Ellis Contracting, Inc. v. Komatsu Financial
| Docket Number: | 2003-CA-02064-COA | |
| Court of Appeals: |
Opinion Link Opinion Date: 12-14-2004 Opinion Author: Bridges, P.J. Holding: Affirmed |
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| Additional Case Information: |
Topic: Contract - Repossession - Defense - Breach of peace Judge(s) Concurring: Lee, P.J., Irving, Myers, Chandler, Griffis, Barnes and Ishee, JJ. Dissenting Author : King, C.J. Procedural History: Summary Judgment Nature of the Case: CIVIL - CONTRACT |
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| Trial Court: |
Date of Trial Judgment: 09-04-2003 Appealed from: Sunflower County Circuit Court Judge: Richard Smith Disposition: PLAINTIFF’S MOTION FOR SUMMARY JUDGMENT GRANTED Case Number: 2002-0310 CI |
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| Party Name: | Attorney Name: | |||
| Appellant: | Ellis Contracting, Inc. |
NATHAN P. ADAMS
PHILIP MANSOUR |
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| Appellee: | Komatsu Financial | STEPHEN E. GARDNER SUZETTE FARIES BRELAND |
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Synopsis provided by:  If you are interested in subscribing to the weekly synopses of all Mississippi Supreme Court and Court of Appeals hand downs please contact Tammy Upton in the MLI Press office. |
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| Topic: | Contract - Repossession - Defense - Breach of peace |
| Summary of the Facts: | Komatsu Financial financed Ellis Contracting’s purchase of excavating equipment. Ellis defaulted and Komatsu unsuccessfully attempted self-help repossession. Komatsu filed a complaint in replevin, to which Ellis answered and counterclaimed. Komatsu filed a motion for summary judgment which the court granted. Ellis appeals. |
| Summary of Opinion Analysis: | Ellis argues that the court should not have granted Komatsu’s motion for summary judgment because the court erroneously determined that Ellis did not offer a valid defense against Komatsu’s claim to immediate possession of the equipment. Ellis maintains that they offered a valid defense - full payment under the contract. When one party establishes a debt and the debtor claims payment nullifies the debt, the burden of proving payment falls on the debtor. However, where the debtor has introduced some evidence of payment, the burden shifts to the creditor to show nonpayment. Komatsu presented an accounting that demonstrated that Ellis did owe a balance on the debt. Komatsu also presented evidence that Ellis was aware of Komatsu’s position on the cancellation letter - that is, mistake in sending the cancellation letter. Therefore, no issue of material fact existed. Ellis also argues that the court should not have dismissed its counterclaim because a jury should have the opportunity to resolve whether Butler breached the peace and whether Butler had completed repossession. Upon default, a secured party has the right to take possession of the collateral without judicial process if the secured party can avoid breaching the peace in the process. Here, Butler repossessed the excavator and moved it off Ellis’s lot without anyone being aware of it. No one witnessed Butler moving the excavator off the landfill site, no one confronted Butler as they removed the excavator, and no one pursued Butler as they left the Ellis’s property with the excavator. Ellis did not confront Butler until Butler was on an interstate highway - fifty-seven miles away from the Ellis landfill. There is no statutory authority or precedent that states that repossession is incomplete until the repossessors successfully move repossessed collateral across the boundary of their own real property and effectively reach “home base.” Because a creditor can only be liable for damages that result from a breach of the peace that occurs during repossession, Komatsu cannot be liable even if a jury found that Butler breached the peace during the I-55 incident. |
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