BAGEL BREAK BAKERY, INC., A FLORIDA CORPORATION, AND DOMINIC GELOSO, APPELLANTS,
v.
BAGELMAN'S, INC., A FLORIDA CORPORATION, APPELLEE
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Bagel Break Bakery appealed a judgment for $41,975.64 owed to Bagelman's on two promissory notes secured by baking equipment. The court held that Bagelman's failed to provide reasonable notice before selling the secured equipment, thus forfeiting the right to recover a deficiency on the $50,000 note.
Two days' notice is not reasonable under the circumstances. Although inadequate notice does not vitiate the sale itself, it precludes the creditor from recovering a deficiency on the secured note.
[1] A secured creditor's failure to provide reasonable notice of a private sale of collateral precludes recovery of a deficiency judgment.
[2] Two days' notice of a private sale of collateral is not reasonable under the circumstances.
Previewing 2 of 4 headnotes on this case. FLexlaw’s editorially structured points of law — every proposition, pinpointed — are reserved for members.
Join FLexlaw to unlock all legal intelligence“Section 679.504(3), Florida Statutes (1981), requires reasonable notification of the time after which any private sale or other disposition is to be made of the property. We hold that under the circumstances of this case two days notice is not reasonable.”
Establishes the statutory requirement for reasonable notice and the court's holding that two days is inadequate
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Join FLexlaw to unlock all legal intelligenceBagelman's sold baking equipment to Bagel Break, securing one $50,000 note with a lien on the equipment. When Bagel Break defaulted and was locked out…
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DOWNEY, Judge.
Bagel Break Bakery, Inc., seeks reversal of a final judgment for $41,975.64 in favor of Bagelman’s, Inc. The judgment arose out of a suit commenced by Bagelman’s based upon two promissory notes, one for $7,000, the other for $50,000. The parties stipulated that the balances due on the notes was $6,400 and $46,594.61 respectively. The $50,000 note was secured by a lien on certain baking equipment sold by Bagel-man’s to Bagel Break. While the notes were in default, the landlord locked Bagel Break out of the premises. Thereupon, Ba-gelman’s, Inc., obtained entry and sold the equipment, receiving therefor $15,500.
The evidence reflects that, prior to selling the equipment, which was the subject of the security interest, the only notice given to Bagel Break was by Bagelman’s lawyer who called Bagel Break’s lawyer to tell him they were going to sell the equipment “shortly.” In fact, they sold it two days later. Section 679.504(3), Florida Statutes (1981), requires reasonable notification of the time after which any private sale or other disposition is to be made of the property. We hold that under the circumstances of this case two days notice is not reasonable. Failure to give notice does not vitiate the sale, but it precludes the creditor from recovering a deficiency. Hepworth v. Orlando Bank & Trust Company, 323 So. 2d 41 (Fla. 4th DCA 1975); Turk v. St. Petersburg Bank and Trust Company, 281 So. 2d 534 (Fla. 2d DCA 1973). Since the notice of sale here involved was not reasonable, Bagelman’s, Inc., is not entitled to recover a deficiency on the $50,000 note.
Accordingly, we reverse the judgment appealed from and remand the cause with directions to enter a new judgment for Ba-gelman’s, Inc., for $6,400, the balance due on the $7,000 note, and reassess attorney’s fees based on that note only.
REVERSED AND REMANDED with directions.
DELL and WALDEN, JJ., concur.
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Fence Wholesalers OF Am., Inc. v. Beneficial Commercial Corp., 465 So. 2d 570 (Fla. 4th DCA 1985)…tention of the appellants, notice to the defendants prior to the tractor’s sale was not required, and the private sale of the tractor had no effect on the lessor’s right to seek a deficiency judgment. Cf. Bagel Break Bakery, Inc. v. Bagelmans, Inc., 431 So. 2d 676 (Fla. 4th DCA 1983). We detect error only in the amount of attorney’s fees awarded, as indicated at the beginning of this opinion. BARKETT, J., concurs. WALDEN, J., concurs in part and dissents in part with opinion.…
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Gepetto's Tale O' THE Whale OF Fort Lauderdale, Inc. v. Landmark First Nat'l Bank of Fort Lauderdale, 481 So. 2d 1282 (Fla. 4th DCA 1986)…ion that failure to comply with the statutory notice requirement precludes any action for a deficiency judgment against the guarantors. See Siltzer v. North First Bank, 445 So. 2d 649 (Fla. 2d DCA 1984); Bagel Break Bakery, Inc. v. Bagelman’s, Inc., 431 So. 2d 676 (Fla. 4th DCA 1983); Motorola Communications & Electronics, Inc. v. National Patient Aids, Inc., 427 So. 2d 1042, 1046 n.10 (Fla. 4th DCA 1983); Dependable Insurance Co. v. Landers, 421 So. 2d 175 (Fla. 5th DCA 1982); Barnett Bank v. Campbell, 402 S…
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B.F. Goodrich Co. v. D & A Tires, Inc., 458 So. 2d 433 (Fla. 4th DCA 1984)…PER CURIAM. Affirmed on the authority of Hepworth v. Orlando Bank & Trust, 323 So. 2d 41 (Fla. 4th DCA 1975); Bagel Break Bakery, Inc. v. Bagelman’s, Inc., 431 So. 2d 676 (Fla. 4th DCA 1983); Motorola Communications and Electronics, Inc. v. National Patient Aids, Inc., 427 So. 2d 1042 (Fla. 4th DCA 1983); Dependable Insurance Co. v. Landers, 421 So. 2d 175 (Fla. 5th DCA 1982); Barnett v. Barnett Bank of Jack [*434] s…
Authorities Cited
- Turk v. ST. Petersburg Bank & Tr. Co., 281 So. 2d 534 (Fla. 2d DCA 1973)
- Hepworth v. The Orlando Bank & Tr. Co., 323 So. 2d 41 (Fla. 4th DCA 1975)