Court Opinion

ID: 8915664
Source: CourtListenerOpinion
Date Created: 2022-11-27 04:56:45.484996+00
Date Added: 2024-06-11T17:08:57.475766
License: Public Domain

WEICK, Senior Circuit Judge:
I respectfully dissent. The law in the present appeals was conclusively determined in the recent decision of the Supreme Court in Fidelity Federal Savings & Loan Association v. de la Cuesta, - U.S. -, 102 S.Ct. 3014, 73 L.Ed.2d 664 (1982), which upheld the validity of a regulation prescribed by the Federal Home Loan *146Board (Board), authorized by Section 5(a) of the Home Owners’ Loan Act of 1933 (HOLA), empowering a federal savings and loan association to include on its loan instrument a “due-on-sale” clause that permits the association to declare the entire balance of the loan immediately due and payable if the property securing the loan is sold or otherwise transferred without the association’s prior written consent.
The preamble to this lawful regulation stated that the due-on-sale practices of federal savings and loan associations shall be governed “exclusively by Federal law” and that the association “shall not be bound by or subject to any conflicting State law which imposes different ... due-on-sale requirements.” The Supreme Court held that the regulation had the force and effect of law and preempts conflicting state limitations on the due-on-sale practices of federal savings and loan associations. It is our duty and function to apply and follow the Supreme Court’s opinion. The district court erroneously held it had no jurisdiction over the controversy and dismissed the complaint. It applied conflicting Michigan law rather than federal law, which it was under duty to apply.
The majority in the present appeal cites the 1977 conflicting decision of the Michigan Court of Appeals in Nichols v. Ann Arbor Savings & Loan Association, 73 Mich.App. 163, 250 N.W.2d 807, holding that “due-on-sale” clauses could not be enforced in Michigan unless the lender could prove that such clause was reasonably necessary to protect the lender from the impairment of its security. The majority holds that a federal court in an action for declaratory judgment is even without jurisdiction to decide the issue as this relates only to a possible defense which may be asserted in an action brought by the lender. Actually, it relates to something much more than that, namely, the Supremacy of the federal law. The majority also relies on and holds that it is bound by the decision of a divided panel of this court denying jurisdiction in a similar case Michigan Savings & Loan League v. Francis, 683 F.2d 957, Sixth Circuit in an opinion filed on July 8, 1982. This opinion in Francis was obviously written sometime prior to the decision of the Supreme Court, but was filed subsequently thereto, as it does not even mention or discuss the Supreme Court decision which compels a different result. Chief Judge Edwards dissented holding that the court had jurisdiction and cited authority in support of his dissent. The court in Francis pointed out that the Michigan Anti-Redlining Act authorizes the Michigan Building and Loan Commissioner to enforce the Act by himself imposing fines of up to $10,000 for each violation, M.C.L.A. § 445.-1602(l)(a), and that he had written to all Michigan credit granting institutions indicating his intent to impose a fine against each of them unless they complied with the Act by October 1, 1978.
To hold that federal courts under these circumstances are powerless to enforce compliance with federal law borders on being ridiculous. Jurisdiction is expressly provided by 28 U.S.C. §§ 1331(a) and 1337. We are bound by the decision of the Supreme Court and not bound by the decision of another panel of this court conflicting therewith.
The majority opinion in the present case even closes with the following statement:
Although we have little doubt that Fidelity Federal Savings & Loan Association should mandate that Michigan law restricting enforcement of the due-on-sale clauses of federal S&L associations is preempted by contrary federal law, that ultimate determination must await hearing by a court of appropriate jurisdiction.
We have appropriate jurisdiction as hereinbefore provided and we ought not to delay our decision any longer.
I would reverse the judgment of the district court and remand for further proceedings.