Case Title: Jackson v. South Holland Dodge, Inc.

Citation: 

Docket Number: 89371

State: illinois

Court: Illinois Supreme Court

Date: 2001-07-26T00:00:00Z

Document:
Docket No. 89371-Agenda 18-January 2001.
VANESSA JACKSON, Appellant, v. SOUTH HOLLAND 
DODGE, INC., et al. (Chrysler Financial Corporation, Appellee).
Opinion filed July 26, 2001.
	JUSTICE THOMAS delivered the opinion of the court:
	The plaintiff, Vanessa Jackson, brought this class action
lawsuit against South Holland Dodge, Inc. (hereinafter, South
Holland Dodge or dealership), and Chrysler Financial Corporation
(Chrysler), alleging violations of the Consumer Fraud and
Deceptive Business Practices Act (Consumer Fraud Act) (815
ILCS 505/1 et seq. (West 1994)), and the Sales Finance Agency
Act (205 ILCS 660/1 et seq. (West 1994)), stemming from the
listing on the parties' financing statement of a charge for the
purchase of an extended service warranty. Chrysler filed a motion
to dismiss, contending that its conduct complied with the
requirements of the federal Truth in Lending Act (TILA) (15
U.S.C. §1601 et seq. (1994)) and, therefore, under Lanier v.
Associates Finance, Inc., 114 Ill. 2d 1 (1986), it could not be held
liable for the state-law claims. The circuit court of Cook County
dismissed the claims against Chrysler and made its order final and
appealable pursuant to Supreme Court Rule 304(a) (155 Ill. 2d R.
304(a)). The appellate court affirmed the dismissal of the claims
against Chrysler. 312 Ill. App. 3d 158. We allowed the plaintiff's
petition for leave to appeal (177 Ill. 2d R. 315), and, for the
reasons that follow, we affirm the appellate court's decision.

BACKGROUND
	The plaintiff's amended complaint and the exhibits attached
thereto establish that on May 17, 1995, the plaintiff purchased a
1995 Dodge Stratus from South Holland Dodge. As part of the
transaction, the plaintiff purchased an extended service warranty
contract for the sum of $1,099. She also entered into a motor
vehicle retail installment contract with the dealership. The retail
installment contract completed by the dealership states that $1,099
was paid to Chrysler for the extended service contract. However,
South Holland Dodge did not actually pay all of the sum listed in
the financing statement to Chrysler. Rather, South Holland Dodge
paid only a small portion of the $1,099 to Chrysler and retained
the balance of the charge. The plaintiff alleged in her amended
complaint that the manner in which the price for the extended
warranty is disclosed is deceptive and misleading because (1) the
dealership represents that the entire amount is being disbursed to
the company named, and (2) the charge is listed in the same
section of the form as nonnegotiable items such as licensing and
filing fees, leading the consumer to erroneously conclude that the
cost of the extended warranty is a nonnegotiable fee.
	South Holland Dodge subsequently assigned the retail
installment contract to Chrysler. The plaintiff alleged that Chrysler
is liable in the present case because the retail installment contract
contains the following provision, which the Federal Trade
Commission (FTC) has required sellers to include in consumer
credit contracts since 1975:
			"Any holder of this consumer credit contract is subject
to all claims and defenses which the debtor could assert
against the seller of goods or services obtained pursuant
hereto or with the proceeds hereof. Recovery hereunder
by the debtor shall not exceed amounts paid by the debtor
hereunder." (Hereinafter, FTC Holder Notice.) 16 C.F.R.
§433.2(a) (1997).
	The plaintiff further alleged that based on Chrysler's
"extensive experience in financing used car transactions," Chrysler
had actual knowledge of the amounts which car dealers disbursed
to the issuers of extended warranties, and knew that the amount
represented on the retail installment contract as having been
disbursed to the issuer of the extended warranty was in fact not
disbursed. The amended complaint cited a 1990 report of the
Attorney General for the State of New York, which concluded that
in 54% of the cases, new car buyers paid in excess of the
manufacturers' suggested retail price for service contracts,
providing the dealerships with an average markup of 76%.
	The amended complaint further alleged that before May 1995,
Chrysler knew that courts had held that allegations that car dealers
misrepresented the entire amount charged for an extended
warranty while retaining a portion of the amount charged stated a
claim under TILA (15 U.S.C. §1601 et seq. (1994)), and
Regulation Z (12 C.F.R. §226 (1995)), a comprehensive set of
rules enacted by the Federal Reserve Board to implement TILA.
Additionally, the plaintiff alleged that Chrysler "acquiesced and
approved of the representations" made by dealerships because it
benefitted from them-the inflated price of the service contract
meant that a greater amount was financed by the borrower. Finally,
the plaintiff alleged that Chrysler facilitated the misrepresentations
of South Holland Dodge and other dealerships by producing and
distributing the retail installment contract forms that dealers
ultimately used to make the misrepresentations.
	Chrysler filed a motion to dismiss pursuant to section 2-615
of the Code of Civil Procedure (735 ILCS 5/2-615 (West 1998)).
Citing Lanier, Chrysler argued that because it complied with its
obligations under TILA as an assignee, it could not be held liable
under Illinois law for the plaintiff's state-law claims. Under TILA,
an assignee can be held liable only if the misrepresentation is
"apparent on the face" of the assigned document. See 15 U.S.C.
§1641(a) (1994); Taylor v. Quality Hyundai, Inc., 150 F.3d 689,
694 (7th Cir. 1998). Because any misrepresentation of the dealer
in this case was not apparent on the face of the document assigned
to Chrysler, it cannot be held liable in this case. Chrysler also
argued that the plaintiff's allegations of "actual knowledge" were
irrelevant to Chrysler's compliance with TILA, and that the
plaintiff's allegations lacked the required specificity to state a
cause of action.
	The trial court granted the motion and dismissed the
plaintiff's complaint against Chrysler with prejudice. On appeal,
the appellate court affirmed, finding that Lanier applied to bar the
plaintiff's state-law claims against Chrysler and that its conclusion
was supported by the " 'overwhelming consensus' " among federal
courts that compliance with TILA was an absolute bar to liability
under the Consumer Fraud Act. 312 Ill. App. 3d at 164, citing
Franks v. Rockenbach Chevrolet Sales, Inc., No. 95-C-6266
(N.D. Ill. December 30, 1999). The appellate court then noted that
a contrary conclusion had recently been reached in Pawlikowski v.
Toyota Motor Credit Corp., 309 Ill. App. 3d 550 (1999), which
held that an assignee's exemption from TILA liability was not a
defense to Consumer Fraud Act liability. The appellate court in the
present case, however, determined that the state and federal cases
relied upon by Pawlikowski did not support that court's decision.
312 Ill. App. 3d at 167.
	The appellate court further concluded that the FTC Holder
Notice could not be used to "trump" the exemption from liability
granted by the operation of TILA. 312 Ill. App. 3d at 169. The
court stated that its decision should not be interpreted as a "blanket
immunization of assignees, no matter their conduct." 312 Ill. App.
3d at 168. Rather, an assignee would still be liable for its
preassignment fraud that was active and direct. 312 Ill. App. 3d at
168. Finally, the court stated that its decision did not conflict with
Pawlikowski in the long run because the court in that case had
found similar conclusory allegations in the plaintiff's complaint to
be insufficient. The appellate court in the present case declined to
remand for more pleadings, however, finding it would not serve
any useful purpose given the barrage of similar lawsuits around the
country which indicated that the plaintiff would not be likely to
form any better factual allegations of fraud. 312 Ill. App. 3d at
169-70.

ANALYSIS
	A motion to dismiss under section 2-615 challenges only the
legal sufficiency of the complaint and all well-pleaded facts in the
complaint are taken as true. Connick v. Suzuki Motor Co., 174 Ill. 2d 482, 490 (1996); Anderson v. Vanden Dorpel, 172 Ill. 2d 399,
407 (1996). The question a reviewing court must determine when
considering the propriety of a section 2-615 motion to dismiss is
whether the allegations of the complaint, when interpreted in the
light most favorable to the plaintiff, are sufficient to establish a
cause of action upon which relief may be granted. Connick, 174 Ill. 2d  at 490.

I. Applicability of Lanier
	The plaintiff argues that the appellate court erred in finding
that Lanier barred the state-law claims in this case. She contends
that Lanier limits exemptions from liability to actions that are
"specifically authorized" by TILA, and that the disclosures in this
case, rather than being authorized by TILA, violate TILA. She
claims that the appellate court incorrectly expanded Lanier when
it found, in essence, that if there is no liability under TILA, then
the conduct is authorized by TILA. The plaintiff relies upon
Pawlikowski, 309 Ill. App. 3d 550, Bernhauser v. Glen Ellyn
Dodge, Inc., 288 Ill. App. 3d 984 (1997), and Grimaldi v. Webb,
282 Ill. App. 3d 174 (1996), to support her position.
	In Lanier, this court considered whether compliance with
TILA is a defense to liability under the Consumer Fraud Act.
There, the plaintiff instituted a class action suit against a financing
company whose loan documents provided that interest would be
computed using the Rule of 78's if the borrower prepaid the
outstanding loan balance. The plaintiff contended that the use of
the Rule of 78's to compute interest in loans made to
unsophisticated borrowers, absent an explanation to the borrower
about the effects of the rule upon early repayment, constituted
common law fraud and violated the Consumer Fraud Act.
	This court in Lanier noted that section 10b(1) of the
Consumer Fraud Act provides that the Consumer Fraud Act does
not apply to " '[a]ctions or transactions specifically authorized by
laws administered by any regulatory body or officer acting under
statutory authority of this State or the United States.' " Lanier, 114 Ill. 2d  at 17, quoting Ill. Rev. Stat. 1981, ch. 121½, par. 270b(1)
(now 815 ILCS 505/10b(1) (West 2000)). Under this provision,
conduct which is authorized by federal statutes and regulations,
such as those administered by the Federal Reserve Board, is
exempt from liability. Lanier, 114 Ill. 2d  at 17.
	This court acknowledged that TILA itself did not specifically
address the type of disclosure required, but that the Federal
Reserve Board rule, Regulation Z, required " 'identification of the
method of computing any unearned portion of the finance charge
in the event of prepayment in full which includes precomputed
interest charges.' " Lanier, 114 Ill. 2d  at 12, quoting 12 C.F.R.
§226.8(b)(7) (1981). The staff of the Federal Reserve Board,
however, stated in an official interpretation that mere reference to
the Rule of 78's by name is sufficient disclosure under Regulation
Z because the Rule of 78's involves complex mathematical
formulations which cannot be accurately condensed into simple
statements. Lanier, 114 Ill. 2d  at 12-13. Noting that the Federal
Reserve Board's formal interpretations are entitled to great
deference, this court held that because the defendant acted in
conformity with the interpretation, the defendant did not violate
Regulation Z by failing to explain the operation of the Rule of
78's. Lanier, 114 Ill. 2d  at 13-16.
	After concluding that the defendant did not violate TILA, this
court then considered whether compliance with TILA precludes
liability under the Illinois statute. Lanier, 114 Ill. 2d  at 16. In
determining that compliance with TILA does preclude liability
under the Illinois statute, the court stated the following:
		"The Consumer Fraud Act, under which plaintiff
complains, does not mandate any particular form or
subject of disclosure, but rather is a general prohibition of
fraud and misrepresentation. Because the Illinois
consumer credit statutes requiring specific disclosures are
met by compliance with the Truth in Lending Act, we
believe that the Consumer Fraud Act's general prohibition
of fraud and misrepresentation in consumer transactions
did not require more extensive disclosure in the plaintiff's
loan agreement than the disclosure required by the
comprehensive provisions of the Truth in Lending Act.
Rather, we perceive in the disclosure provisions of
Illinois' consumer credit statutes a consistent policy
against extending disclosure requirements under Illinois
law beyond those mandated by the Truth in Lending Act,
in situations where both the Act and the Illinois statutes
apply." Lanier, 114 Ill. 2d  at 17.
	We believe that the language quoted in Lanier applies with
equal force in the present case. Chrysler, as assignee, complied
with the disclosure requirements of TILA by not violating its
obligation under the Act. We find no merit to the plaintiff's claim
that this case is fundamentally different from Lanier simply
because here the dealership, as the creditor, violated TILA, while
the creditor in Lanier did not violate TILA. The plaintiff's
argument ignores the reality that Chrysler complied with its
obligations under TILA. In fact, Chrysler's compliance with TILA
is even clearer in this case than was the compliance of the creditor
in Lanier because in Lanier the court had to resort to a staff
interpretation to determine compliance, while compliance in this
case can be determined from the express language of the statute
enacted by Congress.
	The purpose of TILA is "to assure a meaningful disclosure of
credit terms." 15 U.S.C. §1601(a) (1994). However, in enacting its
1980 amendments to section 1641(a) of TILA, Congress expressed
the additional purposes of narrowing "considerably the potential
scope of assignee liability," to " 'mak[e] compliance easier for
creditors,' " and to limit civil liability for statutory penalties for
only significant violations. Ramadan v. Chase Manhattan Corp.,
229 F.3d 194, 200 (3d Cir. 2000), citing S. Rep. No. 96-73
(1979), reprinted in 1980 U.S.C.C.A.N. 280. To achieve these
goals, TILA imposes separate and distinct disclosure obligations
on creditors and assignees. TILA makes creditors, such as the
dealership in this case, primarily responsible for making the
required disclosures and ensuring that they are accurate. Creditors
commit a violation of TILA when they fail, as alleged in this case,
to disclose their retention of a portion of extended warranty
charges reported as "Amounts Paid to Others on Your Behalf."
See Taylor, 150 F.3d  at 691; see also Gibson v. Bob Watson
Chevrolet-Geo, Inc., 112 F.3d 283 (7th Cir. 1997). However,
TILA limits the duty required by assignees under the Act to a
review of the assigned documents themselves to determine if they
contain violations that a reasonable person can spot on the face of
those documents. 15 U.S.C. §1641(a) (1994); Taylor, 150 F.3d  at
694; accord Ramadan, 229 F.3d  at 197; Green v. Levis Motors,
Inc., 179 F.3d 286, 295 (5th Cir. 1999); Ellis v. General Motors
Acceptance Corp., 160 F.3d 703, 709-10 (11th Cir. 1998).
	Section 1641(a) of TILA specifically addresses the liability of
assignees as follows:
			"Except as otherwise specifically provided in this
subchapter, any civil action for a violation of this
subchapter or proceeding *** which may be brought
against a creditor may be maintained against any assignee
of such creditor only if the violation for which such action
or proceeding is brought is apparent on the face of the
disclosure statement ***. A violation apparent on the face
of the disclosure statement includes but is not limited to
(1) a disclosure which can be determined to be incomplete
or inaccurate from the face of the disclosure statement or
other documents assigned, or (2) a disclosure which does
not use the terms required to be used by this subchapter."
(Emphasis added.) 15 U.S.C. §1641(a) (1994).
The plaintiff does not allege in her amended complaint that the
disclosure violation-that the dealer kept a portion of the amount
paid for the extended warranty-appears anywhere on the face of
the documents assigned to Chrysler. In such cases, various circuits
of the federal court of appeals have consistently dismissed TILA
claims brought against assignees because the disclosures were not
apparent on the face of the assigned documents. Ramadan, 229 F.3d  at 203, Green, 179 F.3d  at 296; Ellis, 160 F.3d  at 710;
Taylor, 150 F.3d  at 691.
	Those courts have also rejected allegations similar to the ones
made by the plaintiff in this case of "actual knowledge" based on
an assignee's "experience in the field." Ramadan, 229 F.3d  at 198,
Taylor, 150 F.3d  at 694. For example, in Taylor the court noted:
			"[W]e cannot agree that awareness of the practices of
some creditors can be equated to knowledge that a
particular disclosure on a particular TILA form is
inaccurate or incomplete. These are good cases in point.
Suppose that 75%, or even 90%, of all automobile dealers
in the greater Chicago area engage in the practice about
which the plaintiffs are complaining. That still does not
mean that an employee of a bank or other financial
institution could tell, simply by looking at the face of the
documents assigned, whether a particular TILA statement
before [him or] her was inaccurate or incomplete. One out
of four, or one out of ten, might be perfectly accurate. In
effect, the rule which the plaintiffs are arguing would
impose a duty of inquiry on financial institutions that
serve as assignees. Yet this is the very kind of duty that
the statute precludes, by limiting the required inquiry to
defects that can by ascertained from the face of the
documents themselves." Taylor, 150 F.3d  at 694.
	We agree with the appellate court that there is no reason why
Lanier's reach should not extend to instances where an assignee
is free from liability under federal law because of the TILA
exemption in section 1641(a). As we noted in Lanier, there is a
consistent policy throughout Illinois law against extending
disclosure requirements beyond what is mandated by federal law.
Lanier, 114 Ill. 2d  at 17. If an assignee were liable under the
Consumer Fraud Act, though exempt from liability under TILA,
it would impose disclosure requirements on assignees beyond
those mandated by federal law. This would frustrate the
overarching reasons put forth by Congress in enacting the assignee
exemption, i.e., to narrow assignee liability, to make compliance
easier for creditors, and to eliminate confusion as to the
responsibilities of assignees. See Ramadan, 229 F.3d  at 200. Thus,
we conclude that an assignee is not responsible for the
misrepresentations made by the dealer to the consumer outside of
reviewing the face of the assigned document for apparent defects.
Accordingly, we will follow Lanier and hold that compliance with
the disclosure requirements of TILA is a defense to the Consumer
Fraud Act claim against Chrysler in this case.
	The plaintiff's reliance on Pawlikowski is not persuasive. The
cases relied upon by Pawlikowski do not support its finding that
Lanier should not apply to bar liability where the assignee
complied with TILA under similar facts. For example,
Pawlikowski relied upon Bernhauser v. Glen Ellyn Dodge, Inc.,
288 Ill. App. 3d 984 (1997). However, Bernhauser did not involve
a claim against an assignee. Rather, the plaintiff in that case sued
the dealership and the manufacturer, not the finance company.
Thus, the case did not involve an issue of an assignee's liability
under the Consumer Fraud Act where the assignee had met its
obligations under section 1641(a) of TILA. In sum, we find the
rationale of Pawlikowski to be flawed with respect to the
application of Lanier.
	Additionally, we note that Pawlikowski ultimately concluded
that the allegations in the plaintiff's complaint were insufficient to
state a cause of action under the Consumer Fraud Act or for
common law fraud or civil conspiracy. Pawlikowski, 309 Ill. App.
3d at 563-65. The allegations found insufficient in Pawlikowski
were very similar to those made by the plaintiff in the present case.
Specifically, the plaintiff in Pawlikowski alleged that the assignee
" 'participated in a scheme and therefore conspired with
dealerships to *** exact monies in amounts in excess of' the
actual cost of the warranties," that the assignee "was aware of the
misleading disclosures and that [the assignee] produced and
distributed the retail installment contracts 'that enable [the dealer]
*** to make the misrepresentations' to the plaintiff." Pawlikowski,
309 Ill. App. 3d at 564. Thus, the instant appellate court correctly
noted that Pawlikowski did not conflict with its view that such
allegations are insufficient to state a cause of action.
	We also find the plaintiff's reliance upon Grimaldi v. Webb,
282 Ill. App. 3d 174 (1996), to be unpersuasive. There, the
plaintiff sued the dealership and the assignee of the financing
statement, claiming that the dealer misrepresented the amount of
the extended warranty purchased by the plaintiff. The appellate
court rejected the dealership's claim that its conduct was
authorized by TILA, finding instead that the dealership's conduct
may have actually violated TILA. Grimaldi, 282 Ill. App. 3d at
181. The appellate court then noted that the circuit court never
reached the issue of the assignee's liability for the dealership's
conduct under the Consumer Fraud Act because it found that the
plaintiff failed to state a claim against the dealership. Therefore,
the appellate court continued, the issue of the assignee's liability
was not properly before it on review. Grimaldi, 282 Ill. App. 3d at
183. Given that Grimaldi does not address the liability of
assignees or our holding in Lanier, we fail to see the relevance of
that case to the plaintiff's claim that Lanier should not apply here.
	We also agree with the appellate court that application of
Lanier to this case does not confer a blanket immunization of
assignees from liability under the Consumer Fraud Act. A plaintiff
would be entitled to maintain a cause of action under the
Consumer Fraud Act where the assignee's fraud is active and
direct. Preassignment fraud would be independent of and separate
from the TILA assignee exemption and would thus be actionable
under Illinois law. For example, if a plaintiff could allege specific
facts showing that the assignee met with the car dealer and
concocted a scheme to put false statements on the financing
statement, an assignee would not be exempt from a state fraud
action from a duped buyer.
	In opposing a motion for dismissal under section 2-615 of the
Code of Civil Procedure, a plaintiff cannot rely simply on mere
conclusions of law or fact unsupported by specific factual
allegations. Anderson, 172 Ill. 2d  at 408. Illinois is, moreover, a
fact-pleading jurisdiction, and a plaintiff must allege facts
sufficient to bring his or her claim within the cause of action
asserted. Anderson, 172 Ill. 2d  at 408.
	In the present case, there are no specific factual allegations
that, prior to the assignment of the financing statement, Chrysler
directly participated in a scheme with the dealership to
misrepresent facts to the plaintiff. Instead, the plaintiff's
conclusory allegations of "actual knowledge" are at best nothing
more than a claim that Chrysler knowingly received the benefits
of another's fraud. We have previously held that the Consumer
Fraud Act does not provide a cause of action against those who
knowingly receive the benefits from the person committing a
violation of the Act. Zekman v. Direct American Marketers, Inc.,
182 Ill. 2d 359, 370 (1998).
	Here, the closest the plaintiff came to alleging specific factual
allegations to support its conclusory allegations was its claim that
Chrysler supplies the blank forms that the dealerships later fill out
with a misrepresentation as to the allocation of the extended
warranty charge. However, the blank forms themselves do not
contain a misrepresentation, and there was nothing inherently
deceptive about those forms. As the appellate court correctly
noted, "[t]he forms did not promote the deceptive practice of the
dealers-no more than the Internal Revenue Service could be said
to promote fraud when it supplies blank forms to tax cheaters."
312 Ill. App. 3d at 169.

II. FTC Holder Notice
	The plaintiff argues that Chrysler assumed liability through
the FTC Holder Notice contained in the contract. As previously
noted, the FTC Holder Notice contained in the contract provides
for assignee liability with respect to all claims and defenses which
the debtor could assert against the seller. In view of this provision,
the plaintiff maintains that the installment contract should be
enforced against the assignee as written as a matter of state
contract law.
	We disagree. In the context of federal TILA claims, the
federal courts that have considered the same argument have
unanimously rejected it. This is because (1) the FTC language is
required by FTC regulation and is therefore not the subject of
bargaining between the parties, and (2) its reach has been modified
by subsequent congressional statutory amendment. In that regard,
we note that the FTC Holder Notice language is required to be
placed in all consumer installment contracts by an FTC regulation
adopted in 1975. 16 C.F.R. §433.2(a) (1997); Taylor, 150 F.3d  at
692. The language is a legally required part of every consumer
financing contract right down to the required font size. See 16
C.F.R. §433.2(a) (1997). As the Taylor court observed, "[t]he
Holder Notice, even though contained within the contract, was not
the subject of bargaining between the parties, and indeed could not
have been. It is part of the contract by force of law, and it must be
read in light of other laws that modify its reach." Taylor, 150 F.3d 
at 693. The Taylor court noted that in 1980 Congress specifically
amended section 1641(a) of TILA to limit assignee liability. Thus,
the unmistakable effect of the 1980 amendment is to trump the
FTC's holder notice. Taylor, 150 F.3d  at 692-93.
	Adherence to the principle that the Holder Notice must be
read in light of section 1641(a)'s limitation on assignee liability
does not render the contract language meaningless. Ellis, 160 F.3d 
at 708. The FTC provision requiring the Holder Notice continues
to fill a valuable role by confirming the right of buyers to withhold
payment from sellers or assignees, if it becomes apparent that the
car purchased is a lemon. Ellis, 160 F.3d  at 709.
	The plaintiff cites section 1610(d) of TILA (15 U.S.C.
1610(d) (1994)), which provides that "[e]xcept as specified in
sections 1635, 1640, and 1666e of this title, this subchapter and
the regulations issued thereunder do not affect the validity or
enforceability of any contract or obligation under State or Federal
law." Based on the language of section 1610(d), she argues that
section 1641(a) should not be read to modify the reach of the FTC
Holder Notice in the contract.
	Essentially the same argument was rejected by the Court of
Appeals, Fifth Circuit, in Green v. Levis Motors, Inc., 179 F.3d 286 (5th Cir. 1999). There, the court noted that the FTC's
regulation did not neatly complement the limitation on assignee
liability in section 1641(a). The court concluded, however, that to
read section 1610(d) in the way suggested by the plaintiff would
produce an absurd result: the protections of section 1641(a) would
never have any effect on consumer credit contracts. Green, 179 F.3d  at 296. We find the same rationale to be applicable here.
Accordingly, we reject the plaintiff's contract-based effort to side-step section 1641(a) of TILA.
	The plaintiff's argument relying on the FTC Holder Notice
must be rejected for the additional reason that it conflicts with the
official FTC commentary on the subject. When the FTC adopted
its Holder Notice requirement, it published an official commentary
explaining that the Holder Notice could be used as a shield against
claims by assignees, but that it only permits affirmative actions
against assignees where the seller's breach is so substantial that
rescission is warranted. The official commentary reads as follows:
		"This rule is directed at the preservation of consumer
claims and defenses [which] means that a consumer can
(1) defend a creditor's suit for payment of an obligation
by raising a valid claim against the seller as a setoff, and
(2) maintain an affirmative action against a creditor who
has received payments for a return of monies paid on
account. The latter alternative will only be available
where a seller's breach is so substantial that a court is
persuaded that rescission and restitution are justified. The
most typical example of such a case would involve non-delivery, where delivery was scheduled after the date
payments to a creditor commenced." 40 Fed. Reg. 53,505,
53,524 (1975).
	The plaintiff does not argue that the alleged disclosure
violation in the present case would warrant rescission of the
underlying contract. Instead, she attempts to contradict the official
commentary by relying on an informal FTC staff opinion letter
which asserts that there are no limitations on the assignee's
liability under the required FTC Holder Notice. We note, however,
that this document was not submitted to the circuit court and is not
properly a part of the record on appeal. Thus, it cannot be
considered by this court. Kazubowski v. Kazubowski, 45 Ill. 2d 405, 415 (1970). At any rate, the letter acknowledges that it is an
informal staff opinion letter, not binding on the FTC. We, then, do
not find it persuasive authority to override the official
commentary, indicating that the plaintiff may not use the Holder
Notice as an affirmative weapon against the assignee under the
present circumstances.

III. Sales Finance Agency Act Claim
	The plaintiff next argues that the appellate court erred in
affirming the trial court's dismissal of the plaintiff's Sales Finance
Agency Act claim. She notes that the Sales Finance Agency Act
contains an "actual knowledge" standard of liability. See 205 ILCS
660/8.5 (West 1994). She points out that TILA's disclosure
requirements "do not annul, alter, or affect the laws of any State
relating to the disclosure of information in connection with credit
transactions, except to the extent that those laws are inconsistent
with the provisions of this subchapter and then only to the extent
of the inconsistency." See 15 U.S.C. §1610(a)(1) (1994). She then
asserts that the "apparent on the face standard" of section 1641(a)
of TILA does not preempt the "actual knowledge" standard.
	Initially, we note the plaintiff does not make an argument that
the disclosure requirements of TILA and the standard set forth in
the Sales Finance Agency Act are consistent. Section 1610(a)(1)
provides that the provisions of TILA preempt state law to the
extent that the state law is inconsistent with those provisions. 15
U.S.C. §1610(a)(1) (1994); 12 C.F.R. §226.28(a)(1) (1995). As
previously stated, the language of section 1641(a) of TILA sets
forth a single, clear standard, which provides that in order for an
assignee of a loan to be held liable for a disclosure violation, the
violation must be "apparent on the face" of the disclosure
statement. Thus, a good argument could be made that an "actual
knowledge" standard places an additional burden on assignees in
conflict with TILA, which would therefore preempt the application
of the state law. However, we need not decide this question
because we find that the plaintiff's complaint fails to state a cause
of action under the Sales Finance Agency Act.
	Section 8.5 of the Sales Finance Agency Act provides that a
violation of the Act occurs with the "[p]urchase of any retail
contract *** after actual knowledge that the contract *** violates
this Act *** or the Motor Vehicle Retail Installment Sales Act."
205 ILCS 660/8.5 (West 1994). The plaintiff's amended complaint
alleges that Chrysler's conduct violated the Motor Vehicle Retail
Installment Sales Act (815 ILCS 375/1 et seq. (West 1994)).
Unlike the strict disclosure requirements of TILA, however, the
Motor Vehicle Retail Installment Sales Act requires, in relevant
part, only that the contract disclose "clearly, conspicuously and in
a meaningful sequence" the following items: "[a]ll other charges,
individually itemized, which are included in the amount financed
but which are not a part of the finance charge." 815 ILCS 375/5(4)
(West 1994). Here, the $1,099 charge for the extended warranty
was clearly disclosed in the contract. That the dealer was retaining
a portion of the amount disclosed was not a required disclosure
and nothing in the Motor Vehicle Retail Installment Sales Act
requires any further detail. Accordingly, the plaintiff's allegation
that Chrysler had "actual knowledge," based on its "experience,"
that the full amount of the warranty was not disbursed to the issuer
failed to state a claim upon which relief could be granted under the
Sales Finance Agency Act.
	Lastly, the plaintiff requests in her reply brief that she be
given an opportunity to replead her complaint. However, the
plaintiff failed to suggest in her appeal briefs any factual
allegations or proposed amendments which might cure the defects
in her amended complaint. At oral argument, the plaintiff
suggested that she could allege that Chrysler had a motivation to
sell "other Chrysler products" and that Chrysler conducts a "heavy
review" of the dealership contracts. We do not believe, however,
that such allegations would bring her claim within the scope of the
causes of action being asserted. See Anderson, 172 Ill. 2d  at 408-11.

CONCLUSION
	For the reasons stated, we hold that section 1641(a) precludes
assignee liability under the Consumer Fraud Act in this case. We
further hold that the plaintiff failed to state a cause of action under
either the Sales Finance Agency Act or the Motor Vehicle Retail
Installment Sales Act. Accordingly, we affirm the judgment of the
appellate court.

Affirmed.
	JUSTICE KILBRIDE, specially concurring:
	I agree with the majority's determination that the plaintiff in
this case did not sufficiently plead a cause of action under the
Consumer Fraud and Deceptive Business Practices Act (Consumer
Fraud Act or Act) (815 ILCS 505/1 et seq. (West 1994)) against
the assignee of the contract, Chrysler Financial Corporation
(Chrysler). I therefore concur in the result. I believe, however, that
the majority has unnecessarily relied upon our holding in Lanier
when the resolution of this case is dictated solely by the language
of section 1641 of the Truth in Lending Act (TILA) (15 U.S.C.
§1641 (1994)).
	Unlike the case at hand, Lanier involved a suit against a
creditor directly, as opposed to an assignee, and whether the fact
that the creditor engaged in conduct specifically authorized by
TILA was a defense to liability under the Consumer Fraud Act.
The loan agreement in Lanier referred to "the Rule of 78's" to
explain the method of calculating the creditor's accrued interest if
the borrower prepaid the outstanding balance. The creditor
provided no further explanation of the functioning of the Rule of
78's. After prepaying the loan amount, plaintiff filed suit under the
Consumer Fraud Act, partially alleging that the lender's failure to
explain the mathematical operation of the Rule of 78's constituted
a deceptive business practice under the Consumer Fraud Act. The
lender responded that simple reference to the Rule of 78's method
was a sufficient disclosure under TILA, according to the Federal
Reserve Board, and compliance with TILA should preclude
liability under the Consumer Fraud Act.
	In holding that specific compliance with TILA precluded
liability under the Consumer Fraud Act, this court noted that
section 10b(1) of the Act provides that it does not apply to
" '[a]ctions or transactions specifically authorized by laws
administered by any regulatory body or officer acting under
statutory authority of this State or the United States.' " (Emphasis
added.) Lanier, 114 Ill. 2d  at 17, quoting Ill. Rev. Stat. 1981, ch.
121½, par. 270b(1) (now 815 ILCS 505/10b(1) (West 2000)). The
method of disclosure for the Rule of 78's used by the creditor in
Lanier was specifically authorized by the Federal Reserve Board.
I therefore agree with plaintiff that Lanier plainly limited
exemptions from liability to conduct that is directly required by
TILA as opposed to conduct that does not violate TILA. I also
agree with plaintiff that the appellate court (and now this court)
has vastly extended our holding in Lanier by finding that if there
is no technical violation of TILA, then the conduct is specifically
authorized by TILA. This interpretation dramatically expands the
Lanier holding and leaves ajar a door of escape for creditors who
are being sued directly by borrowers. Simply put, under the
majority's holding in this case, if a creditor is able to show that it
has not engaged in conduct violative of TILA, there may not be a
remedy for a plaintiff for an unfair or deceptive business practice
under the Consumer Fraud Act. Under the Lanier holding, a
creditor had to be affirmatively complying with a mandate of
TILA in order to be so exempted from liability under the Act, and
I believe that is the only viable rule.
	In my view, the Pawlikowski court arrived at the appropriate
conclusion with regard to assignees by, in effect, simply relying on
the plain language of section 1641. Under that section, an action
may be brought against an assignee " 'only if the violation *** is
apparent on the face of the disclosure statement.' " Pawlikowski,
309 Ill. App. 3d at 558, quoting 15 U.S.C. §1641(a) (1994). Thus,
unless there is such a patent violation, or unless the plaintiff can
show active and direct, preassignment fraud on the part of the
assignee, then there is no viable cause of action for the plaintiff
against the assignee. In such cases as in the case at hand, a court
need not move beyond these two specific avenues of inquiry.
	For these reasons, I concur only in the result arrived at by the
majority and I do not endorse the reasoning employed to reach that
result.