wvlegal reports an improperly recorded financing statement issued by the Gilmer County Clerk’s Office led to a bank being co-defendant in a lawsuit brought against two modular home builders in March 2010. Modular builder New Horizon Home Sales of Athens, WVa, and Gilmer Housing Partners (GHP) allegedly defaulted on a 2005 real estate loan from Textron Financial Corporation, of Providence, Rhode Island. Three years later New Horizon sought funding from Summit Bank, and due to a defective Uniform Commercial Code fixture filing in the clerk’s office, New Horizon was not listed as a co-debtor in the lawsuit. Summit sued the clerk’s office for all legal costs incurred in defending itself from Textron, and a tentative settlement, though undisclosed, has been reached. The same court granted Textron’s motion for summary judgment March 15 against New Horizon, requiring them to pay the entire judgment plus .25 percent interest, and return one of the properties.
(Photo credit: Lawrence Smith)