Court Opinion

ID: 9699212
Source: CourtListenerOpinion
Date Created: 2023-08-25 20:13:31.534778+00
Date Added: 2024-06-11T18:20:47.513709
License: Public Domain

VANDE WALLE, Justice,
concurring in result.
I concur in the result reached in the majority opinion. Because it might appear that the secured party’s obligation is the same whether or not that party gives notice of sale to the debtor, and although they are interrelated concepts, I write separately to emphasize the perhaps fine distinction between the duty to rebut the presumption which arises when no notice of sale is given as required by Section 41-09-50(3), N.D.C.C., and the burden of proving that every aspect of the sale is commercially reasonable within the meaning of that provision, even when notice is given by the secured party.
In State Bank, Etc. v. All-American Sub, Inc., 289 N.W.2d 772 (N.D.1980), we held that when a secured party fails to give notice of sale as required by statute, it will be presumed the collateral had a fair market value equal to the amount of the debt and no deficiency will be allowed unless the creditor overcomes this presumption by producing evidence that the fair market value of the collateral was less than the outstanding debt. In so concluding we indicated that the failure to give notice shifts to the secured party the burden of proving that the sale resulted in the fair and reasonable value of the property being credited to the debtor’s account. But this “shifting of the burden” is a burden to rebut the presumption which results as a failure to give notice of sale and requires the secured party to prove the sale resulted in the fair and reasonable value of the property being credited to debtor’s account. Contrary to American State Bank’s position, neither All-American Sub nor State Bank of Towner v. Hansen, 302 N.W.2d 760 (N.D.1981), which relied thereon, held that the giving of the required notice of sale creates a presumption that every aspect of the sale was commercially reasonable. Thus the presumption which arises as a result of a failure to give notice and which creates a burden on the secured party to rebut, is not inconsistent with a burden on the part of the secured party who gives notice to prove, absent any presumptions, that every aspect of the sale was commercially reasonable. Proving fair and reasonable value obtained is one aspect of proving the sale was commercially reasonable. Therefore, the secured party who gives notice of sale to the debtor must prove that every aspect of the sale was commercially reasonable, as does the secured party who does not give such notice. However, the secured party who does not give notice must, in addition, rebut the presumption that the collateral had a fair market value equal to the amount of the debt, and thus has a greater burden of proof.