                                                                                            FILED
                                                                                     O'u €` €fi-F APPEALS
                                                                                         C I' ISION it

                                                                               20111 JUL - i     AN 6: 50

                                                                                   STATE OF WASHIN.GTON

    IN THE COURT OF APPEALS OF THE STATEF

                                                 DIVISION -II

FORD    MOTOR         CREDIT          d/ b /a   PRIMUS                        No. 44773 -8 -II
FINANCIAL SERVICES,


                                  Respondent,


       v.



RAYMOND BRENNEMAN and VALERIE                                           UNPUBLISHED OPINION
BRENNEMAN, husband and wife, and their
marital community composed thereof,

                                  Appellant.




       LEE, J. —      Raymond and Valerie Brenneman appeal the trial court' s order granting

summary judgment to Ford Motor Credit and awarding Ford a deficiency judgment for the

balance due   under     its   motor   vehicle    retail   installment   contract    with   the Brennemans.   The


Brennemans contend that there are material issues of fact concerning whether Ford' s sale of their

repossessed vehicle was commercially reasonable and whether Ford provided proper notice of

that sale. Because no genuine issues of material fact exist, we affirm.


                                                      FACTS


       The Brennemans bought a 2004 Volvo automobile from Barrier Volvo on December 6,


2007. In connection with this purchase, the Brennemans signed a retail installment contract that


set forth the terms of the purchase and the installment payments they agreed to make. Ford is the

creditor with respect   to the Brennemans' ,loan.
No. 44773 -8 -II




         The Brennemans assert that they took the car back to Barrier for warranty repair of its

transmission      in the fall      of   2008.     The Brennemans also claim that after a month -long delay,

Barrier informed them that              a replacement       transmission       was .on     back   order.   The Brennemans


grew    tired of waiting and        surrendered possession of            the     car   to Barrier.   They believed that by

surrendering possession and foregoing a lemon law claim, they satisfied their obligations under

the   retail   installment    contract.        Ford repossessed the car on November 3, 2008, and sent the


Brennemans a notice of its plan to sell the vehicle on November 5, 2008.


          Ford arranged for the car to be sold at auction by Manheim Seattle, which conducts

weekly    vehicle       auctions   in Washington       and other       states.    The    car sold    for $ 13, 000,   leaving a

balance    of more      than $ 10, 000       due on the Brennemans' retail installment contract. Ford mailed a


statement of sale to the Brennemans that set forth those figures and the deficiency they owed.

          When the Brennemans did not pay the deficiency, Ford sued to recover the monies due

under    the   retail   installment     contract.    The Brennemans responded by raising several defenses,

including claims that Ford' s action was barred by its failure to give proper notice of the sale and

that the sale was not commercially reasonable under the Uniform Commercial Code.

          Ford moved for summary judgment and provided documents showing that it mailed the

notice of its plan to sell the car, as well as the statement of sale, to the address on the


Brennemans' vehicle registration. Ford added that the car was sold " as is" to the highest bidder,


and that the sale " was through an experienced dealer in a recognized market in a commercially

reasonable      manner."       Clerk'    s   Papers ( CP)   at   33.    Ford also provided a certification from its


business records custodian stating that it had demanded payment on the contract and that the

Brennemans had refused or been unable to pay.



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No. 44773 -8 -II



           The Brennemans responded that they did not receive notice of the sale because it was

sent to an address where they had resided " in the past" rather than their current mailing address,

which      is the   address   included in their     contract with    Ford.    CP at 49. They also asserted that their

surrender of the car to the dealer satisfied their contract obligations with Ford.


           During the hearing on Ford' s motion, the Brennemans acknowledged that nothing in the

contract or the law stated that surrender of the car would take care of any outstanding contractual

obligations.        Nor could they cite any law stating that a car' s defect allows an owner to void a

related     sales    contract.    The trial court granted Ford summary judgment on the issue of the

Brennemans' liability, but it requested additional briefing concerning the car' s value and the

appropriate judgment amount.


           The Brennemans then moved for reconsideration and asserted that issues of fact remained


as to whether they had actually defaulted on the contract, whether Ford' s sale of the car was

commercially         reasonable, and whether          they had     adequate notice of       the   sale.   They argued that

their car payments were timely until they surrendered possession, and that they never received a

notice of default. They also maintained that the car' s inoperative transmission had to be fixed to

make Ford' s sale of the car commercially reasonable, and that the vehicle registration form that

Ford submitted was not authentic.


            In a separate memorandum addressing the car' s value, the Brennemans contended that
                                                                                        1
the   value    at   the time     of sale,   based    on   the   current "   Blue Book "     figure, was approximately



1
     The    Brennemans'          memorandum cites to both the Kelley Blue Book and the National
Automobile Dealer Association (NADA) valuations. We refer to the average of these valuations
as   the " Blue Book" for        ease of reference.
No. 44773 -8 -II



 23, 000.    CP    at    76, 77.    They asserted in the alternative that the car was defective and had no

retail commercial value.




        Ford' s response concerning the car' s value attached the auctioneer' s condition report

stating that the vehicle was drivable and that its overall condition was average at the time of sale.

The   report also showed           that the   car was valued at $      10, 650 before the   auction.   Ford argued that


the car was not defective and not without value.

        In response to the Brennemans' motion for reconsideration, Ford again asserted that it


had shown the car was operable at the time of default and that the Brennemans had provided no

competent evidence          to   support      their   claim   to the contrary.   Ford also argued that it had shown,


with the certification from its business records custodian, that the Brennemans were in default.

Ford added that the vehicle registration it had submitted was valid but argued that even if its


notice of the sale was insufficient, the Brennemans had not disclosed any resulting loss.

        The trial court denied the Brennemans' motion for reconsideration and concluded that the


value   of   the   car    was    established     by    the commercially     reasonable   sale.   The court ultimately

entered a judgment of $14, 389. 07 in Ford' s favor.

        On appeal, the Brennemans argue that material issues of fact remain on the issues of


commercial reasonableness and notice that preclude summary judgment and the entry of a

deficiency judgment against them.




                                                                  4
No. 44773 -8 -II




                                                  ANALYSIS


1.   STANDARD OF REVIEW


         When reviewing a summary judgment order, we engage in the same inquiry as the trial

court, on   the   same record.   Marshall   v.   Bally' s    Pacwest, Inc.,      94 Wn. App. 372, 377, 972 P.2d

475 ( 1999).      A summary judgment order can be granted only if the pleadings, affidavits,

depositions, and admissions on file show the absence of any genuine issues of material fact, and

that the moving party is entitled to judgment as a matter of law. Marshall, 94 Wn. App. at 377.

The motion should be granted only if, from all the evidence, reasonable persons could reach but

one conclusion.      Wojcik v. Chrysler     Corp.,     50 Wn.         App. 849, 854,   751 P. 2d 854 ( 1988).      The


court must consider all facts submitted and all reasonable inferences from the facts in the light


most   favorable to the nonmoving party.          Nivens v. 7 -11 Hoagy' s Corner, 133 Wn.2d 192, 198,

943 P. 2d 286 ( 1997).


         After the moving party has submitted adequate affidavits, the nonmoving party must set

forth specific facts rebutting the moving party' s contentions and disclosing the existence of

issues   of material   fact.   Marshall, 94 Wn.        App.      at   377.   A nonmoving party may not rely on

speculation or on argumentative assertions            that   unresolved      factual issues   remain.   White v. State,


131 Wn.2d 1, 9, 929 P. 2d 396 ( 1997).           Although CR 56( e) requires an affidavit submitted in a


summary judgment proceeding to be based on personal knowledge, to set forth admissible

evidentiary facts, and to show that the affiant is competent to testify as to his averments, courts

generally will indulge in some leniency with respect to affidavits presented by the nonmovant.

Pub. Util. Dist. No. 1 of Lewis      County.     v.   Wash. Pub. Power          Supply Sys. (   WPPSS), 104 Wn.2d




                                                             5
No. 44773 -8 -II



353, 360 -61, 705 P. 2d 1195, 713 P.2d 1109 ( 1985).                           Such leniency does not extend, however, to

affidavits   containing inadmissible            evidence        or   conclusory      statements.     WPPSS, 104 Wn.2d at


361.


           In responding to Ford' s motion for summary judgment, the Brennemans submitted an

unsworn affidavit that was not signed under penalty of perjury. See GR 13 ( unsworn affidavit is

permitted    if   signed under       penalty   of   perjury).    The Brennemans attached an identical declaration


that was signed under penalty of perjury to their reply to Ford' s response to their motion for

reconsideration.          We will consider these filings in determining whether issues of fact remain

concerning the commercial reasonableness of the sale or Ford' s notice thereof.

2. COMMERCIAL REASONABLENESS


           The Uniform Commercial Code requires a creditor to dispose of a defaulting debtor' s

collateral   in    a "   commercially     reasonable"      manner.             RCW 62A. 9A- 610( b); Sec. State Bank v.


Burk, 100 Wn.            App.   94, 95, 995 P. 2d 1272 ( 2000).                The fact that a greater amount could have


been obtained by a disposition at a different time or in a different method from that selected is

not alone sufficient to preclude the creditor from establishing that the disposition was made in a

commercially            reasonable    manner.         RCW       62A.9A- 627( a).          A disposition of collateral is


commercially reasonable if it is made in the usual manner in any recognized market, at the price

current in any recognized market at the time of the disposition, or is otherwise in conformity

with reasonable commercial practices among dealers in the type of property that was the subject

of   the   disposition.         RCW 62A.9A- 627( b).            In sum, the commercial reasonableness of a sale


depends     on    the    procedures employed and not on                  the   proceeds generated.   Leasing Serv. Corp. v.




                                                                     6
No. 44773 -8 -II




Diamond Timber, Inc., 559 F.              Supp.      972, 979 ( S. D.N.Y. 1983) (           citing Foster v. Knutson, 84

Wn.2d 538, 527 P. 2d 1108 ( 1974)),             all'd, 729 F.2d 1442 ( 2d Cir. 1983).

           The burden of proving commercial reasonableness is on the creditor, who is in the

better position to know and control the nature of resale, and is the one asserting the deficiency

judgment. "'   Sec. State Bank, 100 Wn. App. at 101 ( quoting Rotta v. Early Indus. Corp., 47 Wn.

App.    21, 24, 733 P. 2d 576,       review    denied, 109 Wn.2d 1012 ( 1987)).                When the propriety of the

secured party' s disposition of collateral is contested, the issue of commercial reasonableness

should   be determined          as a matter of   law only in the      clearest of cases.       Sec. State Bank, 100 Wn.


App. at 101.

          In arguing that its          sale    was    commercially          reasonable,      Ford pointed out that the


Brennemans signed a contract stating that Ford could repossess and sell the car if they violated

their   obligations       thereunder.         Ford   placed    the    car    with    an    experienced   auctioneer,   and



information    about      the   car was available online       before the      sale.      The car was sold " as is" to the


highest bidder. CP at 33.


          The Brennemans responded that Ford had to replace the car' s defective transmission


before selling it because the duty to recondition collateral is an essential component of

commercial reasonableness.              To support this argument on appeal, they cite authority providing

that if the cost of preparing the collateral for sale is small in comparison to the additional price it

may     generate,   the   creditor should spend         the   extra   money.        Westgate State Bank v. Clark, 231


Kan. 81, 92, 642 P. 2d 961, 970 ( 1982);              see also Union Nat' l Bank of Wichita v. Schmitz, 18 Kan.

App.    2d 403, 405, 412, 853 P. 2d 1180, 1182, 1187 ( 1993) ( sale of car in " fair to poor shape" was


commercially        reasonable where creditor           spent $    15 to have it       washed and vacuumed).       As the




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No. 44773 -8 -II



Westgate      court explained, "[      W] ashing and cleaning up consumer goods or equipment may be the

only commercially reasonable thing to do in order to generate bidder interest at the sale."

Westgate State Bank, 642 P. 2d            at   970. These cases do not support the argument that Ford had to


recondition the car before its sale at auction.


            The Brennemans'           argument regarding the impact of the defective transmission on the

issue of commercial reasonableness is also unavailing because it depends largely on hearsay

statements      from the   unnamed mechanic who                allegedly inspected their    car.   As Ford asserts, the


Brennemans presented no competent evidence to support their assertion that their vehicle was


defective.      They attach to their appellate brief a notice of a class action settlement reached with

Volvo concerning failing transmissions, but that document was not before the trial court and may

not    be   considered on appeal.         Riojas      v.   Grant   County   Pub. Util. Dist.,   117 Wn. App. 694, 696

n.   1, 72 P. 3d 1093 ( 2003),    review       denied, 151 Wn.2d 1006 ( 2004); RAP 9. 12.


            Furthermore, the Brennemans' statements regarding the car' s condition at the time of sale

are speculative because they do not know whether the transmission, even if defective, was in fact

replaced before the car was sold. Moreover, the Brennemans assert contradictory positionsthat

the car was worth the Blue Book figure for a car in excellent condition and that the car had no

                                  2
retail      commercial   value.         By contrast, Ford submitted documentation addressing the car' s



2 Ford complains for the first time on appeal that Blue Book documents attached to the
Brennemans'        memorandum were              not    properly    authenticated under    ER 901.     The Brennemans

respond that these documents are from self -
                                           authenticating periodicals and that this court has
determined that the Blue Book figure is convincing evidence of                          value.     ER 902( f); McChord
Credit Union v. Parrish, 61 Wn. App. 8, 15, 809 P. 2d 759 ( 1991).                       Even if these documents are
properly before us, they do not create an issue of fact. In McChord Credit Union, the Blue Book
value was $      1000 greater than the sale price, and the court found no reason for the discrepancy



                                                                   8
No. 44773 -8 -II



condition        at    the time    of sale.       Thus, the Brennemans' conflicting and speculative assertions,

based      largely       on    hearsay, fail to create a question of fact on the issue of commercial

reasonableness.



3. NOTICE


           The Brennemans argue that there are issues of material fact regarding whether Ford

complied with the Uniform Commercial Code in providing proper notice of their default, Ford' s
                                                                                                               3
acceleration of          the underlying debt,          and   the intended sale         of   their   vehicle.




           The Uniform Commercial Code requires a creditor that disposes of repossessed collateral


to   send notification of          the    planned        disposition to the debtor.             RCW 62A. 9A- 611( b); Rotta, 47


Wn.       App.    at    24.    A   person       gives    notification        to    another "   by taking such steps as may be

reasonably required to inform the other in ordinary course whether or not such other actually

comes      to know        of   it." Former 62A. 1- 201( 26) ( 2011) (                 recodified as RCW 62A. 1- 202( 3)( d) by

Laws      of   2012,     ch.   214, §     110).       Consequently, notice may be effective even though it is not

received       if the    creditor acted     reasonably in         trying      to   send   notice.     27 MARJORIE D. ROMBAUER,


WASHINGTON PRACTICE:                      CREDITORS' REMEDIES - DEBTORS' RELIEF, §                                 3. 126    at   273 ( 1998).


The Uniform Commercial Code defines " send" as follows:




based     on   the     description   of   the   car   in the
                                                           App. at 15.
                                                               record.       61 Wn.                     The Brennemans' assertion
that their car was worth the Blue Book value is entirely speculative.
3
     As   support,       the Brennemans           cite   U.C. C. §   9 -504         and   RCW 62A. 9A. 611.                 U. C. C. §   9 -504
addresses the description of collateral that a financing statement should provide and is not
pertinent        here.        RCW 62A.9A.611 addresses the notice of disposition requirements and is
discussed        above.       The Brennemans cite no authority to support their argument that the Uniform
Commercial Code required Ford to provide separate notice of their default or its acceleration of
the debt, so we do not address these claims of error.    RAP 10. 3( a)( 6); Cowiche Canyon

Conservancy v. Boseley, 118 Wn.2d 801, 809, 828 P.2d 549 ( 1992).



                                                                         9
No. 44773 -8 -II




             Send" in connection with any writing or notice means to deposit in the mail or
        deliver for transmission by any other usual means of communication with postage
        or cost of transmission provided for and properly addressed and in the case of an
        instrument to an address specified thereon or otherwise agreed, or if there be none
        to any address reasonable under the circumstances.

Former RCW 62A. 1 - 201( 3 8) ( 2011).


            When the Brennemans argued that they never received notice of Ford' s plan to sell the

vehicle at public auction, Ford provided a copy of the notification showing that it was sent to

them   at   the    address       listed     on   the   vehicle registration.        The Brennemans asserted that while they

had lived     at   that     address "       in the     past,"   they were living at a different address at the time of the

notification.        CP     at   49.   On appeal, they refer to their argument that the registration form was

fraudulent, but they have provided no facts to support their claim of fraud and no explanation as

to how a former address was included in their vehicle registration if they did not provide it

themselves.



            Ford persuasively argues that it was reasonable to send the notification to the address

listed on the vehicle registration and that, as stated above, actual receipt of notification is not


required     if it   acted       reasonably in          trying   to   send notice.     Ford also argues that even if its notice


was deficient, the remedy is limited to the Brennemans' loss resulting from the deficiency.

McChord Credit Union                   v.   Parrish, 61 Wn.            App.    8, 14, 809 P. 2d 759 ( 1991).   The Brennemans


claimed no such loss below.


            The Brennemans contend for the first time on appeal that with proper notification, they

could have exercised their right of redemption or ensured that the faulty transmission was

replaced      so     that    a    higher         resale   price       could   be   obtained.   This contention seems highly

speculative given their belief that surrender of the car satisfied their contractual obligations. But,




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No. 44773 -8 -II




even if such steps were likely, we may not consider this untimely assertion in reviewing the trial

court' s   decision.    Hanson Indus.,    Inc. v. Kutschkau, 158 Wn. App. 278, 290, 239 P. 3d 367

 2010), review denied, 171 Wn.2d 1011 ( 2011).


           We conclude that there are no issues of material fact concerning Ford' s compliance with

the Uniform Commercial Code in notifying the Brennemans about the intended sale of the

vehicle. Consequently, we need not address the Brennemans' argument, again raised for the first

time   on   appeal,    concerning Ford'   s   failure to   obtain   a   timely   appraisal   of   the   vehicle.   See


McChord Credit Union, 61 Wn. App. at 14 ( creditor that violates the Uniform Commercial Code

faces a rebuttable presumption that the value of the collateral at or near the time of repossession


is at least equal to the amount of the outstanding debt).

           We affirm.


           A majority of the panel having determined that this opinion will not be printed in the

Washington Appellate Reports, but will be filed for public record in accordance with RCW


2. 06. 040, it is so ordered.




We concur:




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