explaining that the Court "has often repeated the general proposition that considerable respect is due the interpretation given [a] statute by the officers or agency charged with its administration. . . . This traditional acquiescence in administrative expertise is particularly apt under TILA, because the Federal Reserve Board has played a pivotal role in setting [the statutory] machinery in motion. . . ."
How later courts described this case
- explaining that the Court "has often repeated the general proposition that considerable respect is due the interpretation given [a] statute by the officers or agency charged with its administration. . . . This traditional acquiescence in administrative expertise is particularly apt under TILA, because the Federal Reserve Board has played a pivotal role in setting [the statutory] machinery in motion. . . ."
- recognizing that where a statute and official regulation, such as the Truth in Lending Act, 15 U.S.C. § 1601 et seq., and Regulation Z, 12 C.F.R. 226.8, leave gaps in the regulatory scheme, it is appropriate for the courts to defer to interpretation of the proper regulatory agency and its staff
- stating that when the question presented “is not governed by clear expression in the . . . regulation . . . it is appropriate to defer to the Federal Reserve Board and staff in determin ing what resolution of that issue” is appropriate
- holding that deference was appropriate to official staff opinions of Federal Reserve Board interpreting the Truth in Lending Act and Regulation Z, unless demonstrably irrational
Written by the judges who cited it.
The opinion
Mr. Justice Blackmun,
with whom The Chief Justice joins, concurring.
I join the Court’s opinion but write separately because I do not fully agree with the statement in note 13 of the opinion, ante, at 569, that the Federal Reserve Board’s approach to the disclosure of acceleration rebates is “equally logical” with other alternatives it might have chosen. In particular, I am concerned that the Board’s emphasis on a creditor’s rebate policy rather than its contract rights steers the Truth in Lending Act away from the moorings of contract law in a manner that may not prove salutary for the welfare of consumers of financial credit.
To be sure, consumers contemplating installment purchases are concerned with the “bottom line,” ante, at 569, of how much they will be required to pay. But there is little doubt, in my view, that consumers who read the required disclosures *571 think that they are reading a description of their legal rights and obligations, and not merely an explanation of “practices” or “policies” of the creditor that may be changed to their detriment at the creditor’s will. Although there may be reason to believe that a major finance company, such as Ford Motor Credit Co., will adhere to its rebate practices despite the legal right to demand more upon acceleration than it said it would, I am not sanguine that a less responsible organization always will do the same. The result could be confusion and unanticipated financial loss, as well as fruitless litigation.
Ultimately, I think the interpretation adopted by the Fifth Circuit in McDaniel v. Fulton Nat. Bank, 571 F. 2d 948 (en banc), clarified, 576 F. 2d 1156 (1978) (en banc), which requires disclosure of the creditor’s right to retain finance charges upon acceleration when it differs from the right to such charges upon prepayment, may prove to be a sounder and more durable application of the statute than the position currently adopted by the Board. Nevertheless, I agree with the Court that the Board’s approach is reasonable. In order to uphold the Board’s position, “we need not find that its construction is the only reasonable one, or even that it is the result we would have reached had the question arisen in the first instance in judicial proceedings.” Udall v. Tollman, 380 U. S. 1, 16 (1965), quoting Unemployment Comm’n v. Aragon, 329 U. S. 143, 153 (1946). Accordingly, I agree that the courts should not add to the disclosure obligations that the Board has outlined through its staff opinions.