author: TALBOT SMITH, Senior District Judge.

text:
    Frances M. BONEBRAKE, Administratrix De Bonis Non of the Estate of Woodrow B. Simek, Deceased, Plaintiff-Appellee, v. Donald COX and Claude Cox, d/b/a Tamarack Bowl, Defendants-Appellants.
    No. 73-1730.
    United States Court of Appeals, Eighth Circuit.
    Submitted April 15, 1974.
    Decided July 2, 1974.

      Dennis M. Gray, Council Bluffs, Iowa, for defendants-appellants.
    Robert J. Laubenthal, Council Bluffs, Iowa, for plaintiff-appellee.
    Before HEANEY and STEPHENSON, Circuit Judges, and TALBOT SMITH, Senior District Judge.

       TALBOT SMITH, Senior District Judge, Eastern District of Michigan, sitting by designation.

   TALBOT SMITH, Senior District Judge.

This is an appeal from a judgment of $27,000 entered by the District Court on the recommendation of a Special Master in favor of the plaintiff, Frances M. Bonebrake, administratrix of the estate of Woodrow B. Simek (the seller), against the defendants, Donald and Claude Cox, d/b/a Tamarack Bowl (the buyers).

Plaintiff’s decedent had entered into two contracts with the Cox brothers for the sale and installation in defendants’ bowling alley of bowling equipment. The dispute arose when Simek died. At that time the delivery and installation were incomplete and less than half of the purchase price paid. The defendants obtained equipment elsewhere and hired others to finish the installation. Plaintiff’s suit to recover the balance of the contract price was met by defendants’ counterclaims for damages suffered. The Special Master rejected defendants’ counterclaims and their defense that Simek or his estate had breached the contracts first, and awarded plaintiff the balance due on the contracts ($28,000) less the value to the seller of unaccepted goods ($1,000).

The harshness of the result is conceded by the Special Master, but he felt himself constrained to such result by the provisions of the Uniform Commercial Code (the “Code”). It is indeed harsh that the defendants be required to pay the full contract price for the goods, and be denied in toto their counterclaim for .damages arising from their grossly defective condition. We are satisfied that the Code mandates no such result and that it has been misconstrued. Moreover, we are of the opinion with respect to an implied holding on a combined question of fact and law (anticipatory breach by Simek’s estate) that although there is some evidence to support the ruling, on the entire record we are “left with the definite and firm conviction that a mistake has been committed” and thus we are confronted with clear error. We reverse and remand.

In view of the fact that the application of the Code to the facts presented is essential to the resolution of the controlling issues on appeal we will describe the transaction before us in some detail.

The Cox brothers had for some 20 years run a bowling alley called the Tamarack Bowl in Missouri Valley, Iowa when, on February 5, 1968 it was gutted by fire. They determined to rebuild, and on April 17, 1968 entered into a written contract with Simek for the purchase of:

the following used equipment hereinafter set forth, installed in the Tamarack Bowl, on the ground floor, in Missouri Valley, Iowa.
10 Lane beds complete with one piece gutter, tail planks, kickbacks, etc.
5 Magic circle underlane ball returns
10 Score chairs
Fibre glass seating (for 10 lanes)
1 Streamline bubble ball cleaning machine
50 Lockers — 5 Radarays
63 Assorted house balls
3 Ball storage racks
50 Pair rental shoes
Foundation material
For the total price of $20,000.00.
* * * * * *
[Simek] will start construction work on or about May 15th, 1968 and further agrees to re-surface the lanes, and apply finish coats.

Simek’s principal place of business was in Ashland, Nebraska. He was the sole proprietor of a bowling alley and dealt in new and used bowling equipment. He owned storage facilities in Ashland, Mead and Greenwood, Nebraska. Simek hired one Ilert Avery, commonly known as “Blackie”, to install all the listed items except the balls and shoes. The first and principal job was to put the lanes in, but this was not begun until August, 1968, because the building had not yet been completed.

On August 23, 1968 the Cox brothers further contracted with Simek to purchase, for $35,000.00,

10 used Brunswick Model A pinspotters delivered and installed in the Tamarack Bowl, with motors and gear boxes carrying a one year guarantee.

No date was specified for the completion of either contract although it is clear that the Cox brothers were under considerable time pressure to have the deliveries and work under the contracts completed. Their sources of steady revenue were the local bowling leagues which, after the fire, had taken their business elsewhere. These leagues were organized under the rules of the American Bowling Congress and the Women’s International Bowling Congress which, call for the playing of four “rounds” of bowling over a thirty-six week schedule. Traditionally, league play at the Tamarack Bowl and other alleys begins in late August or early September in order to be completed before the summer months. The “volunteers” who are mentioned below were local league members who were anxious to see that the Bowl open in time for the fall season.

Simek hired Blackie to unload the machines and set them in place at the end of the lanes. On September 4 this work was complete, but, the Special Master found, the pinspotters had not been “installed” within the meaning of the contract. They were “not only inoperative, but [were] in a very poor condition.” Donald Cox testified that when he first saw the machines at the end of the lanes “they were kind of a mess. * * * On every machine pretty near every bearing was froze or had to have some attention or a lot of replacement parts. Lots of them.” With the help of volunteers and advice from Blackie repair work was immediately begun; the machines were dismantled and parts cleaned or' replaced. Blackie was clearly aware of the Cox brothers' dissatisfaction with the machines, but Simek died September 6 before they could communicate directly with him. Twenty thousand dollars had been paid on the pin-spotter contract.

With respect to the first contract, the Master found the following goods to be undelivered as of September 6:

1. 10 Score chairs
2. Fiberglass seating for 10 lanes
3. Streamline Bubble Ball Cleaning Machine
4. 50 Lockers
5. 63 Assorted house balls
6. 3 Ball storage racks
7. 50 Pair of rental shoes

The lane beds had been installed, and. the ball returns and “radarays” called for in the contract were delivered but not installed. Seven thousand dollars had been paid on this contract. With the help of Blackie, the Cox brothers immediately attempted to locate, and identify to the contract, the undelivered goods. These efforts will be discussed in more detail under our consideration of the buyers’ claim of anticipatory breach.

Meanwhile, the effort to repair the concededly defective pinspotters continued. About September 12 an altercation developed with Blackie who left the job. A number of bowling equipment specialists were immediately called in to complete the repair work and to finish the installation of the ball returns and the “radarays”. The defendants contacted a lawyer who drafted the following letter to plaintiff:

September 17, 1968
Mrs. Frances Bonebrake
Ashland, Nebraska
Dear Madam:
We represent Claude and Donald Cox, owners of the Tamarack Bowl in Missouri Valley who entered into a contract with your brother, Woodrow Simek for the purchase and installation of ten alleys complete and ten automatic pinsetters installed and complete.
At the time of Mr. Simek’s death he was engaged in the installation of said items and had the installation over half completed. Following his death the employees which were assisting in the installation left the job, and it was necessary for the Cox brothers to look elsewhere for the additional parts and supplies which had not been delivered, and to commence work on completing the installation of the alleys and pinsetters with such other help as they were able to obtain.
They are gradually locating and obtaining the necessary parts for repairing the pinsetters and are getting them installed, although this is going to result in a considerable delay beyond the date of completion, and which will, of course delay the commencing of the bowling season. It may result in requiring them to have shorter league seasons which will result in a substantial loss of income.
Mr. Donald Cox has recently talked with you about this and he told us that an Administrator has or will be appointed for his estate in Ashland, Nebraska.
The Cox brothers had paid Mr. Simek $27,500.00 at the time of his death on a total contract price of $55,000.00 covering the cost of the alleys and pinsetting equipment and the installation which included a guarantee as to the quality and performance of the equipment.
They hope to be able to complete the installation at a cost not greater than the contract price, but they will nevertheless no doubt sustain substantial loss caused by the delay and lateness in starting the bowling season.
The Cox brothers are greatly concerned about this, and among other things they are concerned about whether or not all of the equipment which has been delivered and partially installed had been paid for by Mr. Simek prior to his death.
Our clients are keeping an accurate record of all payments which have been made by them, or which are now being made by them in paying the cost of completing the installation, so that they can substantiate a claim for any loss which may be sustained. We wish to be advised as to what action has been taken concerning the probate of the estate of Mr. Simek, and the name of the attorney who will be taking care of this matter for you, and we would suggest that this letter be handed such attorney so that he will be aware of the position of our clients.
Very truly yours,
ACREA & PEARSON
K. C. Aerea
KCA/mas

Work proceeded on the job under the direction of the Cox brothers, the Bowl finally opening for business on October 14th. Subsequent to this date, the leagues could complete only three of the usual four rounds of play.

In the interpretation of the Code we are here called upon to construe, we are guided by its stated purposes and its self-contained rules of construction. We find in § 554.1102 that it is to be “liberally construed and applied to promote its underlying purposes and policies,” which are, among others, “to simplify, clarify and modernize the law governing commercial transactions.” The intent here was “simply that the law of commercial transactions be, so far as reasonable, liberal and nontechnical” and, to that end, that the Code “liberalize (‘de-technicalize’) important branches of commercial law.”

These canons of construction we find violated in the case before us in three major aspects: 1) the ruling that the Code’s requirements of notification were violated with respect to the defective pinspotting machines, thus causing the “harsh result” above described; 2) the ruling that the April contract did not fall under the Code because it was a “mixed” (goods and services) contract, and 3) the implied ruling that there was no anticipatory breach of the contracts by the seller during the time period immediately subsequent to the seller’s death. We will consider these seriatim.

I

With respect to the pinspotter contract the Master found that “[t]he term ‘installed’ in the [contract] required that the used equipment be placed in operational condition and amounted to a warranty for fitness under the U.C.C. * * * The pinspotting machines received by the Cox brothers before September 6, 1968 were defective and did not meet [this] warranty standard.” He held, however, that when the Cox brothers accepted the goods they were left with this alternative:

In order for them to maintain a cause of action for breach of warranty, it must be found that defendants notified Simek or his administrators of such non-conformities within a reasonable time (§ 554.2607(3) (a) and § 554.2605(1)(a)) and that, if the time for performance had not expired, they did not by their actions or failure to notify reasonably put it beyond plaintiff’s power to cure the defective performance * *

The Master found neither condition met:

The letter of September 17, 1968 * * * and the oral communications between the Cox brothers and Mrs. Bonebrake immediately following Simek’s death, failed to constitute notice of non-conformity * * *.
An offer by Simek’s administrators to complete the contract and to cure the defective machinery was made within the reasonable time for performance set by the contract and was wrongfully and unjustifiably rejected by the Cox brothers.

Consequently, he concluded that “the defendants waived their rights to warranty recovery.”

We agree with the defendant-buyers that the Master has confused the notice requirements of § 554.2607(3) (a) and § 554.2605(1). Section 554.-2607(3) (a) deals with the situation where, as in the case at bar, the buyer accepts nonconforming goods and sues for breach. It provides:

Where a tender has been accepted * * * the buyer must within a reasonable time after he discovers or should have discovered any breach notify the seller of breach or be barred from any remedy * * *.

Section 554.2605(1) deals with the situation where the buyer elects to reject nonconforming goods. It provides:

The buyer’s failure to state in connection with rejection a particular defect which is ascertainable by reasonable inspection precludes him from relying on the unstated defect to justify rejection or to establish breach
a. where the seller could have cured it if stated seasonably; or
b. between merchants when the seller has after rejection made a request in writing for a full and final written statement of all defects on which the buyer proposes to rely.

Comment 4 to § 2-607 makes clear the difference between the notice requirements of the two sections:

The content of the notification [under § 2-607(3)] need merely be sufficient to let the seller know that the transaction is still troublesome and must be watched. There is no reason to require that the notification which saves the buyer’s rights under this section must include a clear statement of all the objections that will be relied on by the buyer, as under the section covering statements of defects upon rejection (Section 2-605). Nor is there reason for requiring the notification to be a claim for damages or of any threatened litigation or other resort to a remedy. The notification which saves the buyer’s rights under this Article need only be such as informs the seller that the transaction is claimed to involve a breach, and thus opens the way for normal settlement through negotiation, [emphasis supplied.]

We find no merit to plaintiff’s contention that “the Special Master, in his opinion, never stated that the notice the appellant-seller [sic] must give where the buyer accepts the goods must specify the particular defect.” We hold that, measured by the proper standard, the letter of September 17 was sufficient under § 554.2607 to “notify the seller of breach” of the pinspotter contract. It explicitly states that the pinspotters were not installed within the meaning of the contract, that the pinspotters needed repairs although the contract “included a guarantee as to the quality and performance of the equipment,” and that the Cox brothers were keeping a record of their expenses “so that they can substantiate a claim for any loss which may be sustained.” This notice is more than adequate to “let the seller know that the transaction is still troublesome.” Lewis v. Mobil Oil Corp., 438 F.2d 500, 509 (8th Cir. 1971); Boeing Airplane Co. v. O’Malley, 329 F.2d 585, 593-596 (8th Cir. 1964).

Further, the Master erred in concluding that the Cox brothers “waived their rights to warranty recovery” by refusing to permit the seller to cure the defects in the pinspotters. The seller’s right to cure, as provided in § 554.2508, is in terms limited to the situation where nonconforming goods have been rejected by the buyer. Here, the defective pinspotters had been accepted and the buyer is attempting to recover damages. Again the Master imposed, as a precondition to any remedy at all, those requirements which condition only the most drastic of buyer’s remedies, rejection. While it may be true that the “most important reason for requiring notice [under § 2-607] is to enable the seller to make adjustments or replacements or to suggest opportunities for cure to the end of minimizing the buyer’s loss- and reducing the seller’s own liability to the buyer,” a buyer who has accepted nonconforming goods is under no duty to accept an offer of cure by the seller. His refusal to do so raises only the question of whether he has properly mitigated his damages; it does not extinguish entirely his right to recover.

II

We now consider whether the contract of April 17, 1968 comes under the Code. Its background we have noted. The fire suffered by defendant’s bowling alley on February 5, 1968 had destroyed its equipment. This contract with Simek was to replace those goods. The “following used equipment” was purchased: lane beds, ball returns, chairs, bubble ball cleaning machine, lockers, house balls, storage racks, shoes, and foundation materials. The equipment was to be delivered and installed by Simek. He warranted that the lanes would be “free from defects in workmanship and materials,” and that they would “meet all ABC specifications.” The purchase price was stated to be “for the total price of $20,000.00,” two thousand dollars payable upon the execution of the contract, another payment “when work begins laying sub-floor, or foundation material; and the balance upon completion of this installation.”

The language thus employed is that peculiar to goods, not services. It speaks of “equipment,” and of lanes free from “defects in workmanship and materials.” The rendition of services does not comport with such terminology.

The Master, however, ruled that the above-described contract “is not the type of contract which falls within the statutory scheme of the U.C.C. It involved substantial amounts of labor, as well as goods, with a lump sum price. The Code was meant to cover contracts for the commercial sale of goods, not non-divisible mixed contracts of this type.”

In such holding there is error. Article 2 of the Code, here involved, applies to “transactions in goods.” § 554.2102. The definition of “goods” is found in § 554.2105(1):

“Goods” means all things (including specially manufactured goods) which are movable at the time of identification to the contract for sale other than the money in which the price is to be paid, investment securities (Article 8) and things in action. “Goods” also includes the unborn young of animals and growing crops and other identified things attached to realty as described in the section on goods to be severed from realty (Section 554.2107).

As Nordstrom points out, this section is divided into two parts, the first affirmative, defining the scope and reach of Article 2, the second negative, excluding certain transactions. To come within the affirmative section, the articles (the “things”) must be movable, and the movability must occur at the time of identification to the contract. The applicability of the Code to the April contract is clear from and within its four corners. The “things” sold are all items of tangible property, normally in the flow of commerce, portable at the time of the contract. They are not the less “goods” within the definition of the act because service may play a role in their ultimate use. The Code contains no such exception. “Services,” continues Nordstrom, id. at 47, “always play an important role in the use of goods, whether it is the service of transforming the raw materials into some usable product or the service of distributing the usable product to a point where it can easily be obtained by the consumer. The § 554.2105(1) definition should not be used to deny Code application simply because an added service is required to inject or apply the product.” In short, the fact that the contract “involved substantial amounts of labor” does not remove it from inclusion under the Code on the ground, as the special Master found that “The Code was [not] meant to cover * * * non-divisible mixed contracts of this type.”

Thus Aluminum Company of America v. Electro Flo Corp., 451 F.2d 1115 (10th Cir. 1971) involved an “electrified floor and Whirly Dodge vehicles operating on it” for use by carnival companies. Defendant Electro Flo was incorporated for the purpose of making commercial use of this idea. Plaintiff (Alcoa) undertook to design and produce the flooring materials. In an action on the contract, with Electro Flo arguing breach of implied warranty, Alcoa defended in part upon the theory that it was a contract for services rather than sale. The Court, however, found that “the transaction between Alcoa and Electro Flo, while it involved some engineering and design aspects, was in essence a sale of goods.” 451 F.2d 1118. It held, in part:

While it is true that Alcoa utilized design engineers on the project, these services were for the purpose of enabling Alcoa to fulfill Electro Flo’s requirements for goods. Electro Flo did not order or contract for engineering. Alcoa’s full charge was for materials furnished; its offer was by price quotation for the products only, and it did not bill for engineering services or seek compensation therefor save as the cost of such services entered into the price for the materials delivered.

Id.

We find a similar holding in Port City Construction Co., v. Henderson, 48 Ala.App. 639, 266 So.2d 896 (1972) involving a contract for the sale of concrete and “all labor to pour and finish,” both at a stated price. On the interpretation of the contract the court held as follows:

In the beginning of our discussion, we first observe that the contract or agreement upon which suit was brought is in essence a contract for sale, though including an agreement for work and labor, as defined by * * * Section 2-106 of the Code. Thus it is subject to be considered and to be controlled by the applicable provisions of the Uniform Commercial Code as adopted in this State.

To the same effect is Warner Motors, Inc. v. Chrysler Motors Corp., 5 UCC Rep. 365 (U.S.D.Ct.E.D.Pa.1968), litigation involving breach of a dealer’s agreement. The court held in part as follows:

It seems to me that there can hardly be any question that the dealer agreement is a “contract for sale” within the meaning of § 2-725 of the Uniform Commercial Code. The business of the Chrysler Corporations was selling the automobiles, which Chrysler manufactured and the declared “purpose of the relationship established” by the agreement was “to provide a means for the sale and service of DeSoto and Plymouth passenger cars, parts and accessories.” Certainly, the fact that the agreement contained terms providing for services, franchising and the like in no way affects its character' as determined by its overall object, namely selling automobiles. See Weilersbacher v. Pittsburgh Brewing Co., 421 Pa. 118 [3 UCC Rep. 309] (1966), in which case the Supreme Court of Pennsylvania held article 2 of the code to be applicable to a similar' agreement between a brewery and a beer distributing agency.

In contrast to the language of the April contract before us, in which “the following used equipment” was purchased, we note the contractual terminology employed in Computer Servicenters, Inc. v. Beacon Mfg. Co., 328 F.Supp. 653 (D.S.C.1970), aff’d, 443 F.2d 906 (4th Cir. 1971), wherein the court, in holding that the contract there before it was one for service, rather than for the sale of goods, held as follows:

Article 2 of the Commercial Code deals with “transactions in goods.” [§ 2-102], “Goods” as used in the section means “all things (including specially manufactured goods) which are movable at the time of identification to the contract for sale other than the money in which the price is to be paid, investment securities and things in action.” [§ 2-105(1)]. That definition is indeed broad, however, it must be noted that the article deals with, and the definition of goods is cast in terms of, the contract for sale. “Sale” “consists in the passing of title from the seller to the buyer for a price.” [§2-106(1)].
The fact of the matter here is that the alleged contract was simply not for the sale of goods as contended by the plaintiff. Rather it was that certain services be provided the defendant by the plaintiff. The written proposal states that it is an agreement “for performance of data processing services.” The proposal indicated that there would be a separate charge for supplies unless the defendant provided them. The payment contemplated was for the analysis, collection, storage, and reporting of certain data supplied the plaintiff by the defendant. It was not for the sale of goods, and to claim to the contrary strains the imagination.

328 F.Supp. at 654-655.

The parties have cited to us as authority for categorization as sales or service contracts certain “blood” cases and cosmetics cases. Although such cases utilize analyses similar to that here employed we will not discuss them further in view of their widely variant factual and policy consideration.

Finally, on this phase of the case, we find a dearth of authority going to a point relied upon by the Special Master, namely, that the Code was not meant to cover “non-divisible mixed [goods and services] contracts of this type.” Rather, the cases presenting mixed contracts of this type are legion. The test for inclusion or exclusion is not whether they are mixed, but, granting that they are mixed, whether their predominant factor, their thrust, their purpose, reasonably stated, is the rendition of service, with goods incidentally involved (e. g., contract with artist for painting) or is a transaction of sale, with labor incidentally involved (e. g., installation of a water heater in a bathroom). The contract before us, construed in accordance with the applicable standards of the Code, is not excluded therefrom because it is “mixed,” and, moreover, is clearly for the replacement of equipment destroyed by fire, i. e. “goods” as defined by the Code.

Ill

The buyers argue that there was an anticipatory repudiation of the April contract subsequent to the seller’s death. The Special Master did not rule directly on the issue thus presented, although it is clear that he rejected it since he found that the buyers themselves had repudiated the contract by taking over the repair and installation of the goods subsequent to the seller’s death, and by refusing further delivery or service (apparently by the Administrators) under the contract.

The situation at the time of the seller’s death warrants close examination from the standpoint of business feasibility. The seller had neither business associates nor partners. It was a one-man operation. Upon hearing of Simek’s illness, which ultimately resulted in his death, Donald Cox went immediately to see him. Most of the goods called for in the April contract had not been delivered ; others had not been installed, and the pinspotting machines were seriously defective. The reason for his trip, despite the illness, was that “we didn’t have any business yet or no way to get it opened.” He was too late. The seller died on Friday, September 6. On Saturday, September 7, Blackie suggested that they go to a Simek warehouse at Mead for equipment, but the trip was fruitless. There were only a few mismatched lockers and some hardware. Calls were made to Simek’s suppliers in an unsuccessful effort to locate the missing equipment. On Monday, September 8 they went to Ashland to talk with the seller’s sister, Mrs. Bonebrake. “We were * * * in a real bind,” they told her. “[T]he job was just incomplete. We didn’t know which way to turn.” She (and we do not speak critically) was of no help whatever. She said she knew nothing of her brother’s business, but she did take them to a building where they obtained a number of balls and shoes. On Wednesday, September 11 they called on her again “because we obviously weren’t getting anywhere.” Mrs. Bonebrake remembers only one visit, but whether or not she spoke with them once or twice is not significant. The record is clear that she was unable to help them or to suggest productive action at any time during their contacts. Up to this point the buyers were clearly trying to act within the contract. Their conferences with the seller’s sister and with Blackie are capable of no other construction. But following the last visit, upon their return to Missouri Valley, they “got [their] heads together that night as far as what we were going to do and the next day we acted.” The action taken was to proceed on their own, without further reference to Mrs. Bonebrake or Blackie, with their efforts to get their business into operation. The missing equipment was ordered from others.

The buyers assert that their action was justified because at this point they were confronted with a repudiation of their contract, anticipatory in that the time for performance was still open, but nonetheless a breach. We are of the opinion that the requirements of “anticipatory repudiation” under the Act were clearly present. The statutory requirement for anticipatory repudiation is not that performance be literally or utterly impossible. The Code was framed with the day to day requirements and customs of businessmen in mind, not the legalisms of counsel. The Code does not require the certainty of the physicist or the utter frustration of literal impossibility. What is required under the Code, to permit the aggrieved party to move for his own protection, is “action which reasonably indicates a rejection of the continuing obligation.” Viewed in the light of the situation confronting the buyers at the time, the fact that they could not find suitable goods in the seller’s warehouses, that there was no one to whom they could turn, the crucial time element involved if the enterprise were to qualify for league competition, and the deplorable state of the equipment furnished, there was, beyond doubt, a reasonable indication of a rejection of the continuing obligation (due to the circumstances involved, we note, rather than malevolence or ill will), and thus an anticipatory breach under the Code. We do not explore the situation after the arrival of the Administrators on September 17. These gentlemen, one a rural mail carrier, the other an insurance and real estate agent, were each without relevant experience and were equally in the dark as to what to do. “[W]e didn’t know what there was to do or anything; we had no idea,” testified the carrier. Should their offer to proceed under the contract be argued as a retraction of the anticipatory repudiation, it came too late. The buyers by this time had “materially changed” their positions.

The judgment of the District Court is reversed and the cause is remanded for further proceedings consistent herewith.

      . “The Special Master is not insensitive to the strong evidence that the pinspotters were seriously defective when they were accepted by the defendants. It may appear harsh that the defendants must now pay the full balance of the contract price for these goods, but the Court cannot rewrite the law.”

      . In a conclusion which neither party challenges, the Master found that the law of Iowa governs the resolution of this dispute. The Iowa Uniform Commercial Code is found in the Code of Iowa §§ 554.1101-554.-10105 (1971). For convenience we will refer to its provisions simply by section number, e. g., § 554.2607 (3) (a). The number following the decimal point in the Code of Iowa corresponds (less the hyphen) to the number used by the American Law Institute; in the above example, § 2-607 (3) (a). Any reference to a hyphenated section number or to a Comment is to the Uniform Commercial Code (1962 version).

      . Gross v. Fidelity & Deposit Co., 302 F.2d 338 (8th Cir. 1962).

      . These latter items were jmomised under the first contract. Blackie testified that at the time he quit he could have completed his work on the first contract in eighty man hours, or five days, using two men.

      . Mrs. Bonebrake testified that she never received the letter. The Master found, however, “no reason to believe that [it] was not mailed.”

      . J. White & R. Summers, Handbook of the Law Under the Uniform Commercial Code l-L-15 (1972) [hereinafter cited as White & Summers].

      . This option is clearly open to the buyer under the Code. §§ 554.2607(2), 554.2601 and Comments thereto. See also Dailey v. Holiday Distrib. Corp., 260 Iowa 859, 872, 151 N.W.2d 477, 486 (1967) (pre-Code).

      . If the above quoted passages of the Master’s opinion are not conclusive on the point, we note, as well, the following:
      [T]he defendants had at least two options when the defective pinspotters were tendered :
      1) they could justifiably reject the goods and demand either their money back or proper goods, or,
      2) they could accept the goods and notify the plaintiff of the particular defects, thereby giving the plaintiff time to cure the defects and preserving their rights, [emphasis supplied.]

      . § 554.2508 provides:

        Cure by seller of improper tender or delivery — rep lacement.

      1. Where any tender or delivery by the seller is rejected because nonconforming and the time for performance has not yet expired, the seller may seasonably notify the buyer of his intention to cure and may then within the contract time make a conforming delivery.
      2. Where the buyer rejects a nonconforming tender which the seller had reasonable grounds to believe would be acceptable with or without money allowance the seller may if he seasonably notifies the buyer have a further reasonable time to substitute a conforming tender.

      . White & Summers 344.

      . R. Nordstrom, Handbook of the Law of gales 40, 44 (1970) [hereinafter cited as Nordstrom].

      . Seller argues that this was a “construction contract” such as that held to be outside Code coverage in Vernali v. Centrella, 28 Conn.Sup. 476, 266 A.2d 200 (Super.Ct. 1970) (contract for the construction of a house according to specifications). The analogy urged is that it involved “the attaching of moveable objects so that at their [sic] completion of the contract they are immoveable.” We reject this contention for two reasons. First, the time for testing whether a thing is movable for purposes of § 554.2105 is “the time of identification to the contract,” which here occurred before the installation of the equipment. § 554.2501(1) (b). Second (and alternately) it is not clear that, as the seller argues “the lanes are built into the building.” They were not constructed on the site, but, Blackie testified, came in three prefabricated sections:
      [Y]ou move your lane in, stand them on edge; and they’re in three pieces in most cases.
      You splice them together * * *. Then you lay these lanes down, line them up, level them, as you screw them to the wood foundation * * *.
      The “wood foundation” is not part of the building but was constructed on the “concrete floor that’s there when we move in the building.” In addition to this evidence we note this was a contract for “used” lane beds; their previous installation in some other bowling alley had not rendered them immovable.

      . Perlmutter v. Beth David Hospital, 308 N.Y. 100, 123 N.E.2d 792 (1954); Epstein v. Giannattasio, 25 Conn.Sup. 110, 197 A.2d 342 (C.P.1963).

      . See Comment, Sale of Goods in Service-Predominated Transactions, 37 Fordam L. Rev. 115 (1968) ; Comment, Blood Transfusions and the Warranty Provisions of the Uniform Commercial Code, 9 B.C.Ind. & Com.L.Rev. 943 (1968) ; Nordstrom 46-47, and cases therein cited.

      . National Historic Shrines Foundation, Inc. v. Dali, 4 UCC Rep. 71 (N.Y.Sup.Ct.1967).

      . Worrell v. Barnes, 87 Nev. 204, 484 P.2d 573 (1971) (“ * * * we deem this case tp involve ‘goods’ within the purview of the Uniform Commercial Code.”)

      . § 554.2610.

      . § 2-610, Comment 2.

      . § 554.2611.

      . § 554.2611(1).


source: Caselaw Access Project

author: PER CURIAM:

license: Public Domain

text:
    UNITED STATES of America, Appellee, v. Ronald Lee LAWRENCE, Appellant.
    No. 73-2024.
    United States Court of Appeals, Fourth Circuit.
    Submitted March 22, 1974.
    Decided July 9, 1974.
    Brian P. Gettings, U. S. Atty., and James A. Oast, Jr., Asst. U. S. Atty., on brief for appellee.
    Michael S. Weisberg, Norfolk, Va., [court-appointed], on brief for appellant.
    Before HAYNSWORTH, Chief Judge, and FIELD and WIDENER, Circuit Judges.
   PER CURIAM:

Ronald Lee Lawrence was convicted by a jury of bank robbery in violation of 18 U.S.C. § 2113(a) and (d). He was sentenced to imprisonment for twenty-five years. In this appeal Lawrence argues that the photographic identification procedures employed by the government were unduly suggestive and thus rendered all subsequent in-court identifications inadmissible. Lawrence also argues that admission of testimony regarding the getaway car and the discovery of his fingerprints on it constituted reversible error. We find no merit in either argument and affirm the conviction.

A claim that an in-court identification was fatally tainted by a previous photographic identification requires a showing that “the photographic identification was so impermissibly suggestive as to give rise to a very substantial likelihood of irreparable misidentification.” Simmons v. United States, 390 U.S. 377, 384, 88 S.Ct. 967, 971, 19 L.Ed.2d 1247 (1968). We do not think that the procedure used to identify Lawrence from a photographic spread was in any way impermissible. A series of six photographs, all of the same race as Lawrence, were shown to each of the eyewitnesses. We have examined the photographs and do not find that any of them contain the element of suggestiveness argued by Lawrence. United States v. Cunningham, 423 F.2d 1269 (4 Cir. 1970).

Lawrence next argues that all evidence concerning the getaway car and his fingerprints on it was irrelevant and immaterial. We disagree. A witness for the government testified that he noticed an unattended car bearing temporary Virginia license plates in a driveway near the bank at the time of the robbery. The witness testified that he saw a man get into the car and drive it a short distance where he stopped and waited for two men. The car was later stopped and, although Lawrence was not present in the car, his fingerprints and a palm print were discovered on the outside of the car door. Testimony concerning Lawrence’s connection with the car was sufficient to support an inference by the jury that he had been in the getaway car and was admissible to show the intent and physical capacity to cornmit the crime charged in the indictment. See Sanders v. United States, 238 F.2d 145 (10 Cir. 1956).

Accordingly, we dispense with oral argument and affirm the conviction.

Affirmed.


author: WIDENER, Circuit Judge:

text:
    Ronald Lee TUCKER, Appellee, v. Dewey DUNCAN and Tom Rasmussen, Appellants.
    No. 73-1689.
    United States Court of Appeals, Fourth Circuit.
    Argued Jan. 9, 1974.
    Decided July 9, 1974.

      Frank B. Aycock, III, Charlotte, N. C., for appellants.
    George S. Daly, Jr., Charlotte, N. C., for appellee.
    Before HAYNSWORTH, Chief Judge, and WINTER and WIDENER, Circuit Judges.
   WIDENER, Circuit Judge:

Ronald Lee Tucker brought an action under 42 U.S.C. § 1983 against two Belmont, North Carolina police officers, Dewey Duncan and Tom Rasmussen, seeking damages for unlawful arrest, use of unlawful force, and malicious prosecution. A jury found in his behalf on all issues and awarded damages against each of the defendants accordingly. We find no reversible error in the trial as to the issues of unlawful arrest and use of unlawful force. Since it appears, however, that Tucker’s prosecution for public drunkenness and resisting arrest was terminated by efforts brought about by Tucker or his attorney, with his consent, we reverse as to the issue of malicious prosecution.

The facts stated most favorably for plaintiff show that on December 13, 1970, at approximately 4:00 a. m., the plaintiff, accompanied by his wife, walked across his yard with the intention of obtaining pipe tobacco from his automobile. Before he reached the street, however, officers Duncan and Rasmussen drove up in a police car and announced, although neither had a warrant, that they were placing Tucker under arrest for public drunkenness. When both Rasmussen and Duncan seized his arms, Tucker pulled away. Rasmussen then threw Tucker, still in his front yard, face down in the grass, twisted his arm behind him and sat astride his back. Tucker’s wife testified that, at that point, Rasmussen struck Tucker twice with a blackjack, thereby opening a cut in his forehead which later required eight stitches to close. Duncan and Rasmussen then handcuffed Tucker and placed him face down in the street.

Tucker was subsequently charged with public drunkenness and resisting arrest. During trial, Tucker testified that he went three times to court on matters concerning these charges but was never tried. On the last of these occasions, the charges were dropped shortly after his attorney spoke with the prosecutor in a back room. He testified that his attorney obtained a nol-pros of the charges.

The testimony of Duncan and Rasmussen differs substantially from that of the plaintiff. According to their account of the incident, Duncan and Rasmussen approached Tucker’s residence after receiving a dispatch call to investígate the vicinity. They claim that as they approached in their patrol car Tucker entered the street, and that he was both intoxicated and profane. The scuffle between Tucker and Rasmussen occurred when the officer, seeing the tip of Tucker’s pipe protruding from his pocket, believed it to be the butt of a gun. The jury, nevertheless, chose to believe Tucker’s account of the incident, and found both defendants guilty on the issues of unlawful arrest, use of unlawful force, and malicious prosecution.

In this appeal, the defendants concede that the evidence was sufficient to go to the jury on the issue of unlawful arrest as to both defendants, and on the issue of unlawful force as to Rasmussen only, but not as to Duncan. Duncan’s own testimony, however, indicates that he seized Tucker’s arm when Rasmussen threw him to the ground, and that he later handcuffed Tucker, thus indicating at least some part in the affray. Conseqeuently, we find there was evidence from which a jury might have believed that Duncan had used unlawful force. Lavender v. Kurn, 327 U.S. 645, 653, 66 S.Ct. 740, 90 L.Ed. 916 (1946); Chicago, St. P., M & O Ry. Co. v. Kulp, 102 F.2d 352, 356 (8th Cir.), cert. denied, 307 U.S. 636, 59 S.Ct. 1032, 83 L.Ed. 518 (1939).

Since the record also indicates, however, without contradiction, that the charges against Tucker were dismissed by way of nol-pros obtained by his attorney, the issue of malicious prosecution should not have been given to the jury to decide. As the North Carolina Supreme Court had occasion to note in Welch v. Cheek, 125 N.C. 353, 34 S.E. 531, 532 (1899):

“When, however, the termination has been induced and brought about by the defendant, he cannot maintain an action for damages. ‘Where a nol. pros, is entered by the procurement of the party prosecuted, or by his consent or by compromise, such party cannot have an action for malicious prosecution.’ Langford v. Railroad Co., 144 Mass. 431, 11 N.E. 697; Marcus v. Bernstein, 117 N.C. 31, 23 S.E. 38.”

See also Alexander v. Lindsey, 230 N.C. 663, 55 S.E.2d 470, 476 (1949).

Other assignments of error have been considered and found without merit. Judgment will be entered in accordance with this opinion.

Affirmed in part; reversed in part; and remanded.

      . 42 U.S.C. § 1983 is a right of action for the deprivation of federal constitutional rights. It is not a federal remedy for ordinary state tort claims, for it can vindicate only federal constitutional rights determined under federal substantive law. See Street v. Surdyka, 492 F.2d 368 (4th Cir. 1974). Within those confines, however, it is not inappropriate to borrow from state law a developed body of rules governing actionable wrongs and a procedural bar to the assertion of a federal claim of relative triviality.


author: PER CURIAM.

text:
    UNITED STATES of America, Appellee, v. Bruce R. NELSON, Appellant.
    No. 74-1186.
    United States Court of Appeals, Eighth Circuit.
    Submitted June 12, 1974.
    Decided July 11, 1974.

      John P. Clifford, Robins, Meshbesher, Singer & Spence, Minneapolis, Minn., for appellant.
    Daniel Scott, Asst. U. S. Atty., Minneapolis, Minn., for appellee.
    Before GIBSON, BRIGHT, and WEBSTER, Circuit Judges.
   PER CURIAM.

Bruce R. Nelson appeals his conviction of possession of heroin, a misdemeanor under 21 U.S.C. § 844(a). He contends that the conviction cannot stand since the Government failed to prove the presence of a sufficient quantity of heroin to produce a narcotic effect. The trial court rejected this contention and instructed the jury that any measurable amount of 'heroin would sustain the conviction. We affirm.

Nelson possessed two plastic packets each containing brown powder. Chemical analysis established these packets qualitatively contained heroin laced with procaine and lactose, the latter two being cutting powders. This analysis, however, did not establish the quantity of the heroin taken from Nelson or whether that heroin would produce a narcotic effect.

Under federal law a conviction will be upheld where any measurable amount of a prohibited narcotic drug is found. See, e. g., United States v. Sudduth, 458 F.2d 1222 (10th Cir.), cert. denied, 409 U.S. 871, 93 S.Ct. 200, 34 L.Ed.2d 122 (1972); United States v. Curbelo, 423 F.2d 1204 (5th Cir. 1970); United States v. Castro, 418 F.2d 230 (2d Cir. 1969), cert. denied, 397 U.S. 1052, 90 S.Ct. 1391, 25 L.Ed.2d 667 (1970); Jordan v. United States, 416 F.2d 338 (9th Cir. 1969), cert. denied, 397 U.S. 920, 90 S.Ct. 930, 25 L.Ed.2d 101 (1970). Though these cases arose under earlier versions of narcotics laws, nonetheless we can read no quantitative requirement into the plain words of § 844(a) which forbids “any person [to] knowingly or intentionally * * * possess a controlled substance * *

Additionally, the term “controlled substance” as used in § 844(a), is defined in 21 U.S.C. § 802(6), to mean “a drug or other substance, or immediate precursor, included in schedule I * * Heroin is found in Schedule 1(b) (10) as set out in 21 U.S.C. § 812, and is there listed as an opium derivative. Heroin falls into the definitional category of a “narcotic drug” which is defined in 21 U.S.C. § 802(16) as, inter alia, an opium derivative, without the use of any language specifying that the drug possesses a narcotic effect.

Thus, we are of the view that there was sufficient evidence to support Nelson’s conviction under § 844(a) upon a showing of a qualitative analysis identifying the presence of heroin in his possession at the time of his arrest.

Accordingly, we affirm.

      . Subsection (a) of 21 U.S.C. § 844 provides:
      (a) It shall be unlawful for any person knowingly or intentionally to possess a controlled substance unless such substance was obtained directly, or pursuant to a valid prescription or order, from a practitioner, while acting in the course of his professional practice, or except as otherwise authorized by this subchapter or subchapter II of this chapter. Any person who violates this subsection shall be sentenced to a term of imprisonment of not more than one year, a fine of not more than $5,000, or both, except that if he commits such offense after a prior conviction or convictions under this subsection have become final, he shall be sentenced to a term of imprisonment of not more than 2 years, a fine of not more than $10,000, or both.


text:
    SOUTHERN LAND & DEVELOPMENT COMPANY, INC., Plaintiff-Appellee, v. Louise C. SILVERS, Defendant-Appellant.
    No. 74-1123.
    United States Court of Appeals, Sixth Circuit.
    Argued June 6, 1974.
    Decided July 11, 1974.
    Harry Weill, Chattanooga, Tenn., for defendant-appellant.
    Ford P. Mitchell, Chattanooga, Tenn., for plaintiff-appellee.
    Before PECK, McCREE and ENGEL, Circuit Judges.
   PER CURIAM.

This is an appeal from a judgment in an action on a promissory note to recover against appellant, Louise C. Silvers, and her husband. Both had agreed in writing to “guarantee” payment of the note for Cherokee Motor Lines, Inc., a corporation in which appellant’s husband was a principal. The parties stipulated to the liability of appellant’s husband and left for determination by the district court only the question whether Louise Silvers was liable as a guarantor of the note. She contended that she was not liable because of 16 Ga. Code Ann. 53-503, which provides:

Wife feme sole as to her separate estate; binding separate estate. — The wife is a feme sole as to her separate estate, unless controlled by the settlement. Every restriction upon her power in it must be complied with; but while the wife may contract, she may not bind her separate estate by any contract of suretyship nor by any assumption of the debts of her husband, and any sale of her separate estate, made to a creditor of her husband in extinguishment of his debts, shall be absolutely void.

The parties stipulated the facts relevant to this issue as follows:

The parties stipulate that Louise C. Silvers, wife of Malcolm T. Silvers, was not a shareholder, officer,- or director of Cherokee Motor Lines, Inc.; but that she was an employee of Cherokee Motor Lines from October, 1967, until the latter part of January, 1968, that she received a salary of $100.00 per week during this time, and that her duties consisted of assisting in the bookkeeping and paying of bills.

The note provided and the parties agree that Georgia law was applicable. Under that law a contract of guaranty is distinguished from a contract of suretyship by the existence of a sufficient consideration flowing to the guarantor. See 28A Ga. Code Ann. 103-101. And it is settled law in Georgia that the mere recitation “for value received” in the instrument is not controlling. The trial judge correctly recognized that Wolkin v. National Acceptance Co., 222 Ga. 487, 150 S.E.2d 831 (1966), was the leading decision on the issue of appellant’s liability. He determined :

. . . [T]he extension of credit to her employer, Cherokee, was a benefit to Mrs. Silvers. It is reasonable to infer that this credit assisted Cherokee in continuing in business — an obvious condition of Mrs. Silvers’ continued employment. Thus there existed a sufficient new, separate and independent consideration flowing to Mrs. Silvers to comply with the rule laid down in the Wolkin case.

We reverse because we determine that this was not a correct application of Georgia law. Wolkin, supra, 150 S.E.2d at 832-833, held that “where . . . there is undisputed evidence that no new, separate and independent consideration flowed to the party who signed a contract agreeing to be liable for the debt of another, the contract is one of suretyship and not guaranty and cannot be enforced against a married woman under Code § 53-503.” (emphasis added). See also Fruehauf Corp. v. McIntire, 408 F.2d 910 (5th Cir. 1969) (applying Georgia law and following Wolkin). The district court’s inference that appellant’s continuing employment was a consequence of the loan to the corporation does not satisfy this requirement. Her employment was neither new, nor was it separate and independent of the consideration that passed to the principal debtor, Cherokee. Instead, any incidental benefit received by appellant was wholly derived from and dependent upon the money received by Cherokee in exchange for the note.

We believe the Tennessee courts, if presented with this issue, applying Georgia law, would arrive at this result, and, since this is a diversity case, we must decide it as they would.

The judgment of the district court is reversed and the case remanded with instructions to enter judgment for appellant.


author: THORNBERRY, Circuit Judge:

text:
    Mary L. BROUSSARD et al., Plaintiff-Appellant, v. Caspar W. WEINBERGER, Secretary of Health, Education and Welfare, Defendant-Appellee.
    No. 74-1704
    Summary Calendar.

    United States Court of Appeals, Fifth Circuit.
    Aug. 28, 1974.
    John A. Woodside, Robert R. Truitt, Jr., Midland, Tex., for plaintiff-appellant.
    William S. Sessions, U. S. Atty., C. J. Calnan, Asst. U. S. Atty., San Antonio, Tex., Charles B. Rose, Asst. Reg. Atty., Dept, of HEW, Dallas, Tex., for defendant-appellee.

      Before BROWN, Chief Judge, and THORNBERRY and AINSWORTH, Circuit Judges.

       Rule 18, 5 Cir.; see Isbell Enterprises, Inc. v. Citizens, Casualty Company of New York et al., 5 Cir. 1970, 431 F.2d 409. Part I.

   THORNBERRY, Circuit Judge:

On December 16, 1962, Mary Sue Broussard gave birth to Douglas Fox. One week later she left him with his maternal grandparents in Midland, Texas, saying “[yjou’ll just take him and keep him if you want him, if you don’t, well, give him to a foster home.” The grandparents, Mary A. and Lawrence A. Broussard, kept the child, initially hoping that his mother would reclaim him. That hope was never fulfilled, so Douglas remained with his grandparents. Mr. Broussard died of cancer on November 10, 1968. Mrs. Broussard then filed an application for Social Security benefits for Douglas and herself. The Secretary of Health, Education and Welfare denied her application. Having exhausted her administrative remedies, Mrs. Broussard then sued in the district court under Section 205(g) of the Social Security Act, 42 U.S.C. § 405(g), to review the Secretary’s final decision, but that court denied her claim. We find the claim meritorious, and reverse.

The Social Security Act entitles every “child” of an individual who dies fully or currently insured to child’s insurance benefits. It also provides that the decedent’s widow shall receive a mother’s insurance benefit. The sole barrier to relief in this instance is the Secretary’s determination that Douglas was not Mr. Broussard’s child within the meaning of the Act. The Secretary recognized that a “child” could be either adopted or natural, but held that, under Texas law, no adoption had taken place. We think that the Secretary applied too strict a legal test in reaching his conclusion.

Cavanaugh v. Davis, 149 Tex. 573, 235 S.W.2d 972 (1951), provides the starting point for our analysis. There, the Texas Supreme Court indicated that a party seeking the benefit of the adoption by estoppel doctrine must show by clear and convincing evidence an agreement or contract to adopt. The appellant concedes that no express oral or written agreement existed. Thus appellant can prevail only if the conduct of the individuals concerned clearly, unequivocally, and convincingly demonstrates the requisite agreement. See Hayes v. Secretary of Health, Educ. & Welfare, 413 F.2d 997 (5th Cir. 1969); Minefield v. Railroad Retirement Bd., 217 F.2d 786 (5th Cir. 1954). Yet, as we noted in Smith v. Secretary of Health, Educ. & Welfare, 431 F.2d 1241 (5th Cir. 1970), it is not necessary for the appellant to show a formal agreement, or use of the word “adoption” in the formal sense at the pertinent times. 431 F.2d at 1245. That requirement would conflict with the remedial purposes of the Social Security Act, and the requirement for liberal construction in favor of coverage if such a construction is reasonable. Combs v. Gardner, 382 F.2d 949 (6th Cir. 1967). We think that appellant has made the requisite showing in this case.

Douglas’s natural mother abandoned him one week after his birth, and repeatedly stated to appellant that she and Mr. Broussard could have the boy all the time. His mother claimed that the grandparents had spoiled the boy to the point that she did not want him, and would not take care of him. For their part, the Broussards continuously provided for Douglas with no assistance from his natural mother. They carried hospitalization and life insurance for him. Mrs. Broussard has provided for him in her will. Mr. Broussard, shortly before his death, indicated his intention to put Douglas through school, and provide a home for him. The evidence clearly shows that appellant and her deceased husband had every intention of providing a permanent home for the child. Even though they had not instituted formal adoption proceedings, their conduct manifested an intent to keep and care for Douglas as their own.

We find that the evidence clearly shows conduct of the parties involved sufficient to bring this case within the rationale of Smith v. Secretary of Health, Educ. & Welfare, 431 F.2d 1241 (5th Cir. 1970). Therefore we reverse and remand to the district court with instructions to enter judgment awarding child benefits and wife’s benefits to the appellant.

      . 42 U.S.C. § 402(d)(1).

      . 42 U.S.C. § 402(g)(1).

      . 42 U.S.C. § 416(h)(2)(A) provides: “In determining whether an applicant is the child ... of a fully or currently insured individual for purposes of this subchapter, the Secretary shall apply such law as would be applied in determining the devolution of intestate personal property by the courts of the State in which such insured individual is domiciled at the time such applicant files application . . . .”


author: AINSWORTH, Circuit Judge:

text:
    Norlinda D. PHILBECK, Plaintiff-Appellee, v. TIMMERS CHEVROLET, INC. and General Motors Acceptance Corporation, Defendants-Appellants.
    No. 73-3586.
    United States Court of Appeals, Fifth Circuit.
    Aug. 15, 1974.
    Rehearing and Rehearing En Banc Denied Oct. 3,1974.

      Joseph W. Crooks, Atlanta, Ga., for Timmers Chevrolet, Inc.
    A. Mims Wilkinson, Jr., R. Byron Attridge, G. Lemuel Hewes, Atlanta, Ga., for General Motors Acceptance Corp.
    John Harris Paer, Fred L. Cavalli, Atlanta, Ga., for plaintiff-appellee.
    W. Rhett Tanner, Andrew J. Britton, Atlanta, Ga., for National Consumer Finance Assn, and Georgia Consumer Finance Assn., amicus curiae.
    W. Stell Huie, Terrence Lee Croft, Lawrence L. Thompson, Atlanta, Ga., for Ga. Bankers’ Assn., amicus curiae.
    Steven Gottlieb, Atlanta, Ga., for Atlanta Legal Aid Society, Inc., amicus curiae.
    Before MOORE, AINSWORTH and RONEY, Circuit Judges.

       Hon. Leonard P. Moore, Senior Circuit Judge of the Second Circuit, sitting by designation.

   AINSWORTH, Circuit Judge:

This case presents a significant question concerning the applicability of disclosure provisions of the Truth in Lending Act to the term of optional credit life insurance sold in connection with a closed-end consumer credit transaction, when the term of the insurance coincides with the term of the credit obligation.

On December 31, 1971, Norlinda D. Philbeck executed a written contract with Timmers Chevrolet, Inc., to purchase an automobile for a cash price of $4,701.57, $2,850 of which was to be financed over a 36-month period. Subsequently, Philbeck’s contract with Timmers was purchased by and assigned to General Motors Acceptance Corporation.

The contract Philbeck signed consummating the credit sale is a standard GMAC form entitled “Instalment Sale Contract.” The face of the contract form provides for the ordinary disclosures, including unpaid balance (amount financed), finance charge, total of payments, deferred payment price, annual percentage rate, and payment schedule. Also on the face of the contract, listed under Item 4, “Other Charges,” are optional provisions for the customer to choose various types of insurance associated with the ownership and financing of an automobile. Item 4C is designated for listing the cost of creditor insurance. It is clearly indicated in capitalized, boldface type that coverage of the buyer by such creditor insurance is not required by the seller. Three types of creditor insurance are listed: “Life,” “Disability (Accident and Health),” and “Other (describe).” Separate spaces are provided for listing the cost of each type of creditor insurance. The type of creditor insurance desired is to be indicated by checking an appropriate box. Below these listings is a statement in capitalized, boldface type indicating the buyer’s desire to obtain the type of creditor insurance noted. Approval of the statement is affirmatively shown by the buyer’s separately dating and signing Item 4C of the contract.

The purpose of obtaining credit life insurance is to cover the buyer’s credit obligation during part or all of the term of the financing. The insurance is procured by and in the name of the seller or assignee of the contract.

Philbeck indicated to Timmers her desire to obtain the optional credit life insurance. On Philbeck’s contract, the box denoting her desire for the life insurance was checked; and, on the same line, the premium for the insurance was disclosed as $110.12. Philbeek’s approval was dated, and she separately signed Item 4C of the contract, thus affirmatively indicating her desire to obtain the credit life insurance.

Next to the line on the contract containing the designation and premium cost for credit life insurance, three asterisks direct the buyer’s attention to a block on the face of the contract, approximately two thirds of the way down the page, consisting of two and one-half lines of type, in which it is noted that the life insurance is issued in accordance with the “Notice of Proposed Creditor Insurance on Life of Buyer” contained on the reverse side of the contract. That section heading appears almost two thirds of the way down the reverse side of the contract in capitalized, boldface type. The section contains in paragraph (a) a description of the credit life insurance. In the following paragraph (b), there is notice that the term of the life insurance is coextensive with the term of the credit obligation. The provision reads in full:

(b) If the insurance becomes effective, the term thereof shall commence on the date of this contract and will (in absence of default on instalment payments) continue until the date on which the unpaid balance of the obligation hereunder is or becomes paid in full, unless the insurance is terminated earlier in accordance with the terms and conditions set forth in the policy or certificate issued by the aforesaid insurer.

Within a month of her purchase, Phil-beck became dissatisfied with the terms of the contract, particularly the annual percentage (interest) rate for financing the car and the credit life insurance premium. She contacted the Finance Manager of Timmers and requested cancellation of her optional credit life insurance policy. This was done, and the unused portion of the premium was refunded to her.

On June 5, 1972, Philbeck filed this action alleging violations of the Truth in Lending Act, 15 U.S.C. § 1601 et seq., and Regulation Z, 12 C.F.R. § 226 (1973), and Federal Reserve Board Interpretation § 226.402, 12 C.F.R. § 226.-402 (1973), promulgated thereunder, naming Timmers and GMAC as defendants. The district court granted summary judgment to Philbeck. We are concerned only with determining whether disclosure is required of the term of the optional credit life insurance chosen by Philbeck, where the term is the same as the credit obligation; and, if required, what the applicable disclosure standard is. The district court held that the term of the life insurance must be disclosed to the customer and that the appropriate standard of disclosure is the specific disclosure section of Regulation Z, § 226.8(a), 12 C.F.R. § 226.8(a), which, if applied here, requires disclosure of the term on the face of the credit document. Thus, the court below found that disclosure of the term of the optional credit life insurance only on the reverse side of the Philbeck contract constituted noncompliance. We reverse.

It is the declared congressional purpose of the Truth in Lending Act to assure consumers a meaningful disclosure of credit provisions, thus to enable the consumer to compare more readily various available credit terms and to avoid the uninformed use of credit. Truth in Lending Act § 102, 15 U.S.C. § 1601; see Mourning v. Family Publications Service, Inc., 411 U.S. 356, 364, 93 S.Ct. 1652, 1658, 36 L.Ed.2d 318 (1973). “To accomplish its desired objective, Congress determined to lay the structure of the Act broadly and to entrust its construction t.o an agency with the necessary experience and resources to monitor its operation.” Mourning v. Family Publications Service, Inc., supra, at 364, 93 S.Ct. at 1658. Section 105 of the Act, 15 U.S.C. § 1604, thus delegated to the Federal Reserve Board broad regulatory and rulemaking powers to effectuate the purposes of the Act. See Bone v. Hibernia Bank, 9 Cir., 1974, 493 F.2d 135, 138.

In deciding the question whether disclosure of the term of optional credit life insurance is required when the policy runs for the full term of the credit obligation, we deal primarily' with four sources of law and interpretation: the Truth in Lending Act itself; Regulation Z, which was promulgated by the Board pursuant to the broad powers granted it under section 105 of the Act; the Federal Reserve Board Interpretations of Regulation Z, 12 C.F.R. §§ 226.-201 et seq.; and the Federal Reserve Board staff opinions, which explain the provisions of the three foregoing authorities, usually in answer to a query regarding a particular factual situation. The three latter authorities, though not binding on the Court, are entitled to great weight, for they constitute part of the body of “informed experience and judgment of the agency to whom Congress delegated appropriate authority.” See Mourning v. Family Publications Service, Inc., supra, at 372, 93 S.Ct. at 1662; Skidmore v. Swift & Co., 323 U.S. 134, 140, 65 S.Ct. 161, 165, 89 L.Ed. 124 (1944); Allen M. Campbell Co. Gen. Con., Inc. v. Lloyd Wood Const. Co., 5 Cir., 1971, 446 F.2d 261, 265; Bone v. Hibernia Bank, supra, 493 F.2d at 140. We are not free to substitute our “own discretion for that of administrative officers who have kept within the bounds of their administrative powers.” American Telephone & Telegraph Co. v. United States, 299 U.S. 232, 236, 57 S.Ct. 170, 172, 81 L.Ed. 142 (1936); see Taylor v. R. H. Macy & Company, Inc., 9 Cir., 1973, 481 F.2d 178, 180, cert. denied, 414 U.S. 1068, 94 S.Ct. 577, 38 L.Ed.2d 473; Roy Bryant Cattle Co. v. United States, 5 Cir., 1972, 463 F.2d 418, 420. Furthermore, the construction which the Federal Reserve Board gives its own Regulation Z in its Interpretations and staff opinions is especially entitled to great deference “because of the important interpretive and enforcement powers granted this agency by Congress” in this highly technical field. Bone v. Hibernia Bank, supra, 493 F.2d at 139; see, e. g., Udall v. Tallman, 380 U.S. 1, 16-17, 85 S.Ct. 792, 801, 13 L.Ed.2d 616 (1965); Bowles v. Seminole Rock & Sand Co., 325 U.S. 410, 413-414, 65 S.Ct. 1215, 1217, 89 L.Ed. 1700 (1945); Allen M. Campbell Co. Gen. Con., Inc. v. Lloyd Wood Const. Co., supra, 446 F.2d at 265.

The specific language of the Truth in Lending Act, in section 106(b), 15 U.S.C. § 1605(b), refers, in the context of this case, only to “[c]harges or premiums for credit life” insurance and makes no specific mention of the term of the insurance. The section requires that such costs be included in the finance charge unless it is clearly disclosed in writing to the consumer that coverage of the debtor by insurance is not a factor in the approval of credit extension, and the buyer gives affirmative written indication that he or she desires insurance after its cost has been disclosed. The corresponding section in Regulation Z, § 226.4(a)(5), 12 C.F. R. § 226.4(a)(5), is similarly phrased and likewise makes no specific mention of the term of insurance.

Here, the cost of the life insurance premium was excluded from the finance charge in direct compliance with section 106(b) of the Act and section 226.-4(a)(5) of Regulation Z. Compliance by defendants with the provisions of those sections was complete, as the district court properly found, because issuance of the insurance was purely optional and not necessary to obtain the extension of credit and this was clearly and conspicuously disclosed on the face of the Philbeck contract. The court below, however, went on to find that Federal Reserve Board interpretation § 226.402 also requires disclosure on the face of the contract of the term of the life insurance when the policy runs for the full term of the credit obligation. See pages 975-976 and notes 7-8 supra. Interpretation § 226.402 provides in full:

§ 226.402 Term of insurance coverage
(a) Under § 226.4(a)(5) and (6) certain disclosures of insurance premium costs, if applicable, are required. The question arises as to whether such amounts of cost disclosed must include the cost of insurance for the full term of the transaction.
(b) Under § 226.4(h) the cost of insurance for the full period of insurance coverage which the creditor will require shall be disclosed if the cost of the insurance premium is required to be included in the finance charge. However, if the cost of insurance is not required to be included in the finance charge, the cost to be disclosed need only be the cost of premiums for the term of the initial policy or policies written in connection with the transaction, accompanied by a statement of the type of insurance and the term thereof. (Interprets and applied 15 U.S.C. 1605) [34 F.R. 7608, May 13, 1969]

The district court derived its result from the last sentence of the interpretation.

We disagree with the district court’s reading of the Interpretation. In our view, the Interpretation is inapplicable to the circumstances here and requires disclosure of the term of the insurance only in those instances in which the term of the insurance is less than the term of the credit obligation.

Subsection (a) of Interpretation § 226.402 specifies that the Interpretation is directed only to the question whether the disclosures of insurance premium costs required under section 226.4(a)(5) and (6) of Regulation Z “must include the cost of insurance for the full term of the transaction.” The manner in which the subject of the Interpretation is posed in subsection (a) reveals that the Board was concerned with disclosure of insurance costs in the situation in which the term of the insurance coverage is less than the term of the credit transaction; for in that situation the “insurance premium costs” and “the cost of insurance for the full term of the transaction” would not be the same. The consumer who desired insurance for the full term of the transaction would find it necessary either to renew the policy initially acquired or to take out an additional policy or policies, thus resulting in additional cost to the consumer. The Board was concerned with making the consumer aware of this possible additional cost. On the other hand, in the situation in which the life insurance is for the full term of the credit transaction, the total “insurance premium costs” that the consumer could possibly pay (that is, insurance for the full term of the credit obligation) and “the cost of insurance for the full term of the transaction” are one and the same. Disclosure to the consumer of the “insurance premium costs” is also disclosure to the consumer of the “cost of insurance for the full term of the transaction,” and there would have been no need for the Board to answer the question whether disclosure of “insurance premium costs . must include the cost of insurance for the full term of the transaction.” Thus, Interpretation § 226.402 is inapplicable to the situation involved here in which the life insurance is for the full term of the credit transaction.

The meaning we derive from the Interpretation is further supported by the use of the clause “the cost to be described need, only be the cost of the premiums for the term of the initial policy or policies written with the transaction, accompanied by a statement of the type of insurance and the term thereof.” (Emphasis added.) This language excludes the situation in which one insurance policy runs for the entire term of the credit transaction. Rather, the reference is to the transaction in which there is an “initial policy or policies” and there may be additional policies written thereafter.

The conclusion we reach from our study of Interpretation § 226.402 concerning disclosure of the term of insurance which is for the full term of the credit obligation is the same as that of a published Opinion Letter of an official of the Federal Reserve Board, issued in response to a query that made specific reference to the district court opinion in this case. The Opinion Letter states that Interpretation § 226.402 was issued only to answer the question of what cost should be disclosed where policies for less than the full term of the obligation were being offered. The Letter states in pertinent part, as follows :

In May of 1969, shortly before the Regulation was to become effective, the Board was confronted with the question of what “cost” should be disclosed under these provisions [§ 226.-4(a)(5) and (6) of Regulation Z] where policies for less than the full term of the obligation were being offered. .
. [W]hile the Board did indicate that the cost disclosure requirements could be met by disclosing the cost for less than the full term of the obligation, in such cases it believed that the consumer should be placed on notice that the quoted premium was for less than the full term of the obligation.
We believe it was not the Board’s intent to add a blanket requirement to either § 226.4(a)(5) or (6) by interpretation 226.402 that in all cases in which the insurance cost is disclosed the term of the obligation must also be shown. Specifically, in our opinion the term of the insurance coverage need not be shown where the coverage is for the full term of the obligation.

Excerpts from FRB Letter of October 26, 1973, No. 724, by Griffith L. Gar-wood, Adviser, 4 CCH Consumer Credit Guide |[ 31,035. This evaluation is compelled not only by reference to relevant authorities but also by the sense of the circumstances. The consumer who chooses credit life insurance is concerned with whether it will be necessary to take out a second insurance policy (or more) in order to complete the term of the credit obligation, since this would increase the consumer’s cost of insurance coverage for the full term of the credit obligation. By application of the disclosure requirements of Interpretation § 226.402 to the situation in which the term of the initial insurance policy is less than the full term of the credit transaction, the consumer is assured of being placed on notice that the premium shown for insurance is not the total cost of insurance coverage for the full term of the credit obligation. But where, as in this case, the term of the insurance is the same as the term of the credit obligation, the premium for insurance shown on the face of the contract is the maximum possible cost of insurance for the consumer and the coverage for that cost is the maximum possible. Thus, the consumer is fully informed and protected because he or she will not have to pay more than the insurance premium shown for insurance during the full term of the contract. To require that such disclosure be made on the face of a contract would not be meaningful disclosure such as would further the goals of the Truth in Lending Act.

Reversed.

      . The remainder of the purchase price was paid by a $1,351.57 trade-in on Philbeck’s old automobile and a $500 cash down payment.

      . Item 4 of Philbeck’s contract read:
      4. OTHER CHARGES
      !'A. Cost of Required Physical Damage Insurance
      BUYER MAY CHOOSE THE PERSON THROUGH WHICH THIS INSURANCE IS TO BE OBTAINED................................ ft -0- mai
      ^-B. Cost of Third Party Automobile Liability Insurance for buyer (Include this item if buyer has applied to an insurance company for the insurance and wishes the cost included.) This insurance is not required by seller.
      BUYER MAY CHOOSE THE PERSON THROUGH WHICH THIS INSURANCE IS TO BE OBTAINED ............................... ft -0- mr)
      C. Cost of Creditor Insurance
      COVERAGE OF THE BUYER BY ANY SUCH INSURANCE IS NOT REQUIRED BY SELLER.
      CHECK CREDITOR <•*- g] Life .......................... ft 110.12 (4fU
      INSURANCE DESIRED □ Disability (Accident and Health)'.... ft -0- (4n)
      □ Other (describe) ................ ft -0- Mr.)
      BUYER'S APPROVAL: I DESIRE TO OBTAIN THE CREDITOR INSURANCE CHECKED ABOVE FOR THE BUYER PROPOSED FOR INSURANCE.
      12-31-71 s'9aatui'e s/ Norlinda Philbeck
      (Date) (Buyer's Signature) (Co-Buyer's Signature)
      D. Official Fees .............................................. ft -0- (am
      E. Taxes Not Included in Cash Price ............................. ft -0- (4F)
      F. License and/or Registration Fees (Itemize) ...................... ft -O- (4F)
      G. Certificate of Title Fee ..................................... ft -0- (4ft)
      H. Other (Describe) ........................................... ft -0— (4H)

      . The block on the face of the contract provides:
      #t# According to terms and conditions set forth in policy or certificate of insurance issued by the insurer as checked below and in "Notice of Proposed Creditor Insurance on Life of Buyer" contained on reverse of buyer's copy of contract.
      Buyer Proposed For Life Insurance: The person whose name appears on line A below (co-buyer, if any, on line B, when buyer is a corporation or partnership).

      . We note the following exchange between Timmers’ counsel and Philbeck at the deposition of Philbeck:
      Q. [by counsel for Timmers] In looking at this instrument designated Exhibit B to the complaint and what we will call the sales contract, did you execute this line here right under the insurance question?
      A. [by plaintiff] I signed that question.
      Q. Did you read it?
      A. I read it where it says “I desire to obtain the creditor insurance checked above.”
      Q. Did you look at the amount?
      A. I glanced at the hundred ten dollars and I said “That’s too much.” And they said, “That’s what it costs.”
      Q. And you signed it?
      A. Yes.
      Q. And you understood that would be insurance for the life of the payments, 36 months.
      A. I understood it would be life insurance for me.
      Q. For what purpose?
      A. That if I died, they’d pay for the car.
      Q. And this would be during the term of your payments, 36 months?
      A. Right. Except it would not extend beyond 36 months because there wouldn’t be any payments beyond that.

      . The “Notice of Proposed Creditor Insurance on Life of Buyer” states in full:
      NOTICE OF PROPOSED CREDITOR INSURANCE ON LIFE OF BUYER —If a charge for Creditor Insurance on the life of the buyer is included in 4C on the face of this contract,
      (a) The buyer acknowledges that said charge is Included therein pursuant to his authorization, hereby confirmed, that such Insurance be procured, by and in the name of the seller or of the assignee of this contract, from the insurer designated in said item 4C, against the contingency of the buyer's death occurring while the insurance is in force during the term thereof referred to in paragraph (b) below, such insurance to be for an amount equal to, and the proceeds thereof to be payable to and applied, by the seller or assignee in payment of, so much of the unpaid balance of the obligation hereunder as does not exceed the amount set forth in said item 4C as the maximum amount of insurance under this contract, provided, however, that in the event the buyer has prior hereto incurred instalment obligations under another contract or other contracts containing a charge for insurance authorized to be procured on his life from the same insurer as Is designated on the face hereof, the aggregate amount of insurance to the benefits of which the buyer may become entitled under such several contracts, Including this one, shall be limited to the amount designated on the face hereof as the maximum aggregate amount of insurance payable by the said insurer under such several contracts, notwithstanding that at the time of the buyer's death the aggregate of the unpaid balance of the obligation under each of such several contracts or the aggregate of the aforesaid maximum amount of insurance under each thereof, whichever is the lesser, exceeds the aforesaid maximum aggregate amount of insurance under such several contracts, all in accordance with the terms and conditions set forth in the policy or certificate of insurance issued by the aforesaid Insurer.

        (b) If the insurance becomes effective, the term thereof shall commence on the date of this contract and will (in absence of default on instalment payments) continue until the date on which the unpaid balance of the obligation hereunder is or becomes paid in full, unless the insurance is terminated earlier in accordance with the terms and conditions set forth in the policy or certificate issued by the aforesaid insurer.

      . In her complaint, Philbeck contended that Timmers and GMAC had violated the Act by failing to disclose several items required to be disclosed or by disclosing them in an improper manner in a “Retail Buyer’s Order” and the “Instalment Sale Contract” signed by her. Philbeck further alleged that Timmers willfully and knowingly failed to make these disclosures and that GMAC had knowledge of the facts alleged. Philbeck requested statutory damages from each defendant of $1,000 and $15,000 in punitive damages from Timmers, plus attorney’s fees, costs, and interest.

      . There are two sections of Regulation Z containing disclosure requirements relevant to our discussion. Section 226.6, 12 C.F.R. § 226.6, the general disclosure provision, states in pertinent part:
      § 226.6 General disclosure requirements.
      (a) Disclosures; general rule. The disclosures required to be given by this Part shall be made clearly, conspicuously, in meaningful sequence, in accordance with the further requirements of this section, and at the time and in the terminology prescribed in applicable sections. . . .
      The “specific” disclosure section, § 226.8, 12 C.F.R. § 226.8, provides that in certain instances, enumerated in succeeding subsections, the disclosure requirements stated in subsection (a) apply. Section 226.8(a), 12 C.F.R. § 226.8(a) reads :
      § 226.8 Credit other than open end — specific disclosures.
      (a) General rule. Any creditor when extending credit other than open end credit shall, in accordance with § 226.6 and to the extent applicable, make the disclosures required by this section with respect to any transaction consummated on or after July 1, 1969. Except as provided in paragraphs (g) and (h) of this section, such disclosures shall be made before the transaction is consummated. At the time disclosures are made, the creditor shall furnish the customer with a duplicate of the instrument or a statement by which the required disclosures are made and on which the creditor is identified. All of the disclosures shall be made together on either
      (1) The note or other instrument evidencing the obligation on the same side of the page and above or adjacent to the place for the customer’s signature; or
      (2) One side of a separate statement which identifies the transaction.

      . The findings of the court below were: (1) that the “Instalment Sale Contract” and not the “Retail Buyer’s Order” was the agreement to extend credit to which the disdosure requirements of the Act apply; (2) that the Instalment Sale Contract was in complete compliance with the Truth in Lending Act and Regulation Z but that the disclosure of the cost of the optional credit life insurance specifically did not comply with Federal Reserve Board Interpretation § 226.402; (3) that when the cost of optional credit life insurance is not included as part of the finance charge, Interpretation § 226.-402 requires that the term of the insurance be disclosed to the customer; (4) that the term of the insurance was disclosed in full on the reverse side of the Instalment Sale Contract; (5) that the appropriate standard for evaluating the adequacy of disclosure of the credit life insurance term was the specific disclosure provisions of Regulation Z, § 226.8(a), 12 C.F.R. § 226.8(a), which require disclosure on the document’s face; and that, therefore, disclosure on the reverse side constituted noncompliance; and (6) that GMAC was a “creditor” within the meaning of the Act and jointly liable with Timmers for any violation of the Act.
      Philbeck was awarded $1,000 in statutory damages and $2,520 in attorney’s fees by the court below.

      . Truth in Lending Act § 102, 15 U.S.C. § 1601, states:
      § 1601. Congressional findings and declaration of purpose
      The Congress finds that economic stabilization would be enhanced and the competition among the various financial institutions and other firms engaged in the extension of consumer credit would be strengthened by the informed use of credit. The informed use of credit results from an awareness of the cost thereof by consumers. It is tbe purpose of this sub-chapter to assure a meaningful disclosure of credit terms so that the consumer will be able to compare more readily the various credit terms available to him and avoid the uninformed use of credit.

      . Truth in Lending Act § 105, 15 U.S.C. § 1604, provides:
      § 1604. Rules and regulations
      The Board shall prescribe regulations to carry out the purposes of this subchapter. These regulations may contain such classifications, differentiations, or other provisions, and may provide for such adjustments and exceptions for any class of transactions, as in the judgment of the Board are necessary or proper to effectuate the purposes of this subchapter, to prevent circumvention or evasion thereof, or to facilitate compliance therewith.

      . See generally Allen M. Campbell Co. Gen. Con., Inc. v. Lloyd Wood Const. Co., supra, 446 F.2d at 265:
      [I]t is an axiom of judicial review that an administrative agency’s interpretation of its own regulations must be accorded the greatest deference. Udall v. Tallman, 1965, 380 U.S. 1, 16-17, 85 S.Ct. 792, 801, 13 L.Ed.2d 616, reh. denied, 380 U.S. 989, 85 S.Ct. 1325, 14 L.Ed.2d 283; Bowles v. Seminole Rock & Sand Co., 1945, 325 U.S. 410, 413-414, 65 S.Ct. 1215, 1217, 89 L.Ed. 1700, 1702. When, as here, that interpretation obviously incorporates quasi-technical administrative expertise and a familiarity with the situation acquired by long experience with the intricacies inherent in a comprehensive regulatory scheme, judges should be particularly reluctant to substitute their personal assessment of the meaning of a regulation for the considered judgment of the agency. If the agency interpretation is merely one of several reasonable alternatives, it must stand even though it may not appear as reasonable as some other. (Footnotes omitted.)

      . Section 106(b) is applicable to charges or premiums for accident and health insurance, as well as credit life insurance, when such insurance is written in connection with any consumer credit transaction. Section 106(b) provides:

        Life, accident, or health insurance premiums included in finance charge

      (b) Charges or premiums for credit life, accident, or health insurance written in connection with any consumer credit transaction shall be included in the finance charge unless
      (1) the coverage of the debtor by the insurance is not a factor in the approval by the creditor of the extension of credit, and this fact is clearly disclosed in writing to the person applying for or obtaining the extension of credit; and
      (2) in order to obtain the insurance in connection with the extension of credit, the person to whom the credit is extended must give specific affirmative written indication of his desire to do so after written disclosure to him of the cost thereof.
      Similarly, section 106(c), 15 U.S.C. § 1605 (c), permits charges or premiums for insurance against loss of or damage to property or against liability to be excluded from the finance charge when the borrower is entitled to choose the person through which the insurance is to be obtained and the cost of the insurance is disclosed to him. Section 106(c) reads:

        Property damage and liability insurance premiums included in finance charge

      (c) Charges or premiums for insurance, written in connection with any consumer credit transaction, against loss of or damage to property or against liability arising out of the ownership or use of property, shall be included in the finance charge unless a clear and specific statement in writing is furnished by the creditor of the person to whom the credit is extended, setting forth the cost of the insurance if obtained from or through the creditor, and stating that the person to whom the credit is extended may choose the person through whicli the insurance is to be obtained.
      In the only legislative history on this particular portion of the Act, Representative Sullivan noted that “[i]f this insurance is optional, however, [creditors] merely have to list the cost in dollars and cents.” 114 Cong.Rec. 1433 (1968).

      . Regulation Z, § 226.4(a)(5), 12 C.F.R. § 226.4(a)(5) provides for inclusion in the finance charge of:
      (5) Charges or premiums for credit life, accident, health, or loss of income insurance, written in connection with any credit transaction unless
      (i) The insurance coverage is not required by the creditor and this fact is clearly and conspicuously disclosed in writing to the customer; and
      (ii) Any customer desiring such insurance coverage gives specific dated and separately signed affirmative written indication of' such desire after receiving written disclosure to him of the cost of such insurance. (Footnote omitted.)

      . The district court said :
      Interpretation § 226.402 clearly requires that for the disclosure of the cost of insurance to be adequate it must be “accompanied by a statement of the type of insurance and the term thereof.” . . .
      . . . This disclosure must be located in compliance with the general requirements of 12 C.F.R. § 226.8.

      . The parties to this litigation do not dispute the authoritative nature of this Interpretation.

      . Section 226.4(a)(6), 12 C.F.R. § 226.-4(a) (6) is the section of Regulation Z which deals with inclusion in the finance charge of charges or premiums for insurance against loss of or damage to property or against liability, thus corresponding to sectioh 106(c) of the Act, see note 12 supra. Section 226.-4(a) (6) provides for inclusion in the finance charge of:
      (6) Charges or premiums for insurance, written in connection with any credit transaction, against loss of or damage to property or against liability arising out of the ownership or use of property, unless a clear, conspicuous, and specific statement in writing is furnished by the creditor to the customer setting forth the cost of the insurance if obtained from or through the creditor and stating that the customer may choose the person through which the insurance is to be obtained. (Footnotes omitted.)

      . In its first annual report to Congress on-Truth in Lending, the Board referred to correspondence with creditors and consumers as a “valuable tool” in informing the public of the law’s requirements. 1969 FRB Ann. Rep. 8-9. Further cognizance was taken of the important function of these letters, when it was noted:
      [T]he Board considers the present informal and flexible procedure, by which members of its staff provide opinions on regulatory provisions, an essential part of its operations. It is the Board’s view that the public is entitled to rely on a formal staff opinion unless and until it is altered by the Board after formal consideration.
      Excerpts from FRB Letter of March 1, 1971, No. 444, by Kenneth A. Kenyon, Deputy Secretary, 4 CCH Consumer Credit Guide ¶ 30,640.

        See also use of Federal Reserve Board Opinion Letters in Mourning v. Family Publications Service, Inc., supra, 411 U.S. at 381, 93 S.Ct. at 1666 (Douglas, J., dissenting in part), 411 U.S at 384, 386, 93 S.Ct. at 1668-1669 (Powell, J., dissenting).

      . The published text of the Opinion Letter reads:
      [¶ 31,035] Disclosure of Insurance Term
      This is [on] your letter of August 27, 1973, in which you requested the staff views on the meaning of interpretation 226.402 [¶ 3525.10] of Regulation Z. Specifically, in reference to Philbeck v. Timmers Chevrolet, Inc. (N.D.Ga.1973.) (COH Consumer Credit Guide ¶ 98,978), you asked whether it was the Board’s intent by interpretation 226.402 to require that the term of credit life insurance be shown in connection with the disclosures under § 226.4(a)(5) [¶ 3518] when that insurance is written for the full term of the obligation. The staff believes that it is important to respond to your question in view of the possible ambiguity of the language in the interpretation, as well as the questions raised by the PMlbeck decision regarding the adequacy of the disclosures presently used by thousands of creditors throughout the nation.
      Section 106(b) [¶ 3010] of the Truth in Lending Act permits the premiums for credit life, accident or health insurance which is written in connection with a consumer credit transaction to be excluded from the finance charge if the insurance is not required, this fact is disclosed, and the borrower elects to receive the coverage after disclosure of the cost thereof. Likewise, § 106(c) [¶ 3010] permits the premiums for insurance against loss of or damage to property or against liability to be excluded from the finance charge where the borrower is entitled to choose the person through which the insurance is to be obtained, and the cost of the insurance is disclosed to him. The corresponding provisions in § 226.4(a) (5) [¶ 3518] and (6) [¶ 3518] of Regulation Z likewise require the “cost” of the insurance to be disclosed.
      ' In May of 1969, shortly before the Regulation was to become effective, the Board was confronted with the question of what “cost” should be disclosed under these provisions where policies for less than the full term of the obligation were being offered. This might occur, for example, in the case of property insurance where the policy would be written for only a few years at a time, and where the premium would be adjusted from time to time thereafter in connection with subsequent purchases of insurance. Moreover, in some cases, property insurance might not be required for the full term of the obligation. Likewise, in some cases, credit insurance (particularly mortgage insurance) may be written for less than the full term of the obligation. In such circumstances the question arose as to what “cost” should be disclosed to meet the provisions of § 226.4(a)(5) and (6). Interpretation 226.402 was issued to answer that question.
      The issue was framed in the opening paragraph of interpretation 226.402 as “whether such amounts of cost disclosed must include the cost of insurance for the full term of the transaction.” The answer was given that where the cost of insurance is not required to be included in the finance charge the .cost to be disclosed need only be the cost for the term of the “initial” policy or policies, as long as accompanied by a statement of the type of insurance and the term. In other words, while the Board did indicate that the cost disclosure requirements could be met by disclosing the cost for less than the full term of the obligation, in such cases it believed that the consumer should be placed on notice that the quoted premium was for less than the full term of. the obligation.
      We believe it was not the Board’s intent to add a blanket requirement to either § 226.4 (a) (5) or (6) by interpretation 226.-402 that in all cases in which the insurance cost is disclosed the term of the obligation must also be shown. Specifically, in our opinion the term of the insurance coverage need not be shown where the coverage is for the full term of the obligation.
      The author of this Opinion Letter was Griffith L. Garwood, Adviser, Division of Supervision and Regulation, Board of Governors of the Federal Reserve System. Mr. Gar-wood represented the Federal Reserve Board at Truth in Lending oversight hearings held last year by the Subcommittee on Consumer Affairs, House Committee on Banking and Currency. CCH Instalment Credit Guide, Report No. 125, at 8-9 (August 2, 1973). See also Garwood, Truth in Lending — A Regulator’s View, 29 Bus .Law. 193 (1973).

      . Philbeck challenges the reliability of Federal Reserve Board Opinion Letters and, in doing so, relies on Thomas v. Myers-Dickson Furniture Company, 5 Cir., 1973, 479 F.2d 740, 747, in which this Court declined to follow a suggestion made in an Annual Report of the Board that pointed out a possible ambiguity in the Truth in Lending statute and suggested, without analysis, what was the “more likely” meaning. That situation, however, the Board suggesting the “more likely” meaning of the bare statute passed by Congress, is a far cry from what we deal with here. Here, the Board, in response to a specific problem, has issued an Opinion Letter analyzing, in some detail, its own official Interpretation of Regulation Z, which had been promulgated by the Board pursuant to its authority under the Act.

      . By way of analogy, we note that in a situation similar to that discussed in Interpretation § 226.402, the Board requires that the date upon which the finance charge begins to accrue must be disclosed only “if different from the date of the transaction.” Regulation Z, § 226.8(b)(1), 12 C.F.R. § 226.-8(b)(1).

      . See note 4 supra.

      . See generally Andrucci v. Gimbel Brothers, Incorporated, W.D.Pa., 1973, 365 F.Supp. 1240, 1243:
      [T]he obvious intent of Congress was to set standards by which to achieve meaningful “truth-in-lending” and not to deviously set traps by which windfalls could be reaped by fanciful lawyers.