Hemphill v. S & Q Clothiers

• Decision Date: 29 March 1979
• Docket Number: No. 18081,18081
• Citation: 579 S.W.2d 564
• Parties: Robert E. HEMPHILL, Appellant, v. S & Q CLOTHIERS, Appellee.
• Court: Texas Court of Appeals

Page 564

579 S.W.2d 564

Robert E. HEMPHILL, Appellant, v. S & Q CLOTHIERS, Appellee.

No. 18081.

Court of Civil Appeals of Texas, Fort Worth.

March 29, 1979.

Bowmer, Courtney, Burleson & Pemberton and Karen M. Neeley, Temple, for appellant.

Burrows & Cure and James O. Cure, Temple, for appellee.

OPINION

SPURLOCK, Justice.

This is an appeal from a take nothing judgment. Robert E. Hemphill, debtor on a retail sales account, counterclaimed the sworn account action of the creditor on the account. The counter-claim alleged a violation of disclosure provisions of the Fair Credit Billing Act, 15 U.S.C. § 1637(a)(8) (Supp.1978). The trial court without a jury found no violation. It rendered judgment for the creditor for the amount of the account, plus finance charges and attorney's fees, and that the debtor take nothing by his counter-claim. The debtor does not appeal the portion of the judgment against him for the amount of the account plus finance charges. He appeals only the portions of the judgment that he take nothing and the award of attorney's fees.

We affirm in part and reverse and remand in part.

Hemphill applied for a retail charge account with S & Q Clothiers. S & Q approved his application and opened an account for him in 1973. Credit was extended for retail purchases made, and finance charges were assessed.

Although there were some months in which payment was not made, Hemphill was consistent in making payments on his account between June 1973 and October 1975. After October 1975 Hemphill became less consistent in making payments. He stopped making payments in January 1977, but the exact date collection procedures were instituted is the ultimate fact question raised by Hemphill's appeal and is disputed. However, S & Q filed its sworn account suit against him on November 15, 1977.

Hemphill bases his counter-claim on the fact that he never received a notice from S & Q outlining his right to claim his bill was erroneous and the procedure to follow in making such a declaration. This notice is required to be sent semiannually by creditors to debtors having current open end credit accounts. 15 U.S.C. § 1637(a)(8) (Supp.1978). The contents of the required notice is contained in 12 C.F.R. § 226.7(a)(9) as follows:

"IN CASE OF ERRORS OR INQUIRIES ABOUT YOUR BILL

"The Federal Truth in Lending Act requires prompt correction of billing mistakes.

"1. If you want to preserve your rights under the Act, here's what to do if you think your bill is wrong or if you need more information about an item on your bill:

"a. Do not write on the bill. On a separate sheet of paper write . . . the following:

"i. Your name and account number (if any).

"ii. A description of the error and an explanation . . . why you believe it is an error.

". . .des

"iii. The dollar amount of the suspected error.

"iv. Any other information . . . which you think will help the creditor to identify . . . the reason for your complaint or inquiry. . . ."

S & Q admits they never sent Hemphill any notice concerning his right to dispute his bill. It claims no notice was required because at the time the requirement became effective, delinquency collection procedures had been instituted on his account. The disclosure requirement became effective October 28, 1975. 12 C.F.R. § 226.7(i) covers open end credit accounts in existence on effective date of the disclosure requirement and provides as follows:

"(i) Open end credit accounts existing on October 28, 1975. In the case of any open end credit account in existence and in which a balance of more than $1 is outstanding at or after the closing date of the creditor's first full billing cycle after October 28, 1975, and which account is deemed to be collectible and with respect to which delinquency collection procedures have not been instituted, the items described in paragraph (a) of this section, to the extent applicable and not previously required to be disclosed to the customer, shall be disclosed in the form prescribed in paragraph (a) of this section, and mailed or delivered to the customer not later than the time of mailing or delivery of the periodic statement required under paragraph (b) of this section for that billing cycle."

A thorough review of the fair credit billing notice provisions reveals that under the facts here S & Q was not required to give the notice if Hemphill's account was deemed uncollectible or if delinquency collection procedures had been instituted. It is our opinion that once it was established that Hemphill was a debtor under an open end type credit account and S & Q admitted having not sent him any of the notices, S & Q had to prove Hemphill's account was past due and that it had either deemed it uncollectible or had instituted delinquency collection procedures. In our opinion placing the burden on S & Q is consistent with the spirit of the act. Also, S & Q would have knowledge of the relevant facts.

Both parties have erroneously assumed that no findings of fact were made by the trial court. S & Q so states in its brief and claims that we must affirm the judgment on any theory that could sustain the judgment which is supported by the pleadings and evidence. It asks us to assume the trial court's findings support its judgment. This might be correct if there were no findings made. However, the trial court recited in its judgment the findings of fact upon which it relied. Findings of fact are usually made separately from the judgment upon the request of the party desiring to appeal the case. In our opinion this is the best practice. However, findings of fact recited in the judgment can meet the requirement of filing findings of fact. 4 McDonald, Texas Civil Practice § 16.05 (1971). We conclude the findings of fact recited in this judgment are to be given the same consideration as if they had been separately filed. The fact that they were unrequested is immaterial in this case.

Because the judgment states it was based on the findings recited therein, we may not make any assumptions or implications concerning findings or theories which may support the judgment. We cannot imply or assume the trial court found that S & Q deemed Hemphill's account uncollectible. We may consider only the finding that it had instituted delinquency collection procedures on his account before the billing error notice became effective.

Hemphill asserts two points of error in complaint of the portion of the judgment that he take nothing. They are as follows:

1. "The trial court reversibly erred by failing to find as a matter of law that Appellant was entitled to recovery against Appellee for Appellee's violation of the Fair Credit Billing Act, 15 U.S.C. § 1601 et seq., through Appellee's failure to send Appellant 'billing rights notices' as required.

2. "The trial court reversibly erred in that its implied finding that Appellant was not entitled to recover against Appellee for Appellee's violation of the Fair Credit Billing Act, 15 U.S.C. § 1601 et seq., was contrary to the weight and preponderance of the evidence."

These points fail...