![]() ![]() The only issue presented in this appeal is whether the district court's denial of Hyundai Finance's post-verdict motion for judgment as a matter of law was erroneous. Hyundai Finance then moved for judgment as a matter of law concerning the amount of damages, arguing that the “uncontroverted evidence at trial established Hyundai's damages to be, not the that the jury awarded.” The district court disagreed on the merits. Although the jury found in favor of Hyundai Finance on its breach of contract claim and rejected the defendants' counterclaims, the jury found that the amount of damages suffered by Hyundai Finance was $276,000. After accounting for additional fees and expenses as well as the proceeds from the sale of other collateral, Hyundai Finance determined that McKay Motors still owed $609,000 in principal and fees and $210,000 in interest, for a total deficiency of $819,000.Īt trial, Hyundai Finance sought to recover damages in the amount of $819,000. Hyundai Motor repurchased seventeen of those vehicles for $344,000 and Hyundai Finance sold the remaining twenty-nine vehicles at auction for $383,000, which resulted in a total credit to McKay Motors of $727,000. This amount included the SOT balance ($448,000) and the principal due on forty-six vehicles remaining in McKay Motors's inventory ($911,000). On January 9, 2007, the district court ordered McKay Motors to deliver its inventory and the other collateral at the dealership to Hyundai Finance for liquidation.Īccording to Hyundai Finance's calculations, McKay Motors owed $1.36 million at the time Hyundai Finance took possession of the collateral. As of that date, the SOT balance had increased to $448,000. On December 20, 2006, Hyundai Finance filed this diversity action for breach of the inventory loan and security agreement. By December, it was clear that the closing would not occur. Over the next two months, however, this loan agreement unraveled. McKay accepted the terms of Hyundai Finance's proposal. ![]() The proposed loan agreement was subject to numerous conditions, including McKay Motors having $400,000 in cash on hand at the time of closing to apply to its SOT balance and other outstanding debts with Hyundai Finance. On September 8, 2006, Hyundai Finance sent a letter to McKay and Company, LLC (“McKay and Company”), a separate entity managed by Mr. McKay allegedly responded to Hyundai Finance's initial demand by indicating that he would need a loan to pay off the SOT balance due to a shortage of operating capital at McKay Motors, among other things. Hyundai Finance did not exercise its right to take possession of McKay Motors's inventory, nor did it take other steps to stop McKay Motors from doing business. McKay, the namesake and guarantor of McKay Motors, to inform him of the deficit and to demand immediate payment. On that date, Hyundai Finance sent a letter to Mr. As of July 19, 2006, McKay Motors had an “SOT balance” of $228,000, 2 meaning that McKay Motors owed Hyundai Finance $228,000 for vehicles sold out of trust. In July 2006, during a routine audit, Hyundai Finance discovered that McKay Motors had sold vehicles “out of trust”-that is, without remitting the amount of the outstanding advances on those vehicles to Hyundai Finance in a timely manner. In the event that McKay Motors defaulted, Hyundai Finance was authorized to take possession of the collateral and dispose of it by any commercially reasonable means, including by selling certain types of vehicles to Hyundai Motor under a separate repurchase agreement. ![]() Hyundai Finance took a security interest in the inventory and other collateral at McKay Motors's dealership. In turn, McKay Motors agreed to remit to Hyundai Finance the amount of the outstanding advance on each vehicle that it sold. Hyundai Finance agreed to provide floor plan financing for McKay Motors's inventory of Hyundai vehicles. In January 2005, McKay Motors entered into an inventory loan and security agreement with Hyundai Finance, a so-called “captive finance company” for Hyundai Motor America (“Hyundai Motor”), the distributor of Hyundai vehicles in the United States. Hyundai Finance appeals the district court's denial of its post-verdict motion for judgment as a matter of law concerning the amount of damages. ![]() In this diversity action for breach of contract, the district court 1 entered judgment on a jury verdict in favor of Hyundai Motor Finance Company (“Hyundai Finance”) against McKay Motors I, LLC (“McKay Motors”) and John P. Wewers, argued, Little Rock, AR, for appellee. Coleman, on the brief, Little Rock, AR, for appellant. Decided: July 31, 2009īefore WOLLMAN, MELLOY and GRUENDER, Circuit Judges. HYUNDAI MOTOR FINANCE COMPANY, Appellant, v. United States Court of Appeals,Eighth Circuit. ![]()
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