Since 2006 Wisconsin creditors have legally been allowed to repossess cars without a replevin. A replevin is similar to a foreclosure where a creditor files suit in court and asks the court to grant an order for repossession of a car when a person has not kept up with payments. The advantage of a replevin is that Creditors obtain an order that is enforceable by the Sheriff. It also protects the car owner by giving the debtor a right to be heard in court and to protect his interests, such as by working out a compromise. The disadvantages of the replevin only affect the creditor, however. It is more expensive because it involves the courts and legal processes, and it takes more time to complete because car owners have a right to fight the repossession and present defenses.
Replevin was the only method available to creditors until 2006 and provided maximum protection to both the creditor and the debtor. Creditors lobbied for a cheaper method and the Self Help Rule was adopted.
The Wisconsin New Self Help Rule for Creditors of Car Loans
Creditors now have the right to avoid using the courts to repossess a car. Almost all banks and dealers are now using this method to take cars by the hundreds across Wisconsin. In exchange for granting this limited self help right, Wisconsin added restrictions to protect the car owner from abuses that are inherent to self help legal action. In order to repossess your car, the creditor must, among other things:
* notify you that you are in default and give you a right to cure
*send you a notice by certified or registered mail of the intent to repossess and offer you a 15 day period in which you have the right to demand a hearing
*notify the authorities of the time and place of repossession
If the creditor fails to comply with the law the repossession is illegal and the car owner is entitled to significant statutory damages. In addition to the requirements, the creditor is forbidden to:
*enter the private dwelling or garage
*breach the peace
*violate other laws
Limited Rights of the Repossessor and their Agents under Self Help
The creditor and its agents have limited rights when taking your car. For example, if your car is in plain view in the driveway, they can come onto your property to take the car. They may not cut any wires, break locks or open gates, mover other property, etc. For this reason, agents usually try to grab the car in a public lot, from the street, etc. They can ask for your cooperation and, if you specifically give permission, they can enter the garage, etc.
Under no circumstances may a re-possessor using self help break any laws. Often a contractor for a bank will flash important looking papers and demand that you allow them onto your property, in your garage, to move property, etc. The Self Help Rule gives them none of these powers and strictly prohibits certain actions. The right under Self Help is limited to temporary trespass in open view and to take the car only if the notice requirements have been met exactly as required by law.
Rights of the Car Owner and Property Owner
Self Help allows a limited trespass only. The right is lost as soon as the self help becomes unlawful. This becomes unlawful if the notice and other requirements were not followed, or there is ANY breach of the peace by any party. Breach occurs immediately when you protest. You have the right to:
*Demand that they immediately cease their trespass and leave your private property
*Demand that they leave your car alone and cease the repossession
*Continue to protest in any legal manner and create a breach of the peace
*As in any civil matter, remain free from police interference
Self help is a civil matter with no court authorization. As a result, the police have no right to step in and assist the creditor in repossessing the car. That can only happen when the court issues a replevin, and then it is up to the Sheriff to assist. Often times the police are called by the agents, look at the self help papers and erroneously assume that they have a right or duty to assist.
Other Prohibited Acts of Creditors and Police
It is violation of your civil rights for the police to arrest, threaten or assist in any manner in a civil dispute. Unless a crime is being committed, you have every right to expect the police to stay out of your business, and that includes self help repossession. Most consumers don't know this and the banks count on it. Many police officers are under the mistaken belief that they have authority to help the bank in an otherwise "legal" repossession. It is important to know that 1. the "legal" repossession becomes "illegal" if notice was not proper or as soon as a breach occurs of any kind, and 2. self help is civil and outside police jurisdiction. As soon as you protest openly, breach has occurred and the self help repossession is no longer lawful.
Otherwise, it is prohibited for the agent to:
*touch or assault you
*take or keep property from inside your car
*enter your home or anything attached to it
*remain on your property if ordered to leave
Breaching the Peace and Stopping a Repossession
Although a failure to follow the notice requirements is common, it is often not easy to determine that during a hectic and heated repossession. If you are not around when the car is repossessed, and the agent did not break any laws in taking the car, your only recourse is to determine whether or not the notice rules were followed precisely. If not, you have a cause of action and the bank will suffer statutory damages if you sue.
If you are around and you do not agree with the repossession, you have a right to protest. The court of appeals has determined that "breach of the peace" can mean anything "from the word 'No'" and results from any party. Without committing a crime yourself, creating a breach is the easiest way to make the self help repossession unlawful and prevent the agent from legally taking the car. You can:
*scream and holler (use 'no' more than once)
*stand in front of the car
*block them from your property
*call the police
*enlist help of neighbors
Protect Yourself and Your Case
Evidence that the peace was breached or that notice was not proper are key to winning a case for illegal repossession. Keep all documents received. During a repossession, make sure that you have someone taking pictures/videos of the breach (yelling 'no' at the agent, standing in front of the car, etc.) Get the neighbors involved (the more witnesses to the breach, the better), do not open your garage door for the agents, even under the threat of arrest. The police cannot come into your attached garage to look for narcotics without a warrant, yet some people believe when it comes a repossession (self help) that they must comply and open the garage because the policeman says so. If the agent, or policeman, open your garage without you asking them to, it is an egregious violation of the statutes.
At all times remember that while you have a right to stop a self help repossession, on your property or otherwise, you do not have a right to break the law yourself.
What Happens Next?
The Banks know that few consumers understand the law regarding repossessions. The agents taking the cars don't understand the law any better. In most cases, they end up getting the cars. If notice was not proper or a breach of the peace occurred, you have a cause of action against all parties. In this case you will quickly want to hire any attorney familiar with unlawful repossession, and civil rights if the police assisted the agent.
In Wisconsin damages are set by statute for violating the rules under the Self Help rule, and they are severe. You are also entitled to your attorney's fees. If the peace was breached, you not only have a right to the statutory damages but punitive damages are now allowed in addition to compensatory and special damages. Potential claims would be:
*Conversion of property
*Trespass to property
*Trespass to chattel
*Breach of contract
The extremely strict requirements of the Self Help Rule, along with the severe penalties for creditors violating them, have not benefited or protected most car owners and consumers. Lack of knowledge of debtor's rights and protections granted by the act have allowed banks and other creditors to repossess cars at will. Economically it is cheaper for them to break the rules and face a rare law suit now and then as a cost of doing business, than it is to follow the rules or seek a replevin.
Knowing your rights and how to react to a repossession under the Self Help Rule is the best method of protection and ensuring that your car is either not taken unlawfully, or for being compensated adequately if it is.