Edna Jackson v. Syd Grant, Belle G. Grant

890 F.2d 118 Edna JACKSON, Plaintiff-Appellant, v. Syd GRANT, Belle G. Grant, Defendants-Appellees. No. 87-2801. United States Court of Appeals, Ninth Circuit. Argued and Submitted Sept. 15, 1988. Decided May 31, 1989. As Amended Nov. 22, 1989. Robert A. Goldstein, Oakland, Cal., for plaintiff-appellant. Dave M. McGraw, Walnut Creek, Cal., for defendants-appellees. Appeal from the United States District Court for the Northern District of California. Before CHOY, CANBY, and TROTT, Circuit Judges. CANBY, Circuit Judge: 1 Edna Jackson appeals the district court's judgment denying her rescission under the Federal Truth in Lending Act, ("TILA"), 15 U.S.C. Sec. 1601 et seq. Jackson seeks to rescind a loan transaction entered into with Union Home Loans ("Union"), a real estate loan broker. She contends that notice of her right to cancel the loan was not properly given and that other payment terms were insufficiently disclosed on the TILA Disclosure Statement. Reviewing the denial of rescission de novo, Semar v. Platte Valley Fed. Sav. & Loan Ass'n, 791 F.2d 699 , 703 (9th Cir.1986), we reverse the judgment of the district court. BACKGROUND 2 In June of 1982, Union instituted…

Edna Jackson appeals the district court’s judgment denying her rescission under the Federal Truth in Lending Act, (“TILA”), 15 U.S.C. § 1601 et seq. Jackson seeks to rescind a loan transaction entered into with *119 Union Home Loans (“Union”), a real estate loan broker. She contends that notice of her right to cancel the loan was not properly given and that other payment terms were insufficiently disclosed on the TILA Disclosure Statement. Reviewing the denial of rescission de novo, Semar v. Platte Valley Fed. Sav. & Loan Ass’n, 791 F.2d 699, 703 (9th Cir.1986), we reverse the judgment of the district court.

BACKGROUND

In June of 1982, Union instituted foreclosure proceedings on a $26,000 loan made to Jackson in 1981. The loan was secured by a deed of trust recorded against Jackson’s residence in Richmond, California. A trustee’s sale was scheduled for February 9, 1983. In January of 1983, Jackson and Union discussed takeout financing to avoid the pending foreclosure. Union loan officer, Dennis Moore, ordered an appraisal of Jackson’s property and foreclosure was postponed.

On February 18, 1983, Jackson received, read and executed the following documents:

The TILA Disclosure…

dissenting:

I respectfully dissent. I agree with Judge Conti and Judge Schnacke that consummation of Edna Jackson’s loan occurred on February 18, 1983. As I see it, Union Home Loans and Jackson were parties to a binding contract as of that date, and the source of the funds was irrelevant. Union was obligated to come up with the money, and it did. Accordingly, the right to rescind extended only until March 1, 1983.

Under the circumstances her attempt to cancel the transaction almost three years later on February 7, 1986 was almost three years too late.

Today, the Grants learn a painful lesson. They learn that a law designed by Congress to shield the unwary consumer can also be a sword with which a wily borrower can sever financial responsibilities, leaving a trusting lender holding an empty bag. If the majority is correct that Jackson’s arguments have technical merit — and I agree that the majority has made a strong case for its analysis — this result lends new meaning to the phrase “biting the hand that feeds you.” I do share one sentiment with the majority: their lack of enthusiasm for this result.

What fails to come through in the majority’s opinion is that Jackson was…