A car financing company claims that the City of Yonkers is seizing cars illegally and turning them over to a towing company that demands unwarranted fees to return the cars.
Federal judges have ordered the city to change its “boot and tow policy” to comply with due process protections, Santander Consumer USA Inc. says in an Oct. 18 complaint filed in U.S. District Court, White Plains, yet Yonkers continues to turn cars over to vendors such as A.P.O.W. Towing in a mutually beneficial financial arrangement.
“Yonkers is well aware of the dictates of the United States Constitution when it comes to impounding vehicles,” the complaint states. “Yet Yonkers retains its outdated and unconstitutional practices.”
City spokeswoman Christina Gilmartin declined to comment on active litigation.
The current case concerns a 2018 Land Rover. The owner financed the car with Santander and defaulted on the loan, leaving Santander with a priority lien and the right to take immediate possession.
But in June 2021, Yonkers police took possession of the car and turned it over to A.P.O.W. The city never notified Santander about the seizure, according to the complaint, and A.P.O.W notified Santander about six or seven weeks after it took the Land Rover.
Santander asked A.P.O.W. to release the car but the company demanded towing and storage fees and claimed it had a lien on the car. As of Jan. 5 the fees totaled $7,700 and by Feb. 24 A.P.O.W. was demanding $10,251 and a “hold harmless” agreement.
“There is no law which requires Santander to pay Yonkers’ towing and storage bill for A.P.O.W.’s alleged services,” the complaint states.
The finance company argues that A.P.O.W. and the city are acting in concert.
The city has cars towed away at no cost, to enforce traffic laws or clear the streets after a criminal incident, according to the complaint, and it gets a portion of the payments that the towing company receives from car owners.
The arrangement allows A.P.O.W. to remove cars “under color of law,” Santander claims, in effect exercising policing power. If car owners do not meet A.P.O.W.’s demands, the tow company can eventually sell the car and keep the proceeds.
In this case, Santander says it has not been compensated for its loss even though it holds a priority lien.
Attempts to contact A.P.O.W. owner Harold Wuestenhoeffer for his side of the story were unsuccessful. But in June 2020, when he was briefly interviewed about a similar case involving Santander, he said “They just need to pay the towing and storage fees and pick up the vehicle and leave.”
The legal problem, according to Santander, is that Yonkers did not obtain a warrant or a court order to seize and impound the car, and it did not provide a hearing at which Santander could have contested the action.
Santander, Yonkers and A.P.O.W. have been down this road before, concerning a car seized and impounded in 2020.
On Sept. 12, federal judge Kenneth M. Karas ordered Yonkers to pay Santander $96,078 in attorney fees and costs. Yonkers appealed the ruling on Oct. 3.
In the current case, Santander is asking the court to declare that Yonkers and A.P.O.W. violated state and federal constitutional rights to due process and to order A.P.O.W. to pay unspecified damages.
Santander is represented by Manhattan attorney Nicholas Duston.
Time for some Yonkers city employees to get some jail time.