Burley v. Gelco Corp., No. 5D06-1995.

CourtCourt of Appeal of Florida (US)
Writing for the CourtSawaya
Citation976 So.2d 97
PartiesJohn BURLEY, Appellant, v. GELCO CORPORATION, d/b/a G.E. Capital, etc., Appellee.
Docket NumberNo. 5D06-1995.
Decision Date29 February 2008
976 So.2d 97
John BURLEY, Appellant,
v.
GELCO CORPORATION, d/b/a G.E. Capital, etc., Appellee.
No. 5D06-1995.
District Court of Appeal of Florida, Fifth District.
February 29, 2008.

[976 So.2d 98]

James N. Charles, Celebration, for Appellant.

[976 So.2d 99]

Leo Benitez of Benitez & Associates, Coral Gables, for Appellee.

SAWAYA, J.


The issue we must resolve is whether summary final judgment rendered in an action for replevin and breach of vehicle lease agreement is appropriate when material issues of fact exist as to whether the sale of the repossessed vehicles was commercially reasonable as required by Article 9 of the Uniform Commercial Code (U.C.C.). Based on the facts and circumstances of the instant case, we reverse the summary final judgment and remand for further proceedings.

Gelco Corporation filed the above referenced action after Mr. Rooter of Central Florida, Inc. and its president, John Burley, defaulted on a vehicle lease agreement under which Mr. Rooter agreed to lease three vehicles owned by Gelco. Mr. Burley also signed a personal guaranty of the payments. The court ordered that Mr. Rooter and Mr. Burley surrender the vehicles upon the posting of a bond by Gelco. An Agreed Order Granting Partial Summary Judgment as to Count I (Replevin) was entered. The vehicles were turned over to Gelco, which subsequently moved for final summary judgment as to damages. In its motion, Gelco alleged that after it recovered the three vehicles, Gelco disposed of them "in a commercially reasonable manner," obtaining $44,180 from the auction sale and leaving a balance of $55,928.80 due under the lease.1

Mr. Burley filed an affidavit in opposition to Gelco's motion, stating, inter alia, that he was entitled to receive notice of the disposition of the vehicles prior to their sale pursuant to section 679.611, Florida Statutes, but had not been provided with that notice. Had he received the required notice, Mr. Burley would have either objected to the proposed sale or gone to the sale and purchased the vehicles himself because their sale price was less than one-third of the market price. He stated that a commercially reasonable sale would have resulted in a sale of the vehicles for over $40,000 each.

Mr. Burley argued below that his affidavit raised a question of fact whether the sale of the vehicles was commercially reasonable, thus preventing entry of summary final judgment. If the sale was commercially unreasonable, an evidentiary hearing was required in order for Gelco to establish that the fair market value of the vehicles was less than the debt. Nevertheless, the court entered final summary judgment in favor of Gelco, finding that there were no genuine issues of material fact as follows:

f. [Gelco]'s notice of the proposed sale of the Three Vehicles to JOHN BURLEY was insufficient as it did not indicate the specific date, time and place of the sale.

g. Nevertheless, [Gelco] met its burden of proof and established that it disposed of the Three Vehicles in a commercially reasonable manner.

The court awarded Gelco $2,000 in attorney's fees and $357.75 in costs in addition to the deficit of $55,928.80.

Mr. Burley's argument is simple: he asserts that Gelco's failure to provide him with the notice required by section 679.611, Florida Statutes, raised a presumption that the sale of the vehicles was conducted in a commercially unreasonable

976 So.2d 100

manner.2 Therefore, Mr. Burley contends, the trial court erred in proceeding further and finding that Gelco had met its burden of rebutting the presumption because such a determination requires an evidentiary hearing and could not be determined by summary judgment. We believe Mr. Burley is correct.

Article 9 of the U.C.C., codified in chapter 679, Florida Statutes, provides that when the debtor defaults, the secured party can take possession of the secured collateral and can "sell, lease, license, or otherwise dispose of any or all of the collateral...." § 679.610(1), Fla. Stat. (2005). However, the secured party's sale of the collateral must be made in a "commercially reasonable" manner. § 679.610(2), Fla. Stat. (2005). In fact, "[e]very aspect of a disposition of collateral, including the method, manner, time, place, and other terms, must be commercially reasonable." Id. The purpose of these rules is, in part, "to protect the debtor, because they help prevent the creditor from acquiring the collateral at less than its true value or unfairly understating its value so as to...

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7 practice notes
  • Comerica Bank v. Mann, Civil No. 1:11–CV–467–AT.
    • United States
    • United States District Courts. 11th Circuit. United States District Courts. 11th Circuit. Northern District of Georgia
    • September 17, 2013
    ...at less than its true value or unfairly understating its value so as to obtain an excessive deficiency judgment.’ ” Burley v. Gelco Corp., 976 So.2d 97, 100 (Fla.Dist.Ct.App.5th 2008) (quoting Allen v. Coates, 661 So.2d 879, 884 (Fla.Dist.Ct.App.1st 1995)). In order to establish entitlement......
  • Comerica Bank v. Mann, Civil No. 1:11–CV–467–AT.
    • United States
    • United States District Courts. 11th Circuit. United States District Courts. 11th Circuit. Northern District of Georgia
    • September 17, 2013
    ...at less than its true value or unfairly understating its value so as to obtain an excessive deficiency judgment.’ ” Burley v. Gelco Corp., 976 So.2d 97, 100 (Fla.Dist.Ct.App.5th 2008) (quoting Allen v. Coates, 661 So.2d 879, 884 (Fla.Dist.Ct.App.1st 1995) ). In order to establish entitlemen......
  • Spellman v. Indep. Bankers' Bank of Fla., No. 5D11–4358.
    • United States
    • Court of Appeal of Florida (US)
    • August 8, 2014
    ...of the debt or dispose of it in a commercially reasonable manner and credit the debtor's account. See, e.g., Burley v. Gelco Corp., 976 So.2d 97, 100 (Fla. 5th DCA 2008) ; Keller v. La Rissa, Inc., 60 Haw. 1, 586 P.2d 1017, 1020 (1978). A commercially reasonable disposition may include a ju......
  • Textron Financial Corp. v. Lentine Marine Inc., Case No. 08-14246-CIV.
    • United States
    • United States District Courts. 11th Circuit. United States District Courts. 11th Circuit. Southern District of Florida
    • April 20, 2009
    ...were in fact commercially reasonable or that the fair market value of the resold inventory was less than LM's debt. Burley v. Gelco Corp., 976 So.2d 97, 101 (Fla. 5th Under Article 9 of the Uniform Commercial Code, as codified in the Florida statute governing default on security obligations......
  • Request a trial to view additional results
7 cases
  • Comerica Bank v. Mann, Civil No. 1:11–CV–467–AT.
    • United States
    • United States District Courts. 11th Circuit. United States District Courts. 11th Circuit. Northern District of Georgia
    • September 17, 2013
    ...at less than its true value or unfairly understating its value so as to obtain an excessive deficiency judgment.’ ” Burley v. Gelco Corp., 976 So.2d 97, 100 (Fla.Dist.Ct.App.5th 2008) (quoting Allen v. Coates, 661 So.2d 879, 884 (Fla.Dist.Ct.App.1st 1995)). In order to establish entitlement......
  • Comerica Bank v. Mann, Civil No. 1:11–CV–467–AT.
    • United States
    • United States District Courts. 11th Circuit. United States District Courts. 11th Circuit. Northern District of Georgia
    • September 17, 2013
    ...at less than its true value or unfairly understating its value so as to obtain an excessive deficiency judgment.’ ” Burley v. Gelco Corp., 976 So.2d 97, 100 (Fla.Dist.Ct.App.5th 2008) (quoting Allen v. Coates, 661 So.2d 879, 884 (Fla.Dist.Ct.App.1st 1995) ). In order to establish entitlemen......
  • Spellman v. Indep. Bankers' Bank of Fla., No. 5D11–4358.
    • United States
    • Court of Appeal of Florida (US)
    • August 8, 2014
    ...of the debt or dispose of it in a commercially reasonable manner and credit the debtor's account. See, e.g., Burley v. Gelco Corp., 976 So.2d 97, 100 (Fla. 5th DCA 2008) ; Keller v. La Rissa, Inc., 60 Haw. 1, 586 P.2d 1017, 1020 (1978). A commercially reasonable disposition may include a ju......
  • Textron Financial Corp. v. Lentine Marine Inc., Case No. 08-14246-CIV.
    • United States
    • United States District Courts. 11th Circuit. United States District Courts. 11th Circuit. Southern District of Florida
    • April 20, 2009
    ...were in fact commercially reasonable or that the fair market value of the resold inventory was less than LM's debt. Burley v. Gelco Corp., 976 So.2d 97, 101 (Fla. 5th Under Article 9 of the Uniform Commercial Code, as codified in the Florida statute governing default on security obligations......
  • Request a trial to view additional results

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