Court Opinion

ID: 9472798
Source: CourtListenerOpinion
Date Created: 2023-08-05 04:11:18.81314+00
Date Added: 2024-06-11T17:43:09.446150
License: Public Domain

MERRITT, Circuit Judge,
concurring.
I concur in the result reached in the opinion circulated by Judge Weick but not in its reasoning.
In this Truth-In-Lending Act case, the plaintiff borrower alleges that the defendant lender failed to disclose as required by the Truth-In-Lending Act the fact that the lender was imposing a variable rate of interest. The initial interest rate was seven percent, and the disclosure papers indicated an interest rate of seven percent without disclosing that the promissory note provided for a variable rate of interest to be *1045determined by the lender. Some nine years after the initial loan in 1971, the lender gave notice of an increase in the interest rate to eight percent. Within one year following this notice of increase, the borrower sued the lender claiming a Truth-In-Lending Act violation. The District Court dismissed the case on grounds that the one year statute of limitations contained in the Truth-In-Lending Act runs from the date of the initial contract on the loan, although the borrower claims that he did not have notice of the violation until after the lender went up on the interest rate. The District Court held that' the statute of limitations began to run on the date of the initial loan and that the plaintiffs claim is therefore barred. The District Court purported to follow our decision in Wachtel v. West, 476 F.2d 1062 (6th Cir.), cert. denied, 414 U.S. 874, 94 S.Ct. 161, 38 L.Ed.2d 114 (1973).
I favor reversal on grounds that the statute of limitations should begin to run at the time the lender gave notice that it was increasing the interest rate. I would not rely on doctrines of equitable tolling or fraudulent concealment. The lender concedes the Truth-In-Lending Act violation, and concedes that the borrower may not have had any knowledge that the interest rate would be a variable rate rather than the seven percent, rate contained in the disclosure documents. The statute should begin to run on the date the last act in the sequence of acts in violation of the Truth-In-Lending law occurred — namely, when the lender went up on the interest rate some nine years after the initial extension of credit based on an undisclosed variable interest rate. Under the circumstances of this case, no compensable wrong occurred until the interest rate was raised. Judge Lively’s opinion in the Wachtel case does not require that the statute run from the date of the extension of credit because the opinion says that the statute would begin to run “at the latest” from the date of performance of the terms of the agreement. Under this construction, performance of the variable interest rate provision did not occur until the lender went up on the interest rate. Before that time the lender had not gone up on the interest rate and the borrower had no knowledge that he had a problem to complain about. He would have had no damages and nothing of substance to sue for until the lender exercised the variable interest rate provision and went up from seven to eight percent.