J. MILLARD TAWES, Governor                     1671

"There is some feeling in this Department that this language,
like that of the title, does not effect any change in existing law, i.e.,
it provides only for the forfeiture of interest and charges above the
legal rate of interest. However that may be, it is my feeling that the
body of the bill as amended does reflect an attempt to provide for the
forfeiture of all interest, including 'legal' interest, when usury is
found in any transaction. If this is true, the title is misleading and
runs counter to the spirit, if not the letter, of Article III, Sec. 29 of the
Constitution of Maryland, in that there is a divergence between the
title and body of the bill.

"Sec. 5 of Article 49, which House Bill 44 does not purport to
amend, provides that 'the plaintiff (i.e., the creditor) shall be entitled
to recover the sum of money ..... actually lent or advanced with legal
interest from the time the same was so lent or advanced.' If the
bill was intended to have the broad significance suggested in the
preceding paragraph, the failure to eliminate this diametrically op-
posed provision is difficult to understand.

"Of even greater practical import is the fact that the Court of
Appeals has held that a statute of this type may be applied even to
obligations in existence on the effective date of the bill. Baugher v.
Nelson, 9 Gill 299; Wilson v. Hardesty, 1 Md. Ch. 66. In other words,
legal obligations which have been in effect for many years may be
affected if this law is approved.

"The case law in Maryland on this aspect of usury, while broadly
stated, is not extensive. In addition, recent years have seen great
proliferation of charges made by lending institutions. At least some of
these are untested as to their relationship with the law of usury.

"In conclusion, let me say that there have been many grave
doubts raised as to the constitutionality of this bill; and there is no
question but that the meaning, effect and proper legal application of
this bill are shrouded with ambiguity. I certainly do not attempt to
advise you on matters of policy or question the economic philosophy
which might have motivated the introduction and passage of this bill.
However, since this bill does influence a cover a broad cross section
of the commercial and financial interests operating within this State,
I do feel that it is my obligation to point out to you its obvious short-
comings. It would further appear that the legislation presented in
this bill is the type that might well receive extensive study from the
Legislative Council, which it did not receive, and proper recommenda-
tions from that body. This is especially true, since our present laws
pertaining to usury are of 18th and 19th century vintage.

"I am always prompt to encourage any legislative action which
seeks to frustrate usurious financing. However, frankness compels
me to state that, short of obtaining a declaratory decree on this bill,
I do not believe that anyone can advise you with certainty that this
bill goes beyond the present existing laws and, therefore, is un-
necessary,, or that it goes far beyond existing laws to the extent that
it might well impair legitimate lenders."

In view of the foregoing opinion of the Attorney General, I feel
that I have no alternative than to veto the Bill.

I agree with the Attorney General that the subject matter of
this Bill deserves extensive study. As a matter of fact, in 1961 I
appointed a Commission to Study Article 49 of the Maryland Code