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STATE OF WEST VIRGINIA

SUPREME COURT OF APPEALS

Kourt Security Partners, LLC,

Defendant Below, Petitioner

vs.) No. 19-0395 (Monongalia County 15-C-733)

United Bank, Inc.,

Plaintiff Below, Respondent

MEMORANDUM DECISION

Petitioner Kourt Security Partners, LLC, by counsel Charles J. Kaiser Jr. and Jeffrey D. 

Kaiser, appeals the circuit court’s “Order Granting [Respondent United Bank, Inc.’s] Motion to 

Secure Loan Collateral and Denying [Petitioner’s] Motion for Rule 60 Relief.” Respondent United 

Bank, Inc., by counsel Shawn P. George and Jennie Ovrom Ferretti, submitted a response to which 

petitioner submitted a reply.

This Court has considered the parties’ briefs and the record on appeal. The facts and legal 

arguments are adequately presented, and the decisional process would not be significantly aided 

by oral argument. Upon consideration of the standard of review, the briefs, and the record 

presented, the Court finds no substantial question of law and no prejudicial error. For these reasons, 

a memorandum decision is appropriate under Rule 21 of the Rules of Appellate Procedure.

Respondent United Bank, Inc. (“United”) filed the underlying action on November 13, 

2015, seeking an order finding petitioner Kourt Security Partners, LLC (“Kourt”) then-owed 

United $737,310.42, together with pre- and post-judgment interest, late fees, costs, expenses, and 

attorney’s fees related to the default by MB Security, LLC, on two loans from United totaling 

$827,000 in principal amount (“loans”). According to the circuit court, United sued Kourt because 

it purchased the collateral that was pledged as security for the loans from Betty Parmer at a private 

sale. Per United the assets included the former assets of Secure US, in which United claimed a 

perfected first priority security interest. Kourt filed an answer, denying that United’s lien survived 

the private sale; extended to any asset of Secure US, including customer contracts, renewals 

thereof, or proceeds therefrom; or that United was entitled to any of the collateral. 

United; MB Security; Secure US; and Betty Parmer, individually, and by way of power of 

attorney given to her nephew, Mitchell Brozik, under a management agreement, entered into 

various agreements regarding the loans and the security pledged to them. The circuit court found 

that the agreements include the loan agreements; promissory notes; pledge and security 

FILED

May 26, 2020

EDYTHE NASH GAISER, CLERK

SUPREME COURT OF APPEALS

OF WEST VIRGINIA
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agreements; the hypothecation agreement;1the management agreement between Betty Parmer, 

Secure US, and MB Security; and financing statements (“loan documents”). According to the 

circuit court, the loan documents have been the subject of several legal actions and proceedings 

“and all are of record [with the circuit court]. There has never been alleged or found any ambiguity 

in any of the [l]oan [d]ocuments.” 

The circuit court also found that “Kourt admits that United holds a valid, enforceable firstpriority security interest in the [c]ollateral identified in the loan documents. However, Kourt 

disputes that United’s right in the [c]ollateral includes the Secure US customer contracts, any post 

sale renewals or extensions thereof or proceeds therefrom.” It further found that based upon the 

evidence contained in the record, since the private sale, Kourt has received over $4.2 million in 

revenue from the contracts at a rate of approximately $140,000 per month. However, Kourt 

asserted that paragraph 12.C. of the September 21, 2012, promissory note and security agreement, 

which defines property subject to the security agreement, does not include the customer contracts, 

renewals, and proceeds therefrom.2 The court found the January 23, 2013, commercial security 

agreement relevant because it expressly incorporates the provisions of related documents, 

including all promissory notes, security agreements, and the hypothecation agreement executed in 

connection with it.

After the default and United’s demand to Kourt to turn over the collateral or pay the default 

indebtedness, Kourt turned over the vehicles owned by Secure US, which were a part of the 

collateral to which United’s first priority lien interest attached, and United reduced the outstanding 

principal due on the loans accordingly. However, Kourt refused to pay the balance due or owing 

or to produce the remaining collateral to United, claiming that United had no legal right to the 

balance or the collateral. United filed the underlying action in 2015, and on April 8, 2016, United 

filed a motion for summary judgment before the circuit court. By order entered on November 28, 

2016, the circuit court granted United’s motion, finding that United had a perfected first priority 

security interest in the collateral, which survived the private sale by Betty Parmer to Kourt of all 

the assets of Secure US. Kourt appealed that order to this Court, and this Court affirmed that order 

in Kourt Security Partners, LLC v. United Bank, Inc., No. 16-1206, 2018 WL 1225516 (W. Va. 

Mar. 9, 2018) (memorandum decision) (“Kourt I”). 

 

1Hypothecation is “[t]he pledging of something as security without delivery of title or 

possession.” Black’s Law Dictionary 892 (11th ed. 2019).

 

2 The paragraph at issue provides as follows:

(2) Accounts and Other Rights to Payment. All rights I have now or in the future 

to payments including, but not limited to, payment for property or services sold, 

leased, rented, licensed, or assigned, whether or not I have earned such payment by 

performance. This includes any rights and interests (including all liens and security 

interests) which I may have by law or agreement any Account Debtor or obligor of 

mine.
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On March 7, 2017, United filed a motion for issuance of a writ of fieri facias.3 Kourt 

opposed that motion, asserting that the summary judgment order was not a “judgment for money” 

so fieri facias was not appropriate relief. United made additional demands for payment and 

satisfaction of the defaulted loans, but Kourt refused to pay. United served discovery on Kourt and 

subpoenaed the production of various records regarding the collateral, which Kourt produced. 

United also deposed Kourt’s corporate representative, Patrick Egan. Kourt produced and Mr. Egan 

testified regarding a confidential list of Secure US contracts acquired by Kourt. However, Kourt 

refused United’s demand for the production of the contracts. 

On December 20, 2018, United filed a motion to secure the loan collateral, and the circuit 

court scheduled a hearing on that motion for January 9, 2019. On January 2, 2019, Kourt filed its 

Rule 60(b)(6)4 motion to clarify or supplement, more than two years after the entry of the summary 

judgment order. United filed an expedited response to which Kourt filed a reply. Following the 

January 9, 2019, hearing, the circuit court entered its “Order Granting [Respondent’s] Motion to 

Secure Loan Collateral and Denying [Petitioner’s] Motion for Rule 60 Relief.” 

In that order, the circuit court found that United had consistently asserted its right in and to 

the collateral, which secured the defaulted loans. It determined that Kourt conceded that it owns 

and controls various customer contracts from hundreds of people and businesses as a result of the 

Secure US private sale and that the value of those customer contracts and the monthly recurring 

revenue exceeds the money owed to United on the defaulted loans. It also found there is a 

marketplace of willing buyers for those customer contracts. However, Kourt argued that United’s 

interest in the collateral does not extend to the customer contracts, the subsequent renewals and/or 

extensions thereof, or the proceeds therefrom, based upon Kourt’s interpretation of the loan 

documents. The circuit court determined that United is entitled to the collateral under the express 

language of the loan documents and “[n]othing in Kourt’s Rule 60(b)(6) motion alters this 

conclusion or supports a different result.” It also found that the only Secure US assets with 

significant value are and have always been the customer contracts or accounts. “There is no dispute 

about this, nor basis to carve them out of the [c]ollateral for the MB Security Loans.” The circuit 

court held that the loan documents specifically incorporate the “Accounts and Rights to 

Payments,” including, but not limited to, the promissory notes and security agreements, which 

reference “payment intangible” and “proceeds,” all of which refute any such construction or 

contrary result.

With regard to petitioner’s Rule 60(b)(6) motion, the circuit court found that it was not 

supported by the facts or record. Because the 

 

3A writ of fieri facias is “[a] writ of execution that directs a marshal or sheriff to seize and 

sell a judgment debtor's property to satisfy a money judgment[.]” Black’s Law Dictionary 771

(11th ed. 2019). 

4Rule 60(b)(6) of the West Virginia Rules of Civil Procedure provides as follows: “On 

motion and upon such terms as are just, the court may relieve a party or a party’s legal 

representative from a final judgment, order, or proceeding for the following reasons: . . . . (6) any 

other reason justifying relief from the operation of the judgment.”
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basis of the motion was never previously asserted at any time during the three (3) 

year pendency of [the underlying] action, nor on appeal to [this Court]. It is 

therefore not filed within a reasonable time as required under the Rule. The motion 

also fails to allege “any other reason justifying relief from the operation of the 

judgment” as required under the Rule. 

It further found that the motion’s legal argument was flawed and unpersuasive because “Accounts 

and Other Rights to Payment” are listed as collateral in the promissory note and security agreement 

governing the loans and confirmed by both the hypothecation and management agreements. 

According to the circuit court, 

[a]ll parties, including Kourt and Mr. Egan, who managed Secure US for Mrs. 

Parmer for a period after Mr. Brozik and MB Security were removed as managers, 

knew, understood and testified in various legal proceedings surrounding Secure US, 

Mrs. Parmer and Mr. Brozik that MB Security, LLC was a management company. 

It had no customer accounts of its own. The customer accounts it managed, received 

payments on and pledged to United on the Loans were the customer accounts of 

Secure US. [It also found that those are the] very same accounts Kourt purchased 

from Mrs. Parmer at private sale, and renewed, extended or re-signed on which 

Kourt has received $4.2 million since the sale, or an average of approximately 

$140,000.00 per month . . . Throughout this time, the [c]ollateral was subject to 

United’s first priority perfected security interest. These are the same customer 

accounts that MB Security LLC pledged to United under the Promissory Notes and 

Security Agreements, by authority of the Management Agreement and which the 

Hypothecation Agreement ratified and confirmed. 

The circuit court determined that the case does not present the “extraordinary 

circumstances” necessary to invoke Rule 60(b)(6), as it is a simple case of a borrower pledging all 

the assets of a business to secure a bank loan. Here, the borrower defaulted, Kourt purchased the 

assets, and the assets are subject to United’s lien. The circuit court further found that

it would be unfair and unreasonable to permit Kourt [to] attack the [s]ummary 

[j]udgment [o]rder now. The record suggests Kourt has stalled and frustrated for 

Kourt’s sole benefit and to United’s substantial detriment, possession of the 

[c]ollateral for several years and delayed the turnover to United of [c]ollateral to 

which United is entitled. . . . The [c]ourt also finds that the argument put forth in 

Kourt’s Rule 60(b)(6) motion is time barred. It should have been asserted in 

[petitioner’s] [a]nswer to the [c]omplaint, or in Kourt’s appeal of [the circuit 

court’s] ruling that United holds a first-priority security interest in and to all the 

Secure US assets. Kourt never did so.

(Emphasis in original.) Further, the circuit court found that petitioner’s argument that the West 

Virginia Uniform Commercial Code supports its theory that an interest in general intangibles does 

not include an interest in accounts “has no application here as it ignores and is at direct odds with 

the express language of the [l]oan [d]ocuments, which control.” 
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The circuit court granted United’s motion to secure loan collateral and denied Kourt’s Rule 

60(b)(6) motion. Kourt was ordered to turn over and deliver to United’s counsel all customer 

contracts set forth in Exhibit 2 to the 30(b)(7) representative’s deposition and all cash proceeds 

therefrom in satisfaction of the defaulted loans. “Upon sale or other satisfaction by United Bank 

of the defaulted loan indebtedness, United Bank is required to return to Kourt such of the customer 

contracts and proceeds therefrom as are not necessary to satisfy the defaulted loan indebtedness.” 

Petitioner appeals from that March 19, 2019, order.

On appeal, petitioner sets forth three assignments of error: (1)the circuit court’s March 19, 

2019, order is erroneous and should be reversed because the court incorrectly analyzed and applied 

the law surrounding the incorporation by reference doctrine to incorporate the terms and conditions 

of various loan documents into the hypothecation agreement security agreement – pledge and 

commercial security agreement executed by Betty Parmer; (2) the circuit court’s March 19, 2019, 

order is erroneous and should be reviewed de novo and reversed because the circuit court failed to 

ensure a proper record had been developed which would support that order’s legal and factual 

conclusions; and (3) the circuit court’s March 19, 2019, order is erroneous and should be reviewed 

de novo and reversed because the court failed to set forth adequate findings of fact and conclusions 

of law supported by the case record.

At the outset, we look to our decision in Kourt I, wherein we stated that

[i]n August and September of 2012, MB Security and Mr. Brozik obtained two 

loans from United Bank, totaling $827,000, that are relevant to the present case. 

First, they refinanced a $150,000 vehicle loan. This loan was secured by vehicles 

already owned or subsequently used in the Secure US business. In the second loan, 

Mr. Brozik and MB Security borrowed $677,000 from United Bank to satisfy 

existing creditors and supply working capital for the business. This latter loan was 

allegedly secured by the Secure US assets, as evidenced by agreements signed by 

Mr. Brozik as Ms. Parmer’s power of attorney.

Id. at *2. Further, we agreed with the circuit court that

between the time Ms. Parmer bought the assets in May of 2012 and her sale to 

Kourt Security in November of 2014, MB Security borrowed $827,000 from United 

Bank, pledging the assets as collateral; that Kourt Security was aware of United 

Bank’s loans to MB Security; that United Bank had a perfected security interest in 

and to all of the assets at the time of the sale to Kourt Security; and United Bank 

never sold or transferred its interest. 

Id. at *4.

With regard to petitioner’s first assignment of error, which addresses incorporation by 

reference, petitioner contends that in its March 19, 2019, order, the circuit court relies almost 

entirely on the “incorporation by reference” language in the Parmer documents to support its 

holding that United’s security interest covers not just all of the assets set forth therein but also all 

of the assets described within MB Security’s loan documents. However, that order fails to set forth 
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any legal support for that finding. Further, the circuit court fails to make the necessary findings to 

satisfy State ex rel. U-Haul Co. of West Virginia v. Zakaib, 232 W. Va. 432, 752 S.E.2d 586 (2013). 

Petitioner contends that not only is the order “entirely lacking any reference to the elements 

required for proper incorporation by reference, it fails to state any factual findings or cite any 

applicable evidence which would satisfy these elements. . . . This omission justifies reversal of the 

March 19, 2019[, o]rder.” 

Petitioner further contends that the language used by United in the Parmer documents tries 

to work as a catch-all provision to incorporate every possible loan and loan document that in any 

way related to MB Security and/or the loans. It argues that this is “not a legally enforceable 

incorporation by reference as it fails to satisfy the ‘make a clear reference to the other documents 

so that the parties’ assent to the reference is unmistakable’ and the ‘describe the other document 

in such terms that its identity may be ascertained beyond doubt’ requirements.”

We agree with United that petitioner seeks to improperly stand in the shoes of Betty Parmer 

to alter her intent. This Court previously considered the loans underlying this matter in Brozik v. 

Parmer, Case Nos. 16-0292, 16-0400, and 16-0238, 2017 WL 65475 (W. Va. Jan. 16, 2017) 

(memorandum decision). As we set forth in that decision, in the underlying action in Case No. 16-

0238, Ms. Parmer

alleged that, without her knowledge, United Bank loaned an additional $827,000 to 

MB Security pursuant to the management agreement and took as collateral the 

former Secure US assets she owned. However, Ms. Parmer admitted that she signed 

the management agreement [and] that she contacted United Bank to originate the 

loan; . . . By order entered on February 12, 2016, the circuit court granted United 

Bank’s motion for summary judgment.

Id. at *5-6.

5 After considering all of the loan documents and arguments regarding those loans 

presented to this Court, we affirmed the grant of summary judgment to United. Id. at *18. Both 

the circuit court and this Court clearly recognized that the collateral to secure United’s loan were 

the “former Secure US assets” Ms. Parmer owned. It is disingenuous for petitioner to now attempt 

to argue what is clearly the most valuable assets it possesses, the customer contracts, were not 

included in the collateral for that loan. 

 

5We are also mindful of our previous finding that 

[t]he evidence revealed that Mr. Brozik caused his aunt to become the owner of his 

company’s assets as part of a scheme to avoid paying a lawful judgment obtained 

by a competing security company, SAFE. He formed another company, MB 

Security, in order to use the former Secure US assets and to continue doing business 

as usual, without any regard for the duty owed to his aunt who assisted him.

Brozik v. Parmer, Nos. 16–0292, 16–0400, and 16–0238, 2017 WL 65475 at *9 (W. Va. Jan. 16, 

2017) (memorandum decision).
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In the law of contracts, parties may incorporate by reference separate 

writings together into one agreement. However, a general reference in one writing 

to another document is not sufficient to incorporate that other document into a final 

agreement. To uphold the validity of terms in a document incorporated by 

reference, (1) the writing must make a clear reference to the other document so that 

the parties' assent to the reference is unmistakable; (2) the writing must describe 

the other document in such terms that its identity may be ascertained beyond doubt; 

and (3) it must be certain that the parties to the agreement had knowledge of and 

assented to the incorporated document so that the incorporation will not result in 

surprise or hardship.

Syl. Pt. 2, State ex rel. U-Haul Co. of West Virginia at 434, 752 S.E.2d at 589. In addressing our 

holding in U-Haul, this Court summarized the following relevant facts:

U-Haul’s customers would be presented with a one-page, pre-printed rental 

contract, which the customers would sign below a line that provided: “I

acknowledge that I have received and agree to the terms and conditions of this

Rental Contract and the Rental Contract Addendum.” [U-Haul] at 436, 752

S.E.2d at 590. For those customers using interactive electronic terminals for the 

rental transaction, after proceeding through a series of screens that required the 

customer to click “Accept” before the next screen with rental terms would appear, 

the customer would reach a final screen that said, “By clicking Accept, I agree to

the terms and conditions of this Rental Contract and Rental Contract

Addendum.” Id. at 437, 752 S.E.2d at 591. Regardless of whether a customer 

received the pre-printed or electronic rental agreement, the customer was not 

presented with the addendum containing the arbitration provision prior to signing 

the rental agreement.

G&G Builders, Inc. v. Lawson, 238 W. Va. 280, 284, 794 S.E.2d 1, 5 (2016) (emphasis in original).

In the instant case, the hypothecation agreement incorporates by reference “all promissory 

notes, security agreements, mortgages, deeds of trust, business loan agreements, construction loan 

agreements, resolutions, guaranties, environmental agreements, subordination agreements, 

assignments, and any other documents or agreements executed in connection with either the 

[l]oans or this [h]ypothecation [a]greement, or both, whether now or hereafter existing.” As the 

circuit court noted in its order, the Commercial Security Agreement, dated January 23, 2013, 

expressly incorporates the provisions of related documents, including all promissory notes and 

security agreements executed in connection with it. Unlike the arbitration agreement in U-Haul, 

there is no question that Ms. Parmer, or any other borrower, was presented with and signed the 

promissory notes and additional loan documents at issue. Under the facts of this case, it is clear 

that the borrowers, whose shoes petitioner stands in now, knew or should have known the terms 

of the loan documents at issue. Therefore, we find no merit in petitioner’s first assignment of error. 

The second and third assignments of error center on the substance of the circuit court’s 

order, particularly the record before the circuit court and the court’s findings of fact and 

conclusions of law. Petitioner argues that the most material omission within the circuit court’s 
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order is the “complete lack of factual and/or legal analysis” regarding the contracts at issue and 

how the West Virginia UCC would categorize them. It contends that the lack of analysis is 

compounded by the fact that there are no customer contracts or even sample contracts contained 

in the record. According to petitioner, the “deficient record constitutes reversible error and 

warrants reversal” of the circuit court’s order. Petitioner further asserts that the circuit court order 

does not contain appropriate findings of fact and conclusions of law as mandated by Rule 52(a) of 

the West Virginia Rules of Civil Procedure. In support of that contention, petitioner argues that 

that order sets forth numerous conclusory statements with no citation to the record or applicable 

law.

Rule 52(a) of the West Virginia Rules of Civil Procedure provides, in relevant part, as 

follows:

In all actions tried upon the facts without a jury or with an advisory jury, the court 

shall find the facts specially and state separately its conclusions of law thereon, and 

judgment shall be entered pursuant to Rule 58; . . . Findings of fact, whether based 

on oral or documentary evidence, shall not be set aside unless clearly erroneous, 

and due regard shall be given to the opportunity of the trial court to judge the 

credibility of the witnesses.

West Virginia Code § 46-9-607(a) allows a secured party, such as United, to take certain 

actions, including:

(a) Collection and enforcement generally. -- If so agreed, and in any event after 

default, a secured party:

(1) May notify an account debtor or other person obligated on collateral to make 

payment or otherwise render performance to or for the benefit of the secured party;

(2) May take any proceeds to which the secured party is entitled under section 9-

315;

(3) May enforce the obligations of an account debtor or other person obligated on 

collateral and exercise the rights of the debtor with respect to the obligation of the 

account debtor or other person obligated on collateral to make payment or 

otherwise render performance to the debtor, and with respect to any property that 

secures the obligations of the account debtor or other person obligated on the 

collateral; . . . .

In addition, 

(b) When commingled proceeds identifiable. Proceeds that are commingled with 

other property are identifiable proceeds:

(1) If the proceeds are goods, to the extent provided by section 9-336; and

(2) If the proceeds are not goods, to the extent that the secured party identifies the 

proceeds by a method of tracing, including application of equitable principles, that 

is permitted under law other than this article with respect to commingled property 

of the type involved.
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W. Va. Code § 46-9-315(b). 

In its prior summary judgment order, which was affirmed by this Court, the circuit court 

found that “United [] had a perfected security interest in and to all Secure US assets at the time 

Ms. Parmer sold the assets to Kourt [].” In its motion to secure loan collateral, United argued that 

there is “no doubt Kourt owes United these amounts immediately and that failing payment, United 

is entitled to the assets securing the obligations to United may be paid in full.” Contrary to Kourt’s 

argument, the circuit court’s eleven-page order addresses multiple cases, statutes, and rules, 

including discussing this Court’s earlier findings in Brozik v. Parmer. It also relied upon numerous 

documents; those documents included exhibits to the deposition of Kourt’s corporate 

representative, the loan documents, an exhibit to a motion, and the breadth of materials considered

by the circuit court in reaching its earlier findings, including its summary judgment order. This 

Court has long held that “[t]he purpose of [] Rule [52] is to enable an appellate court to apply the 

law to the facts upon the review of such a case, and it has been held that a case may be remanded 

where the rule has not been complied with.” Blevins v. May, 158 W. Va. 531, 533, 212 S.E.2d 85,

86 (1975) (citations omitted). Based upon the circuit court’s order and the long history of this

dispute, which includes numerous findings of fact and conclusions of law by federal courts, the

circuit court, and this Court, the circuit court’s order satisfied Rule 52.

For the foregoing reasons, we affirm.

Affirmed.

ISSUED: May 26, 2020

CONCURRED IN BY:

Chief Justice Tim Armstead

Justice Elizabeth D. Walker

Justice Evan H. Jenkins

Justice John A. Hutchison 

NOT PARTICIPATING:

Justice Margaret L. Workman