Barlow v. Evans

• Decision Date: 04 August 1997
• Docket Number: No. Civ.A. 94-D-1319-N.,Civ.A. 94-D-1319-N.
• Citation: 992 F.Supp. 1299
• Parties: Barbara BARLOW, on behalf of herself and all others similarly situated, Plaintiff, v. Frank EVANS and Charlotte Evans, d/b/a Quik Pawn Shop, and EFS, Inc., Defendants.
• Court: U.S. District Court — Middle District of Alabama

Page 1299

992 F.Supp. 1299

Barbara BARLOW, on behalf of herself and all others similarly situated, Plaintiff, v. Frank EVANS and Charlotte Evans, d/b/a Quik Pawn Shop, and EFS, Inc., Defendants.

No. Civ.A. 94-D-1319-N.

United States District Court, M.D. Alabama, Southern Division.

August 4, 1997.

COPYRIGHT MATERIAL OMITTED

C. Knox McLaney, Montgomery, AL, J. Eric Vander Arena, Chicago, IL, Cathleen M. Combs, Chicago, IL, Lewis B. Hickman, Montgomery, AL, for Plaintiff.

Robert D. Segall, George W. Walker, III, Montgomery, AL, C. Michael McInnish, Montgomery, AL, A. William Loeffler, Alan E. Lubel, Scott, D. Riddle, Atlanta, GA, for Defendants.

MEMORANDUM OPINION AND ORDER

DE MENT, District Judge.

Pending before the court are defendants' motion for summary judgment and plaintiff's motion for partial summary judgment, filed March 9, 1995, and May 22, 1995, respectively. These motions have been briefed in detail. After careful consideration of the arguments of counsel, the relevant case law and the record as a whole, the court finds that defendants' motion is due to be granted in part and denied in part and that plaintiff's motion is due to be granted in part and denied in part.

JURISDICTION

Based upon 28 U.S.C. §§ 1331 and 1367, the court properly exercises subject matter jurisdiction over this action. The parties do not contest personal jurisdiction or venue.

FINDINGS OF FACT

Plaintiff Barbara Barlow ("Barlow") commenced this two-count action on September 14, 1994, in the Circuit Court for Montgomery County, bringing a claim for violation of the Federal Truth in Lending Act ("TILA"), 15 U.S.C. § 1601, et seq., and a state law claim of fraudulent suppression of material information required by TILA.¹ This action arises from two pawn transactions occurring between plaintiff Barbara Barlow ("Barlow") and defendant Quik Pawn Shop ("Quik Pawn") in which Barlow pawned her VCR and the title to her automobile. She brings this action on behalf of herself and all others similarly situated.

Owned by defendant EFS, Inc. ("EFS"), Quik Pawn is a pawn shop business with at least nine locations in Alabama. Defendant Frank Evans is president of EFS, and defendant Charlotte Evans is its secretary. Although EFS conducts business as Quik Pawn, none of the advertisements or documents provided to Barlow indicated the existence of EFS or the relationship between EFS and Quik Pawn. Quik Pawn generally engages in two types of pawn transactions: (1) the customer presents his or her motor vehicle title to Quik Pawn in exchange for a sum of money and a pawn ticket or (2) the customer delivers personal property to Quik Pawn in exchange for a sum of money and a pawn ticket. On all pawn transactions, customers are required to pay an "interest charge" of 25% on the loan before they may redeem their property ("redemption charge") and a 25% monthly charge ("renewal charge") on the principal balance each time the pawn ticket redemption date is extended. The effective annual percentage rate on such transactions ranges between 240% and 300%.

On July 8, 1994, in need of money "for personal purposes," Barlow "pawned" the title to her 1985 Buick with defendant Quik Pawn at the Norman Bridge Road location in Montgomery, Alabama, for a "loan amount" of $500.00. Retaining possession of her automobile, Barlow received a pawn ticket for her automobile title, which stated in pertinent part:

The pledgor may renew this pawn for an additional 30 days by paying $125.00, which is the monthly interest charge. The pledged goods shall be returned to the pledgor or an authorized representative upon payment of $625.00 due on or before 08/08/94. Early repayment does not entitle you to a refund of part of the interest. The monthly and annual interest rates are 251 and 300%.

You may make weekly payments of $156.25 with a final payment of $156.25.

Accordingly, Barlow's redemption charge for her automobile title was $625.00, and each of her monthly renewal charges was $125.00. On August 8, 1994, again in need of money, Barlow "pawned" her VCR with Quik Pawn for a loan amount of $75.00. The pawn ticket for the VCR stated in part:

The pledgor may renew this pawn for an additional 30 days by paying 15.00, which is the monthly interest charge. The pledged goods shall be returned to the pledgor or an authorized representative upon payment of $90.00 due on or before 09/08/94. ... The monthly and annual interest rates are 20% and 240%.

Accordingly, Barlow's redemption charge for her VCR was $90.00, and her monthly renewal charges were $15.00.

Barlow contends that the pawn tickets do not provide certain credit disclosures as required by TILA and implemented by Federal Reserve Board Regulation Z. Specifically, Barlow argues that the Quik Pawn tickets do not properly disclose the amount financed, the finance charge, or the annual percentage rate, using those terms, nor do they contain a separate itemization of the amount financed, the number, amounts and timing of payments scheduled to repay the obligation or the total of payments, using that term, and described as "the amount you will have paid when you have made all scheduled payments."² In addition to claiming these nondisclosures violate TILA, Barlow also argues that defendants' failure to make the necessary disclosures constitutes fraudulent suppression. Finally, Barlow insists that she is entitled to actual damages, which includes the value of her pawned items forfeited for nonpayment of the pawn or interest charges.

Defendants contend that TILA requirements do not apply to pawn transactions in Alabama because they are not considered credit transactions. Alternatively, defendants argue that if TILA does apply to pawn transactions in Alabama, then the pawn tickets are in compliance with TILA's requirements. Additionally, defendants contend that individual defendants Frank and Charlotte Evans are not subject to liability under TILA. In response to Barlow's demand for actual damages, defendants insist that the actual damages provided for in 15 U.S.C. § 1640 do not include the value of non-redeemed property. Finally, with regard to Barlow's claim of fraudulent suppression, defendants contend that the suppression claim is pre-empted by TILA. Defendants also argue, alternatively, that even if the suppression claim is not pre-empted by TILA, Barlow cannot show that any material facts were suppressed or that defendants had any intent to deceive Barlow.

Defendants have moved for summary judgment on all claims. Barlow has moved for a partial summary judgment on the issue of liability for violation of TILA. She also seeks a summary judgment finding that the measure of actual damages under TILA includes the value of the pawned item forfeited for nonpayment of the pawn or interest charges.

SUMMARY JUDGMENT STANDARD

On a motion for summary judgment, the court is to construe the evidence and factual inferences arising therefrom in the light most favorable to the nonmoving party. Adickes v. S.H. Kress & Co., 398 U.S. 144, 157, 90 S.Ct. 1598, 26 L.Ed.2d 142 (1970). Summary judgment can be entered on a claim only if it is shown "that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law." Fed.R.Civ.P. 56(c). As the Supreme Court has explained the summary judgment standard:

[T]he plain language of Rule 56(c) mandates the entry of summary judgment, after adequate time for discovery and upon motion, against a party who fails to make a showing sufficient to establish the existence of an element essential to that party's case, and on which that party will bear the burden of proof at trial. In such a situation, there can be no genuine issue as to any material fact, since a complete failure of proof concerning an essential element of the non-moving party's case necessarily renders all other facts immaterial.

Celotex Corp. v. Catrett, 477 U.S. 317, 322-23, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). The trial court's function at this juncture is not "to weigh the evidence and determine the truth of the matter but to determine whether there is a genuine issue for trial." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 249-50, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986) (citations omitted). A dispute about a material fact is genuine if the evidence is such that a reasonable jury could return a verdict for the nonmoving party. Anderson, 477 U.S. at 248; see also Barfield v. Brierton, 883 F.2d 923, 933 (11th Cir.1989).

The party seeking summary judgment has the initial burden of informing the court of the basis for the motion and of establishing, based on relevant "portions of `the pleadings, depositions, answers to interrogatories, and admissions in the file, together with affidavits if any,'" that there is no genuine issue of material fact and that the moving party is entitled to judgment as a matter of law. Celotex, 477 U.S. at 323. Once this initial demonstration under Rule 56(c) is made, the burden of production, not persuasion, shifts to the nonmoving party. The nonmoving party must "go beyond the pleadings and by [his] own affidavits, or by the `depositions, answers to interrogatories, and admissions on file,' designate `specific facts showing that there is a genuine issue for trial.'" Celotex, 477 U.S. at 324; see also Fed.R.Civ.P. 56(e).

In meeting this burden the nonmoving party "must do more than simply show that there is a metaphysical doubt as to the material facts." Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986). That party must demonstrate that there is a "genuine issue for trial." Fed.R.Civ.P. 56(c); Matsushita, 475 U.S. at 587. An action is void of a material issue for trial "[w]here the record taken as a whole could not lead a rational trier of fact to find for the nonmoving party." Matsushita, 475 U.S. at 587; see also Anderson, 477 U.S. at 249.

The court recognizes that TILA claims are often...