Miller v. Wesbanco Bank, Inc. and Wesbanco Bank, Inc. v. Miller
West Virginia Supreme Court | 2021
What This Case Means for Subcontractors
A West Virginia court ruled on a construction loan dispute between homeowners and a bank. The court held that lenders can condition fund advances on receipt of executed lien waivers and satisfactory inspections. The decision clarifies that multiple loan documents must be read together as one agreement, and parol evidence can explain ambiguous terms. For subcontractors, this means lenders have strong contractual grounds to withhold payment until lien waivers are provided.
Key Takeaways
- •Lenders can legally require executed lien waivers before releasing construction funds—this is enforceable under West Virginia law
- •Multiple loan documents (promissory note, mortgage, construction agreement) are interpreted as a single transaction, so review all related paperwork together
- •Ambiguous loan terms can be clarified using parol evidence (oral testimony, emails, prior discussions), so document all communications with lenders about payment conditions
Lender shall be under no obligation to advance funds until Lender has obtained satisfactory inspection and executed Waiver of Liens.
Frequently Asked Question
Can a lender refuse to pay out construction loan money until I sign a lien waiver?
Yes, under West Virginia law. Lenders can make fund advances conditional on receiving a satisfactory inspection and an executed lien waiver. This is a standard contractual right. Make sure you understand these conditions before signing the loan documents, and negotiate the timing and scope of waivers upfront.
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