Court Opinion

ID: 9586380
Source: CourtListenerOpinion
Date Created: 2023-08-21 23:10:00.12278+00
Date Added: 2024-06-11T17:29:52.103834
License: Public Domain

COCHRAN, J.,
dissenting.
I share the majority’s sympathy for the borrowers in the present case who undoubtedly made bad bargains for themselves. In order to provide relief to these borrowers, however, the majority takes the position that one who makes a mortgage loan in an amount less than the maximum permitted under the Small Loan Act (now the Consumer Finance Act) is subject to the provisions of the Act.
Under the Act, mortgage loans are not permitted. Therefore, according to the majority, appellant Wiesen, who was never licensed under the Act,' attempted to evade compliance in violation of Code § 6.1-251 and became subject to the Act under Code § 6.1-249. Moreover, the majority holds that appellant Valley Acceptance Corporation, which arranged the loans as broker, is liable for the appellees’ attorney’s fees in the Glasby case under the provisions of Code § 59.1-204, part of the Virginia Consumer Protection Act of 1977. I disagree with both conclusions.
In my view, the Small Loan Act is not applicable to these loan transactions. Both the Harpers and the Glasbys answered an advertisement of Valley Acceptance Corporation offering mortgage loans. Both couples knew the loans were mortgage loans. Each couple was given a rescission form giving them the right, under federal law, to cancel the transaction within three business days. Each transaction was consummated as a mortgage loan with all the costs incident to that method of financing. That the costs were exorbitant in view of the small amount of each loan is undeniable. But there is no statutory prohibition against making mortgage loans in amounts below the maximum permitted by the Small Loan Act. Indeed, there may occasionally be necessity or at least justification for such a small mortgage loan. A borrower with limited income available for repayment of principal may resort to a mortgage loan payable upon future disposition of the property.
The General Assembly has continued to enact laws to protect the poor and the ignorant from those who would otherwise prey upon them. Although no statute can be devised to redress every unwise or foolish business decision, whether made by the poor and ignorant or by the rich and learned, the General Assembly provides the appropriate forum to consider whether it is advisable in *435the public interest to ban or restrict small mortgage loans. Absent legislative action, I would hold that the loans in these cases were valid mortgage loans and that appellant Wiesen was not subject to the provisions of the Small Loan Act.
Nor was the award of attorney’s fees against Valley proper. The Virginia Consumer Protection Act authorizes an award of reasonable fees “in addition to any damages awarded.” Code § 59.1-204. No actual damages having been assessed against Valley for a violation of that act, the Glasbys may not recover attorney’s fees.
STEPHENSON, J., joins in dissent.