Court Opinion

ID: 9632167
Source: CourtListenerOpinion
Date Created: 2023-08-22 11:05:23.10522+00
Date Added: 2024-06-11T18:08:09.964054
License: Public Domain

WADE, Justice
(concurring).
I concur. About the only benefit that can result from this litigation is that certain vicious results from the statutes on usury may be pointed out to the legislature for consideration in the future. I think it appropriate to call attention to some such results not emphasized in the prevailing opinion.
*543The usury statutes of our state provide a harsh remedy for their violation by providing that the lender shall lose not only the excessive interest charged, but all of the principal loaned. The only possible justification for such a harsh remedy is based on the theory that such lender has driven an unconscionable bargain, and the courts have been reluctant to find a violation has occurred where the facts do not clearly require such a finding. Too often the result of this situation is that the person who drives an unconscionable bargain stays technically within the law, but the person who has done nothing unfair finds that he has made a technical violation of the law and has to suffer the harsh penalty.1 Sometimes persons who intend to traffic in collecting unfair rates for loans lobby statutes through the legislature which appear to be innocent but in actual practice tolerate unconscionable rates of interest. I wonder if it would not more nearly accomplish the purpose to abolish this harsh penalty and provide one which would not work a great hardship in case of violation and thereby remove the strict construction against finding a violation. This proposition should be carefully considered by the legislature.
There is another very vicious thing about this statute. It appears on its face to merely allow a charge of interest at the rate of one per cent per month or 12 per cent per an-num over and above other charges. The average borrower legislator, lawyer, and judge who had not had occasion to figure the matter out, would be lead to believe that 12 per cent per annum was the top limit of the rate of interest chargeable under such statute, and we are shocked when we become conscious of the fact, as this case demonstrates, that under this statute the rate of interest may run as high as 37%. If the legislature was conscious of the fact that by enacting such a law they were permitting the collection of such a large percentage of interest, they would have been much more frank to say so in language which would convey that idea to everyone who reads the statute. This language *544seems to me to be calculated to mislead and give the impression that the rate allowable is much lower than it actually is. It is hard for me to believe that a legislature which deliberately enacted a statute which allows such an exorbitant rate of interest would feel that any good would be accomplished by any usury law. It seems to me to be highly inconsistent to prohibit a man from charging more than 10 per cent interest on a loan to his neighbor or business acquaintance, but at the same time allow a finance company to charge 37 per cent for same loan.
HENRIOD, Justice, concurs in result.