
                                             SECOND DIVISION      

                                             OCTOBER 8, 1996 

                                                   

 

 

 

1-95-4140 

1-95-4197 

 

GAINER BANK, N.A.,            

 

     Plaintiff-Appellee, 

 

     v. 

 

DARLENE JENKINS, 

 

     Defendant-Appellant.

 

)   Appeal from the 

)   Circuit Court of 

)   Cook County. 

) 

)   No. 93 CH 1837 

) 

)   The Honorable 

)   John Hourihane, 

)   Judge Presiding. 

     JUSTICE DiVITO delivered the opinion of the court: 

 

     In this interlocutory appeal we are asked to determine 

whether, under the circumstances present here, an Indiana holder of 

a retail installment sales contract was required to comply with the 

Illinois Motor Vehicle Retail Installment Sales Act (Ill. Rev. 

Stat. 1991, ch. 121, par. 561 et seq. (now 815 ILCS 375/1 et seq. 

(West 1994))) (the Act) before repossessing a car in Illinois.  For 

the reasons that follow, we conclude that the provisions of the Act 

do not apply in this case. 

     In July 1987, defendant Darlene Jenkins entered into a retail 

installment sales contract for the purchase of a used 1984 Buick 

with Schepel Buick, Inc., an automobile dealer in Merrillville, 

Indiana.  The cost of the Buick was $8,500, plus 14.90% annual 

interest, to be paid in 48 payments.  Schepel Buick immediately 

assigned the contract to plaintiff Gainer Bank, N.A., an Indiana 

bank.   

     In November 1987, plaintiff purchased "force placed" insurance 

for the Buick, believing that defendant failed to furnish an 

insurance policy as required by the contract.  By April 1991, the 

premiums for the insurance, which were added to defendant's loan 

balance, totalled almost $4,200.  In January 1991, when defendant 

failed to make payments, plaintiff obtained a default judgment for 

the Buick's possession in Indiana and had it repossessed in 

Illinois and sold at a public auction. 

     In June 1991, plaintiff filed the instant action seeking 

payment of the deficiency balance of the contract, including the 

amount of the insurance.  Later, after receiving proof that 

defendant was insured during the time she had possession of the 

Buick, plaintiff amended its complaint to credit her for the costs 

of the insurance.   

     In May 1993, defendant filed an answer and affirmative 

defenses and counterclaimed, individually and on behalf of a class 

of persons allegedly injured by plaintiff.  In count V of her 

counterclaim, she contended that plaintiff's repossession and sale 

of the Buick violated the Illinois Consumer Fraud and Deceptive 

Business Practices Act (815 ICLS 505/1 et seq. (West 1994)) by 

failing to comply with the Act.  Count VI, in which defendant 

alleged conversion, was based in part on purported violations of 

the Act.  Her fifth, part of her sixth, and her eighth affirmative 

defenses also raised the Act as a bar to plaintiff's collection of 

a deficiency judgment.  

      In August 1993, plaintiff moved to dismiss counts I through 

V of defendant's counterclaim and to strike her first through 

fifth, part of her sixth, and her eighth and ninth affirmative 

defenses.  Finding that the Act was inapplicable to the instant 

case, the circuit court dismissed and struck those portions of 

defendant's filings that were predicated upon it: count V and part 

of count VI of the counterclaim and the fifth, part of the sixth, 

and the eighth affirmative defenses.       

     Pursuant to Supreme Court Rule 308 (134 Ill. 2d R. 308), the 

circuit court certified for appeal the question of whether section 

20 of the Act applies to this case.  We granted defendant's motion 

for leave to appeal and this interlocutory appeal followed.   

     The sole question presented in this appeal is whether section 

20 of the Act applies to a motor vehicle retail installment sales 

contract where the contract was entered into and payments were made 

in Indiana, but the vehicle at issue was titled, insured, kept, and 

repossessed in Illinois. 

     The Act was enacted to protect the unsophisticated motor 

vehicle consumer from the oppressive and unscrupulous practices of 

the installment seller.  Chrysler Credit Corp. v. Ross, 28 Ill. 

App. 3d 165, 168-71, 328 N.E.2d 65 (1975).   

     Section 20 of the Act provides that a holder of a motor 

vehicle retail installment sales contract must comply with certain  

requirements before repossessing a car or selling it.   Ill. Rev. 

Stat. 1991, ch. 121, par. 580 (now 815 ILCS 375/20 (West 1994)).  

Where the holder fails to comply with the requirements of section 

20, the buyer of the car is not liable for any finance, 

delinquency, collection, or refinancing charges connected with the 

contract.  Ill. Rev. Stat. 1991, ch. 121, par. 584 (now 815 ILCS 

375/24 (West 1994)).   Here, defendant contends that because 

plaintiff failed to comply with section 20, it may not collect a 

deficiency judgment.   

     Plaintiff first contends that the Act is inapplicable because 

it does not create a private right of action.  Arca v. Colonial 

Bank & Trust Co., 265 Ill. App. 3d 498, 502, 637 N.E.2 687 (1994).  

Because defendant is not suing under the Act, but invokes it merely 

to prove violations of the Consumer Fraud and Deceptive Business 

Practices Act (815 ILCS 505/1 et seq. (West 1994)) and to bar 

plaintiff from collecting a deficiency judgment, plaintiff's 

argument fails. 

      Both parties agree that in order for the Act to apply, the 

instant contract must fall within the ambit of section 2.5.  That 

section provides that a retail installment contract "means an 

instrument or instruments prescribing the terms of a retail 

installment transaction and entered into or to be performed in this 

State."  (Emphasis added.)  Ill. Rev. Stat. 1991, ch. 121, par. 

562.5 (now 815 ILCS 375/2.5 (West 1994)).  Here, the installment 

contract for the sale of the Buick (the contract) was not entered 

into in Illinois.  Thus, the Act applies only if the contract was 

"to be performed" in Illinois.      

     The contract, which is a boilerplate contract of adhesion, 

provided that payments were to be made to plaintiff in Indiana.  

Under a section entitled "Additional Terms and Conditions," the 

contract further provided that the buyer agreed to a number of 

conditions, including not selling the car until liabilities were 

paid in full, not granting a lien on it, paying all necessary 

taxes, keeping it fully insured, keeping it at the address 

provided, notifying plaintiff of any change in address, and not 

removing it without the written consent of plaintiff.  In this 

case, each of these obligations was performed in Illinois. 

     We note, however, that although the buyer was required to 

comply with the conditions of the contract, there was no 

requirement that she do so in Illinois.  Defendant could have taken 

the Buick to any state, provided that she complied with the 

provisions requiring her to register, title, and insure it and keep 

it at the address she provided.  Because portions of the instant 

contract were performed in Illinois, however, we turn to the 

question of whether performance of some contractual provisions in 

Illinois is sufficient to bring a transaction within the Act's 

purview.   

     In a contract for the repayment of money lent, "[r]epayment is 

the ultimate aim and objective of the contract."  Restatement 

(Second) of Conflict of Laws 195, Comment b, at 620-21 (1971).  

Where the ultimate object of a contract is the payment of money, 

the contract is to be performed where payment is made.  Reighley v. 

Continental Illinois National Bank & Trust Co., 390 Ill. 242, 250, 

61 N.E.2d 29 (1945); George v. Haas, 311 Ill. 382, 386, 143 N.E. 54 

(1924). Here, the chief purpose of the contract was repayment of 

the loan to purchase the Buick.  Because the additional conditions 

were intended to protect plaintiff's interest in the car, we 

conclude that those conditions, which were incidentally performed 

in Illinois, were not an integral part of the contract.  That those 

ancillary conditions were to be performed in Illinois is 

insufficient to bring the contract within the purview of the Act.  

Accordingly, because payments in this case were made in Indiana and 

the contract was to be performed in Indiana, the Act does not 

apply.     

     The cases cited by defendant wherein courts held that the law 

of the state of repossession governs the issues of the legality of 

the repossession and the sale of the vehicle, even where the 

vehicle was purchased in another state, are not helpful. Dunn v. 

Security Pacific Housing Service, No. 94C-05-113 (Del. Super. Ct. 

September 27, 1995); General Motors Acceptance Corp. v. Robinson, 

263 A.2d 302 (Del. Super. Ct. 1970); United Securities Corp. v. 

Tomlin, 57 Del. 219, 198 A.2d 179 (Del. Super. Ct. 1964).  In each 

of the cited cases, the courts applied choice of law principles in 

reaching their determination. 

     Here, in contrast, we interpret a specific statutory provision 

which, in stating that it applies only to contracts entered into or 

to be performed in Illinois, circumscribes its own geographic 

applicability.  That limitation must be given the range of 

application intended by the legislature.  Restatement (Second) of 

Conflict of Laws 6, Comment b, at 11 (1971).  Had the legislature 

intended the Act to have a broader reach, it could have so 

provided.  See, e.g., 815 ILCS 710/3 (West 1994) (providing that 

the Motor Vehicle Franchise Act applies to "any person who engages 

directly or indirectly in purposeful contacts within this State").  

     Finally, although defendant urges us to invoke the Act because 

of public policy concerns, the Act's primary purpose is to regulate 

the content of motor vehicle retail installment contracts; the 

buyer's rights upon default are but one section of it.  Cf. Ill. 

Rev. Stat. 1991, ch. 121, par. 563 (now 815 ILCS 375/3 (West 

1994)) (general requirements of contract); Ill. Rev. Stat. 1991, 

ch. 121, par. 564 (now 815 ILCS 375/4 (West 1994)) (identification 

of parties and subject matter of contract); Ill. Rev. Stat. 1991, 

ch. 121, par. 565 (now 815 ILCS 375/5 (West 1994)) (terms and 

conditions of contract); Ill. Rev. Stat. 1991, ch. 121, par. 580 

(now 815 ILCS 375/20 (West 1994)) (buyer's remedies upon default).  

It would be improper for Illinois courts, in invoking the Act, to 

regulate the minutia of contracts entered into and performed in 

Indiana, simply because a consumer takes the purchased property to 

Illinois, then breaches her obligation to make payments.  Thus, in 

the absence of specific authorizing legislation, we decline to 

provide a breaching party the power to control the law applicable 

to a contract by moving the purchased property to a state other 

than the one in which the contract was made, thereby forcing a 

creditor to repossess in the state where the property is kept.   

     Accordingly, we answer the certified question in the negative: 

the Act does not apply to the repossession of a car in Illinois 

where the motor vehicle retail installment sales contract was 

entered into and payments were made in Indiana, even though 

conditions peripheral to the contract were fulfilled and the 

repossession occurred in Illinois.  The judgment of the circuit 

court is affirmed. 

     Affirmed. 

     HARTMAN, P.J., and BURKE, J., concur. 

       

 

