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FURMAN RALEIGH v. CREDIT MANAGEMENT COMPANY (09/19/88)

decided: September 19, 1988.

FURMAN RALEIGH, APPELLANT,
v.
CREDIT MANAGEMENT COMPANY



Appeal from the Judgment Entered December 3, 1987, in the Court of Common Pleas of Allegheny County, Civil, at No. AD84-08724.

COUNSEL

David B. Washington, Pittsburgh, for appellant.

Kevin G. Sasinoski, Pittsburgh, for appellee.

McEwen, Watkins and Hester, JJ.

Author: Watkins

[ 379 Pa. Super. Page 80]

This case involves an appeal from the judgment of the Court of Common Pleas of Allegheny County, Civil Division, entered on December 3, 1987. We affirm.

In this case, the appellant, Furman Raleigh, purchased an automobile by way of an installment sales agreement and obtained financing through the Churchill R & D Federal Credit Union in 1983. He became delinquent in his payments, making his last payment January 31, 1984. No other payments were made on the vehicle. On July 7, 1984, Churchill R & D Credit Union turned the appellant's delinquent account over to the Credit Management Company for collection. On August 9, 1984, the automobile was repossessed and on that same day Notice of Repossession and impending sale of the car was sent to appellant by certified mail. The automobile was sold at public auction on August 24, 1984.

Appellant contends that the automobile was sold prior to the expiration of the 15-day notice provision requirements of the Motor Vehicle Sales Financing Act, 69 Pa.S.A. 623-626.(MVSFA) The issue appellant raises in this appeal is whether, in computing the 15-day holding period required by the MVSFA, the date of mailing is to be excluded.

Section 625(A) of the Motor Vehicle Sales Financing Act states:

"When repossession of a motor vehicle which is the subject of an installment sales contract is effected within the Commonwealth of Pennsylvania otherwise than by legal process. The holder shall retain such repossessed motor vehicle within the county in which it was retaken for a period of 15 days after mailing of notice of repossession of the buyer."

This section makes it clear that the date of mailing is to be excluded when computing the time the holder must retain the automobile prior to sale. Therefore, Credit Management mistakenly sold the automobile prematurely as it was sold on the 15th day after the notice was mailed.

[ 379 Pa. Super. Page 81]

In enacting the MVSFA, the Pennsylvania legislature determined and declared as a matter of legislative finding:

(a) That an exhaustive study by the Joint State Government Commission discloses nefarious, unscrupulous and improper practices in the financing of the sale of motor vehicles in this Commonwealth which are unjustifiably detrimental to the consumer and inimical to the public welfare. Such practices prevail not only among some sellers, but also among some sales finance companies and some banks, which acquire contracts arising out of installment sales of motor vehicles, and which frequently influence the credit policies of sellers.

(c) That consumers, because of these legal technicalities and because of their unequal bargaining position, are at the mercy of unscrupulous persons and are being intolerably exploited in the installment purchase of motor vehicles. Such exploitation is evident in the unfair provisions of the installment sale contract, exorbitant charges for credit, extortionate default, extension, collection, repossession and other charges, unconscionable practices respecting execution of contracts, refinancing of contracts, repayment, refunds, insurance, repossession and redemption.

(d) the practices enumerated, and other equally pernicious, have existed to such an extent that regulation of the installment selling of motor vehicles is necessary to the adequate protection of the public interest. Adequate regulation of installment selling must include control of the functions of selling and financing of motor vehicles, whether exercised by the same of different persons.

Therefore, it is hereby declared to be the policy of the Commonwealth of Pennsylvania to promote the welfare of its inhabitants and to protect its citizens from abuses presently existing in the installment sales of motor vehicles, and to that end exercise the police power of the Commonwealth to bring under supervision of the Commonwealth all persons engaged in the business of extending

[ 379 Pa. Super. Page 82]

    consumer credit in conjunction with the installment sale of motor vehicles; to establish a system of regulation for the purpose of insuring honest and efficient consumer credit service for installment purchases of motor vehicles; and to provide the administrative machinery necessary for the effective enforcement. 69 P.S. ยง 602.

We are convinced that the MVSFA "was not intended to create a comprehensive system of regulation for the motor vehicle sale industry." Whiteman v. Dengan Cheverolet Inc., 217 Pa. Superior Ct. 424, 272 A.2d 244 (1970). "The Act was passed instead to correct the abuses as set forth above in the 'Findings and declarations of policy' section of the Act and those findings and declarations must be given weighty consideration when the Act is being interpreted." Industrial Valley Bank and Trust Co. v. Nash, 349 Pa. Superior Ct. 27, 502 A.2d 1254 (1985).

In this case the appellant is claiming $2,500.00 in damages because the Credit Management Company sold his repossessed vehicle several hours prior to the expiration of the 15 day notice requirement of the MVSFA. However, given the facts of this case, this court finds that it cannot, in equity and good conscience, award damages based on appellant's claims.

The MVSFA was enacted into law to address egregious conduct. After thoroughly reviewing the record, we find that the Credit Management Company acted in a good faith belief that they were complying with the act, that an ambiguity in the language of sections 623(D) and 625 of the MVSFA led the Credit Management Company into mistakenly believing that they were within their rights, that Credit Management's conduct was not of the type the MVSFA was designed to protect against, that the infraction complained of resulted in a "de minimis" violation of the Act as the vehicle was sold only hours before the expiration of the 15th day, that the debtor/appellant disregarded all ...


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