Opinion ID: 1692340
Heading Depth: 1
Heading Rank: 1

Heading: Whether the Alleged Violations Arose Out of a Consumer Credit Transaction.

Text: Defendant argues that in order to prove a violation of the ICCC, as alleged by plaintiff, a threshold element is the existence of a consumer credit transaction. This must be either a consumer credit sale, loan or lease. Iowa Code § 537.1301(11) (1985). For purposes of this appeal, we accept defendant's contention that only the sale of fuel, and not the lease of the tank, is involved with respect to the alleged violations in the present case. The alleged ICCC violations are (1) excessive finance charges relating to the March 22, 1984, sale of liquified petroleum gas; and (2) failure to give plaintiff a twenty-day notice of right to cure the default before acting to repossess collateral. [1] A consumer credit sale involves goods purchased primarily for personal, family or household purposes. Iowa Code § 537.1301(12)(a)(3) (1985). In addition, it is required that either (a) the debt is payable in more than four installments or (b) a finance charge is imposed. Iowa Code § 537.1301(12)(a)(4) (1985). Defendant urges that because the terms of the March 22 sale required payment in full within thirty days, a contention not disputed by plaintiff, the element of installment payments is missing. As to the imposition of a finance charge, defendant contends that, although the ledger account shows the imposition of a 1.75% per month finance charge on the account on April 30, 1984, that charge was in fact a default charge for an unanticipated late payment excluded from the definition of finance charge by Iowa Code section 537.1301(19)(b)(1) (1985). We disagree with the latter contention. The amount of the additional charge entered on the ledger on April 30, 1984, was $4.16 or 1.75% of the balance then showed to be owed. As shown by defendant's ledger entries dating back to November 1977, this matches the pattern of imposing finance charges on the plaintiff and Jim Landon's accounts throughout their course of dealing with defendant. The only exception to this practice was the brief period during which plaintiff had been placed on a strictly COD basis. All of the evidence presented, viewed most favorably toward the plaintiff, suggests that, based upon Ketchun's guarantee, the defendant permitted plaintiff to revert back to her former billing status as of the March 22 delivery. This included the former arrangement for imposing a finance charge. Viewed in this light, the charges imposed were not for unanticipated late payments so as to be excluded from the ICCC definition of finance charge by section 537.1301(19)(b)(1). They were monthly finance charges which would be waived if payment was made within thirty days. We conclude such charges qualify the transaction as a consumer sale.