NAC490.535. Sale of repossessed off-highway vehicle in commercially reasonable manner; application of proceeds; injunctive relief; damages.  


Latest version.
  •      1. Every repossessed off-highway vehicle must be sold in a commercially reasonable manner. The fact that a better price could have been obtained by a sale at a different time or in a different method from that selected by the secured party is not of itself sufficient to establish that the sale was not made in a commercially reasonable manner. If the secured party sells the off-highway vehicle in the usual manner in any recognized market for the off-highway vehicle, sells at the price current in the market at the time of the sale or has otherwise sold in conformity with reasonable commercial practices among off-highway vehicle dealers in the type of off-highway vehicle sold, the secured party has sold in a commercially reasonable manner. A disposition which has been approved in any judicial proceeding shall be deemed conclusively to be commercially reasonable, but such a disposition does not indicate that any such approval must be obtained in any case and does not indicate that any disposition not so approved is not commercially reasonable.

         2. The proceeds of a disposition must be applied in the following order:

         (a) The reasonable expenses of retaking, holding, preparing for sale and selling, and, to the extent provided for in the agreement, the reasonable attorney’s fees and legal expenses incurred by the secured party.

         (b) The satisfaction of indebtedness secured by the security interest under which the disposition is made.

         (c) The satisfaction of indebtedness secured by any subordinate security interest in the collateral if written notification of demand therefor is received before distribution of the proceeds is completed. If requested by the secured party, the holder of a subordinate security interest must seasonably furnish reasonable proof of his or her interest, and unless he or she does so, the secured party is not required to comply with his or her demand.

         (d) The payment of any surplus to the debtor.

         3. If it is established that the secured party is not proceeding in accordance with the provisions of this section and NAC 490.530, a disposition may be ordered or restrained on appropriate terms and conditions. If the disposition has occurred, the debtor or any person entitled to notification or whose security interest has been made known to the secured party before the disposition has a right to recover from the secured party any loss caused by failure to comply with the provisions of this section. If the disposition was not commercially reasonable, as specified in subsection 1, the debtor has a right to recover double his or her actual damages.

     (Added to NAC by Dep’t of Motor Veh. by R130-11, 6-29-2012, eff. 7-1-2012)