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11/01/88 Micro Switch Employees' v. Troy Collier

November 1, 1988

MICRO SWITCH EMPLOYEES' CREDIT UNION, PLAINTIFF-APPELLEE

v.

TROY COLLIER, DEFENDANT-APPELLANT



APPELLATE COURT OF ILLINOIS, SECOND DISTRICT

530 N.E.2d 595, 175 Ill. App. 3d 828, 125 Ill. Dec. 437 1988.IL.1586

Appeal from the Circuit Court of Stephenson County; the Hon. Barry R. Anderson, Judge, presiding.

APPELLATE Judges:

JUSTICE DUNN delivered the opinion of the court. REINHARD and INGLIS, JJ., concur.

DECISION OF THE COURT DELIVERED BY THE HONORABLE JUDGE DUNN

In 1985, the plaintiff, Micro Switch Employees' Credit Union, loaned the defendant, Troy Collier, $7,300 to purchase a car from a car dealer in Wisconsin. When defendant fell in arrears by over $800 in 1987, plaintiff repossessed defendant's car and filed suit for certificate of title and judgment on the amount owed on the loan. Defendant filed a counterclaim for wrongful repossession. Defendant appeals from an order of the circuit court of Stephenson County that granted judgment to the plaintiff for $7,848.32 and ordered the plaintiff to sell the car, with the proceeds to apply to the judgment.

On appeal, defendant contends the trial Judge erred in holding the Motor Vehicle Retail Installment Sales Act (Ill. Rev. Stat. 1985, ch. 121 1/2, par. 561 et seq.) inapplicable to the transaction. Also, the defendant contends that plaintiff waived its right to repossess defendant's car before giving notice when it accepted late payments. For the reasons set forth below, we affirm.

Under the loan agreement, defendant was required to make weekly payments of $44, maintain insurance on the car, and put the car up as collateral. The agreement stated that defendant would be in default if he failed to make a minimum payment when due or if he failed to maintain car insurance. Further, the agreement provided that plaintiff could repossess the collateral upon default without judicial process or giving notice, and that plaintiff could delay enforcing its rights without losing them.

At first, defendant's loan payments were deducted from his salary from Micro Switch. However, in April 1985, defendant was laid off, and at the time of repossession in February 1987, defendant was over $800 in arrears. Defendant's loan officer, Jo Ellen Turner, testified that she worked with the defendant to bring his payments up to date and told defendant several times that his car would be repossessed if he did not make up his missed payments.

When plaintiff repossessed defendant's car in February 1987, defendant was sent two forms: "Notice of Intent to the Debtor" and "Affidavit of Defense to the Creditor" as required by State of Illinois, Rules and Regulations for repossession of vehicles by lienholders and creditors (10 Ill. Reg. 4245 (adopted Feb. 26, 1986)). The notice informed defendant that plaintiff intended to apply to the Secretary of State for a certificate of title and advised defendant that if he returned the affidavit of defense form, plaintiff would be stopped from getting a certificate of title until it obtained a court order. Defendant sent back the affidavit of defense, and plaintiff filed this suit. The trial Judge found for plaintiff on the amount owed on the loan, $4,890.50, plus attorney fees, and granted plaintiff certificate of title, ordering plaintiff to sell the car.

On appeal, defendant contends that his loan is covered by the Motor Vehicle Retail Installment Sales Act (the Act) (Ill. Rev. Stat. 1985, ch. 121 1/2, par. 561 et seq.). Under the Act, defendant, having paid more than 30% of the loan, would have been entitled to written notice of his right to cure default. The Act, however, does not apply to this transaction. The Act covers purchasers of automobiles who buy from dealers under a retail installment transaction. The Act defines a retail installment transaction as follows:

"'Retail installment transaction' means a credit sale of a motor vehicle by a retail seller to a retail buyer for a deferred payment price payable in one or more installments." Ill. Rev. Stat. 1985, ch. 121 1/2, par. 562.4.

Retail buyer and retail seller are defined as follows:

"'Retail buyer' or 'buyer' means a person who buys a motor vehicle from a retail seller, primarily for personal, family, household or agricultural purposes in a retail installment transaction . . ...


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