#### JAMES TALCOTT, INC., Appellant, v. Edward ECKERT and Valerie Eckert, his wife, Appellees.

No. J-450.

District Court of Appeal of Florida. First District.

March 4, 1969.

Rehearing Denied April 1, 1969.

Peter J. Winders of Carlton, Fields, Ward, Emmanuel, Smith & Cutler, Tampa, for appellant.

Ernest C. Wimberly, Fort Walton Beach, for appellees.

SPECTOR, Judge.

Appellant, plaintiff below, seeks review of an adverse judgment in a replevin action by which it sought possession of a house trailer against which it has a recorded lien.

The question presented by this appeal is whether the evidence adduced at the final hearing was sufficient to support the lower court’s finding that appellant had no right to possession as against a subsequent purchaser, appellees herein.

The appellees purchased the used trailer in question from a retail dealer, Quality Mobile Homes, Inc. The sale to them was through the medium of a conditional sales contract calling for monthly payments to a bank to which the conditional sales con*18tract was assigned. Prior to the sale of the house trailer to appellees, Quality had sold it to one Holland as a new unit and the sale to Holland was financed through appellant, a commercial lender. As an incident to the acquisition of the conditional sales contract between Quality and Holland, appellant caused its lien thereunder to be recorded with the Motor Vehicle Department in the manner provided by law. Prior to the sale to Holland, the unit was held for sale by Quality under a “floor plan” arrangement by which Talcott advanced the funds for new units purchased for resale by Quality. Under the floor plan arrangement, Quality had actual authority to sell the new units so no complaint arises from the sale to Holland.

Shortly after the sale to Holland, the latter defaulted on the payments and Quality was notified to take possession of the trailer. Under the terms of the Quality-Holland conditional sales contract which had been assigned to Talcott, Quality was obligated to repurchase the contract and payment therefor was repeatedly demanded from Quality by Talcott.

The trailer in question was repossessed from Holland on or about January 11, 1966, and placed on Quality’s lot. It was sold to the Eckerts on July 26, 1966. The trailer’s absence from Quality’s lot was first noticed on September 14, 1966, during the course of routine periodic inspections made by Talcott relating to the new units Talcott was floor planning for Quality. The testimony of Talcott’s manager was that upon noting the absence of the trailer, he immediately inquired about it and upon learning that it had been sold demanded immediate payment for the contract in accordance with the repurchase agreement. The trailer was not under any floor plan arrangement and the Talcott manager testified that his company had not authorized the resale of the trailer.

At the time of the sale to appellees, no effort was made by Mrs. Eckert, she being the one who negotiated for the trailer, to investigate as to any outstanding liens before making the purchase. Mrs. Eckert gave testimony that she knew the trailer was used. The record reflects that Mrs. Eckert was not unacquainted with motor vehicle titles and liens thereon and also that she was aware that at times title problems arose when vehicles were sold twice.

It is clear that Mrs. Eckert chose to rely upon the representations of the seller as to the condition of the title for the house trailer she purchased.

By misplacing her reliance upon the dealer, appellee ran squarely against the statutory scheme devised by the legislature to protect the relative interests of motor vehicle purchasers, dealers, and financial institutions whose funds underwrite much of the motor vehicle industry.

Section 319.22(1), Florida Statutes, F.S.A., provides that:

> “ * * * no person acquiring a motor vehicle from the owner thereof, whether such owner be a dealer or otherwise, hereafter shall acquire a marketable title in or to said motor vehicle until he, she, or it shall have had issued to him, her or it a certificate of title to said motor vehicle; nor shall any waiver or estoppel operate in favor of such person against a person having possession of such certificate of title or an assignment of such certificate for said motor vehicle for a valuable consideration. Except as otherwise provided herein, no court in any case at law or in equity shall recognize the right, title, claim or interest-of any person in or to any such motor vehicle, hereafter sold or disposed of, or mortgaged or encumbered, unless evidenced by and on a certificate of title duly issued, in accordance with the provisions of this law.”

Notwithstanding the foregoing statutory provision, the trial court held that appellant’s recorded lien was for naught as against the appellee’s. Appellant contends this holding is erroneous and contrary to the ruling of the court in Boynton *19Beach State Bank v. Wythe, 126 So.2d 283 (Fla.App.1961). We agree and reverse.

In Boynton, supra, the court was confronted with a factual situation materially similar to the one at hand and held that the purchaser of a used house trailer had the duty to investigate as to any outstanding liens before making the purchase. The court stated at page 284:

> “The Wythes were apprised of facts calling for inquiry, hut they relied upon the representations of the Coles and were deceived by them. At the time of the purchase, they did not check with the motor vehicle commissioner as to liens or otherwise; * * * Under the controlling statutes as applied to the circumstances of this case, the Wythes were not innocent purchasers for value without notice and they did not attain a title free of plaintiff’s claim. See Sections 319.22(1) and 319.27(2), Florida Statutes, F.S.A.; May v. Citizens National Bank of Orlando, Fla.App.1958, 100 So.2d 651; Dicks v. Colonial Finance Corporation, Fla.1956, 85 So.2d 874; and McQueen v. M. & J. Finance Corp., Fla.1952, 59 So.2d 49.”

Appellee relies heavily in support of the judgment being reviewed upon the Supreme Court’s holding in Motor Credit Corporation v. Woolverton, 99 So.2d 286 (Fla.1957). There the court held that a lien-holder on a motor vehicle who placed said vehicle on a dealer’s lot upon repossession from a prior purchaser and gave the dealer actual authority to sell the vehicle was estopped from asserting his lien as against a second purchaser for value. Although the court considered the provisions of Section 319.22(1) and held them inapplicable, it did so on the principle of agency arising out of the actual authority to sell conferred upon the dealer after the vehicle was repossessed from the first purchaser. In so holding, the court expressly stated that it was not deciding what effect should be given the statute in cases where the second purchaser buys from one who has only apparent authority to sell the vehicle as distinguished from actual authority to sell. We do not think the Woolverton case to be applicable to the facts reflected in the record in the instant case since there is no evidence that appellant gave the dealer actual authority to sell the trailer in question. In absence of such facts, we are reluctant to depart from the clear statutory scheme devised by the legislature to protect the trichotomy of interests obtaining among lender, seller, and buyer in disputes relating to motor vehicle titles and liens.

Accordingly, the judgment appealed is reversed.

WIGGINTON, Chief Judge, concurs.

JOHNSON, Judge

(dissenting).

I cannot agree with the majority opinion in this case.

The majority opinion cites as authority for its reversal the case of Boynton Beach State Bank v. Wythe, 126 So.2d 283 (Fla.App.2d 1961), wherein the Bank had a chattel mortgage on a trailer, which mortgage was personal against the president and secretary (husband and wife) of the Dealer Corporation. The trailer had been purchased by the Coles, individually, from their own dealer company, Cole Mobile Homes, Inc., and the chattel mortgage on the trailer was given ,by the Coles directly to the appellant Bank. This was an only single transaction with the Bank.

In the case sub judice, we have a different set of facts. The appellant held a floor plan mortgage on all of the trailers of Quality Mobile Homes, Inc., the retail dealer, and in addition thereto, after the first sale of the trailer in question by Quality, the appellant held the retain title contract against the first purchaser. After default, the appellant demanded that Quality repossess the trailer, which was done and the same placed on the retail sales lot of Quality, along with other trailers held for retail sale. After the second sale by *20Quality (to the defendants), the appellant noticed, several months after the sale to the defendants, that the trailer was no longer on the lot, and demanded immediate payment therefor from Quality. — not from the appellees.

It is my opinion that the facts in the case sub judice throw this case within the rule of law laid down by the Supreme Court of Florida in the case of Motor Credit Corporation v. Woolverton, 99 So.2d 286 (Fla.1957), wherein the Supreme Court cited with approval Glass v. Continental Guaranty Corp., 81 Fla. 687, 88 So. 876, 25 A.L.R. 312 wherein we find this expression: “Where one of two innocent parties must suffer through the act or negligence of a third person, the loss should fall upon the one who by his conduct created the circumstances which enabled the third party to perpetrate the wrong or cause the loss.”

Also, in disposing of the question of F.S. Section 319.22, F.S.A. (the title recording law), the court in Woolverton cited with approval Fogle v. General Credit, 1941, 74 App.D.C. 208, 122 F.2d 45, 49, 136 A.L.R. 814, wherein we find this language:

> “ ‘But the statute is a bulwark, not a trap. The mortgagee is favored so long as he acts consistently with the statutory conditions. But when he goes further and either by his conduct prevents the purchaser from making the usual investigation or takes advantage of circumstances which he knows *or reasonably should know would have this effect, he destroys the fotmdation upon which his own protection rests.*He cannot throw the purchaser off guard concerning the protection which the statute gives to him and take advantage at the same time of what otherwise would or might have been discovered. Thus, if the mortgagee clothes the mortgagor with the indicia of ownership, or gives him authority to sell the property, *or stands by in silence and watches the mortgagor deal with it as owner, he nullifies the effect of recording by his inconsistent representation.’*

(Emphasis supplied.)

It is my opinion that the appellant had so clothed Quality Mobile Homes, Inc., its floor planned dealer, with implied authority to sell the property that appellant had nullified the effect of the recording of title and liens as required by the statute.

The contention of appellant that it had not authorized its dealer, Quality, to resell the trailer, is untenable in view of the fact that said trailer was placed on the sales lot and exposed to prospective purchasers without any “not for sale” or other indicia being shown to indicate to an unsuspecting public that said trailer was to be treated any differently from the other trailers. The fact that this was a used trailer, as distinguished from a new trailer, makes no difference when the same licensed dealer is offering both kinds for sale on the same lot.

For these reasons, I think the trial court was correct and the judgment appealed should be affirmed.