Lone Bidder Ends Up With Friendly Ford : Bankruptcy: The sale to an Encino car dealer is approved in court after other potential buyers drop out.

The sale of troubled Friendly Ford was approved in federal bankruptcy court here Thursday in what once promised to be a spirited auction but became a fait accompli when all but one bidder dropped out.

So Encino luxury car dealer Terry York, who had been in escrow to buy the dealership when it went into bankruptcy April 2, won the court’s blessing to buy the major assets of Huntington Beach-based Friendly. The price of about $1.4 million was 22% lower than the $1.8 million York had agreed to pay before Friendly filed for protection from creditors under Chapter 11 of the U.S. Bankruptcy Code.

Only 15 months ago, Friendly was offered for sale for about $5 million, owner Richard G. Wilson testified Thursday.

But that price was set before the dealership was raided by state Department of Motor Vehicle agents and then sued for consumer fraud by the state attorney general’s office.

Testimony in court revealed that new car sales at Friendly have plunged to about 40 a month from nearly 300 a month before the bankruptcy petition was filed.

Separately, Bankruptcy Judge John E. Ryan refused Thursday to order York to assume responsibility for about 6,000 extended warranties sold by Friendly.

Friendly is citing its bankruptcy status in refusing to honor warranties sold before it filed for Chapter 11. The dealership is performing work under the warranties but is requiring customers to pay for the repairs and then bill the insurance company that underwrites the warranties.

York, in a brief interview after Thursday’s hearing, said he “is just glad it is all over.” He said he expects the deal to close by or before mid-August and that the dealership will then begin operating as Terry York Ford.

York had expected the court to approve his purchase offer last week, but Ryan delayed action until Thursday to give other potential buyers a chance to enter bids.

The Encino dealer faced challenges from three potential buyers when Ryan gaveled the hearing to order Thursday, but one withdrew when the judge refused a further postponement. The others--Friendly’s landlord and a Northern California Ford dealer--withdrew after Ryan required the sale to close within 30 days and said the successful bidder’s $100,000 deposit would be forfeited if the sale was not consummated.

The landlord, Newport Beach investor Howard Abel, said in a prehearing interview that he was interested in buying Friendly to void the lease--which has eight years left to run. With 12 other Ford dealers in the county, he said, the parcel, on heavily traveled Beach Boulevard, is more valuable under some other use.

York, however, said he believes there is enough of a car market in Orange County to support a dealership there.

Friendly Ford, which had operated for years as Wilson Ford, changed its name but not its ownership following a highly publicized raid by DMV agents in August, 1989.

On March 29, the state attorney general filed a $3-million fraud suit against Friendly and several of its principals and officers. The suit alleges that Friendly--and Wilson Ford before it--systematically used misleading, high-pressure sales tactics to persuade customers to sign contracts obligating them to pay far more money for their cars than the low prices at which the vehicles were advertised.

That suit, initially filed in Orange County Superior Court, has been moved into bankruptcy court, where a hearing is pending.