Court voids extortionate interest on Meyers-loan

POSTED: 10/22/14 10:00 PM

St. Maarten – Interest rates on loans that exceed 18 percent per year are excessive and void, based on the principle of good manners. The Court in First Instance established this in a ruling earlier this month that settled a dispute between Etienne Meyers and Andie Richardson.

Meyers loaned Richardson $100,000 in 2012, on the condition that the money be repaid within 46 days after September 30. The interest Meyers charged for the 46 days is 15 percent – which amounts to an extortionate annual interest of 119 percent.

Richardson borrowed the money in 2012 but he did not pay it back. The court ruled that he should have paid back already in November 2012 and ruled in favor of Meyer’s demand that he pay back this money.

The court considered the interest Meyers wanted as usurious (excessive), “especially since it has not been established that professional parties dealt with each other.”

The court set the limit at 18 percent for a whole year and ruled that based on this percentage, Richardson is liable for $2,268.49.

The court sentenced Richardson to repay Meyers $102,268.49 plus legal interest from September 20, 2013, 500 guilders for collection costs, and $7,646.50 in legal costs.

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