Book Opener

The worker was told to remove papers that would be helpful inthe mayor’s reelection campaign. The mayor agreed to pay thecampaign worker a large sum of money and to protect the workerfrom criminal charges if he were caught. The agreement wasillegal and void. The mayor and the campaign worker would bothbe criminally liable for their illegal acts.Usury StatutesEach state sets a maximum interest rate that lenders can charge forloans by statute. Interest is the fee the borrower pays to the lender forusing the money. The interest rate the lender and borrower agree uponmust not exceed the maximum rate allowed by state law. Charging morethan the maximum legal interest rate is usury .Example 5. Linda Chavez wants to buy a car when she turns 18.To make the down payment, Linda borrows $600 from RobertLightner. Linda promises to pay Lightner $100 per month for 12months—a total payout of $1,200 for the use of $600. The lawwould not require Linda to pay the full $1,200. She has promisedto pay a higher rate of interest than the law permits. The bargainis illegal, and the courts would not enforce it.The Truth in Lending Act is one step the federal government hastaken to make consumers aware of the cost of borrowing money. Undersuch legislation, the lender must clearly convey the annual percentagerate (APR) on each loan to the borrower. Before you sign any loan agreement,be sure to look for a statement of the true rate of interest.Gambling StatutesState statutes also prohibit gambling agreements. Gambling agreementsare those in which one party wins and another party loses, evenif some skill may be involved. Gambling agreements may include playingcards for money, money wagers or bets on elections or sportsevents, or buying tickets in a sports pool. Giveaway games by storesor businesses for promotion are legal as long as you are not requiredto buy a ticket or product to participate. Casual gamblers may not enforcetheir gambling agreements in court because they are performingan illegal act.Politically CorrectVolunteering to workon a political campaignis one way to becomeinvolved in politics.Ideally, a politicalcampaign should beorganized, enthusiastic,and ethical. Unfortunately,some campaignsuse unethical andillegal tactics to gainvoter support. Libelis one of the mostcommon unethicaltactics used by politicians.Do you thinkit is ever justified tospread false ormisleading rumorsabout a politicalopponent?Get InvolvedBecome politicallyinvolved at school byjoining your studentcouncil or by runningfor class president.Volunteer to work on alocal, state, or nationalpolitical campaign inyour area.Example 6. Emil and Rita live in a state where gambling agreementsare illegal. They made a $200 bet on the World Series.When Emil won the bet, Rita refused to pay the $200. Emil thenthreatened to sue Rita in small claims court. Because the bet wasillegal, Emil could not collect from Rita.Chapter 9: Legality 189