Williams v. Ford Motor Credit Co.

Williams v. Ford Motor Credit Co. United States Court of Appeals for the Eighth Circuit, 1982. Facts: David Williams, the husband of Cathy Williams (Williams) (plaintiff), bought a car from a dealer. The car was titled in both of the Williamses’ names, but only David’s name was on the loan papers. The car loan was assigned to the Ford Motor Credit Company (company) (defendant). David and Williams later divorced. The divorce court granted Williams title to the car, but required David to make payments to the company. David defaulted and signed a repossession authorization. Williams was awakened at approximately 4:30 a.m. by a noise outside of her home. Williams discovered two men in the process of towing her car away. Williams stopped the tow truck by yelling. One of the men explained that he was repossessing the car for the company. Williams informed him that personal items were located inside of the car. The man retrieved the items for Williams and drove away with the car. Williams reported the car stolen to the police and then sued the company for conversion. Procedural History: At trial, Williams testified that the tow truck driver had remained polite and had not threatened or caused her to fear physical harm. The jury awarded Williams $5,000 in damages on the basis that the repossession had resulted in an unlawful “breach of the peace” in violation of Arkansas Statute § 85-9-503. The statute, which codifies Article 9 of the Uniform Commercial Code, allows a secured party to repossess its property without judicial process if the repossession occurs without breach of the peace. The district court entered judgment for the company notwithstanding the verdict. Williams appealed from the judgment, asserting that the repossession had occurred unlawfully, because it was accomplished by the risk of violence. Issue: Is repossession of property lawful, meaning that it has occurred without breach of the peace, if it is accomplished without creating violence or the risk of invoking violence? Holding: Yes, under Arkansas law, repossession of property is lawful, meaning it has occurred without breach of the peace, if it is accomplished without creating violence or the risk of invoking inciting violence. Reasoning: Repossession of property is lawful, meaning it has occurred without breach of the peace, if it is accomplished without creating violence or the risk of violence. In Ford Motor Credit Co. v. Herring, 589 S.W.2d 584 (Ark. 1979), the Supreme Court of Arkansas cited § 85-9503 in stating that conversion had been found in prior cases only when the repossession was accompanied by force, threats of force, or the risk of invoking violence. In Manhattan Credit Co. v. Brewer, 341 S.W.2d 765, the court found that a breach of the peace had occurred during a repossession in a case where the debtor and her husband confronted the creditor’s agent and clearly objected to the repossession. By contrast, in Rutledge v. Universal C.I.T. Credit Corp., 237 S.W.2d 469 (Ark. 1951), there was no breach of the peace when the debtor failed to object to the repossession. Here, Williams did not raise an objection to the towing. In addition, the towing occurred without any incident that might provoke violence. Although the company did not act commendably by towing the car during sleeping hours, even viewing the facts in the light most favorable to Williams, the towing was a legal repossession. The evidence does not support the jury’s verdict. The company is entitled to judgment notwithstanding the verdict. The district court’s judgment is affirmed. Dissent: The jury reasonably determined that repossession of the car constituted a breach of the peace. Williams did all within her power to stop the repossession. The only reason that the confrontation did not end violently is that Williams did not escalate the situation. A reasonable jury could find that the company’s 4:30 a.m. “night raid” created a risk of violence. There is no compelling reason to overturn the jury’s determination. An important policy consideration underlying § 85-9-503 is the discouragement of self-help remedies, if certain acts will likely result in violence. If a “night raid” is detected by the debtor and a confrontation results, the repossessor should have a duty to retreat and use the judicial process. The alternative allows the repossessor to proceed after a confrontation, until violence results. The court should seek to prevent that kind of tragic result. The district court should be reversed, and the jury’s verdict should be reinstated.