Appeal from the United States District Court for the Northern District of Illinois, Eastern Division. No. 77 C 1876 - Julius J. Hoffman, Judge.
Fairchild, Chief Judge, Markey, Chief Judge, United States Court of Customs and Patent Appeals,*fn* and Bauer, Circuit Judge.
Plaintiffs bring this appeal from the district court's grant of defendant's motion for summary judgment in a civil action brought under the Interstate Land Sales Full Disclosure Act, 15 U.S.C. §§ 1701-17. Plaintiffs contend that the defendant developer violated 15 U.S.C. § 1703(a)(1) by selling them two lots without having filed a statement of record in accordance with 15 U.S.C. § 1706 and without having provided plaintiffs with a printed property report as required by 15 U.S.C. § 1707. The defendant answered, inter alia, that plaintiffs' action was barred by the statute of limitations specified in 15 U.S.C. § 1711. Plaintiffs then replied that the defendant was estopped by its conduct from relying on the statute of limitations. The district court disagreed, granted defendant's motion for summary judgment on the ground of the statute of limitations, and dismissed plaintiffs' cause of action. We reverse and remand the case for further proceedings.
Plaintiffs' complaint alleges that the defendant sold them two lots of land on August 4, 1973 without having effective statements of record and without providing plaintiffs with property reports for each lot as required by the Interstate Land Sales Full Disclosure Act, 15 U.S.C. § 1703(a)(1). On May 30, 1975, the defendant sent a letter to plaintiffs acknowledging that it had violated the Act, at least with respect to one lot, and informing plaintiffs that they could, if they wished, rescind the sale and receive a refund of any payments made in accordance with the sales contract. Plaintiffs immediately notified defendant that they elected to rescind and wished a refund of their payments. Their letter concluded:
"We expect you to contact us soon with the proper documents to be executed in order to reconvey said lot. . . ."
When the defendant did not promptly reply to the letter, plaintiffs telephoned the defendant on several occasions for the purpose of determining when their refund would be forthcoming. According to Annamarie Bomba's deposition, plaintiffs were told in July of 1975 that they would get their money back but that it would take time. This same assurance was made in subsequent phone calls throughout the course of 1975. Finally, in March of 1976, defendant's attorney wrote the Bombas a letter that indicated the defendant, in response to plaintiffs' request for rescission and a refund, would attempt to sell their lot and turn over the "net proceeds of sale" after deduction of various sales costs and commissions. Under the proposed agreement, the Bombas would release defendant from any and all claims in the event their lot was sold, even if the net proceeds of sale did not equal the amount of monies paid by plaintiffs pursuant to the sales agreement with defendant. The Bombas then consulted an attorney, who brought the present suit on May 28, 1977.
On appeal, the plaintiffs contend that the defendant is estopped by its conduct from relying on the statute of limitations contained in 15 U.S.C. § 1711. According to plaintiffs, by promising them a refund of their money, the defendant lulled them into a false sense of security that led them to refrain from bringing a timely suit. Thus, say plaintiffs, the defendant is estopped from relying on the statute of limitations defense under the principles set out in Glus v. Brooklyn Eastern Dist. Terminal, 359 U.S. 231, 3 L. Ed. 2d 770, 79 S. Ct. 760 (1959).
Defendant responds that the explicit language of 15 U.S.C. § 1711 supports the district court's ruling that the statute of limitations contained therein constitutes an absolute bar to plaintiffs' cause of action, for the statute says in no uncertain terms that
"In no event shall any [action to enforce a liability created by this Act] be brought by a purchaser more than three years after the sale or lease to such purchaser."
In ruling that defendant was entitled to judgment as a matter of law because of the applicable statute of limitations, the district court took the view that the explicit language of 15 U.S.C. § 1711 foreclosed application of the doctrine of equitable estoppel in suits brought under the Interstate Land Sales Full Disclosure Act more than three years after the allegedly illegal sale. In essence, the district court ruled that the "In no event" wording of 15 U.S.C. § 1711 placed an absolute bar on the ...