Appeal from Circuit Court, Lane County. Edwin E. Allen, Judge.
Cleveland C. Cory, Clarence R. Wicks, William M. McAllister, and Davies, Biggs, Strayer, Stoel & Boley, Portland, filed the briefs for appellant.
Mervyn H. Loya and Theodore Richter, Eugene, filed an amicus curiae brief on behalf of Lane County Legal Aid Service, Inc., Eugene.
Plaintiffs filed this action at law charging the defendant bank with trespass and conversion of a used automobile which had been repossessed by defendant. Defendant appeals from a judgment entered on a verdict for plaintiffs.
While the defendant alleges various assignments of error relating to the refusal of the trial court to give certain instructions and to grant defendant a directed verdict, the parties agree that the cause presents only one issue: Did the defendant bank's repossession of plaintiffs' auto without notice and without a prior hearing amount to a deprivation of plaintiffs' property without due process in violation of the Due Process Clause of the Fourteenth Amendment to the U.S. Constitution?
On November 14, 1970, plaintiffs purchased an automobile on an installment sale contract providing for monthly payments. The auto dealer subsequently sold the contract to the defendant, United States National Bank of Oregon.
The agreement provided that in the event of default by the purchaser, the bank, without notice to the purchaser, could "enter any place where the property may be found, and take and remove the same and any property found in or attached to" the auto.
The agreement also allowed the bank to "elect any other legal or equitable remedy, including all remedies available under the Uniform Commercial Code" for the recovery of the property.
The plaintiffs failed to make any payments after January, 1971, and in May, 1971, a field representative of the defendant bank advised plaintiffs that the payments must be made or the bank would take the car. Plaintiffs advised the defendant to secure a court order and they would "give the car up peaceably."
On the night of May 19, 1971, the field representative of the bank repossessed the car. No breach of the peace was involved.
The plaintiffs contend that § 9-503 of the Uniform Commercial Code (ORS 79.5030)*fn1 authorizing the creditor to use self-help in taking possession of the collateral in the event of default is unconstitutional as a ...