Jerry Hoang v. Bank of America, N.A.
910 F.3d 1096
9th Cir.2018Background
- In April 2010 Hoang refinanced his home loan with Bank of America; the Bank failed to provide TILA rescission disclosures.
- Hoang sent a notice of rescission to the Bank on April 15, 2013 (within TILA’s 3‑year rescission window); the Bank did not act.
- In February 2017 the Bank initiated non‑judicial foreclosure; Hoang sued May 9, 2017 seeking to enforce rescission via declaratory and injunctive relief (complaint also requested WCPA damages in the prayer).
- The district court found Hoang had timely rescinded by notice but dismissed the suit as time barred, having borrowed TILA’s one‑year damages limitation (15 U.S.C. § 1640(e)) based on a misreading of the complaint.
- The Ninth Circuit reviewed de novo whether a limitations period applies to suits to enforce rescission after a timely notice and, if so, which limitations period to borrow from Washington law.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether any statute of limitations applies to enforcement suits after a timely TILA rescission notice | No statute of limitations applies post‑Jesinoski; borrower need only notify within 3 years | Some limitations period must apply; district court and Bank favored borrowing a shorter period | A limitations period applies; courts should borrow an analogous state statute rather than assume no limit |
| If a state limitations period is borrowed, which Washington statute is most analogous | Not argued to preferto a particular state statute on appeal | Bank argued for Washington’s 2‑year catchall; district court applied TILA’s 1‑year damages period | Washington’s 6‑year contract statute is the closest analogy and governs enforcement suits |
| Whether TILA’s 1‑year damages limitation (15 U.S.C. § 1640(e)) governs equitable rescission enforcement suits | Hoang did not rely on § 1640(e); rescission enforcement is equitable and distinct | District court applied § 1640(e) (based on misreading complaint) | § 1640(e) is inapplicable; it governs monetary damages only and is not the proper borrowed period |
| Whether denial of leave to amend was proper given the statute of limitations ruling | Leave to amend should be granted; dismissal without leave was erroneous | District court denied leave as futile because it believed claims were time‑barred under § 1640(e) | Denial was improper because under the six‑year contract period amendment may not be futile; case reversed and remanded |
Key Cases Cited
- Jesinoski v. Countrywide Home Loans, 135 S. Ct. 790 (2015) (rescission is effected by borrower’s timely notice; suit within 3 years not required to effect rescission)
- County of Oneida v. Oneida Indian Nation of N.Y. State, 470 U.S. 226 (1985) (federal courts borrow analogous state statutes of limitations when federal statutes are silent)
- DelCostello v. Int’l Bhd. of Teamsters, 462 U.S. 151 (1983) (courts generally assume some limitations period applies and borrow state law)
- Reed v. United Transp. Union, 488 U.S. 319 (1989) (narrow exception when a federal rule provides a closer analogy for borrowing limitations)
- Agency Holding Corp. v. Malley‑Duffy & Assoc., Inc., 483 U.S. 143 (1987) (declining to borrow catchall state statute where not analogous)
- McOmie‑Gray v. Bank of Am. Home Loans, 667 F.3d 1325 (9th Cir. 2012) (pre‑Jesinoski Ninth Circuit precedent requiring suit within 3 years to enforce rescission)
- Miguel v. Country Funding Corp., 309 F.3d 1161 (9th Cir. 2002) (characterizing § 1635(f) as an absolute limitation pre‑Jesinoski)
- Sharkey v. O’Neal, 778 F.3d 767 (9th Cir. 2015) (applying the practice of borrowing state limitations periods for federal claims)