In Indiana, a cause of action for “replevin” will come into play if your lending institution collateralized its loan with tangible personal property and if your borrower defaulted on such loan. For more on the fundamentals of a claim for replevin in Indiana, keep reading.
Vocabulary. Black’s Law Dictionary defines replevin as follows:
An action whereby the . . . person entitled to repossession of [personal property] may recover [it] . . . from one who . . . wrongfully detains such [personal property]. Such action is designed to permit one having the right to possession to recover property in specie from one who has either wrongfully taken or detained property.
In this context, a lender is the person entitled to repossession of the property, and a defaulting borrower is the one who has wrongfully detained the property.
Indiana statute. Ind. Code § 32-35-2 governs replevin actions. The detailed statute provides the procedural steps to repossess personal property. Section 1 states that grounds for an action for replevin exist:
If any personal goods, including tangible personal property constituting or representing choses in action, are:
(1) wrongfully taken or wrongfully detained from the owner or person claiming possession of the property; or
(2) taken on execution or attachment and claimed by any person other than the defendant;
the owner or claimant may bring an action for the possession of the property.
When lenders seek to enforce a security interest in, for example, a borrower’s equipment, counsel should include a count for replevin, which will result in a court order granting the right to repossess the equipment. A count for replevin typically will be in addition to a count for damages based upon a promissory note/credit agreement.
Indiana case law. Indiana judicial opinions provide further insight into replevin actions. “To succeed on his claim for replevin, [plaintiff] must prove by a preponderance of the evidence that the [defendant] wrongfully held or detained property that belonged to him.” Whittington v. Indianapolis Motor Speedway Foundation, Inc., 2008 U.S. Dist. LEXIS 62760 (S.D. Ind. 2008) (The Court determined, in a case involving an antique car, that the transaction was a gift, rather than a loan. Because the plaintiff failed to prove that he had a possessory interest in the car, his claim for replevin failed.) See also, Schaefer v. Tyson, 2009 U.S. Dist. LEXIS 4536 (S.D. Ind. 2009) (Replevin action dismissed by six-year statute of limitations.) In McCready v. Harrison, 2009 U.S. Dist. LEXIS 1518 (S.D. Ind. 2009), Judge David Hamilton noted, generally, that:
- “A replevin action is a speedy statutory remedy designed to allow one to recover possession of property wrongfully held or detained, as well as any damages incidental to the detention.”
- Reasonable loss of use damages may be recovered in a replevin action; I.C. § 32-35-2-33 provides that judgments for plaintiffs in replevin actions may be for (1) delivery of the property, or the value of the property in case delivery is not possible and (2) damages for the detention of the property.
To repossess and, ultimately, liquidate most non-real estate loan collateral in Indiana, asset-based lenders and their legal counsel need to be familiar with I.C. § 32-35-2 and the applicable case law.
I represent parties involved in disputes about loans. If you need assistance with a similar matter, please call me at 317-639-6151 or email me at firstname.lastname@example.org. Also, don’t forget that you can follow me on Twitter @JohnDWaller or on LinkedIn, or you can subscribe to posts via RSS or email as noted on my home page.