Court Opinion

ID: 9850004
Source: CourtListenerOpinion
Date Created: 2023-09-24 04:50:53.488907+00
Date Added: 2024-06-11T09:20:30.254440
License: Public Domain

Townsend, Judge,
concurring specially. This defendant executed a note to the plaintiff, a corporation duly licensed under the provisions of the Georgia Industrial Loan Act, Code Ch. 25-3, in the principal sum of $2,496.00. Of this sum he received $1,425.30, the remainder of the note going for the following: interest on principal amount, $344.27; 8% fee on the first $600 — $48.00; 4% fee on the remainder, $75.84; application fee, $1.00; life insurance $99.84 on the face amount.of the loan, and non-recording fee, $.60. Between that date and December 21, he paid back $936.00. On December 21, he renewed the loan for the full amount, and the plaintiff then issued a new note for $2,496.00 out of which the borrower received $365.17 — the remainder being $1,425.30 to pay off the first note, $344.27 interest, $48.00, $62.06, $1.00 and $.60' fees; $99.84 life insurance and $149.76 health and accident insurance on the face amount of the note. Thus, $365.17 in cash and 10 months in additional credit the defendant ran up additional expenses of $705.53 which he also would have to repay over the life of the note. He was allowed an insurance rebate of $30.28 and an interest rebate of $104.42, both figured in accordance with Code (Ann.) § 25-317 and therefore perfectly legal although the result was to refund the unaccrued interest at a discount basis and then make a new charge at the regular 8% rate. Subtracting these amounts, the additional $365.17 which the defendant received plus the additional extension of credit entailed an added expense of $570.83 to be repaid in addition to the $365.17 received. Since the monthly payments remained the same — $104 — the extension of credit did not benefit the defendant; what he actually *657did was to contract for 10 additional payments of $104 each in order to pay back the principal, interest and expenses of the $365.17 in money which he received in December, 1957. This was not, however, usurious under the terms of Code (Ann.) § 25-315 (b) which permits collection of the entire fee if the loan is refinanced after it has been carried for more than six months.
The trial court sustained the general demurrer on the theory that the wording of the note which allows collection of attorney fees of 15% “if collected by law or through an attorney at law” rendered the note usurious if the company chose to collect the note by suit without utilizing the services of an attorney. Code (Ann.) § 25-316 provides for “attorney fees authorized by law incurred in the collection of any contract in default.” (Italics mine.) The corporation here utilized the services of a firm of attorneys. Code (Ann.) § 20-506 provides for the lawful inclusion in notes of obligations to pay 15% as attorney’s fees. The words “collected by law” may well mean “collected through an attorney at law”, or the former may mean collected by an attorney after suit and judgment, and the latter collected by an attorney at law, though before suit or before judgment. Since the provisions of a contract will be given that construction which is legal rather than that which is illegal where the wording is ambiguous (Hartsfield Co. v. Shoaf, 184 Ga. 378, 381, 191 S. E. 693) and since obligations, the terms of which are fixed by statute, will be construed in conformity with the statute, the contrary not affirmatively appearing as the intention of the parties, the words of this note “collected by law or through an attorney at law” will not be given such construction as to render the note usurious and the entire obligation void (Code, Ann., § 25-9903) where such intention does not clearly appear and the note was in fact sought to be collected in a perfectly legal manner through an attorney at law and also at law, that is, by suit in court. I accordingly agree that the trial court erred in sustaining the general demurrer as there is no defect such as .usury appearing on the face of the petition or the notes, copies of which are thereto attached and on which the suit is based.