Summary
The Alabama Supreme Court affirmed summary judgment for Blazer Financial Services in a Truth-in-Lending Act dispute involving a check-in-the-mail loan program. The court held that the delayed disclosure of the loan commencement date and payment timing complied with TILA and Regulation Z, and that Blazer was not required to provide a duplicate copy of the signed promissory note. The court also affirmed decertification of the approximately 11,000-member class action.
Topics
Practice areas
Questions Presented
- Whether Blazer's check-in-the-mail loan program violated the Truth in Lending Act by failing to disclose the exact loan date and payment due dates at the time of the initial solicitation.
- Whether the Truth in Lending Act required Blazer to provide Parrish with a duplicate copy of the signed promissory note.
- Whether the trial court abused its discretion by decertifying the Rule 23(b)(3) class.
Holdings
- Blazer's disclosures complied with the Truth in Lending Act and Regulation Z. In a mail-solicitation transaction where the date of disbursement is controlled by the consumer and is unknown when the disclosures are made, the creditor may use delayed disclosure or disclose the payment timing by reference to the occurrence of a specified event.
- The cited TILA provisions required Blazer to provide a copy of the terms of the legal obligation, but did not require it to provide a duplicate copy of the note bearing Parrish's signature.
- Summary judgment for Blazer was proper because Parrish failed to present substantial evidence of a TILA violation and no genuine issue of material fact existed.
- The trial court did not exceed its discretion in decertifying the Rule 23(b)(3) class, including because class treatment was not superior to individual litigation after summary judgment was properly entered against the named plaintiff.
Key quotations
“Even under a liberal construction of the provisions of the TILA we cannot hold that the disclosures included in Blazer's CIM program were insufficient under the TILA.” (413)
“Based on the above, we hold that Parrish has not presented substantial evidence tending to show that Blazer violated the TILA.” (414)
“We hold that, because the summary judgment was appropriate, class treatment was not superior to individual litigation by the class members; therefore the trial court did not exceed its discretion in decertifying the class.” (416)
Factual background
Blazer mailed customers loan solicitations containing detachable checks and a loan agreement with federal disclosures. Parrish cashed the check, became obligated on the loan, and later defaulted. The loan documents stated that the loan date and accrual of finance charges began when Blazer's bank paid the check, and that the first payment was due one month after the loan date; Blazer also provided follow-up disclosures and a payment book.
Procedural history
Parrish filed the action in 1992 after obtaining a loan through Blazer's check-in-the-mail program. The trial court certified a class of approximately 11,000 borrowers, but later granted Blazer summary judgment on Parrish's claims and decertified the class. Parrish appealed both rulings to the Supreme Court of Alabama, which affirmed.