Academic journal article Washington Law Review

Defining "Breach of the Peace" in Self-Help Repossessions

Academic journal article Washington Law Review

Defining "Breach of the Peace" in Self-Help Repossessions

Article excerpt

Abstract: Since Roman times, creditors have invoked the limited extrajudicial remedy of self-help repossession. Pre-colonial English laws also allowed for a limited repossession remedy outside of the courts, provided the creditor accomplished the repossession without a "breach of the peace." The Uniform Commercial Code (UCC) has allowed for the self-help remedy since the 1950s, making it available for any secured party in the event of contractual default so long as there was no breach of the peace. The drafters of the UCC, however, failed to define what constituted a "breach of the peace," choosing to allow the courts to flesh out the definition in a fact specific, ex post fashion. This has resulted in a lack of clarity and consistency across jurisdictions as each court attempts to cran a breach of the peace requirement without guidance from the UCC. This Comment argues that courts across the country should adopt a two-part test for determining whether a breach of the peace occurred during self-help repossession. The two-part test involves three per se rules of exclusion followed by consideration of two factors to reach a final decision.

INTRODUCTION

The concept of self-help repossession has existed in law and society since Roman times.1 Repossession is "[t]he act or an instance of retaking property"2 and self-help is "[a]n attempt to redress a perceived wrong by one's own action rather than through the normal legal process."3 Throughout history, this concept has allowed individuals to regain possession of their rightful and legal property without resorting to a formal judicial process. Appearing in the Roman Empire,4 the concept evolved over time as it progressed through other societies,5 into English law,6 and then finally into the common law of the United States.7 Congress first recognized the self-help repossession remedy in the Uniform Conditional Sales Act,8 and it is presently codified in section 9-609 of the Uniform Commercial Code (UCC).9

The UCC established a very formal process for self-help repossession. Only secured parties have the option of self-help repossession.10 In order to become secured, the party must form a security interest." Only then does the debtor12 have a specified obligation, as defined by the security interest, to the secured party.13 If debtor default14 occurs, then the secured party has certain rights to the collateral,15 which could be in the debtor's possession.16 One of the secured party's rights is self-help repossession. Section 9-609 of the UCC states that "[a]fter default, a secured party . . . may take possession of the collateral . . . pursuant to judicial process; or ... without judicial process, if it proceeds without breach of the peace."17

This Comment focuses on the difficulty courts have in defining the term "breach of the peace" within the meaning of the UCC. For example, if a repossession agent asks the police to provide him with protection as he repossesses a vehicle, is this a breach of the peace that makes the self-help repossession unlawful? Does a breach of the peace occur when a homeowner assaults someone trespassing on his property in an effort to repossess lawn furniture? Imagine that the same homeowner does not notice his property being repossessed, but the creditor has to cut a lock and bypass a gate to repossess the property. Does this breach the peace even if there is no confrontation? What if the debtor experiences emotional distress or something happens to a neutral third party? Chapa v. Traders & Associates(TM) illustrates the difficulty courts face in defining and applying the "breach of the peace" concept. In that case, a repossession agent performed a self-help repossession and towed the debtor's vehicle away while - unbeknownst to the agent - the debtor's children were still inside.19 The court decided that the agent's actions did not constitute a breach of the peace,20 even though the debtor likely experienced extreme emotional distress from thinking that her children had been abducted. …

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