Wrenn v. Portland Loan Co.

• Decision Date: 19 January 1937
• Parties: WRENN et al. v. PORTLAND LOAN CO. et al.
• Court: Oregon Supreme Court

64 P.2d 520

155 Or. 395

WRENN et al. v. PORTLAND LOAN CO. et al.

Supreme Court of Oregon

January 19, 1937

In Banc.

Appeal from Circuit Court, Multnomah County; Robert Tucker, Judge.

Suit by Clifford C. Wrenn and another against the Portland Loan Company and another. From a judgment dismissing the suit plaintiffs appeal.

Affirmed.

Wm. P. Lord, of Portland (T. Walter Gillard, of Portland, on the brief), for appellants.

Joseph Van Hoomissen, of Portland (Linus M. Fuller, of Portland, on the brief), for respondents.

Dey Hampson & Nelson, Roscoe C. Nelson, R. R. Morris, Layton &amp Boyrie, Lester L. Ahlgrim, Teal, Winfree, McCulloch, Shuler &amp Kelley, and Alfred Kelley, all of Portland, amici curiæ.

CAMPBELL Justice.

On October 31, 1935, plaintiffs filed a suit in the circuit court for Multnomah county asking that a certain note and mortgage be declared void and of no effect.

It appears that some time prior thereto, plaintiffs executed a note in the sum of $300 in favor of defendant, Portland Loan Company, and to secure said note, executed a chattel mortgage on certain household goods and furniture. It appears that said loan was made under what is commonly known as the Small Loan Act (Oregon Laws 1931, chapter 385, p. 810, and the acts amendatory thereto), and that they were charged the full rate of interest permitted by said act; and that the Portland Loan Company had complied in all respects with the provisions of said act. Upon default, in the payment of said note, the defendant Portland Loan Company placed said chattel mortgage in the hands of the constable defendant Charles G. North, with directions to foreclose the same. Thereupon plaintiffs brought this suit for the purpose of having said note and mortgage declared void and to enjoin the constable from taking possession of said furniture and said household chattels, for the reason that a greater rate of interest was charged on said note and mortgage than was permitted by the general laws of the state of Oregon (section 57-1201 [155 Or. 397] et seq., Oregon Code 1930). After hearing, the court refused to enter an order restraining the constable. Plaintiffs thereupon refused to proceed further with the cause, and the same was dismissed with costs assessed against the plaintiffs. From this decree and judgment, plaintiffs appeal.

The plaintiffs, in this appeal, attack the constitutionality of the Small Loan Act (chapter 385, p. 810, Oregon Laws 1931, and the amendatory acts thereto) on the grounds: (1) That the said act is void because it violates subdivision 12, § 23 of article 4 of the Constitution of Oregon; and (2) that the said act is void because the subject of the act is not expressed in the title and therefore violates section 20 of article 4 of the Constitution of Oregon.

Section 23 of article 4 of the Constitution of Oregon provides:

"The legislative assembly shall not pass special or local laws in any of the following enumerated cases, that is to say-***

"12. In relation to interest on money."

Section 22 of chapter 385, Oregon Laws 1931 (page 816), provides in part: "It shall be unlawful for a licensee to charge, contract for or receive any interest or consideration at a greater rate than 3 per centum per month computed exactly on unpaid balances on loans, secured or unsecured, made to any one person in the aggregate sum of three hundred dollars ($300) or less."

Said chapter 385 applies to the whole state, and therefore is not a local law, nor do appellants make any contention that it is such, their contention being that it is special not as to locality, but to persons and things because it only applies to loans of $300 or less.

This court has had occasion heretofore to define special laws.

"A law may be general, however, and have but a local application, and it is none the less general and uniform, because it may apply to a designated class, if it operates equally upon all the subjects within the class for which the rule is adopted; and, in determining whether a law is general or special, the court will look to its substance and necessary operation, as well as to its form and phraseology. *** This is the accepted rule everywhere." Ladd v. Holmes, 40 Or. 167, 66 P. 714, 716, 91 Am.St.Rep. 457.

This court in Farrell v. Port of Columbia, 50 Or. 169, 91 P. 546, 547, 93 P. 254, in speaking of the term "general," as used in the provision of our Constitution now under consideration, said: "And, when it is used in contradistinction to 'special,' it signifies relating to the whole community or all of a class instead of to a particular locality or a part of a class. In this latter sense a law is general when it operates equally and uniformly upon all persons, places, or things brought within the relation and circumstances for which it provided. But when it is applicable only to a particular branch or designated portion of such persons, places, or things, or is limited in the object to which it applies, it is special. *** It is in this sense that the terms 'general' and 'special' are used in the provision of the Constitution now under consideration."

From the case of Mutual Loan Co. v. Martell, 222 U.S. 225, 32 S.Ct. 74, 75, 56 L.Ed. 175, Ann.Cas.1913B, 529, and quoted with approval in State v. Ware, 79 Or. 367, 154 P. 905, 155 P. 364, we take the following:

"We have declared so often the wide range of discretion which the legislature possesses in classifying the objects of its legislation that we may be excused from a citation of the cases. We shall only repeat that the classification need not be scientific nor logically appropriate, and if not palpably arbitrary, and is uniform within the class, it is within such discretion."

"Special or private acts are rather exceptions than rules, being those which only operate upon particular persons and private concerns." 1 Blackstone's Comm. 86, quoted with approval in Maxwell v. Tillamook County, 20 Or. 495, 26 P. 803.

The Small Loan Act was intended to enable persons to borrow small sums of money who did not possess what is ordinarily...