465 F.3d 24 (1st Cir. 2006), 06-1246, Palmer v. Champion Mortg.

Docket Nº:06-1246.
Citation:465 F.3d 24
Party Name:Amy PALMER, Plaintiff, Appellant, v. CHAMPION MORTGAGE, Defendant, Appellee.
Case Date:September 29, 2006
Court:United States Courts of Appeals, Court of Appeals for the First Circuit

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465 F.3d 24 (1st Cir. 2006)

Amy PALMER, Plaintiff, Appellant,


CHAMPION MORTGAGE, Defendant, Appellee.

No. 06-1246.

United States Court of Appeals, First Circuit.

September 29, 2006

Heard Sept. 12, 2006.


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Christopher M. Lefebvre, with whom Family and Consumer Law Center was on brief, for appellant.

W. Scott O'Connell, with whom Paul M. Lanagan and Nixon Peabody LLP were on brief, for appellee.

Before Selya, Circuit Judge, Siler, [*] Senior Circuit Judge, and Howard, Circuit Judge.

SELYA, Circuit Judge.

This case requires us to determine whether a consumer's professed lack of comprehension of a notice of right to rescind alone suffices to pave the way for belated rescission under the Truth in Lending Act (TILA), 15 U.S.C. §§ 1601-1667. The district court concluded that a bald assertion of subjective confusion did not trump the plain language of the disputed notice and dismissed the plaintiff's amended complaint. The court then rebuffed the plaintiff's two-pronged endeavor either to obtain reconsideration or to restate her claim. This appeal followed. After careful consideration, we affirm.


Because this appeal follows the granting of a motion to dismiss under Fed.R.Civ.P. 12(b)(6), we rehearse the facts as set forth in the plaintiff's amended complaint. See Chongris v. Board of Appeals, 811 F.2d 36, 37 (1st Cir. 1987). Consistent with the case law, however, we eschew reliance on the pleader's rhetorical flourishes, including unsupported conclusions and assertions. See id.; see also Centro Medico del Turabo, Inc. v. Feliciano de Melecio, 406 F.3d 1, 5-6 (1st Cir. 2005).

In March of 2003, plaintiff-appellant Amy Palmer obtained a debt-consolidation loan, secured by a mortgage on her residence, from defendant-appellee Champion Mortgage. The closing took place on March 28, 2003. The plaintiff executed, then and there, a promissory note, a mortgage, a TILA statement, and a settlement sheet. She left without receiving copies of any of these documents.

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Several days later, the plaintiff received by mail copies of the closing documents. Included among these papers was a notice of right to cancel (the Notice) — a notification required by the TILA. See 15 U.S.C. § 1635(a). In relevant part, the Notice informed the plaintiff that:

You have a legal right under federal law to cancel this transaction, without cost, within three (3) business days from whichever of the following events occurs last:

(1) the date of the transaction, which is March 28, 2003; or (date)

(2) the date you received your Truth-in-Lending disclosures; or

(3) the date you received this notice of your right to cancel.

The Notice further provided: "If you cancel by mail or telegram, you must send the notice no later than midnight of APRIL 01, 2003 (or midnight of the third business day following the latest of the three (3) events listed above)."

Although the plaintiff cannot remember the specific date on which she received the documents, she alleges — and for present purposes we accept — that they arrived in early April of 2003, but after April 1. At any rate, nothing happened for well over a year. Then, on or about August 6, 2004, the plaintiff notified Champion of her intent to rescind the transaction.

When Champion failed to respond to the plaintiff's importunings, she sued in federal district court. Her complaint alleged that the inclusion of the April 1 deadline was confusing and that, therefore, she retained the right to rescind the transaction under 15 U.S.C. § 1635, which provides for an extended three-year rescission period when a creditor fails to make one or more material disclosures required under the TILA.

After some procedural skirmishing, not relevant here, the plaintiff served an amended complaint. In tandem with the section 1635 claim, the amended complaint asserted that a right to rescind the transaction also existed under the TILA's state-law counterpart, Mass. Gen. Laws ch. 140D, § 32. Champion moved to dismiss on the ground that the amended complaint failed to state a cognizable claim. See Fed.R.Civ.P. 12 (b)(6). The lower court allowed this motion, concluding that "[t]he Notice the plaintiff received clearly and conspicuously advised her of her right to cancel the transaction within three business days from the last to occur of three events, one of which was the date she received the notice of right to cancel." Thus, the court reasoned, the plaintiff had received the full complement of disclosures stipulated by the TILA and her belated attempt to rescind the transaction was time-barred.2

Undaunted, the plaintiff moved for reconsideration, see fed. R. Civ. P. 59(e), or in the alternative, for leave to file a second amended complaint, see Fed.R.Civ.P. 15(a). The district court denied both entreaties. In refusing leave to amend, the court emphasized that the complaint had already been amended once and that the motion to dismiss had been pending for several months before the court disposed of it. This timely appeal followed.


On appeal, the plaintiff contests the district court's allowance of Champion's motion to dismiss, as well as the denial of her requests for reconsideration and for leave

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to file a second amended complaint.3 We discuss these claims of error sequentially.

A. The Motion to Dismiss.

We review dismissals for failure to state a claim de novo, accepting all well-pleaded facts as true and giving the party who has pleaded the contested claim the benefit of all reasonable inferences. See Rogan v. Menino, 175 F.3d 75, 77 (1st Cir. 1999). Thus, our primary task here is to determine whether, viewing the facts in the light most flattering to the...

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