Clark v. EZN, INC.

EZN, Inc., a Kentucky corporation, and A. W. Morgan (Debt- or) appeal from a $143,574 deficiency judgment entered in favor of Jeffrey L. Clark (Creditor.) We affirm. Although the foreclosure sale was not conducted in a commercially reasonable manner, substantial evidence supports the trial court’s finding made pursuant to California Uniform Commercial Code, section 9504, subdivision (2)(c), that the value of the loan security ($150 per unit) was greater than the foreclosure sale price ($25 per unit). As we shall explain, the recent California Supreme Court case of Ford & Vlahos v. ITT Commercial Finance Corp. (1994) 8 Cal.4th 1220 [ 36 Cal.Rptr.2d 464 , 885 P.2d 877 ], does not speak to the situation where the trial court imputes a fair sales price and renders a judgment thereon.

Facts and Trial Court Proceedings

Debtor is the inventor of a foldable steel ramp that attaches to the back of a truck tailgate. The ramps are manufactured by EZN Proprietary, Ltd., an Australian corporation. Debtor distributes the ramps through EZN, Inc., a Kentucky corporation.

Debtor defaulted on a $225,000 promissory note and security agreement. The agreement recited that the 500 truck…