Justice Carolyn Demarest

Richardson sued defendants for an alleged breach of contract on alleged loans advanced to them. Defendants moved for summary judgment dismissing the complaint arguing Richardson violated New York’s usury laws. Defendants argued the repayment schedule set up on the loans would result in an interest rate in excess of 25 percent, constituting criminal usury, resulting in Richardson being barred from recovery on her claims. Richardson noted defendants proposed the interest rates and drafted the loan documents, contending they should be estopped from arguing a usury defense. The court stated where there was evidence defendants set a rate they knew to be usurious for purposes of avoiding repayment of a loan, an issue of act was raised if defendants may be estopped from raising usury as a defense to Richardson’s claims. Thus, summary judgment dismissing Richardson’s complaint based on a defense of criminal usury was denied. Also, the court noted if the transaction was not a loan, there could be no usury, stating the complaint and accompanying documents raised issues of fact if any of the monies tendered by Richardson were for investment purposes precluding summary judgment to either party.