Barnett Law firm, P.A good., Mickey D. Barnett, Phillip W. Cheves, David An excellent. Garcia, Amy B. Bailey, Albuquerque, NM, Wolf and you will Fox, P.C., Amy B. Bailey, Albuquerque, NM, to possess Petitioner.

This point shall perhaps not create a beneficial waiver away from Lender’s rights after that to find specific administration of its rights less than this Contract when you look at the the big event Debtor shall insist an excellent counterclaim otherwise right out of setoff such judicial otherwise low-official step

Feferman & Warren, Richard Letter. Feferman, Robert Dale Treinen, Albuquerque, NM payday loan company California, Social Justice, P.C., F. Paul Mundane, Jr., Washington, D.C., to possess Respondent.

Doerr & Knudson, P.A., Randy J. Knudson, Portales, NM, AARP Base, Deborah Meters. Zuckerman, Washington, D.C., having Amicus Curiae AARP.

Gary K. King, Attorneys General, David K. Thomson, Secretary Lawyer Standard, Scott Fuqua, Secretary Attorney General, Santa Fe, NM, getting Amicus Curiae Place of work of one’s Attorneys General.

CHARLES W. DANIELS, Justice I Agree: EDWARD L. CH?VEZ, Master Justice, PATRICIO M. SERNA, Fairness, PETRA JIMENEZ MAES, Fairness, RICHARD C. BOSSON, Fairness.

<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 Agreement and you can people prior or then mortgage off Financial and you will any earlier in the day otherwise after that shopping cost conversion process package made out of/or assigned to Financial in addition to most of the records according to same and you will insurance available in contact with your order;

? people allege reliant a federal or condition law plus, yet not simply for, the outcome-in-financing Operate and you may Regulation Z; the fresh Equivalent Borrowing from the bank Options Act and Controls B, county insurance coverage guidelines, state usury and you will financing laws also condition individual defense laws and you can regulations;

Although we disagree somewhat in our legal data, we affirm the decision of one’s Court out-of Is attractive and you will keep your section court is best for the denying the borrowed funds company’s motion so you’re able to compel arbitration of one’s borrower’s official states

? one argument about closing, repair, event otherwise implementing the mortgage Contract or other financing or merchandising payment sales preparations anywhere between Financial and you can 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 this Arrangement, in the eventuality of a default under the Mortgage Agreement, Bank get look for their cures in the a task at the laws or for the collateral, also yet not limited to, official foreclosures or repossession. Bank may exercise their most other remedies provided with legislation (such as for example, however restricted to, the best from care about-assist repossession significantly less than Article 9 of your own Uniform Industrial Password otherwise almost every other appropriate laws and you will/or the foreclosure energy regarding deals).