HUNTINGTON — A woman is suing James B. Nutter & Company for harm she sustained due to her late husband's fraud.
Tammy Johnson filed the lawsuit against Nutter, Reverse Mortgage Funding LLC and Terra Abstract Trustee West Virginia Inc., according to a complaint initially filed in Wayne Circuit Court and later removed to U.S. District Court for the Southern District of West Virginia.
Johnson is a disabled woman whose spouse passed away in 2014. She and her husband purchased a new double-wide Clayton manufactured home from Keene Family Owned Home in 2007.
Without her knowledge, her husband obtained a reverse mortgage loan from Nutter, naming him as the sole borrower in 2008 and that loan is secured by a deed of trust on the real estate upon which the manufactured home now sits, according to the suit.
Johnson claims she did not learn about the loan until her husband's death.
"Had she known of (the reverse mortgage) in 2008 and been asked to consent, Plaintiff would not have consented to Archie Johnson's obtaining a reverse mortgage on their home because it could result in the loss of her home when Mr. Johnson died, leaving the younger Plaintiff homeless," the complaint states.
Johnson claims as the non-borrowing spouse, she applied to Nutter to continue the reverse mortgage credit transaction and extend the maturity of the reverse mortgage loan until her own death or sale or abandonment of the home, but Nutter wrongly failed and refused to approve or determine Johnson's application.
The plaintiff's manufactured home suffered storm damages in July 2018 and Johnson reached out to State Farm and the insurance company determined the property suffered approximately $10,500 in storm damages. State Farm approved a payment of $9,293.62 under the policy so that the plaintiff could repair the home to alleviate danger and protect the interior of the home from future damage.
Nutter then demanded State Farm issue the insurance proceeds check for the repairs to the plaintiff's manufactured home jointly in its name, even though the plaintiff never granted Nutter a lien or other security interest in the manufactured home she owns.
Johnson claims Nutter lacked a valid claim or right to the proceeds of the individual insurance policy. She claims Nutter then converted the insurance check and refused to release the proceeds as requested so the plaintiff could make repairs on her home.
The plaintiff alleges Nutter then created an impossible barrier to repairing the home and she faces irreparable harm for which she lacks an adequate remedy at law.
Johnson is seeking the court to relieve her of the effect of her late husband's fraud. She is represented by Gary M. Smith of Mountain State Justice.
U.S. District Court for the Southern District of West Virginia Case number: 3:19-cv-00856