## Facts

- Guadalupe Baldazo bought an automobile from Villa Oldsmobile, Inc. on credit, signing a secured promissory note payable in 48 monthly installments and granting a security interest in the vehicle.
- The note permitted acceleration upon default but did not include a waiver of notice of acceleration.
- Villa Oldsmobile assigned the note to General Motors Acceptance Corporation (GMAC).
- After about a year, Baldazo lost his job, stopped making payments, and voluntarily surrendered the vehicle to GMAC.
- GMAC sent Baldazo a letter stating that unless he paid delinquent installments and related charges by a stated date, GMAC would sell the vehicle and Baldazo would remain liable for any deficiency if sale proceeds did not satisfy the debt.
- GMAC collected the note balance from Villa Oldsmobile and reassigned the note to Villa Oldsmobile, which then sold the vehicle for roughly $4,000 less than the amount owed.
- Villa Oldsmobile sued for the deficiency; Baldazo counterclaimed alleging unfair or deceptive trade practices related to repossession, notice, and resale.
- After a bench trial, the court awarded Villa Oldsmobile a deficiency judgment of $4,187.11 plus interest, attorney’s fees, and costs, and denied Baldazo’s counterclaims.

## Issues

1. Whether a creditor may recover a post-sale deficiency when the debtor did not receive a separate notice explicitly stating that the debt was accelerated.
2. Whether the repossession, notice, resale, and deficiency suit constituted unfair or deceptive trade practices.
3. Whether alleged noncompliance with secured-transactions notice or sale requirements barred recovery of a deficiency.

## Decision

- The court of appeals affirmed the deficiency judgment and the take-nothing judgment on Baldazo’s counterclaims.
- The court held that the letter warning of sale and continued liability for any deficiency provided sufficient notice in substance, notwithstanding the lack of a separate document labeled “notice of acceleration.”
- The court rejected Baldazo’s unfair or deceptive trade practices claims because the record supported the trial court’s findings that the creditor’s conduct and communications were not deceptive.
- The court concluded that the notice and disposition of the collateral were not shown to violate secured-transactions requirements in a manner that would defeat the deficiency claim, and the sale was not shown to be commercially unreasonable.

## Legal Principles

- When a contract allows acceleration and notice of acceleration is not waived, the adequacy of notice may be evaluated by the substance of the creditor’s communications rather than formal wording.
- A notice advising the debtor of default, providing an opportunity to cure, stating that the collateral will be sold, and warning that the debtor remains liable for any deficiency may suffice to support a deficiency judgment.
- A creditor’s routine enforcement of a secured note after default, with required notice and a commercially reasonable disposition, does not by itself establish unfair or deceptive trade practices.
- A debtor seeking to avoid a deficiency based on improper notice or an unreasonable sale must produce evidence showing a defect that legally bars recovery.

## Conclusion

The court affirmed a deficiency judgment for the auto dealer, holding that the debtor received sufficient notice through a default-and-sale letter warning of continued deficiency liability, and that the repossession and resale were not proven deceptive, unlawful, or commercially unreasonable.


Baldazo v. Villa Oldsmobile, Inc., 695 S.W.2d 815 (Tex. App.—Amarillo 1985, no writ)