Legal Bibliography
Deficiency Judgment

    Daphne duPhus, paralegal, was laid off by her firm in December and as a result could not afford to maintain payments ($385.00 per month) on her Camaro. In fact she quickly fell three payments behind. She recently received a letter from Cosmic Finance & Acceptance Corp. (CF&AC) demanding immediate payment in full of all arrearages. The letter also contained a "right to cure" notice informing her that she had 30 days to pay or the company would accelerate the balance on her car loan ($12,000) and repossess her car.

    Daphne was very concerned about maintaining a good credit record, so she took the car back to CF&AC on March 5th. After talking to her loan officer, she turned in her keys and left the car in the parking lot. At the time, Daphne's car had a NADA book value of $14,000.

    Yesterday, Daphne received a letter from CF&AC stating that her car had been sold at a private sale for $4,500.00, of which $4,000.00 had been applied to the balance of her loan and $500.00 retained by CF&AC to cover the costs of repossessing and selling her car. The letter warned her that unless she paid the remaining balance of $ 8,500.00 on her loan within ten days, the company would sue her.

    Daphne is upset. She had expected to get a refund from CF&AC when her car was sold, and now she's being dunned for $8,000 for a car she doesn't even own any more. She is particularly upset because she learned that a college-aged son of one of the loan officers at CF&AC purchased the car. She would like to sue CF&AC.

    Please address the following issues in a memo, following the formatting instructions below:

        (1) Is CF&AC entitled to a deficiency judgment under the circumstances described above?

        (2) What, if any, basis does Daphne have for a defense CF&AC's claim?

        (3) What, if any, basis does she have for a countersuit against CF&AC?

Format for Memo

1.     STATEMENT OF FACTS: Summarize the legally significant facts (those facts that will have a direct bearing on the result) in our case.

2.     QUESTION PRESENTED: Identify the legal issue that arises from the facts.

3.     BRIEF ANSWER: State how the legal issue will be resolved by the courts. Include a brief explanation of why the issue will be resolved in this manner.

4.     TABLE OF AUTHORITIES: List all legal authority employed in your discussion. Do not list authority you read unless you employed it in your memo. Use proper citation style. Consult the Blue Book (available in the library) or the style sheet handed out during the first class.

5.     DISCUSSION: This is the main portion of your memo. Explain the law. Develop your explanation in detail, using the "CRAC" structure.

6.     CONCLUSION: Summarize your discussion. Focus on the results and the reasons compelling them. If necessary, set out the steps the lawyer or paralegal should take to accomplish whatever task you researched.