![]() We conclude that the Legislature required that deficiency calculations for repossessed vehicles be determined based on the fair market value of the vehicle, but did not dictate the creditor's market choice in the first instance and left the ultimate determination of fair market value to the courts in contested cases, taking into account both creditor and debtor interests, and the means, methods, and markets used to sell the vehicle. The second and third questions then relate to the contents of the presale and postsale notices that must be sent to the debtors. The court first asks whether the fair market value of the collateral under § 20B is the fair market retail value of the collateral. Unsure of the meaning of the statute, the United States Court of Appeals for the First Circuit certified to this court three questions related to the calculation of "fair market value" under § 20B, and the notices that are required with respect to this calculation. The United States District Court for the District of Massachusetts granted summary judgment to Honda, and the plaintiff appealed. Williams then sued Honda, alleging that the fair market value of her repossessed automobile was the fair market retail value of the automobile and Honda's notices to her were insufficient under Massachusetts law because of the manner in which Honda described and calculated her deficiency. Honda then used that amount to establish the fair market value of the repossessed automobile and likewise referenced the auction sale amount in presale and postsale notices to the debtor. The price for the repossessed vehicle was determined at an auction open to licensed dealers. The plaintiff in this case, Rachel Williams, defaulted on her automobile loan, causing the defendant, American Honda Finance Corporation (Honda), to repossess and sell the vehicle that Under § 20B, a creditor who repossesses and sells a vehicle is entitled to recover from the debtor the deficiency, if any, that remains after deducting the "fair market value" of the vehicle from the debtor's unpaid balance. ![]() The primary issue presented in this case is how to establish the fair market value of a repossessed automobile pursuant to G. Rossman, for National Consumer Law Center, amicus curiae, submitted a brief. Abugheida, for American Financial Services Association, amicus curiae, submitted a brief. Mattson, of Illinois (Tracy McDevitt Waugh also present) for the defendant.įredrick S. Ryan also present) for the plaintiff.Įric S. Gants, C.J., dissenting.ĬERTIFICATION of questions of law to the Supreme Judicial Court by the United States Court of Appeals for the First Circuit. 106, is never sufficient where the deficiency is not calculated based on the fair market value of the collateral and the notice fails accurately to describe how the deficiency is calculated. This court concluded that the presale and postsale notice that is required by the Uniform Commercial Code, G. 255B, § 20B, the legislative history of the statute, and the realities of the automobile repossession market, concluded that the fair market value of collateral under the statute is not the fair market retail value of that collateral. This court, examining the plain language of G. Motor Vehicle Instalment Sales, Repossession, Notice. (5) SJC-12367 10 Appellant Williams Redacted Reply Brief.(4) SJC-12367 08 Appellee American Honda Finance Corp Brief.(3) SJC-12367 07 Amicus National Consumer Law Center Brief.(2) SJC-12367 04 Appellant Williams Redacted Brief.(1) SJC-12367 02 Amicus American Financial Services Association Brief.656 DecemJSuffolk County Present: Gants, C.J., Gaziano, Lowy, Cypher, & Kafker, JJ. AMERICAN HONDA FINANCE CORPORATION.Ĥ79 Mass. AMERICAN HONDA FINANCE CORPORATION, 479 Mass.
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