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Rescission is Permissible in Residential Mortgage Transactions

In section II.1.c. of the Motion, the Defendant alleges that the Plaintiff does not have a
claim for rescission. In Nevada, there is a six year statute of limitations for rescinding a
contract. Mackintosh v. California Federal Sav. & Loan Assn, 113 Nev. 393, 404 (Nev.
1997), citing NRS 11.190(1)(b). The Plaintiffs loan is only three years old, so rescission
is available.
Moreover, in Nevada, the right of rescission has been extended to land sale contracts and
their accompanying mortgages if fraud or deceptive practices are involved. See Ford v.
Wertheimer, 79 Nev. 447, 448-49 (Nev. 1963) (The plaintiffs were entitled to rescission
of their mortgage by reason of the fraudulent representations of the defendants).
Moreover, as set forth above, TILAs statutory time limits are tolled when fraud or
deceptive practices may be involved.
Therefore, the Plaintiff has rescission claims.
Nevada also recognizes the unilateral mistake rule found in the Restatement (Second) of
Contracts, which allows for rescission when a mistake at the time of contract was
made as to a basic assumption which has a material effect on the agreed exchange
of performances that is adverse to him [who made the mistake] and (b) the other party
had reason to know of the mistake or his fault caused the mistake. Home Savers, Inc. v.
United Sec. Co, 103 Nev. 357, 358-59 (Nev. 1997), quoting Restatement (Second) of
Contracts, 153 (1981).
By withholding all the proper disclosures from the Plaintiff, the Defendant was
responsible for its misrepresentations of the Transaction, something the Defendant knew
or should have known.
As a result, the Plaintiff may rescind her loan, under TILA, Nevada statutes, and Nevada
law.
Accordingly, the Motion should be denied.
The Nevada Deceptive Trade Practices Act Provides for a Private Cause of Action
In two short paragraphs, the Defendant seeks to dismiss the Plaintiffs Deceptive Trade
Practices Act claim by arguing that the statutory scheme does not provide for a private
right of action. See Motion, p. 8. In these transactions, the Plaintiff was charged at least
$22,729.22 for services related to his loan. Those fees did not culminate in services that
adequately disclosed the loans terms in accordance with TILA and RESPA. As such, the
Plaintiff was deceived, which is actionable under NRS 598.023(3), because NRS Section
41.600.2(e) provides for a private cause of action for a person who is a victim of
consumer fraud.
NRS 41.600.2(e) defines consumer fraud to include a deceptive trade practice as
defined in NRS 598.0915 to 598.0925, inclusive. See In Re Schwalb, 347 B.R. 726, 757

n.43, (Bankr. D.Nev. 2006), quoting NRS 41.600.2(e). Plaintiff has an actionable claim
under NRS 598.023(3) for the violations outlined herein.
Specifically, by not disclosing all of its fees and services properly, the Defendant
misrepresented the quality and character of its services. Misrepresenting the quality and
characteristics of a product or service is actionable under NRS 598.0915(7). By not
providing a good faith estimate, by charging duplicative fees, and by not providing a
timely and proper HUD-1 Settlement Statement to the Plaintiff, the Defendant
misrepresented the benefit of its services. Misrepresenting the benefits of your product or
service is actionable under NRS 598.0915(5). By not providing all the necessary and
proper disclosures at closing, the Defendant misrepresented Plaintiffs rights in the
products (i.e. the loan). Misrepresenting the rights of your product is actionable under
NRS 598.0920(8). As a result, the Plaintiff has claims.
The fees were charged by the Defendant as compensation for the services of providing
the loan and properly disclosing its terms. The Defendant failed to provide these services
in full, which in turn gives rise to claims under Nevada law. Accordingly, the Motion
should be denied.