Court Opinion

ID: 9527822
Source: CourtListenerOpinion
Date Created: 2023-08-07 03:34:35.213211+00
Date Added: 2024-06-11T13:26:14.378925
License: Public Domain

Worswick, J.
(dissenting)—Sharon Giger decided to provide Neil Ebling with money to start a business. She borrowed it from the plaintiffs. Undoubtedly, she trusted Ebling to pay it back, but he did not. Now called upon to pay, Giger claims that the loan was something other than it *179obviously was, a transaction primarily for business purposes. The majority agrees with Giger. I do not.
Although the majority relies heavily on Aetna Fin. Co. v. Darwin, 38 Wn. App. 921, 691 P.2d 581 (1984), it ignores two significant holdings of the case: (1) that the lender there did not establish that the loan was exclusively for business purposes; and (2) substance, not form, determines whether a loan is usurious. As to (1), the majority concedes that the statute has since been amended (see footnote 2), but assigns no significance to this. As to (2), the majority ignores this principle and here exalts form over substance, precisely what Aetna said should not be done. Aetna, 38 Wn. App. at 925. See also Clausing v. Virginia Lee Homes, Inc., 62 Wn.2d 771, 384 P.2d 644 (1963).
The statutory change is significant. There may have been room under the previous language for Giger to argue that, because part of the reason for the loan was to let her feel good about helping a friend, it was not "exclusively" for business purposes. There is no room for this argument now.
The substance of the transaction was entirely for business purposes. Ebling wanted to start the business. He shopped for the loan and located a lender. He was present at the closing. Giger immediately endorsed the check for the loan proceeds to Ebling. Absolutely everyone knew that the money was for Ebling's business.
The majority at page 176 states that the loan should be characterized according to the specific use of the money intended by the borrower. I agree. Giger, the borrower, specifically intended that the money be used to start Ebling's business. Therefore, I dissent for the reasons stated by the majority. See State v. Hornaday, 105 Wn.2d 120, 132, 713 P.2d 71 (1986) (Brachtenbach, J., dissenting).
Review granted by Supreme Court September 1, 1987.