such conveyance, trust deed or mortgage, shall
operate to extend the limitation of twenty years hereinbefore
provided: Provided, That the lien reserved or created as aforesaid
shall continue to be valid and be enforceable, if, prior to the
expiration of the original period of limitations, the vendor or the
mortgagee or the trustee or beneficiary, or their successors or
assigns, shall execute and cause to be recorded in the office where
the lien instrument was recorded an affidavit setting forth the
unpaid balance of the debt and interest secured by such lien
instrument. Upon the filing of such affidavit the lien of the lien
instrument shall continue and be enforceable for an additional
period of twenty years from the date of the filing of such
affidavit unless sooner released, and the clerk of the court shall
cause the extension affidavit to be recorded and indexed in the same manner as the lien instrument and shall note the fact of
filing such extension affidavit on the margin of the page where
such lien instrument is recorded. Such affidavit shall recite the
book and page of recordation of the deed, deed of trust or
mortgage. The provisions of this section shall apply, with like
effect, to every such lien now existing, as well as to every such
lien hereafter reserved or created.
(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 (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.
(b) If an affidavit or extension agreement executed by the
secured party and the grantor or mortgagor to the lien obligation is recorded prior to expiration of the original period of
limitation, as specified in subsection (a), 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, 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 is not ascertainable from the record
of the affidavit or extension agreement, 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 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 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, any action to enforce those
liens is brought or recordation of any extended lien obligation
pursuant to subsection (b) is made before the first day of July,
one thousand nine hundred ninety-eight.
(f) The time shall be extended only as provided in this
section and shall not be extended by any other method or by
operation of law.
(g) 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 change to five years from
the maturity date the statute of limitation of any lien reserved or
created by any conveyance, deed of trust or mortgage on real
estate, to provide similar limitations for extension agreements of
such liens, to provide requirements for affidavits or extension
agreements and method of recordation, to provide that the time runs on installment obligations from the date of final installment and
to provide a period during which old liens may be recorded or
enforced.
Strike-through indicate language that would be stricken from
the present law, and underscoring indicates new language that would
be added.
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