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Detrimental Reliance Required for Consumers to Recover Actual Damages Under TILA
Description Appeals court held that TILA requires a showing of detrimental reliance by a consumer claiming to have suffered actual financial injury due to a TILA violation in financing disclosure forms. This makes certification of class actions for TILA violations more difficult to obtain.
Topic Consumer Protection
Key Words TILA; Detrimental Reliance; Damages
C A S E   S U M M A R Y
Facts Turner bought a satellite dish system from Star Vision based on a newspaper ad that stated the monthly charge would be $39.95. Financing of the dish was provided by Beneficial and Star Vision. The monthly bill was, in fact, $48.36. Turner claimed that the TILA disclosure statements failed to reveal the true cost of financing the purchase of the dish. Turner did not read the disclosure statements, and so did not rely on them, but claims she is entitled to damages for Beneficial's failure to provide proper disclosure that complied with TILA. Beneficial concedes that the disclosure was improper but contends that since Turner did not read them she did not rely upon them to her detriment, so could not have suffered an injury as a result of the TILA violation. The district court held that detrimental reliance is a necessary element under TILA and denied class certification on the claim. Turner appealed. A panel of the appeals court held that a plaintiff need not show detrimental reliance to claim actual damages. The entire appeals court reheard the appeal.
Decision District court decision affirmed. "We hold that detrimental reliance is an element of a TILA claim for actual damages, that is a plaintiff must present evidence to establish a causal link between the financing institution's noncompliance and his damages." Because of this holding, there may be no certification of a class action against Beneficial on a claim for actual damages.
Citation Turner v. Beneficial Corp., - F.3d - (2001 WL 172432, 11th Cir., 2001)

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