Truth In Lending Act Case Law
The matter before the Court is the Motion for Partial Summary Judgment filed by the Plaintiff, Chapter 13 Debtor Earle K. Whitley (the "Plaintiff" or the "Debtor"), in his adversary proceeding against Rhodes Financial Services, Inc. (the "Defendant" or "Rhodes"), which adversary proceeding was filed on January 6, 1994. In addition to seeking damages and a determination that he validly rescinded the mortgage held by Rhodes, the Debtor sought a preliminary injunction against Rhodes to restrain it from refusing to honor his valid rescission. After notice and a hearing, this Court entered an order dated January 14, 1994, granting the Debtor's request for a preliminary injunction, ordering Rhodes to deliver a discharge of the mortgage it held on the Debtor's home, and requiring counsel to the Debtor and the Defendant to hold the sum of $ 35,000.00 in a joint escrow account pending a decision on the merits of the adversary complaint.
This action under section 8 of the Real Estate Settlement Practices Act Culpepper v. Inland Mortgage. now on its second visit to our court. The plaintiffs, who have home mortgage loans from Irwin Mortgage Corporation, claim that certain payments, called "yield spread premiums," that Irwin made to the mortgage brokers who handled the plaintiffs' loan applications are illegal kickbacks or referral fees under section 8. The district court initially granted Irwin summary judgment, and on the action's first trip to this court, we reversed. Culpepper v. Inland Mortgage Corp. (Culpepper I), 132 F.3d 692, 694 (11th Cir.1998). 2) (The court then explained in a published order denying rehearing (Culpepper II ) that its opinion-which merely reversed summary judgment-should of course not be read to require summary judgment in the plaintiffs' favor. 3) The panel remanded for further proceedings.
A recent court decision may trigger a new wave of Truth in Lending litigation in Massachusetts. McIntosh v. Irwin Union Bank & Trust Co., 215 F.R.D. 26 (D. Mass. 2003), holds that a suit seeking rescission of a mortgage loan due to Truth in Lending Act (TILA) violations can properly be maintained as a class action. The decision, by Chief Judge Young of the United States District Court for the District of Massachusetts, may well be followed by other judges in that jurisdiction, or even further afield (particularly by other jurisdictions within the First Circuit, such as Rhode Island and Maine).
Noted Case Citations
1. Griggs v. Provident Consumer Discount Co. 680 F.2d 927, certiorari granted, vacated 103 S.Ct. 400, 459 U.S. 56, 74 L.Ed.2d 225, on remand 699 F.2d 642.
2. Griggs v. Provident Consumer Discount Co.. 680 F.2d 927
3. Brophv v. Chase Manhattan Mtg Co, 947 F.Supp. 879.
4. Basile v. H&R Block. Jlt(L. 897 F.Supp. 194.
5. Abele v. Mid-Penn Consumer Discount. 77 B.R. 460, affirmed S45 F.2d 1009.
6. Lifschitz v. American Exp. Co. 560 F.Supp. 458
7. Quino v. A-I CredjtCom. 635 F.Supp. 151
8. Griggs v. Provident Consumer Discount Co.r 503 F.Supp. 246, appeal dismissed 672 F2d 903, appeal after remand 680 F.2d 927, certiorari granted, vacated 103 S.Ct, 400, 459 U.S. 56, 74 L.Ed.2d 225, on remand 699 F,2d 642.
9. O'Neil 484 F.Supp. 18.
10. Geimuso v. Commercial Bank & Trust Co.. 566 F.2d 437.
11. In Re Steinbrecher. 110 B,R. 155, 116 A.L.R. Fed. 881.
12. Griggs v. Provident Consumer Discount Co.. 503 F, Supp 246, appeal dismissed 672 F.2d 903, appeal after remand 680 F.2d 927, certiorari granted, vacated 103 S.Ct, 400, 459 U.S. 56, 74 L.Ed.2d 225, on remand 699 E2d 642.
13. Soils v. Fidelity Consumer Discount Co., 58 B.R. 983,
Menominee River Co. v.
Augustus Spies L & C Co., 147
16. Bader vs. Williams, 61 A 2d 637
17. Barnsdall Refining Corn. v. Birnam Wood Oil Co., 92 F 2d 817.
Farmers and Miners Bank
19. Bowen v. Needles Nat. Bank, 94 F 925, 36 CCA 553, certiorari denied in 20 S.Ct 1024, 176 US 682, 44 LED 637.
Zinc Carbonate Co. v.
First National Bank, 103
Foster Co. v. Citizens Nat’l Bank of
22. Federal Intermediate Credit Bank v. L ‘Herrison, 33 F 2d 841, 842 (1929).
First Nat ‘I Bank of
24. Seligman v. Charlottesville Nat. Bank, 3 Hughes 647, Fed Case No.12, 642, 1039.
Guardian Agency v. Guardian
Mut. Savings Bank, 227
St. Louis Savings Bank vs. Parmalee 95
What is The Right of Rescission?