Court of Appeal (Cal.) Holds (again) that Rosenthal Act’s Cure Provision Has Teeth

In Timlick v. Ncb Mgmt. Servs., No. A152467, 2019 Cal. App. Unpub. LEXIS 4895 (July 23, 2019), the Court of Appeal in an unpublished decision applied the Rosenthal Act’s cure provision to a type-size violation.

Plaintiff argues that section 1788.30(d)’s cure provision does not apply to NCB’s type-size violation for the following reasons. First, section 1788.30(d) was repealed when the Legislature enacted section 1788.17 to harmonize  the Rosenthal Act with the FDCPA. Second, the cure provision applies only to violations under the title of the Civil Code in which it is codified (title 1.6C) and has no application to NCB’s section 1812.701(b) violation, which falls under title 2.97. Third, NCB’s type-size violation is not one “which is able to be cured” within the meaning of section 1788.30(d) because the Consumer Collection Notice law requires compliance in the debt collector’s first written communication to the consumer debtor. We addressed and rejected these contentions in Timlick, supra, 35 Cal.App.5th at pages 682-685. The parties in this action were given an opportunity to address Timlick’s effect on the issues here, and their supplemental briefing has been considered. As we explain below, plaintiff offers no legal authority or rationale supporting a different outcome here.4 Plaintiff first contends Timlick erred by citing the 2003 legislative history of the Consumer Collection Law to discern the legislative intent behind enacting section 1788.17 in 1999, as “[t]he declaration of a later Legislature is of little weight in determining the relevant intent of the Legislature that enacted the law.” (Jones v. Lodge at Torrey Pines P’ship (2008) 42 Cal.4th 1158, 1171 (Jones).) This argument is off the mark. In analyzing whether section 1788.17 repealed section 1788.30(d)’s cure provision so as to eliminate the curability of requirements imposed by the Consumer Collection Notice law, Timlick looked first to section 1788.17’s plain language and then to its legislative history. (Timlick, supra, 35 Cal.App.5th at pp. 682-684.) Our review disclosed nothing indicating an intent by the Legislature to repeal section 1788.30(d). (Timlick, at p. 683.) Only then did Timlick observe—with the qualification that the legislative history of the later-enacted Consumer Collection Notice law had no bearing on the legislative intent of section 1788.17—that the Legislature’s continued references to the cure provision four years after enacting section 1788.17 were logically inconsistent with the notion of repeal. (Timlick, at p. 684.) Our analysis in Timlick did not place significant weight on the comments made in the legislative history of the Consumer Collection Law, and therefore did not run afoul of the principle articulated in Jones. Plaintiff further argues that because type-size compliance must be made in the first written communication with the debtor, a subsequent collection letter simply cannot restore the debtor to the position he or she was in before receiving the initial communication. In support, he cites several federal decisions in which the courts held, for differing reasons, that a communication in violation of the FDCPA [*6]  could not be cured or corrected. (Arroyo v. Solomon & Solomon, P.C. (E.D.N.Y. Nov. 7, 2001, 99-CV-8302 (ARR)) 2001 U.S.Dist. Lexis 21908, *37-38 [refusing to apply cure provisions of Higher Education Act of 1965, 20 U.S.C.S. § 1071 et seq. to FDCPA]; Donohue v. Quick Collect, Inc. (9th Cir. 2010) 592 F.3d 1027, 1032, fn. 1 [noting that sections 1692e and 1692f of FDCPA do not permit unlawful representations to be corrected by later communications]; Eads v. Wolpoff & Abramson, LLP (W.D.Tex. 2008) 538 F.Supp.2d 981, 986 [debt collector who filed state court petition seeking to recover more than actual value of debt could be liable under FDCPA even though petition was amended].) Based on these authorities, plaintiff argues the Rosenthal Act should not be interpreted in a way that deviates from the interpretations of its federal analog. But these federal cases are clearly distinguishable due to the absence of a cure provision in the FDCPA. While the FDCPA and the Rosenthal Act both provide debt collectors with a statutory defense for nonintentional violations that result notwithstanding the maintenance of procedures reasonably adapted to avoid such violations (15 U.S.C. § 1692k(c); § 1788.30, subd. (e)), plaintiff cites no provision in the FDCPA analogous to section 1788.30(d) that provides debt collectors with a window of time to correct curable violations of the FDCPA. Therefore, the foregoing federal decisions provide no guidance for interpreting a defense that is [*7]  unique to the Rosenthal Act. Plaintiff also relies on the Ninth Circuit Court of Appeals’ decision in Romero v. Dep’t Stores Nat’l Bank (9th Cir. 2018) 725 Fed.Appx. 537 (Romero)—a case we, too, cited in Timlick but without elaboration. (See Timlick, supra, 35 Cal.App.5th at pp. 683, fn. 5, 684-685, fn. 6.) Romero held that a Rosenthal Act violation is not curable within the meaning of section 1788.30(d) “if the creditor cannot undo the harm to a debtor that its violation has already caused.” (Romero, at p. 539.) “That California would require a creditor to return a debtor to the position she was in before the Rosenthal Act violation in order to ‘cure’ that violation finds support in other contexts, where future compliance is an insufficient ‘cure’ if the ill effects of a violation have not been or cannot be remedied. [Citations.] Because the Banks’ violation here is the type that has allegedly caused harm like interruption of Romero’s solitude, which cannot be cured merely by ceasing calls going forward, the district court erred in granting judgment for the Banks on this claim on the basis of the mere assertion of the defense.” (Id. at p. 540.) Romero does not support plaintiff’s position, as the Ninth Circuit’s analysis focused on the “harm” and the “ill effects” caused by the violation in determining whether it was curable within the meaning of section 1788.30(d). (Romero, supra, 725 Fed.Appx. at pp. 539-540.) In this [*8]  sense, the violation and the harm are not one and the same. Indeed, if it were otherwise, no Rosenthal Act violation could be cured. Instead, section 1788.30(d) would be rendered a nullity because the debtor could never be returned to a state in which the violation never occurred. Plaintiff did not allege in his complaint or submit evidence in opposition to the summary judgment motion that he suffered any harm resulting from the type-size violation in NCB’s initial collection letter, and he likewise disclaimed any consequent harm at oral argument. He does not claim, for example, that he was unable to enforce his rights as a debtor due to the illegibility of the disclosures in the initial collection letter. On this record, then, the type-size violation did not cause a harm or ill effect that could not be undone (see Romero, at p. 540), and the violation was therefore one that was curable by a timely and type-size-compliant follow-up letter. Thus, we conclude section 1788.30(d) allowed NCB to cure its violation of section 1812.701(b).