Ark. Code Ann. § 4-9-610 (2020)

Case Notes

In General.

The doctrine of commercial reasonableness applies to possession as well as disposition. Marks v. Powell, 162 B.R. 820 (E.D. Ark. 1993) (decision under prior law).

Attachment Sales.

Rights under this section, of seller of tractor who perfected security interest for the unpaid purchase price, were not destroyed by attachment sale of the tractor effected by bank to satisfy judgment on unsecured debt owed bank by buyer of tractor, since this section relates only to the discharge of subordinate liens when property is sold under this subtitle. Citizens Bank v. Perrin & Sons, 253 Ark. 639, 488 S.W.2d 14 (1972) (decision under prior law).

Attorney's Fees.

A secured creditor is entitled to allowance of attorney fees as provided in an installment sales contract after the debtor has filed a bankruptcy petition. In re Morris, 602 F.2d 826 (8th Cir. 1979) (decision under prior law).

A secured creditor is entitled to recover reasonable attorney's fees for services rendered by an attorney in obtaining possession of collateral as a cost of reducing it to possession under the pre-2001 version of this chapter where the attorney's fees allowed to a secured creditor were not those of collecting the debt, or of conducting the sale of the collateral, the statutory provision requiring the agreement of the debtor had no application. Svestka v. First Nat'l Bank, 269 Ark. 237, 602 S.W.2d 604 (1980) (decision under prior law).

Provision under the pre-2001 version of this chapter allowing, to the extent provided for in the agreement and not prohibited by law, the reasonable attorney's fees and legal expenses incurred by a secured party in obtaining collateral subsequent to default by a purchaser, is limited by the requirement of § 4-56-101 that the underlying instrument be a promissory note. In cases not involving promissory notes, a secured party may not collect attorney's fees incurred for services rendered by an attorney in obtaining possession of collateral after default by the purchaser, even though the parties may have contracted for such fees. White v. Associates Com. Corp., 20 Ark. App. 140, 725 S.W.2d 7 (1987) (decision under prior law).

Care of Collateral.

The actions of the creditor bank with regard to the disposition of the collateral was shown to be recklessly, if not willfully, catastrophic under the pre-2001 version of this chapter; the bank destroyed valuable portions of the property, ignored advice on preserving the collateral, and destroyed equipment by attempting to dismantle it without any knowledge or care with regard to that equipment. Marks v. Powell, 162 B.R. 820 (E.D. Ark. 1993) (decision under prior law).

Commercially Reasonable Sale.

Proof that a better price could have been obtained by a sale at a different time and in a different method was insufficient to establish commercial unreasonableness under the pre-2001 version of this chapter. Goodin v. Farmers Tractor & Equip. Co., 249 Ark. 30, 458 S.W.2d 419 (1970); Jones v. Union Motor Co., 29 Ark. App. 166, 779 S.W.2d 537 (1989) (decisions under prior law).

Notes were extinguished by their acquisition by the maker where pledgor of notes was in default at the time the maker indirectly acquired them from the pledgees and the pledgor was given proper notice of the sale and the sales were conducted in a commercially permissible and reasonable manner. Lane v. Midwest Bancshares Corp., 337 F. Supp. 1200 (E.D. Ark. 1972) (decision under prior law).

When a debtor proceeds against a secured party, challenging the commercial reasonableness of a default sale, the debtor has the burden of proving the secured party's failure to proceed under the pre-2001 version of this chapter. Becknell v. Quinn, 592 F. Supp. 102 (E.D. Ark. 1983), aff'd sub nom. Becknell v. First Nat'l Bank, 740 F.2d 609 (8th Cir. 1984) (decision under prior law).

Whether a sale was conducted in a commercially reasonable manner under the pre-2001 version of this chapter is a fact question to be determined from the facts of the particular case under consideration. Becknell v. Quinn, 592 F. Supp. 102 (E.D. Ark. 1983), aff'd sub nom. Becknell v. First Nat'l Bank, 740 F.2d 609 (8th Cir. 1984); Farmers & Merchants Bank v. Barnes, 17 Ark. App. 139, 705 S.W.2d 450 (1986); Womack v. First State Bank, 21 Ark. App. 33, 728 S.W.2d 194 (1987); Beard v. Ford Motor Credit Co., 41 Ark. App. 174, 850 S.W.2d 23 (1993) (decisions under prior law).

Even if it could be said that the sales of limited partnership units were not commercially reasonable under the pre-2001 version of this chapter, debtor, after default, either waived the requirements of a commercially reasonable sale, or agreed that the sales proposed by each of the banks and the manner of making them were commercially reasonable, where neither the debtor nor his attorneys, all experts, suggested any procedure other than that proposed by each of the banks, and no action was taken by either debtor or his attorneys in his behalf to question either of the sales until some months after the sale. Becknell v. Quinn, 592 F. Supp. 102 (E.D. Ark. 1983), aff'd sub nom. Becknell v. First Nat'l Bank, 740 F.2d 609 (8th Cir. 1984) (decision under prior law).

Debtor failed to establish that the sales were not held in a commercially reasonable manner under the pre-2001 version of this chapter. Becknell v. Quinn, 592 F. Supp. 102 (E.D. Ark. 1983), aff'd sub nom. Becknell v. First Nat'l Bank, 740 F.2d 609 (8th Cir. 1984); Beard v. Ford Motor Credit Co., 41 Ark. App. 174, 850 S.W.2d 23 (1993) (decisions under prior law).

Where the uncontroverted testimony was that upon repossession the automobile dealer immediately began trying to sell the automobile to wholesalers and individual purchasers, and that the dealer apparently did everything it could to sell the vehicle as quickly as possible, including making extensive repairs on the badly damaged automobile, the delay in reselling the car was commercially reasonable under the pre-2001 version of this chapter. Brown v. Ford, 280 Ark. 261, 658 S.W.2d 355 (1983) (decision under prior law).

When the debtor defends upon the ground that the secured creditor did not proceed in accordance with the provisions of the Uniform Commercial Code in disposing of repossessed collateral under the pre-2001 version of this chapter, the creditor has the burden of proving that he proceeded in a commercially reasonable manner; whether a sale of collateral was conducted in a commercially reasonable manner is essentially a factual question. Henry v. Trickey, 9 Ark. App. 47, 653 S.W.2d 138 (1983) (decision under prior law).

The purchase of the repossessed mobile home by the secured party at its own private sale was improper, and the sale failed to meet the standard of commercial reasonableness in former § 4-9-504(3), where, although the secured party notified the debtors that a public sale of the repossessed property would be held, the sale was held at the secured party's offices, with only the secured party's employees present. Benton v. General Mobile Homes, Inc., 13 Ark. App. 8, 678 S.W.2d 774 (1984) (decision under prior law).

A creditor who repossesses chattels and resells them in a manner inconsistent with the provisions of the Uniform Commercial Code bears the responsibility to prove that the sale was commercially reasonable under the pre-2001 version of this chapter before he is entitled to a deficiency judgment. Farmers & Merchants Bank v. Barnes, 17 Ark. App. 139, 705 S.W.2d 450 (1986) (decision under prior law).

If a secured creditor sells collateral in a commercially unreasonable manner under the pre-2001 version of this chapter, a presumption arises that the value of the collateral is equal to the outstanding debt; the burden then shifts to the creditor to prove that the reasonable value of the collateral was less than the debt. Farmers & Merchants Bank v. Barnes, 17 Ark. App. 139, 705 S.W.2d 450 (1986) (decision under prior law).

The creditor did not proceed in a commercially reasonable manner under the pre-2001 version of this chapter where it retained the equipment for 19 months, sold it for $9,500 when two years before it had a value of $35,000, neglected to repair the excavator although repairs would have increased the sale price, and, most significantly, permitted its agent to use the equipment extensively, thus diminishing its value. Farmers & Merchants Bank v. Barnes, 17 Ark. App. 139, 705 S.W.2d 450 (1986) (decision under prior law).

Seller acted in a commercially reasonable manner under the pre-2001 version of this chapter. White v. Associates Com. Corp., 20 Ark. App. 140, 725 S.W.2d 7 (1987) (decision under prior law).

Sale was not conducted in a commercially reasonable manner under the pre-2001 version of this chapter. Womack v. First State Bank, 21 Ark. App. 33, 728 S.W.2d 194 (1987); Holiman v. Hagan's Motors, Inc., 32 Ark. App. 62, 796 S.W.2d 356 (1990) (decisions under prior law).

The burden is on the secured party, as the plaintiff to establish the deficiency, and if the secured party's handling of the disposition of the collateral is attacked, it has the burden of proving that every aspect of that disposition was commercially reasonable under the pre-2001 version of this chapter, including the value of a trade-in. Holiman v. Hagan's Motors, Inc., 32 Ark. App. 62, 796 S.W.2d 356 (1990) (decision under prior law).

Where creditor sent written notice that a sale of the collateral would take place at the offices of the creditor, but the sale actually took place at a dealer's-only auction at a later date, the sale was not commercially reasonable under the pre-2001 version of this chapter. AM Credit Corp. v. Riley, 35 Ark. App. 168, 815 S.W.2d 392 (1991) (decisions under prior law).

—In General.

Commercial reasonableness under the pre-2001 version of this chapter is a flexible concept, based upon a consideration of all relevant factors presented in each individual case; factors regarding disposition include the specific nature of the collateral, the nature of the special market, the length of time which elapsed between repossession and resale, and normal commercial practices in the trade. Marks v. Powell, 162 B.R. 820 (E.D. Ark. 1993) (decision under prior law).

A sale of collateral was not conducted in a commercially reasonable manner under the pre-2001 version of this chapter where (1) the price obtained for the collateral was inadequate, (2) an assistant vice-president for the defendant bank testified at trial that the collateral was worth $ 22,500 but stated in an earlier affidavit that the collateral had sufficient value to cover a $ 40,000 debt, and (3) the disposition of the collateral was actually a settlement of a lawsuit between the defendant bank and the purchaser of the collateral, rather than an actual sale. Eagle Bank & Trust Co. v. Dixon, 70 Ark. App. 146, 15 S.W.3d 695 (2000) (decision under prior law).

—Burden of Proof.

Once the debtor challenges the reasonableness of the disposition, the burden is upon the secured party to prove that the disposition was commercially reasonable. Marks v. Powell, 162 B.R. 820 (E.D. Ark. 1993) (decision under prior law).

The debtor may be required to prove a lack of commercial reasonableness when the debtor initiates an action for damages resulting from an unreasonable sale. City Nat'l Bank v. Unique Structures, 49 F.3d 1330 (8th Cir. 1995) (decision under prior law).

Where the debtor defended upon the ground that the secured creditor did not proceed to dispose of the collateral securing the indebtedness in accordance with the provisions of the UCC, the creditor then had the burden of proving that he proceeded in a commercially reasonable manner. Mercantile Bank v. B & H Associated, Inc., 330 Ark. 315, 954 S.W.2d 226 (1997) (decision under prior law).

Whether a sale of collateral was conducted in a commercially reasonable manner under this section is essentially a factual question; however, summary judgment granted where plaintiff established a prima facie case that the sale was conducted in a commercially reasonable manner and that defendant failed to “meet proof with proof” in response. Prince v. R & T Motors, Inc., 59 Ark. App. 16, 953 S.W.2d 62 (1997) (decision under prior law).

After debtor's car was repossessed and sold at auction, creditor was not entitled to a deficiency judgment against debtor where creditor failed to show the car's value, the car's condition, or that the manner of sale was reasonable. Greenlee v. Mazda Am. Credit, 92 Ark. App. 400, 214 S.W.3d 290 (2005).

Costs of Collection.

The commercially reasonable and proper costs incurred by a secured creditor in reducing the collateral to possession and holding it and preparing it for sale were proper deductions from the proceeds of sale in arriving at the credit to be given on the debt evidenced by the note; the agreement of the accommodation maker, was not required. Svestka v. First Nat'l Bank, 269 Ark. 237, 602 S.W.2d 604 (1980) (decision under prior law).

The allowance to a secured party of the expenses of preparing for sale personalty which is held as collateral, after default of the debtor, including the costs of repairs reasonably necessary, is not error; accordingly, where a secured bank purchased insurance coverage on an airplane which was held as collateral, pending the sale of the plane, the cost of such insurance was an allowable expense and was commercially reasonable as affording protection, both to the bank and to the accommodation party. Svestka v. First Nat'l Bank, 269 Ark. 237, 602 S.W.2d 604 (1980) (decision under prior law).

Recovery of any commercially reasonable cost in preparing a repossessed automobile for resale would be allowed under this section; accordingly, where the testimony given by the automobile dealer showed that there was extensive physical damage done to the vehicle, and that the carpet, tires, belts, and locks had to be replaced along with numerous other repairs and maintenance, the trial court did not err in awarding the full amount of repair and maintenance expense to the dealer. Brown v. Ford, 280 Ark. 261, 658 S.W.2d 355 (1983) (decision under prior law).

The difference between what the secured party gave on resale of the automobile as a trade-in allowance and what the secured party received as a wholesale price upon the resale of the collateral automobile was an integral part of the bargain and resale of the collateral, and was an allowable expense of the resale under the pre-2001 version of this chapter. Thrower v. Union Lincoln-Mercury, Inc., 282 Ark. 585, 670 S.W.2d 430 (1984) (decision under prior law).

Damages.

In permitting a secured party after default to sell or lease the collateral in any commercially reasonable manner, this section does not limit a secured party's damages to the legal rate of interest. Affiliated Food Stores, Inc. v. Bank of N.E. Ark., 259 Ark. 690, 536 S.W.2d 693 (1976) (decision under prior law).

Deficiency Judgments.

In action to recover deficiency judgment, prerequisite to recovery is that the secured party has the burden of proving either the actual value of the collateral at the time of its sale after repossession, or proving that reasonable notice was sent although receipt need not be proven. Leasing Assocs. v. Slaughter & Son, 450 F.2d 174 (8th Cir. 1971) (decision under prior law).

Where, in action against buyers of bulldozer by seller for deficiency owed after repossession and sale by seller, buyers defended action on grounds sale after repossession was not conducted properly in accord with this section and former § 4-1-203 (now § 4-1-304), seller had the burden of proving the amount of deficiency it was entitled to recover and that the sale was made in good faith and in a commercially reasonable manner. Farmers Equip. Co. v. Miller, 252 Ark. 1092, 482 S.W.2d 805 (1972) (decision under prior law).

Bank which sold repossessed cars at auction was not barred from seeking a deficiency judgment against a motor company, where the motor company was in default under a financing and security agreement where the automobiles were repossessed peacefully, and where the collateral was sold pursuant to an after default agreement. Teeter Motor Co. v. First Nat'l Bank, 260 Ark. 764, 543 S.W.2d 938 (1976) (decision under prior law).

When a creditor repossesses chattels and resells them in a manner not consistent with the pre-2001 version of this chapter, it is his responsibility to prove the sale was commercially reasonable before he is entitled to a deficiency judgment. Rhodes v. Oaklawn Bank, 279 Ark. 51, 648 S.W.2d 470 (1983) (decision under prior law).

If a secured creditor sells the repossessed collateral in a commercially unreasonable manner, a presumption arises under the pre-2001 version of this chapter that the value of the collateral is equal to the outstanding debt; however, the secured party can still recover a deficiency upon proving that the reasonable value of the collateral was less than the debt. Henry v. Trickey, 9 Ark. App. 47, 653 S.W.2d 138 (1983) (decision under prior law).

Once the trial court properly determined the sale of a repossessed combine by a secured creditor was not commercially reasonable under the pre-2001 version of this chapter, the legal presumption arose that the combine was worth the amount of the debt; consequently, the creditor was entitled to a deficiency judgment only if he proved the reasonable value of the combine was less than such amount. Thus, where the creditor offered no evidence as to the combine's reasonable value, he was not entitled to a deficiency judgment. Henry v. Trickey, 9 Ark. App. 47, 653 S.W.2d 138 (1983) (decision under prior law).

The creditor's right to deficiency is established by former § 4-9-504(2) and the burden is upon the secured party as the plaintiff to establish the amount to which it is entitled. When the secured party's handling of the disposition of repossessed property is attacked for want of commercial reasonableness, it then has the burden of proving it complied with the provisions of former §§ 4-9-501 — 4-9-507; when the sale is conducted according to the requirements of those sections, the amount received is evidence of the collateral's true value in such an action. Thrower v. Union Lincoln-Mercury, Inc., 282 Ark. 585, 670 S.W.2d 430 (1984) (decision under prior law).

Evidence supported trial court's finding under the pre-2001 version of this chapter of commercial reasonableness of a delay between default of a lease and disposition of collateral equipment. Meachum v. Worthen Bank & Trust Co., 13 Ark. App. 229, 682 S.W.2d 763, cert. denied, 474 U.S. 844, 106 S. Ct. 132, 88 L. Ed. 2d 108 (1985) (decision under prior law).

The failure of the bank, as a secured party, to give proper notice to the debtor of the time and place of the sale of repossessed collateral, as required by former § 4-9-504(3), absolutely barred the bank's right to a deficiency judgment. First State Bank v. Hallett, 291 Ark. 37, 722 S.W.2d 555 (1987) (decision under prior law).

A secured creditor who has not complied with Commerical Code may still obtain a deficiency judgment if he can overcome the presumption created by his violation that the collateral was worth at least the amount of the debt, thus, under the pre-2001 version of this chapter the creditor has the burden of proving the amount that should reasonably have been obtained through a sale conducted according to law. Cheshire v. Walt Bennett Ford, Inc., 31 Ark. App. 90, 788 S.W.2d 490 (1990). See also City Nat'l Bank v. Unique Structures, 49 F.3d 1330 (8th Cir. 1995) (decisions under prior law).

The failure of the secured party to give written notice under former § 4-9-504(4) or otherwise to establish the commercial reasonableness of the sale by written agreement with the debtor will bar the secured party from any right to a deficiency. Walker v. Grant County Sav. & Loan Ass'n, 304 Ark. 571, 803 S.W.2d 913 (1991) (decision under prior law).

Where a statement in writing signed by the debtors did not exist, waiver of notice requirements could be established by secured party, and the debtors were not estopped to raise failure to give adequate notice as a bar to the deficiency judgment. Walker v. Grant County Sav. & Loan Ass'n, 304 Ark. 571, 803 S.W.2d 913 (1991) (decision under prior law).

Where the sale of collateral was not commercially reasonable pursuant to the requirements of former § 4-9-504(3), the creditor's claim for a deficiency judgment was barred. AM Credit Corp. v. Riley, 35 Ark. App. 168, 815 S.W.2d 392 (1991) (decision under prior law).

If the secured party does not carry its burden of proof on the “commercially reasonable” issue, the secured party is prohibited under the pre-2001 version of this chapter from recovering a deficiency judgment; the secured party may, however, recover a deficiency, even though the sale was unreasonable, if it proves that the reasonable value of the collateral was less than the debt. Marks v. Powell, 162 B.R. 820 (E.D. Ark. 1993) (decision under prior law).

Delay in disposing of the collateral, use of the collateral, or abuse of the collateral will affect the secured party's right to obtain a deficiency judgment under the pre-2001 version of this chapter. Marks v. Powell, 162 B.R. 820 (E.D. Ark. 1993) (decision under prior law).

Prior to 1987, the Arkansas courts presumed that a creditor who failed to dispose of collateral in a commercially reasonable manner was not entitled to a deficiency judgment, but allowed the creditor to rebut this presumption with evidence that a true deficiency existed; in 1987, Arkansas adopted the “absolute bar rule,” under which a creditor who failed to dispose of collateral in a commercially reasonable manner was barred from obtaining a deficiency judgment under the pre-2001 version of this chapter, and now the absolute bar rule applies generally to collateral sales in violation of the Uniform Commercial Code. City Nat'l Bank v. Unique Structures, 49 F.3d 1330 (8th Cir. 1995) (decision under prior law).

If the disposition of collateral is not conducted in a commercially reasonable manner under the pre-2001 version of this chapter, the creditor is entitled to a deficiency judgment. City Nat'l Bank v. Unique Structures, 49 F.3d 1330 (8th Cir. 1995) (decision under prior law).

After a default, a secured party has a right to repossess and dispose of its collateral, and the disposition may be made at public or private sale; if former § 4-9-504 is not complied with, the creditor is not entitled to a deficiency judgment unless the secured party proves that the reasonable value of the collateral was less than the debt. Nat'l Bank of Commerce v. McMullan, 196 B.R. 818 (Bankr. W.D. Ark. 1996), aff'd, 162 F.3d 1164 (8th Cir.), cert. denied, McMullan v. National Bank of Commerce, 525 U.S. 1019, 119 S. Ct. 546, 142 L. Ed. 2d 454 (1998) (decision under prior law).

Disposition of Collateral.

Disposition of the collateral did not satisfy the requirement of former § 4-9-504(3). First Nat'l Bank v. Hess, 23 Ark. App. 129, 743 S.W.2d 825 (1988) (decision under prior law).

This section requires that every aspect of the disposition be commercially reasonable. Marks v. Powell, 162 B.R. 820 (E.D. Ark. 1993) (decision under prior law).

When the secured property is sold to a third party, the property has been “disposed of” pursuant to former § 4-9-504(1), and the original debtor cannot be held liable for any subsequent costs. Bill Fitts Auto Sales, Inc. v. Daniels, 325 Ark. 51, 922 S.W.2d 718 (1996) (decision under prior law).

Trial court erred in dismissing a creditor's action against a debtor to recover the balance on an installment contract for the purchase of an automobile where it was a towing company's duty, as the holder of a first-priority possessory lien on the wrecked automobile, to notify the debtor of its intent to foreclose on the lien by selling the automobile. The creditor never possessed or disposed of the collateral and was therefore not required to give notice before a disposition was made. Primus Fin. Servs. v. Seitz, 102 Ark. App. 146, 283 S.W.3d 235 (2008).

Notice.

Finding against the seller was improper under the pre-2001 version of this chapter where, although the company presented evidence of its usual procedure, which included sending notice to dealers, it offered no information about the advertising or solicitation of bids, the value of collateral, or whether the seller was notified. McDonald Mobile Homes, Inc. v. BankAmerica Hous. Servs., 93 Ark. App. 256, 218 S.W.3d 376 (2005) (decision under prior law).

Public Sales.

The disposition of a repossessed mobile home is, for the purposes of the pre-2001 version of the Uniform Commercial Code, analogous to that of a car or truck, and if the secured party is to become the purchaser, a public sale is necessary to satisfy the requirements of this subtitle. Benton v. General Mobile Homes, Inc., 13 Ark. App. 8, 678 S.W.2d 774 (1984) (decision under prior law).

Where seller sent notice of private sale to buyer as required by former § 4-9-504(3), placed the vehicle on a used car lot, and sold it two months subsequent to the redeemable time to a member of the general public, the sale was not a public sale; the two-month period between notice and sale was commercially reasonable under the pre-2001 version of this chapter. Harold Gwatney Chevrolet Co. v. Cooper, 41 Ark. App. 133, 850 S.W.2d 19 (1993) (decision under prior law).

Sale Agreements.

Notice and commercial reasonableness of sale of hens was immaterial under the pre-2001 version of this chapter where borrower who owned hens and against which lender held a security interest either agreed to or made the sale. Pine Bluff Prod. Credit Ass'n v. Lloyd, 252 Ark. 682, 480 S.W.2d 578 (1972) (decision under prior law).

Where debtor and bank reached a specific agreement about how the sale was to be conducted, the question of commercial reasonableness was immaterial under the pre-2001 version of this chapter. Becknell v. First Nat'l Bank, 740 F.2d 609 (8th Cir. 1984) (decision under prior law).

Secured Parties.

Where the seller of a dump truck had assigned the conditional sales contract to a bank and had guaranteed payment to the bank in the event of the buyer's default, the seller was a secured creditor of the buyer within the meaning of the pre-2001 version of this chapter. Tucker v. Scarbrough, 268 Ark. 736, 596 S.W.2d 4 (Ct. App. 1980) (decision under prior law).

Senior Secured Parties' Rights.

Under the pre-2001 version of this chapter, the plain meaning and logical implications of certain provisions may be preempted by a pervasive spirit of priority that supports giving a senior secured party a claim to the proceeds of a junior creditor's sale of collateral. Stotts v. Johnson, 302 Ark. 439, 791 S.W.2d 351 (1990) (decision under prior law).

Standard Price.

A NADA book did not make a used automobile “the subject of widely distributed standard price quotations” under the pre-2001 version of this chapter where the evidence was that the book was merely a guide to the price of a vehicle of that year, make, and model in an average condition. Carter v. Ryburn Ford Sales, Inc., 248 Ark. 236, 451 S.W.2d 199 (1970), overruled in part on other grounds, First State Bank v. Hallett, 291 Ark. 37, 722 S.W.2d 555 (1987) (decision under prior law).

Value of Collateral.

The fair market value under the pre-2001 version of this chapter was what a willing purchaser, under no compulsion to purchase, would have paid for the limited partnership units, recognizing what he was getting, which was, by any rational view of the evidence, a probable controversy with other investors in the organization; thus, the fair market value for such units was no more than was received for them at the sale. Becknell v. Quinn, 592 F. Supp. 102 (E.D. Ark. 1983), aff'd sub nom. Becknell v. First Nat'l Bank, 740 F.2d 609 (8th Cir. 1984) (decision under prior law).

It is only when the sale of repossessed collateral is conducted according to the requirements of the Uniform Commercial Code that the amount received or bid at a sale of collateral is evidence of its true value in an action to recover a deficiency under the pre-2001 version of this chapter. Henry v. Trickey, 9 Ark. App. 47, 653 S.W.2d 138 (1983) (decision under prior law).

Large discrepancy between sales price and fair market value signals a need under the pre-2001 version of this chapter for close scrutiny of sale procedures. Womack v. First State Bank, 21 Ark. App. 33, 728 S.W.2d 194 (1987) (decision under prior law).

Under the pre-2001 version of this chapter the value of the collateral seized is presumed equal to the amount due on the debt. Marks v. Powell, 162 B.R. 820 (E.D. Ark. 1993) (decision under prior law).

Under the pre-2001 version of this chapter the burden is on the secured party to prove the value of the collateral at the time of repossession. Marks v. Powell, 162 B.R. 820 (E.D. Ark. 1993) (decision under prior law).

Cited: Whitson v. Yaffe Iron & Metal Corp., 385 F.2d 168 (8th Cir. 1967); Commercial Credit Corp. v. Associates Discount Corp., 246 Ark. 118, 436 S.W.2d 809 (1969); Williams v. Westinghouse Credit Corp., 250 Ark. 1065, 468 S.W.2d 761 (1971); Hubbard v. Moore, 537 F. Supp. 126 (W.D. Ark. 1982); Everett v. Parts, Inc., 4 Ark. App. 213, 628 S.W.2d 875 (1982); Thomas v. International Harvester Credit Corp., 5 Ark. App. 244, 636 S.W.2d 296 (1982); United States v. Dawson, 929 F.2d 1336 (8th Cir. 1991); Bank of Bearden v. Simpson, 305 Ark. 326, 808 S.W.2d 341 (1991) (decisions under prior law).