Waggener v. Holt Chew Motor Co.

• Decision Date: 11 October 1954
• Docket Number: No. 17373,17373
• Citation: 274 P.2d 968,130 Colo. 294
• Parties: Mark S. WAGGENER, Plaintiff in Error, v. HOLT CHEW MOTOR CO., Inc., a Colorado Corporation, Defendant in Error.
• Court: Colorado Supreme Court

Page 968

274 P.2d 968

130 Colo. 294

Mark S. WAGGENER, Plaintiff in Error, v. HOLT CHEW MOTOR CO., Inc., a Colorado Corporation, Defendant in Error.

No. 17373.

Supreme Court of Colorado, En Banc.

Oct. 11, 1954.

Rehearing Denied Nov. 1, 1954.

Means, Means & Roberts, Stanley H. Johnson, Denver, for plaintiff in error.

Shuteran, Robinson & Harrington, Denver, for defendant in error.

KNAUSS, Justice.

The parties hereto occupy the same positions here as in the trial court. Mark S. Waggener, hereafter referred to by name or as plaintiff, filed his complaint against Holt Chew Motor Co., Inc., hereinafter referred to as Holt Chew or lender, alleging that in October, 1952 he borrowed from Holt Chew the sum of $65,000, securing payment thereof by the execution of a deed of trust on real estate in El Paso County, Colorado; that said indebtedness was represented by Waggener's promissory note which provided monthly installments of principal and interest at two per cent per month on balances due. Plaintiff made installment payments of principal and interest on said indebtedness to and including May 23, 1953, so that on said date there remained due on said obligation, according to its terms, the sum of $29,000. Plaintiff alleged as a condition precedent to the making of said loan defendant demanded and received from plaintiff $2,500 for 'additional expenses, demands and services in addition to the interest provided for in said promissory note.' Plaintiff further alleged that Holt Chew was engaged in the business of making loans of money upon security and was not on October 23, 1952 licensed by the state of Colorado, pursuant to p. 400, chapter 108, S.L.Colo.1913. Plaintiff alleged he had paid $3,980 excess interest on said loan and claimed he was entitled to three times the total of such alleged overpayment of interest and the $2,500 for additional expenses and services, which amounts he prayed be applied on the balance of $29,000 claimed to be due on said note, and plaintiff offered to make payment of such balance and demanded a release of the deed of trust. It is not denied that plaintiff paid a total of $3,890 interest in excess of one per cent per month on said loan.

Depositions of witnesses were taken and certain affidavits filed in the trial court, following which both plaintiff and defendant filed motions for summary judgment. The trial court entered summary judgment in favor of defendant, and plaintiff brings the cause here by writ of error.

Chapter 108, S.L.Colo.1913 governs the matters involved in the instant case. We have so held in Sullivan v. Siegal, 125 Colo. 544, 245 P.2d 860 and Dowd v. Labor Finance Corporation, 100 Colo. 512, 69 P.2d 305.

The pertinent portions of the 1913 Act are:

'Section 1. That hereafter it shall be unlawful, without first procuring the license hereinafter provided for, to engage in the business of making loans of money or of personal credit, on any security of any kind, direct or collateral, tangible or intangible, upon which there is directly or indirectly charged or received interest, discount or consideration greater than twelve per centum per annum.'

Sec. 5 of the Act provides: 'That no person shall charge or receive a greater rate of interest upon any loan or upon any unpaid balance after any partial payment on any loan made by him than two per centum per month on the actual amount of the loan, and this charge shall cover all expenses, demands, and services of every character, including notarial and recording fees and charges, except upon the foreclosure of the security.'

Sec. 7 of the Act provides: 'Every person who, for any loan, or forbearance, shall have paid or delivered any greater sum or value than is above allowed to be received, may, by himself, or by his personal representative, recover in an action in any court of competent jurisdiction against the person who shall have taken or received the same, or against his personal representatives, treble the amount of the money so paid or value delivered above the rate aforesaid, together with costs * * *.'

Sec. 8 of the Act provides: 'The phrase 'engage in the business of making loans' as used herein shall be taken to apply to and include every person who shall make any loan of money or of personal credit upon any security whatsoever where the rate of interest, discount, or consideration charged is greater than twelve per centum per annum.' (Emphasis supplied.)

In Waddell v. Traylor, 99 Colo. 576, 64 P.2d 1273, 1275, we had occasion to pass upon the 1913 Act. There we held that the note was unenforceable as to interest in excess of the amount permitted by the statute. The maker of the note did not demand treble damages. In discussing Sec. 7 of the 1913 Act, we said: 'The provisions in the act, that treble the interest paid, if in excess of the rates specified, may be recovered, and that a violation of the act shall be a misdemeanor, amounts, we think, to a declaration of public policy that a contract for payment of interest in excess of the specified rate shall not be enforceable as to such excess * * *.' (Emphasis supplied.)

It is admitted that on October 28, 1952 the State Bank Commissioner received an application from Holt Chew for a license pursuant to chapter 108, S.L.Colo. 1913, dated October 22, 1952 (the day before the loan was made) and that said license was issued on November 28, 1952.

It appears from the depositions and affidavits on file in this cause that plaintiff advised his counsel William Hedges Robinson he was in need of a loan of $65,000 and asked Robinson if he could assist in procuring such a loan. Plaintiff said he had an opportunity to get the loan provided he paid two per cent per month interest; that he was reluctant to pay this rate of interest; that Robinson later advised plaintiff he thought he could get the loan and that the interest rate would not exceed ten per cent per annum. Robinson said his fee would be $1,000 if he found a lender. Plaintiff authorized Robinson to go ahead with the matter and after some delay plaintiff was called to the law office of Shuteran, Robinson and Harrington for the purpose of closing the loan. Mr. Robinson was not present and the closing of the loan was handled by Mr. Shuteran, counsel for Holt Chew. Waggener was advised by Mr. Shuteran the interest would be at the rate of twenty-four per cent per annum, and that the firm of Shuteran, Robinson and Harrington were making a charge of $2,500 for their services, which sum included $750 to be paid to L. E. Shuteran, a real estate broker and father of attorney Shuteran, for finding the lender. Other incidential items were included in the total of $2,500 paid by plaintiff to the law firm. The $65,000 check of defendant was left with Mr. Shuteran and he did not deliver it to plaintiff until his firm received the $2,500 from plaintiff.

The trial judge concluded from the depositions and affidavits before him that Holt Chew did not receive any part of the $2,500 represented by the check delivered to Mr. Shuteran by plaintiff before the $65,000 represented by the note and deed of trust was...