Ford Motor Credit v. Racwell Construction, Inc.

Francesco Racanelli and Racwell Construction, Inc. (defendants) (the lessees) leased a vehicle from Pleasantville Ford. The lessees agreed to make monthly payments for three years and had the option to buy the vehicle at the end of the lease term. The lease also provided that if the lessees defaulted on the lease terms or terminated the lease early, then the lessees would be liable for the difference between the lease-end purchase price of the vehicle and the proceeds of the vehicle’s sale. Pleasantville Ford authorized Ford Motor Credit Company, Inc. (Ford) (plaintiff) to enforce the lease. At the end of the lease term, the lessees chose not to purchase the vehicle but failed to return the vehicle as required by the lease. Approximately four months later, Ford repossessed the vehicle and sold the vehicle at private auction for less than the lease-end purchase price. Thereafter, Ford sued the lessees for breach of the lease and sought to recover $13,092.77, which represented the difference between the lease-end purchase price and the proceeds of the sale. The lessees counterclaimed and alleged that Ford had breached the lease by failing to cancel the lease before repossessing the vehicle. Both parties moved for summary judgment. The trial court ruled in Ford’s favor on both liability and damages and entered a judgment against the lessees for $13,092.77. The lessees appealed.