Sperro LLC d/b/a Sperro Towing and Recovery, Fenner & Associates LLC, Brian Fenner, and AMI Asset Management, Inc. and Indiana Bureau of Motor Vehicles v. Ford Motor Credit Company LLC

64 N.E.3d 235, 2016 Ind. App. LEXIS 416, 2016 WL 6804599
Indiana Court of Appeals·Decided November 17, 2016·No. 49A02-1601-PL-187·Published·Cited by 14 cases

Opinion

CRONE, Judge.

Case Summary

[1] Sperro LLC d/b/a Sperro Towing and Recovery (“Sperro”) is in the business of transporting and storing collateral. Sperro towed and stored certain vehicles that had been financed by Ford Motor Credit Company LLC (“FMCC”). Sperro sought to assert possessory mechanic’s liens on the vehicles pursuant to Indiana Code Section 9-22-6-2 and sold the vehicles. FMCC filed a complaint against Sperro, Fenner & Associates LLC, and Brian Fenner (collectively “Appellants”), and AMI Asset Management, Inc. (“AMI”), 1 for civil conversion, replevin, tor-tious interference with a contractual relationship, and conspiracy to commit fraud. FMCC also filed a petition for a preliminary injunction. Following a hearing, the trial court issued a preliminary injunction granting FMCC prejudgment possession of specific vehicles in Sperro’s and AMI’s possession, ordering Appellants to turn over to FMCC any known or not yet identified FMCC-financed vehicles that may be in Appellants’ possession, and enjoining Appellants from taking or maintaining possession of any vehicle on which FMCC is the lienholder.

[2] Appellants now bring this interlocutory appeal of the trial court’s entry of preliminary injunction. Appellants challenge the trial court’s conclusions that they did not comply with Indiana Code Section 9-22-6-2 and that they intentionally induced the vehicles’ purchasers to breach their retail installment contracts with FMCC or proceeded with reckless disre *239 gard of their contractual relationship. We conclude that the trial court’s conclusions are not clearly erroneous, and therefore we affirm.

Facts and Procedural History

[3] The following facts are undisputed. 2 Brian Fenner is the sole owner and employee of Sperro, an Indiana limited liability company established in February 2015, which is in the business of transporting and storing collateral. Sperro’s principal office address, as provided in its articles of organization, is P.O. Box 163 in Camby, Indiana, 46113. The 46113 zip code covers parts of Marion, Morgan, and Hendricks Counties. Fenner testified that P.O. Box 163 is located in Hendricks County. However, Sperro transports vehicles to and stores them at 2534 Bluff Road and 2334 South California Street in Indianapolis, Marion County (collectively “the Storage Yards”). Also, Sperro advertises that its hen auction sales are held at the Bluff Road property. Fenner & Associates LLC is an Indiana limited liability company with its articles of incorporation signed by Fenner, and its principal office address is the Bluff Road address.

[4] Fenner was a former employee of AMI, a Wisconsin corporation registered to do business in Indiana. Dennis Birkley is the sole shareholder of AML Fenner and Birkley both worked as repossession/recovery agents and have known each other for over twenty years. Birkley was Fenner’s mentor at one time.

[5] FMCC financed some of the vehicles that Sperro transported to and stored in the Storage Yards. Seven of these vehicles (“the Vehicles”) are the subject of this lawsuit. The Vehicles’ purchasers (“the Borrowers”) financed their vehicles through loans from FMCC pursuant to retail installment contracts (“Installment Contracts”). The Borrowers have contractually defaulted on their payments due to FMCC under the Installment Contracts. The Installment Contracts granted to FMCC a continuing security interest in the Vehicles, and FMCC perfected its security interest in each of the Vehicles by placing its liens on the certificates of title. The Installment Contracts required the Borrowers to keep the Vehicles free from the claims of others; not expose the Vehicles to misuse, seizure, confiscation, or involuntary transfer; and not sell, rent, lease, or transfer any interest in the Vehicles or the Installment Contracts without FMCC’s written permission. Plaintiffs Ex. 28(d). Upon a Borrower’s default under the Installment Contract, FMCC was entitled to demand the full amount owed and take possession of the Vehicle. However, FMCC was not contacted by the Borrowers or Sperro prior to transportation of the Vehicles to the Storage Yards and did not consent to Sperro taking possession of and transporting the Vehicles hundreds of miles from their surrender points. Sperro transported the Vehicles from New Mexico, California, Louisiana, and Arizona to its Storage Yards in Indianapolis.

[6] Fenner operated Sperro according to a certain business plan that the trial court referred to as “the Sperro Plan.” Appellants’ App. at 27. Under the Sperro Plan, Sperro established contacts with numerous consumer bankruptcy attorneys throughout the United States, who would notify Sperro when a prospective bankruptcy client had a financed vehicle that he or she could no longer afford to make the payments on. Although such vehicles *240 would normally be voluntarily surrendered to the secured creditor, Sperro would offer to pay the client’s bankruptcy legal fees in exchange for the client’s agreement to have the vehicle towed to Indiana and stored pursuant to a Transporting and Storage Authorization Agreement (“TSAA”). The TSAA authorized Sperro to make the following charges: $1.85 per mile to transport a vehicle to the Bluff Road property; a $75 loading fee and a $75 unloading fee; a $45 per day outdoor storage fee; a $250 preventive maintenance care package; up to an $800 fee if a lien sale proceeding commenced; and a $175 administrative fee if the owner defaulted under the TSAA, Plaintiffs Ex. 36. The TSAA also provided that the storage fees began to accrue on the date that the bankruptcy client entered into the agreement and were due in arrears on the first day of each month. Id, Upon declaring a default under the TSAA, Sperro would issue a notification of lien to the owner of the vehicle and the lienholder, stating that if the demanded amount was not paid within fifteen days, the vehicle would be considered abandoned and any lien or interest in the vehicle would be forfeited. By signing the TSAA, the client acknowledged that Sperro had a security interest in the vehicle and a “right to claim a lien to recover transport/storage and other charges incurred.” Id, The Borrowers’ execution of the TSAAs and surrender of the Vehicles to Sperro constituted a default on their promises in the Installment Contracts to keep the Vehicles free from the claims of any others, not to expose the Vehicles to seizure, and not to transfer any interest in the Vehicles without FMCC’s written permission.

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Sperro LLC d/b/a Sperro Towing and Recovery, Fenner & Associates LLC, Brian Fenner, and AMI Asset Management, Inc. and Indiana Bureau of Motor Vehicles v. Ford Motor Credit Company LLC, 64 N.E.3d 235, 2016 Ind. App. LEXIS 416, 2016 WL 6804599 (Ind. Ct. App. 2016).

64 N.E.3d 235 (Sperro LLC d/b/a Sperro Towing and Recovery, Fenner & Associates LLC, Brian Fenner, and AMI Asset Management, Inc. and Indiana Bureau of Motor Vehicles v. Ford Motor Credit Company LLC) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.

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