Jaaskelainen v. Wells Fargo Bank, N.A. (In re Jaaskelainen), 391 B.R. 627,645-46 (Bankr. D. Mass. 2008) (Hillman) (Debtors in bankruptcy have no obligation to tender funds received at defective mortgage closing as condition of rescission when debtors established violations of Massachusetts Consumer Credit Cost Disclosure Act. Debtors did not receive adequate notice of right of rescission, did not receive required number of copies of right of rescission, and lender failed to establish that its violation of notice requirements was result of bona fide error. As a result of rescission by debtors, mortgagee only holds unsecured claim. Although Massachusetts statute and Truth-in-Lending Act require as condition of rescission that borrower tender money loaned back to creditor, “‘Bankruptcy . . . relieves the debtor from his obligation to pay the creditor upon rescission. Conditioning rescission upon the debtor’s payment therefore imposes an obligation from which the debtor has been legally freed. Unlike the situation absent bankruptcy, there is a legitimate, legal impediment to the debtor’s reciprocal performance. It would be palpably unfair to deny the relief to which a consumer is entitled under TIL[A] because that consumer has also availed himself of bankruptcy relief. To do so would require that the consumer choose between bankruptcy and TIL[A], something neither form of statutory relief contemplates.’” Although debtors had no actual damages, they are entitled to statutory damages under Massachusetts statute of $1,000 each.).

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