Did the Repo Man Just Ghost Me? Technology's Contribution to Vehicle Repossession and How It Impacts the UCC

By Harper, Laura | The Review of Litigation, Spring 2019 | Go to article overview

Did the Repo Man Just Ghost Me? Technology's Contribution to Vehicle Repossession and How It Impacts the UCC


Harper, Laura, The Review of Litigation


INTRODUCTION................... 373

I.THE HISTORY BEHIND ARTICLE 9'S "BREACH OF THE PEACE"..... 375

II.THE AGE OF TECHNOLOGY, STARTER-INTERRUPTER DEVICES, AND THEIR IMPACT...................377

III.ARE CREDITORS VIOLATING BREACH OF THE PEACE?...................380

IV.MOVING FORWARD WITH TECHNOLOGY AND THE UCC...................383

CONCLUSION...................384

INTRODUCTION

In recent years, modern technology has impacted daily life to a previously unprecedented degree.1 At the turn of the 21st century, increased accessibility to technology-based devices enabled businesses to implement new procedures and policies into their practices. The vehicle-repossession industry was no exception. There, newly invented "starter-interrupter devices"-small devices capable of halting a vehicle's mobility-greatly minimized the practice of physical repossession by instead allowing creditors to "repossess" collateral from remote locations.2 The car-loaning industry has praised this procedural shift, claiming that these devices provide both a more efficient repossession process, as well as allow creditors to extend loans to a larger class of borrowers.3 However, others have raised concerns over their use, arguing that these devices lead to potentially life-threatening and dangerous circumstances that jeopardize public safety.4

Article 9 of the Uniform Commercial Code allows a secured party to use self-help repossession, but only if repossession can be completed without "breach of the peace."5 Although starter-interrupter devices are relatively new, and case law regarding their use has yet to mature, objections to the practice have been well established. These objections often arise in factual situations that parallel traditional breach-of-the-peace cases-situations involving an actual individual, the "repo man," who collects the vehicle6-with one distinction: the repo man is replaced by a starter-interrupter device. While these devices have sparked the interest of consumer and privacy rights advocates, this note argues that these devices also provide borrowers with a claim under Article 9 of the UCC.7

The proceeding sections explore the history and policy behind breach of the peace and argue that secured parties who use starterinterrupter devices should be held to the same standards that courts have used to scrutinize traditional means of repossession. Part II provides a brief introduction to the policy behind breach of the peace, and how this policy has impacted courts' analysis in repossession cases. Part III describes starter-interrupter devices, along with the benefits and complications that stem from their use. Part IV analyzes the similarities between the situations that these devices have created with breach-of-the-peace physical repossession cases. Part V concludes the article by first suggesting, that regardless of the form of repossession used, courts should hold creditors to the same breach-of-the-peace standard established by past precedent, and second, that GPS tracking devices, which grant many of the same benefits as starter-interrupter devices, are in fact the better alternative for the vehicle-repossession industry.

I. THE HISTORY BEHIND ARTICLE 9'S "BREACH OF THE PEACE"

Article 9 of the UCC heavily favors the secured party.8 Following a debtor's default, Article 9 allows secured parties to repossess collateral in one of two ways - either by (1) self-help repossession or (2) through the more traditional judicial court process.9 While the UCC recognizes longstanding values in self-help repossession,10 the Article imposes a substantial limiting requirement on secured parties who use it: Creditors may only resort to self-help when repossession can be performed without a "breach of the peace."11 However, with the exception of a few vague remarks in comment 3 of section 9-609, the drafters of the UCC failed to clearly define the term.12 Consequently, this job was left to the courts, making "breach of the peace" an attractive candidate for litigation disputes. …

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