TRENTON—Today
the NJ Supreme Court vindicated what consumer advocates have contended
for a long time: the Rent-to-Own industry is not above the law, and has
no right to charge its customers—largely the urban poor—interest in
excess of 80% a year. Instead, Rent-to-Own must charge its customers no
more than 30% interest, the maximum legal interest rate in New Jersey
for these types of transactions.
“This
decision is a complete and total victory for consumers,” said Abigail
Caplovitz, Legislative Advocate for the New Jersey Public Interest
Research Group. “Now the Rent-to-Own industry will have to stop
flagrantly violating New Jersey’s interest rate cap.”
“The
New Jersey Supreme Court has restored fundamental fairness to the sale
of goods in New Jersey,” said Neil Fogarty of Consumers League of New
Jersey. “The urban poor should not be charged 80% or 100% while the
middle class pays only 20% at the mall."
Applying
conventional techniques of statutory interpretation, the Court held
that three fundamental consumer protection laws apply to rent-to-own
transactions. “We are grateful the Court recognized that these laws
protect Hilda Perez and rent-to-own consumers like her, just like they
protect other people who buy goods over time,” said Seth Lesser, one of
the attorneys representing the plaintiff, Hilda Perez.
“Now
the trial court will have to figure out how many people, like Hilda,
are entitled to refunds of the excessive interest the Rent-to-Own
industry overcharged them,” added Mark Cuker another of the attorneys
representing Hilda.
“Rent-to-Own
customers can now take heart,” added Bill Riback, another of Hilda’s
attorneys, “the New Jersey Supreme Court has stood up for them.”
“Today’s
decision vindicates the Legislature’s multiple rejections of efforts to
pass special rules for the industry,” added Caplovitz, “the laws they
passed a few decades ago continue to work beautifully for consumers.”
