Brief Fact Summary. The Plaintiffs, Jerry and Mary Taylor (Plaintiffs), sued the Defendants, Quality Hyundai, Inc. (Quality) and Bank One (Defendants), for violations of the Truth in Lending Act (TILA).
Synopsis of Rule of Law. Any civil action brought for a violation of the TILA that may be brought against a creditor, may be maintained against any assignee of the creditor, but only if the violation of the TILA is apparent on the face of the disclosure statement.
It is part of the contract by force of law, and it must be read in light of other laws that modify its reach.
View Full Point of LawIssue. Are these actions maintainable against the assignees of the creditors?
Held. No. Any civil action brought for a violation of the TILA that may be brought against a creditor may be maintained against any assignee of the creditor, but only if the violation of the TILA is apparent on the face of the disclosure statement. An apparent violation includes, but is not limited to, a disclosure that can be determined to be incomplete or inaccurate from the face of the disclosure statement or other documents assigned or a disclosure that does not use the terms required to be used by the TILA. In the present cases, the Plaintiffs argued that the assignees, as active participants in the lending market, knew of lending practices in the industry. The court rejected this by stating that the awareness of the practices of some creditors is not the same as knowledge of an inaccurate or incomplete disclosure. Since no violation of the TILA was apparent on the face of the disclosure, the actions cannot be maintained against the assignees.
Discussion. Any civil action brought for a violation of the TILA that may be brought against a creditor, may be maintained against any assignee of the creditor, but only if the violation of the TILA is apparent on the face of the disclosure statement.