Court Opinion

ID: 8180398
Source: CourtListenerOpinion
Date Created: 2022-09-09 22:33:54.563222+00
Date Added: 2024-06-11T16:40:09.653204
License: Public Domain

Sprouse, Justice,
concurring:
I concur with the majority opinion. There are assuredly areas in which a lender should be able to charge higher interest rates than would be desirable or permissible for a well-secured conventional loan. Flexible interest rates for the sale of goods would not only stimulate the economy, but would compensate the lender for higher risk and costlier loan administration. There are undoubtedly some circumstances involving real estate sales where higher interest rates for a loan or forbearance would be in the public interest. There are also other commercial *521transactions in which a permissible range of interest rates rather than one fixed maximum rate would better serve the public policy of this State.
The “time-price” doctrine, however, in my opinion is a fiction created to serve this public policy. It is fallacious for the State to permit only an 8 percent interest charge when the borrower or buyer desires to repay the loan proceeds over a period of time, but to allow a higher interest rate when the lender utilizes the magic words indicating a present cash price, but a higher price if payment is to be made at a later date. Aside from the basic fiction, the weakness of the doctrine is that it permits each lender to determine the public policy questions of what additional charge a borrower should pay for various risks, loan administration difficulties, or other commercial problems. While lenders should have flexible interest rates for different type loans ' or forbearances, the welfare of lender, borrower and the public would be better served if the “time-price” doctrine were completely repudiated and permissible limits established by the legislature.
The majority opinion is scholarly, long, and many points are well presented. I feel, however, the statement of Syllabus Point 21, concerning interpretation of the use of the disjunctive and injunctive, is too broad. Moreover, I think there should be one uniform standard of evidence to prove usury whether the usurious charge appear from the face of the instrument or from the conduct of the parties. The standard should require a simple preponderance of the evidence. This would simplify the trial for the court and jury. Empirically, it is probably the tool used by juries regardless of court instructions simply because they have difficulty applying such technical distinctions. Finally, I would have applied the results of this decision prospectively.
Justice Berry, deeming himself disqualified, did not participate in the consideration or decision of this case.