Whitaker v. Spiegel, Inc.

• Court: Washington Supreme Court
• Writing for the Court: BRACHTENBACH
• Citation: Whitaker v. Spiegel, Inc., 95 Wn.2d 661, 637 P.2d 235 (Wash. 1981)
• Decision Date: 04 June 1981
• Docket Number: No. 47087-1
• Parties: George WHITAKER, et al., Respondents, v. SPIEGEL, INC., Appellant.

Page 661

95 Wn.2d 661

637 P.2d 235

George WHITAKER, et al., Respondents, v. SPIEGEL, INC., Appellant.

No. 47087-1.

Supreme Court of Washington, En Banc.

June 4, 1981.

Appeal Dismissed Nov. 2, 1981.

See 102 S.Ct. 496.

ORDER AMENDING OPINION UPON MOTION FOR RECONSIDERATION

BRACHTENBACH, Chief Justice.

The Court having considered the appellant's motion for reconsideration herein, and desiring to revise and clarify the opinion of the Court in certain respects, it is hereby ordered that the opinion of the Court in the above cause, as the same appears at 95 Wash.2d 408, 623 P.2d 1147, be changed as follows:

1. The sentence appearing in lines 13 through 16 on page 414, 623 P.2d 1151, is changed to read:

Rather, the legislature has directed that, in an action brought in Washington on an allegedly usurious transaction, Washington's usury law will apply if the debtor was a resident of Washington at the time the loan was made, even if the loan was made outside the state.

2. The following language is inserted immediately before the paragraph which begins in the third line from the bottom of page 423, 623 P.2d 1156:

Page 677

The last question we must decide is whether our decision should have a retroactive effect. In light of the impact on presently existing agreements entered into over many years in reliance on the usury statute, RCW 19.52, as construed in Hafer v. Spaeth, 22 Wash.2d 378, 156 P.2d 408 (1945), we think justice requires that this decision be applied prospectively only, except for a limited retroactive application to the parties in this case.

Courts may give a party the benefit of its own lawsuit, where that party has prevailed in its contention that the old law should be overruled. Cascade Security Bank v. Butler, 88 Wash.2d 777, 784, 567 P.2d 631 (1977). However, "(a)ppellate courts possess the power to give their decisions prospective effect, i.e., not to apply the decision to the parties in the overruling case." Cascade Security Bank, at 785, 567 P.2d 631. If a party has justifiably relied on the overruled case, we must decide whether a retroactive application of the overruling decision would defeat these reliance interests. Geise v. Lee, 10 Wash.App. 728, 732-33, 519 P.2d 1005 (1974), rev'd on other grounds, 84 Wash.2d 866, 529 P.2d 1054 (1975).

Over the years since the Hafer decision, there have been untold numbers of transactions in reliance on that decision. Indeed, the Attorney General has recently published an opinion advising that the usury statute did not apply to

Page 678

installment sales of real property and relying on Hafer. Attorney General Opinion, May 20, 1980. It would be unfair now to give our decision a general retroactive effect and expose well meaning vendors to the consequences of charging interest that has become usurious as a result of this decision. Thus, as to all...