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Credit Contracts and Consumer Finance Act 2003

Repossession of consumer goods under consumer credit contract - Rules that apply after repossession of consumer goods

83Z: Rules relating to sale by creditor

You could also call this:

"Rules for creditors to sell repossessed goods fairly"

Illustration for Credit Contracts and Consumer Finance Act 2003

When a creditor sells goods they have repossessed, they must make sure the sale is fair. They have to take care to get the best price they can for the goods at the time of sale. The creditor must also tell the debtor and other people involved about the sale. The creditor has to give notice of the sale, including how it will happen and when and where. If the sale is by auction or tender, the creditor, debtor, and others can bid or submit tenders. If the creditor's bid is successful, the goods are considered sold for that price. The creditor is responsible for proving the goods were sold correctly. There are some cases where the creditor does not have to follow these rules, such as when the debtor finds a buyer or forces a sale, as described in section 83ZD and section 83ZF.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM6501387.

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Topics:
Money and consumer rights > Consumer protectionMoney and consumer rights > Banking and loans
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83Y: Creditor must offer consumer goods for sale, or

"Creditors must try to sell taken goods as soon as possible."

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83ZA: Debtor may obtain valuation of consumer goods before sale, or

"You can get your goods valued before they're sold"

Part 3ARepossession of consumer goods under consumer credit contract
Rules that apply after repossession of consumer goods

83ZRules relating to sale by creditor

  1. When selling repossessed consumer goods (which may be by any method that meets the requirements of this subsection), the creditor must—

  2. ensure that every aspect of the sale, including the manner, time, place, and terms, is commercially reasonable; and
    1. take reasonable care to obtain the best price reasonably obtainable for the goods as at the time of sale.

      1. The creditor must give the debtor and every other person referred to in section 83G(1) reasonable notice of the proposed sale (including the method of sale and the time, the place, and any reserve price placed on the goods, as applicable to the method of sale).

      2. If the sale is by auction or tender, the creditor, the debtor, and every other person referred to in section 83G(1) are each entitled to bid or to submit tenders, as the case may be, and if the creditor is the successful bidder or tenderer, the consumer goods, for the purposes of this subpart, are deemed to have been sold for the amount of the creditor’s bid or tender.

      3. The onus of proving that the consumer goods have been sold in accordance with this section is on the creditor.

      4. Subsection (1) does not apply if—

      5. the debtor introduces a buyer under section 83ZD and the buyer completes the purchase of the consumer goods; or
        1. the debtor forces a sale under section 83ZF.

          Compare
          Notes
          • Section 83Z: inserted, on , by section 51 of the Credit Contracts and Consumer Finance Amendment Act 2014 (2014 No 33).