CORDOVA V. Business Money CORP. Away from NM

CORDOVA V. Business Money CORP. Away from NM

CORDOVA V. Business Money CORP. Away from NM

Barnett Lawyer, P.A good., Mickey D. Barnett, Phillip W. Cheves, David Good. Garcia, Amy B. Bailey, Albuquerque, NM, Wolf and you can Fox, P.C., Amy B. Bailey, Albuquerque, NM, having Petitioner.

This part shall not make-up a great waiver out-of Lender’s rights thereafter to get certain administration of their rights under it Agreement during the the big event Debtor will insist a great counterclaim or right out-of setoff this kind of official otherwise non-official action

Feferman & Warren, Richard Letter. Feferman, Robert Dale Treinen, Albuquerque, NM, Personal Fairness, P.C., F. Paul Boring, Jr., Arizona, D.C., getting Respondent.

Doerr & Knudson, P.A great., Randy J. Knudson, Portales, NM, AARP Basis, Deborah M. Zuckerman, Arizona, D.C., for Amicus Curiae AARP.

Gary K. Queen, Attorney General, David K. Thomson, Assistant Attorneys General, Scott Fuqua, Secretary Attorney Standard, Santa Fe, NM, to have Amicus Curiae Place of work of one’s Attorneys General.

CHARLES W. DANIELS, Justice We Consent: EDWARD L. CH?VEZ, Master Justice, PATRICIO Meters. SERNA, Justice, PETRA JIMENEZ MAES, Fairness, RICHARD C. BOSSON, Justice.

<1>This case requires us to review the validity of a small loan company’s form arbitration provision that would limit a borrower to mandatory arbitration as a forum to settle all disputes whatsoever, while reserving for the lender the exclusive option of access to the courts for all remedies the lender is most likely to pursue against a borrower. We hold that such an inherently one-sided agreement is against New Mexico public policy and is therefore void as unconscionable.

<2>Defendant World Finance Corporation of New Mexico (World Finance) specializes in small loans at over 100% annual interest rates. Over the course of several years, Plaintiff Laura Cordova (Cordova) signed ten separate loan agreements with World Finance that grew out of just two original loans. The loans were repeatedly rolled over into new loans, and Cordova never succeeded in paying off any of them before signing each new agreement.

<3>All ten of World Finance’s loan agreements included the company’s separately-signed form arbitration attachment. The first paragraph of the printed arbitration provision broadly stated that the parties must arbitrate all disputes arising under, but not limited to:

? the loan Contract and you will one early in the day or subsequent loan out of Lender and you may one earlier in the day or next retail installment conversion process price created using/or assigned to Lender and additionally most of the data according to exact same and you can insurance bought in contact with your order;

? people claim dependent a federal otherwise condition law in addition to, but not limited by, your situation-in-lending Act and you can Controls Z; the fresh new Equal Borrowing from the bank Possibility Act and you will Controls B, state insurance rules, condition usury and you will lending rules also county individual defense regulations and you can regulations;

While we disagree some within court data, we affirm the option of the Legal off Is attractive and you can keep that the section courtroom was best within the doubting the borrowed funds organizations actions to compel arbitration of your own borrower’s official says

? any argument on closing, maintenance, collecting or enforcing the loan Arrangement or any other mortgage otherwise shopping cost conversion arrangements anywhere between Financial and you will Borrower

<4>However, a separate paragraph in the form also provided that the lender alone had the exclusive and unlimited alternative to seek any judicial remedies it might otherwise have available to it in law or in equity in the event of a default by the borrower:

Despite that it Arrangement, in case there is a default in Loan Contract, Bank can get seek its cures when you look at the an activity on laws otherwise into the equity, together with but not limited by, judicial property foreclosure or repossession. Financial also can exercise its almost every other treatments available with law (such, however limited to, the best out of care about-help repossession below Blog post 9 of one’s Uniform Industrial Code or most other applicable law and you can/and/or foreclosures power of sale).