The Honorable Jay Bradford State Senator P.O. Box 8367 Pine Bluff, Arkansas 71611
Dear Senator Bradford:
This official Attorney General opinion is rendered in response to your question regarding Arkansas' usury laws. You have asked:
Does the Arkansas usury law apply to contracts of auto leases originated in the State of Arkansas?
I assume that your question refers to multi-state contracts — i.e., contracts involving a party located within the State of Arkansas, and a party located outside the State of Arkansas. The answer to this question will depend upon certain facts of which I have not been apprised. Indeed, the question of the applicability of the usury law to particular multi-state contracts must always be determined on a case by case basis.1 For this reason, it is difficult to formulate general rules of applicability that are conclusive to any degree. I am therefore unable to offer a definitive response to your question.
Nevertheless, this office has previously issued an opinion (Op. Att'y Gen. No. 93-192) in which we discussed in a summary fashion the general principles under which the applicability of the usury law to particular multi-state contracts is determined. I have attached a copy of that opinion for your review. The principles discussed therein should serve as a general guideline by which you can evaluate any particular contracts about which you are concerned.
The foregoing opinion, which I hereby approve, was prepared by Assistant Attorney General Suzanne Antley.
Sincerely,
WINSTON BRYANT Attorney General
WB:SBA/cyh
1 The question of whether Arkansas' usury laws apply to particular multi-state transactions requires consideration of such factual matters as whether the documents in question recite that the law of a state other than Arkansas is to govern; whether payments are to be made at an address within or outside Arkansas; whether the obligations are routinely sold to an investor within or outside Arkansas; and the status of the out-of-state party. See Wiseman v. State Bank Trust, N.A.,313 Ark. 289, 854 S.W.2d 725 (1993).