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GIBBS v. TITELMAN

November 8, 1973

Harry H. and Thelma GIBBS et al.
v.
William A. TITELMAN, Individually and as Director of the Bureau of Motor Vehicles of the Commonwealth of Pennsylvania, et al.


Bechtle, District Judge.


The opinion of the court was delivered by: BECHTLE

On November 2, 1972, the above-named plaintiffs, purporting to act as a class, filed a complaint seeking to have a Pennsylvania state statutory scheme involving the repossession of motor vehicles declared unconstitutional; *fn1" and to have defendant, General Motors Acceptance Corporation ("GMAC"), and all parties purported to be similarly situated, enjoined from continuing to effect extrajudicial nonconsensual repossessions of motor vehicles. The complaint also sought to have the defendant, William A. Titelman, Pennsylvania Director of the Bureau of Motor Vehicles, enjoined from permitting the transfer of titles of motor vehicles repossessed in the above manner.

 The litigation surrounding this action involved many issues, each of which were thoroughly briefed and argued at the several hearings and pretrial conferences had in this case over a period of months. Several memorandum opinions and orders, ruling on pretrial issues, were issued by the Court. Below is a chronological discussion of the pretrial issues and rulings in this case, followed by the Court's findings of facts and conclusions of law.

 I. Temporary Restraining Order

 On November 2, 1972, along with the complaint, the plaintiffs filed a motion for a Temporary Restraining Order ("TRO") *fn2" which sought:

 (1) To immediately restrain defendant Titelman from transferring title of any nonconsensually repossessed motor vehicle in Pennsylvania;

 (2) To immediately restrain defendant Auto-Road, Inc., from selling the automobile of named plaintiff Ella Lemar, which it had earlier repossessed; and,

 (3) To order Auto-Road, Inc., to return plaintiff Lemar's automobile.

 The Court denied the relief sought against defendant Titelman, for the reason that it did not appear from the specific facts sworn by the verified complaint that anything Titelman did caused the applicants the irreparable harm of which they complained. The Court also denied the application to order Ella Lemar's automobile returned to her for the reason that, until the evidence was introduced in an adversary proceeding on the validity of the statutes, it was not at all clear who had a greater right to the possession of the automobile in question. The Court did, however, grant the temporary restraint of the sale of the Lemar automobile by Auto-Road, Inc. On that point, the Court found that the facts sworn to by the plaintiffs showed that immediate and irreparable harm would result to Mrs. Lemar if the sale of her automobile were not temporarily restrained.

 On November 9, 1972, a formal hearing was held to determine whether the TRO entered on November 2 as to the sale of the Lemar automobile should be extended. At the time of that hearing, an agreement was entered into by the owner of Auto-Road, Inc., and counsel for the Lemars. This agreement, involving possession and payments on the automobile, settled the private dispute between the Lemars and Auto-Road, Inc., thereby mooting the issue of extending the TRO. *fn3"

 At the November 9, 1972, hearing, the Court also entertained argument from all interested parties at this point in the proceedings as to:

 
(1) The jurisdictional question of whether or not this is a proper case for convening a three-judge court pursuant to 28 U.S.C. § 2281 and § 2284; and,
 
(2) Whether jurisdiction lies for a single judge to hear this matter pursuant to 28 U.S.C. § 1343(3) and § 1343(4).

 II. Three-Judge Court

 28 U.S.C. § 2281, entitled "Injunction Against Enforcement of State Statute; Three-Judge Court Required," states:

 
"An interlocutory or permanent injunction restraining the enforcement, operation or execution of any State statute by restraining the action of any officer of such State in the enforcement or execution of such statute or of an order made by an administrative board or commission acting under State statutes, shall not be granted by any district court or judge thereof upon the ground of the unconstitutionality of such statute unless the application therefor is heard and determined by a district court of three judges under section 2284 of this title."

 By its terms, § 2281 embraces only those cases in which an interlocutory injunction is sought to prevent the operation of a state statute "by restraining the action" of a state officer "in the enforcement or execution of such statute." Wilentz v. Sovereign Camp, W.O.W., 306 U.S. 573, 580, 59 S. Ct. 709, 713, 83 L. Ed. 994 (1939). Here, it appears on the face of the complaint that the statutes assailed are those prescribing a right of summary repossession. (See paragraphs 5 and 46 of the Complaint.) Although Titelman, a state officer, is named in the complaint, *fn4" it is well settled that a state officer cannot be named perfunctorily or as a nominal defendant in an attempt to attain the necessary official action. Moody v. Flowers, 387 U.S. 97, 101-102, 87 S. Ct. 1544, 18 L. Ed. 2d 643 (1966); Wilentz v. Sovereign Camp, W.O.W., supra, 306 U.S., at pp. 579-580, 59 S. Ct. 709.

 Neither Titelman nor any other state officer is clothed with the authority to enforce these statutes. The alleged deprivation prescribed by the statutes takes place before any action or indeed any knowledge on the part of defendant Titelman, comes into play. Enjoining Titelman would not redress this deprivation.

 The statute under which Titelman acts is 75 P.S. § 208, entitled "Change of ownership by operation of law and judicial sale." The statute provides that, in the case of a transfer of ownership or possession of a motor vehicle, by operation of law (e.g., inheritance, an order in bankruptcy, or repossession, etc.), it becomes the duty of the one in possession of the motor vehicle to surrender the Certificate of Title to the person to whom possession has so passed. The secretary (Titelman), upon surrender of the outstanding Certificate of Title, or upon presentation of satisfactory proof to the secretary of ownership and right of possession to such motor vehicle, then issues to the new possessor a Certificate of Title.

 Nothing in this statute provides for an extrajudicial deprivation of property. Assigning a Certificate of Title does not confer possession or ownership in anyone. *fn5" In fact, "satisfactory proof of ownership and right to possession must exist" before a Certificate of Title can be assigned. We can see no language on the face of this statute (75 P.S. § 208) which would make it constitutionally suspect, and the plaintiffs have not alleged any facts to show that it is unconstitutional as applied. For these reasons, we find the jurisdictional prerequisite of action by a state officer absent and, therefore, must refuse, under 28 U.S.C. § 2281, the request to have a Three-Judge Court empaneled.

 III. State Action

 Plaintiffs also seek to invoke jurisdiction of the District Court under 28 U.S.C. § 1343(3) and § 1343(4). *fn6" Section 1343(3) states:

 
"The District Courts shall have original jurisdiction of any civil action authorized by law to be commenced by any person:
 
"(3) To redress the deprivation, under color of any State law, statute, ordinance, regulation, custom or usage, or any right, privilege or immunity secured by the Constitution of the United States or by any Act of Congress providing for equal rights of citizens or of all persons within the jurisdiction of the United States;"

 The statutory schemes in question, 69 P.S. §§ 623-627 and 12A P.S. § 9-503 and § 9-504, prescribed a right in a seller (also holder or secured creditor) to summarily repossess property which is the subject of a contract (or security agreement) when the buyer is in default under that contract. 69 P.S. §§ 623-627 are specifically limited to repossessions of motor vehicles pursuant to installment sales contracts.

 The sole question for determination of this jurisdictional issue is whether the actions of the defendants in repossessing motor vehicles are performed "under color of any State law, statute ordinance, regulation, custom or usage . . ."

  This exact issue has been litigated recently by a number of Federal and state courts. The majority of them hold that the act of self-help repossession is not performed "under color of any State law." See, Adams v. Southern California First National Bank, 492 F.2d 324, (9th Cir. 1973); McCormick v. First National Bank of Miami, 322 F. Supp. 604 (S.D. Fla. 1971); Oller v. Bank of America, 342 F. Supp. 21 (N.D. Cal. 1972); Greene v. First National Exchange Bank of Virginia, 348 F. Supp. 672 (W.D. Va. 1972); Kirksey v. Theilig, 351 F. Supp. 727 (D. Colo. 1972); Pease v. Havelock National Bank, 351 F. Supp. 118 (D. Neb. 1972); Colvin v. Avco Financial Services, 12 UCC Rep. Serv. 25 (D. Utah 1973); Shirley v. State National Bank of Connecticut (D. Conn. 1973); Turner v. Impala Motors (W.D. Tenn. 1973); Mayhugh v. Bill Allen Chevrolet (W.D. Mo. 1973); Kinch v. Chrysler Credit Corporation, 367 F. Supp. 436 (E.D. Tenn. 1973); Messenger v. Sandy Motors, Inc., 121 N.J. Super. 1, 295 A.2d 402 (1972); Brown v. United States National Bank of Oregon, 265 Ore. 234, 509 P.2d 442 (Or. 1973); Giglio v. Bank of Delaware, Del. Ch., 307 A.2d 816 (1973); Northside Motors of Florida, Inc. v. Brinkley, 282 So. 2d 617 (Sup. Ct. Fla. 1973). Courts taking the opposite view include: Michel v. Rex-Noreco, 12 UCC Rep. Serv. 543 (D. Vt. 1972); Boland v. Essex County Bank and Trust Co., 361 F. Supp. 917 (D. Mass. 1973); James v. Pinnix (S.D. Miss. 1973); Chrysler Credit Corp. v. Dinitz (Kings County, New York, Civil Court 1972).

 The courts that have refused to find sufficient state involvement have done so for various reasons. One ground, determinative of a number of the cases supporting the defendants' view, is that self-help repossessions, such as the ones questioned herein, come from a well-established heritage in the common law, which has precedential value that exists notwithstanding the remedy's statutory codification. See, Adams v. Southern California First National Bank, supra ; Oller v. Bank of America, supra ; Green v. First National Exchange Bank of Virginia, supra ; Kirksey v. Theilig, supra ; Pease v. Havelock National Bank, supra ; Mayhugh v. Bill Allen Chevrolet, supra ; Colvin v. Avco Financial Services, supra.

 That self-help repossession has its ancestry in common law is well settled; what is not well settled, however, is that it ever was a sound historic principle with any precedential value.

 (A) Distraint at Common Law

 Self-help repossession comes from the common law principle of distress or distraint. "A distress is the taking of a personal chattel without legal process from the possession of a wrongdoer into the hands of the party aggrieved, as a pledge for the redress of an injury, the performance of a duty, or the satisfaction of a demand." *fn7"

 Self-help is one of the oldest principles of law. Man's natural impulse, upon being injured by another, is to punish the wrongdoer and compel him to make reparation. Prior to its reaching elementary stages of sophistication, all law was based on the principle of self-redress.

 From the earliest recordation of legal history, there were powerful efforts to check, guide, and ultimately eliminate extrajudicial distraint. In Roman law, the extrajudicial right of seizure by an individual creditor could be properly exercised only in a few well-defined cases. Under Teutonic law, the remedy was strictly regulated. A succession of demands had to be made on the debtor in solemn form by complaint. Three witnesses had to accompany the creditor to the house of the debtor. If there were still a refusal by the debtor, the creditor had to summon him before the court for an injunction against the debtor from disposing of the goods to be distrained. *fn8"

 In England, as a result of the continuing efforts to bring distress into subjection to the law, the remedy had ceased to be an extrajudicial remedy long before the Norman Conquest (1066). At that point in time, its utility had dissipated to a level of merely compelling attendance at courts or enforcing judgments; but in no case could a man distrain on his own. *fn10"

 Self-help distraint, practically extinct due to years of decay through the natural process of legal evolution, was for unique reasons revived during feudalism.

 As a system, feudalism was based on a peculiar tenure of land. *fn11" The existence of a tenant's estate depended upon his performance of certain feudal duties, nonperformance of which could result in a forfeiture of the land. As an alternative to the harshness of this remedy, distraint took on new life: A means of enforcing services due the lord from the tenant. *fn12"

 Not long after the nobility had returned the remedy to an ex parte and extrajudicial proceeding, outcries were heard from the tenants that the remedy was being used as a means of oppression. As a result of the opposition to the remedy, the first attempt at statutory regulation of distress was made: The Statute of Marlboro, in 1267. This codification of the remedy is perhaps one reason for its survival beyond the decay of the system of tenure and the subsequent development of the law of assumpsit.13

 A most accurate description of the history of this self-help remedy, and its utility in our legal system, is given by Professor Street in his treatise on Foundations of Legal Liability:

 
"That normal legal growth must be fatal to the remedy of distress is apparent. It is not only extrajudicial; it is strictly anti-social and anti-legal. It is opposed to fundamental legal conceptions. It can never be tolerated that a man should at the same time be both judge and executive officer in his own behalf. But this is really what distress implies, and in this we see the reason why so much counter-balancing machinery has been built up around the institution wherever it has survived. The first articulate voice of the law is against it. If a system of law fully adapted to the capacity and purpose of man could come into existence without regard to antecedent conditions, distress would certainly have no place in it. Legal evolution tends to bring all procedure into the category of legal process, and thus to eliminate self-help altogether. We, therefore, see early law gradually and surely disentangling itself from the meshes of this primitive institution." Street, at p. 285.

 It is most puzzling, therefore, that extrajudicial distraint, with or without the aid of a state officer, has been accepted by many jurisdictions in modern times. *fn14" Certainly, our judicial system is sophisticated enough to redress the injuries which once gave rise to the need for self-help, notwithstanding the constitutional proscription against a deprivation of property without due process.

 Consequently, this Court does not agree with the courts that have found that modern-day self-help is a historically sound principle of the common law. *fn15" ". . . The fact that a procedure would pass muster under a feudal regime does not mean it gives necessary protection to all property in its modern forms." Sniadach v. Family Finance Corporation of Bay View, 395 U.S. 337, 89 S. Ct. 1820, 23 L. Ed. 2d 349 (1969). The peculiarly feudal remedy of distraint, criticized throughout the history of English common ...


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