Bury v. Marietta Dodge
| Decision Date | 06 December 1982 |
| Docket Number | No. 82-8282,82-8282 |
| Citation | 692 F.2d 1335 |
| Parties | 12 Fed. R. Evid. Serv. 265 Monica BURY, Plaintiff-Appellant, v. MARIETTA DODGE, Defendant-Appellee. Non-Argument Calendar. |
| Court | U.S. Court of Appeals — Eleventh Circuit |
Ralph Goldberg, Atlanta, Ga., for plaintiff-appellant.
Greene, Buckley, DeRieux & Jones, Gregory J. Digel, Atlanta, Ga., for defendant-appellee.
Appeal from the United States District Court for the Northern District of Georgia.
Before TJOFLAT, JOHNSON and HATCHETT, Circuit Judges.
In this Truth in Lending Act case, we must determine what weight is to be given unofficial opinions of Federal Reserve Board staff members. Following precedent, we affirm the trial court's ruling that controlling weight is not to be given to these unofficial opinions.
Appellant, Monica Bury, entered into a consumer credit transaction with appellee, Marietta Dodge (Dodge), an automobile dealership. In August, 1980, Bury began a civil action against Dodge in the district court, alleging that her consumer contract with Dodge was violative of the Truth in Lending Act. She alleged that Dodge had not made the credit disclosures required by the statute. Title 12 C.F.R. Sec. 226.8(b)(4) requires that a lender advise the borrower in a consumer credit transaction of any default or delinquency charge. * In the contract Bury and Dodge moved for summary judgment. The magistrate recommended that Dodge's motion for summary judgment be granted. Applying a Fifth Circuit case, the magistrate found that post-maturity interest is not a default or delinquency charge if the rate of interest is equal to or less than the interest rate of the loan itself. Whitfield v. Termplan, Inc., 651 F.2d 383, 385 (5th Cir.1981). In this case, the highest lawful contract rate for the post-maturity interest, 10.5%, is below the annual contract percentage rate of 14.35%. Therefore, according to Whitfield, the post-maturity rate in this instance was not a default charge which need be disclosed under the regulations. The district court approved the recommendation of the magistrate.
the annual percentage rate revealed to the borrower on the face of the contract is 14.35%. Bury contends that on the reverse side of the contract the lender is given the right to recover on any deficiency at the highest lawful contract rate, which in Georgia means that the lender may recover simple interest at the rate of 10.5% on any deficient amount. The contract does not specify on its face that the highest lawful contract rate in Georgia is 10.5%.
Bury moved to alter or amend the judgment of the district court, attaching to her motion two informal letters by staff attorneys of the Federal Reserve Board. The staff attorneys in the unnumbered and unpublished letters take the position that an undisclosed provision allowing for the collection of interest after maturity is a default delinquency or similar charge payable in the event of late payment, and must be disclosed under 12 C.F.R. Sec. 226.8(b)(4). Bury argues that these unofficial letters are controlling upon the court. The district court disagreed, stating that unofficial, unpublished letters of staff attorneys on the Federal Reserve Board may not be given controlling weight simply because they are opinions of staff attorneys on the Board.
Bury argues on appeal that Whitfield v. Termplan, which held that undisclosed post-maturity interest rates did not violate the Truth in Lending Act where the rate was the same, or less, than the interest rate of the loan itself, should be overruled in light of subsequent case law. Bury contends that subsequent case law mandates that the Eleventh Circuit follow the opinions of the Federal Reserve Board, however expressed, unless "demonstrably irrational."
It is the contention of Bury that the two unofficial, unpublished staff attorney letters constitute valid opinions of the Federal Reserve Board which must be followed as they are not demonstrably irrational.
Dodge disagrees, and urges that it was not required to disclose on the face of the consumer contract its right to post-maturity interest where the rate of post-maturity interest is equal to or lower than the annual percentage rate of the consumer contract. Further, Dodge contends that the two unnumbered, unofficial, and unpublished Federal Reserve Board staff letters relied upon by Bury were not properly before the district court and were not properly admitted into the record on appeal and that there has been no authentication of the letters pursuant to Federal Rules of Evidence 901 and 902.
The issues we are called upon to decide are: (1) whether the two letters of the Federal Reserve Board have been entered into the record and therefore are properly before the court, and, (2) whether the two unofficial Federal Reserve Board letters which urge that post-maturity interest rates are to be considered default payments for purposes of disclosure under the Truth in Lending Act are to be given controlling weight by this court.
The Federal Rules of Evidence require that evidence presented to the court be authenticated. Federal Rule of Evidence 901(a) provides:
General provision. The requirement of authentication or identification as a condition precedent to admissibility is satisfied In this case, the copies of the two letters by staff attorneys have been initialed by Margaret Stewart, senior attorney of the regulations division of the Division of Consumer and Community Affairs at the Federal Reserve Board. Stewart has also affixed a certified affidavit to the letters attesting that they are true and accurate copies of letters sent by Federal Reserve Board attorneys on October 20, 1978, and July 28, 1978, to two different individuals, neither of them a party to this litigation. Additionally, counsel for Bury has also affixed to his motion to alter judgment, a certified affidavit attesting that these letters have been presented to him as true and correct copies of actual Federal Reserve Board letters.
by evidence sufficient to support a finding that the matter in question is what its proponent claims.
Federal Rule of Evidence 901 does not specify how a piece of evidence may be authenticated. Although section 901(b) illustrates various methods of authentication, these methods are not intended to be the only methods of authentication. Section 901(a) specifies only that the requirement of authentication is satisfied when there is evidence sufficient to support a finding that the matter is what the proponent claims it is. Here, the Federal Reserve Board sent copies of the letters to counsel for Bury. The Federal Reserve Board, through senior attorney Margaret Stewart, certified and attested that these letters are true and correct copies of actual letters sent by the Federal Reserve Board to other individuals. Additionally, counsel for Bury attests that these have been represented to him as true and correct copies. These appear to be reasonable methods of authentication, such that would reasonably attest that the two letters are what they purport to be.
Moreover, it is well to consider that admissibility of demonstrative evidence is largely within the discretion of the trial court. A determination of whether an article has been properly identified is an exercise of discretion which will not be disturbed unless there is no competent evidence in the record to support it. Meadows and Walker Drilling Co. v. Phillips Petroleum Co., 417 F.2d 378, 382 (5th Cir.1969). The trial court accepted the two letters as being true and correct copies of actual Federal Reserve Board staff letters. In doing so, the trial court properly exercised its discretion in the matter. We hold that the appended Federal Reserve Board letters are properly admitted into the record and are properly before this court.
We now turn to the question of whether Whitfield v. Termplan has been overruled.
The Truth in Lending Act requires that any undisclosed provision allowing for the collection of interest after maturity is a "default delinquency or similar charge payable in the event of late payment." 12 C.F.R. Sec. 226.8(b)(4). In the recent Truth in Lending Act case, Whitfield v. Termplan, the Fifth Circuit, applying section 226.8(b)(4), held that post-maturity interest at a rate equal to or less than the annual percentage rate is not a penalty. As support for this contention, the Fifth Circuit quoted from Federal Reserve...
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