The debtor entered into a transaction financed by the bank to purchase a vehicle. Later, the debtor defaulted on her payments, and the bank hired a repossession company, which then contracted another repossession company to repossess the car. While the debtor was waiting for her food in a restaurant parking lot, an employee of the repossession company lifted her vehicle with its tow truck. The debtor protested to the employee, and eventually, the employee lowered the car; however, the tow truck blocked the debtor’s exit for around thirty minutes. The debtor then sued the bank and both repossession companies, claiming breach of the peace, conversion, trespass to chattel, and violation of the Fair Debt Collection Practices Act (FDCPA). The bank and both repossession companies moved to dismiss the debtor’s claims.
In Hansen v. Santander Bank, N.A., 689 F. Supp. 3d 679 (D. Minn. 2023), the court granted in part and denied in part the bank and repossession companies’ motion to dismiss. First, the court held that numerous district courts in Minnesota had already established that repossession companies are debt collectors under the FDCPA, and collection efforts that breached the peace voided a debt collector’s present right of possession. Second, the court denied the motion to dismiss the debtor’s FDCPA claim because it found that a fact finder could reasonably find that the repossession company’s act of lifting the debtor’s vehicle could constitute a breach of the peace. Third, the court dismissed the debtor’s conversion claim because Minnesota law required the deprivation of property to be for a “sufficiently indefinite length of time,” and the court found that the thirty minutes the debtor was blocked from exiting the parking lot was not an indefinite length of time. Fourth, the court dismissed the trespass to chattels claim with prejudice because the debtor had removed her claim against the bank and the middle-man repossession company. Finally, the court rejected the claim for punitive damages against the bank and the middle-man repossession company because there were no allegations that either of those entities directed the repossession company’s actions. However, the court denied the motion to dismiss for punitive damages against the repossession company because the debtor adequately alleged that the act of lifting her car while she was inside of it suggested a “deliberate disregard for the [debtor’s] safety.”
By Cole Palmer [email protected]
Edited By Hayden Mariott [email protected]
Edited By Ashley Boyce [email protected]