124 Misc. 2d 162 | N.Y. Sup. Ct. | 1984
OPINION OF THE COURT
In an action for damages based on defendant’s alleged violation of the Truth in Lending Act (US Code, tit 15, § 1601 etseq.), defendant moves to dismiss the complaint as failing to state a cause of action (CPLR 3211, subd [a], par 7). Since issue has been joined, the motion is deemed one for summary judgment. (See Smith v Russell Sage Coll., 54 NY2d 185, 191.)
The sole issue on this motion is whether section 1666 of title 15 of the United States Code is applicable to any extension of consumer credit or only to open-end consumer credit plans (US Code, tit 15, § 1602, subd [i]), commonly known as credit card or charge card accounts.
The Fair Credit Billing Act added a number of provisions to the Truth in Lending Act (TILA) (Pub L 90-321, tit I, 82 US Stat 146). A primary provision, and the one at issue in this case, is subdivision (a) of section 161 (as added by 88
Defendant claims that the requirements under section 1666 of title 15, however, are inapplicable to the facts and circumstances of this case. The sole ground for this argument is that section 1666 of title 15 is strictly limited to open-end consumer credit plans and does not establish procedures for billing disputes that may arise in any or all consumer debtor-creditor situations. Consequently, since the instant credit transaction is concededly not an open-end consumer credit plan transaction, defendant argues that it had no obligation to comply with section 1666 of title 15 of the United States Code, and, thus, as a matter of law, cannot be cast in damages by reason of section 1640 of title 15. The court agrees.
The primary consideration of the courts in the construction of statutes is to ascertain and give effect to the intention of the Legislature. (McKinney’s Cons Laws of
Where, however, after a reading of the statute, its meaning is still not clear, courts must search for legislative intent in the purpose of the enactment, and from such facts and through such rules as may, in connection with the language, legitimately reveal it. (Matter of Schwartz v Lefkowitz, 21 AD2d 13.) To this end, it has been held that in the judicial construction of statutes it is relevant to consider the history of an act. Indeed, the purpose and applicability of a statute should be based on a consideration of its legislative history, and it has been held that legislative history is not to be ignored, even if words be clear. (See McKinney’s Cons Laws of NY, Book 1, Statutes, § 124, and cases cited therein.)
The Fair Credit Billing Act (US Code, tit 15, § 1666) does not expressly limit its application to open-end credit transactions. That is, there is no clear and unambiguous language in the statute stating that the procedures established thereby are solely for the correction of billing errors relating to such open-end transactions. Nevertheless, the statute reads in relevant part: “If a creditor, within sixty days after having transmitted to an obligor a statement of the obligor’s account in connection with an extension of consumer credit, receives at the address disclosed under section 1637(b)(10) of this title a written notice * * * indicating] the obligor’s belief that the statement contains a billing error * * * the creditor shall [take certain specified steps]”. (US Code, tit 15, § 1666, subd [a], par [2]; emphasis added.) A billing error notice, as indicated by the emphasized language of the statute, is to be sent to the creditor’s
Finally, the legislative history of the Fair Credit Billing Act (US Code, tit 15, § 1666 et seq.) shows that it amended
The Fair Credit Billing Act was amended in 1980 by the Truth in Lending Simplification and Reform Act (94 US Stat 132, tit VI). When the 96th Congress was considering this reform legislation, it had before it Regulation Z of the Federal Reserve Board. In fact, the legislative history of the 1980 act makes specific reference to Regulation Z and demonstrates that the Congress gave careful consideration to its provisions (1980 US Code Cong & Administrative News, pp 236,269-270). Consequently, the court must infer that, not having taken the opportunity to overrule or otherwise limit the Federal Reserve Board’s interpretation in Regulation Z of section 1666 of title 15 of the United
Wherefore, the court holds that section 1666 of title 15 is only applicable to transactions under open-end credit plans, as defined by section 1602 (subd [i]) of title 15 of the United States Code; that, since the transaction in suit was not under such a credit plan, defendant was not obligated to comply with the billing error correction procedures of section 1666 of title 15; that defendant’s noncompliance therewith could not serve as a basis for civil liability under section 1640 of title 15, and, since section 1640 is the sole basis for liability herein, that the complaint has, therefore, failed to state a cause of action.
Accordingly, motion granted in its entirety; summary judgment dismissing the complaint and action granted, and the complaint and action are dismissed.