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Simply put, any violation of law is considered to be a Breach of the Peace. It also is made
abundantly clear in case law nationwide and within the UCC that creditors are directly liable
for the acts of the collateral Recovery Agents they hire, even if the specialist is hired as an
“independent contractor.” Courts have determined there are “inherent” risks associated with self-
help repossession, and therefore the creditor has a non-delegable duty to ensure there is no violation
of law during the process.

For these reasons, it is important to be knowledgeable about federal and state laws affecting the self-
help repossession process, which you will find referenced in this C.A.R.S. National Certification
®
Program. Violating any of these laws is considered a Breach of the Peace. I have been a consultant
and provider of expert opinion in numerous cases involving self-help repossession, and at the end of
this commentary I will provide an example of how each violation is considered a Breach of the
Peace.

Another area of critical importance is “Color of Law.” Abundant case law, as well as established
federal law, speaks quite clearly against using law enforcement assistance in self-help repossessions.

The following language is from the Federal Civil Rights Act: “Every person who, under color of
any statute, ordinance, regulation, custom, or usage, of an State or Territory, subjects, or
causes to be subjected, any citizen of the United States or other person within the jurisdiction
thereof to the deprivation of any rights, privileges, or immunities secured by the Constitution
and laws, shall be liable to the party injured in an action at law, suit in equity, or other proper
proceeding for redress.”

In First & Farmers Bank v. Henderson (763 SW 2d 237 KY App. 1988) the court stated that, “if
the “strong arm” of the law is needed, the creditor must secure judicial intervention (Replevin,
etc.) when a police officer is carrying out or sanctioning the repossession.”

In citing prevailing New Hampshire case law, the court stated: “We believe, therefore, that the
introduction of law enforcement officers into the area of self-help repossession, regardless of
their degree of participation or nonparticipation in the actual events, would constitute state
action, thereby invalidating a repossession without proper notice and hearing.’’

As stated previously, courts often look to case law in other states to support their decisions. In our
case law reviews in this section of the C.A.R.S. Program we occasionally will mention such instances.
From established case law throughout the country it is critical to re-emphasize that the “chain of
liability” in the self-help repossession process leads directly to the creditor.

Should you become involved in litigation regarding self-help repossession, we recommend making
the C.A.R.S. Program available to your legal counsel. Attorneys who have reviewed the program say
it is very helpful and saves time and effort (which saves you attorney’s fees).

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