Standing in the Shoes of the Seller

[David A. Szwak]

Standing in the Shoes of the Seller

The FTC Guidelines for the Holder Rule state that the required notice under the rule "protect[s] the consumer's right to assert against the creditor any legally sufficient claim or defense against the seller. The creditor and assignees stand in the shoes of the seller." Claims and Defenses, 41 Fed.Reg. 20,022, 20,023 [May 14, 1976] [emphasis added]; Houser v. Diamond Corp., 125 Wash.App. 1009, 2005 WestLaw 94452 [Wash. App. Div. 1 2005]; Lozada v. Dale Baker Oldsmobile, Inc., 91 F.Supp.2d 1087 [U.S.D.C. W.D. Mich. 2000]; Alduridi v. Community Trust Bank, N.A., 1999 WestLaw 969644 [Tenn. Ct. App.1999]; Maberry v. Said, 911 F.Supp. 1393 [U.S.D.C. Kan.1995]; Beemus v. Interstate Nat. Dealer Services, Inc., 823 A.2d 979 [Pa. Super. 2003]. These Guidelines make it clear that affirmative action for recovery, other than complete recission, is contemplated in appropriate cases. Jaramillo v. Gonzales, 132 N.M. 459, 50 P.3d 554 [N.M. App. 2002]. Using rather stern language, some courts have stated that: “The FTC Holder Rule is designed to require the assignee of a consumer contract to step into the shoes of the seller with respect to the claims and defenses of the consumer. If the seller's shoes are too tight a fit, then the assignee need not purchase the consumer contract.â€