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LAWRENCE v. FRANKLIN INV. CO.

December 12, 1978

Gladys C. LAWRENCE, Plaintiff,
v.
FRANKLIN INVESTMENT CO., INC., et al., Defendants



The opinion of the court was delivered by: OBERDORFER

MEMORANDUM

I. Introduction

 This action requires the Court to examine a transaction in which a used 1973 automobile was sold by defendant Sons Auto Center, Inc. ("Sons") to plaintiff Gladys Lawrence, in order to determine its conformity with the requirements of two consumer protection statutes, the Truth-in-Lending Act, 15 U.S.C. 1601 Et seq., and the Federal Motor Vehicle Information and Cost Savings Act, 15 U.S.C. § 1981 Et seq. (the "Odometer Act"). Plaintiff purchased her car in May, 1977 from Sons, a company which at that time conducted business under the name of Monroe's Automotive Center, and signed an installment contract calling for payments over a twenty-four month period. Also named as defendants in the action are Franklin Investment Co., Inc. ("Franklin"), lienholder of the car and the creditor to whom the installment contract was assigned, and the bonding company of Sons, Western Surety Company, and of Franklin, Reliance Insurance Company. The action is before the Court on cross-motions for summary judgment.

 In Count I, plaintiff claims that defendants failed to make the disclosures required by the Truth-in-Lending Act, and the regulations thereunder, Reg. Z, 12 C.F.R. part 226, citing six examples of that failure; in a supplemental memorandum in support of her motion for summary judgment, a seventh is advanced. In Count II, plaintiff alleges that defendants failed to disclose odometer information in the manner required by the Odometer Act and the regulations thereunder, 49 C.F.R. 580.1, Et seq., and that defendant Sons violated those disclosure requirements with the fraudulent intent necessary for liability under 15 U.S.C. § 1989. What defendant did and did not disclose and the manner of its disclosures may be determined by reference to the various documents surrounding the sale and is therefore not in dispute. The following findings of fact are drawn from those documents, as well as the parties' statements of genuine issues and facts not in dispute. For convenience, those findings and the conclusions of law are subdivided according to the specific violations alleged. Based upon those factual findings, the Court concludes that defendants violated the disclosure requirements of the Truth-in-Lending Act in at least two instances; summary judgment will therefore be entered for plaintiff on Count I. Penalty for violation of the Act is not cumulative so that the foregoing conclusion obviates examination of the remaining five allegedly improper disclosures. As to Count II, the Court concludes that plaintiff presents no allegations which, if proved, would permit a finding of the intent to defraud necessary for liability under § 1989. Therefore, summary judgment will be entered for defendants on Count II.

 II. Findings of Fact

 A. Alleged Failure Properly To Disclose Sons As Creditor

 1. Sons was a creditor of plaintiff within the meaning of the Truth-in-Lending Act. (Sons Answer, p. 2).

 2. 12 C.F.R. § 226.8(a) provides that:

 
At the time disclosures are made, the creditor shall furnish the customer with a duplicate of the instrument or statement by which the required disclosures are made and on which the creditor is identified.

 3. On the Disclosure Statement furnished to plaintiff, the seller is identified as Monroe's Automotive Center, 2001 West Virginia Avenue, N.E., Washington, D.C. 20002. (Disclosure Statement attached to Franklin Motion For Summary Judgment.)

 4. Monroe's Automobile Center was the trade name for Sons, a District of Columbia corporation. (Sons and Western Joint Statement of Genuine Issues, p. 1.)

 B. Alleged Failure Properly To Identify Franklin

 5. 12 C.F.R. § 226.6(d) provides:

 
If two or more creditors . . . make a joint disclosure, each creditor . . . shall ...

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