Court Opinion

ID: 9498818
Source: CourtListenerOpinion
Date Created: 2023-08-05 17:28:59.465075+00
Date Added: 2024-06-11T17:59:05.481198
License: Public Domain

WIDENER, Circuit Judge,
dissenting:
I respectfully dissent.
I begin with the full text of the fiduciary exception to the statutory definition of “debt collector”:
The term [debt collector] does not include^—
(F) any person collecting or attempting to collect any debt owed or due or *380asserted to be owed or due another to the extent such activity (I) is incidental to a bona fide fiduciary obligation or a bona fide escrow arrangement,
15 U.S.C. 1692a(6). It is undisputed that defendants were trustees on the deed of trust. (JA 22, 41.) This means that they were fiduciaries as a matter of law. See Bunn v. Kuta, 109 Md.App. 53, 674 A.2d 26, 32 (1996); Whitlow v. Mountain Trust Bank, 215 Va. 149, 207 S.E.2d 837, 840 (1974).1 And there is no reason to doubt their bona fides. But the majority offers a different reason to avoid the exception: defendants’ actions were “central” to their fiduciary duties, not “incidental” as the statute provides. Slip op. 7.
Such a construction of the statute is not logical, I suggest. “Incidental” means “occurring merely by chance or without intention or calculation” or “being likely to ensue as a chance or minor consequence.” MerriamWWebster Collegiate Dictionary 586 (10th ed.2000). And “central” is defined as “of cardinal importance: essential, principal.” Id. at 185. Even assuming that a foreclosure is “central” to the defendants’ duties, the majority conclusion that a central task incident to the duty is not exempted does not follow from the premise. If the exception covers the minor unintended acts relating to incidental fiduciary duties, it must cover the principal acts as well. Otherwise the exception would accomplish very little, for the majority definition excludes “other bona fide fiduciaries” which are included in the Senate Report, infra.2
The legislative history of the fiduciary exception further erodes -the majority reasoning. It shows that the original House version of the bill did not include the exception for fiduciaries. See H.R.Rep. No. 95-131, at 4, 11, 17-18 (Mar. 29, 1977). Only later did the Senate add it. See 123 Cong. Rec. at 27384 (Aug. 5, 1977) (text of Senate version); see also id. at 28109-13 (House adopting Senate amendments). So including the exception within the statute was a deliberate act. Moreover, the Senate committee report explained the purpose of the amendment:
[T]he committee does not intend the definition [of debt collector] to cover the activities of trust departments, escrow companies, or other bona fide fiduciaries. (Italics added.)
S.Rep. No. 95-382, at 3, reprinted at 1977 U.S.C.C.A.N. 1695, 1698; see also id. at 1701. This explanation is on point and unambiguous. We should not ignore such unambiguous text, especially when it is augmented by the balance of the legislative history referred to.
Yet the FTC Staff Commentary, which is the only authority particular to the fiduciary exception cited by the majority, does just that. The Commentary provides that the exception does not apply to trustees named “solely for the purpose of conducting a foreclosure sale.”3 This innovation conflicts not only with the statutory text but also with the Senate report set forth *381above. We have declined to follow the Commentary in past FDCPA cases upon discerning such a conflict, see Scott v. Jones, 964 F.2d 314, 317 (4th Cir.1992), and we should do so again here. Our obligation not to follow the FTC Commentary is reinforced by the Commentary’s self-doubt which appears at the beginning of the Commentary. Reciting that the Supreme Court has held that the Commentary was not binding and not entitled to deference when it conflicted with the plain language of the statute, the Commentary continued:
“[I]t is not clear whether the FTC has the authority to issue the Commentary [and] courts have little difficulty disregarding Commentary positions [viewed] as incorrect.” JA 129, see Heintz v. Jenkins, 514 U.S. 291, 115 S.Ct. 1489, 131 L.Ed.2d 395 (1995).
Tellingly, even this self-abnegation over states the FTC’s authority under the Act which the statute itself limits:
Neither the [Federal Trade] Commission nor any other agency referred to in subsection (b) of this section may promulgate trade regulation rules or other regulations with respect to the collection of debts by debt collectors as defined in this subchapter.
15 U.S.C. § 16921(d). This provision, like the fiduciary exception, is unambiguous. So is its legislative history:
“I want to make a special point: No Federal agency will write regulations for this legislation.” 123 Cong. Rec. 10241 (Apr. 4,1977) (statement of Rep. Annun-zio).
And § 16921(d) too, was itself an amendment. See id. at 10255 (statement of Rep. Rousselot noting amendment); see also the Senate Report, 1977 U.S.C.C.A.N. at 1703, which describes making of the FTC regulations as “prohibited.” For various reasons given by courts which have cited the FTC Commentary, they decline to give it Chevron deference,4 instead analyzing it as contrary to the statute or in terms of power to persuade, or lack thereof. See, e.g., Goswami v. Am. Collections Enter., Inc., 377 F.3d 488, 493 n. 1 (5th Cir.2004); Scott, supra, 964 F.2d at 317. But the majority relies upon the FTC Commentary. This, despite the fact that the single sentence deemed dispositive does not explain, or pretend to explain, the legislative history including the Senate Report, rather it contradicts the statutory text and the Senate report as if Congress were not the principal instrument of public policy.
“... it is equally — and emphatically— the exclusive province of the Congress not only to formulate legislative policies and mandate programs and projects, but also to establish their relative priority for the Nation.” Tenn. Valley Authority v. Hill, 437 U.S. 153, 194, 98 S.Ct. 2279, 57 L.Ed.2d 117 (1978).
Even setting aside our duty to look first to Congress, I can think of no rationale for the agency’s position other than a Shakespearean distrust of lawyers. And the Commentary’s other policy flaws are plain: for instance, it fails to recognize that the duty of a lawyer-trustee under such a deed of trust runs to the property and, as well, to the borrower and the lender. See, e.g., White v. Simard, 152 Md.App. 229, 831 A.2d 517, 524-25 (2003); Powell v. Adams, 179 Va. 170, 18 S.E.2d 261, 262-63 (1942). This difference between a lawyer-trustee and a lawyer who is merely a debt collector, although patent, is not explained.5
Accordingly, I would affirm.

. The offices of Draper & Goldberg are in Virginia, the deed of trust in question is in Maryland.

. The appellate cases mentioning the exception do not bear upon this case. See Pelfrey v. Educ. Credit Mgmt. Corp., 208 F.3d 945 (11th Cir.2000) (per curiam), aff’g 71 F.Supp.2d 1161 (N.D.Ala.1999) (applying exception to assignee of guarantor of defaulted student loan); Buckman v. Am. Bankers Ins. Co. of Fla., 115 F.3d 892, 895 (11th Cir.1997) (not considering exception).

.Limiting by their appointment the duty of the trustees to be “solely for the purpose of conducting a foreclosure sale” is not shown in the record in this case. (Italics added.)

. Chevron USA v. Natural Resources Defense Council, Inc., 467 U.S. 837, 104 S.Ct. 2778, 81 L.Ed.2d 694 (1984).

. The trustee, for example, must publicly account for the distribution of the proceeds of the sale. See generally In re: Trustee’s Sale of the Property of Willie Brown, et al., 67 Va. Cir.204 (2005).