## Facts

- Frances Hamilton and Barbara and George Seidel obtained long-term residential mortgage loans from Ohio Savings Bank in the 1970s with stated fixed interest rates and monthly payments over approximately 29 years.
- The notes stated that interest would be computed monthly by deriving a daily interest factor based on a 360-day year and multiplying it by the actual number of days in each calendar month (a 365/360 method).
- Ohio Savings provided federal Truth in Lending Act (TILA) / Regulation Z disclosure forms; the record contained inconsistent or missing references to the 365/360 calculation method.
- A later analysis by another mortgagor asserted that the 365/360 method causes the effective rate paid to exceed the stated rate.
- Plaintiffs alleged the disclosures were materially inaccurate, that the 365/360 method caused incomplete amortization within the stated term, and that the bank’s conduct supported TILA/Regulation Z claims and Ohio common-law claims (including fraud).

## Issues

1. Whether TILA’s one-year limitations period in 15 U.S.C. § 1640(e) may be equitably tolled when alleged fraud or nondisclosure prevents a borrower from discovering the violation.
2. Whether summary judgment was proper on plaintiffs’ TILA and Ohio common-law claims where evidence suggested technical, non-obvious inaccuracies in interest-rate disclosures and loan amortization effects.

## Decision

- The Ohio Supreme Court reversed the court of appeals and remanded.
- The court held that the one-year limitations period in 15 U.S.C. § 1640(e) is subject to equitable tolling when alleged fraud or nondisclosure prevents discovery of the TILA violation.
- The court ruled that the limitations period may be tolled until the borrower discovered, or had a reasonable opportunity to discover, the alleged fraud or nondisclosures forming the basis of the TILA claim.
- The court concluded genuine issues of material fact existed as to when plaintiffs discovered or reasonably should have discovered the alleged violation, making summary judgment improper.
- The court also held that genuine issues of material fact precluded summary judgment on the related Ohio common-law claims, including whether the bank misrepresented or failed to disclose the effective cost of credit and whether plaintiffs relied and suffered damages.

## Legal Principles

- Equitable tolling may apply to TILA’s one-year limitations period where the alleged violation is concealed by fraud or nondisclosure, delaying a borrower’s reasonable opportunity to discover it.
- When discovery and reasonable diligence are disputed, accrual and tolling questions ordinarily present factual issues not suited for resolution on summary judgment.
- Allegations that a lender’s interest-calculation method makes disclosed credit terms materially inaccurate can support both TILA disclosure claims and state-law fraud-type claims, subject to proof of the required elements.
- State-law claims arising from the same conduct must be evaluated under their own elements and defenses; they are not automatically barred simply because a federal TILA limitations defense is asserted.

## Conclusion

The Ohio Supreme Court held that TILA’s one-year limitations period can be equitably tolled where alleged fraud or nondisclosure prevents timely discovery of a disclosure violation, and it reversed summary judgment because factual disputes remained regarding discovery, the accuracy and materiality of disclosures tied to the 365/360 method, and the elements of plaintiffs’ Ohio common-law claims.


Hamilton v. Ohio Sav. Bank, 70 Ohio St. 3d 137, 637 N.E.2d 887 (Ohio 1994)