USA Payday Cash Advance Centers v. Oxendine

USA Payday Cash Advance Centers v. Oxendine

DECIDED: 1, 2003 august

Summary judgment. Fulton Superior Court. Before Judge Long.

installment loans online

Troutman Sanders, William M. Droze, David M. Green, for appellants.

Thurbert E. Baker, Attorney General, Sidney R. Barrett, Jr., Isaac Byrd, Senior Assistant Attorneys General, Samantha M. Rein, Assistant Attorney General, for appellee.

United States Of America Payday Cash Advance Centers, American advance loan, Inc., EZ Credit, Inc., Fast money `Til Payday, Inc., Great American advance loan, Inc., Great American Credit, Inc., Monday `Til Payday, Inc., United States Of America pay day loan, Inc., United States Of America payday advances Advance Center #8, Inc., United States Of America payday advances Advance Center #9, Inc., United States Of America cash advance Center #10, Inc., United States Of America cash advance Center #11, Inc., United States Of America cash advance Center #12, Inc., United States Of America cash advance Center #13, Inc., and United States Of America cash advance Center #14, Inc. Brought a declaratory judgment action against John W. Oxedine, indiv motion for summary judgment had been provided because of the test court for Oxendine. Finding no mistake, we affirm.

In July of 2002, the Commissioner authorized a study of the loan that is”payday tasks of USA Payday Advance Centers. An administrative “show cause” order issued, and the plaintiffs were among the parties named in the order as a result of the examination. Following the hearing on October 11, 2002, the Commissioner unearthed that the plaintiffs had been in breach for the Industrial Loan Act for making loans with no commercial loan license plus in making false and misleading advertisments of loans; the Commissioner commanded them to stop and desist from making loans “except as permitted beneath the Georgia Industrial Loan Act. ” Plaintiffs had been charging you an interest that is annual of 650%. On October 22, 2002, the court that is superior plaintiffs’ benefit of your order. On 2, 2002, plaintiffs dismissed that appeal december.

The loans were now made by County Bank through them on December 3, 2003, plaintiffs filed this declaratory judgment action and alleged that they no longer made the loans but that, as “service providers” for County Bank. November 13, 2002, ended up being the date that is effective such start up business procedure to begin with. Plaintiffs reported an exemption through the Georgia Industrial Loan behave as agents for the bank that is out-of-state. Nevertheless, such provider contract, which was alleged into the verified pleadings, had been never placed into proof.

During the time that the declaratory judgment action ended up being brought, the Commissioner hadn’t decided whether or otherwise not to start a study into plaintiffs’ start up business arrangement with County Bank, due to the fact Commissioner had no details about this new arrangement and loans together with taken no place in regards to the brand new procedure.

The Commissioner relocated for summary judgment regarding the grounds that no “actual or justiciable debate” existed with regard to plaintiffs’ brand new arrangement with County Bank and that there have been no ruling desired on plaintiffs’ brand brand new arrangement by the Commissioner pursuant to their laws allowing demands for declaratory rulings. Consequently, plaintiffs neglected to exhaust its administrative treatments just before looking for judicial action.

Under OCGA § 7-3-1 et seq., the Georgia Industrial Loan Act, loans under $3,000 or less come in the ambit regarding the Act. “a loan that is payday that loan of brief period, typically a couple of weeks, at an astronomical yearly interest rate. ” Smith v. Steinkamp, 318 F. 3d 775, 776-777 (7th Cir. 2003). Payday advances are the existing type of “salary buying” or “wage buying. ” See Gunnels v. Atlanta Bar Assoc., 191 Ga. 366, 381(3) ( 12 S.E. 2d 602) (1940); Hinton v. Mack Publishing Co., 41 Ga. App. 823, 826 ( 155 SEARCH ENGINE 78) (1930). The costs, fees, and interest on an online payday loan are between 15% and 30% associated with principal for the two-week loan, constituting a pretext for usury. Cashback Catalog selling, Inc. V. Cost, 102 F. Supp. 2d 1375, 1380 (S.D. Ga. 2000); see also Greenberg v. Commonwealth, 255 Va. 594 ( 499 S.E. 2d 266) (1998); White v. Always check Holders, Inc., 996 S.W. 2d 496 (Ky. 1999). Considering that the Georgia Industrial Loan Act ended up being enacted to “define and avoid usury” and also to offer a supply of regulated funds “for people who have been borrowing at usurious prices from loan sharks, road shylocks and wagebuyers, ” then such financial transactions come inside the jurisdiction associated with the Act. Therefore, the Industrial Loan Commissioner has jurisdiction over “wage-buyers. ” OCGA § 7-37-1 et seq.; 1954-56 Op. Att’y Gen. At pp. 385-386. Then”payday loans” violate the Georgia Industrial Loan Act if the maximum interest rate is over the limit set by OCGA § 7-3-14 of 10% or the lender fails to hold an industrial license issued by the Commissioner. See 2002, Op. Att’y Gen. No. 2002-3.

Freeman v. Decatur Loan Finance Corp., 140 Ga. App. 682, 685 ( 231 S.E. 2d 409) (1976).

Some payday lenders have contracted with federally chartered banks or state chartered banks insured by the FDIC to take advantage of federal banking laws that allow such banks to make loans across state lines without regard to that state’s interest and usury laws in “rent-a-charter” or “rent-a-bank” contracts in an attempt to circumvent state usury laws. See State of Colorado ex rel. Salazar v. ACE Cash Express, Inc., 188 F. Supp. 2d 1282, 1285-1286 (D. Colo. 2002); Long v. ACE money Exp., 2001 U.S. Dist. Lexis 24617 (M.D. Fla. 2001); Goleta Nat’l Bank v. Lingerfelt, 211 F. Supp. 2d 711 (E.D.N.C. 2002). Whether it has happened in this situation and whether it’s legitimate or a mere subterfuge meant to circumvent Georgia usury guidelines can’t be reached in cases like this, considering that the plaintiffs did not exhaust administrative treatments and also to place the contract with County Bank into proof.

Beneath the separation of capabilities underneath the Georgia Constitution, the judicial branch does not have jurisdiction to cope with an executive branch function until there is an fatigue of administrative remedies, for example., the executive branch does not have any further remedy. The precise empowerment that is legislative judicial summary of executive action is strictly followed. Perkins v. Dep. Of medical attention, 252 Ga. App. 35, 36-38(1) ( 555 S.E. 2d 500) (2001). The explanation is the fact that “resort towards the administrative process will let the agency to utilize its expertise, protect the agency’s autonomy, enable a far more efficient quality, and lead to the consistent application of issues inside the agency’s jurisdiction. ” Cerulean Co., Inc. V. Tiller, 271 Ga. 65, 67(1) ( 516 S.E. 2d 522) (1999). A plaintiff “is forbidden from doing by indirection that which its prohibited from doing straight, i.e., bypassing the fatigue of administrative appeals. ” (Citations omitted. ) Perkins v. Dept. Of medical attention, supra at 38.

Long-standing Georgia legislation calls for that an event aggrieved by a situation agency’s choice must raise all problems before that agency and exhaust available administrative remedies before searching for any judicial summary of the agency’s choice. Provided that there was a highly effective and available administrative remedy, a celebration is needed to pursue that treatment before searching for equitable relief in superior court.

Cerulean Co., Inc. V. Tiller, supra at p. 66. Subsequently,

An action for declaratory judgment will never be amused in which the liberties regarding the events have previously accrued together with plaintiff faces no threat of using future undirected action. The place where a statute provides a celebration with an easy method of review by an administrative agency, such procedure is usually a satisfactory treatment at legislation in order to preclude the grant of equitable relief.