Printable Format16a-1-108. (UCCC) Effect of act on powers of organization. (1) K.S.A. 16a-1-101 et seq., and amendments thereto, prescribes maximum charges for all creditors, except lessors and those excluded by K.S.A. 16a-1-202, and amendments thereto, extends consumer credit including consumer credit sales and consumer loans, and displaces existing limitations on the powers of those creditors based on maximum charges.
(2) With respect to sellers of goods or services, licensed lenders, consumer and sales finance companies, industrial banks, loan companies, commercial banks and trust companies, this act displaces existing limitations on their powers based solely on amount or duration of credit.
(3) Except as provided in subsection (1) and K.S.A. 16a-1-101 et seq., and amendments thereto, does not displace limitations on powers of credit unions, savings banks, savings and loan associations or other thrift institutions.
(4) Except as provided in K.S.A. 16a-1-101 et seq., and amendments thereto, does not displace:
(a) Limitations on powers of supervised financial organizations with respect to the amount of a loan to a borrower or other similar restrictions designed to protect deposits; or
(b) limitations on powers an organization is authorized to exercise under the laws of this state or the United States.
History: L. 1973, ch. 85, § 7; L. 1981, ch. 93, § 3; L. 1993, ch. 200, § 2; L. 1999, ch. 107, § 6; L. 2024, ch. 6, § 33; January 1, 2025.
KANSAS COMMENT, 2000
1. This section states the policy of the U3C regarding the displacement of laws regulating suppliers of consumer credit. The U3C displaces many existing usury laws; in addition, subsection (1) displaces existing limitations on maximum charges for all suppliers of consumer credit except lessors and those excluded under K.S.A. 16a-1-202. In other respects, the U3C differentiates among creditors depending on their status as either being sellers or lenders; and among lenders as either being or not being supervised financial organizations as defined in K.S.A. 16a-1-301(44); and finally among supervised financial organizations depending on whether they are (1) commercial or industrial banks or trust companies, or (2) thrift institutions such as credit unions, savings banks and savings and loan associations whether mutual or not.
2. Subsection (2) frees commercial and industrial banks and trust companies and all creditors other than thrift institutions from existing limitations on their powers based solely on the amount or duration of credit they may extend.
3. Subsection (3) retains all existing limitations on powers of thrift institutions, other than those based on maximum charges, on the theory that those limitations may be required for the protection of their depositors or shareholders. Similarly, subsection (4) retains limits on the powers of supervised financial organizations such as loans-to-one-borrower limits, maximum loan-to-value ratios and the like that are designed to protect deposits.
CASE ANNOTATIONS
1. Public utilities are specifically excluded from application of this section. Jones v. Kansas Gas and Electric Co., 222 Kan. 390, 398, 565 P.2d 597 (1977).