Class Action Not Permitted To Assert Rescission Claim Under TILA
Question: May a claim for rescission under the Truth In Lending Act (15 U.S.C. § 1601 et seq.) be asserted as a class action?
Answer: No, according to the Fourth District Court of Appeal, Division 3, in Laliberti v. Pacific Mercantile Bank, 07 C.D.O.S. 979 (Jan. 25, 2001).
In this case, the court noted no California state court had addressed the question of "whether a right to rescind under TILA applies on a class-wide basis, and the issue remains a matter of sharp debate among other courts." Finding no evidence of congressional intent that class treatment is appropriate in an action seeking rescission under TILA, the court sided with those courts holding that rescission under TILA is a personal remedy not suited for class action treatment.
An electronic copy of the opinion is attached.
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