Secured Transactions in Consumer Purchases

Consider the following scenario: Janice buys a refrigerator on credit from Excelsior Appliances. Janice's sales agreement treats the appliance as collateral. Janice loses her job; so, she sells the refrigerator to Henry and at the same time quits making payments to Excelsior. Henry is unaware of Excelsior's interest when he buys the refrigerator from Janice.

a.When Excelsior tries to reclaim the refrigerator, the company discovers that Janice has sold the item to Henry. In your opinion, what do you think would be the fairest result?

b.Assume now that under the state law, Henry, as a good-faith purchaser who had no knowledge of Excelsior's prior interest got to keep the refrigerator. What remedy, if any, should Excelsior have against Janice?

c.Assume, instead, that Excelsior recovers the appliance from Janice and resells it. It is now a used refrigerator; therefore, the company recovers only $500 on resale while Janice still owes $750. What is Excelsior's remedy, if any, against Janice for the remaining money that Janice owes?

Similar Questions
  1. Select the correct answer.Sheldon bought a new TV for his apartment with his credit card. Which type of credit is demonstrated
    1. answers icon 1 answer
    1. answers icon 1 answer
  2. Which information would NOT appear on a consumer's credit report?• The balance owed on the consumer's credit cards • The
    1. answers icon 1 answer
  3. What is true about open-end credit?It is not typically used for a single purchase but for many purchases over a period of time.
    1. answers icon 1 answer
more similar questions