Questions about encoding between two databases

Hello,

I am sitting on version 7.4.x and am going to upgrade to version 8.3.x.
>From all I can read I should have no problem with actual format of the
pgdump file (for actual dumping and restoring purposes) but I am
having problems with encoding (which I was fairly sure I would). I have
searched the web for solutions and one solution given (in one thread where
Tom Lane answered) was to set the correct encoding in the version 8.3.x
database.

However, the default encoding in the version 8.3.x instance is
currently UTF8 and I am happy with that. The encoding for most of the
databases in the version 7.4.x was LATIN1. Is there any way I can ignore
the LATIN1 encoding and force the database to accept the UTF8 encoding of
the new version 8.3.x instance?

I get the below message when I try the psql -f <file> <database> command.

psql:aranzo20090812:30: ERROR: encoding LATIN1 does not match server's
locale en_US.UTF-8
DETAIL: The server's LC_CTYPE setting requires encoding UTF8.

Any help would be appreciated.

Archie