Good Housekeeping Shop v. Hines

• Decision Date: 14 July 1978
• Docket Number: No. 55546,55546
• Citation: 247 S.E.2d 142,146 Ga.App. 713
• Parties: GOOD HOUSEKEEPING SHOP v. HINES.
• Court: Georgia Court of Appeals

Page 142

247 S.E.2d 142

146 Ga.App. 713

GOOD HOUSEKEEPING SHOP v. HINES.

No. 55546.

Court of Appeals of Georgia.

Argued Feb. 28, 1978.

Decided June 20, 1978.

Rehearing Denied July 14, 1978.

R. John Genins, Atlanta, for appellant.

Ralph Goldberg, Atlanta, for appellee.

BIRDSONG, Judge.

Appellant brought suit against appellee, alleging an account indebtedness arising out of four retail installment sales contracts. Appellee answered, setting forth affirmative defenses, denying any indebtedness, and counterclaimed, alleging that the contracts sued upon were in violation of certain regulations established by the Truth in Lending Act, 15 U.S.C.A., § 1601 et seq., thereby entitling appellee to the civil remedies afforded by 15 U.S.C.A., § 1640. The trial court denied appellant's motion for summary judgment as to the account indebtedness and granted appellee's motion for summary judgment as to her counterclaim reserving for jury determination the issue of reasonable attorney fees pursuant to 15 U.S.C.A., § 1640. Held :

1. Inasmuch as issues of fact remained as to the existence, amount, and applicability of pleaded defenses to the alleged account indebtedness, the trial court's denial of appellant's motion for summary judgment as to these issues were proper. Lewis v. C. & S. Nat. Bank, 139 Ga.App. 855, 229 S.E.2d 765.

2. The Truth in Lending issue raised by appellee's counterclaim involves ". . . the complex disclosure requirements of the Truth in Lending Act and the regulations promulgated thereunder. 15 U.S.C.A. § 1601 et seq. and Federal Reserve Board Regulation Z, 12 CFR § 226.1 et seq." Pennino v. Morris Kirschman & Co., 526 F.2d 367, 369 (5th Cir. 1976). Appellant contends that the nomenclature requirements of 12 CFR § 226.8, subsections (b)(3) ("total of payments"), (c)(1) ("cash price"), (c)(3) ("unpaid balance of cash price"), and (c)(7) ("amount financed"), are general rather than specific, and that strict compliance therewith is not required. However, this contention is controlled adversely by Pennino v. Morris Kirschman & Co., supra, where it was stated by Attorney General (then Judge) Bell: "The requirements of § 226.7(b)(9) are quite technical, but Congress did not intend creditors to escape liability where only technical violations were involved (failure to use the term 'new balance'). As stated in Powers v. Sims & Levin Realtors (E.D.Va.1975), 396 F.Supp. 12, 20 (failure to use the term 'Finance Charge.') (sic). 'Indeed, the technical requirements of the act must be strictly enforced if the goal of standardization of terms, which is a requisite if consumers are to be able to make meaningful comparisons of available credit alternatives, is to be achieved.' " Id., p. 370.

This court agrees with the position taken in Pennino and therefore finds that appellant's failure to comply strictly with the above-cited nomenclature requirements of the Truth in Lending Act constitutes violation thereof. See Houston v. Atlanta Fed. Savings & Loan Assn., 414 F.Supp. 851 (N.D.Ga.1976). The trial court did not err in granting summary judgment as to appellee's counterclaim.

3. Appellant contends that the trial court erred in failing to grant its writ of possession. The undisputed evidence shows that, at the time appellant sought to foreclose its security interest, appellee was not "in default" for the reason that the amount owing on the contract was offset by the amount of the finance charge, as discussed in Division 2. Smith v. Society Nat. Bank, 143 Ga.App. 370, 238 S.E.2d 739; Harrison v. Goodyear Serv. Stores, 137 Ga.App. 223, 223 S.E.2d 261. Appellant's application to foreclose was therefore...