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KANSAS COMMENT, 2010

1. The transitional provisions set forth in this section were extremely important for ongoing customer transactions entered into before the effective date of the U3C, January 1, 1974, because certain transactions entered into before that date may well have fallen within the ambit of the U3C. For example, a note executed in 1973 containing a balloon payment scheduled to be due after January 1, 1974 would have been covered as a "refinancing" under subsection (3)(a) and the refinancing would have been required to take place under the limitations imposed by K.S.A. 16a-3-308. Similarly, under subsection (3)(c), a $750 installment sales contract entered into during 1973 would have been subject to the U3C's restrictions on deficiency judgments (K.S.A. 16a-5-103) if judgment was sought after January 1, 1974. On the other hand, a clause in a 1973 installment sales contract giving the seller a security interest in property unrelated to the sale would have been valid, even though such a security interest in a contract executed after January 1, 1974 would be invalid under K.S.A. 16a-3-301. Today, these considerations are largely academic, since it is unlikely that any consumer credit contracts executed before 1974 are still around.

2. Upon the effective date of the U3C, January 1, 1974, the following Kansas statutes were repealed: (a) the 1955 consumer loan act (former K.S.A. 16-401 to 16-426); (b) the 1958 sales finance act (former K.S.A. 16-501 to 16-514); (c) the 1969 truth in lending act (former K.S.A. 16-801 to 16-830); (d) the 1969 provisions regarding revolving credit (former K.S.A. 16-901 to 16-911); and (e) the 1969 installment loan rate provisions (former K.S.A. 16-203 and 16-206 to 16-213), although a technical amendment to K.S.A. 16-207 was made. The only part of the consumer loan act retained was a portion of K.S.A. 16-403, dealing with the office of the consumer credit commissioner. As the comment to K.S.A. 16a-1-202 indicates, the former statutes relating to pawnbrokers and insurance premium financing remain effective since these transactions are excluded from the U3C. The Kansas credit union law (K.S.A. 17-2201 to 17-2268) remains effective. Finally, it should be emphasized that the U3C does not repeal several important provisions relating to interest rates, such as K.S.A. 16-201 (stating the legal rate on unpaid accounts), K.S.A. 16-204 (judgment rate), 16-205 (relationship between contract rate and judgment rate), K.S.A. 16-207 (general usury limits), and K.S.A. 17-7105 (no usury limit when debtor is a corporation).

Revisor's Note:

* The phrase "this act" includes 16a-1-101 through 16a-9-102, 16-207, 16-403, 17-2214 and 84-9-203.