HIDING IN PLAIN SIGHT: JESINOSKI AND THE CONSUMER’S RIGHT OF RESCISSION
MILAN PRODANOVIC

INTRODUCTION

The crux of litigation involving rescission under TILA centers on
what steps a borrower must take in order to properly rescind a loan. 
Section 1635 requires that consumers notify the creditor of rescission
in accordance with regulations promulgated by the agency responsible
for implementing TILA.7 Regulation Z, which implements TILA,
allows for rescission through written notice.8 Yet, the majority of courts
have found that an additional step is required—the consumer must also
file suit.

This Commentary explores the reasoning behind those decisions in
addition to the arguments put forth by the Petitioners-borrowers (Jesinoskis)
and Respondents (Lenders) in Jesinoski v. Countrywide Home Loans, Inc.
Part II describes the factual background of the case. Part III explains the
legislative origins of TILA and subsequent amendments that affected
rescission. Part III also covers the circuit split that existed before the Supreme
Court’s decision and discusses the limitations on the right of rescission, its
scope, when and how it can be exercised, and the effect of exercising the right.
Part IV describes the Eighth Circuit’s holding in Jesinoski and Part V
summarizes the arguments put forth by the parties. Part VI outlines why the
Supreme Court, in the shortest opinion of the term so far, correctly
read § 1635 to mean what is says: rescission is exercised through
written notice, not by filing suit.

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Hiding in Plain Sight: Jesinoski and the Consumer’s Right of Rescission
Author: Milan Prodanovic
Publication: Duke Journal of Constitutional Law & Public Policy Sidebar

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Date: 04/2015