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lwpat, Attorney
Category: Business Law
Satisfied Customers: 25387
Experience:  Attorney with over 35 years of business experience.
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I sold a company but kept a security interest in the collateral

Customer Question

I sold a company but kept a security interest in the collateral including some manufacturing equipment. The buyer has failed to make payments under the terms of the note, but has taken the manufacturing equipment with him when he abandoned the business. How do I go about legally getting my collateral back if I know he is hiding it in the garage to his apartment.
Submitted: 8 years ago.
Category: Business Law
Expert:  lwpat replied 8 years ago.
Here I hope that you filed a UCC-1 with the Texas Secretary of State. If you did not then you need to do so now.

You can file an action for claim and delivery or replevin
Replevin is one of the oldest forms of action known to common law, first appearing about the beginning of the thirteenth century. It was a legal procedure for claiming the right to have personal property returned from the possession of one who had less right to hold it than the plaintiff. Originally the action may have been available only for the recovery of goods that were illegally held past the time the defendant had the right to their possession, but soon the right was extended to cover every situation, whether the defendant wrongfully took or just withheld another's property. As time passed, if the goods themselves could not be recovered, the courts sometimes gave judgment for an amount of money representing the value of the goods. Generally, however, replevin aimed at restoring the property itself to the person entitled to possess it. The defendant could not claim as an excuse that the property belonged to someone not involved in the lawsuit because the only issue before the court was rightful possession, not title. For example, an executor of an estate could seek replevy of racehorses boarded by the decedent if the owner of the stable refused to release them. It would be no defense that the executor was not the owner of the horses.