## Facts

- Shirley Woods-Witcher financed a vehicle through a revolving line of credit with American General Financial Services, Inc., secured by the vehicle.
- After Woods-Witcher defaulted, American General repossessed the vehicle.
- On November 13, 2002, American General sent Woods-Witcher notice stating the vehicle would be sold at a public sale at auction no earlier than December 5, 2002, and that she could attend and bring bidders.
- The vehicle was not sold in December; it was sold on May 22, 2003 for $2,400 at a dealer-only auction not open to the general public.
- After applying net sale proceeds and deducting expenses, American General claimed an approximately $20,000 deficiency and sued Woods-Witcher to recover it.
- Woods-Witcher counterclaimed for statutory damages, asserting the notice did not comply with the Virginia Uniform Commercial Code (Virginia UCC), which the parties agreed governed the notice and disposition requirements.
- The trial court denied American General summary judgment on the deficiency claim, granted Woods-Witcher summary judgment on the counterclaim, and awarded statutory damages; American General appealed.

## Issues

1. Whether the creditor’s pre-sale notice complied with the Virginia UCC requirement to provide reasonable, accurate notice of the method of intended disposition (public vs. nonpublic) and the relevant time information.
2. If the notice was noncompliant, whether the creditor was barred from recovering a deficiency and whether the debtor was entitled to statutory damages.

## Decision

- The Court of Appeals of Georgia affirmed.
- The notice was insufficient under the Virginia UCC because it described a public sale and an opportunity to attend, but the vehicle was sold at a dealer-only auction.
- Because American General did not comply with the Virginia UCC notice requirements, it was not entitled to a deficiency judgment.
- Woods-Witcher was entitled to statutory damages for the creditor’s noncompliance, and the damages award was affirmed.

## Legal Principles

- Under the Virginia UCC, a secured party disposing of collateral after default must send the debtor reasonable notification that accurately states the method of intended disposition and the required time/time-after-which information.
- A dealer-only auction not open to the public is materially different from a public disposition; mischaracterizing the method of sale defeats the purpose of notice, including the debtor’s ability to attend and bring bidders at a public sale.
- A secured party seeking a deficiency bears the burden to show compliance with UCC requirements governing notice and disposition; noncompliance can bar a deficiency claim.
- The Virginia UCC authorizes statutory damages when a secured party fails to comply with its notice and disposition obligations.

## Conclusion

The court held that a creditor’s notice stating a public sale, followed by a dealer-only auction sale, failed the Virginia UCC’s accuracy requirements; the creditor therefore could not recover a deficiency, and the debtor was entitled to statutory damages.


American General Fin. Servs., Inc. v. Woods-Witcher, 294 Ga. App. 685, 669 S.E.2d 709 (Ga. Ct. App. 2008)