Htaike v. Sein

If there is no statutory basis to bring an action to recover usurious interests paid, equitable relief may be available.

Htaike filed an action seeking $200,000 on the general theory that Sein had secured a series of promissory notes at exorbitant interest rates from Htaike through loansharking. Sein pressured Htaike about the repayment terms, and had threatened Htaike with jail for failing to pay. Sein also failed to provide Htaike with an accurate accounting of how much they owned at any given time. The trial court had granted summary judgment for Sein on one claim, and after trial, found for Htaike on the remaining claims. Sein challenged the trial court’s ruling that the usury statute did not preclude Htaike’s claims. The Court concluded that the existence of a statute that provides borrowers a defense from the collection of interest on usurious loans does not, as Sein claimed, preclude the claims that Htaike brought in this case. Further, Sein asserted that because Htaike’s rationale for recovery was Sein’s fraudulent conduct, the claims sounded in tort and the statute of limitations for torts should apply, as opposed to the longer statutory period for contract claims. The Court agreed that the statute for torts applied, finding that a reasonable factfinder would not necessarily find that Htaike knew or should have known about the harm from Sein at a point in time that would trigger the statute for this case. Sein maintained that the trial court abused its discretion when it allowed Htaike to amend his complaint after trial to allege a new basis for attorney’s fees. The Court found that ORCP 23 requires that leave to amend be freely given when justice requires. Lastly, Htaike on cross-appeal alleged that the trial court erred when it ignored the “last predicate act” exception to the statute of limitations for an action under ORICO. The Court found that the trial court did err in that action. Affirmed on appeal; reversed and remanded on cross-appeal.