afternoon your honors i thank you for this opportunity to return to the very where i spent many personal and professional years as the court knows the united states supreme court said that it would not consider the standing issues were presented and it decided that the case on page fifteen of its opinion when it said that the right of rescission was no longer available because the property had been sold and three years had expired and as we know now the united states supreme court has decided that you do not have to file a lawsuit or be in a lawsuit within three years and the mortgage for or still has a right  tell us what in your view if you're successful on your rescission claim what is the remedy look like now that the houses has already been sold and it goes back to the just record there are several other issues for example the standing issue and on the second so my question is totally different assume that you prevail back in the district court and the court says yes you're entitled to rescission under sixteen thirty five what is the remedy look in for your client now that the house has been sold just described to me what belief the court is then going to award you and the court would then have to decide whether my client that's why i'm asking what so just describe for me in the ideal world you go back on in this report you prevail in court says yes you're entitled to rescission what you get on the record here things have changed because my client seller with buyer but that's not it that's not in the record but forgetting for the moment that happened the procedure would be and there would have to be a this that evidentiary decision of whether in fact my client did not get to notice is the right to cancel whether there were other violations and let me just give up ok now assume you went on all that i'm saying that you have prevailed the court says yes there was a violation you are entitled to rescission but the house has already been sold so i'm just asking describe what remedy you get then you get the truth in lending rescission formula which is a statutory formula so you take the original balance you subtract from the original balance all monies that have been paid in principal and interest including the interest that was charged at the closing you also subtract from that all of the closing cost except for all the credit closing costs except for hazare insurance and real property taxes which the bar has to pay anyway and also the b title to a credit for his reasonable tourney's fees so have to deduct all that you get a reduced statutory principal balance then the or or then has to pay that balance in order to get the recession remedy and usually the courts will give you probably not usually thirty days usually sixty days sometimes ninety days to pay it off and then the bar or as an opportunity as we do in these kind of cases to refinance or to negotiate with his creditor because if you refinance you've got to pay additional fees so many times we're able to refinance with the existing creditor ok we're going for a loan modification so what i hear you saying though is that the remedy you're you would be entitled to in no way affects title to the property that's off the table now it's just a matter of settling up with the lender in terms of money money exchanging hands well normally it does affect title because the borrower is refinancing but the remedy itself does not affect title because thing in the context where the sale has already occurred right i mean i'm wondering if the bank is going to argue somehow that once the sale occurs there can't be any meaningful rescission but what i hear you saying is that sure there can be it's not going to affect title but it will affect how much money exchanges and it could affect title but in this case there's been a settlement so for how how does it affect title if if the sale had already occurred because it may not be a bona fide purchaser there's an argument that if somebody bought it and had knowledge and knowledge of in this case in this case your honor there was an issue that the buyer was actually somehow related to the creditor right but in the ordinary case let's just say it's a complete gotten a court to adjudicate that you are entitled to rescission all you've done to something notice to the lender saying hey i intend to seek rescission that's all that's happened the sale occurs and a complete stranger third party buys the property what effect could could it had to be on title i argue that before the why supreme court just three weeks ago another case there's an issue as to an issue as to whether the buyer was a bona fide purchase intermediate court of appeals but i would say i would say to you generally yes it and you would not affect trial certainly nothing and in teela would affect title you're saying that maybe some provision of state law would would come into play is one of the worst examples of legislation we've ever had and i used to say i think other side of agrees with that i used to say it was the worst but we've had some recent and the courts have not especially helped either the united states pre born the in the beach case created a lot of confusion which led to this split the reason we're here today and the new decision has led to a lot of confusion and a lot of wires and commentators are saying that the borrower gets off with a free house and this is supreme court did not carefully draw the distinction between well the property was sold after and this case after the write the truth in lending rescission right was exercised that's true and mayor to premier and were mayor the case we're talking about the ninth circuit case that would otherwise bind us unless something is superseded that the first part of your opening brief gave us five pages of quotation for a bankruptcy court saying mayor is wrong whether that's true or and the point of mayor is that notice had already been given but that didn't matter once the house was sold that wright evaporated and that this isn't is contrary to the reason this is united states supreme court because it can you point to be the language in the supreme court's decision that you think undermines mayer's such that we should disregard it i don't know i don't have it in front of me but that i'm not the main issue here i know it almost by heart but on the court said look over her the court said that the right of rescission is exercise also file a lawsuit before the three year period elapses and that may be why the court used the language you characterized as unspecific or sloppy because it speaking not about the actual rescission but what you have to do to get within the limitations period but the other part of the regulations says that the right goes away if the property has been sold and i don't see anything in the supreme court's decision that speaks to that part so if there's not something  n just an hour ski that in the terminology of of our miller vs gamey case so undermines our precedent this panel is bound by meyer so you need to show us what it is than in the supreme court's decision that so undermines our court's decision well i'm sure you agree with me the supreme court said that the right to cancel is exercised upon sending the notice and this case is the notice was set now under the under the regulatory regulations at that point it changes the relationship between the creditor  whichever course first exercised it's no longer an issue as to its cancellation and in fact the foreclosing mortgagee that point had obligations under the statu not to conduct a nontraditional foreclosure sale but to except the tender of the principal so we're out of that box we're into another box now i agree with you a of this language one might choose to read it in a variety of ways but as someone who has actually fought twenty years for this for this princip canceled it set in motion under the statute obligations for the bar and obligations for the lender and one of the one of the rights that the lender didn't have was the go ahead and have a nontraditional foreclosure it's not it's not part of the conditional killer  for me i think it's just to look at the way that you've asked me to consider would just be another mistaken analysis of the truth of money remedy  see my time is up your briefs we laid out three possible reasons why this works at a firm this court sees purely on the time our issue the two other issues remain perfectly valid as i believe your honor supported out the meyer decision is still binding precedent well i'm not sure many of my colleagues think that but that's not where i'm at and maybe you could walk through why you think meyers still good in lot of just in ascii you know i believe that just an aussie was narrowly focused on is there a time bar when a bar exercises a right of rescission and then fails to file suit within that three years and it was very narrowly focused on that the opinion was extremely narrowly tailored explicitly just found that a power does not need to file suit within those three years it didn't address the other aspect of the title regulations which state well but let's look at the language of sixteen thirty five i guess and let me do i'll just put it in very blunt terms because maybe you'll talk me out of we're on that but i would say that looking at the language of sixteen thirty five you cannot apply the reasoning of just  three year period but not to the sale of the property period in other words it's just the statute lumps those two things together and so as your opponent has argued once the borrower has exercise the right of rescission by sending the notice which just announced he says is fully sufficient to sort of put aside the three year bar that by definition would also have to be fully sufficient to sort of put aside the bar on the sale of the property so why is that reading of the statute we are i believe it's wrong because it says you know shall expire either three years after the occurrence or they were citizen or transfer of all the property whichever comes first so well that right has been exercised it hasn't been fully  especially in light of beach that this statute really was talking about the expiration of a right that does make it sound like boy if you don't make this thing happen within three years or before the sale of property it is over and that is how our court had interpret it with respect to the three year period he comes in and says no no you guys have gotten it all wrong all that has to happen before the three years is that you just have to send the notice and i guess what i'm saying is that looking at this statute i don't see why that same reasoning would apply just as fully to the you know to the sale of the property bar and here the your opponent would say we did send the notice before the property was sold that's all we had to do under the reason of just asking so i guess i don't see how can we cut off the reason of just the nasty just at the three  bar but not of the sale of the property bar i think from a practical perspective it it's a whole different issue in the three year bar it's the same bar we're still in the property and so it would make sense that if you have that three year period you've exercised it the bank has said no you're still in possession of the property you know that and not to the supreme court didn't get into this is that there has to be some sort of bar it's not an indefinite period but assuming it's you know in california to be a typical three year statute of limitations you would then from the denial have a three year window let's say within the exercise that but when you have a situation where the properties been sold and in this case then sold to a third party it's a completely different situation why because you can there's no longer seal is not being rescinded that's i guess what i and i and that's why i was asking your opponent what is the rescission remedy look like in the post still world and what he described and i think is right is that has nothing to do with the transfer of title the property all that occurs then under subsection b is that you have this calculation that needs to be made it's all just about how much money is going to trade change your hands in your honor i think that that analysis that he used was in line with the dawson analysis which is what the courts in california have in the gist of courts especially have criticized the reasoning there and saying that it really tends to conflate damages cause of action analysis that your opponent described nobody was talking about fiddling around with the title of the house had been sold but there was a calculation made under subsection b as to how much basically how much of a credit the borrower was going to get against the loan proceeds that the lender had realize from the sale it seems to me that's exactly what would happen here and here i think the distinction is that there are two separate teela statutes there is there were citizen cause of action and there was the damages for failure to rescind cause of action and the rescission reading the rest of the statute explicitly talks about a transfer of the security interest to affected feel rescission cause of action the lending institution returns the security interest then upon their return of the security interest the bar returns whatever funds there are less the funds is discussed is the case is that a followed my or have discussed and especially when they distinguish dos and there is no title to return so why not it's not a title i guess to me is confusing because it's not so much the title it's just the security interest that the lender used to have in the property and all i'm saying is that in the post sale world find there is no security interest to nullify because it's already been came after that in the holdings after distinguish that once you have that rescission you can't do that analysis and that the way the statutes are written now they provide two separate avenues it's one or the other and you can't find vault and here they elected soley to proceed under rescission cause of action not the damages cause of action and so because they have not proceeded under that rescission and not proceed under damages there the only thing they were seeking is a rescission and once that sale occurred especially in light of the fact that they then settled with the third party purchaser there is absolutely nothing to rescind and the teal rescission statute provides for that return of title and you can't read the individual sections without the four months before they even sent the rescission notice they got a notice of the foreclosure sale was pending and so i believe they would have an obligation to take some sort of action to stop the foreclosure sale and i believe that whole why state law bears that out as well because they have found in the ames case that you can challenge a foreclosure up until the point that this is typical of title is recorded with the whole why a land court and that wasn't done here pending and especially what knowing that foreclosure had occurred they should have filed some sort of action to seek an injunction to prevent the record nation of the if you don't want to say become some sort of injunction to enjoin bank of america from transferring the title to any third party which would have then allowed for a rescission to take place before that foreclosure became finalized permissible herman miller you know yes i don't know i mean i it's one of those situations as this court has discussed there's the issue of when you see conceal rescission the satchel were caught requires that the security interest be turned over to the borrower and then the borrower is required to return the funds so courts have allowed in those situations for the bank to file an affirmative declaratory relief cause of action which would then require that the district court oversee that transfer and  allows the bank to make sure that its security interest isn't lost by falling out of from a lawsuit now as a practical perspective it financially doesn't work for banks every single time they get a tailor cision notice to file a declaratory relief cause of action because as was shown here the bank responded timely and attached the teal disclosures that had been signed by mr to khushi at the time he got the loan that explicitly stated that he had received two copies and included all of the disclosures that he had signed and so in those situations a for profit perspective the bank's not going to file a lawsuit every single time that that happens teams to me the regime that you're asking us to validate or to construct a post just in ascii would give lenders a strong incentive upon receiving the notice that the borrower sends to foreclose as fast as possible and i think that just strikes me as at odds with the statutory purpose of and that's why i guess i'm really finding myself resistant to your reading of the statute because boy as soon as that pretty soon as you as the bank at that notice you're like oh my god we need to foreclose tomorrow because if we can just for close before they're actually able to file a lawsuit we are in the clear and why would  are two aspects of that i think when asked by it is the reality is actually the reverse as you saw here what tends to happen more often than not is it's the borrower that has the reverse situation they get the i'm behind on my payments all of a sudden they g the foreclosure notice and they say oh well i might as well file this t l rescission lawsuit because it's going to interfere with the bank's ability to foreclose and so we see a lot of these and that's the way it happens and situation here they even filed a lawsuit to all this and he's facing for closure and it's a way to delay the inevitable foreclosure and i think from to answer your question specifically is that there are statutes in place to prevent that they you can't just for are protections in the underlying foreclosure law that prevent the bank from rushing to foreclosure i'm sure there are ways your client can speed the process up if it wants to you're not going to talk you're going to lead me to believe that there are mechanisms to expedite things if there is an incentive for the lender to do that hard time periods in the statute that the lender can change and you know in california you're required to give the notice of default and then there's a period of time before the foreclosure sale that this borrower were going to seek rescission and it seems to me what the statute the regime the statute sets up is one that says as long as the right of rescission has been exercised by virtue of some of the notice if you're in the middle of foreclosure proceedings as the lender you can go forward as long as you have been ordered you know plenary enjoin really enjoyed by a court to to not go forward you can go forward and sell the house at foreclosure but it's going to be subject to the sort of sixteen thirty five b requires if in fact the rescission remedy is upheld and i think you know that would render all foreclosures when there had been a he lost clone unmarketable because it's not something that's recorded forget about whatever hawaii state law does or doesn't provide once a foreclosure sale because to me that's irrelevant in terms of the regime that teela sets up the rescission every remedy has nothing to do with whether good title is passed once a for all that happens is that part of money that you as the lender took in right is sort of held there and then we do this adjustment under sixteen thirty five b and we figure out how much money does the borrower still owe but it is end up just being a a  but because the worst the foreclosure sale has occurred there simply cannot be a rescission because there is nothing that can actually be reset and what's your best case for the proposition you just stated because i haven't found  for the proposition that a borrower is forced into an election of remedies kind of regime because that's what you've just described right and i don't think i haven't seen any cases that say that but if you have one i'd love to look at it it does a good analysis of going through the two and i think it also explicitly deals with dawson which is seems to be someone in line with what your honor is following and i think it it does it good analysis of why that dawson ruling really sort of