Forbearance Fees Do Not Violate Usury Law.

A debtor entered into a series of agreements in which he sought to delay enforcement of judgments. The creditor agreed not to enforce the judgments prior to a certain date in exchange for certain promises as well as the payment of a surcharge of $500 per day for each day the judgments were not paid after that date. When the judgment was not satisfied, the debtor filed the present action for money had and received and sought treble damages for alleged usury. The appellate court stated: “We conclude the forbearance fees do not violate California’s usury law. Usury liability is wholly a creature of statute. Because the usury law does not expressly prohibit a party from entering into an agreement to forbear collecting on a judgment, usury liability does not extend to judgment creditors who receive remuneration beyond the statutory 10 percent interest rate in exchange for a delay in enforcing a judgment.” (Bisno v. Kahn (Cal. App. First Dist., Div. 3; April 25, 2014) 225 Cal.App.4th 1087, [170 Cal.Rptr.3d 709].)