IN THE SUPREME COURT OF APPEALS OF WEST VIRGINIA
January 2003 Term
May 6, 2003
RORY L. PERRY II, CLERK
SUPREME COURT OF APPEALS
OF WEST VIRGINIA
JAMES DUNLAP AND STEPHANIE GIBSON,
ON BEHALF OF THEMSELVES AND
ALL OTHERS SIMILARLY SITUATED,
Plaintiffs Below, Appellants
FRIEDMAN’S, INC., dba FRIEDMAN’S JEWELERS,
A DELAWARE CORPORATION,
AMERICAN BANKERS INSURANCE COMPANY OF FLORIDA, INC.,
AMERICAN BANKERS LIFE ASSURANCE COMPANY OF FLORIDA,
ALAN HOPKINS, WILLIAM PERRY, NANCY TANOUKHI,
ROY BATSON, JOHN DOE AND JANE DOE,
Defendants Below, Appellees
Appeal from the Circuit Court of Kanawha County
The Honorable Irene C. Berger, Judge
Civil Action No. 00-C-1155
Submitted: April 15, 2003
Filed: May 6, 2003
David L. Grubb
Grubb Law Group
Charleston, West Virginia
John W. Barrett
P. Michel Pleska
Bowles Rice McDavid Graff & Love, PLLC
Charleston, West Virginia
Attorney for the Appellee,
Barrett Law Firm, PLLC
Charleston, West Virginia
Brian A. Glasser
Bailey & Glasser, LLP
Charleston, West Virginia
Spilman, Thomas & Battle, PLLC
Charleston, West Virginia
Attorney for the Appellees,
American Bankers Insurance Co., et al.
Attorneys for the Appellant,
JUSTICE ALBRIGHT delivered the Opinion of the Court.
CHIEF JUSTICE STARCHER concurs and reserves the right to file a concurring opinion.
JUSTICE DAVIS and JUSTICE MAYNARD dissent and reserve the right to file dissenting opinions.
SYLLABUS BY THE COURT
1. “Appellate review of a circuit court’s order granting a motion to dismiss a complaint is
de novo.” Syl. Pt. 2, State ex rel. McGraw v. Scott Runyan Pontiac-Buick, Inc., 194 W. Va.
770, 461 S.E.2d 516 (1995).
2. “Where the issue on an appeal from the circuit court is clearly a question of law or
involving an interpretation of a statute, we apply a de novo standard of review.” Syl. Pt. 1, Chrystal
R.M. v. Charlie A.L., 194 W. Va. 138, 459 S.E.2d 415 (1995).
3. “Judicial interpretation of a statute is warranted only if the statute is ambiguous and the
initial step in such interpretative inquiry is to ascertain the legislative intent.” Syl. Pt. 1, Ohio County
Comm'n v. Manchin, 171 W. Va. 552, 301 S.E.2d 183 (1983).
4. “A statute that is ambiguous must be construed before it can be applied.” Syl. Pt. 1,
Farley v. Buckalew, 186 W. Va. 693, 414 S.E.2d 454 (1992).
5. “A statute, or an administrative rule, may not, under the guise of ‘interpretation,’ be
modified, revised, amended or rewritten.” Syl. Pt. 1, Consumer Advocate Division v. Public
Service Comm’n, 182 W. Va. 152, 386 S.E.2d 650 (1989).
6. West Virginia Code § 46A-5-101(1) (1996) (Repl. Vol. 1998) is a remedial statute
to be liberally construed to protect consumers from unfair, illegal, or deceptive acts. In face of the
ambiguity found in that statute, a consumer who is party to a closed-ended credit transaction, resulting from
a sale as defined in West Virginia Code § 46A-6-102(d), may bring any necessary action within either the
four-year period commencing with the date of the transaction or within one year of the due date of the last
payment, whichever is later.
This is an appeal by Stephanie Gibson and James Dunlap1 (hereinafter “Appellants”) from
a final order of the Circuit Court of Kanawha County dismissing Consumer Credit and Protection Act
(hereinafter “CCPA”) claims for failure to file a complaint within the applicable statute of limitations period.
On appeal, the Appellants assert that the lower court erred in finding that the applicable statute of limitations
period was one year from the date of the last payment due; rather, the Appellants contend that the
applicable statute of limitations period is four years from the date of the alleged violation.
I. Factual and Procedural History
On December 12, 1997, Appellant Stephanie Gibson purchased an item of jewelry from
Friedman’s Inc., doing business as Friedman’s Jewelers (hereinafter “Friedman’s”). The jewelry was
priced at $949.00. With tax and “other charges,” the total amount of the transaction was $1,156.62.
Financing was accomplished through aretail installment sales contract requiring fifteen monthly payments
beginning on January 1, 1998, and ending on February 25, 1999. With the addition of financing charges,
the total sale price was $1,268.84. It is the imposition of the “other charges” that the Appellants attempted
to challenge through the civil action. These “other charges” included $8.55 for credit life insurance, $22.45
for credit disability insurance, and $40.08 for property insurance, totaling $71.08 for all three insurance
In State ex rel. Dunlap v. Berger, 211 W. Va. 549, 567 S.E.2d 265 (2002), cert.
denied, Friedman’s, Inc. v. West Virginia ex rel. Dunlap, 123 S.Ct. 695 (2002), this Court
reversed the lower court’s order compelling arbitration of Appellant James Dunlap’s claims, holding that
exculpatory clauses in adhesion contracts are presumptively invalid.
The Appellant alleges that she was charged for these insurance products without her
knowledge or consent.2 In her complaint, filed May 4, 2000, the Appellant alleged that conduct engaged
in by Friedman’s constitutes an unfair or deceptive trade practice in violation of the CCPA and that such
conduct was part of a systematic scheme to deceive consumers and enhance business profit.3
The lower court entered an order dated September 14, 2001, granting the Appellees’
motion to dismiss the complaint based upon the lower court’s finding that the complaint had not been filed
within the applicable one year statute of limitations. On appeal, the Appellants assert that the statutorily
mandated statute of limitations for this action is actually four years from the date of the alleged violation.
II. Standard of Review
In syllabus point two of State ex rel. McGraw v. Scott Runyan Pontiac-Buick, Inc.,
194 W. Va. 770, 461 S.E.2d 516 (1995), this Court explained: “Appellate review of a circuit court’s order
granting a motion to dismiss a complaint is de novo.” The lower court’s decision to dismiss the claim in
this matter was based upon statutory interpretation, and according to syllabus point one of Chrystal R.M.
v. Charlie A.L., 194 W. Va. 138, 459 S.E.2d 415 (1995), “[w]here the issue on an appeal from the
circuit court is clearly a question of law or involving an interpretation of a statute, we apply a de novo
standard of review.” See also Ewing v. Board of Educ. of County of Summers, 202 W. Va. 228,
Ironically, because the Appellant is disabled, she is not even eligible for credit disability
TheAppellant Stephanie Gibson and co-Appellant James Dunlap filed this action on behalf
of themselves and all others similarly situated.
503 S.E.2d 541 (1998); Syl. Pt. 1, University of West Virginia Board of Trustees ex rel. West
Virginia University v. Fox, 197 W. Va. 91, 475 S.E.2d 91 (1996). In Scott Runyan, this Court also
clarified that “[a]s a result of this inquiry being strictly a matter of statutory construction, our power of
interpretive scrutiny is plenary.” 194 W. Va. at 776, 461 S.E.2d at 522.
A. West Virginia Code § 46A-5-101(1)
West Virginia Code § 46A-5-101(1) (1996) (Repl. Vol. 1998)4 provides as follows:
If a creditor has violated the provisions of thischapter applying to
collection of excess charges, security in sales and leases, disclosure with
respect to consumer leases, receipts, statements of account and evidences
of payment, limitations on default charges, assignment of earnings,
authorizations to confess judgment, illegal, fraudulent or unconscionable
conduct, any prohibited debt collection practice, or restrictions on interest
in land as security, assignment of earnings to regulated consumer lender,
securityagreementon household goods for benefit of regulated consumer
lender, and renegotiation by regulated consumer lender of loan discharged
This Court explained the intent of the West Virginia Consumer Credit and Protection Act
as follows in syllabus point three of Arnold v. United Companies Lending Corp., 204 W. Va. 229,
511 S.E.2d 854 (1998):
“‘The legislature in enacting the West Virginia Consumer Credit
and Protection Act, W.Va.Code, 46A-1-101, et seq., in 1974, sought
to eliminate the practice of includingunconscionable terms in consumer
agreementscovered by the Act. To further this purpose the legislature, by
the express language of W.Va.Code, 46A-5-101 (1), created a cause of
action for consumers and imposed civil liability on creditors who include
unconscionable termsthat violate W.Va.Code, 46A-2-121 in consumer
agreements.’ Syl. pt. 2, U.S. Life Credit Corp. v. Wilson, 171 W.
Va. 538, 301 S.E.2d 169 (1982).” Syl. pt. 1, Orlando v. Finance
One of West Virginia, Inc., 179 W. Va. 447, 369 S.E.2d 882 (1988).
in bankruptcy, the consumer has a cause of action to recover actual
damages and in addition a right in an action to recover from the person
violating this chapter a penalty in an amount determined by the court not
less than one hundred dollars nor more than one thousand dollars. With
respect to violations arising from consumer credit sales or
consumer loans made pursuant to revolving charge accounts
or revolving loan accounts, or from sales as defined in
article six [§ 46A-6-101 et. seq.] of this chapter, no action
pursuant to this subsection may be brought more than four
years after the violations occurred. With respect to
violations arising from other consumer credit sales or
consumer loans, no action pursuant to this subsection may
be brought more than one year after the due date of the last
scheduled payment of the agreement.
W. Va. Code § 46A-5-101(1) (emphasis supplied). “Sale” as defined in West Virginia Code § 46A-6102(d) “includes any sale, offer for sale or attempt to sell any goods for cash or credit or any services or
offer for services for cash or credit.”
The Appellees contend that the one-year statute of limitations applies to this cause of action
based upon the fact that this was a closed-ended contract, including fifteen payments,5 and, as such, is not
encompassed within the “revolving charge accounts or revolving loan accounts” to which the four-year
statute of limitations applies, pursuant to statute. The Appellees further contend that such application of
the statutory language is consistent with the Uniform Consumer Credit Code upon which the West Virginia
Legislatureallegedly based its provisions. The Appellees claim that the West Virginia Legislature combined
various model codes to formulate the current provision, and that it must have intended to create a statute
Because the installment sales contract envisions fifteen monthly payments, it is a closedended contract rather than an open-ended contract in which there is no fixed monthly payment required.
of limitations distinction between open-ended and closed-ended contracts. The statute, however, does not
specificallyaddress theconcept of closed-ended contracts; the Appellees only assume that the legislature’s
use of the term “other contracts” embraced closed-ended contracts. Thus, while the Appellees’ approach
presents an intriguing analytical framework, it does not definitivelyresolve the issue because the legislature
in fact enacted a statute which is different in form from the various model codes it may have relied upon in
its formulation of the present language.
The Appellants contend that this closed-ended contract is included within thedefinition of
sales, West Virginia Code § 46A-6-102(d), to which the four-year statute of limitations explicitly applies,
pursuant to statute.
B. Ambiguity of Statute
In resolving this issue raised in this appeal, we note that this Court has consistently
acknowledged that statutes of limitations serve a significant function in the operation of the law. “The basic
purpose of statutes of limitations is to encourage promptness in instituting actions; to suppress stale
demands or fraudulent claims; and to avoid inconvenience which may result fromdelay in asserting rights
or claims when it is practicable to assert them.” Morgan v. Grace Hospital, Inc., 149 W. Va. 783,
791, 144 S.E.2d 156, 161 (1965) (citations omitted). In Perdue v. Hess, 199 W. Va. 299, 484 S.E.2d
182 (1997), for instance, this Court reviewed the numerous cases in which this Court has encouraged strict
compliance with statutes of limitations as a means of requiring “the institution of a cause of action within a
reasonable time.” 199 W. Va. at 303, 484 S.E.2d at 186.
Where, however, the legislature has not expressed its intended statutes of limitation with
clarity, such a laudable goal of strict compliance is unattainable. Although this Court has invariably
recognized that clear and unambiguous statutes are not subject to interpretation,6 we have also observed:
Ambiguity is a term connoting doubtfulness, doubleness of
meaning of indistinctness or uncertainty of an expression used in a written
instrument. It has been declared that courts may not find ambiguity in
statutory language which laymen are readily able to comprehend; nor is it
permissible to create an obscurity or uncertainty in a statute by reading in
an additional word or words.
Crockett v. Andrews, 153 W. Va. 714, 718-19, 172 S.E.2d 384, 387 (1970). A finding of ambiguity
must be made prior to any attempt to interpret a statute. As the Court stated in syllabus point one of Ohio
County Comm'n v. Manchin, 171 W. Va. 552, 301 S.E.2d 183 (1983), “Judicial interpretation of a
statute is warranted only if the statute is ambiguous and the initial step in such interpretative inquiry is to
ascertain the legislative intent.” Likewise, in syllabus point one of Farley v. Buckalew, 186 W. Va. 693,
414 S.E.2d 454 (1992), this Court further explained: “A statute that is ambiguous must be construed before
it can be applied.”
Our reading of West Virginia Code § 46A-5-101(1) compels the conclusion that the
statute is ambiguous with regard to the distinction between open and closed-ended credit agreements and
the statute of limitations applicable to those two types of credit. While the statute clearly states that the
“Where the language of a statute is free from ambiguity, its plain meaning is to be accepted
and applied without resort to interpretation.” Syl. Pt. 2, Crockett v. Andrews, 153 W. Va. 714,172
S.E.2d 384 (1970). “Where the language of a statute is clear and without ambiguity the plain meaning is
to be accepted without resorting to the rules of interpretation.” Syl. Pt. 3, Francis O. Day Co., Inc. v.
Director, Div. of Envtl. Protection, 191 W. Va. 134, 443 S.E.2d 602 (1994).
four-year statute of limitations is applicable to revolving charge accounts, revolving loan accounts, and sales
as particularly defined, it also specifically subjects “other consumer credit sales or consumer loans” to a
one-year statute of limitations period. While the Appellees and lower court contend that closed-ended
credit sales must in included within “other consumer credit sales or consumer loans,” the Appellants argue
that closed-ended credit sales come within the purview of “sales” to which the four-year statute of
limitations is applicable. Both sideshave presented compelling and persuasive arguments in support of their
respective theories. Even if, however, this Court were convinced of the superiority of one theory over
another, this Court cannot substitute its own judgment for that of the legislature and significantly rewrite the
statute. If, for instance, this Court agreed with the Appellees that the most rational method of dealing with
statute of limitations issues would be to permit four years on open-ended loans, due to their longer term
nature, and only one year on closed-ended loans, due to the finality of such constructs, this Court is not
permitted to rewrite the statute to state such conclusion with clarity. The Court has expressed this
prohibition concisely on numerous occasions. In Williamson v. Greene, 200 W. Va. 421, 490 S.E.2d
23 (1997), for instance, this Court stated:
“[i]t is not for [courts] arbitrarily to read into [a statute] that which it does
not say. Just as courts are not to eliminate through judicial interpretation
words that were purposely included, we are obliged not to add to statutes
something the Legislature purposely omitted.” Banker v. Banker, 196
W.Va. 535, 546-47, 474 S.E.2d 465, 476-77 (1996) (citing Bullman
v. D & R Lumber Company, 195 W.Va. 129, 464 S.E.2d 771
Id. at 426, 490 S.E.2d at 28 (citations omitted). “A statute, or an administrative rule, may not, under the
guise of ‘interpretation,’ be modified, revised, amended or rewritten.” Syl. Pt. 1, Consumer Advocate
Division v. Public Service Comm’n, 182 W. Va. 152, 386 S.E.2d 650 (1989).
In Hereford v. Meek, 132 W. Va. 373, 52 S.E.2d 740 (1949), this Court stated: “A
statute is open to construction only where the language used requires interpretation because of ambiguity
which renders it susceptible of two or more constructions or of such doubtful or obscure meaning that
reasonable minds might be uncertain or disagree as to its meaning.” Id. at 386, 52 S.E.2d at 747. We
addressed a statute regarding annual salary increases for deputy sheriffs in Lawson v. County Comm'n
of Mercer County, 199 W. Va. 77, 483 S.E.2d 77 (1996), and found that the statute in question was
susceptible to differing constructions, to the extent that the term “receive an annual salary increase” could
mean either an increase to become part of the annual salary or an increase in addition to the annual salary.
Id. at 81, 483 S.E.2d at 81. Based upon the Court’s finding that the statute could be read by reasonable
persons to have different meanings, we found the language of the statute to be ambiguous. Id.
C. Liberal Construction of Statute
Having found West Virginia Code § 46A-5-101(1) ambiguous with regard to applicable
statute of limitations periods because it is susceptible of differing interpretations, we may proceed to
construe it pursuant to the legislative intent. In Scott Runyan, this Court specified that West Virginia
Code § 46A-5-101(1) should be construed liberally as a remedial statute. We explained: “Where an act
is clearly remedial in nature, we must construe the statute liberally so as to furnish and accomplish all the
purposes intended.” 194 W. Va. at 777, 461 S.E.2d at 523. “The purpose of the CCPA is to protect
consumers from unfair, illegal, and deceptive acts or practices by providing an avenue of relief for
consumers who would otherwise havedifficulty proving their case under a more traditional cause of action.”
Furthermore, this Court explained in Appalachian Power Co. v. State Tax Dept. of
West Virginia, 195 W. Va. 573, 466 S.E.2d 424 (1995), that absent explicatory legislative history for
an ambiguous statute, a court construing such a statute must consider the “overarching design of statute.”
Id. at 587, 466 S.E.2d at 438, quoting Scott Runyon, 194 W. Va. at 777, 461 S.E.2d at 523. In
construing the statute liberally to protect all consumers from unfair, illegal, or deceptive action, and in
considering the overarching design of the statute, we are compelled to resolve the issue this ambiguity has
created by concluding that the credit sale utilized in this transaction is included within the four-year statute
of limitations applicable to “consumer credit sales or consumer loans made pursuant to revolving charge
accounts or revolving loan accounts, or from sales. . . .” W. Va. Code § 46A-5-101(1). While such
determination admittedly doesnot effectively answer the myriad of hypotheticals raised by the parties with
regard to various types of credit sales utilized by consumers and the issue of into which statutorilydesignated category such transactions may fall, the liberal construction to which this statute is entitled
compels our conclusion that any doubt about this particular transaction’s inclusion within the more liberal
four-year statute of limitations period be resolved in favorof such inclusion. Similarly, a consumer who is
party to a longer-term, closed-ended transaction is also entitled to maintain an action within one year of the
due date of the last payment.
After thorough review, this Court concludes that West Virginia Code § 46A-5-101(1) is
a remedial statute to be liberally construed to protect consumers from unfair, illegal, or deceptive acts. In
face of the ambiguity found in that statute, a consumer who is party to a closed-ended credit transaction,
resulting from a sale as defined in West Virginia Code § 46A-6-102(d), may bring any necessary action
within either the four-year period commencing with the date of the transaction or within one year of the due
date of the last payment, whichever is later.
Based upon the foregoing, we reverse the decision of the Circuit Courtof Kanawha County
and remand this matter for further proceedings consistent with this opinion.
Reversed and remanded.