Brunswick Acceptance Company, LLC v. MEJ, LLC

When MEJ, LLC (defendant) defaulted on a financing agreement with Brunswick Acceptance Corp, LLC (Brunswick) (plaintiff), MEJ surrendered its inventory of seven boats to Brunswick. MEJ, Brunswick, and their attorneys met to discuss the sale of the seven boats. The parties agreed that the attorneys would communicate directly regarding sales. Brunswick purchased three boats, so they were not at issue. Four boats remained. For the sale of a 30-foot Bayliner (boat 1) and a 27-foot Maxum (boat 2), Brunswick’s attorney notified MEJ’s attorney via email of an upcoming sale and the price on August 15, 2005. MEJ’s attorney responded on August 18 that MEJ agreed the boats were being sold for a good price. That sale later fell through, and Brunswick’s attorney emailed MEJ’s attorney on September 4, indicating another buyer would be sought. Months passed before boats 1 and 2 were sold on June 26, 2006. On November 10, 2005, MEJ’s attorney was notified via email of the upcoming sale and the price for a 31-foot Maxum (boat 3). Boat 3 sold that same month. Also, on February 1, 2006, Brunswick’s attorney notified MEJ’s attorney of the upcoming sale of a 42-foot Maxum (boat 4), which was sold in April 2006. Each boat sold for less than the invoice price, and Brunswick’s notices indicated the amount of each deficiency. Brunswick sued MEJ for the total amount of the deficiency. A circuit court ruled in favor of Brunswick. MEJ appealed, arguing, among other things, that Brunswick’s notifications did not technically comply with Tennessee’s version of Article 9 of the Uniform Commercial Code (UCC), which required a creditor to give a debtor notice of the upcoming sale of collateral, include a time after which collateral will be sold, give the debtor a chance to find another buyer, and state that the debtor is entitled know the amount of deficiency.