Facts
- Curry Corporation leased an automobile to Mooro under a written lease agreement and disclosure statement listing monthly payments of $337.
- Mooro submitted an uncontroverted affidavit that he was actually charged $350.48 per month.
- Mooro asserted the lease failed to disclose items required by the Federal Consumer Leasing Act (CLA), including certain fees and taxes, other charges, warranties/guaranties, the vehicle’s initial fair market value, and the aggregate cost at lease end.
- Mooro returned the vehicle and terminated the lease.
- Curry sued Mooro to enforce remaining obligations under the lease; Mooro answered and counterclaimed for CLA violations.
- The trial court granted Mooro summary judgment on Curry’s enforcement claim, denied Curry’s summary-judgment motion, and ruled Mooro’s CLA counterclaim time-barred (no cross-appeal).
Issues
- Whether Curry’s CLA disclosure violations and the payment discrepancy rendered the lease unenforceable, supporting summary judgment for Mooro on Curry’s contract-enforcement claim.
- Whether Curry produced evidence creating a genuine issue of material fact that any CLA violations were unintentional and resulted from a bona fide error under 15 U.S.C. § 1640(c).
Decision
- The Court of Appeals of Georgia affirmed summary judgment for Mooro on Curry’s lease-enforcement claim.
- The court held the record showed CLA disclosure noncompliance and an undisputed discrepancy between the stated and charged monthly payment.
- The court concluded Curry failed to present evidence sufficient to raise a fact issue on the statutory bona fide error defense, for which Curry bore the burden.
- The court allowed the CLA violations to be used defensively to defeat Curry’s claim even though Mooro’s affirmative CLA counterclaim was time-barred.
- The court limited its holding, noting it was not authorizing a lessee to keep the vehicle and avoid obligations based on disclosure defects; Mooro had returned the car.
Legal Principles
- Summary judgment is proper when there is no genuine issue of material fact and the movant is entitled to judgment as a matter of law. O.C.G.A. § 9-11-56(c).
- The Consumer Leasing Act requires specified disclosures in consumer leases, including certain fees/taxes, other charges, warranties/guaranties, initial fair market value, and aggregate end-of-lease cost. 15 U.S.C. § 1667 et seq.
- Under 15 U.S.C. § 1640(c), the creditor/lessor bears the burden to prove by a preponderance of evidence that a violation was unintentional and resulted from a bona fide error.
- In Georgia, when a consumer-protection disclosure statute is violated in connection with a consumer lease, the lessor may be precluded from enforcing the lease against the consumer based on those violations, at least where the consumer has returned the leased property.
Conclusion
The appellate court affirmed judgment for the lessee because the lessor’s undisputed Consumer Leasing Act disclosure violations and billing discrepancy rendered the lease unenforceable in the lessor’s enforcement action, and the lessor failed to produce evidence supporting the statutory bona fide error defense.