Kenneth West agreed to sell his car, a 1975 Corvette, to a man representing hims
ID: 425027 • Letter: K
Question
Kenneth West agreed to sell his car, a 1975 Corvette, to a man representing himself as Robert Wilson. In exchange for a cashier’s check, West signed over the Corvette’s title to Wilson and gave him the car. Ten days later, when West learned that the cashier’s check was a forgery, he filed a stolen vehicle report with the police. The police could not immediately locate Wilson or the Corvette, however, and the case grew cold. Nearly two and a half years later, the police found the Corvette in the possession of Tammy Roberts, who also had the certificate of title. She said that she had bought the car from her brother who had obtained it through an ad in the newspaper. West filed a suit in a Colorado state court against Roberts to reclaim the car. Replies are due by the end of the day Sunday.
Did Roberts have good title, assuming that she bought the car without knowledge of circumstances that would make a person of ordinary prudence inquire about the validity of the seller’s title?
Should the original owner of a vehicle that he or she relinquished due to fraud be allowed to recover the vehicle from a good faith purchaser?
If not, whom might the original owner sue for recovery?
Explanation / Answer
Roberts had good title because she is a good faith purchaser as she bought the car without the knowledge of circumstances that would make a person of ordinary prudence inquire about the validity of the seller’s title and also the car is not a theft vehicle. The car was sold to Robert Wilson by Kenneth West and Wilson has cheated West by giving a cashier’s check which later found to be forgery. Hence the incident comes under fraud and car cannot be considered as a stolen vehicle as it is acquired by Wilson through fraud. In such a case, the title passed to Wilson from West is not void and it is only voidable. If a person acquires the car from Wilson out of good faith, good title will pass to the good faith purchaser and the original owner would not have the title of good. Hence Roberts has the title of the car and she is the rightful owner of Corvette.
The original owner of the car would not be allowed to recover the vehicle from a good faith purchaser even if the owner proves fraud because the title of the good acquired through fraud was voidable and it has been already transferred to the good faith purchaser. In the case of voidable title, the title of the good would be transferred to the good faith purchaser from the person who acquired it through fraud. The car can be recovered only if it the car was a stolen property as the title of the good would be void and the title would not pass to the good faith purchaser in such a case.
The original owner should sue the person who has exercised fraud to recover the damages. In this case Kenneth West should sue Robert Wilson for recovering the damages for the injuries West suffered through the cashier’s check given by Wilson which was forgery.
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