Source: http://commercialforeclosureblog.typepad.com/indiana_commercial_forecl/replevin/
Timestamp: 2017-06-28 10:26:10
Document Index: 746465006

Matched Legal Cases: ['§ 32', '§ 26', '§ 32', '§ 32', '§ 32', '§ 32', '§ 32']

Indiana Commercial Foreclosure Law: Replevin Indiana Commercial Foreclosure Law
Replevin Damages: Deterioration and Loss of Use Lesson. In Indiana replevin cases, plaintiffs are not limited to the remedy of repossession but may also be entitled to money damages for deterioration of the property value and for loss of use.
Legal issue. Whether the trial court abused its discretion in determining the amount of damages awarded to the plaintiff. Vital facts. Roy Bayer Trust was a dispute between a lessor and a lessee of a Kenworth (semi-tractor). The lessee defaulted under the terms of the lease. Evidence showed that the fair market value of the Kenworth was $16,000 and that the Kenworth was sold for only $6,000 due to deterioration, which occurred while the lessee held it wrongfully post-default. Evidence also showed that the Kenworth could have been leased to another party had the lessee not detained it, although the trial court did not consider these damages. Procedural history. The Roy Bayer Trust opinion arose out of (1) the lessee’s appeal of the trial court’s summary judgment for the lessor and (2) the lessor’s cross-appeal contesting the amount of damages awarded to it by the trial court. Key rules. In actions to recover possession of personal property, judgment for the plaintiff may include damages for detention of such property. Indiana Code § 32-35-2-33(2).
Holding. The Indiana Court of Appeals affirmed in part and remanded in part. The Court affirmed the trial court’s summary judgment to the lessor for damages based upon the deterioration of property value. The Court remanded the case for the trial court to determine whether the lessor was entitled to more damages for loss of use. Policy/rationale. The Court believed that the damages rules above are prudent. “The amount of damages in a replevin action must be limited to a reasonable amount-both as a general matter and in relation to the fair market value of the property. And although the deterioration and loss of use are separate theories of recovery, we believe the total damages award is subject to a requirement of reasonableness.” Related posts. What Is Replevin?
For Summary Judgment On Replevin Claim, 5 Dots To Connect With Affidavit
Barbara v. Pringle, 2013 U.S. Dist. LEXIS 167024 (.pdf), discussed last week, involved a replevin claim. The borrowers pledged a security interest in all relevant personal property owned by the companies. The lender sought to recover such non-real estate property pledged as collateral for the loans. Security interest. The lender in Barbara established a security interest in the collateral described in the guaranty agreement pursuant to Indiana Code § 26-1-9.1-203, which security interest had been perfected by the filing of financing statements with the Indiana Secretary of State. The Court then noted “it is black letter law that, upon default, a secured creditor has the right to take possession of the collateral securing its claim.” The Court basically said that the plaintiff lender should prevail on the replevin claim. But. The Court, on summary judgment, concluded that summary judgment could not be entered for the borrower because the requisite affidavit supporting the replevin action had not been submitted. In Indiana, a replevin claim is successful “if the plaintiff proves her right to title or possession of the property, proves that the property is unlawfully detained, and proves that the defendant wrongfully holds possession of the property.” Affidavit. Before a replevin order could be issued, the lender needed to comply with Indiana law requiring the filing of an affidavit that describes the property at issue and states:
the plaintiff is the owner of the property or is lawfully entitled to possession,
the property has not been taken for a tax assessment or fine pursuant to statute; seized under an execution or attachment against the property of the plaintiff, or if seized, it is by statute exempt from seizure,
the property has been wrongfully taken and is unlawfully detained by the defendant,
the county in which the property is being detained.
See, Ind. Code §§ 32-35-2-3 and 4. Since the plaintiff lender did not provide the affidavit, the Court was unable to grant summary judgment at that time. Lenders and their loan enforcement counsel should remember the replevin affidavit when filing a motion for summary judgment. The affidavit should address each of the five matters above. Without such evidence, the motion will be denied.
Posted on April 20, 2015 in Replevin | Permalink
Equitable estoppel. The Court in Dawson devoted a portion of its opinion to Buyer’s claim for equitable estoppel. The discussion focused on certificates of title and which party was in the best position to protect itself based upon the public records. The opinion is helpful for those who deal with motor vehicle transactions. In the end, Bank was not responsible for Seller’s loss. Posted on April 16, 2013 in Replevin, UCC/Security Interests | Permalink
Posted on June 06, 2011 in Replevin, UCC/Security Interests | Permalink
In my January 31, 2009 post “What is Replevin?”, I discussed the fundamentals of an Indiana claim for replevin, which is the judicial process to repossess personal property or, in the context of this blog, to foreclose upon non-real estate loan collateral. I cited to the Whittington opinion by Judge McKinney from the Southern District of Indiana. In 2010, the Seventh Circuit affirmed Judge McKinney’s opinion in Whittington v. Indianapolis Motor Speedway Foundation, 2010 U.S. App. LEXIS 7524 (7th Cir. 2010) (.pdf ). Whittington did not involve a loan enforcement action but is interesting and informative for lenders nonetheless. Car trouble. The plaintiff in Whittington sought a court order granting him possession of an antique race car that he transferred to the Indianapolis Motor Speedway’s Hall of Fame Museum in the 1980’s. The plaintiff claimed that he loaned the car to the museum. The museum contended that plaintiff donated the car. The transfer was not documented, and the witness testimony was in dispute. The Seventh Circuit lectured that it was:
The basics. Indiana case law provides that, to succeed on a claim for replevin, a plaintiff must prove (1) his right to title or possession, (2) that the property is unlawfully detained and (3) that the defendant wrongfully holds possession of the property. Indiana also has a statute governing replevin at Ind. Code § 32-35-2. The initial burden of proof is on the person seeking repossession – for purposes of this blog, the lender/creditor. As noted by the Court, “the plaintiff must prove his right to possession on the strength of his own title, not merely the weakness of the defendant’s title or right to possession.” Possessory right. The Court stated that having a present possessory interest in the property/car was an essential element to the replevin claim. In loan enforcement actions involving non-real estate collateral, the right to possession element should be a non-issue by virtue of the security agreement between the creditor and debtor, and/or the UCC’s enforcement sections (I.C. 26-1-9.1-601 through 628). My working understanding is that the “right to possession” facts necessary for a replevin action are satisfied by the terms of the loan or, more specifically, the secured lender’s/creditor’s remedies upon a default. (For some background, see my December 7, 2010 post.) Absent such a possessory interest, a replevin action will fail, as it did in Whittington.
In this context, a lender is the person entitled to repossession of the property, and a defaulting borrower is the one who has wrongfully detained the property. Indiana statute. Ind. Code § 32-35-2 governs replevin actions. The detailed statute provides the procedural steps to repossess personal property. Section 1 states that grounds for an action for replevin exist:
If any personal goods, including tangible personal property constituting or representing choses in action, are: (1) wrongfully taken or wrongfully detained from the owner or person claiming possession of the property; or(2) taken on execution or attachment and claimed by any person other than the defendant;the owner or claimant may bring an action for the possession of the property.
 “A replevin action is a speedy statutory remedy designed to allow one to recover possession of property wrongfully held or detained, as well as any damages incidental to the detention.” Reasonable loss of use damages may be recovered in a replevin action; I.C. § 32-35-2-33 provides that judgments for plaintiffs in replevin actions may be for (1) delivery of the property, or the value of the property in case delivery is not possible and (2) damages for the detention of the property. To repossess and, ultimately, liquidate most non-real estate loan collateral in Indiana, asset-based lenders and their legal counsel need to be familiar with I.C. § 32-35-2 and the applicable case law. Posted on January 31, 2009 in Replevin | Permalink