We posted the news of Judge Holly's preliminary settlement approval in July. Since then, more than 6,000 class members were sent Class Action Notices that allowed them to object to the settlement or opt out. Nearly 1,500 of those class members had made post-repossession deficiency payments to WFS and were sent Claim Forms that allowed them to get all of that money back.

Judge Holly's approval of the Settlement Agreement requires WFS to mail cash payments to all class members who submitted timely Claim Forms. It also requires WFS to stop collecting any deficiency balances from class members, to update its records to reflect an account balance of zero, and to electronically instruct Equifax, Experian and TransUnion to delete the tradelines associated with all of the class members' WFS accounts. That means that class members with poor credit reports due to WFS's tradeline will have that tradeline removed from their credit reports.

WFS must stop collecting against class members and instruct the credit reporting agencies to delete its tradeline by January 2, 2008 and must mail the cash payments to class members by January 7, 2008.

The judgment is final as to all class members except 143 people, to whom WFS said it mistakenly sent Class Action Notices without Claim Forms. Those persons made post-repossession payments to WFS and will be re-sent Notice with Claim Forms so they will have an opportunity to get their money back.

No one objected to the settlement, and only one class member asked to be excluded. Several class members came to the final approval hearing and were pleased that the settlement was approved.

Yesterday the California Supreme Court rejected the petition of Arcadia Financial Ltd. to review the Court of Appeal's decision or to depublish it. This is great news for California consumers!

Several other California auto finance companies had also asked the Supreme Court to depublish the decision. They claimed that it was too difficult for them to comply with the Court of Appeal's interpretation of California law. The Court's interpretation requires these companies to tell consumers exactly what they need to do to reinstate, including how much they have to pay and to whom, including names and addresses.

The Supreme Court's decision to reject review and to refuse to depublish means the Court of Appeal's decision is binding, not only on Arcadia but on other California auto finance companies as well. If the Supreme Court had depublished, the opinion would not have been binding on other auto finance companies, only on Arcadia. If the Supreme Court had accepted review, it could have adopted the Court of Appel's conclusions or formed its own independent opinion. As the Court of Appeal said:

"Creditors must provide consumers with sufficient information to allow consumers to fulfill all of the conditions the consumer must meet before a creditor will reinstate the contract. Arcadia's NOI does not satisfy these requirements."

This means that if consumers receive NOIs that do not tell them everything they need to do to reinstate, they are not liable for any deficiency following the sale of their repossessed vehicle. We think this is a huge victory for California consumers.

Yesterday the California Supreme Court rejected the petition of Arcadia Financial Ltd. to review the Court of Appeal's decision or to depublish it. This is great news for California consumers!

Several other California auto finance companies had also asked the Supreme Court to depublish the decision. They claimed that it was too difficult for them to comply with the Court of Appeal's interpretation of California law. The Court's interpretation requires these companies to tell consumers exactly what they need to do to reinstate, including how much they have to pay and to whom, including names and addresses.

The Supreme Court's decision to reject review and to refuse to depublish means the Court of Appeal's decision is binding, not only on Arcadia but on other California auto finance companies as well. If the Supreme Court had depublished, the opinion would not have been binding on other auto finance companies, only on Arcadia. If the Supreme Court had accepted review, it could have adopted the Court of Appel's conclusions or formed its own independent opinion. As the Court of Appeal said:

"Creditors must provide consumers with sufficient information to allow consumers to fulfill all of the conditions the consumer must meet before a creditor will reinstate the contract. Arcadia's NOI does not satisfy these requirements."

This means that if consumers receive NOIs that do not tell them everything they need to do to reinstate, they are not liable for any deficiency following the sale of their repossessed vehicle. We think this is a huge victory for California consumers.

Check out Karen Aho's informative article and advice.

Many consumers are unaware that, because the right to simply tow away the car is a drastic remedy for the creditor, California has significant consumer protection laws in place to prevent abuse of the process. The important thing is to act quickly. In the event of a wrongful repossession, or if the creditor's Notice of Intent to sell the car is defective, it is important for the consumer to get legal help before it is too late.

Fall behind in your car payments, and you might see a tow truck haul away your vehicle in broad daylight or hear them hooking it up under cover of night. Generally the repo man has no qualms about coming on Christmas, New Years, or in the midst of your daughter’s birthday party. It’s dirty and sometimes dangerous work. Sympathy is scarce. More often at the point of the taking, their attitude is “devil take the deadbeat,” or worse.

Suddenly you can’t get to work, or to the doctor, or to school. If you have been shuffling notices about your increasing debt, you might be prepared. But most people confronted with a repossession are left in a state of shock. Faced with this unpleasantness, or even a family crisis, it is important to remember that behind every tow truck driver in a t-shirt is a banker in a business suit. Not so long ago, people got loans from their local bank, where they knew their local banker. Today auto loans are assigned from the car dealer to a bank, which might have bundled and sold the loans at a discount to a collector handling accounts from out-of-state.

But bankers make mistakes. So do the digital databases on which they rely. In fact, it is remarkable how often they don’t do it right. We have seen cases in which there was no default in the first place, cases in which no proper notice was given, and cases in which the repo man took someone else’s car. If your name is Sam Smith, Jennifer Lee, or Jose Garcia, you might lose your car if Samuel, Jenny, or Joe didn’t pay. Instances of both mistaken identity and identity theft are seriously on the rise.

Not only is wrongful taking of the car itself a form of theft, or “conversion” as it is called in the civil context, but in some circumstances, the taker may be liable for loss of anything else that was in the car. We have had clients who had left everything from kid’s soccer uniforms in the trunk, to homework in the back seat, to the family Bible in the glove compartment. Some losses are merely inconvenient, but others are tragic.

The right of repossession is one of the few times that the law allows property to be taken without a court’s stamp of approval in the form of a warrant, order or judgment. It is called a “provisional remedy” in favor of the creditor in order to provide speedy relief, when someone doesn’t pay the bills they have promised to pay. Because it is so drastic a remedy, California has strong consumer protection laws in place.