This opinion will be unpublished and

may not be cited except as provided by

Minn. Stat. § 480A.08, subd. 3 (2000).






Esther Walker, et al.,





Fingerhut Corporation,



Filed May 15, 2001

Affirmed; Motion denied

Kalitowski, Judge


Hennepin County District Court

File No. 9713744


Susan Ford Bedor, William H. Crowder, Gregory L. Paulson, Crowder & Bedor, 555 West Seventh Street, #201, St. Paul, MN 55102; and


Seymour J. Mansfield, Richard J. Fuller, Mansfield, Tanick & Cohen, P.A., 900 Second Avenue South, #1560, Minneapolis, MN 55402-3383; and


Charles H. Johnson, Charles H. Johnson & Associates, 2599 Mississippi Street, New Brighton, MN 55112 (for appellants)


Edward M. Laine, Christopher M. Scotti, Bridget A. Sullivan, Oppenheimer Wolff & Donnelly LLP, 3400 Plaza VII Building, 45 South Seventh Street, Minneapolis, MN 55402 (for respondent)


            Considered and decided by Stoneburner, Presiding Judge, Kalitowski, Judge, and Schumacher, Judge.

U N P U B L I S H E D   O P I N I O N


            Following a remand from this court, appellants challenge the district court’s determination that respondent Fingerhut Corporation made a good-faith attempt to comply with the Minnesota usury law.  We affirm.  


            On an appeal from a grant of summary judgment, this court must determine whether there are any genuine issues of material fact and whether the district court erred in its application of the law.  State by Cooper v. French, 460 N.W.2d 2, 4 (Minn. 1990).  We “view the evidence in the light most favorable to the party against whom judgment was granted.”  Fabio v. Bellomo, 504 N.W.2d 758, 761 (Minn. 1993) (citation omitted).  A reviewing court is not bound by and need not give deference to the district court’s decision on a purely legal issue.  Frost-Benco Elec. Ass’n v. Minnesota Pub. Utils. Comm’n, 358 N.W.2d 639, 642 (Minn. 1984).

            Appellants argue that in granting summary judgment in favor of respondent the district court failed to follow this court’s prior opinion because respondent did not present evidence that it took reasonable precautions to comply with Minnesota usury law.  We disagree.

            “Minnesota follows the general rule that usury is the taking or receiving of more interest or profit on a loan” of money or forbearance of indebtedness than the law allows.  St. Paul Bank for Coops. v. Ohman, 402 N.W.2d 235, 237 (Minn. App. 1987) (citation omitted).  To conclude that a usurious rate has been charged, a court must find

(a) A loan of money or forbearance of a debt; (b) an agreement between the parties that the principal shall be repayable absolutely; (c) the exaction of a greater amount of interest or profit than is allowed by law; and (d) the presence of an intention to evade the law at the inception of the transaction.


Rathbun v. W.T. Grant Co., 300 Minn. 223, 230, 219 N.W.2d 641, 646 (1974) (citation omitted).  But no intention to evade the usury law is established if respondent shows it took reasonable precautions to comply with the usury law.  See Trapp v. Hancuh, 530 N.W.2d 879, 886 (Minn. App. 1995); Wetsel v. Guaranteed Mortgage Co., 195 Minn. 509, 512, 263 N.W. 605, 606 (1935) (“[W]here a transaction is entered into in good faith, with no purpose to evade the usury laws, it will be upheld.”).  Whether good faith is shown is a fact question for the district court to resolve.  Barry v. Paranto, 97 Minn. 265, 268, 106 N.W. 911, 912 (Minn. 1906).

            Here, respondent submitted affidavits explaining its actions to comply with the usury laws in the so-called Special States.  Respondent concluded that

Minnesota law does not apply to certain terms of its contracts in “Special States” that have laws specifically regulating annual percentage rates and the customer’s right to a refund in the event of prepayment.  [Respondent] complies with the laws of each of the Special States on the issues of finance rates and refunds for prepayment.


Because respondent believed the Special States’ rebating laws applied to purchases made in the Special States, it developed computer software to comply with those requirements.  Moreover, by complying with those requirements respondent received less compensation then it would have received under Minnesota law, which does not require refunding finance charges when a customer prepays.  Based on this evidence, we cannot say the district court erred in determining that respondent’s good-faith belief that Minnesota law was not controlling in the Special States established that respondent had no intention to evade Minnesota usury law.  See Washington Fed. Sav. & Loan Ass’n v. Baker, 374 N.W.2d 786 (Minn. App. 1985) (finding of good-faith attempt to comply with Minnesota usury law by party that believed the transaction was not governed by Minnesota law), review denied (Minn. Dec. 13, 1985).

Appellants contend respondent’s affidavits were conclusory and lacked foundation and thus failed to establish good-faith compliance with Minnesota usury law.  But it is undisputed that respondent received less compensation by rebating in the Special States and suffered additional expense in creating computer software to comply with the rebate requirements.  Moreover, no evidence was presented concerning any legitimate business purpose that would motivate respondent to comply with the rebate laws in the Special States absent its good-faith belief that Minnesota usury law did not apply to those transactions. 

Finally, appellants made a motion to strike arguments from respondent’s brief based on the doctrine of Law of the Case.  We deny appellants’ motion because we conclude that the arguments at issue are relevant to the issue of whether respondent was acting in good faith in attempting to comply with the usury law.

Affirmed; motion denied.