### FILED O'u €` € 

### fi-F APPEALS C I' ISION it 20111 JUL - i 

### AN 6: 50 STATE OF WASHIN.GTON 

### IN THE COURT OF APPEALS OF THE STATEF DIVISION -II FORD MOTOR CREDIT d/b / a PRIMUS FINANCIAL SERVICES, Respondent,

v. RAYMOND BRENNEMAN and VALERIE BRENNEMAN, husband and wife, and their marital community composed thereof, Appellant. No. 44773 -8 -II

UNPUBLISHED OPINION

LEE, J. — Raymond and Valerie Brenneman appeal the trial court's order granting 

### summary judgment to Ford Motor Credit and awarding Ford a deficiency judgment for the balance due under its motor vehicle retail installment contract with the Brennemans. The 

### Brennemans contendthatthere are material issues offact concerning whether Ford's sale oftheir repossessed vehicle was commercially reasonable and whether Ford provided proper notice of that sale. Because no genuine issues ofmaterial fact exist, we affirm. FACTS The Brennemans bought a 2004 Volvo automobile from Barrier Volvo on December 6, 2007. In connection with this purchase, the Brennemans signed a retail installment contract that 

### set forth theterms ofthe purchase andthe installment payments they agreedto make. Ford isthe creditor with respect to the Brennemans' ,loan.No. 44773 -8 -II



### The Brennemans assert that they took the car back to Barrier for warranty repair of its transmission in the fall of 2008. 

### The Brennemans also claim that after a month - long delay, Barrier informed them that a replacement transmission was .on back order. The Brennemans grew tired of waiting and surrendered possession of the car to Barrier. 

### They believed that by 

### surrendering possession and foregoing a lemon law claim,they satisfied their obligations under the retail installment contract. Ford repossessed the car on November 3, 2008, and sent the Brennemans a notice ofits plan to sell the vehicle on November 5, 2008. 

### Ford arranged for the car to be sold at auction by Manheim Seattle, which conducts weekly vehicle auctions in Washington and other states. The car sold for $

### 13,000, leaving a balance of more than $10,000 due on the Brennemans' retail installment contract. Ford mailed a 

### statement ofsale to the Brennemans thatsetforththose figures and the deficiencythey owed. 

### When the Brennemans did not pay the deficiency, Ford sued to recover the monies due
under the retail installment contract. 

### The Brennemans responded by raising several defenses, 

### including claims that Ford's actionwas barred by its failureto give propernotice ofthe sale and thatthe salewas not commerciallyreasonable underthe Uniform Commercial Code. 

### Ford moved for summaryjudgment and provided documents showing that it mailed the notice of its plan to sell the car, as well as the statement of sale, to the address on the Brennemans' vehicle registration. Ford added that the car was sold " as is" to the highest bidder, and that the sale " was through an experienced dealer in a recognized market in a commercially
reasonable manner." Clerk' s Papers ( CP) at 33. Ford also provided a certification from its 

### business records custodian stating that it had demanded payment on the contract and that the Brennemans had refused orbeen unable to pay.
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### The Brennemans responded that they did not receive notice ofthe sale because it was sentto an address where they had resided " in the past" ratherthan theircurrent mailing address, which is the address included in their contract with Ford. CP at 49. They also asserted thattheir surrender ofthe carto the dealer satisfied their contract obligations with Ford. 

### During the hearing on Ford's motion,the Brennemans acknowledged that nothing in the contract or the law stated that surrender ofthe car would take care ofany outstanding contractual obligations. 

### Nor couldthey cite any law stating that a car's defect allows an owner to void a related sales contract. 

### The trial court granted Ford summary judgment on the issue of the 

### Brennemans' liability, but it requested additional briefing concerning the car's value and the appropriatejudgment amount. The Brennemans then moved for reconsideration and asserted that issues offact remained 

### as to whether they had actually defaulted on the contract, whether Ford's sale ofthe car was commercially reasonable, and whether they had adequate notice of the sale. They argued that their car payments were timely until they surrendered possession, and that they never received a 

### notice ofdefault. They also maintained thatthe car's inoperative transmission hadto be fixedto make Ford's sale ofthe car commercially reasonable, and that the vehicle registration form that Ford submitted was not authentic. In a separate memorandum addressing the car's value, the Brennemans contended that the value at the time of sale, based on the current " Blue Book "1 

### figure, was approximately

1 The Brennemans' memorandum cites to both the Kelley Blue Book and the National Automobile Dealer Association (NADA) valuations. We refer to the average ofthese valuations as the " Blue Book" for ease of reference.No. 44773 -8 -II

23, 000. CP at 76, 77. 

### They asserted in the alternative that the car was defective and had no retail commercial value. Ford' s response concerning the car' s value attached the auctioneer's condition report 

### statingthatthe vehiclewas drivable and that its overall condition was average atthetime ofsale. The report also showed that the car was valued at $ 10,650 before the auction. Ford argued that the carwas not defective and not without value.

In response to the Brennemans' motion for reconsideration, Ford again asserted that it had shown the car was operable at the time of default and that the Brennemans had provided no competent evidence to support their claim to the contrary. Ford also argued that it had shown, with the certification from its business records custodian, that the Brennemans were in default. Ford added that the vehicle registration it had submitted was valid but argued that even if its 

### notice ofthe salewas insufficient,the Brennemans had notdisclosed any resulting loss.

The trial court denied the Brennemans' motion for reconsideration and concluded that the
value of the car was established 

### by the commercially reasonable sale. The court ultimately entered ajudgment of $14,389.07 in Ford's favor.

On appeal, the Brennemans argue that material issues of fact remain on the issues of commercial reasonableness and notice that preclude summary judgment and the entry of a 

### deficiencyjudgment againstthem.

4No. 44773 -8 -II
ANALYSIS

1. STANDARD OF REVIEW 

### When reviewing a summaryjudgment order, we engage in the same inquiry as the trial court, on the same record. Marshall v. Bally' s Pacwest, Inc., 

### 94 Wn. App. 372, 377, 972 P.2d 475 ( 1999). A summaryjudgment order can be granted only if the pleadings, affidavits, 

### depositions, and admissions on file showthe absence of any genuine issues ofmaterial fact, and 

### thatthe moving party is entitled tojudgment as a matter oflaw. Marshall, 94 Wn.App. at 377. The motion should be granted only if,from all the evidence, reasonable persons could reach but

one conclusion. Wojcik v. Chrysler 

### Corp., 50 Wn. App. 849, 854, 751 P.2d 854 ( 1988). The court must consider all facts submitted and all reasonable inferences from the facts in the light
most favorable to the nonmoving party. 

### Nivens v. 7 -11 Hoagy's Corner, 133 Wn.2d 192, 198, 943 P.2d 286 ( 1997). 

### After the moving party has submitted adequate affidavits, the nonmoving party must set forth specific facts rebutting the moving party's contentions and disclosing the existence of issues of material fact. Marshall, 94 Wn. App. at 377. A nonmoving party may not rely on speculation or on argumentative assertions that unresolved factual issues remain. White v. State, 131 Wn.2d 1, 9, 929 P.2d 396 ( 1997). Although CR 56(e) requires an affidavit submitted in a 

### summary judgment proceeding to be based on personal knowledge, to set forth admissible evidentiary facts, and to show that the affiant is competent to testify as to his averments, courts generally will indulge in some leniency with respect to affidavits presented by the nonmovant. Pub. Util. Dist. No. 1 ofLewis County. v. Wash. Pub. Power Supply Sys. ( WPPSS), 104 Wn.2d

5No. 44773 -8 -II

353, 360 -

61, 705 P.2d 1195, 713 P.2d 1109 ( 1985). 

### Such leniency does not extend, however,to affidavits containing inadmissible evidence or conclusory statements. WPPSS, 104 Wn.2d at 361. 

### In responding to Ford's motion for summaryjudgment, the Brennemans submitted an 

### unsworn affidavitthatwas not signed underpenalty ofperjury. See GR 13 (unsworn affidavit is permitted if signed under penalty ofperjury). The Brennemans attached an identical declaration 

### that was signed under penalty of perjury to their reply to Ford's response to their motion for
reconsideration. 

### We will consider these filings in determining whether issues of fact remain concerning the commercial reasonableness ofthe sale or Ford's notice thereof. 2. COMMERCIAL REASONABLENESS 

### The Uniform Commercial Code requires a creditor to dispose of a defaulting debtor's collateral in a " commercially reasonable" manner. RCW 62A.9A-610(b); Sec. State Bank v. Burk, 100 Wn. 

### App. 94, 95, 995 P.2d 1272 ( 2000). The fact that a greater amount could have 

### been obtained by a disposition at a different time or in a different method from that selected is not alone sufficient to preclude the creditor from establishing thatthe disposition was made in a commercially reasonable manner. RCW 62A.9A-627( a). A disposition of collateral is 

### commercially reasonable ifit is made inthe usual manner in any recognized market, atthe price current in any recognized market at the time ofthe disposition, or is otherwise in conformity with reasonable commercial practices among dealers inthe type ofproperty thatwas the subject of the disposition. RCW 62A.9A-627(b). In sum, the commercial reasonableness of a sale depends on the procedures employed and not on the proceeds generated. 

### Leasing Serv. Corp. v.

6No. 44773 -8 -II

Diamond Timber, Inc., 559 F. 

### Supp. 972, 979 ( S. D.N.Y. 1983) ( 

### citing Foster v. Knutson, 84 Wn.2d 538, 527 P.2d 1108 ( 1974)), 

### all' d,729 F.2d 1442 (2d Cir. 1983). 

### The burden of proving commercial reasonableness is on the creditor, who is in the better position to know and control the nature of resale, and is the one asserting the deficiency judgment. "' 

### Sec. State Bank, 100 Wn.App.at 101 ( quoting Rottav. Early Indus. Corp.,47 Wn. App. 21, 24, 733 P.2d 576, review denied, 109 Wn.2d 1012 ( 1987)). 

### When the propriety ofthe 

### secured party's disposition of collateral is contested, the issue of commercial reasonableness
should be determined as a matter of law only in the clearest of cases. Sec. State Bank, 100 Wn. App. at 101.

In arguing that its sale was commercially reasonable, Ford pointed out that the 

### Brennemans signed a contract stating that Ford could repossess and sell the car ifthey violated their obligations thereunder. Ford placed the car with an experienced auctioneer, and information about the car was available online before the sale. The car was sold " as is" to the highest bidder. CP at 33.

The Brennemans responded that Ford had to replace the car' s defective transmission 

### before selling it because the duty to recondition collateral is an essential component of
commercial reasonableness. To support this argument on appeal, they cite authority providing 

### that ifthe cost ofpreparing the collateral for sale is small in comparison to the additional price it may generate, the creditor should spend the extra money. Westgate State Bank v. Clark, 231 Kan. 81, 92, 642 P.2d 961, 970 ( 1982); 

### see also Union Nat'l BankofWichita v. Schmitz, 18 Kan. App. 2d 403, 405, 412, 853 P.2d 1180, 1182, 1187 ( 1993) ( sale ofcar in "fair to poor shape" was commercially reasonable where creditor spent $ 15 to have it washed and vacuumed). As the
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Westgate court explained, "[

### W]ashing and cleaning up consumer goods orequipment may bethe 

### only commercially reasonable thing to do in order to generate bidder interest at the sale." Westgate State Bank, 642 P.2d at 970. These cases do not support the argument that Ford had to recondition the car before its sale at auction.

The Brennemans' 

### argument regarding the impact of the defective transmission on the issue of commercial reasonableness is also unavailing because it depends largely on hearsay
statements from the unnamed mechanic who allegedly inspected their car. As Ford asserts, the Brennemans presented no competent evidence to support their assertion that their vehicle was defective. 

### They attach to their appellate briefa notice ofa class action settlement reached with 

### Volvo concerning failing transmissions, butthatdocumentwas not before thetrial courtand may
not be considered on appeal. Riojas v. Grant 

### County Pub. Util. Dist., 

### 117 Wn.App. 694, 696

n. 1, 72 P.3d 1093 (2003), review denied, 151 Wn.2d 1006 (2004); RAP 9. 12. Furthermore, the Brennemans' statements regarding the car' s condition atthe time ofsale 

### are speculative because they do not knowwhetherthetransmission, even ifdefective,was in fact replaced before the car was sold. Moreover,the Brennemans assert contradictory positionsthat the car was worth the Blue Book figure for a car in excellent condition and that the car had no retail commercial value.2 

### By contrast, Ford submitted documentation addressing the car's 2 Ford complains for the first time on appeal that Blue Book documents attached to the Brennemans' memorandum were not properly authenticated under ER 901. The Brennemans 

### respond that these documents are from self - authenticating periodicals and that this court has determined that the Blue Book figure is convincing evidence of value. ER 902(f); McChord Credit Union v. Parrish, 61 Wn.App. 8, 15, 809 P.2d 759 ( 1991). Even ifthese documents are 

### properly before us,they do notcreate an issue offact. In McChord Credit Union,the Blue Book value was $ 1000 greater than the sale price, and the court found no reason for the discrepancy
8No. 44773 -8 -II

condition at the time of sale. Thus, the Brennemans' conflicting and speculative assertions, based 

### largely on 

### hearsay, fail to create a question of fact on the issue of commercial
reasonableness. 3. NOTICE 

### The Brennemans argue that there are issues of material fact regarding whether Ford 

### complied with the Uniform Commercial Code in providing proper notice oftheir default, Ford's acceleration ofthe underlying debt, and the intended sale oftheir vehicle. 3 The Uniform Commercial Code requires a creditorthat disposes ofrepossessed collateral to send notification of the planned disposition to the debtor. RCW 62A.9A-611(b); Rotta, 47 Wn. 

### App. at 24. A person gives notification to another " 

### by taking such steps as may be reasonably required to inform the other in ordinary course whether or not such other actually

comes to know of it." Former 62A.1- 201(26) ( 2011) ( 

### recodified as RCW 62A.1- 202(3)( d) by Laws of 2012, ch. 214, § 110). 

### Consequently, notice may be effective even though it is not received if the creditor acted reasonably in trying to send notice. 27 MARJORIE D. ROMBAUER, WASHINGTON PRACTICE: CREDITORS' REMEDIES - DEBTORS' RELIEF, § 3. 126 at 273 ( 1998). The Uniform Commercial Code defines " send" as follows:
based on the description of the car in the record. 61 Wn.

### App. at 15. The Brennemans' assertion 

### thattheir carwas worth the Blue Bookvalue is entirely speculative. 3 As support, the Brennemans cite U.C.C. § 9 -504 and RCW 62A.9A.611. U.C.C. § 9 -504 

### addresses the description of collateral that a financing statement should provide and is not pertinent here. RCW 62A.9A.611 addresses the notice of disposition requirements and is discussed above. 

### The Brennemans cite no authority to support their argumentthatthe Uniform Commercial Code required Ford to provide separate notice oftheir default or its acceleration of the debt, so we do not address these claims of error. RAP 10.3( a)( 6); Cowiche Canyon 

### Conservancyv. Boseley, 118 Wn.2d 801, 809, 828 P.2d 549 ( 1992).
9No. 44773 -8 -II



### Send" in connection with any writing or notice means to deposit in the mail or deliverfortransmission by any other usual means ofcommunication with postage or cost oftransmission provided for and properly addressed and in the case ofan instrument to an address specified thereon or otherwise agreed, or ifthere be none to any address reasonable underthe circumstances. Former RCW 62A.1 - 201( 3 8) ( 2011). 

### When the Brennemans argued that they never received notice of Ford's plan to sell the 

### vehicle at public auction, Ford provided a copy ofthe notification showing that it was sent to them at the address listed on the vehicle registration. 

### The Brennemans asserted that while they had lived at that address " in the past," 

### they were living at a different address at the time ofthe notification. CP at 49. 

### On appeal, they refer to their argument that the registration form was fraudulent, butthey have provided no facts to supporttheir claim offraud and no explanation as to how a former address was included in their vehicle registration if they did not provide it themselves. 

### Ford persuasively argues that it was reasonable to send the notification to the address listed on the vehicle registration and that, as stated above, actual receipt of notification is not required if it acted reasonably in trying to send notice. Ford also argues that even if its notice 

### was deficient, the remedy is limited to the Brennemans' loss resulting from the deficiency. McChord Credit Union v. Parrish, 61 Wn.

### App. 8, 14, 809 P.2d 759 ( 1991). The Brennemans claimed no such loss below. The Brennemans contend for the first time on appeal that with proper notification, they could have exercised their right of redemption or ensured that the faulty transmission was replaced so that a higher resale price could be obtained. This contention seems highly speculative given their beliefthat surrender ofthe car satisfied their contractual obligations. But,
10No. 44773 -8 -II



### even ifsuch steps were likely,we may not considerthis untimely assertion in reviewingthe trial
court' s decision. Hanson Indus., 

### Inc. v. Kutschkau, 158 Wn. App. 278, 290, 239 P.3d 367 2010), review denied, 171 Wn.2d 1011 ( 2011). 

### We conclude that there are no issues ofmaterial fact concerning Ford's compliance with 

### the Uniform Commercial Code in notifying the Brennemans about the intended sale of the 

### vehicle. Consequently,we need notaddress the Brennemans' argument, again raised forthefirst time on appeal, concerning Ford' s failure to obtain a timely appraisal of the vehicle. See 

### McChord Credit Union, 61 Wn.App. at 14 (creditorthatviolates the Uniform Commercial Code faces a rebuttable presumption that the value of the collateral at or near the time of repossession 

### is at least equalto the amountofthe outstanding debt).

We affirm. 

### A majority of the panel having determined that this opinion will not be printed in the Washington Appellate Reports, but will be filed for public record in accordance with RCW 2.06.040, it is so ordered.

We concur:

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