2021 Georgia Code
Title 44 - Property
Chapter 12 - Rights in Personalty
Article 3 - Bailments
Part 5 - Pawnbrokers
§ 44-12-131. Duration of Pawn Transactions; Lease-Back of Motor Vehicles Prohibited; Taking Possession of Motor Vehicles; Restrictions on Interest, Fees, or Charges; Action to Recover Excessive or Undisclosed Charges; Consequences of Excessive Charges

1. 1. All pawn transactions shall be for 30 day periods but may be extended or continued for additional 30 day periods.
   2. A pawnbroker shall not lease back to the seller or pledgor any motor vehicle during a pawn transaction or during any extension or continuation of the pawn transaction.
   3. Unless otherwise agreed, a pawnbroker has upon default the right to take possession of the motor vehicle.In taking possession, the pawnbroker or his agent may proceed without judicial process if this can be done without breach of the peace or may proceed by action.
   4. 1. During the first 90 days of any pawn transaction or extension or continuation of the pawn transaction, a pawnbroker may charge for each 30 day period interest and pawnshop charges which together equal no more than 25 percent of the principal amount advanced, with a minimum charge of up to $10.00 per 30 day period.
      2. On any pawn transaction which is continued or extended beyond 90 days, a pawnbroker may charge for each 30 day period interest and pawnshop charges which together equal no more than 12.5 percent of the principal amount advanced, with a minimum charge of up to $5.00 per 30 day period.
      3. In addition to the charges provided for in subparagraphs (A) and (B) of this paragraph, in a pawn transaction or in any extension or continuation of a pawn transaction involving a motor vehicle or a motor vehicle certificate of title, a pawnbroker may charge the following:
         1. A fee equal to no more than any fee imposed by the appropriate state to register a lien upon a motor vehicle title, but only if the pawnbroker actually registers such a lien;
         2. No more than $5.00 per day in storage fees, but only if an actual repossession pursuant to a default takes place on a vehicle which was not already in the pawnbroker's possession and only for each day the pawnbroker must actually retain possession of the motor vehicle; and
         3. A repossession fee of $50.00 within 50 miles of the office where the pawn originated, $100.00 within 51 to 100 miles, $150.00 within 101 to 300 miles and a fee of $250.00 beyond 300 miles, but only if an actual repossession pursuant to a default takes place on a vehicle which was not already in the pawnbroker's possession.
      4. If a pledgor or seller requests that the pawnbroker mail or ship the pledged item to the pledgor or seller, a pawnbroker may charge a fee for the actual shipping and mailing costs, plus a handling fee equal to not more than 50 percent of the actual shipping and mailing costs.
      5. In the event the pledgor or seller has lost or destroyed the original pawn ticket, a pawnbroker may, at the time of redemption, charge a fee equal to not more than $2.00.
   5. No other charge or fee of any kind by whatever name denominated, including but not limited to any other storage fee for a motor vehicle, shall be made by a pawnbroker except as set out in paragraph (4) of this subsection.
   6. No fee or charge provided for in this Code section may be imposed unless a disclosure regarding that fee or charge has been properly made as provided for in Code Section 44-12-138.
   7. 1. Any interest, fees, or charges collected which are undisclosed, improperly disclosed, or in excess of that allowed by this subsection may be recovered by the pledgor or seller in an action at law in any superior court of appropriate jurisdiction.
      2. In any such action in which the pledgor or seller prevails, the court shall also award reasonable attorneys' fees, court costs, and any expenses of litigation to the pledgor or seller.
      3. Before filing an action under this Code section, the pledgor or seller shall provide the pawnbroker with a written notice by certified mail or statutory overnight delivery, return receipt requested, that such an action is contemplated, identifying any fees or charges which the pledgor or seller contends are undisclosed, improperly disclosed, or in excess of the fees and charges allowed by this Code section.If the court finds that during the 30 days following receipt of this notice the pawnbroker made a good faith offer to return any excess, undisclosed, or improperly disclosed charges, the court shall award reasonable attorneys' fees, court costs, and expenses of litigation to the pawnbroker.
      4. No action shall be brought under this Code section more than two years after the pledgor or seller knew or should have known of the excess, undisclosed, or improperly disclosed charges.
2. Any interest, charge, or fees contracted for or received, directly or indirectly, in excess of the amounts permitted under subsection (a) of this Code section shall be uncollectable and the pawn transaction shall be void. All interest and the pawnshop charge allowed under subsection (a) of this Code section shall be deemed earned, due, and owing as of the date of the pawn transaction and a like sum shall be deemed earned, due, and owing on the same day of the succeeding month.

(Code 1933, § 12-612, enacted by Ga. L. 1945, p. 189, § 1; Ga. L. 1989, p. 819, § 2; Ga. L. 1992, p. 3245, § 3; Ga. L. 2000, p. 1589, § 3.)

The 2000 amendment, effective July 1, 2000, and applicable with respect to notices delivered on or after July 1, 2000, substituted "certified mail or statutory overnight delivery" for "certified mail" in the first sentence of subparagraph (a)(7)(C).

- Criminal penalty for excessive interest, § 7-4-18.

- For note discussing transfer fees in home loan assumptions in reference to the Georgia usury laws, see 9 Ga. L. Rev. 454 (1975). For note on 1992 amendment of this Code section, see 9 Ga. St. U.L. Rev. 323 (1992).

The terms "interest" and "pawnshop charges" are not synonymous or interchangeable, and both terms must be recognized as having individual importance within O.C.G.A. § 44-12-131. Fryer v. Easy Money Title Pawn, Inc., 183 Bankr. 654 (Bankr. S.D. Ga. 1995).

Construed with § 7-4-18. - There is no conflict between O.C.G.A. §§ 7-4-18 and44-12-131 since what is authorized by the pawnshop statute is a combination of charges up to 25% per month, not the imposition of interest alone at a rate of 25% per month. Fryer v. Easy Money Title Pawn, Inc., 183 Bankr. 654 (Bankr. S.D. Ga. 1995).

O.C.G.A. § 44-12-131, not O.C.G.A. § 7-4-18, the criminal usury statute, governs pawnshop transactions. Glinton v. And R, Inc., 271 Ga. 864, 524 S.E.2d 481 (1999).

O.C.G.A. §§ 7-4-18 and44-12-131, the criminal usury statute, are in conflict and cannot be reconciled. Hooks v. Cobb Ctr. Pawn & Jewelry Brokers, Inc., 241 Ga. App. 305, 527 S.E.2d 566 (1999).

The amount of interest on a pawn transaction was regulated by O.C.G.A. § 44-12-131 and was not governed by the five percent limit imposed on general loans by the usury statute, O.C.G.A. § 7-4-18. Hooks v. Cobb Ctr. Pawn & Jewelry Brokers, Inc., 241 Ga. App. 305, 527 S.E.2d 566 (1999).

Construction with §§ 44-12-130 and 44-12-137. - In resolving a statutory conflict between O.C.G.A. §§ 44-12-130(1) and44-12-137(a)(7) with respect to the one-month duration for a pawn transaction and O.C.G.A. § 44-12-131(a)(1) which required a duration of 30 days, it was determined that the criminal penalty in § 44-12-137(a)(7) was inapplicable to a customer's pawn transaction that satisfied the 30-day requirement of § 44-12-131(a)(1); the customer's action against the pawnbroker based on an illegal duration accordingly failed. Marshall v. Speedee Cash, 292 Ga. App. 790, 665 S.E.2d 888 (2008).

Pawnshop charges are expenses actually incurred by the pawnbroker in providing a service in connection with the transaction. Fryer v. Easy Money Title Pawn, Inc., 183 Bankr. 322 (Bankr. S.D. Ga. 1995).

- Pawnshop charge which included a 23% service charge for the customers use of the pawned automobile, the risk to the lender of that continued use, checking and processing the title to the automobile apparently in addition to an itemized title fee charged under the contract, verifying insurance on the automobile and making a log for the sheriff's department, constituted interest rather than pawnshop charges since it did not reimburse specific expenses actually incurred by the pawnbroker. Fryer v. Easy Money Title Pawn, Inc., 183 Bankr. 322 (Bankr. S.D. Ga. 1995).

- In single advance, single payment transactions in which the term is less than a year and equal to a whole number of months, pawnbroker-creditors may make the unit period determination in the alternative, that is, on the basis of the term as a number of months or on the basis of the term as a number of days. Hooks v. Cobb Ctr. Pawn & Jewelry Brokers, Inc., 241 Ga. App. 305, 527 S.E.2d 566 (1999).

- Although O.C.G.A. §§ 44-12-130(5) and44-12-131(a)(3) grant the pawnbroker the right to self-help repossession upon default without the necessity of filing a lien, this remedy is intended to apply to the defaulting pledgor, not a bona fide purchaser for value with no notice of the pawnbroker's claim. Cobb Ctr. Pawn & Jewelry Brokers, Inc. v. Gordon, 242 Ga. App. 73, 529 S.E.2d 138 (2000).

- Bankruptcy court found that the creditor was not entitled to summary judgment regarding the debtor's repossessed vehicle action where the pawnshop agreement in issue violated the statutory requirements for automobile title pawns under Georgia law, O.C.G.A. § 44-14-130. Johnson v. Speedee Cash of Columbus, Inc. (In re Johnson), 289 Bankr. 251 (Bankr. M.D. Ga. 2002).

LLC that seized a Chapter 13 debtor's car 16 hours before the debtor declared bankruptcy, and sold the car without keeping records, was ordered to pay the debtor $6,579.57 for loss of the car, $300 for lost personal property that was in the car, $2,356.70 in emotional distress damages, and reasonable attorney's fees, pursuant to 11 U.S.C. § 362(k), because the evidence showed that the LLC knew the debtor declared bankruptcy before the LLC sold the car. Although the LLC claimed that the LLC was not liable under § 362 because the debtor forfeited rights in the car pursuant to the Georgia Pawnshop Act (GPA), O.C.G.A. § 44-14-403, when the debtor failed to repay a debt, the court rejected that argument because the LLC assessed interest rates over the course of the contract that exceeded the rates allowed by the GPA, such that a Motor Vehicle Pawn Contract the debtor signed was void from the contract's inception pursuant to O.C.G.A. § 44-12-131. Spinner v. Cash In A Hurry, LLC (In re Spinner), 398 Bankr. 84 (Bankr. N.D. Ga. 2008).

- Pawnshop customer's action, alleging that a pawnshop failed to disclose all of the interest and charges that it assessed against the customer and against purported class members who were similarly situated, as required by O.C.G.A. § 44-12-138(b)(6) and (8), failed upon a finding that the pawnshop had made a good faith offer to avoid litigation by tendering to the customer a check in the amount collected beyond the principal, as required by O.C.G.A. § 44-12-131(a)(7)(A); accordingly, the court found that the customer had not sufficiently complied with the ante litem notice provisions with respect to the other members of the class, who were not sufficiently identified in order to allow a good faith offer to be made to them. Mack v. Ga. Auto Pawn, Inc., 262 Ga. App. 277, 585 S.E.2d 661 (2003).

Cited in Bell v. Instant Car Title Loans (In re Bell), 279 Bankr. 890 (Bankr. N.D. Ga. 2002); In re Chastagner, 498 Bankr. 376 (Bankr. S.D. Ga. 2013).

OPINIONS OF THE ATTORNEY GENERAL

Motor vehicle as subject of pawn transaction.

- When a motor vehicle is the subject of a pawn transaction, O.C.G.A. § 44-12-131(a) as it existed prior to the 1992 amendment authorized pawnbrokers to receive interest up to the rate of two percent per month on the principal, a pawnshop charge not limited by the "one-fourth of the principal amount" ceiling applicable to other pawn transactions, and a motor vehicle storage fee not to exceed $30.00 per day. 1989 Op. Att'y Gen. No. U89-28.

RESEARCH REFERENCES

Am. Jur. 2d.

- 53A Am. Jur. 2d, Moneylenders and Pawnbrokers, § 46 et seq.

- 70 C.J.S., Pawnbrokers, § 5.