State Supreme Court strikes down payday loan company’s “self-serving” arbitration provision

The decision could have national implications on contract disputes.

The decision makes such one-sided mandatory arbitration clauses unenforceable and illegal in New Mexico, Attorney General Gary King said today, a day after the state’s highest court handed down its decision against World Finance Corp. of New Mexico in favor of Las Vegas, N.M., social worker Laura Cordova.
The case stems from a lawsuit Cordova filed in September 2006 against World Finance that accused the short-term lender of unreasonable debt collection and violating the Unfair Practices Act.
Cordova said she was besieged by the company by nearly three years of increasingly threatening, frequent and demanding phone calls to her office, her home, her relatives and her boss when she could not pay back her loans — at a 110 percent annual interest rate — after she fell ill.
The company challenged her right to a jury trial by invoking a clause in her contract that forced her into mandatory arbitration — a private dispute resolution system that bypasses the courts — overseen by an entity of the company’s own choosing.
Such clauses are prevalent in numerous contracts consumers often unwittingly enter into when they sign up for a credit card, cell phone, loans, medical care or a job.
Read more about this story in tomorrow’s Journal.

Share Your Story

Nativo Sponsored Content

taboola desktop

MORE ARTICLES LIKE THIS

1
Could stadium money go to police instead?
ABQnews Seeker
Bond allocation could move to the ... Bond allocation could move to the city's general fund
2
UPDATE: APD says missing 4-year old found safe
ABQnews Seeker
Albuquerque police say they are no ... Albuquerque police say they are no longer looking for Catiana Zepeda, the 4-year-old whose mother was found dead on Friday in an apartment in ...
3
Bernalillo County won't require worker shots
ABQnews Seeker
Concerns public safety workers resistent to ... Concerns public safety workers resistent to COVID vaccine might retire early
4
New map may see Rio Rancho, West Side add ...
ABQnews Seeker
Sandoval County's population jumped 13.1% in ... Sandoval County's population jumped 13.1% in 2020 census
5
In NM, helping to prevent suicide remains a task ...
Blogs
Ours is still a state that ... Ours is still a state that is sorely lacking in mental health care providers
6
Vaccination rate in NM inches close to 70%
ABQnews Seeker
State reports 13 deaths, 762 new ... State reports 13 deaths, 762 new cases
7
At Kirtland AFB, a scramble to enact vaccine policy
ABQnews Seeker
Details still being worked out Details still being worked out
8
Man charged in 10 West Side armed robberies
ABQnews Seeker
The 21-year-old, who admits he takes ... The 21-year-old, who admits he takes drugs, has been arrested multiple times since 2019
9
US panel backs COVID-19 boosters only for seniors, high-risk
Nation
Dealing the White House a stinging ... Dealing the White House a stinging setback, a government advisory panel overwhelmingly rejected a plan Friday to give Pfizer COVID-19 booster shots across the ...
10
Man accused of sexually assaulting girls during sleepover
ABQnews Seeker
One girl told deputies that the ... One girl told deputies that the abuse made her feel 'sad and scared'