In March of 2016, my client went shopping for a car at Champion Automotive, a used car dealership in Mobile, Alabama. They told her she was approved, and took her $2,500 as a down payment for the vehicle. Unbeknownst to her, she was not actually approved by any finance company, and instead of canceling the contract and returning her money, they chose to repossess the vehicle and keep her down payment. Their stated reason for doing this was that she had signed a Spot Delivery Agreement, which said that if she wasn’t approved, they could charge her $50.00 per day. This Spot Delivery Agreement was the only document they provided her at the time of the sale, despite the fact that state and federal law require that the buyer get a copy of the loan contract at or before the time of the sale of the vehicle.
We sued them for fraud, wrongful repossession (a form of conversion), and violation of her rights under the UCC, as well as violation of the federal Truth in Lending Act. They fought tooth and nail to get the case thrown out of court. First they tried to compel arbitration, but failed because they had previously violated the AAA Consumer Rules of Arbitration, which were part of their own contract documents.
We took their deposition and discovered that even after the repossession, they never notified her in writing of any intended disposition of the vehicle. This is clear contravention of Alabama’s UCC Article 9, which states that “a secured party that disposes of collateral under Section 7-9A-610 shall send to [the debtor] … a reasonable authenticated notification of disposition.” Furthermore, they subsequently sold the vehicle to another purchaser for more than what my client owed them. This is also illegal, pursuant to Ala. Code 7-9A-616. We moved for summary judgment on both of these grounds, and we won.
Later, we filed a second motion for summary judgment on the remaining counts of the Complaint, which we also won. On October 25, 2019, the judge issued a judgment against the dealership for $43,840.54 plus court costs.
The case was Randi Joyce v. Nexcar, LLC d.b.a. “Champion Automotive,” Docket Number 02-CV-2016-901896.