Justia Contracts Opinion Summaries

Douglass Sloan provided a $60,000 short-term loan to Carlos Allen for property rehabilitation, with a 60-day term and a 20% fixed return rate. If unpaid within 60 days, the loan accrued an additional 2% every subsequent 60 days. The loan was subject to the maximum interest rate allowed by D.C. law if not repaid within 60 days. Sloan sought to collect the debt, leading to a dispute over whether the loan's interest rate was usurious, as D.C. law caps interest rates at 24% per annum.The Superior Court of the District of Columbia initially ruled that Allen had waived his usury defense by not raising it for nearly seven years. The court awarded Sloan $256,946.46 plus $97,450 in attorney’s fees and costs. On appeal, the District of Columbia Court of Appeals upheld the attorney’s fees but remanded the case for reconsideration of the usury defense waiver. The trial court then found no substantial prejudice to Sloan from Allen’s delay and ruled the loan usurious, reducing the award to $39,026.46, the remaining principal, plus the affirmed attorney’s fees.The District of Columbia Court of Appeals reviewed the case again. It upheld the trial court’s findings that Allen had not waived his usury defense and that the loan was usurious, as it effectively charged a 34.7% interest rate in its first year. The court rejected Sloan’s arguments against these findings but agreed that Sloan was entitled to post-judgment interest on the award from the date of the initial October 2020 judgment. The court also dismissed Allen’s cross-appeal, which challenged the validity of the loan and the attorney’s fees, as these issues had been resolved in a prior decision. The case was remanded for the imposition of post-judgment interest on the $39,026.46 award. View "Sloan v. Allen" on Justia Law