Legal Question in Consumer Law in Wisconsin

I purchased a used travel trailer from a private seller. During the transaction, I was provided with a clean State of Missouri title in the sellers name which accurately described the travel trailer year and VIN number which the seller then signed over to me. I was also provided with a signed bill of sale indicating the VIN number of the travel trailer, the purchase price, and date of sale.

As required by the State of Wisconsin, I immediately registered the travel trailer in my name by submitting the required registration form, the signed transferred title, and payment for licensing and taxes. I subsequently received a clean official State of Wisconsin for the travel trailer in my name.

I was recently contacted by local law enforcement informing me that the travel trailer I purchased may be stolen. If, upon further inspection, it is determined that the travel trailer licensed in my name is indeed the suspected stolen item, they would then proceed to seize the vehicle as evidence.

It was reported to me that the insurance company that had insured the travel trailer has already compensated the original owner in full for the loss.

As an innocent purchaser, do I retain the legal title of the vehicle? Per the UCC sections 1-201(9) and 2-403, specifically the good faith doctrine or innocent purchaser doctrine, I should retain the legal title.

In my limited research, I found the following:

In both commercial and noncommercial law, persons who in good faith pay a fraudulent seller valuable consideration for property are protected from another person who claims legal title to the property. If a court establishes the purchaser's good faith defense, the person who claims title has recourse only against the fraudulent seller. Strong public policy is behind the good faith defense. Good faith doctrines enhance the flow of goods in commerce, as under them, buyers are not required, in the ordinary course of business, to go to extraordinary efforts to determine whether sellers actually have good title. A purchaser can move quickly to close a deal with the knowledge that a fraudulent seller and a legitimate titleholder will have to sort the issue out in court. Of course, the purchaser will be required to demonstrate to the court evidence of good faith.

Any advise or direction would be greatly appreciated.


Asked on 9/09/09, 1:18 pm

1 Answer from Attorneys
JAY Nixon nixon law offices

You definitely need to retain an attorney as soon as possible While an innocent purchaser defense is certainly a good argument for you to make, it would be difficult to overcome the title of the innocent victim of the theft. The original owner will therefore generally get stolen property back, and their insurer who paid the loss probably stands in their shoes.. You, however, will certainly have a claim against the seller, and, if you insured the vehicle, a possible claim against your own insurer recover your loss. For any titled asset, such as real estate or a vehicle, there are due diligence requirements that the seller my meet in order to prevail as a holder in due course or innocent buyer, as you call it. It therefore probably always makes sense to run a DOT title check before buying an expensive vehicle in order to make sure that the seller's title is not counterfeit, as yours apparently was. These are only off hand comments; I have not researched this issue. My comments are not intended as legal advice and do not create an attorney client relationship between us.

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Answered on 9/14/09, 11:05 pm


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