CHARLESTON -– At the center of the struggle between borrowers and lenders in West Virginia, justice has parked a motorcycle.
On April 12, in a case about a Suzuki, the Supreme Court of Appeals will hear arguments over whether to define debt collectors as creditors.
The Justices didn't volunteer to solve the riddle, taking it instead by certificate from U.S. District Judge John Preston Bailey in Martinsburg.
Bailey must rule on a motion from NCB Management Services to dismiss a harassment suit of borrower Linda Barr. She claimed standing to sue under state law regulating creditors, and NCB answered that the law doesn't apply to debt collectors.
NCB argued that only the state attorney general can sue a collector.
Bailey tried to interpret West Virginia law, but chose to ask the Justices for help.
NCB wondered in response how it could understand the law if Bailey couldn't.
Friends of the court point out that a decision will shape collection practices for home mortgages and credit cards.
For Mountain State Justice, Bren Pomponio of Charleston wrote that restricting the law as NCB suggests would leave the door open for abusive loan servicers.
"The only recourse for hundreds of borrowers facing losing their homes who seek legal assistance from Mountain State Justice is private enforcement of the West Virginia Credit Consumer Protection Act," he wrote.
American Association of Retired Persons, National Association of Consumer Advocates, and National Consumer Law Center called for the case to continue.
"Out of necessity and in rapidly increasing numbers, people are using high cost credit cards to pay for expenses of daily living such as groceries, medical care, prescription drugs, house payments, and urgent house repairs," Brett Preston of Charleston wrote.
"Older persons are particularly vulnerable to abusive debt collection practices," he wrote.
He wrote that under NCB's interpretation, a debt collector could repeatedly telephone a widow on Christmas, use obscene language, and threaten her, all without remedy.
Attorney General Darrell McGraw sees no difficulty in reading the law.
His deputy, Jill Miles, wrote that a consumer's right to sue on his own behalf is a key element of statutes against unfair and deceptive acts and practices.
She wrote that "limited state consumer protection enforcement budgets are not able to police the marketplace fully."
"Enforcement of a regulatory statute through individual actions serves a deterrent effect, curbing impermissible conduct by unscrupulous businesses," Miles wrote.
She wrote that in McGraw's consumer protection division, six attorneys sift through more than 10,000 written complaints each year and decide which ones merit scrutiny.
For NCB, Bryan Shartle of Metairie, Louisiana, wrote that the disputed provision doesn't even mention debt collectors.
"It is true that the WVCCPA is a remedial statute, which should be liberally construed," he wrote. "However, a liberal construction of the statute does not grant the Court unbridled discretion and power to rewrite the statute."
He wrote that regardless of the answer to Bailey's question, federal and state laws will continue to bind debt collectors.
Failure to follow the laws will subject collectors to prosecution by the attorney general for injunctions, penalties, and loss of license, he wrote.
"Considering a federal judge as experienced and knowledgeable as Chief Judge Bailey could not discern the current state of law, it is unreasonable to expect NCB to know," he wrote.
Macel Rhodes of Morgantown, Patrick McDermott of Wheeling, and Sharon Hall of Pittsburgh also represent NCB.
John Barrett and Jonathan Marshall, both of Bailey and Glasser in Charleston, Aaron Amore of Charles Town, and Anthony Majestro of Charleston represent Barr.