When A Dealer Sells You A Stolen Car
My client bought a late model used car from a dealer in Metro Detroit. A few days later, the police showed up at his house and towed it away. They told him the dealer had sold him a stolen car. He contacted the dealer and they told him, “Tough luck.” Someone had ripped them off by selling it to them so they said they were in the same boat as my client.
Except they had my client’s money and now my client had nothing. As you might imagine, we filed suit. If you are thinking about getting a new car though, then you will want to make sure that the Car Dealer that you use is legit and you won’t have the same problem that my friend has.
In this case, the stolen vehicle had been titled with a “cloned” VIN – and from what we heard, the VIN they used came off of a vehicle from far away. The vehicle sold to my client had been stolen and the thieves replaced the dash VIN tag with one which matched the other vehicle. (Illustration photo is not from my client’s car. Props go to the first person to tell me what it is from and where it is parked.)
Of course, very few people check the other places where VINs are hidden to see if all the VINs on a vehicle match and the thieves didn’t replace those. That’s how the police knew that the vehicle in my client’s drive was stolen.
Of course, the dealer put up a fight. What was their defense? They sold the vehicle “as-is”! Yup, the old, “Get Out Of Jail Free” card every car dealer in Michigan waves around when they find themselves in the crosshairs.
Of course, an “as-is” disclaimer only disclaims the Implied Warranty of Merchantability. It does not disclaim the Warranty of Title. “The warranty of what now?” you ask.
Whenever a seller in Michigan (and in most other states) sells something, they warrant that they are doing so by transferring a clear and unencumbered title – and that they have the right to do so. Yes, they had to pass a law to spell that out. Otherwise, some dummies at a car dealership would say they could legally sell you a stolen car and get away with it. And, when the dealer sold the stolen vehicle to my client, they did not hold legal title to the vehicle, it being stolen and whatnot. The state application for title (RD-108) even contains language spelling this out, in case the dealer feigns unawareness of the law.
And No, all the disclaimers in the world won’t disclaim the language the state of Michigan required you to CERTIFY.
The case eventually settled. “Eventually” in this context means that an attorney appeared for the dealer and argued with me and the court for a little while that his client was a victim here too and that my client needed to track down the crime ring that stole the vehicle and sue them. No one bought it. All I know is that I saw a check sitting on my desk made out to my client a short while later. Could this happen to you? Possibly. I don’t expect everyone out there to check the frame rails of a car they are buying to make sure the VIN is correct once they’ve seen a 2005 dodge ram daytona for sale that they like, but at least glance at the VIN tag on the dash to see if it looks original. I’ve seen ones that were tampered with and they usually aren’t as pretty as the factory-installed tag.