July 21, 2019

Tenth Circuit: District Court Properly Dismissed Complaint for Failure to Exercise Rescission Rights Within Three-Year Response Period

The Tenth Circuit Court of Appeals published its opinion in Rosenfield v. HSBC Bank, USA on Monday, June 11, 2012.

The Tenth Circuit affirmed the district court’s decision. Petitioner “appeals from the district court’s order granting a motion to dismiss filed by [Respondent Bank]. [Petitioner] brought claims seeking declaratory and injunctive relief, and damages against [Respondent] for alleged violations of the Truth in Lending Act (“TILA”), averring that her lender failed to make required disclosures in a residential loan refinancing agreement executed by the parties, and that, as a result, she is entitled to a rescission of her loan agreement. [Petitioner] argues that the district court erred in dismissing her claims and holding that she failed to timely exercise her right of rescission within the applicable three-year time bar specified by TILA.

The Court concluded that “the district court properly dismissed [Petitioner]’s complaint on the ground that she failed to exercise her rescission rights within the three-year repose period under § 1635(f) and, therefore, her rescission rights expired. Relatedly, [the Court held] that her rescission argument based upon her defensive actions in Colorado’s Rule 120 proceeding is unavailing, and the district court did not abuse its discretion in declining to allow [Petitioner] to amend her complaint to incorporate facts related to it. In light of these two rulings, which establish that [Petitoiner]’s TILA rescission rights were extinguished, [the Court did not] reach [Petitioner]’s third argument relating to whether the limitations period of § 1640 barred her TILA claims.

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