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Commercial Reasonableness

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District Court (MI) Says 10-month Period Between Repossession of Vehicle and Disposition Did Not Violate the UCC Where Customer Had No Evidence of Commercial Unreasonableness

by Scott J. Hyman |

In Breckenridge v. Nissan Motor Acceptance Corp., No. 18-10787, 2019 U.S. Dist. LEXIS 70049, at *11-12 (E.D. Mich. Apr. 25, 2019), Judge Hood granted summary judgment to an automobile finance company as to a debtor's claim that the passage of time from repossession to sale violated the UCC. Nissan states that Plaintiffs have not produced any evidence that the Altima… Read More

Court of Appeals (Tex.) Affirms Jury’s Disbelief that Auto Finance Company Disposed of Repossessed Aston Martin, Originally Purchased for $233,305, in a Commercially Reasonable Manner

by Scott J. Hyman |

In SunTrust Bank v. Monroe, 2018 WL 651198, at *14 (Tex.App.-Fort Worth, 2018), the Texas Court of Appeals affirmed a jury's finding that an auto finance company did not dispose of a repossessed vehicle in a commercially reasonable fashion. The jury here was instructed that every aspect of the disposition—method, manner, time, place, and other terms—had to be commercially reasonable, see Tex.… Read More

District Court (Miss.) Says Cross-Collateralization Clause in Vehicle Loan Documents Means that the Sale of All of the Repossessed Vehicles Must Be Completed Before SofL Accrues; Finds Sale of Collateral to be Commercially Reasonable

by Scott J. Hyman |

In Volvo Financial Services, Inc. v. Williamson, 2017 WL 4708136, at *3 (S.D.Miss., 2017), Judge Guirola held that the statute of limitations on a promissory note secured by a number of tractors did not accrue until all of the repossessed collateral was sold, due to a cross-collateralization clause in the note. The most reasonable interpretation of the statute when applied… Read More

Court of Appeals (Tenn.) Says Delay in Repossession of Collateral Does Not Run Afoul of UCC’s Commercially Reasonable Disposition Requirement Because Secured Creditor Need Act Commercially Reasonably Only After It Obtains Possession

by Scott J. Hyman |

In WM Capital Partners, LLC. v. Thornton, 2016 WL 7477738, at *3–6 (Tenn.Ct.App., 2016), the Tennessee Court of Appeals found that a secured party's delay in securing possession of the collateral -- which resulted in a lesser price realized at disposition -- was not a defense to the secured party's collection action because the UCC's commercially reasonable disposition requirement is… Read More

1st Circuit Says Question of Fact Existed Whether Disposition of Repossessed Aircraft Was Commercially Reasonable

by Scott J. Hyman |

In Harley-Davidson Credit Corp. v. Galvin, 2015 WL 8121856, at *4-7 (1st Cir. 2015), the 1st Circuit Court of Appeals reversed summary judgment for an airplane finance company, finding that sale of the repossessed airplane through a dealer might not have been commercially reasonable. Under Nevada law, a creditor may demonstrate that a sale through a dealer was “commercially reasonable”… Read More

District Court (N.H.) Overrules Debtor’s Objection that Post-repossession Sale of Collateral Did Not Fetch Enough Money

by Scott J. Hyman |

In Harley-Davidson Credit Corp. v. Galvin, 2014 WL 4384632 (D.N.H. 2014), Judge McCafferty rejected the debtor's arguments that Harley-Davidson did not fetch enough money for the aircraft that it repossessed from the debtor, and found that the debtor owed the balance. At its core, Galvin's argument is that SAS did not receive as much as it should have for the Aircraft, and… Read More

Court of Appeals (Md.) Finds $1,000 Entrance Fee to Auto Auction Transformed “Public” Sale of Repossessed Vehicles into “Private” Sale — Requiring More Detailed Post-Sale Disclosures and Accounting

by Scott J. Hyman |

In Gardner v. Ally Financial Inc., --- A.3d ----, 2013 WL 765013 (Md. 2013), the Maryland Court of Appeals held that a $1,000 admission fee transformed a ‘public’ sale into a ‘private’ sale – the latter of which required more detailed post-repossession disclosures and accounting than were provided to the consumer. The issue before us is limited to the $1,000… Read More

Court of Appeals (Mo.) Affirms Finding of Auction-Sale of Vehicle as Commercially Reasonable, Despite Some Troubling Language from the Court About the Business Records Exception to the Hearsay Rule

by Scott J. Hyman |

In Ford Motor Credit Co. LLC v. Harris, --- S.W.3d ----, 2012 WL 5464340 (Mo.App. S.D. 2012), the Missouri Court of Appeal affirmed a trial court’s finding that the sale of a vehicle at auto auction was commercially reasonable. The Court had some troubling language regarding the auto finance company’s ability to offer custodian-of-records testimony as to documents that it… Read More