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Posts tagged as “Auto Finance”

Calif. App. Court (4th Dist) Rules Arbitration Clause Invalid Due to Prohibition on Injunctive Relief

The Court of Appeals of the State of California, Fourth Appellate District, recently held that an arbitration provision contained in a credit card agreement was unenforceable because it sought to bar a customer from pursuing “in any forum” his claim for a public injunction.

9th Cir. Rejects Challenge to Assumption of Auto Lease in Bankruptcy

In a case of first impression on the issue of “whether a lease assumption can survive discharge even though it is not reaffirmed[,]” the U.S. Court of Appeals for the Ninth Circuit recently held that a creditor’s post-discharge attempt to collect the balance owed under an automobile lease assumed by the debtor post-petition but prior to discharge in a Chapter 7 case did not violate the discharge injunction. 

FTC Seeks Comments on FCRA Rules Impacting Motor Vehicle Dealers

The FTC will soon propose changes it says are designed to align several existing rules under the federal Fair Credit Reporting Act with the Dodd-Frank Act. The impacted rules cover only “motor vehicle dealers” being persons “predominantly engaged in the sale and servicing of motor vehicles, the leasing and servicing of motor vehicles, or both.”

DC Cir. Holds FDCPA Plaintiff Lacked Standing Under Spokeo

The U.S. Court of Appeals for the District of Columbia Circuit recently vacated a summary judgment order against a debtor on her claims against a debt owner and its debt collector for alleged violations of the federal Fair Debt Collection Practices Act because the debtor did not suffer a concrete injury-in-fact traceable to the alleged statutory violations and therefore lacked the required Article III standing.

3rd Cir. Holds Failure to Turn Over Collateral Repossessed Prior to Bankruptcy Does Not Violate Automatic Stay

The U.S. Court of Appeals for the Third Circuit recently held, in a case of first impression in that circuit, that a secured creditor’s failure to turn over collateral repossessed prior to the filing of the bankruptcy petition does not violate the automatic stay. A copy of the opinion in In re Denby-Peterson is available at:  Link to Opinion. The debtor’s automobile was repossessed after she defaulted on her installment loan. She then filed a voluntary petition under Chapter 13 of the Bankruptcy Code, notified her creditors and demanded the return of the automobile. The creditors did not comply, and the…

NJ Supreme Court Holds Invalidity of Transaction as a Whole Does Not Negate Arbitration Agreement

The Supreme Court of New Jersey held that where a plaintiff challenges the validity of a transaction as a whole and not specifically the arbitration agreement that is included as part of a transaction, the plaintiff must arbitrate their claims because an arbitration agreement is severable and enforceable, notwithstanding a plaintiff’s general claims about the invalidity of the transaction as a whole. Accordingly, the judgment of the appellate court was reversed and the trial court orders compelling arbitration were reinstated. A copy of the opinion in Goffe v. Foulke Management Corp. is available at:  Link to Opinion. The plaintiffs each purchased cars…

Missouri Supreme Court Reverses Class Cert Due to Overbreadth and Typicality Issues

The Supreme Court of Missouri recently held that a trial court abused its discretion by certifying an overly broad class with a class representative whose claims against the debt collector defendant were not typical of the class. More specifically, the class definition was deemed overbroad because approximately 87 percent of the class members’ claims were either precluded by final deficiency judgments, or estopped by their failure to disclose the claims in bankruptcy, and the class representative failed to meet typicality requirements, because she did not suffer the same alleged injury as the class members. A copy of the opinion in…

7th Cir. Holds Mere Need for Extrinsic Evidence to Interpret Ambiguous Contract May Not Be Enough to Avoid Class Cert.

The U.S. Court of Appeals for the Seventh Circuit held that merely requiring extrinsic evidence to interpret a provision of a form contract does not render class certification improper, and that absent a more thorough explanation of its reasoning from the trial court, it could not uphold the trial court’s ruling decertifying the class. As a result, the Seventh Circuit vacated the decision of the trial court and remanded for further proceedings. A copy of the opinion in Red Barn Motors, Inc. v. NextGear Capital, Inc. is available at:  Link to Opinion. The plaintiff auto dealerships entered into demand promissory note…

Fla. App. Court (4th DCA) Holds RIC Not Subject to State Usury Law

The District Court of Appeal of the State of Florida, Fourth District recently affirmed entry of summary judgment in favor of a motor vehicle retail seller and assignee against a consumer who alleged that the 27.81 percent interest charge under the retail installment contract (“RIC”) exceeded the interest rate limit imposed by Florida’s usury statute. In so ruling, the Court concluded that the financing contract at issue was not subject to the interest rate limit imposed by Florida’s general usury statute, but instead by the specific controlling statute, the Florida Motor Vehicle Retail Sales Finance Act. A copy of the…