The borrower purchased a car under a financing agreement with the lender, giving the lender a security interest in the car. Under the agreement, the lender could repossess the car if the borrower failed to adhere to the agreement. Specifically, if the borrower allowed another security interest on the car, the lender could take immediate possession of the vehicle. Several years later, the borrower crashed the car, and the police department towed the car to a local tow yard. The tow yard attempted to contact the borrower about storage fees and inform the borrower that the tow yard would sell the vehicle at auction if fees were not paid, but the borrower never received any communications. The borrower never contacted the tow yard and never paid any of the storage fees. Before the auction of the car, the lender paid the storage fees and repossessed the car. The lender then proceeded to move the car to a different storage company. The lender sent the borrower a letter stating that the lender now had possession of the car and the borrower could redeem the car by paying the full balance owed, or the lender would sell it. The borrower stopped making payments under the original agreement, so the storage company transferred title of the car to the lender. The lender also provided a repossession affidavit, which allowed the storage company to sell the car. The storage company then sold the car, and the lender sent the borrower a final statement claiming the borrower owed additional money on the car because of the late fees. The borrower proceeded to sue the lender and the storage company, asserting claims for breach of contract, breach of the implied covenant of good faith and fair dealing, fraudulent misrepresentation, slander, conversion, deceptive trade practices, unjust enrichment, civil conspiracy and concert of action claims, aiding and abetting, declaratory relief, and punitive damages. The borrower did not respond to the summary judgment motions, and his unanswered requests for admission were deemed admitted in the action.
In Spicer v. U.S. Bank, No. 2:22-cv-01003-APG-BNW, 2025 WL 2687150, 2025 U.S. Dist. LEXIS 184092 (D. Nev. Sept. 19, 2025) (opinion not yet released for publication), the court granted summary judgment in favor of the lender and storage company on all claims. First, the court held that no reasonable jury could find that the lender breached its contract or breached its implied covenant of good faith and fair dealing with the borrower because the borrower had allowed another security interest on the car. To succeed on a breach of contract claim, the plaintiff must show: (1) formation of a valid contract, (2) performance or excuse of performance by the plaintiff, (3) material breach by the defendant; and (4) damages. Under the financing agreement, the lender could repossess the car if another party obtained a security interest in the car. The borrower triggered this right when he failed to pay storage fees to the original tow yard, resulting in a lien on the vehicle. Next, to succeed on a claim for breach of the implied covenant of good faith and fair dealing, the plaintiff must prove: (1) the existence of a contract between the parties, (2) that defendant breached its duty of good faith and fair dealing by acting in a manner unfaithful to the purpose of the contract; and (3) the plaintiff’s justified expectations under the contract were denied. The court granted summary judgment for the lender on the basis that the lender acted faithfully to the financing agreement when it repossessed the car from the storage company because another party had obtained a security interest in the car. Next, to succeed on a fraudulent misrepresentation claim, the borrower must show: (1) the lender made a false representation with either knowledge or belief that the representation was false or without a sufficient foundation to make the statement, (2) the lender intended to induce the borrower’s reliance; and (3) the borrower suffered damages as a result of that reliance. The borrower’s fraudulent misrepresentation claim failed because he presented no evidence that the lender’s final statement claiming the borrower owed more money was incorrect. Furthermore, the borrower presented no facts supporting his claim that the lender slandered him by charging an incorrect amount. Therefore, the court granted summary judgment to the lender. The lender and the storage company prevailed on the borrower’s conversion claims because the borrower provided no evidence that either party wrongfully possessed the car. The borrower’s deceptive trade practices claim similarly failed because the storage company never obtained a lien on the car, a requirement to bring the claim under Nevada law. Likewise, the borrower failed to provide any evidence that the lender or storage company participated in consumer fraud. Specifically, the borrower alleged no facts that the lender or storage company unlawfully repossessed the car. The lender only repossessed the car after the initial tow yard placed a lien on it, which constituted a default under the applicable agreements.. Additionally, the court recognized that the lender requested the vehicle to be sold at auction only after giving the borrower around eight months to pay the balance he owed on the vehicle. Based on this failure to present facts of unlawful repossession, the court also denied the borrower’s claims of unjust enrichment. Because the borrower presented no evidence of an agreement between the lender and the storage company, the borrower’s civil conspiracy and concert of action claims failed. To establish aiding and abetting, the plaintiff must show that the primary violator breached a duty that injured the plaintiff. Because the court previously found no breach of contract by either the lender or storage company, neither could be liable for aiding and abetting. Therefore, because all the borrower’s claims failed, the court held the borrower could not receive punitive damages or declaratory relief.
By Charlie Cole [email protected]
Edited By Olivia Lewis [email protected]
Edited By Callighan Ard [email protected]