One of the most important steps of the repossession process is the personal property inventory. Any veteran of the auto repossession business can tell you scores of stories about debtors claiming that the Rolex watch or diamond ring they left in their vehicle was missing. Of course, someone that owns a $20,000 watch or ring can certainly make their car payment, right? In any case, these sort of claims might be leveled against your company, and you will want to protect yourself from this window of liability. You might be thinking that a debtor would not be able to pursue a lawsuit because they are a “deadbeat” that won’t be able to afford a lawyer to file the case on alleged missing property. I have known of more than one repossession company that thought the same thing, and lost a suit filed by the debtor all on their own, without paying a lawyer a dime.
Your Word Choice Can Make or Break You
When you inventory someone’s property, make sure you are very detailed and careful with your descriptions. Never say a gold ring or a gold watch, but rather describe these items as “gold colored”. Be sure you never call a watch by its brand name, as it might be a knock-off. Your description of an item might place more value on it than what it is actually worth. Complete your detailed property inventory, listing all items, and have one last entry of “various personal papers and trash” if those items are indeed found in the car. I know of some company owners that video inventories of personal property that are over a certain value.
Make sure you safely and securely store all of the debtor’s property in a container that is clearly marked with the debtor’s name, the lender, the account number and the date of repossession. The date record will allow you to track when the property can be disposed of. We never stored any liquids found in a vehicle because we did not want them spilling on any of the debtor’s other items. We also feared the possibility of a HAZMAT situation if chemicals leaked and came into contact with other liquids. If you choose to store liquids, make sure the containers are tightly sealed and stored on a level surface, and consider putting the container into a plastic bag. Always store any valuables, guns, jewelry and cash in your company safe. If you do not have a safe, then get one. All property should be stored in a locked area that is accessible by a limited number of people. Property in my company was only accessible by our lot man or by me as the owner.
Contact your local police jurisdiction if you find illegal contraband, such as drugs or drug paraphernalia in a debtor’s car. Make sure you obtain a police report when they take custody of it. I can remember finding a revolver with the serial number obliterated off it in a brown paper bag in a police officer’s truck we repossessed. The ATF and internal affairs division of his police department was very happy to take custody of what might have been used as a drop gun. That debtor is now a former police officer convicted of several crimes, including making death threats to an ATF agent. He tried to file a lawsuit on us for turning over the gun to the ATF, claiming we caused him to lose his job, even though he had multiple criminal charges. Our detailed incident report and property inventory stopped his claim cold.
When it comes to a property inventory, more is always better than less. The more detail, the better. Your company will have more creditability when the report is neat, concise and consistent.