Court Opinion

ID: 9775079
Source: CourtListenerOpinion
Date Created: 2023-08-29 18:43:07.675995+00
Date Added: 2024-06-11T07:32:19.936742
License: Public Domain

ON REHEARING George Rose Smith, J., on rehearing. In this case and in the allied cases that were decided on May 11 and May 25, 1953, the losing parties insist in petitions for rehearing that they have been deprived of their property without due process of law and have been denied the equal protection of the laws, in violation of the Fourteenth Amendment to the federal constitution. Ordinarily we do not consider questions raised for the first time on rehearing, but in fairness to the public we think it better to set this issue at rest now than to permit our views to remain undisclosed until the same question can be raised in future litigation. The argument now presented is based on the fact that we said in Ford v. Hancock, 36 Ark. 248, that if no bona fide credit sale is involved it is usurious to add more than ten per cent per annum to the cash price merely because time is given for its payment. As we explained in the original opinion in the case at bar, Ford v. Hancock has never been expressly overruled; but in a long series of later decisions we allowed the emphasis to shift gradually from substance to form, and in doing so we finally reached a point at which a loan of money could lawfully be disguised as a credit sale. In Hare v. General Contract Purchase Corp., 220 Ark. 601, 249 S. W. 2d 973, we returned to the spirit of Ford v. Hancock. In the Hare case we had three possible courses of action: (a) We might simply have adhered to the intervening decisions that had imperceptibly chipped away the foundation on which Ford v. Hancock rested. Such a holding would have involved no constitutional issue, since adherence to precedent is a basic principle of the common law. (b) We might have retroactively overruled those intervening decisions, thereby invalidating countless contracts made in reliance upon our declarations of the law. Even though such retroactive judicial pronouncements are permitted by the constitution, Tidal Oil Co. v. Flanagan, 263 U. S. 444, 44 S. Ct. 197, 68 L. Ed. 382, they are manifestly contrary to a sense of fair play. We could not in good conscience inform merchants that their reliance upon our many decisions had been foolhardy, that they should have guarded against the possibility that agreements lawful when made might later be declared void. We chose instead the third course — that of recognizing the validity of contracts made upon faith in our decisions; but at the same time we stated in detail the rules to be followed after the opinion became final. That course was so demonstrably fair to every one that it is difficult for us to comprehend how it can be thought to have been violative of the constitution. That same “novel stand,” however, was taken by the losing party in Great Northern R. Co. v. Sunburst O. & R. Co., 287 U. S. 358, 53 S. Ct. 145, 77 L. Ed. 360, and was there shown by Justice Cardozo to be wholly without merit. We can add nothing to his admirable discussion. Rehearing denied.