Court Opinion

ID: 5348630
Source: CourtListenerOpinion
Date Created: 2022-01-08 06:29:34.160143+00
Date Added: 2024-06-11T08:29:41.508728
License: Public Domain

Dore, J. (concurring).
In my opinion the contract in question is an obvious device and subterfuge to evade the usury laws. In this case the money lender charged $60 for a loan of $200 for a period of ten months, i. e., approximately sixty-five per cent per annum computed on unpaid balances; and also provided for other disbursements which were deducted from the loan, and in addition attempted to collect attorney’s fees of $19.50. These extortionate and oppressive charges for a small loan are clearly devices to evade the usury laws and are not made legal as is claimed by the terms of the so-called “ hazard agreement.”
If the mere form of a contract of this sort is to be controlling, the statutes against usury are unenforcible. Not the mere form but the intent, as indicated by all the facts and circumstances, should govern. Here in plain fact within the intent of the parties the personal obligation of the borrower was the real and primary source for satisfying the loan in spite of the language of the “ hazard agreement.” The hazards when scrutinized prove to be technical *102and unsubstantial. In the first place this agreement was not signed or accepted in writing by the lender whom it is supposed to burden with real hazards. It was signed only by the borrower and under the conditions specified in the document itself, assuming it could ever be enforced against the lender, it is clear that there is no actual or real likelihood that the borrower will escape personal responsibility which is carefully provided for in numerous clauses and conditions of the agreement. As was said by the United States Supreme Court in DeWolf v. Johnson (10 Wheat. 367, 385): “ Usury is a moral taint wherever it exists, and no subterfuge shall be permitted to conceal it from the eye of the law; this is the substance of all the cases, and they only vary as they follow the detours through which they have had to pursue the money lender.”
Except as hereinabove indicated, I entirely agree with the opinion of the majority of the court and concur in the result.
Determination unanimously reversed, with costs in this court and in the Appellate Term, and the judgment of the Municipal Court affirmed.