Is The End buyer Exposed?

[Darkseid]

Hi all below is an interesting case. If an end buyer had purchased the car from the second hand dealer, is he exposed?

 

This brings up the issue of The Doctrine of Nemo Dat Quod Non Habet and Its Exceptions. Has good title over the vehicle passed, or did the end buyer inherit a flawed/defective title?

 

Is the End Buyer left picking up the treads or can he rely on some defences and exceptions to the doctrine so he does not have to give up the vehicle?

 

Can the bros here share their opinions for the sake of academic discussion pls?

 

 

Source

Straits Times

Date

10 Jul 2015

Author

Elena Chong

He cheated one woman of $90k and sold off Mercedes-Benz car belonging to another

A property agent was on the run for almost two years after he cheated a Chinese national of $90,000, and misappropriated a car worth $230,000 belonging to another. Yesterday, Lau Wing Kuan, 40, was jailed for 38 months.

He had pleaded guilty to deceiving Madam Wang Chunling, 60, a Chinese national, into believing that a shophouse in South Bridge Road was for sale and inducing her to give him a cheque for $90,000 on July 12 , 2012.

He had also admitted to misappropriating the Mercedes-Benz coupe of Ms Huang Luyang, and forging the 27-year-old Singapore permanent resident's signature on a cheque for $270,000.

The court heard that in July 2012, Madam Wang issued Lau a cheque for $40,000, as the 1 per cent option money, to buy a property.

A few days later, he persuaded her to forfeit the $40,000 and to buy another property in South Bridge Road instead, even though he knew it was not for sale.

On July 12 that year, Madam Wang agreed and issued another cheque for $90,000, being the 2 per cent option money, to buy the South Bridge Road property.

She signed the cheque and handed it to Lau, who filled in the remaining details. The cheque was made out to Ms Huang.

Separately, some time in June that year, before leaving for China to work, Ms Huang entrusted her Mercedes-Benz coupe to Lau.

He was supposed to send the car for servicing and return the car keys to her friend after that.

When Ms Huang returned to Singapore a few months later, she found out that the car had been sold and was no longer registered under her name. She made a police report after failing to contact Lau.

Investigations showed that Lau had sold the car to a second-hand dealer for $186,000.

He had earlier couriered a Land Transport Authority authorisation form, among other documents, to Ms Huang in China to sign.

To get his hands on the sale proceeds, he opened a bank account in Ms Huang's name by forging her signature on the application form. He then banked in the money from the sale of the car as well as the $90,000 cheque from Madam Wang.

Later, he used the cheque book and forged Ms Huang's signature on a cheque for $270,000, issued it to himself and encashed it.

He used $83,000 to pay off personal debts before fleeing to Malaysia with the remaining money.

Lau's lawyer Louis Joseph said his client had cooperated with the authorities upon surrendering himself. He has two young children, one of whom is severely autistic and is a danger not only to others but also himself .

Lau could have been jailed for up to 10 years and fined for cheating; and jailed for up to seven years and fined for criminal breach of trust.

Background Storey

Lau's lawyer Louis Joseph said his client had cooperated with the authorities upon surrendering himself.

He has two young children, one of whom is severely autistic and is a danger not only to others but also himself.

Source: Straits Times © Singapore Press Holdings Ltd. Permission required for reproduction.

 

 

 

 

[Atlantis]

My view is that the end-buyer did not have proper title over the car even though he paid a sum for it. Clearly, the car was sold to the car dealer by an individual who did not have proper title of the car. As such, title did not flow to the car dealer. This is a fraudulent case and the car dealer can only go after the property agent with a civil suit (ditto for the end-buyer who has to go after the car dealer).

[Darkseid]

Thanks, but I think LTA would not have allowed a valid transfer of ownership to end buyer if their records did not already show the car dealer had proper title.

 

As you correctly pointed out, the fraud occurred between the property agent and car dealer.  So arguably the end buyer is "once removed" from the earlier flawed transaction?

 

If the end buyer is still exposed, this will open up potential flood gates as it becomes a inherent risk when we buy cars from second hand dealers?

My view is that the end-buyer did not have proper title over the car even though he paid a sum for it. Clearly, the car was sold to the car dealer by an individual who did not have proper title of the car. As such, title did not flow to the car dealer. This is a fraudulent case and the car dealer can only go after the property agent with a civil suit (ditto for the end-buyer who has to go after the car dealer).

[Atlantis]

"Ownership" as reflected in LTA's records does not equate to having title over the vehicle. An illustration of this would be the typical hire purchase loan taken for a vehicle finance. In such an instance, title would have reside with the bank or finance company providing the HP loan but if the hirer logs on to one motoring to do an asset enquiry, they will notice that they (being the individual himself) would be the owner of the vehicle.

Back to this case - if proper title had not transferred from Huang to Lau, there is nothing to talk about further. The victims will ultimately be the car dealer and the end-user.