## Facts

- Ted Moe, a South Dakota farmer, purchased a John Deere 8850 tractor from Day County Implement Company under a retail installment contract.
- Moe traded in two tractors and agreed to pay the remaining balance in five annual installments due each October 1 from 1984 through 1988; the contract was assigned to John Deere Company as secured creditor.
- Deere accepted Moe’s first installment paid roughly two months late.
- For the second installment, Deere extended time for payment and accepted a partial late payment, followed by additional communications seeking to bring the account current.
- After further delay, Moe and a Deere representative discussed an arrangement under which Moe would make a partial payment and pay the remaining balance after wheat harvest; the discussion did not specify definite due dates.
- On July 30, 1986, while Moe was out of state, Deere repossessed the tractor without prior notice of repossession to Moe.
- After repossession, the contract was reassigned to the dealer, which sold the tractor privately, paid Deere the contract balance, and sent surplus proceeds to Moe’s bank.
- Moe sued Deere and the dealer for wrongful and fraudulent repossession, commercially unreasonable sale, and failure to account for surplus under UCC Article 9.
- The trial court granted summary judgment to both defendants on all claims, effectively treating Moe as in default as a matter of law.

## Issues

1. Whether genuine issues of material fact existed as to whether Moe was in default at the time of repossession, given the parties’ course of performance and communications.
2. Whether Deere’s repeated acceptance of late/partial payments and the alleged harvest-time arrangement could be found to have modified or waived strict payment terms, requiring reasonable notice and an opportunity to cure before repossession.
3. Whether these factual disputes made summary judgment improper on Moe’s repossession-related and UCC disposition/accounting claims.

## Decision

- The South Dakota Supreme Court reversed the grant of summary judgment and remanded.
- The court held that material fact disputes existed concerning whether Moe was in default when Deere repossessed the tractor.
- The court further held that a fact-finder could conclude Deere’s course of conduct modified the parties’ payment expectations and could support a requirement of reasonable notice before repossession.
- Because reasonable inferences from the evidence could differ, the case could not be resolved as a matter of law at the summary judgment stage.

## Legal Principles

- Under UCC concepts of course of performance and course of dealing, a creditor’s repeated acceptance of late or partial payments may constitute waiver or modification of strict contractual deadlines.
- When a creditor’s conduct creates a reasonable expectation of leniency, whether the debtor is in “default” may become a fact question rather than a purely contractual date-based determination.
- A course of conduct may support an obligation to provide reasonable notice and an opportunity to cure before a creditor treats the debtor as in default and exercises self-help repossession.
- Summary judgment is improper where the parties’ communications, the terms of any informal payment arrangement, and the inferences to be drawn from their conduct are genuinely disputed.

## Conclusion

The court held that the parties’ payment history and alleged harvest-based arrangement created triable fact questions about default and whether Deere was required to give notice before repossessing, requiring reversal of summary judgment and a remand for further proceedings.


Moe v. John Deere Co., 516 N.W.2d 332 (S.D. 1994)