The exhibits were marked as Exhibits 2 through 34 and are composed of documents 1

Bates stamped by Volvo from 1 through 525. All exhibits referred to in the motion and affidavits

are not attached because they are voluminous. Both parties have these documents. If the court

requests, copies will be submitted.

IN THE UNITED STATES DISTRICT COURT FOR THE

MIDDLE DISTRICT OF ALABAMA

VFS LEASING CO., )

)

PLAINTIFF, )

) CIVIL ACTION NO.: 3:06CV638-SRW

VS. )

)

G. F. KELLY, INC d/b/a KELLY )

TRUCKING; and GUY KELLY, ) 

)

DEFENDANTS. )

DEFENDANTS’ RESPONSE TO 

PLAINTIFF’S MOTION FOR SUMMARY JUDGEMENT

Comes now the Defendants G. F. Kelly, Inc. d/b/a Kelly Trucking and Guy Kelly and,

and submits the following in response to the Motion for Summary Judgement filed by

Plaintiff:

FACTUAL SUBMISSION

1. The deposition of Kevin Miller, plaintiffs’ representative.

2. Documents produced by plaintiff at the deposition, all of which were made

exhibits to the deposition.1

3. Volvo reconciliation reports (Exhibit A).

4. Volvo spreadsheet recapping the disposition of the trucks (Exhibit B).

5. Affidavit of Guy Kelly with attachment.

6. Affidavit of Charles Lance.

SUMMARY JUDGEMENT STANDARD

Under the provisions of Rule 56©), F.R.C.P., summary judgement is appropriate if “there is no

genuine issue as to any material fact and that the moving party is entitled to a judgment as a

matter of law.” See Celotex v. Cattrett, 477 U.S. 317, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). 

Case 3:06-cv-00638-SRW Document 20 Filed 02/13/2007 Page 1 of 8
The movant “always bears the initial responsibility of informing the district court of the basis for

its motion”... and ... must “demonstrate the absence of a genuine issue of material fact.” Id. 

After the movant has met its burden under Rule 56( c ), the non-movant must set forth

“specific facts showing that there is a genuine issue for trial” Id. In ruling, the Court “must

believe the evidence of the non-movant and must draw all justifiable inferences from the

evidence in the non-moving party’s favor.” See Anderson v. Liberty Lobby, Inc., 477 U.S. 242,

255, 106 S.Ct. 2505, 2513-14, 91 L.Ed.2d 202 (1986); cited in Reeves v. Thigpen, 879 F.Supp

1153, 1166 (M.D.Ala. 1995).

STATEMENT OF THE CASE

In this case, Volvo claims that it is owed money by the defendants due to their default

under three truck leases. While Kelly Trucking admits that it is in default of the leases and owes

some amount of money to Volvo, it vigorously disputes the amount being claimed. 

At the time of default, Kelly Trucking was operating 21 tractors covered by the leases. 

One additional tractor covered by the leases had been wrecked so it is not at issue in this

litigation. The 21 trucks were repossessed by Volvo in the fall of 2005. All 21 trucks were sold

to third parties by Volvo in the October and November, 2005.

 The case is still in the discovery stage and will be until April 30, 2007. Defendants will

provide expert witness information on or before February 28, 2007 as required by the court’s

schedule. Defendants plan to utilize at least one expert in addition to Guy Kelly and Charles

Lance.

 

STATEMENT OF FACTS

1. Volvo has not provided any evidence that the 21 trucks at issue were resold in a

commercially reasonable manner or that the amounts it is attempting to charge the defendants are

reasonable and proper. In its motion, Volvo simply attaches some documents as exhibits that

have amounts of money in them. It has submitted no evidence as to the reasonableness of the

amounts or that the amounts claimed are due under the lease.

2. This dispute involves 21 trucks. Kelly Trucking was unable to make payments

Case 3:06-cv-00638-SRW Document 20 Filed 02/13/2007 Page 2 of 8
 under the leases starting in 2005 and, due to unforeseen circumstances, was forced to default on

the leases. Kelly Trucking fully cooperated with Volvo in providing access to the trucks at its

yard in Wadley, Alabama. As the trucks were brought to the yard, Kelly Trucking called Volvo

and Volvo sent drivers to Wadley. The trucks were driven from Wadley to the Adessa yard in

Fairburn, Georgia. The distance from the Kelly Trucking yard to the Adessa yard is less than 75

miles. Volvo did not incur any direct expense in repossessing the trucks other than the cost to

drive 150 miles round trip. (Kelly Affidavit).

3. As shown on the submitted Volvo reconciliation reports (Exhibit A), plaintiff is

attempting to charge the defendants a repossession fee of $700.00 per truck. Part of the amount

Volvo is claiming in its Motion is for $14,700.00 in repossession expenses. These charges are

completely unreasonable. In light of the fact that the only cost would be administrative plus

driving 150 miles, the maximum reasonable cost per truck would be $200.00. In its motion,

Volvo is asking the court to award it a much greater amount. (Kelly Affidavit).

4. The Volvo reconciliation reports also show that it is attempting to charge the

defendants a $300.00 inspection fee for each truck, a total of $6,300.00. Again, this charge is

grossly excessive and unreasonable. The maximum reasonable charge per truck for inspection is

$125.00. In its motion, Volvo is asking the court to award it a much greater amount. (Kelly

Affidavit).

5. Volvo is attempting to charge the defendants a detailing fee on eight trucks of

$500.00 per truck. This charge also is greatly excessive. In 2005, the reasonable charge for

detailing a truck of this type was $125.00. Volvo is requesting an award of $#,000.00 more than

it is due. (Kelly Affidavit; Lance Affidavit).

 6. There are clearly established facts in the record that the repossession, inspection

and detailing fees that Volvo is asking this court to access are excessive and unreasonable.

7. The company hired by Volvo to perform the inspections prepared an appraisal

report and took pictures of each truck. The report stated the specifications of the truck and also

included an estimate of reconditioning expenses which the inspector determined needed to be

performed in order to bring the truck to a wholesale condition. (Miller Depo. 30-34).

Case 3:06-cv-00638-SRW Document 20 Filed 02/13/2007 Page 3 of 8
8. Volvo maintains a website on which it posts information about trucks it has for

resale. Once Volvo is ready to put the truck out for bid, the appraisal and the pictures are

viewable by dealers who are registered to access the site and bid on trucks. (Miller Depo. 41-47).

9. The website has a sale price for each posted truck. According to the Volvo

representative, the sales price shown on the website for a particular truck is the maximum NADA

wholesale price plus $3,000.00-$5,000.00. (Miller Depo. 46-47). However, the true facts for the

21 trucks at issue here are very different. As shown on the Volvo recap (Exhibit B), the sale

price on these trucks was substantially less than the maximum wholesale plus $3,000.00-

$5,000.00. As a result, the bar was lowered at the very beginning as far as what Volvo could

expect to get for these trucks. (Kelly Affidavit).

10. Once a truck is put out for bid on the website, the auction could stay open for any

length of time and the time was determined solely by Volvo. The auction could stay open for

five minutes or 30 days. Miller testified that the auction was generally left open for seven to ten

days. (Miller Depo. 54-57). Again, the evidence in this case is totally inconsistent with Miller’s

testimony. Only two of the 21 auctions stayed open for seven or more days. Sixteen of the

auctions were open for four days or less, and 12 of the auctions lasted less than 48 hours. (Kelly

Affidavit).

11. Other truck finance companies and auction houses that conduct auctions on their

websites follow a completely different practice. The standard in the industry is that the auction

should be open for a specified period of time and the end of the auction would be readily known

by looking at the website page for a particular truck. Once that time comes, the auction

automatically closes regardless of the status of bids. Also, the industry standard requires that the

high bid be posted on the website. Volvo’s site does not show the high bid. In addition to having

sole discretion as to when the auction closes, Volvo does not let bidders know what they need to

bid in order to be high bidder at any given time. Nor do the bidders know that a previously

submitted bid has been exceeded by another bidder and that they need to submit another bid if

they want the truck. Auctions conducted on Volvo’s website do not comply with industry

standards and are not commercially reasonable. (Kelly Affidavit).

Case 3:06-cv-00638-SRW Document 20 Filed 02/13/2007 Page 4 of 8
12. As stated previously the appraisal report which is viewable on the website for

each truck contains an estimation of costs to recondition the truck to bring it to wholesale

condition. The reconditioning expenses for the 21 trucks at issue here are greatly excessive and

unreasonable. In fact, the total of the so-called reconditioning expenses for these 21 trucks is

more than $50,000.00 in excess of the actual expenses. As a result, bidders are given a false

impression as to the value of these trucks resulting in lower bids and lower sale prices. (Kelly

Affidavit; Lance Affidavit).

13. These trucks were not sold in a commercially reasonable manner as described in

detail in the affidavit of Guy Kelly. Despite the fact that the trucks were sold in a seller’s market

(Miller Depo. 233), the total amount received by Volvo for the 21 trucks is more than

$100,000.00 less than it should have been. Volvo sold these trucks at a huge discount, thereby

giving the defendants much less of a credit on the amount due under the leases. The actions of

Volvo were not commercially reasonable.

14. As shown on the Volvo recap spreadsheet (Exhibit B), three trucks were

purchased by Volvo & GMC of Charlotte and five trucks were bought by The Ed Schmidt Truck

Store. These two dealers are top ten customers of Volvo. (Miller Depo 210,220) As stated by

Miller in his deposition and evidenced by the documentation, in the three auctions on which

Volvo of Charlotte was the low bidder, the bids were closed as soon as Volvo of Charlotte

submitted a high bid. The same sort of situation occurred on the auctions where Schmidt was the

low bidder. All of the auctions lasted for a very short amount of time and all were closed with

the top ten dealers in the low bid position. These eight auctions were not conducted in a

commercially reasonable manner. (Kelly Affidavit).

15. Kevin Miller testified that trucks posted on the Volvo website are sold “as is,

where is”. (Miller Depo. 68-69). This is in keeping with the industry standard. Bidders are

assumed to know the condition of the trucks since the inspection report and pictures are available

on the website and the trucks are available for visual inspection at the location where they are

stored. (Kelly Affidavit).

16. Despite the stated policy, Volvo paid out over $12,000.00 to purchasers of three

Case 3:06-cv-00638-SRW Document 20 Filed 02/13/2007 Page 5 of 8
trucks after the sale was finalized and the proceeds paid to Volvo. This action by Volvo was

totally inappropriate and commercially unreasonable. On one of the trucks, the problem was

visually evident to both the inspection company hired by Volvo and the purchaser. On the

second truck, the problem could easily be diagnosed and should have been diagnosed by the

inspection company as well as the purchaser. (Miller Depo. 188-195). On the third truck, Miller

could not even say that the problem was present on the date title was transferred to the purchaser. 

Miller admitted that the problem for which he paid over $2,000.00 to the purchaser could very

well have happened after the title to the truck was transferred. Volvo is attempting to charge the

amount of these three payments to the defendants. This is not only commercially unreasonable, it

is unfair. 

17. In summary, the defendants have submitted evidence showing that the attempted

charges by Volvo for repossession, inspection and detailing were excessive and unreasonable. 

These charges are included in the amount Volvo is asking the court to award in its Motion for

Summary Judgment. Additionally, the trucks were not disposed of in a commercially reasonable

manner and were sold at prices substantially less than the actual value because of the manner and

method in which they were sold. The amount due Volvo from the defendants should be

substantially less than the amount that is claimed. Finally, Volvo is asking that it be reimbursed

for monies paid out to purchasers after title was transferred despite the fact that its policy is “as

is, where is.” 

ARGUMENT

Plaintiff is not entitled to summary judgment. It has not made any showing that its

actions in disposing of these trucks and charging the defendants for a huge amount of “expenses”

were reasonable. Volvo has not in any way “...demonstrat[ed] the absence of a genuine issue of

material fact.” Celotex, Supra. 

Secondly, there are numerous genuine issues of material fact present in this case. The

defendants have produced evidence that the charges claimed by Volvo for repossession,

inspection and cleaning are unreasonable and excessive. The defendants have produced evidence

that Volvo paid more than $12,000.00 in contradiction of its stated “as is” policy. The

Case 3:06-cv-00638-SRW Document 20 Filed 02/13/2007 Page 6 of 8
defendants have presented evidence that the disposition of the trucks was not commercially

reasonable. There is evidence that the sale price posted was too low and that there was no set

and published time for the auction to remain open. Additionally, the bidder was not aware of the

high bid, contrary to industry standards. There is also evidence that the posted reconditioning

expenses were extremely high and unreasonable, logically leading to lower bids. Finally, there is

evidence that Volvo bent over backwards to help its top customers. 

The factual issues outlined above involve a substantial amount of money. The defendants

should be allowed to present their full case in an understandable and organized fashion so that

the judgment against them is consistent with the facts and industry standards.

Whether Alabama or North Carolina law governs this case is not important because the

relevant statutes are identical. N.C. Gen. Stat. § 25-28-504(1) and Code of Alabama § 7-28-

504(1) both provide that “...damages payable...for default...may be liquidated but only at an

amount that is reasonable...”. This requires that the plaintiff act in a commercially reasonable

manner in disposing of equipment under the lease agreements and in charging the lessee for

alleged expenses associated with the default.

The defendants have been unable to locate a case decided under either the Alabama or

North Carolina statute where the issue of reasonableness was discussed. However, there are

cases involving the commercially reasonable standard under Title 9 of the UCC. The law is clear

that the party selling the equipment has the burden of proof to show that its actions in all respects

were commercially reasonable. Arden Equipment Co. v. Rhodes, 55 N.C. App. 470, 472, 285

S.E. 2d 814 (1982). If there are disputed facts, summary judgment is inappropriate and the case

must proceed to trial. Parks Chevrolet, Inc. v. Watkins, 74 N.C. App. 719, 722 (1985).

Plaintiff has not come close to meeting its burden. Volvo has submitted absolutely no

evidence to support that is actions were commercially reasonable and that the charges it is

attempting to impose on the defendants are commercially reasonable. Also, there are numerous

factual disputes that require a trial. 

CONCLUSION

The Motion for Summary Judgment should be denied.

Case 3:06-cv-00638-SRW Document 20 Filed 02/13/2007 Page 7 of 8
 Respectfully Submitted, 

 /s/ James H. Starnes 

James H. Starnes, Attorney for Defendants 

OF COUNSEL:

P. O. Box 590003

Birmingham, AL 35259-0003

(205) 320-0800

/s/ S. Sanford Holliday 

S. Sanford Holliday, Attorney for Defendants 

OF COUNSEL:

P. O. Box 727

Roanoke, AL 36274

(334)863-2717

 CERTIFICATE OF SERVICE

I hereby certify that I have the foregoing pleading electronically using the CM/ECF

system which will electronically serve a copy of same on all counsel of record on this the 29th

day of November, 2006 as follows:

David B. Hall

Jason Asbell

BAKER DONALDSON 

420 North 20 Street, Suite 1600 th

Birmingham, AL 35203

 

/s/ James H. Starnes 

 OF COUNSEL

Case 3:06-cv-00638-SRW Document 20 Filed 02/13/2007 Page 8 of 8
NATIONAL COURT REPORTING

1 IN THE UNITED STATES DISTRICT COURT

2 FOR THE MIDDLE DISTRICT OF ALABAMA

3

4 VFS LEASING CO.,

Page 1

5

6

7

8

9

10

VS.

Plaintiff,

CASE NO.

3:06cv638-SRW

11 G.F. KELLY, INC., d/b/a KELLY

12 TRUCKING; and GUY KELLY,

13

14

15

16

17

Defendant.

DEPOSITION OF KEVIN MILLER

18 STIPULATIONS

19 IT IS STIPULATED AND

20 AGREED, by and between the parties,

21 through their respective counsel,

22 that the deposition of KEVIN MILLER

23 may be taken before Sunnie E.

Case 3:06-cv-00638-SRW Document 20-2 Filed 02/13/2007 Page 1 of 22
NATIONAL COURT REPORTING

Page 2 Page 4

Gillespie, Commissioner, State of

Alabama at Large, at the law offices

of Baker, Donelson, Bearman, Caldwell

& Berkowitz, PC, 420 20th Street

North, Suite 1600, Birmingham,

Alabama, on the 14th day of December,

2006, commencing at or about 10:02

a.m.

1

2

3

4

5

6

7

8

9 IT IS FURTHERSTIPULATED

10 AND AGREEDthat the reading and

11 signature to the deposition by the

12 witness is waived, said deposition to

13 have the same force and effect as if

14 full compliance had been had with all

15 laws and rules of court relating to

16 taking of depositions.

17 IT IS FURTHERSTIPULATED

18 AND AGREEDthat it shall not be

19 necessary for any objections to be

20 made by counsel as to any questions,

21 except as to form or leading

22 questions, and that counsel for the

23 parties may make objections and

Page 3

1 assign grounds at the time of the

2 trial, or at the time said deposition

3 is offered in evidence, or prior

4 thereto.

5 IT IS FURTHERSTIPULATED

6 AND AGREEDthat notice of filing of

7 the deposition by the Commissioner is

8 waived.

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

1 INDEX

2

3 EXAMINATION BY: PAGENO.

4 Mr. Starnes---------------------8

5

6 EXHIBITS

7 DEFENDANT'SEXHIBIT NO. MARKED

8 1 - Deposition Notice-------------71

9 2 - Recap of sales----------------72

10 3 - E-mail & photos---------------78

11 4 - File 013, Bates 129-154-------82

12 5 - File 014, Bates 328-349------122

13 6 - Adesa Sale Advertisement-----136

14 7 - File 015, Bates 363-388------142

15 8 - File 016, Bates 304-327------147

16 9 - File 017, Bates 026-051------150

17 10 - File 018, Bates 226-241C----152

18 11 - File 019, Bates 52-75-------161

19 12 - File 020, Bates 103-128A----164

20 13 - File 021, Bates 1-25--------168

21 14 - E-mail & photos-------------174

22 15 - File 738, Bates 389-409-----176

23 16 - File 739, Bates 350-362-----178

Page 5

1 EXHIBITS

2 DEFENDANT'SEXHIBIT NO. MARKED

3 17 - File 763, Bates 242-265-----182

4 18 - File 764, Bates 532-559-----185

5 19 - Repair Invoice on 764-------191

6 20 - File 762, Bates 266-303-----195

7 21 - File 584, Bates 410-431-----197

8 22 - File 989, Bates 204-225-----199

9 23 - File 958, Bates 447-472-----203

10 24 - Repair Invoice on 958-------208

11 25 - File 954, Bates 155-178-----210

12 26 - File 953, Bates 473-482 &

13 433-446--------------------- 211

14 27 - File 952, Bates 179-203-----215

15 28 - File 959, Bates 76-102 & 72-218

16 29 - Repair Invoice on 021-------222

17 30 - Repo & Delivery docs-------- 222

18 31 - Collector system notes------224

19 32 - Collector system notes------ 225

20 33 - Collector system notes------225

21 34 - Collector system notes------225

22

23

252-6205

2 to 5)

Case 3:06-cv-00638-SRW Document 20-2 Filed 02/13/2007 Page 2 of 22
NATIONAL COURT REPORTING

Page 6 Page 8

BEFORE: EXAMINATION SunnieBYE. Gillespie MR. STARNES: 1

StateQ.Commissioner your name, please, 2

sir. 3

APPEARING KevinA. ArthurONMiller. BEHALFOFTHE PLAINTIFF:4

Mr.Mr. Q.Miller, Jasonwhat's Asbell your 5

residence Baker, Donelson, address?Bearman, 6

8101 Caldwell A. Stafford & Berkowitz, Mill Road,PC 7

Oak420Ridge, NorthNorth 20th Street Carolina 27310. 8

Okay. Suite Q. Is1600that Charlotte, 9Raleigh, Birmingham, Durham, Alabama 1035203 what area of North

Carolina? 11

Greensboro. APPEARING A. ON BEHALFOFTHE DEFENDANT: 12

Greensboro. Mr. Q.James H.AllStarnes right. By 13

whomLaw Office are youof James employed? H. Starnes 14

By 300 Volvo A. 21st Financial Street North, Suite 501 15

Services. P.O. Box 590003 16

What's Birmingham, Q. your position? Alabama 35259-0003 17

Remarketing A. manager. 18

In that Q. position, what 19

ALSO generally PRESENT: are your duties and 20

responsibilities? None 21

To handle A. the resale and 22

remarket of off leased and 23

KEVIN MILLER,

having been first duly sworn, was

examined and testified as follows:

THE COURT REPORTER: Usual

stipulations?

MR. STARNES: Yes.

Page 7

1 I, Sunnie E. Gillespie,

2 Commissioner, State of Alabama at

3 Large, acting as commissioner,

4 certify that on this date, in

5 accordance with Rule 30 of the

6 Alabama Rules of Civil Procedure and

7 the foregoing stipulations of

8 counsel, there came before me at the

9 law offices of Baker, Donelson,

10 Bearman, Caldwell & Berkowitz, PC,

11 420 20th Street North, Suite 1600,

12 Birmingham, Alabama, on the 14th day

13 of December, 2006, KEVIN MILLER,

14 witness in the above cause for oral

15 examination, whereupon the following

16 proceedings were had:

17

18

19

20

21

22

23

Page 9

1 repossessed equipment.

2 Q. Are you overall in charge

3 of that for the entire operation or

4 is it regional or what?

5 A. I'm over the trucks and

6 currently also the construction

7 vehicles.

8 Q. Construction vehicles

9 talking about heavy equipment, off

10 road construction equipment?

11 A. Right.

12 Q. Okay. How long have you

13 been in this position?

14 A. Eight years.

15 Q. And been with Volvo

16 Financial--

17 A. Eight years.

18 Q. -- eight years? Let me go

19 ahead and get your background before

20 I get some information about the

21 company. Where did you graduate from

22 high school?

23 A. Roosevelt High School in

1425 FINANCIAL CENTER

1-800-638-3917 Birmingham, Alabama 35203 (205)

3 (Pages

252-6205

6 to 9)

Case 3:06-cv-00638-SRW Document 20-2 Filed 02/13/2007 Page 3 of 22
NATIONAL COURT REPORTING

Page 10

12 Page

isMinneapolis. it located, it's home? 1

Greensboro, AndA. Q.then whatNorthwasCarolina. your 2

formal Okay. Q. education And that's after wherethat? 3

you're Univrsity A. based? of Minnesota, a 4

community Yes.A. college too, I can't 5

remember Do Q.you havetheother nameoffices of it. 6

around That's Q. okay. the country that have 7

A. remarketing It's just left me. popleAndin them that 8

then reportI tohaveyou,anorengineering is that all done degree at 9

out University of the of Greensboro Minnesotaoffice? and then with 10

It'sTMI,all A.specialize done out inof truck the 11

appl Greensboro ications. office. 12

Okay. Q. What How many is TMI?people do 13

A. It'syouahave company that work that --under it's you that 14 are

ainvolved school that in remarketing? is just for theI'mtrucknot 15talking business. about Theyclerical specialize help orin it. that 16

But sortQ.engineering of thing, I'm talking about --

17

One. applications, A. that kind of thing? 18Yes.

-- oneQ. person? 19

Yes. Okay.A. All right. Is that 20

Okay. the Q.extent Whatofdoes yourthat formal education? 21

Yes. person A. do vis-a-vis you? 22

Pretty All right. A. Q.muchTellshe's me your qualified 23

113 Page

toworkdo history pretty much briefly.everything that I 1

do. I worked A. for a construction 2

company SOdoQ. y'allforsort seven of divide years in their 3

truck up theshop workwhen load?I was Likegoing do youthrough have 4

school, so manyandunitshenoutI there, wokeddofory'all GE 5

Capital kind of Fleet split itServices up someforway, 20 years, or are 6

y'all and then both Iinvolved went towith workeach for Volvo unit, 7

or Financial. how does that work? 8

We're GEA. Q.Capital, both involved where didinyou each 9

work, unit towhat someoffice? degree, and I basically 10Eden haveA.Prairie, the overall Minnesota. say in it. 11And Okay. Q.theBut lastisjobthereyousome had 12

was role that what?she plays generally with 13

Their eachA.marketing unit and some manager. role that you14

How play?Q.long did you do that 15

She for them? A. does most of the 16

FromA. clerical -- ten datayears,ntry '88stuff.to 17

Okay. '98.Q. In terms of actually 18

Did deciding that Q. involve how thethetruck resaleis going to19be

of remarketed repossessed, in what over-the-road fashion, what way, 20

tractors is that something among other you things? decide? 21

That Correct. A.would be my decision, 22

Now, although Q.Volvoit can Financial, be a community where 23

Case 3:06-cv-00638-SRW Document 20-2 Filed 02/13/2007 Page 4 of 22
NATIONAL COURT REPORTING

Page

30 Page 32

thing Those Q.that's kindsdonef things? after you get the 1recovery Correct. A. documents? 2We Do Q.theyire aputoutside a valueappraisal on 3

them? services called Asset Appraisal 4

Services, No,A.they doandnot. they inspect the unit. 5

You Okay. Q.callSoit what Assetinformation what? 6

doAsset you A. Appraisal generallyServices. get from the report 7

that AreQ.they -- didayounationwide say that you call 8

them company? AAS? 9 

ii

Yes. Yes,A.AAS. 10

Do Okay. you Q. What know generally where their do Ii11

you homegetis?from an AAS report, you know, 12 Ii

Omaha, doingA. your Nebraska. job? 13

ii

Okay. Are A. they Q. They affiliated go outwithand they 14inspect any otherthecompany unit. Theyto your list theknowledge? 15

They're specifications A. an independently on the unit. They 16

owned mak note company. of damages or conditions 17

Okay. thatQ.would Theydetract have nofrom the value. 18

They relationship estimateother the than repairs needed to 19

client/customer bring the unit towhatever a wholesalewithvalue. Volvo? 20

Correct. TheyA.post 8 to 26 photos, and that 21

Doinspection they Q. haveis loadedffices onaround our website. 22You the Q.say country? 28 photos? 23

ii

31 Page 33

UpNo.A. to. 1

They Up Q.to.send somebody to the 2

trucks? At that A. time. 3

Yes,A. TheyQ.they list specifications, do. 4

note Okay.anySodamages you wouldor conditions, 5estimate contact --theandpayers I say you, necessary your to 6

iii

department, bring the unitandto wholesale? when I use that 7

generic Wholesale A. you,condition. that's what I'm talking 8about AndQ.hey generally. take photographs You send them 9

of something the unit?saying we've got some 10

Correct. trucksA. located at some location and 11

UpthentoQ.they 28? send somebody to appraise 12

Correct. them?A. 13

HaveQ.you heard the use of 14

And the Q.dophrase we have in terms someof ofthis kind of15

their used appraisal truck situation reportstradein these terms? 16

Correct. files?A. 17

Yes. Is that Q. basically what 18

Generally wholesale Q. speaking, condition dois, they trade terms, 19

or notearethethosemileage diffrent on thethanunit?the way 20

Yes. youA.understand that to be used?21

There's The A. Q.condition a coupleof of the unit? 22

Yes. different A. interpretations of trade 23

1425 FINANCIAL CENTER

1-800-638-3917 Birmingham, Alabama 35203 (205) 252-6205

9 (Pages 30 to 33)

Case 3:06-cv-00638-SRW Document 20-2 Filed 02/13/2007 Page 5 of 22
NATIONAL COURT REPORTING

Page 36

1 specifications listed in each --

2 under each category -- .

3 Q. Sure.

4 A. -- to a specific vehicle.

5 Q. But there's nothing in the

6 N.A.D.A. book concerning the specific

7 condition of tires; for instance, how

8 much tread and that kind of thing?

9 MR. ASBELL: Object to the

10 form.

11 A. No.

12 Q. (BY MR. STARNES) Is that,

13 generally speaking, a part of what

14 somebody is talking about when they

15 talk about a truck being up to trade

16 terms or wholesale condition?

17 MR. ASBELL: Object to the

18 form.

19 Q. (BY MR. STARNES) You can

20 answer.

21 MR. ASBELL: If you know,

22 you can answer.

23 A. Yes.

A. Correct.

Q. (BY MR. STARNES) Pull one

it.

Page 34

1 terms, but the most generic trade

2 term, when you say trade terms,

3 that's wholesale is what they're

4 talking about.

5 Q. And this includes the

6 condition of the tires, and there's a

7 lot of things that go into that?

8 A. Correct. It's also spelled

9 out in --

10 Q. The N.A.D.A.?

11 A. Correct.

12 Q. SOwhat you were describing

13 as wholesale condition is what that

14 condition that's described in the

15 N.A.D.A. book?

16 MR. ASBELL: Object to the

17 form.

18 Q. (BY MR. STARNES) Is that

19 correct?

20 MR. ASBELL: You can answer

21

22

23

Page 35

1 of your books out and let's just say

2 what page that is and just identify

3 it for me so I can -- I mean, I've

4 got some of those books so I don't

5 necessarily need this, but --

6 A. And there's more detail but

7 that's --

8 Q. Okay. For the record, the

9 inside front cover of the N.A.D.A.

10 manual, there is what's called a

11 publisher's note, and the witness has

12 pointed to the third paragraph that

13 begins with the values in this guide

14 consumer vehicle in average condition

15 for its age. Are there some

16 additional details somewhere in the

17 book relating to specifying wholesale

18 condition or trade terms?

19 A. There's mileage section

20 that has to be considered, mileage

21 adjustment.

22 Q. Right.

23 A. And then there's

Page 37

1 Q. (BY MR. STARNES) Do you

2 know of anything in writing that

3 Volvo uses that specifies the

4 particulars of what it considers to

5 be wholesale condition?

6 A. There's the UTA, the Used

7 Truck Association --

8 Q. Right.

9 A. -- has a printed guideline

10 for trade terms.

11 Q. Okay.

12 A. And that's been compiled

13 from industry people.

14 Q. Okay. And what--

15 A. And it's more or less the

16 standard in the industry.

17 Q. And that's generally what

18 y'all use?

19 A. Correct.

20 Q. Okay. Fair enough. All

21 right. You've given me all the

22 general information that's provided

23 to you by Asset Appraisal Services

Case 3:06-cv-00638-SRW Document 20-2 Filed 02/13/2007 Page 6 of 22
NATIONAL COURT REPORTING

Page

38 Page 40

when out onthey the unit. go inspect Tha'sa not unitgoing that's to 1been hlp change repossessed? what someone will pay for 2it, Yes. but A. it lets me know where we're3

sitting. AndQ.then you say that 4

information Is that Q. information is loaded on its website? 5

contained Yes,A.our website. in what recovery has sent 6

you? AndQ.who has access to that 7

information? It's A.in the file, yes. 8

Somebody Q. MR. ASBELL: has alreadyObject givento the9

form. you that; that's something you can 10

The justA. initial look ataccess the fileis Volvo that's been 11

Asset providedpersonnel to you and obtain Deborahtheand 12myself. information about what's owed on the 13

(BYunit?Q.MR. STARNES) Okay. So 14

Correct. youA.say they But Iload generally it on your website, 15then pull itthat's -- I generally when youpull canit look from at it? 16

Correct. our A.-- I pull the account up in our17

It'ssystem. available Q. to you? 18

Correct. Okay. A. Q. All right. What's 19

Donext?they Q. also send you a 20

Wewritten price A. report the unit or and not?then 21

There's the A.unitaisPDFposted file ofviewable the so that 22the inspector's dealers written can bidreport on thethat's units. 23

Page 39

Page 41

attached. Okay. Q. Let's go one at a 1

time. ThatQ.youYoucanpriceprint? the unit? 2

ThatA. Right. A.I could We setprint, an asking yeah. 3

price. ButQ.basically the 4

information All right. Q. Tell is transmitted me, and I to you 5

want elecronically, to get thiseither as detailed uploadedas orI 6

can, set what to youprocess as a PDF? do you go through 7

Right. A. to priceIt'sa repossessed, uploaded onover-the-road8

theractor? website. 9

The All right. A. Q.condition Onceofyoutheget unit 10

the is taken inspection ino consideration, report from AAS, the what 11

doprices youthat do?we have attained 12

A. Ipreviously. review the photos, the 13

What write-up Q.do you on themean? unit. Tell me 14When watQ.you you mean say write-up, by that. is 15Our thatA. previous the notesales. of damages and 16And condition? Q.you have access to 17Correct, thoseA. innecessary. your database? 18

Yes. Right. A. Q. Okay. You review 19

SOthewhat, Q.inspection you look report? at 20

Correct. previous A. sales of a similarly specked 21

All 2004right. Q.Peterbuilt? 22

Italso would A.ookbeat--what's owed 23

1425 FINANCIAL CENTER

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11 (Pages 38

252-6205

to 41)

Case 3:06-cv-00638-SRW Document 20-2 Filed 02/13/2007 Page 7 of 22
NATIONAL COURT REPORTING

Page

424 Page

itI and mean, Q. it'sisquicker. that what you're 1talking Oay. Q. about Wha else whenwould you say you-- 2

doYes,inA.similar. preparation for pricing the 3

unit; Well, Q.look is that at the similar N.A.D.A. or do book? 4

you N.A.D.A. A.just look book.at 2004 tractors of any 5

make AndQ.what with else? an X type engine in it? 6

AndA.currently MR. ASBELL: what units Object to the7

form. have sold for and been financed in 8

our WeA.system bring it byrightourdown dealers. to 9

How the Q.specifications. would you do that? 10

Through (BY Q.A. MR. STARNES) our system Okay. agin. 11

What You put wasin,next? you know, 2001 Volvo 660, 12

Weandreview A.you canauction see, look results. at what was 13

How booked Q.do you for thedo that? last month. 14

There's Okay. A. Q. Anything a on-line else? auction 15

Wholesale, results A. that wholesale you can go to and sort 16

andpprovals, then wewholesale go -- thenreport, we lookwhich-- 17

Let wouldme Q. beaskwhat you this the dealers before have18theweunitsgetinoff theirauctions. inventoryTell for.me which 19

How onesQ.would you typically you getlook that at. 20

At A. information? that time we were using 21

From whatA.our waswholesale called -- itgroup was yellow, 22

and Machinery I also sign Traderoff and on all thetheTruck unitsPaper 23

Page

435 Page

that has purchased go on to ourthat,wholesale. purchased that 1publication, EvenQ.if theyand -- I don't remember 2

what FloorA.it'splan. -- we just called it the 3

yellow -- just Q. book. take in a trade? 4

Correct. Okay. A. Q. Any others that you 5

looked I'm Q.stillat?not quite clear. 6

The Do A. youN.A.DA call your book. wholesale group and 7

say ButQ.okay, as farwhat's as auction the going wholesale 8price results,fordidX tractor you lookor atis there anything 9other information? than the yellow book auction 10

There's site?A. inventory reports 11

Yellow youA.canbook go into records by dealer all or by all 12

auction and seesales. what inventory is out there, 13

Okay. whatQ.they are into it for. It's a 14

A. Itfloor wasplan. an industry We hold the floor plan15

collection on many ofoftheauction dealers. sales. 16

Okay. Q. SoIs this this anwould actual be in 17

Volvo publication Financial's you would database? get weekly, or 18

Uh-huh. is thisA. something you would look at 19

Your on theQ.answer internet? is yes? 20

We Yes.would A. get one copy 21

All in-house, right. Q. Anything but, you else? know, we looked at 22

That it on-line A.prettybecause much covers you canit. just sort 23

"~co"~"~"~,

Case 3:06-cv-00638-SRW Document 20-2 Filed 02/13/2007 Page 8 of 22
NATIONAL COURT REPORTING

Page 46 Page 48

MR. ASBELL: Object to the

form.

Q. (BY MR. STARNES) You can

answer it. Do they pay for access?

A. No, they do not.

Q. How do they go about

Q. What's the markup?

A. It depends on if the unit

is a better looking unit, you know,

we'll mark it up higher.

Q. Tell me what the range is,

and is this something you do?

MR. ASBELL: Object to the

1 Q. All right. After you price

2 the unit, what do you do?

3 A. We make the unit viewable

4 on our website.

5 Q. All right. And this would

6 be just pictures of the unit and a

7 description; what would be typical?

8 A. The full appraisal or

9 inspection is posted on the system.

10 The only thing they can't see is

11 appraiser comments and creditor

12 comments are held back. It's a full

13 disclosure type site.

14 Q. Okay. Anything else on

15 that site about this particular unit;

16 is the price on there?

17 A. It's priced on there, and

18 there's an area where they can go

19 into and place a bid.

20 Q. The price that you put on

21 this website, is it wholesale plus a

22 markup; what is the price?

23 A. It's wholesale plus markup.

Page 47

1

2

3

4

5

6

7

8 form.

9 A. Yes.

10 Q. (BY MR. STARNES) Okay.

11 Tell me how you do it.

12 A. Generally take the N.A.D.A.

13 value because that's what we use to

14 finance off of, and I will not take

15 condition into play on that number

16 and I'll price it up 3, 4, $5,000

17 above that.

18 Q. Depending on what?

19 A. How nice the unit looks.

20 Q. Okay.

21 A. The reason I do that is

22 sometimes the dealers will show that

23 to a user.

1 Q. Show what?

2 A. They'll show the -- they'll

3 go on the website as a sales tool for

4 them too. And so that price isn't

5 necessarily an actual sales price.

6 Q. You mean it had some float

7 in it?

8 A. Yes.

9 Q. Who has access to the

10 information on the website at this

11 stage, the stage we are right now?

12 A. There's 14 -- at that time

13 there was 14 to 1500 dealers signed

14 up, registered, that can access that

15 24 hours a day, 7 days a week.

16 Q. Okay. Do they pay you for

17 this?

18

19

20

21

22

23

Page 49

1 getting permission to or getting

2 access?

3 A. They -- there's a sign-up

4 area before they can get into the

5 site, and AAS gives them a password

6 after they've signed up and shown

7 that they have a dealer's license and

8 they check them out and make sure

9 they're a licensed dealer. It's

10 closed to dealer only.

11 Q. Okay. So the requirement

12 is that they be an authorized or a

13 licensed dealer in wherever they

14 operate?

15 A. Correct.

16 Q. And have whatever that

17 particular state requires for you to

18 sell used trucks?

19 A. Correct.

20 Q. And it's your understanding

21 that so long as information is

22 provided sufficient to satisfy you

23 that they have such a license, they

1425 FINANCIAL CENTER

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Case 3:06-cv-00638-SRW Document 20-2 Filed 02/13/2007 Page 9 of 22
NATIONAL COURT REPORTING

Page

546 Page

the termsMR.Object ofASBELL: the agreement to the that 1

they've form. agreed to specify how long 2

the(BYQ.auction MR. STARNES) or the bidding You takeprocess 3

will it down be open? and then tell whoever is the 4high person, MR. ASBELL: you're theObject high tobidder th5

for form.thisYou're unit? talking about the 6

agreement MR. that ASBELL: the dealer Objectenters to theinto 7

form. when they By take first itagree downtoyougetmean access-- 8

to the website. MR. STARNES: The website. 9

(BY Q.MR.MR. STARNES) STARNES: YouRight, said to 10the

website. you generally keep things viewable 11

(BYsevenQ.MR.toSTARNES) ten days? The same 12

Right. thingA. they've agreed if they agree to 13

Ipayassume Q.the asking that when price,thetheybidsget the 14

truck are closed, if they'rethe the thingfirst?is no longer 15

There's viewable? A. no time limit 16

specifiedMR.onASBELL: it. I'll object to 17

Okay. the Q.form. Does Volvo have a 18

policy that MR.determines Let STARNES: him how long a 19

object. bidding process You object remains and we'll open?get to 20

There's the A. facts. not a written 21

policy. MR. ASBELL: I just want to 22

Well, be sure Q.howthathasit'sit worked clear. When you23

Page

557 Page

over say take th itlast down, several youyears? mean -- 1

Seven A. toMR.tenSTARNES: days has been I withdraw 2

the general question.timeLet'sforjust the tryunitotogetbe 3

this viewable. -- this doesn't need to be 4

complicated. What Q. dictates taking it 5

off? (BYQ.MR. STARNES) You told 6

Whether A. me you keep it's hitting the bidding a fair process open 7

seven wholesale to tenmarket days?number or the 8

And number A.up to-- 30. And up to 30 9

Of if, you people Q. know, looking depending at it? on if, you10

No. knowA.There's -- I'll tell no you easy. Let's 11

consideration say the marketaken valuebyonthethenumber truck is 12

that 25, andhavewelooked have aatbidit. in there of 24, 13

You andQ.say maybe consideration, there's a couple are of other 14

you bids talking that areabout less than the prices that oryou're maybe 15

getting? 24 is the only one on there and it's 16

Right. beenA.out What theretheforwholesale a while. We'll17go

ahead marketandis bearing, hit the high the condition bid. All theof 18

the otherunitbidders and thearenumber rejectedof bids on 19

automatically the unit. and sent a reject 20

And notification Q.the waythat youtells closethema the 21price biddingthatprocess, the truckI take wasitsold fromatyour so 22

they previous can answer, track theismarket, you takewhat it down? we're 23

Case 3:06-cv-00638-SRW Document 20-2 Filed 02/13/2007 Page 10 of 22
NATIONAL COURT REPORTING

Page 66

68 Page

come market,in the on that wholesale truck? price, how 1

No,A. closethere's this isnot. to the wholesale price,2

those SO,Q.forfactors all he that knows, you've he'stold me 3

the earlier? only bidder, he's the high 4

bidder, Correct. A. or people have bid way over 5him, OnceQ.heyoujustdecide doesn't to close know? 6

theCorrect. A.bids, what happens next? 7

We ButA. Q.click if he onwants the tohightwobid.or 8

The thresystem days later, automatically despite hissends lackout of 9

the knowledge, acceptanceh can e-mail go and in andthemake 10

another rejection bid? e-mails. We log the sale 11Correct. in our A. system and print out the 12

Ifpaperwork hisQ.bid is tohigher, bill theI dealer. 13Okay. assume Q. I didn't it supersedes ak you his lower bid of 14

this: $23,000? Is this price that you offered 15

Correct. or accept A. deliverable at whatever16the

What location Q.if hisis;bidin other is lower? words, the 17

Itpurchaser willA. not allow is responsible him to dofor going18

and that. getting They have the truck the option and to pick 19

transporting up the phoneitand to wherever call us. they are 20

Okay. located? Q. But the website 21

wouldn'tMR. letASBELL: him makeObject a lowerto bid? the 22

No. form.A. 23

Page 67

Page 69

AsButis, A. Q.it where will allowis. them to 1

raise (BYQ.MR. theirSTARNES) bid? As is, 2

where Correct. A. is. All right. Go ahead. 3

Excuse As you Q. understand me. All right.it, does You send out 4

the acceptance/rejection agreement that thesee-mails. dealers, who 5

You havesend accessthetopaperwork the websiteto and the dealer bid on 6

trucks, who is therequire low that bidder, if youthenaccept you get 7

theirpaperwork bid, that they backinandturnclose provide the file 8you or iswith therethemore fundssteps? within a certain 9

There's amount A. aoflottime? of steps to 10

Yes,A. the --it does. you mean after we collect 11the

Ifunds mean, Q.fromit doesn't the person? allw 12

Yes. themQ.to renig on it? 13

Then No. A.we release the title 14

Okay. andQ.thenSo our thesepart bidsof come the file, we15

make in. Atsure someevery pointpiecen timeof document is it your is 16

decision in there that to sayweokay, needwe're and then goingweto 17

gopassahead the fileandonclose to deficiency, bids and accept 18

deficiency the high bidcollection. which is X? 19

Yes. Okay.A. Q. Are there occasions 20

Okay. whereQ. And trucksyou've do not toldsell meon this 21that websitewhatoryouare consider they all sold? in deciding 22

when toMR. closeASBELL: bids is Object based onto the the 23

Case 3:06-cv-00638-SRW Document 20-2 Filed 02/13/2007 Page 11 of 22
NATIONAL COURT REPORTING

Page 86

88 Page

that form.he appraised the truck? 1

That Correct. A.I don't know. That's 2

inAndtheQ.would repossession the location section. be 3reflected Okay. Q. Inspection, there on thethat'sfirst page 4

the Fairburn, amountGeorgia? charged by AAS to inspect 5

this Yes.A.truck? 6

Correct. Do Q.A. you recall what lot that 7isCleaning inQ.Fairburn? fee, what's that? 8That Yes.A.was That'sa clean Adesaand detail 9

that Fairburn. I had done at the auction. 10

That's Do you Q. andoauction that onyard? every 11

Right.A. truck youIt calls sell?it out in 12

No. moreA. detail right here (indicating). 13

Okay. I gotQ.you. WhyI didseeyouthatdonow. it on 14

this Okay.truck? And that's a place in the 15IfAtlanta I felt A. that areathethatclean you use to safe 16

and housedetail trucks? would help it, I might 17

Correct. haveA.had trouble selling it, I 18

All decided right. Q. toGoing cleanback and todetail it to 19

the makexhibit, it morewe're presentable. down to Bates 140. 20

Okay. It's Q.Exhibit And can 4. What you tell is 140? me 21

This or can A.is anweaccount find somewhere of what 22 that

other reconciliation fee is ofreport. $200? 23

Page 87

89 Page

Yes. Okay. A. Q.That What's is a itsmarshalling purpose 1

tofee.-- That means that I did not sell 2A. theIt's unit to detail through salesthepriceauction, and 3

they and nonrelated charged mesales a feefeesto just that hold were 4

spent it, keeponitthesafe.unit. 5

Okay. Basically Q. Let's a storage go overfeethis. is 6

what Underittheamounts sold toto?box, that's just 7

information Right. A. And that's on theonpurchaser, 142A is that 8

your is a copy understanding, of that bill. as far as the 9

All contact righ. Q. name We'll and get tocompany name, under10that.e soldBateso block 141, that up atappears the top?to be 11

Oh, a copy A. yeah, of sold another to, yes. account 12

All reconciliation right. Q. And report, the totalbut it's X'd 13

out? amount of those costs is $27,000, 14

Right. that'sA. theWe amount print thisthat TEC of 15California reconciliationpaidreport for thisat truck? different 16

Correct. timesA. through the process. I'm not 17

All sureright. Q.why Non we kill salestrees, but this one18

isrelated the only fees,important repo fee?one. 19

Correct. And A. Q.142 is another 20

Isreconciliation that Q. something report thatagain is with just 21

standard different numbers $700 or doonyouit involved know? with 22

the sameMR.truck; ASBELL: is thatObject correct?to the23

. ,w.··.,,',',', ,',

1425 FINANCIAL CENTER

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23 (Pages 86 to 89)

Case 3:06-cv-00638-SRW Document 20-2 Filed 02/13/2007 Page 12 of 22
NATIONAL COURT REPORTING

Page

166 Page 168

automatically next day, I accepted rejectedthat whenbid.you put 1

theAll Q.right. unit intoLookauction; over, this is that 2

correct? is just a new document for me, it's 3

the ThatA.last is not document correct. 128A. Can you4tell

meOkay. Q.what this is? 5ThisA.unit is a document was sold forentered 6

26,760. into the -- well, from our cash app. 7

department, Okay. Q. I see it's that.a wire I readreceipt for8a

transaction, that wrong. receipt You're of right. a wire. The first 9

Okay. bid Q.thatI understand was made onnow. 11/3 was 10accepted. (Whereupon, And if we Defendant's look over at-- 11

well, I'mExhibit tryingNumber to see if13there's was an 12e-mail acceptance marked for identification.) letter, but I do 13

All notright. Q.see one. Let'sIsgoit tocorrect, 14Mr. Exhibit Miller, 13.that It's weBatesknownumbers based on1 the 15

through entry on 25, thatandinspection it relatesreport to tractor and 16onserial thenumber website021. log-inYousheet maythat haveyouto 17

look ran this throughnit through here to tell auction me, onbut I 18notice November on page 10? 2 that you had $4,000 19chargedMR. on ASBELL: the reconciliation Which page report 20are

you to repairs? on? 21

Yes. (BY A. Q.MR. STARNES) I just 22

Can summarized Q.you tell metwowhat sheetsthosebased on what 23

1679 Page

for we'vewerealready for, first? looked at. I don't 1

Those haveA.thewerepages, for repairs but wethat looked at 2

an -- 3 were missed or light on the

appraiser's Correct. A. estimate. This unit had4

been -- inspection Q.crashedreport. at one time It and repaired 5indicated improperly,youandranI this madethingit right trough wit 6

the the auction purchaser, on November and that was10?a dollar 7

amount Correct. A. that we agreed on. 8

And All right. Q.so didWe'll that come websiteback 9

tolg-inthatsheet, in a minute. correct?Looking at the 10

Correct. inspection A. report on page 8 and 119,

The t Q.high inspection prce there was done was on October 12 7;what; is that what correct? was the offer? 13

Correct. 18,000. A. 14

And And Q.you he shows wouldn't on there take it? 15

Correct. reconditioning A. expenses needed 16of

SO$8,040? then Q. on either that day 17

Correct. or theA. next day you accepted this bid 18

GothattoQ.hadpagecome 19, the in onwebsite November 3rd for 19$26,760? log that shows the inspection on 20

Correct. A. October If7 you and ,look then atthat the unit21was

priced 111, it byshows Ms. aNelson sale date on October of 11/11.12? 22

Yes. So when A. I got back in the office the 23

"

Case 3:06-cv-00638-SRW Document 20-2 Filed 02/13/2007 Page 13 of 22
NATIONAL COURT REPORTING

Page

1720 Page

And I'mQ.going some tof need it's cutdocuments offl 1

but reflecting there'sthat. a noteAssuming there that you're we are 2

going unabletotocharge open hood or trytotocheck charge us 3

components. $410001 then ICan needyouto tell knowmewhowhatit 4

was that says? paid to and documentation 5

explaining Right. A. Thatwhy. is printed Is thisonsomething6

you're the inspection going tosheet give me? that's Can fromI the look 7

at appraiser. it? It is on 08 and 091 and 8

there Yes.A. And you'llthere find the shouldfull becomment. a 9

Where copyQ.ofisthat the invoice full comment? in this file. 10I

A. Inknowpublicwecomments. looked at it earlier. 11

It's still Q. MR. cut off. ASBELL: What Can we go12off

does the record? it say? 13

This.A.Okay. (Whereuponl We are unable a discussion14

to openwashoodheldandoffcheck the record.) components. 15

(BY ThisQ.MR. andSTARNES) oil leaks areGoing open items. 16

And backiftoyouthislook truckin number the inspectionl 0211 the 17

theyruck were soldl listed the purchaser as open. took 18

Open delivery Q.being? of the truck from the Adesa 19

That sitelA.itI take couldit?cost more. 20

Correct. All right. A. Q. So the unit was 21

What pricedQ.happens at $301000. next?The bids marked 22

The as viewable A. drive-awayon company the 12thl October 23

1713 Page

delivered 12th. Andthethenunitontopage the dealer. 18 it shows He 1

you've went outgotandthreeinspected bids. Thethe highest unitl and 2

coming he foundintheon damage October that 14 forwas$281000; previous 3

accident is that correct? damage that had been 4

That repaired A.is correct. but not repaired properly. 5

I

Andwent Q.youto closed the dealer the bids -- onl 6

according Weill Q.let meto page ask you201this: you closed the 7

Was bids onthisOctober damage14readilynd accepted visible? the 8

$28/000 It was A. visible. bid; is that correct? 9

That WouldA. Q.is itcorrect. have been visible 10

Nowl at theQ.youtimesaidthatsomething AAS did its 11

about inspection? paying $41000 back to the 12

Yesl purchaser. A.but we There don't ask arethem no documents in 13

toherecalldealing out repairs with that issue are already other 14

than completed. a $4,000Wefigure do askonthem a and I did 15

talk reconciliation to them about statement? missing this on 16

Right. the A. dashboard, The file was and then leading17to

already the otheronrepair it's wayworkto that disposition. they could 18

The havepurchaser noted thathadthispaidunitforhadthe unit 19

and previous had picked accidenti up. damage. And ifThat you was a 20

discussion want to havewiththisAASentered, and thethisnspector is my 21and e-mails theirandquality the photos manager. of the unit 22

SOwithyouQ.a copy went ofandthesawserial thisnumber. 23

Case 3:06-cv-00638-SRW Document 20-2 Filed 02/13/2007 Page 14 of 22
NATIONAL COURT REPORTING

Page 174

176 Page

truck SO Q.youyourself wrote --him a check? 1

Yes. Correct. A. 2

--Andand Q.youspoke say there to theis an 3

purchaser? invoice? 4

There Yes.A. is an invoice from 5

him. DidQ.youI cannot take these pay anything without 6

pictures? an invoice. 7

I

TodidA. Q.your not knowledge, take those 8pictures. Mr. Miller,Those what other picturesdocuments were taken 9

and besides sentthat to me, invoice and exists then Irelating went and 10

viewed in any way the tounitthisto $4,000 verify it.payment, 11any correspondence, (Whereupon, Defendant's anything related 12

to this other ExhibitthanNumber what 14you've was given 13

me, butmarked I'm talking for identification.) about -- 14

Just Thise-mail A. Q.the invoice. you gave me I 15marked(Whereupon, as Exhibit 14.Defendant's With the 16

picture Exhibit as attached Number to it,15itwas said, 17

"This ismarked the unitforweidentification.) talked about car 18

Okay. fax Q.shows Let'sgood g tohistory," Exhibit what is that 19

car 15. fax? This is Bates numbers 389 20Car through fax A. is409. if theItunit relates -- to tractor21

that's 738. We're primarilygoingfor tocars, change but ifgears 22there here, 738. was ever It looks a major like oncollision page that 390 23

1757 Page

that involved thereanwasinsurance $700 andcompany, other fees the 1

charged insuranceoncompany this account, wouldandhaveis thisagged 2

that one that serialyounumber. had detailed? 3

ItOkay. was, A. Q. Soyes,y'all it was rn a car 4

fax detail. report on this unit? Who ran a 5car AndQ.faxthat's report because on thisyouunit? 6

planned Dy A. attoCentral pu it inCarolina the auction? 7

ran Correct. A. a car fax. It is not uncommon 8

for Is that itQ.towhy not show you detailed up on a heavy duty 9

truck it? because they're not really in 10

Correct. the A. scope of the guidelines, but a 11

Itlotlooks ofQ.the, likeyoua page know,skips, the insurance 12

companies but if you look wouldat page report394it. this I don't 13appraisal believe thiswaswasdonerepaired on October by an 7; does 14that insurancepparcompany. to be correct? I believe this 15

Yes. wasA.repaired in-house. 16

What And Q.itother had $4,080 documents worthexist of 17

toestimated your knowledge reconditioning relatingexpenses? to this 18

Yes. payment? A. Did you actually write him 19

All a check? right. Q. Let's Had look he already over paid for 20

at thistheunit?log sheet, it's page 404. It 21Herflects had A. already the inspection paid forwethejust 22

talked unit, soabout we hadon toOctober -- 7, and it 23

(205)

174

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NATIONAL COURT REPORTING

Page

186 Page 188

have (BYQ.MR. an unusual STARNES) thing. TheSo let's go 1

ahead reconditioning and findestimate the inspection was $4855; report.is 2

that On page riht?548 -- you're right. This is 3

the Correct. A. original. 4

And (BYQ.MR. I don't STARNES) see an 548 it 5

acceptance shows that theletter, inspection but it appears was done on 6

from November page 558 8th; that is that thecorrect? bids -- well, 7

IYes. can't A. tell whether the bid was 8

accepted. AndQ.then itCan shows youontellpage me when 9that559 bid was that accepted, it was priced whatbydate? Ms. Nelson 10

November andA.put out30th. for bid on November 17; 11

All is that right. Q. correct? Now, looking at 12

Yes. pageA.543, the reconciliation report, 13

And thereQ.theis price a charge was of$35,OOO? $5,489 for 14

Yes. repairs. A. Is there anything in this15

And exhibit Q.thenother 558 than showsthisbidsmention on16

received page 543onabout 11/17those all therepairs? way through 17

No. 11/30, A. a total of five bids; is that 18

Docorrect? you Q. know anything about 19

That's thoseA. correct. repairs? 20

And Q.theMR. highASBELL: bid was Object to the21

form. received 25,250 on the 29th; is that 22

Icorrect? do A.not, but there was one 23

1897 Page

unit Correct. A.that had a transmission problem, 1

and Okay. Q.thisFirst, possibly the bids couldwere have been 2thestill, unit. even the one that was accepted 3

was (BYQ.MR. still some STARNES) $10,000Soless I'll than the 4

asking have toprice; comeisback thattocorrect? it. Assuming 5

this Yes.A.was the unit that had 6

transmission WhyQ.in this case problems, did youtell me what7you leaverecall the bids aboutopen, that. based on all the 8exhibits About A. thewe've transmission looked at before, a 9

good problems? deal longer than any other bids 10

Yeah. we Q.see?And ultimately 11paying MR. the guy ASBELL: $5,000Object for i. to the12

form. MR. ASBELL: Object to the 13

form. MR. STARNES: I'm trying 14to

(BYmarkQ.MR. something. STARNES)SoI mean, go ahead. I'll 15

just find tell it. me what you can remember 16

The about A. miles the aresituation lower that than led to that17the payment? rest of the units and the 18

One reconditioning A. of the G.F.isKelly on the low end, and 19sounits, it didn't whenfitheyinto,went you toknow, pick it up, 20

didn't it wouldn't fit intogothein twoaverage of theasgears, well, 21

and fourth that's why was wethe left firstitgear, out there I 22

for believe a little-- I'mbit. going by memory -- 23

Case 3:06-cv-00638-SRW Document 20-2 Filed 02/13/2007 Page 16 of 22
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Page 190

192 Page

thato findyouit could on here. startWeoutdidin.sayAndweit 1waserenoted dealingsomewhere, with 4764.andThere's w missed the 2

serial it. Butnumber I don't upknowhereif this on oneis theof these 3

things, unit or not. so that's obviously the 4

right Well, Q.--let'stell just me,assume this is three it 5was, pages,soBates if we numbers do come to560oneto that 560 --it 6

only is, wethisdon't tophave pagetoisgoBateshrough stamped, these 7questions but I guessagain. he's going You can't to Bates thinkstamp of 8any them.other reason for there to be a 9

(BY$5,000 Q.MR.payment STARNES) on Soany of these trucks 10anyway, other thanis thatis thetransmission repairs forproblem? the 11

Correct. transmission A. you were referring 12to,

Can Mr. Q.you Miller?think of any other 13

I'llpossibilities? have A. to look at it. 14

Correct, Yes,A.it is.and that's the 15

And dollarQ.your amount recollection that a transmission is 16

that repairthat wouldinvoice be inis too. dated when? 17

12/15. SOdoes Q.A. AAS not drive these 18

And trucks? Q.you had sold this unit 19

No, A. on November they do not.30th? 20

They Correct. A. Q.don't see if they'll 21

SOgoyour inQ.gear? recollection is 22

They're sometime A. supposed after youto sold checkit, you 23

1931 Page

that. received a call from the purchaser 1

saying DidQ.youthat go ittodidn't AAS and havetellall its 2them gears?to pay for this? 3

We Right. A.haveI had a working it -- I 4

relationship remember more with now themlooking that theyat this. will I 5give had itusverified the inspection by the auction for free if 6

they personnel, make andmistake. what happened was the 7

driver, $500? Q. the drive-away company driver 8showed Yes.A. up to pick this unit up, and9

Didhe could they Q. donothat drivein theis unit away.10So

case? they had to leave it at that time, 11Iand don't A.thenseethey that.towed the unit into12

their facility. MR. ASBELL: But beforeCanitwelft,go off 13

the I hadrecord? it verified, I had the 14

condition(Whereupon, verified by the a discussion auction. 15

It doeswas not state held off in here the record.) the problem16

to the transmission, (Whereupon, but Defendant's I do -- I 17

remember Exhibit the Number problem.19 was 18

WhyQ.wasmarked it rpaired for identification.) in 19Chicago?MR.First STARNES: off, 20let me see MR.ifASBELL: we can match Objectupto thethe 21

form. serial number somewhere. I'm sure 22

Theit's the Aprice . same was truck, fair. Ibut I'm trying 23

............. ........•.•

1425 FINANCIAL CENTER

1-800-638-3917 Birmingham, Alabama 35203 (205) 252-6205

49 (Pages 190 to 193)

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Page

1964 Page

don't 280, itknow showswhythatit was you priced repairedthein 1

Chicago. unit and put I just it upsaidforthat bid Ionwould October 2

cover 14 at athepricebill.ofI $31,000; didn't cover is that the 3

towing right? it in, so I don't really care 4

where Yes.A. it was repaired at. 5

And (BYQ.MR. you STARNES) received a bidIs this that 6

date all thefordocumentation that amount, and that they you had 7accepted reflecting it; thisiswork? that correct? 8

AsOnfar A. 279asthere's I knowthree but Ibids 9didn't in there-- on the 14th, and, yes, 10

SO31,000. theQ. only thing you based 11And it onQ.youis youaccepted have anit onestimate that to 12

date replaceaccording transmission to -- 5,489.45, and 13

Yes. youA.paid it? 14Correct.

-- page Q. 281? 15

Yes. YouA.didn't get any repair 16

Itbillsappears Q.to showonthey this exhibit actually have paid 17

thisat money we got ora bunch anythingof duplicates, like that? 18

but rather MR.than ASBELL: figuringObject that tout,the19

form. I'll just leave it as it is. I think 20

This it's A. copied was nottwice, from clips -- theon either 21

side, purchasernd Iwas thinkR&Jit got Truckcopied Sales, twoand 22timeshey'reandoutstamped of Michigan, twice.and the 23

195 Page 197

repair bill 21 iswhich from relates Pozzo into Illinois truck 1

or number theepair 584, estimate. and it's Bates I generally 410 2

through do not payout 446. for an estimate. 3

SOthere Q. (Whereupon, may be otherDefendant's 4

documents? Exhibit Number 21 was 5

A. It's possible. markedThefor average identification.) 6

transmission Looks Q. like if you was look $6500at to 9,000, but 7

65pageis the 415lowcanone, you tell so I'mmegood whenwithit was 8

5,439. inspected and what the estimated 9

reconditioning (Whereupon, was? Defendant's 10

10/24, A. $4,580. Exhibit Number 20 was 11

And Q.there's marked a logforsheet idntification.) 12All transaction right. Q. Let'slogmove on 426. on. It shows13

The that next you priced truck isthetruckunitnumber at $26,000 762 14

and it's Exhibit put it out 20. forIt appears bid on November to be 15

3rd? Bates numbers 266 through 303. The 16

Correct. inspection A. is 271. Mr. Miller, was 17

And itone Q.thenonbidsOctober were 7? 18

Yes. reflected A. on page 425; is that 19

Itcorrect? shows Q. estimated 20

That recondition A.is correct. and expenses $4940? 21

$4,940, SoldQ.theyes. unit for $24,OOO? 22

Correct. ThenA. Q.if we look at page 23

,",

Case 3:06-cv-00638-SRW Document 20-2 Filed 02/13/2007 Page 18 of 22
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Page 198

200 Page

others? All Q.right. What I'm confused. dictated that, what 1

condition Look at page of the435.truckIs this or mileage a document or 2

that's what? just out of place? 3

The Yes.A.combination The serial number of the 4doesn't mileage,match. the condition, The serial andnumber the 5

specifications 341953. on the unit. 6

All But,Q.right. generally See ifspeaking, you 7

can was --it we'll high miles, pul these. low miles, That what? 8

belongs Well,A. it would to another havetruck? been 9

Isthethat A. combination the one thatof we're them all, because 10

this msing. one right here has 9,470. So I 11

No, wasQ.I preparing don't thinkthat we'reone to go through 12

the missing auctionit. Ibecause think it'sthat's an exhibit a rougher 13weunit.haven't gotten to yet. Look 14

SOthrough theQ. rougher here andtheseeunit,when it changes 15tohe53more if welikely can you real were quick,to put it 16

through M. Miller.theI auction? believe it changes on 17

Correct. pageA.433. If you look at the pages 18

The immediately Q.higher thepreceding miles, thethat, they all 19

relate more reconditioning to what we've and beenexpenses? talking 20

That's about, A. generally. 5847 21

Yes. And Q.if we look here at 209, 22

But the then Q.inspection on 433,report, they start i was 23

199 Page 201

talking inspectedabout on October this serial7th?number 953. 1SoCorrect. I'mA. going to remove pages 433 2through AndQ.what446wasontheExhibit estimated 21. There's 3

noreconditioning need to haveexpense? a bunch of -- and 4we'll $9,470. A.hold these. I think we'll find 5

theAndQ.exhibit, if we gobutthrough they maybe here, 6

we'll dupicative. find the log on page 220. Ms. 7Nelson (Whereupon, priced the unitDefendant's at $30,000 8

five daysExhibit later Number on October 22 was 12th; is 9

that correct? marked for identification.) 10

Correct. All right. A. Q. 22 is Bates 11

All numbers right. Q. And 204 through then two225, and it 12

days relateslater to VINyou number reduced989. it downThisto 13truck $23,000hasanda $500 put itreconditioning out for bid; is 14detail that correct? fee. Why is that? 15

Because A. Correct. A. I was going to run 16

And it through Q.tell methewhyauction you didor I didn't -- 17well, that. I didn't run it through because 18

Tothere's put A. itamore $200infee, linemarshalling with fee. 19

Again, whereQ. why the unit did you shouldselect sell. 20And to have Q.yourcertain belief --

trucks I mean, reconditioned 21

or Ms.detailed Nelson because is trainedyoulikewere you. going Why to 22

was run themrs, through in your judgment, the auctionhigh andsonot 23

(205)

198

Case 3:06-cv-00638-SRW Document 20-2 Filed 02/13/2007 Page 19 of 22
NATIONAL COURT REPORTING

Page 206

1 that I felt that I'd like to try at

2 the auction.

3 Q. Well, you told me earlier

4 that generally it was high miles,

5 high conditioning expenses, rough

6 condition?

7 A. Right. But I also don't

8 want to be known at the auction for

9 just selling my junk. So I might

10 pick a nicer one or --

11 Q. All right. The transaction

12 log is on page 205, and it shows that

13 the truck was, after the inspection

14 on the 7th, no transactions occurred

15 until the 27th when you priced it for

16 $44,000; is that correct, page 463?

17 A. That's correct.

18 Q. And, again, other than

19 possible getting the title or a

20 notice issue, would you have any

21 explanation for the 20-day delay?

22 MR. ASBELL: Object to the

23 form.

Page 208

1 authorization to pay it. This was

2 after the sale.

3 Q. The sale occurred on the

4 31st, October 31st; is that right?

5 A. Yes.

6 (Whereupon, Defendant's

7 Exhibit Number 24 was

8 marked for identification.)

9 Q. I will mark as Exhibit 24

10 the cover pages. It's Bates numbers

11 563 through 566. The invoice is

12 dated March 2nd, and then there is a

13 more detailed three-page invoice

14 behind it. It's dated February 16th.

15 A. And on that repair, I did

16 not want the Volvo dealer to do it in

17 their shop. I asked for Cummins to

18 inspect the unit, and they brought it

19 over to Cummins.

20 Q. SOCummins actually did the

21 repairs?

22 A. Yes.

23 Q. Did you ask somebody for an

209 Page 207 Page

opinion I doA.not.as to when this head gasket1

blew? (BYQ.MR. STARNES) So you 2

put it out MR.for Object ASBELL: bids,toandtheyou got 3

three form. bids; is that right? 4

That No.A.is correct. 5

And (BYQ.MR. the bidSTARNES) on October So you 31 6

for don't$39,300, know whether you accepted it was it?blown at 7

the Correct. A. time of sale or blew sometime 8

between Now, Q. if youthe look timeatit page was sold and 9

448, February in addition the 15thto orthese16th?otherIt'sfees, hard 10

for we'vemetalked to read. about detailing it -- 11

That's andA.thiscorrect. never went to the auction, 12

And by theQ.youway, woulddidcertainly it, this truck? 13

A. Itagree neverthat wentheadthrough gasketsthecould blow14

anytime? auction. 15

Correct. Right. A. Q. There's a $2,880.10 16

for repairs MR. Object onASBELL: thetoreconciliation the 17

form. sheet on page 448. Can you explain 18

(BYthatQ.MR. to me, STARNES) please, But you sir? 19

Okay. choseA. This to payunitthis?had a bad 20

Correct. headA.gasket and it was allowing 21

This coolant Q.is Volvo to goandintoGMC the oil, of and I 22

Charlotte. have the repair Is thatbackup, somebody and my you do 23

Case 3:06-cv-00638-SRW Document 20-2 Filed 02/13/2007 Page 20 of 22
NATIONAL COURT REPORTING

Page 220

A. Yes.

MR. ASBELL: Object to the

1

2

3 form.

4 Q. (BY MR. STARNES) And then

5 on 10/27, it looks like page 92, you

6 received two bids?

7 A. What was the --

8 Q. 92?

9 A. Yes.

10 Q. And the bid you accepted on

11 the same day you put it out was for

12 $37,000?

13 A. Yes.

14 Q. Why did you not leave the

15 bids open longer?

16 A. That was a price that was

17 in line with the target number that

18 we're trying to go for and within the

19 average of what that truck was

20 selling for.

21 Q. Are you familiar with The

22 Ed Schmidt, S-C-H-M-I-D-T, Truck

23 Store?

Page 218

1 N.A.DA base or a NAD.A. with all

2 adds and no deducts. That's where

3 that number came from.

4 Q. The bid list is on page

5 195. It appears that you received

6 three bids on this unit; is that

7 right?

8 A. Yes.

9 Q. And you accepted a bid of

10 $38,000?

11 A. Correct.

12 Q. Okay. And it was accepted

13 on October 31st?

14 A. It was placed on -- oh,

15 yeah, placed on 10/27, accepted on --

16 Q. On the 31st. Look at 197.

17 A. Yes.

18 (Whereupon, Defendant's

19 Exhibit Number 28 was

20 marked for identification.)

21 Q. Here's the last truck

22 number. It's Exhibit 28, 76 through

23 102, and it's truck number 959. We

Page 221

A. Yes.

Q. Are they one of your top

customers?

MR. ASBELL: Object to the

1

2

3

4

5 form.

6 A. They are.

7 Q. (BY MR. STARNES) You can

8 answer.

9 A. They are.

10 Q. Would the same be true for,

11 is it TEC of California, or do you

12 call them T-E-C?

13 A. We call them TEe.

14 Q. Are they one of your top

15 customers also?

16 MR. ASBELL: Object to the

17 form. Do you mean someone that just

18 frequently buys?

19 MR. STARNES: He described

20 Charlotte Volvo and GMCof Charlotte

21 as one of his top ten customers.

22 A. In 2005 they were.

23 Q. (BY MR. STARNES) TEC was?

Page 219

1 had an earlier misplacement of an

2 acceptance notice that was in an

3 earlier exhibit that relates to this

4 truck, so I'm going to insert it into

5 Exhibit 28, and it's Bates number 72.

6 It will be at the back of this

7 exhibit, the tail end of it, and I

8 say it's one of those acceptance

9 e-mails. All right. The inspection

10 was done on this truck when,

11 Mr. Miller?

12 A. 10/7 and the reconditioning

13 on it was $8,200.

14 Q. Okay. And then under the

15 transaction log it appears that you

16 priced this truck at $40,000 on

17 10/277

18 A. Correct.

19 Q. Again it's got a $46,300

20 credit comment. Would your answer be

21 the same as far as the basis for that

22 number that you gave me just

23 previous?

(205) 252-6205

218 to 221)

Case 3:06-cv-00638-SRW Document 20-2 Filed 02/13/2007 Page 21 of 22
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Page 230

232 Page

transmission and lease truckis operable? other than Volvo? 1

Yes, Correct. A.we do. 2

SOCheck would Q. theyoulights? say you deal 3

A. with I don'tpretty thinkmuch they all check makes and models 4

of lights. trucks -- 5

Yes, What A. Q.I else do. are they supposed 6

to-- doinQ.terms that requires of reselling something more 7

them? than visually looking like start the 8

engine Yes.A. to see if the transmission is 9Back operable? Q.in 2005,What werelsethereare they to do 10toanyseeparticular if something things,works specsorinnot? 11They trucks, A.dothat a visual these tractors either12

had inspection, or didn'tcheck haveforthatoilmade leaks them and 13

anything more or less thatmarketable? would detract from the 14

The valueA. unitsof thewereunit. -- these 15

Okay. unitsQ.were But asbasic far fleet as spec units.16

They anythingwerethat 610swould and require 670s -- them 660s, to 17

doexcuse something me, which morearethankindlook, of awefleetknow18

they spec have truck.toThey visuallyweregoonturnthethelowkeyend 19

of to the starthorsepower. the engine? It was a generic 20

Correct. fleetA.truck. 21

They WouldQ.have you toagree operate that the the 22gear fall ofshift 2005, to the see used if thetruck transmission market 23

231 Page 233

was is operable? a seller's market? 1

Correct. A. MR. ASBELL: Object to the2

form. What Q.else You would can answer they beit if you have3

anrequired opinion. to do that requires them to 4take TheA.market some action, was pretty if theregoodis 5

anything? at that time. 6

AsideA. fromMR. the STARNES: visual That's all I 7

inspection? have. Thank you, sir. 8

Right. Q. MR. ASBELL: I have no 9

There's questions. A. not a deeper 10mechanical inspection that they do. 11

SOFURTHER doQ.they inTHEany DEPONENT way check SAITH12 NOT

the electronics, for instance? 13

Well,A.when they start the 14

unit, they verify voltage and that 15

everything is working. 16

Okay.Q. 17

There's A. a driver 18

information center in the trucks too 19

that self-diagnose. So if there's a 20

problem, it shows up like 21

immediately. 22DoesQ.your company finance 23

1425 FINANCIAL CENTER

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59 (Pages 230 to 233)

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tvolvo / I L---) /"/V (' (/ - "'-1, I/i' V( ~ L/ 1/ if:J

(-- / .::> C( rt::

Contract Make NADA Model Mileage Safe %Safeof Wholesale Year Price Number Target Type VINi ReconTarget Est. $

$ 29,640.00 4,035.00 VNL64T-610 S77387 4V4NC9RH61N32S013 $ 25,605.00 2001 Volvo$ 27,000.00 105.45% Internet

29,075.00 7,930.00 VNL64T-610 509728 4V4NC9RH81 $21,145.00 $$ 2001 Volvo N325014 $ 31,000.00 146.61% Internet

31,S95.05 VNL64T-610 353198 105.50% 4V4NC9RHX1N325015 $$ 2001 Internet 6,950.00 Volvo$ $26,000.00 24,645.05

32,932.00 VNL64T-610 481707 4V4NC9RH11N32S016 $$ 2001 11,295.00 Volvo $21,637.00 $ 23,000.00 106.30% Internet

29,975.00 VNL64T-610 619323 4V4NC9RH31N32S017 $23,425.00 $$ 2001 6,S50.OO 106.72% Volvo$ 2S,000.00 Internet32,234.10 VNL64T-610 527636 4V4NC9TH41N325018 $$.2001 8,340.00 Volvo $23,894.10 $ 21,000.00 87.89% Auction33,424.50 VNL64T-610 516020 4V4NC9TH61N325019 $$ 2001 6,200.00 Volvo $ 27,224.50 $ 24,000.00 88.16% Internet

8,730.00 36,825.00 VNL64T-610 490370 $28,095.00 $$4V4NC9TH02N325020 2002 Volvo$ 26,760.00 95.25% Internet

8,055.00 $ $40,574.56 32,519.56 VNL64T-610 4181364V4NC9TH22N325021 $ $2002 28,000.00 Volvo 86.10% Internet

27,250.00 VNL64T-660 4089284V4ND4RJ9YN246738 $$ 2000 4,140.00 Volvo $23,110.00 $ 22,000.00 9S.20% Internet

21,896.80 VNL64T-660 706128 4V4ND4RJOYN246739 $$ 2000 5,935.00 Volvo $15,961.80 $ 22,500.00 140.96% Auction

$ 36,350.98 6,300.00 VNL64T-610 398961 4V4NC9JH01N314763 $30,050.98 $ 2001 Volvo$ 31,100.00 103.49% Internet

$ 4,855.00 34,808.88 VNL64T-610 424645 84.30% 4V4NC9JH21N314764 $$29,953.88 $2001 Internet 25,250.00 Volvo

36,701.15 VNL64T-610 384954 4V4NC9JH91 $$ 2001 4,970.00 N314762 Volvo $31,731.15 $ 31,000.00 97.70% Internet

23,146.80 VNL64T-660 402942 4V4ND4JH2YN793584 $$ 2000 4,640.00 Volvo $18,506.80 $ 24,000.00 129.68% Internet

27,250.00 VNL64T-660 398958 4V4ND4RJOYN796989 $$ 2000 9,485.00 Volvo $17,765.00 $ 23,000.00 129.47% Internet

4V4NC9TJ33N341958 45,700.00 VNL64T·610 386311 $$ 2003 4,960.00 Volvo $40,740.00 $ 39,300.00 96.47% Internet4V4NC9TJ63N341954 46,361.96 VNL64T-610 343451 95.86%$$ 2003 Internet 2,235.00 Volvo$ $44,126.96 42,300.004V4NC9TJ43N3419S3 45,700.00 VNL64T-610 365071 $$ 2003 4,700.00 Volvo $41,000.00 $ 40,300.00 98.29% Internet

4V4NC9TJ23N341952 45,700.00 VNL64T-610 389877 $$ 2003 7,265.00 Volvo $38,435.00 $ 38,000.00 98.87% Internet

4V4NC9TJ53N341 959 45,769.88 VNL64T-610 358253 98.48%$$ 2003 Internet 8,200.00 Volvo$ $37,000.00 37,569.88

104.61%

VFS Leasing v. G.'

Plaintiffs' p 00

Doc. Prod.

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Case 3:06-cv-00638-SRW Document 20-4 Filed 02/13/2007 Page 1 of 1
IN THE UNITED STATES DISTRICT COURT FOR THE

MIDDLE DISTRICT OF ALABAMA

VFS LEASING CO., )

)

PLAINTIFF, )

) CIVIL ACTION NO.: 3:06CV638-SRW

VS. )

)

G. F. KELLY, INC d/b/a KELLY )

TRUCKING; and GUY KELLY, ) 

)

DEFENDANTS. )

AFFIDAVIT OF GUY KELLY

STATE OF ALABAMA

COUNTY OF RANDOLPH

Before me, the undersigned authority in and for said state and county personally appeared

Guy Kelly who, after being duly sworn, deposes and says as follows:

1. My name is Guy Kelly and I am president of GF Kelly, Inc. (“Kelly Trucking”). I

have been in the trucking business since 1985 and started Kelly Trucking in 1990.

2. I am familiar with over-the-road trucks and the buying, repairing and selling of

same. I am very familiar with the 21 trucks at issue in this case as I was the person who bought

the trucks and was responsible for overseeing them during the time they were owned by Kelly

Trucking. I am also very familiar with the condition of the trucks at the time they were

repossessed by Volvo.

3. I have reviewed the deposition of Kevin Miller, exhibits to that deposition, and

the affidavit of Charles Lance. I have also reviewed the Motion for Summary Judgment filed by

Volvo.

4. Based on my knowledge of and experience in the trucking industry, it is my

opinion that Volvo is attempting to charge Kelly Trucking excessive amounts for repossession

expense, inspection fees, and detailing fees. The fees which Volvo requests the court to award

are excessive and unreasonable. These fees are not in keeping with the standard in the industry

in 2005.

5. Additionally, based on my knowledge and experience in the industry, it is my

opinion that Volvo did not resell the trucks following repossession in a commercially reasonable

manner and in keeping with the standard in the industry.

6. Volvo is requesting that it be awarded $700.00 in repossession expense for each

of the 21 trucks. This amount is ridiculously excessive and unreasonable. When it became

apparent that Kelly Trucking could not make the required lease payments on the trucks due to

unforeseen circumstances, I worked with Volvo to make the repossession simple and efficient. 

All 21 trucks were brought to the Kelly Trucking yard in Wadley, Alabama and Volvo was

Case 3:06-cv-00638-SRW Document 20-5 Filed 02/13/2007 Page 1 of 6
notified as the trucks arrived in the yard. Volvo then sent drivers to Wadley who drove the

trucks 75 miles to the Adesa yard in Fairburn, Georgia. The distance between the Kelly Trucking

yard and the Adesa yard is less than 75 miles. At the time of this repossession, the standard

mileage rate to pay drivers would be 35 cents per mile round-trip. For a 150-mile round-trip, the

total cost for each truck would be $51.50. The total mileage charge for all trucks would be

$1,081.50. To cover additional costs, the maximum reasonable amount of repossession expenses

under these circumstances would be $200.00 per truck. If a commercially reasonable charge of

$200.00 had been claimed by Volvo, Kelly would be charged $4,200.00 rather than $14,700.00. 

This is a difference of $10,500.00. This is the amount that Kelly should not be charged by

Volvo.

7. Volvo claims it is due to be reimbursed an inspection fee of $300.00 on each

truck. The total amount Volvo is claiming for these inspections is $6,300.00. I have reviewed

the inspection reports and have determined the type and amount of work that went into to

performing these inspections. I have also reviewed the deposition of Miller where he describes

these inspections. The charge of $300.00 is unreasonable and excessive based on my experience

and the standard in the industry. The maximum amount that would be reasonable for an

inspection under these circumstances is $125.00 per truck, which would result in a total charge of

$1,675.00. This results in a difference of $4,625.00. Kelly Trucking should not be charged with

this amount that Volvo is claiming.

8. Volvo is claiming that it is entitled to $500.00 each for detailing 8 of the

21 trucks. The total detailing expense being claimed is $4,000.00. This amount is clearly

excessive. It is the standard in the industry for a used truck to be cleaned and detailed prior to

putting it on the market for sale. However, $500.00 is a greatly excessive price for this. 

Detailing of trucks is done in my shop every day. In 2005 the reasonable charge for detailing a

truck of this type was $125.00. Thus, Volvo should only be entitled to a total of $1,000.00 for

detailing 8 trucks, not $4,000.00. Kelly Trucking does not owe Volvo the difference of

$3,000.00.

9. Each inspection report contains an estimate of expenses associated with bringing

the truck up to a wholesale condition. It is the standard in the industry to sell trucks in a

wholesale condition. As stated in the affidavit of Charles Lance, the reconditioning expenses

shown in the 21 appraisal reports are greatly excessive. As an employee of Kelly Trucking for

many years, Mr. Lance is very familiar with the reasonable cost associated with repairs such as

those shown in these appraisal reports. The reasonable amounts of these repairs are shown in the

chart which is a part of his affidavit that I have reviewed. By including greatly excessive

reconditioning expenses in the information available to prospective bidders, Volvo drew a very

unrepresentative picture of the value of the truck. Obviously a truck that needs $8,000.00 in

reconditioning is less valuable than a truck that needs $3,000.00 in reconditioning. However,

Volvo consistently with all 21 trucks showed an amount of reconditioning expenses that was

excessive. Had the actual real-world cost of the reconditioning been shown in the appraisal

reports, prospective buyers would have had a much more representative picture of the true value

of the trucks. This would have resulted in higher bids and greater sale prices. Posting excessive

reconditioning expenses was not commercially reasonable and in keeping with industry

standards.

10. The testimony of Kevin Miller, remarketing manager for Volvo, clearly shows

that Volvo either has no policy relating to getting maximum sale prices on repossessed trucks or

has a policy that can be violated when convenient. For instance, Miller testified that a highmileage truck in poor condition would be put through the auction rather than put out for bids on

the Volvo web site. However, the records on the 21 trucks reflected on two occasions that trucks

were put in the auction that were low-mileage and good-condition trucks. When asked to explain

this discrepancy, Miller simply said that Volvo did not always want to put junk at the auctions so

Case 3:06-cv-00638-SRW Document 20-5 Filed 02/13/2007 Page 2 of 6
sometimes they put better-condition trucks in the auction. Another example of Volvo’s

inconsistency is that Miller testified that Volvo sells repossessed trucks “is-as, where-is.” 

However, there were three occasions in this case where Volvo paid substantial amounts of money

to purchasers after the deal was closed and the purchase made. This is a clear violation of “as-is,

where-is” policy and is not commercially reasonable

11. Kevin Miller testified that Volvo puts a sale price on the web page for each truck

it put on the market. He testified that the sale price posted on the Internet would be $3,000.00-

$5,000.00 more than maximum wholesale value. However, on at least 18 of the 21 trucks, the

posted sale price was greatly less than that amount. This again clearly shows that Volvo has no

policy regarding disposal of repossessed trucks or does not consistently apply a policy.

12. I have knowledge that it is the standard on web sites of other manufacturers and

auction companies to allow prospective bidders to see bids previously placed. Additionally, once

bids on a particular truck are opened, the web site specifically states the time and date on when

the auction closes. That is the standard and is what is commercially reasonable in my opinion. 

However, on Volvo’s web site, bidders do not have access to the amount of previous bids. This

is not commercially reasonable. A bidder is much more likely to lowball. Also, someone who is

outbid is not aware of that fact and thus does not know he needs to redid. That is my opinion

which is based on my experience. Additionally, an auction on the Volvo web site can last from

1 hour to 30 days. The date and time an auction on a particular truck is closed is solely up to

Volvo. The auction on 16 of the 21 trucks lasted 4 or fewer days. The maximum time for any

auction was 14 days and only one other lasted 7 days. Twelve auctions remained open for

48 hours or less. In my opinion this is commercially unreasonable.

13. Three trucks were sold to Volvo & GMC of Charlotte. According to Mr. Miller,

this dealer is one of Volvo’s top ten customers for used trucks. In all three auctions where this

dealer was the high bidder, the auction was closed immediately after receipt of this dealer’s bid. 

Even though the auction on all three trucks had been active, Volvo chose to close the auction as

soon as this top dealer gave a higher bid. This is extremely suspicious and in my opinion is not

commercially reasonable. As will be stated below, the sales price on all three of these trucks was

more than $30,000.00 lower than the true value of the trucks.. Five trucks were sold to Ed

Schmidt Trucks, another top 10 customer according to Mr. Miller. Four of the auctions were

open for less than 48 hours and were closed as soon as Schmidt was the low bidder. Closing

auctions so quickly for the benefit of one dealer is not commercially reasonable. The trucks were

sold to Schmidt for more than $30,000.00 less than their value.

PURCHASES BY TOP 10 CUSTOMERS

Customer GFK Truck No. Serial No. (Last 3) Days Bids Open Bids

Ed Schmidt Trucks 103 015 1 2

108 019 2 2

190 763 4 3

249 952 2 3

244 959 1 2

Volvo of Charlotte 243 958 4 3

242 954 4 4

241 953 4 4

Case 3:06-cv-00638-SRW Document 20-5 Filed 02/13/2007 Page 3 of 6
14. The standard in the industry is that a truck sold at auction, whether it be a live auction or

an internet auction, is sold “as-is, where-is.” According to Miller, this is also Volvo’s policy. A

bidder has the opportunity to determine the condition of the truck based on what is posted on the

web site and also has the opportunity to visually inspect the truck at wherever it is located. Once

the sales price is paid by the low bidder and the title is passed, the truck is owned by the low

bidder and he takes the truck in an “as-is” condition. However, Volvo is attempting to charge

Kelly Trucking $12,369.10 it had paid to three purchasers after the sale was closed. Volvo paid

$4,000.00 on Kelly Truck No. 110; $5,489.00 on Kelly Truck No. 192; and $2,880.10 on Kelly

Truck No. 243. According to Mr. Miller, the problems with these trucks were easily discoverable

by both the bidder and the inspection company hired by Volvo. These payouts are not in keeping

with industry standards and are commercially unreasonable. Kelly Trucking should not be

charged for the amount of these payments. Documents produced by Volvo showing that these

payments were made long after the trucks were sold “as is” are attached (“Volvo Repair Docs).

15. Attached to this affidavit is a Resale Summary chart which has been prepared

utilizing Volvo documents. The first column shows the Kelly truck number; the second column

shows the last digits of the truck serial number; the third column shows the number of days bids

were open on the web site; the fourth column shows the number of bids received on the truck;

column five shows the commercially reasonable value of the truck after all deducts for necessary

repairs and other expenses and that value is further discounted; column six shows the price

Volvo sold the truck for; and column seven shows the difference between what the reasonable

amount Volvo should have received for the truck and the amount Volvo actually received. The

total difference for the 12 trucks included in the chart is $101,810.00. It is my opinion that this is

the additional amount Volvo would have received had it conducted the reselling of these trucks

in a commercially reasonable manner. The 8 trucks sold to the two top dealers described above

are included in this chart and the loss on those trucks alone amounts to more than $60,000.00.

 16. The values shown in the fifth column are my opinion of what the trucks would

have sold for had they been sold in a commercially reasonable manner. These values take into

consideration the legitimate reconditioning expenses, the mileage, and make and model. These

values were further discounted at least 10 percent, even though, as Mr Miller stated, it was a

seller’s market at the time these trucks were sold.

17. There are many other costs and charges which Volvo is attempting to place on me

and my company which are not legitimate and are excessive and unreasonable. The defendants

are entitled to present evidence of all the unreasonable charges to the Court so that the Court can

determine the amount that is due Volvo in this case. Volvo is not entitled to an amount close to

what it is claiming in its motion for summary judgment. 

Case 3:06-cv-00638-SRW Document 20-5 Filed 02/13/2007 Page 4 of 6
RESALE SUMMARY

GFK

Truck No.

Serial No.

(Last 3)

Days Bids

Open

Bids Value Sale Price Difference

103 015 1 2 $32,000 $27,000 $5,000

107 018 7 2 $32,000 $21000 $11,000

108 019 2 2 $32,000 $24,000 $8,000

109 020 6 3 $36,000 $26,670 $9,330

110 021 2 3 $38,000 $28,000 $10,000

169 739 Not

Available 

Not

Available

$27,000 $22,000 $5,000

192 764 14 5 $34,000 $25,520 $8,480

243 958 4 3 $51,000 $38,000 $13,000

242 954 4 4 $52,000 $40,300 $11,700

241 953 4 4 $51,000 $42,300 $8,700

240 952 2 3 $49,000 $39,300 $9,700

244 959 1 2 $49,000 $37,000 $12,000

TOTAL $101,810

Case 3:06-cv-00638-SRW Document 20-5 Filed 02/13/2007 Page 5 of 6
/s/ Guy Kelly 

Guy Kelly

 SWORN TO AND SUBSCRIBED BEFORE ME this the 12th day of February, 2007

/s/ Kathleen W. Newman 

Notary Public

My Commission Expires: 2/19/2007

Case 3:06-cv-00638-SRW Document 20-5 Filed 02/13/2007 Page 6 of 6
1

J

f

Central Carolina Trucks, Inc

306 Pinev;ew Drive Kernersville, NC 27284

Watts: 800-672-4201 Lo(~: 336-993··2106

Fax: 336~993-8465

u~edtrut~k~~centra1cal"o]inatruclc;s.com

Invoice NOl 3842-33106 "', ' "\

!)("',':~;~

3/3112006

INVOICE ~

Custo~r

Name

Address

City

Phone

Volvo Commercial Finance LLC The Americas

KeVin Miiie-r _.' Debra Nelson ..d· •• --. ---

7823 National Service Road ...•" •. .__ ."--

'''Greensboro '-~-~ .....- State"NC zjp- 27409-·----

-3~:93"1-4~t.~8··=~!=_~~.:93r414~ ..::--=-===

Date

Used Truck #

VIN

Description

Ref

313112006

_ ..," 3842 .--

---.. 325021-- .-- 026iir--'

·"-·-v5i.Vo--·'

.__ .......••__ .,-

Unit Price

$4,000.00

. '''---'$0.00

=- ~,qQiioo -'$4.,000.00'

$0.00

"'''---$6:00

--' -----$0,00

'$0.00

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-.-----.' - ---..-----.-. $0.00 .... ~. $0.00

-. ···------- .. $0.00

--'TOTAL

SubTotal

Shipping & Handling

Taxes state

Repair body work around cab of truck that had been done

before incorrectly that was not noted on condition report

c;£.U

\c. \~ U;;) fl$.\ ~fR't,;J D'E.'\\\ "eJ \j Mt .~\J Thank You Danny ,~~\J1'

.-._. _

Payment

,,,, __

Details

'''__kJ~_

o Cash

@ Check

o Credit Card

tabblaName -'"- .-..'.~" ._------ .•.._~---_.. ------- CC#

.-----..EXpires----·.. ._----.--- Internal Office US4! Only

Credit Account Credit2302L Account Unit 38426102l

$4 000.00

Credit Account 90522

Thank You For Your Business J!I VFS Leasing v. G.F. Kelly

Plaintiffs' P 000567 Doc. Prod.

Visit Us On The Web at: www.centralcarolinatrllcks.com.

Case 3:06-cv-00638-SRW Document 20-6 Filed 02/13/2007 Page 1 of 5
02/20/2008 10'18 FAX 7045970043 VOLVO & GMC TRUCK eTR I4l 001/003

P~00V'OO3'

c Cummine

Atlantic

Inc:.

MA'j"'ERIA.L RSTUFlNElP FOR CM1crr OR EXCHANGE"UST

SHOW THIS INVOIce NUMBER. AL/.. fMTEAW- RE1"URNEO

fOR CREOIT SUElJeCT TO 1h HANtlLtNG oHARQ!:, OLD

UNITS EUGISLE! FOR EXCHANGE MUST BE RECEIVED

Wm-fIN 30 CAYS. f'EOERAL 1lJt!56-094£11112

CHARLonE

3100 JEFF ADAMS OR,

CHARLOTTE, NC 28200-

(70<4 )5987690

1i'!IJOICL NO

hlWR'TO: P,O. BOIlIC111'

Ch/n'IQlla, He Zo:zqo.1771

~JbLm

VOLVO & GMC TRKS CAROLINA

P.O, BOX 550007

CHARLOTTE, NO 28258-

2WtieR

VOLVO & GMC TRKS CAAOllNA

P.o, SOX SeOOO7

CHARLOlTe, NO 28258-

pAGE 10F 3

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•.. i"4'. "&0" PU."IIlQ, AQ.U"MIlIIT IllAK~ 

16-FEf.l.2008

Is')( 500 VOLVO D200CT-2Q02

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~MseAIE8 1A042737 CPU629 03·~

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1102 ~. P6261

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4V-4NCQTJ33N341968

SY1\tPTOM6:

LEAKS

011. IN COOLANT l COOLANT' IN Oil

TIM HOVIS

7().4..!;1-oS51

I'JI.OWH HEAD CiASI<EIT

APMINISTRA'TlVI:! TJWl - OPal A~ CLOGS AEPAIR ORDER (SHOP RSPAIRS)

'T'ROUBI..ESHOOT - WB~c.&.T1NQ OR HYCAAUUC OIL IN COOLANT

TROUaL.E8HOOT ••COOlAHT IN LUPRlCAl1N<3 OL .

LUeRlCATlNG OIL PAN - ReMOve NIIO' ~ALL

HOOD, TILT - R~AND INSTAll

BUMPER" ~ ANP INSTALL

AIR CONDITIONER SYSTEM - EVACUATe: AND ReCHARGE!

AIR CONDITIONER CONDENSOR· RSMOW AND INSTAU,

CHAAOE AIR COOLER· REMOVS ~ INSTALL (pART OF AN(lTHER RSPAlft)

AAOIATOR A MMOV! ANP INSTAU. (pART OF ,Io,NOTHER Ref''''''')

REMove ANa INSTAI.L INNER FENDER.(AUTO~ APPUCATIONS)

"-"A ~LeAnER ASSEMBLV, I!NOINIWt'IOUNTfa:) ft ~ ANDI~TAL'" ~ RAOIATOR BRACESI· REMOVE ANClINSTAlJ.

AIR OONDlTIONGR COMPRESSOR ANO MACKET ft REMOVli AND INSTAU

POWER SffiERINGl RESERVOIR. RBMOVE AND INSTALL

COOLANT OVEFwLOW TANK - REIilOVE ANO fNS'fALL

CYLH:JeR HeAD ft RSMOVE AND INSTAL&.

PRESSURE TESTED CYLINDER HEIID

INJECTOR - CLEAN pXfERlOR FOR REUSE, EW:H TWO , EACH

RADIATOR. FLUSH

ENGINe· RUN-IN AND ~S1' (CHASSIS DYNAMOMETER)

STEAM CLEAN - COMPI..E"TlS eNGINe

NlA

R13PAIRAtmlORIZED BY BENNY 4J1SiOS, 2794.;6 fi:S1lMATE

VFS Leasing v Plaintiffs' . G.F. Kelly

Doc. PrOd. P 000564

~~~~~~---...•..........•..,....,..----.....,..,..----...•..•-..__....••.---....----------------------

All INVOices Due ~NO PAYASLIll TO: P.O, Soxl!0171$. OI\N1Qn.. NC m90-1T71S

"f'eAMS: NET 10T11 PROX 'I""'a ath8rYAs8 apeclflGd. A '411VIc8 Clhrga ct 1 1/2% per mOlltJ1

(al'feclJva rata or 16"1. par lI/lJlum) win bo oMrgad em cut due amOUTlts.Any c"'lma fDr &hortAgaa

01'dedualone l\lr arrQl1Boua ctIlll'DOll mull be made wfUlIn ItlIIW da)'II atter IlklAIpt of gOOda,

WAftRANTY: The IlIblllly of CLnlmJl'lSi AtlllnlJc lna.15 llmltlld to tha ob~n. pfDV\dad In tn.

WlIlTDnty proll!$lona which lIr'Oe.t fort" Oil the fl!l\I8t'$81 al<fe hlll1K1l,

Case 3:06-cv-00638-SRW Document 20-6 Filed 02/13/2007 Page 2 of 5
02/20/2008 10:17 FAX 7045970043

MATfiiRIAL RETURNED FOR. ~IT OR ~CHANGe MUST

SHOW'TliIS INVOICE NUMBBR. AU.. MATSRI~ AETURM3D

fOR CREDIT SUBJECT TO 16% HANO!-ING CHAA.rJl!. OLD

UNITS ELIGlBl.6 FOR EJ';PHANGE MI.IST De RECEIVED

WITHIN 30 DAYS. FEO!.RAL IDe oe-ot45192

I4J 002/003

P.liIII!Je;t~'L'.

VOLVO & GMC TRUCK CTR

Cummins

Atlantic c Inc.

CHARLOTTE

3700 JEFF ADAMS DR.

CHARLOTTSI NC 28208 •.

(704)5957890

003-067475

R6MlTTO: P.O.9CKS01"&

CfwflOUe, NC 211280-171'l

BILL. TO

VOLVO & GMe TRKS CAROLINA

P. O. ElOX 660001

CHARLOTTE, NO 2B2Sfil..

OWNER

VOLVO & ~MC TfU<S CAROLINA

P,O. SOX 660007

CHARLOTTE, NC 2825e.-

TIM HOVIS ~704 S97~OS61

PAGE 20F 3

8.92 .•

16.88 .•

37.19

172.87

7.89

73.44-

1.2'

1.68

1.59

21.12

0,06

98••

30.10

25.-41

7.9.a

8.02

4.42 .•

172.S1

1.8;

1,!i3

2,(16

.92

1./;'i;

1.32

.65

98.e.

31),10

''''7

,33

9.~

2.21

4.'4S

15.88

37,19

CEeO

ceeo

VALVOUNi

O'TlIEft

orneR

OTHER

9ECO

OT~

CICO

flLQ

VALVOU~

OTHER

OTH~

NONSTOCK

0IbkteNONSTOCK Pul'Ct1alecl P.~

Out.ld. PUrctlallM 1';lr1$

NONSTCCK

~~P."

~ Purchll&Od para

Iilfi Iii .l"ViaE l!iii'"1! '~M1. "oiiEi. •• iQUIP.BiT MM

ocr-2002

ISXSOO VOLVO

••••••••••• L ••• IPL"NG. 1!1IlUl'''"NT MOOliL

FJ!8-aOOO

VNLlJ 140427t7 CPL2629 SElRIES

",.. DJ.'.

••1.I1'11T"O, IEIlXiiiJijOUJ18 piJllin• 3116578

Pfl261

SE1)JpPER ENGINS GASKiT

CLEMlf51'. QD CONTACT

PP Oil- BUU<.QUAM'I'

ROLOC 3" elSC

ROl.OC 2" tnSC

MNOPAPER

NUT.REGULAR H~ JAM

BRASSP

GASI<ET.OIL PAN

J"uaE FILTEft

VALVOIlNE ~IUM BUlE-Gl.

TYRAJlI

ANTlffil!l!l%e,f"f{J:l\IIIXeo-, QI.

SLJ1..S

QROMMm

FILLER CAP

S!NSOR LEVEL

""4NC$T J33N341!1SB

1 402S300

1 3824510

4B un381

" 113491-42

4U~

1 02017

113 3183842

1 27217

,~

1 LFOOOO

~ 106De

204 CS73

, fCA001

2 0$""167

2 8075020

1 2061004S

, 8140024

OSNIM$NMN

,

,

4t

••

4

,

16

1

1

1

3

2.-

1

2

2

DATIl

1f1-FEB.aa06

cuayBiiJjI NlII ••••

7810

ni"I'ID.

58331

VFS Leasing v. G.F. Kelly

Doc. Plaintiffs' Prod. P 000565

F'ARTS~

PARTS COV6RAOr.; CRSOIT:

TOTAL PARTS:

SURCHAAQeTOTAL.:

ALL INVOlCJ:lSDU6 AND PAYABLe TO:P.O. Boxeorns. Ch/oll'lc.tta, NC 282.00-1778

TfRMS: NeT, om PROX unla" QthelwIee Gpedt!ed, A sarvlce ell.; or, '12,. per montll

(effeCItMIl'1lte Dr 18% par annllm) w1Ube oIlllilJlld on p.aat dUll ltnouPta. Any cl.trrB1l)r$hclnGgeB

t ded~. fer $rroneol.ll\ cblil'l2" ml.l8t be mild. wltIIln1Il11t1day$ after MQ.t!Ilpt of gooda

WARRANTY: 11te llabdlty of CummlM AtJric lnc. IIItrlItad to ltl8 obllaBnGnS provided In the

Vioartdtlty provI8lOnt whk:h aM /Jet I'ol'l.tl on the ruvartlIJ RittS IltiSreor.

I .1 fZ'PF"

506.80

636.82

1$.02CFO

0.00

AUTHORIZEP BY : ---------~~-------

Case 3:06-cv-00638-SRW Document 20-6 Filed 02/13/2007 Page 3 of 5
o~no/:Loot:i 10: 11:l ~AX (040:.:J{004;:1 VULVU ~ uM~ IKU~K ~IK I4l OO;:l/OO::J

003'003";' .

c Cumml".

Atlantic

Inc,!,

MI\'T'f!RW. AElURNaJ FOR CRegn' OR EXCHo'NOE MUST

sHOW THIS tNVOICE NUt-'BE.R. AU. MATERIAl.. fUffiJRNED

FOR CFlf:DfT SUBJECT TO 15% HANDLING CHARGE. OLD

UNITSf;:UGUBl.E FOR.EXC~GE MUar BERECeIVED

VIJITHIN:30 OAva, FEDERAl.lDlI! 5&-0946192

CHARLOlTE

3700 JEFF ADAMS DR.

CHARLOlTE, NO 28206-

(704)5967690

INVO!CC ~w

003-57<475

RaMrTO; P,O. Box 60111&

ChlttotII. Ne 282e0-177f

IlIILLTO

VOLVO & GMC TRKS CAROLINA

P.O. aox aG0007

CHARLOTTE, NC 28266-

Q\'lNl!tft

VOLVO & GMC TPtKS CAROLINA

P.O. BOX 560QD7

CHARLOTTE, NC 28256-

TIM HOVIS" 704 597..()551

PAr.iJ6 e~ ~

-CHARGI!-

UTi CI"II'JOIll:_ OP.l)ER NO.

"ye, p

DA.r. Iii iiilVii51£___ IICHJItL r;QU" •• 1ll1 ''''',""0, .AIt.

. ISXQlQ VOLVO D2..ocT~

i!,._"•••••if'VlA 11I&I. IiiiI.M'. ••• rot'L n. iQU"lIif1l' Nllftti!.

VNU9ERIES 14oq717 CP~ 03ofBW1XJ6

lMiiliil'lD" "'UAII~1IlI UNITPUIIfI Nil. CUt/E ,AR.Ti .i••. 

1102 388818 f'G201

IlltAlllrt1V' n"'G', j OlJ,\~';'llV I l'l,f', ' I' . ;, l'ltnollr.t ,,' •.. ; "'lllltn~ll IlIl1lr\'LiI "'I "I"f) "WltllCl'! ' . ..~ ".1'11,II.lIl .', 'c'Jl" ' I ' I ,fJlJl1 ~r;l(;(" f, .'''L,IT , J ' • I jlll I II', I I 'I I I' '1 f 11 I, 1 I I., " 'i'

OSNtMSNMN

LABOfIt:

LABOlt COVElMQE CfteDfr:

TOTAl LABOR:

MISC.:

MISC. COVERAGJ: CREDIT:

TOTAl. MISO.:

WARRANTies Af'PL1E!O;

1AX EXElMPT NUMBf::RS:

PAFlTS NOT COVEReD

NO 201·1.(100.00191 TAXES:

D.Da .

0.00

o.OO~

0.00

VFS Leasing v. G.F. Kelly

Plaintiffs' P 000566 Doc. Prod.

ALL INVOICes DUe AND P~YASLE JO: P.O. 8Gx601778, Oh8l1Otta, NO 28260-1778

TEAMS: NeT 1DTM PRO)( \lnlna alt\IMWllle tpeCffted. A 86I\IIOt dI"re- ~ 11r..il'tlt Pit monUl

(.fr$QlMI rste ;f 111%F*' JI""lfll) ~I ~ cI18rgBd0" ~a. dUe ,tngum.. An'f c:t.lme for .twrtQgetl

Of' dGduct10ne fl)r AIlOMOUI C1Ilrgea fTll* be made with," thIrty d8ya after raealpt of goods..

WARAANTY: 'Tho IlIlblllV at CLlmml.,. AtliQntic lno. 18 Ilmll.ed to lM ottllgeUOltt PfO\I\dcd '" t/V)o

w.~nty prgylsbf\l which .,. sat t'otth~ 1he~e SidetlOl9Q\'.

aUaTOTAl:

TOTAL. TAX:

TOTAL AIIOUNT: us $

:lit •

:2,Seo.10

D.DO

2,880.10

AUTHORIZED BY : DATE: ----

Case 3:06-cv-00638-SRW Document 20-6 Filed 02/13/2007 Page 4 of 5
A1'i< c.2--k.--- L 5

••• illinois IDe.

Dee 16 05 09:55a

~.

Ron Thr- ",s 586-751-80,....•

_ '. , Snice & Leasing

oeFENOANT'S i .EXHfBfT

j(f1iLkx let

FAX (708) !!)l:>-8486

--------,-_ ..,~..•---

SO. CHICAGO HEiGHTs. It. S0411 ~7 (70S) 75S-a500

1 DATE 12/15/05

;t'-I:f ~ .s;4LfiS

/}J?V ;FbAJ 7ffiP?''? S

94 e. SAl.JK TRAIL

.~:":;~;r:;');f;:;;i:"-,.

..•."i" 'Ii: *,;,"''' ,

~.. "; .!i.1!:PAl:Rs

,~_ . ..•. : .14/05

TIME ?,ROMISEb

F Cp-SH TAKABLE

o

:e.

mSTOMEP..mJMBn

5ERVI CE Wp..rr£R iCEV IN ROSENTHAL' ··!;.!~.':,;;;.:;.;'t.t~-7;:•.•.•[;;;'·, ...

5. q.'~9 .45

fOTAL

5.139.45

UJ31:i 7~4iliif?j#.,j,t,.d

'J.92 .,"

425.42:l

p:~r{TSjM!S1.-: .

4.579.4:::

Si:R!J''l!..f

UNIT#

()DOM'F.1'}!:R

L4CE2.r~:;E i".

MODEL VOLVO

IN-SERVICE 0/00/00

~QU!:E'MESI 2000 OTHER.

r~JFOR.i."ttlT!ON

;EO DESGRIPTI0N

)l ESTIMATE oro REPUC£ '1'RANS.

,lIO :>.!IATE'!UAt.TO 3E :RlETURNEDWiTHOUT OUR ""MISSION. <t;U111i1SOR r->ETUmtS MUST (,E :~A::.e \'lI{THtlol '0

C:~YS• ..lcccr ••.•p"II·>ltED 05.",~,s JNV01CE. RETUftHS ARe SUIU£Cr TO HANDUNQ CNAltGE.

A S:!:>4A!\"CEC~ARGE AT A I9'EfUOOlC i'lAT!! OF, 1'2'):, "''::R MONTH. WHICH IS AN ANNUAL PE"C~~:'i;1"AGE'''lATE OF ~S%

,"ILl. ~'C CI'l/In:~rn(,INAll Ace:(l<IN' S ~Am Que:.lO CI',"S, REASONABU: ATT"ORNI:Y ~~6iS ANocosrs ,\00;:",' .,- <\~~OIJNT "LAC;:: l

i ";~1Ll)i.I.LC ~1t'!"I

••••.••••. 1~'~1 •• 1 1l'.IH:t"\",-.,:",

BSS'e 5SL S0L : 'ON 3NOHd

roofl)

Case 3:06-cv-00638-SRW Document 20-6 Filed 02/13/2007 Page 5 of 5
IN THE UNITED STATES DISTRICT COURT FOR THE

MIDDLE DISTRICT OF ALABAMA

VFS LEASING CO., )

)

PLAINTIFF, )

) CIVIL ACTION NO.: 3:06CV638-SRW

VS. )

)

G. F. KELLY, INC d/b/a KELLY )

TRUCKING; and GUY KELLY, ) 

)

DEFENDANTS. )

AFFIDAVIT OF CHARLES LANCE

STATE OF ALABAMA

COUNTY OF RANDOLPH

 Before me, the undersigned authority in and for said state and county personally appeared

Charles Lance who, after being duly sworn, deposes and says as follows:

1. My name is Charles Lance and I have personal knowledge of the matters and

things set forth herein.

2. I have over 30 years of experience in estimating and performing repairs on overthe-road trucks. I am familiar with the costs of labor and materials for all types of mechanical

and body repairs.

3. I was employed by G. F. Kelly, Inc. (“Kelly Trucking”) during the time the

21 Volvo trucks at issue were in operation. I was involved in inspecting and working on these

trucks on many occasions. I was also working for Kelly Trucking at the time the trucks were

repossessed by Volvo. Thus, I am familiar with the condition of the trucks at the time possession

was turned over to the plaintiff.

4. I reviewed the appraisal reports on the 21 trucks at issue that have been produced

by Volvo. Each report contains an estimation of reconditioning expenses for repairs which

Volvo claims are necessary to bring the truck to a wholesale condition.

5. Based on my knowledge on the conditions of these trucks at the time of

repossession, it is my opinion that many of these repairs are excessive and are not necessary to

bring the trucks to wholesale condition. In the selling of used trucks, it is industry standard that

the truck should be in wholesale condition at the time it is sold, nothing more or nothing less. 

The repairs shown on these appraisal reports would result in the trucks being in more than

wholesale condition which is not in keeping with the standard.

6. More importantly, the estimates of the costs of labor and materials to make the

listed repairs are also greatly excessive. I have evaluated the costs of these repairs based on my

knowledge and experience, and have determined the actual costs of the same repairs. Attached is

a chart comparing the reconditioning expense contained in the appraisal report (third column)

with my opinion of the actual costs of these repairs (fourth column). The chart also shows the

Case 3:06-cv-00638-SRW Document 20-7 Filed 02/13/2007 Page 1 of 4
difference between the Volvo estimate and what, in my opinion, are the actual costs of these

repairs, including all necessary parts and labor. The total difference is more than $50,000.00.

7. Based on my review of portions of the deposition of Kevin Miller, an employee of

Volvo, prospective purchasers of these trucks were provided with the appraisal reports showing

these excessive costs to recondition the trucks. These excessive reconditioning expenses would

logically have resulted in lower bids by the prospective purchasers. Had reasonable and accurate

estimates of the costs of this reconditioning been provided, bids would have been higher and

aligned with the actual value of the trucks.

8. Plaintiff is also attempting to charge $500.00 each for detailing eight trucks. This

is a total of $4,000.00. This charge is unreasonable and excessive. In 2005 a reasonable charge

for detailing a used truck in advance of placing it on the market for resale would be $125.00. 

Thus, a reasonable charge for detailing six trucks would be $1,000.00.

Case 3:06-cv-00638-SRW Document 20-7 Filed 02/13/2007 Page 2 of 4
COMPARISON OF RECONDITIONING EXPENSES

GFK Truck No. Serial No.

(Last3)

VFS Recon

Expenses

Actual Recon

Expenses

Difference

102 013 $4020 $1950 $2070

104 014 $7885 $4253 $3652

103 015 $6950 $3665 $3285

105 016 $11265 $9855 $1410

106 017 $6490 $3455 $3035

107 018 $8250 $5070 $3180

108 019 $6200 $3515 $2685

109 020 $8625 $5655 $2970

110 021 $8040 $4100 $3940

168 738 $4080 $2390 $1690

169 739 $5920 $3115 $2805

190 763 $6300 $3490 $2810

192 764 $4825 $2040 $2785

193 762 $4940 #2990 $1950

194 584 $4580 $2565 $2015

197 989 $9470 $6190 $3280

243 958 $4960 $2790 $2170

242 954 $2220 $1235 $985

241 953 $4700 $2665 $2035

240 952 $7235 $4995 $2240

244 959 $8200 $5550 $2650

TOTAL $135,155 $81,563 $53,592

Case 3:06-cv-00638-SRW Document 20-7 Filed 02/13/2007 Page 3 of 4
/s/ Charles Lance 

Charles Lance

 SWORN TO AND SUBSCRIBED BEFORE ME this the 12th day of February, 2007

/s/ Kathleen W. Newman 

 

Notary Public

My Commission Expires: 2/19/2007 

Case 3:06-cv-00638-SRW Document 20-7 Filed 02/13/2007 Page 4 of 4