Elaine Huffman v. Credit Union of Texas
2014 U.S. App. LEXIS 13172
| 8th Cir. | 2014Background
- Plaintiffs Huffman and Sandler obtained secured auto loans in Oct 2002 and Jan 2003 that were assigned to Credit Union of Texas (CUT) via Centrix, a portfolio-management agent.
- Plaintiffs allege CUT violated the Missouri UCC by failing to provide required consumer-goods notices before Centrix sold repossessed vehicles and violated the MMPA by failing to disclose that loan costs included default-insurance premiums.
- Both vehicles were repossessed Jan 2005; deficiency notices after sale were mailed March 2005.
- Plaintiffs filed a class action in state court on Nov 24, 2010; CUT removed to federal court and moved for judgment on the pleadings and summary judgment on statute-of-limitations grounds.
- The district court dismissed Mo UCC claims as time-barred under Mo. Rev. Stat. § 516.120(2) (five-year rule) and later granted summary judgment for CUT on MMPA claims as time-barred; plaintiffs appealed.
- The Eighth Circuit affirmed, applying prior circuit precedent that § 516.420’s six-year limitation does not extend to these civil Mo UCC claims and holding the MMPA claims accrued no later than March 2005.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Applicability of six-year § 516.420 to Mo UCC claims | Schwartz precedent: six-year limit applies | Rashaw and circuit precedent: § 516.420 does not apply to civil actions; five-year § 516.120 governs | Court follows Rashaw; Mo UCC claims time-barred (accrued March 2005) |
| Accrual date for MMPA claims under § 516.120(2) (capable-of-ascertainment) | Accrual occurred when counsel later told plaintiffs about undisclosed insurance (2010) | Damage was ascertainable when vehicles repossessed and deficiency notices received (Mar 2005) | Accrued by March 2005; five-year limit expired before 2010 filing; claims time-barred |
| Whether MMPA fraud claims get delayed accrual under § 516.120(5) (discovery rule) | MMPA claim is one "for relief on the ground of fraud" so accrual delayed until discovery (or within 10 years) | MMPA claims allege statutory/regulatory nondisclosure, not common-law fraud; even if § 516.120(5) applied, plaintiffs had inquiry notice by Mar 2005 | Court: MMPA claims are statutory/regulatory (not common-law fraud) and governed by § 516.120(2); alternatively, discovery rule would have been triggered by March 2005, so claims time-barred |
Key Cases Cited
- Rashaw v. United Consumers Credit Union, 685 F.3d 739 (8th Cir. 2012) (held § 516.420’s six-year limitation does not apply to Mo UCC civil actions)
- Washington v. Countrywide Home Loans, Inc., 747 F.3d 955 (8th Cir. 2014) (reaffirmed Rashaw as controlling circuit precedent)
- Powel v. Chaminade Coll. Preparatory, Inc., 197 S.W.3d 576 (Mo. banc 2006) (explains objective capable-of-ascertainment accrual standard)
- Klemme v. Best, 941 S.W.2d 493 (Mo. banc 1997) (damage ascertainability and accrual principles)
- Hess v. Chase Manhattan Bank, USA, N.A., 220 S.W.3d 758 (Mo. banc 2007) (distinguishes MMPA claims from common-law fraud and discusses scope of MMPA relief)
- Creative Mktg. Assoc., Inc. v. AT&T, 476 F.3d 536 (8th Cir. 2007) (explains § 516.120(5) discovery rule for fraud claims)