Mack Financial Corp. v. Scott (1980)

Citation: 100 Idaho 889, 606 P.2d 993 · Court: Supreme Court of Idaho, Docket No. 12716 · Decided: February 21, 1980 · Opinion: Bakes, J. primary source

Source note (2026-10-18):

• Links on this page to https://static.case.law/idaho/100/cases/0889-01.json are an (unofficial Caselaw Access Project copy, retrieved before 2026-10-18; host disallows automated access); no official or otherwise permitted full-text copy was located on 2026-10-18.

Opinion text retrieved 2026-10-17 from the Caselaw Access Project’s static copy of the Idaho Reports (static.case.law, Idaho volume 100 archive), an unofficial host. primary source

Facts

Mack Financial financed seven Mack trucks later assumed by Scott Trucking, with personal guaranties from Lee Scott. After default in February 1970 the trucks were surrendered and held in Mack’s Denver yard for nearly two years before a January 1972 public auction that brought USD 44,700 against about USD 127,600 owed. Mack sued for a deficiency of over USD 85,000. The trial court found the unexcused two-year delay depreciated the trucks and made the disposition commercially unreasonable.

Holding

Affirmed; no deficiency. Idaho adopted the “rebuttable presumption” rule: when a secured party fails to give proper notice or to dispose of repossessed collateral in a commercially reasonable manner (then I.C. § 28-9-504(3)), the collateral is presumed to have been worth the full debt at repossession, and the secured party must prove its actual fair market value to recover any deficiency. Mack offered no such proof. The guarantor, whose guaranty covered only the debtor’s deficiency, owed nothing either.

Reasoning

The Court surveyed three lines of authority (absolute bar; deficiency allowed subject to debtor’s damages claim; rebuttable presumption) and chose the rebuttable presumption as balancing the creditor’s right to its debt against the debtor’s protection from an improper sale.

Complete disposition and limits

Part II independently rejected Mack’s unconditional-guaranty argument: unconditional describes immediate resort to the guarantor after default, not waiver of collateral protections. Unlike the cited New Mexico agreement, Scott’s guaranties contained no express collateral/subrogation waivers. The court did not decide whether Scott Trucking and Scott personally were the same legal debtor. Judgment affirmed, costs to respondent. Current §§ 28-9-617 and 28-9-626 are statutory successors with their own scope; this opinion did not construe them. primary source

Practical impact

• Buyers at a repossessing lender’s auction are not affected by the deficiency rule; under current I.C. § 28-9-617 a good-faith transferee takes the debtor’s rights free of the security interest even if the secured party failed to comply.
• Lenders that delay or mishandle a disposition of vehicles or equipment risk losing the deficiency entirely.
• Debtors and guarantors can put compliance in issue and shift the burden to the lender.

Good-law status

The full reporter opinion was retrieved and its holdings, disposition, dissent where present and operative statutory changes were checked on 2026-10-17. The prior draft records a through-2017 CAP archive scan; that historical statement is not a newly rerun archive/citator search. Current targeted name/reporter/statute searches did not locate a contrary holding on the precise forced-sale point, but this is not a comprehensive negative-treatment certificate. The retrieved district bankruptcy opinion in A.W. Logging discusses and applies the rebuttable-presumption doctrine; it is later application under its own facts, not a new state high-court holding or a decision under every current consumer rule. Full text: primary source

Applies in →

idaho · ucc-article-9-dispositions · motor-vehicles · equipment-and-machinery

Legal information, not legal advice. This case summary is limited to the retrieved decision and stated verification boundaries.