The Plenary of the First Chamber of the Supreme Court has ruled in favor of the bank with the interest rates of the ‘revolving’ cards. The High Court has dismissed an appeal against a sentence in which the interest of 23.9% APR agreed in a ‘revolving’ contract was declared non-usurious and has established the criterion that the interest is “significantly higher” if the difference between the average market and agreed rate exceeds 6 percentage points, according to the sentence to which Europa Press has agreed.
The recurring subscription on May 3, 2004 of a Visa credit card contract, ‘revolving’ modality, with the entity Barclays Bank and with a remunerative interest of 23.9% TAE. The financial entity assigned its credit to Estrella Receible and later sued the cardholder claiming the amount owed. The Court of First Instance number 3 of Huelva dismissed the claim and declared the usurious nature of the agreed interest because it was “significantly higher” than the average interest on consumer loans.
Subsequently, the Provincial Court of Huelva upheld the appeal in part. Thus, it rejected the suitability of the average rates of consumer loans to make the comparison as it is a credit card, and believed that the usual interest in this type of contract in 2012 was 20.90% or higher.
However, the remunerative interest was not expected to be usurious because it was not notoriously higher than that normally agreed and discounted some amounts for commissions for claims of unpaid installments. Against this decision, the defendant filed an appeal, which has now been dismissed by the Supreme Court.
The High Court reiterates that the index that must be taken into consideration to determine if the agreed interest is higher than normal is the equivalent annual rate (TAE) must be compared with the average interest applicable at the time of contracting to the corresponding category. to the disputed operation. For contracts signed after the Bank of Spain statistical bulletin broke down the type of revolving credit since June 2010, the comparison parameter is the average interest rate published at each time.
The published interest is slightly lower than the APR
The Chamber warns that the interest rate analyzed by the Bank of Spain in the statistical bulletin is the TEDR (restricted definition effective rate) which is equivalent to the APR without commissions. For this reason, the Supreme Court indicates that the published interest is slightly lower than the APR and can be supplemented with the commissions generally applied by financial institutions. For the court, this difference between the TEDR and the TAE is not very decisive to assess usury because it is required that the agreed interest is certainly higher than the normal market rate, that is, it is not enough that it is merely higher.
In this case, the focus is on determining what the normal market interest rate was for revolving in 2004, a time when there were no detailed statistics from the Bank of Spain. The Supreme Court points out that, to identify this normal interest, as a general rule, the specific information closest in time must be used, which is that broken down by the Bank of Spain in 2010.
“In general, for the prosecution of these cases of credit cards contracted in the first decade of this century, the specific information closest in time must be used. This is the one that was offered in 2010. According to the statistical bulletin ( of the Bank of Spain), the average TEDR rate that year was 19.32%, so we can start as a guide from the 2010 index (19.32%), with the appropriate destruction to adapt it to the APR”, explains the court.
On the other hand, it also studies the legal criterion on the acceptable upper margin in order not to incur usury in the face of predictability requirements in a context of mass litigation. In this sense, the court has established that in revolving -whose average interest has so far been above 15%-, the interest is “significantly higher” if the difference between the average market rate and the agreement exceeds six percentage points.
In the specific case studied by the court, the average rate at the time of contracting was “slightly higher” than 20% and the agreed interest (23.9% APR) does not exceed six points, so the Supreme Court does not consider the interest ” clearly superior” or usurious and, consequently, dismisses the appeal.