Present: Kinser, C.J., Lemons, Goodwyn, Millette, and Mims, 

JJ., and Carrico and Koontz, S.JJ.

CAPPO MANAGEMENT V, INC., T/A VICTORY NISSAN OF CHESAPEAKE

v. Record No. 100797 OPINION BY JUSTICE DONALD W. LEMONS

June 9, 2011

BRENDA BRITT

FROM THE CIRCUIT COURT OF THE CITY OF NEWPORT NEWS

David F. Pugh, Judge

In this appeal, we consider whether the Circuit Court of 

the City of Newport News (the "trial court") erred when it 

ruled that Cappo Management V, Inc., trading as Victory Nissan 

of Chesapeake ("Victory Nissan"), violated Article Nine of the 

Uniform Commercial Code as adopted by Virginia in Title 8.9A 

("Article Nine") by not providing a notice of disposition to 

Brenda Britt ("Britt") after Victory Nissan repossessed and 

disposed of a car it previously had sold to Britt.

I. Facts and Proceedings Below

In November 2004, Britt went to Victory Nissan in 

Chesapeake, Virginia, to inquire about purchasing a car. 

Finding a car she desired to purchase, Britt completed and 

signed a "Credit Application," a "Buyer's Order," a "Retail 

Installment Sales Contract" ("RISC"), a "Supplement to Purchase 

Contract," and an "Agreement to Furnish Insurance Policy." The 

"Buyer's Order" stated that the "buyer's order, along with 

other documents signed by [Britt] in connection with this 

order, comprise the entire agreement between the parties 
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affecting this purchase." As a down payment on the purchase of 

the new car, Britt traded in her old vehicle and wrote Victory 

Nissan a check for $1,500.

Victory Nissan subsequently attempted to obtain financing 

for the sale of the car to Britt through Capital One, but 

Capital One "withdrew financing." Thereafter, Victory Nissan 

sought to void its contract with Britt and, in January 2005, 

Victory Nissan repossessed the car from Britt's home in North 

Carolina. Victory Nissan later disposed of the vehicle without 

providing prior notice to Britt.

Britt subsequently filed a warrant in debt against Victory 

Nissan in the General District Court for the City of Newport 

News. Britt alleged that Victory Nissan violated Article Nine, 

and sought liquidated statutory damages pursuant to Code 

§ 8.9A-625(c)(2). At trial, the General District Court entered 

judgment in Britt's favor at the court's jurisdictional limit 

of $15,000. Victory Nissan appealed, and the suit was heard de 

novo by the trial court.

Upon the parties' stipulations of fact and exhibits, the 

trial court found that Victory Nissan sold the car to Britt by 

a conditional sale. The trial court held that Victory Nissan's 

subsequent repossession of the car was governed by Article 

Nine. The trial court also found that Victory Nissan failed to 

provide Britt the notice of disposition required by Article 
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Nine; accordingly, the trial court entered judgment against 

Victory Nissan for $15,000, plus interest.

Victory Nissan timely filed its notice of appeal and we 

granted an appeal on the following assignment of error: 

1. The trial court erred in ruling that [Victory Nissan]

violated Va. Code §§ 8.9A-611 through [-]614 by not 

providing a notice of disposition to [Britt].

II. Analysis

A. Standard of Review

“The interpretation of a contract presents a question of 

law subject to de novo review.” PMA Capital Ins. Co. v. US

Airways, Inc., 271 Va. 352, 357-58, 626 S.E.2d 369, 372 (2006).

B. Victory Nissan Violated Article Nine

On appeal, Victory Nissan contends that the trial court 

erred in ruling that Victory Nissan violated Article Nine 

because those sections of the Virginia Code apply only after a 

default, which never occurred in this case. Specifically, 

Victory Nissan argues that it was not a secured creditor under 

Article Nine because the contract documents were conditioned 

upon final approval by a lender – a condition which never 

occurred, thereby making Victory Nissan's agreement with Britt 

void. Britt contends that the trial court properly held that 

Victory Nissan was a secured creditor in this case and Victory 

Nissan failed to comply with its Article Nine obligations after 
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it cancelled the sale. We agree with the trial court and 

Britt.

We have stated that, "when considering the meaning of any 

part of a contract, we will construe the contract as a whole." 

Lansdowne Dev. Co. v. Xerox Realty Corp., 257 Va. 392, 401, 514 

S.E.2d 157, 161 (1999). We have also held that "[i]n the event 

of an ambiguity in the written contract, such ambiguity must be 

construed against the drafter of the agreement." Martin & 

Martin, Inc. v. Bradley Enters., Inc., 256 Va. 288, 291, 504 

S.E.2d 849, 851 (1998). Viewing the agreement between Victory 

Nissan and Britt as a whole, there is a conflict between the 

"Bailment Agreement" provision in the "Supplement to Purchase 

Contract," which declares that the car was to "remain the 

property of [Victory Nissan]" pending "approval of a lender,"

and the other contract documents, all of which treat the 

vehicle as Britt's property as of November 28, 2004, the date 

of the sale.

Specifically, the "Agreement to Furnish Insurance Policy"

required Britt "to furnish [her] own Insurance Policy" covering 

the vehicle, and further stated that Britt "assume[s] forthwith 

any and all responsibility for . . . the vehicle." The "RISC"

states that Victory Nissan "will figure [Britt's] Finance 

Charge on a daily basis at the Annual Percentage Rate," 

effective as of the date of the sale, November 28, 2004. 
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Lastly, Victory Nissan conceded, and the "RISC" and the 

"Buyer's Order" evidence, that Britt took possession of the 

vehicle on November 28, 2004, after trading in her previous

vehicle and after making a down payment on the new car. All 

three of these documents treat the vehicle as Britt's property 

and are effective as of the date they were entered into, 

November 28, 2004. In this case, Victory Nissan was the 

drafter of the agreement. Accordingly, the ambiguity must be 

construed against Victory Nissan.

Applying this principle, we hold that the agreement 

between Victory Nissan and Britt constituted a conditional 

sales contract, and that the vehicle became Britt's property on 

November 28, 2004, pursuant to the terms of the agreement. We 

also agree with Britt that the language in the "Supplement to 

Purchase Contract," that Britt "understand[s] that the 

completion of this sales transaction is contingent upon 

approval of a lender," is a condition subsequent which, when 

not fulfilled, provided Victory Nissan the right to cancel the 

sale and the contract. This is not the end of the inquiry, 

however.

Article Nine of the UCC governs secured transactions and 

applies to "a[ny] transaction, regardless of its form, that 

creates a security interest in personal property . . . by 

contract . . . ." Code §§ 8.9A-101 and 8.9A-109 (emphasis 
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added). Under Article Nine, a secured party includes "a person 

in whose favor a security interest is created or provided for 

under a security agreement" as well as "a trustee, indenture 

trustee, agent, collateral agent, or other representative in 

whose favor a security interest . . . is created or provided 

for." Code § 8.9A-102(a)(72)(A) & (E). In this case, Victory 

Nissan acquired a security interest in the car by virtue of the 

terms of the "Buyer's Order" and the "RISC." The "Buyer's 

Order" declares that "[Britt] hereby grants [Victory Nissan] a 

security interest in the motor vehicle . . . to be purchased 

pursuant to this agreement, and such security interest shall 

remain in effect until all sums due hereunder have been paid in 

full." Similarly, the "RISC" lists Victory Nissan as the 

"Creditor-Seller" and states that, "[Britt is] giving [Victory 

Nissan] a security interest in the vehicle being purchased."

In order for Britt to avail herself of the protections of 

Article Nine and recover statutory damages, she must have been 

a debtor. Code § 8.9A-625(c). A "debtor" is "a person having 

an interest, other than a security interest or other lien, in 

the collateral, whether or not the person is an obligor." Code 

§ 8.9A-102(a)(28)(A). In this case, Britt made a down payment 

on the car, traded in her old vehicle, and assumed an 

obligation to pay monthly installments. As a result, Britt 

obtained an interest in the collateral (the car) as a debtor. 
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See Barnette v. Brook Road, Inc., 457 F. Supp. 2d 647, 658 

(E.D. Va. 2006) (citing Rhoten v. United Va. Bank, 221 Va. 222, 

225-29, 269 S.E.2d 781, 783-85 (1980)) (holding that because 

the plaintiff made a down payment on the car and assumed an 

obligation to pay monthly installments "she obtained an 

interest in the collateral as a debtor"). Notably, the 

provisions of Article Nine apply "whether title to collateral 

is in the secured party or the debtor." Code § 8.9A-202.

Having held Britt to be a debtor under Article Nine, our 

focus shifts to the validity of Victory Nissan's repossession 

of the car. "After default, a secured party . . . may take 

possession of the collateral . . . ." Code § 8.9A-609(a)(1). 

Victory Nissan concedes that no default occurred in this case. 

"Typically, a secured creditor may not take possession of the 

collateral until the debtor defaults." Barnette, 457 F. Supp. 

2d at 658 (citation omitted). However, the parties may vary 

the provisions of the Uniform Commercial Code, as adopted into 

Virginia law, by agreement, as long as they act in good faith. 

Code § 8.1A-302; Becker v. National Bank & Trust Co., 222 Va. 

716, 719, 284 S.E.2d 793, 794 (1981). See Barnette, 457 F. 

Supp. 2d at 658. Accordingly, the parties were free to agree 

that Victory Nissan, as the secured creditor, may repossess the 

vehicle after the occurrence of something other than default. 

This is exactly what the parties in this case did.
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The "Buyer's Order" stated:

If [Victory Nissan] does not receive approval 

from a financial source for [the] proposed 

[RISC, it] may cancel the sale and the contract, 

and [Britt] will return the vehicle . . . . If 

[Britt fails] to return the vehicle [Victory 

Nissan] shall be entitled to repossess the 

vehicle and shall have all other rights under 

. . . the Code of Virginia . . . and common law.

Accordingly, when financing fell through, Victory Nissan gained 

the right to repossess the vehicle. Because Victory Nissan was 

a secured party and Britt was a debtor under Article Nine, 

however, Victory Nissan also "incurred certain obligations when 

it repossessed the car." Barnette, 457 F. Supp. 2d at 659.

After repossessing the collateral, a secured party may 

dispose of it in a commercially reasonable manner, Code § 8.9A610(a), but it must provide notice to the debtor 10 days before 

doing so. Code §§ 8.9A-611 through -614. Significantly, "[i]t 

is the secured party's repossession of the collateral, not 

necessarily the default, that triggers the notice requirement. 

Absent valid waiver by the debtor in a written agreement made 

after default, the parties could not alter the notice 

provisions." Barnette, 457 F. Supp. 2d at 659 (citing, inter 

alia, Code §§ 8.9A-602(7) and 8.9A-624(a)). The parties did 

not waive the notice requirement in this case. Additionally, 

Britt, as a debtor, retained an interest in the car after 

Victory Nissan repossessed it, at least to the extent that she 
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had a right of redemption under the "RISC" and Virginia law. 

See Code § 8.9A-623(c)(2). Therefore, Victory Nissan was 

required to provide notice to Britt prior to disposition of the 

car. Victory Nissan concedes that it did not do so.

III. Conclusion

We hold that the trial court did not err in its judgment

that Victory Nissan's repossession of the car in this case was 

governed by Article Nine and that Victory Nissan failed to 

provide Britt the required notice of disposition required by 

Article Nine. Accordingly, the judgment of the trial court is 

affirmed.

Affirmed.