TOYE v. NEWREZ LLC (2021)

United States Court of Appeals, Ninth Circuit.2021-09-22No. No. 20-55935

Summary · law.co

Holding. The court affirmed the district court's dismissal because the Toyes failed to bring their TILA rescission action within the applicable four-year statute of limitations under California contract law.

Mikel and Louise Toye sued NewRez LLC claiming violations of the Truth in Lending Act and seeking to rescind a loan. The district court dismissed their case because it was filed too late. On appeal, the Toyes argued the dismissal was improper, but the appellate court found no error in the lower court's decision.

Under TILA, there is no specific deadline for filing rescission claims, so courts apply the state contract law statute of limitations instead. California law provides a four-year window to sue on a contract, with the clock starting when a plaintiff discovers—or reasonably should discover—the injury and its wrongful cause. The Toyes did not file their action within that four-year period, making their claim time-barred.

Summary generated by law.co from the public-domain opinion. The opinion text itself is public domain.

Key issues

Statute of limitations for TILA rescission claims
Application of state contract law deadlines to federal lending violations
When a cause of action accrues under the delayed discovery rule

Procedural posture

Mikel and Louise Toye appealed the district court's dismissal of their TILA rescission action on statute of limitations grounds.

Authorities cited

No cited authorities resolved to law.co cases yet.

Opinion · public domain

MEMORANDUM **

Mikel A. Toye and Louise Toye appeal from the district courts judgment dismissing their action alleging violations of the Truth in Lending Act (“TILA”). We have jurisdiction under 28 U.S.C. § 1291. We review de novo a dismissal based on the statute of limitations. Hoang v. Bank of Am., N.A., 910 F.3d 1096, 1100 (9th Cir. 2018). We affirm.

The district court properly dismissed plaintiffs’ action as time-barred because plaintiffs failed to bring their action to enforce their recission rights within the applicable statute of limitations. See id. at 1100-02 (explaining that because TILA does not provide a statute of limitations for rescission enforcement claims, the state contract law statute of limitations applies); see also Cal. Civ. Code § 337(a) (actions upon a contract are subject to a four-year statute of limitations); Fox v. Ethicon Endo-Surgery, Inc., 35 Cal.4th 797, 27 Cal.Rptr.3d 661, 110 P.3d 914, 917 (2005) (under the delayed discovery rule, cause of action accrues and statute of limitations begins to run “when the plaintiff has reason to suspect an injury and some wrongful cause, unless the plaintiff pleads and proves that a reasonable investigation at that time would not have revealed a factual basis for [the] cause of action”).

We do not consider matters not specifically and distinctly raised and argued in the opening brief. See Padgett v. Wright, 587 F.3d 983, 985 n.2 (9th Cir. 2009).

AFFIRMED.