Fourth Court of Appeals

San Antonio, Texas

MEMORANDUM OPINION

No. 04-15-00544-CV

Juan J. VILLARREAL,

Appellant

v.

Roberto JIMENEZ,

Appellee

From the 218th Judicial District Court, Frio County, Texas

Trial Court No. 12-10-00348CVF

Honorable Donna S. Rayes, Judge Presiding

Opinion by: Karen Angelini, Justice

Sitting: Karen Angelini, Justice

Rebeca C. Martinez, Justice

Patricia O. Alvarez, Justice

Delivered and Filed: July 6, 2016

AFFIRMED

Juan J. Villarreal appeals the trial court’s judgment setting aside the transfer of a motor 

vehicle to him by Camilo Mendez and declaring the certificate of title issued to him to be void. 

Villarreal contends he was a bona fide purchaser for value and the Uniform Commercial Code 

governed the validity of his purchase of the vehicle as opposed to the Texas Certificate of Title 

Act. We affirm the trial court’s judgment.1

 1 On September 25, 2015, appellee Roberto Jimenez filed a motion to dismiss this appeal for lack of jurisdiction 

asserting Villarreal’s notice of appeal was untimely filed. By order dated December 4, 2015, this court denied 

Jimenez’s motion, holding Villarreal’s premature motion for reconsideration extended the appellate timetable. In his 
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BACKGROUND

On October 9, 2012, appellee Roberto Jimenez sued Villarreal and Mendez. Jimenez sued 

Mendez both individually and doing business as Camilo Mendez Auto Body and Paint. Jimenez 

asserted claims for fraud, conversion, and gross negligence. A bench trial was held on April 9, 

2015.

Mendez is in the business of painting motor vehicles. Jimenez and Mendez entered into a 

verbal agreement that Mendez would paint Jimenez’s 1973 Chevrolet Corvette in exchange for a 

motorcycle. The testimony of Jimenez and Mendez was conflicting as to whether Mendez took 

the Corvette and motorcycle with him or whether Jimenez subsequently dropped them off at 

Mendez’s shop. The evidence was also conflicting regarding the initial date the Corvette was at 

Mendez’s shop to begin painting. Jimenez testified Mendez took the Corvette and motorcycle to 

his shop in May or June of 2011. Mendez testified Jimenez brought the Corvette and motorcycle 

to his shop at the beginning of 2011; however, Mendez subsequently filed a mechanic’s lien stating 

the Corvette was first presented for painting on August 8, 2011 which conflicts with Mendez’s 

testimony that, by November of 2011, the Corvette had been at his shop for eight months. The 

August 8, 2011 date also appears on a purchase order detailing the work Mendez agreed to perform.

The evidence also was conflicting regarding the date Mendez completed painting the 

Corvette. Jimenez testified he never received notice that the paint job was complete until he 

received a notice of Mendez’s intention to file a mechanic’s lien dated November 14, 2011. 

Mendez testified he called Jimenez on numerous occasions after the paint job was complete; 

however, Jimenez started avoiding his phone calls. Although Mendez was in possession of the 

 

brief filed on February 29, 2016, Jimenez again contends this court lacks jurisdiction to consider this appeal because 

Villarreal’s prematurely filed motion for reconsideration did not extend the appellate deadlines. As this court held in 

our prior order, however, a prematurely filed motion for reconsideration extends the appellate timetable. Padilla v. 

LaFrance, 907 S.W.2d 454, 458-59 (Tex. 1995). Accordingly, we have jurisdiction to consider this appeal.
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motorcycle he was to receive in exchange for the paint job, Jimenez had not provided him with 

title to the motorcycle. Mendez testified the paint job was completed by August of 2011; however, 

the mechanic’s lien Mendez filed stated the work was completed on October 15, 2011.

Jimenez testified when he received Mendez’s notice of intention to file mechanic’s lien, he 

went to the bank and obtained a cashier’s check in the amount of $1,500.2

 Jimenez testified this 

was the amount Mendez initially quoted for painting the Corvette before they agreed to exchange 

the paint job for the motorcycle. On November 21, 2011, Jimenez filed a claim in the justice court 

stating Mendez had his Corvette and two motorcycles (a 2001 Harley Davidson and a 1986 

Kawasaki Voyager). Jimenez’s petition further stated Mendez had “gone back on [their] original 

agreement” and now wanted $3,500 for the paint job. Mendez was served with the petition on 

November 29, 2011, and filed an answer. On December 16, 2011, the justice court sent notice of 

a hearing set for December 29, 2011.

On December 15, 2011, Mendez filed a mechanic’s lien. As previously noted, the 

mechanic’s lien stated Mendez received the Corvette on August 8, 2011 and completed the work 

on October 15, 2011. The mechanic’s lien also stated the amount due was $3,500.00. Finally, the 

mechanic’s lien stated a public sale was conducted on December 15, 2011. That same day, Mendez 

obtained a loan from a bank in the amount of $2,534.34, giving the bank a security interest in the 

Corvette, and also applied for a certificate of title for the Corvette noting the bank’s lien. The 

Texas Department of Motor Vehicles (“Department”) issued Mendez a certificate of title on 

December 27, 2011.

With regard to the purported public sale, Jimenez stated he never received notice of such a 

sale. In his testimony, Mendez also admitted no public sale occurred.

 2 A copy of the certified check was introduced as evidence.
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On December 29, 2011, Jimenez and Mendez appeared before the justice court for the 

hearing. At the hearing, the judge noted the parties agreed Mendez would return the Corvette upon 

receipt of a signed title to the Harley Davidson motorcycle. The judge reset the case for January 

10, 2012. Mendez did not appear on the reset date, and the justice court rendered a default 

judgment ordering that Jimenez recover the Corvette and both motorcycles from Mendez in 

addition to court costs. A writ of execution was issued on March 9, 2012. The writ was executed 

on March 26, 2012, and the constable was able to recover the two motorcycles; however, one or 

both motorcycles had been taken apart. The constable’s return stated the Corvette had been sold 

and attached a title application receipt dated January 20, 2012, transferring title to the Corvette 

from Mendez to Villarreal.

Juan Villarreal testified he paid Mendez $5,000 cash for the Corvette. Villarreal stated he 

paid $3,500 for the Corvette, plus an additional $1,500 for Mendez to repaint the car. Villarreal 

owned a business in the same complex as Mendez’s shop. Villarreal testified he had subsequently 

spent approximately $7,000 in additional repairs to the Corvette, including purchasing new tires 

and paying for brake work. Villarreal only produced approximately $1,000 in receipts, however, 

which did not include any receipts for new tires or brake work.

Mendez testified Villarreal paid him $3,500 cash for the Corvette but no additional amount 

to repaint the car.3

 Mendez was shown the application he and Villarreal signed to transfer the title 

which stated the sales price was $1,000. Mendez could not explain the reason the application 

showed only $1,000 as the payment. Mendez admitted he already had title in his name at the time 

of the hearing before the justice court. Mendez further admitted when the constable arrived to 

execute the writ, the Corvette was still in Mendez’s shop.

 3 Mendez and his attorney did not arrive at the hearing until after Jimenez and Villarreal testified.
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At the conclusion of the testimony and closing arguments, the trial court announced its 

ruling as follows:

THE COURT: Res judicata was not pled, so that’s not available for me to 

rule upon. Nor did Mr. Mendez file any sort of counterclaim against Mr. Jimenez 

for unjust enrichment or quantum meruit, so I’m left without the ability to rule upon 

that. Nor did Mr. Villarreal file any sort of cross-claim against Mr. Mendez for the 

value or for what he expended in the event that he’s not awarded the Corvette. So 

all I’m really left with is who gets the Corvette. This case is not governed by the 

Business and Commerce Code. This case is governed by the Transportation Code 

and the Property Code. Looking at 501.074 of the Transportation Code it gives us 

guidance about how transfer of a vehicle by operation of law occurs and then you 

go to the Property Code for the mechanic’s lien provisions as to how to perfect that 

and to obtain your title by operation of law. Then if you look at the face of the 

mechanic’s lien, Plaintiff’s Exhibit 1I, you see the defects; a number of defects that 

exist. One defect is that it claims to be a public sale, and we have Mr. Mendez 

categorically saying it was not a public sale. Also, there is a requirement that a 

work order, a signed work order must be submitted, and there is, I guess, a work 

order that was prepared by Mr. Mendez but it’s not signed by Mr. [Jimenez] and in 

the absence of that there’s a requirement that there be a court order establishing 

ownership. Also, the statutory lienholder, it’s not even an affidavit because he 

didn’t — there’s no indication that it was sworn to. There may be more but then 

you look to 501.073 which says that if this Chapter is not complied with, being 

Chapter Five of the Transportation Code, then any sale is void. So this is a void 

sale that occurred to Mr. Villarreal, and I’m ordering that the documents and titles 

executed by Defendant Mendez, both to himself and to Defendant Villarreal are 

void and are of no effect and that ownership of the Corvette is established in the 

Plaintiff Mr. Jimenez.

The trial court subsequently signed a Judgment and Decree Setting Aside Certificates. In 

the judgment, the trial court finds Mendez “purportedly sold the vehicle to himself without proper 

compliance with the Texas Transportation Code, Chapter 501, and section 70.005 and 70.006 of 

the Texas Property Code.” The judgment declares the transfers of the Corvette to Mendez and to 

Villarreal to be void. The judgment further declares the certificates of title issued to Mendez and 

Villarreal to be void. Finally, the judgment orders Villarreal to deliver possession of the Corvette 

to Jimenez.4

 Villarreal appeals.

 4 In his brief, Jimenez asserts a waiver argument based on Villarreal’s failure to present an issue challenging the 

sufficiency of the evidence as it relates to the elements of the claims Jimenez asserted in his petition. However, the 
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DISCUSSION

In his second issue, Villarreal contends the trial court erred in concluding the Texas 

Certificate of Title Act (“Act”) governed the dispute instead of the Uniform Commercial Code 

which is codified in the Texas Business and Commerce Code (“Code”). As support for this 

contention, Villarreal cites section 501.005 of the Act which generally provides, “Chapters 1-9, 

Business & Commerce Code, control over a conflicting provision of this chapter.” TEX. TRANSP.

CODE ANN. § 501.005 (West 2013). Villarreal also cites a few cases in which courts have held the 

Code governed over the Act under the facts presented in those cases. See Vibbert v. PAR, Inc.,

224 S.W.3d 317, 324 (Tex. App.—El Paso 2006, no pet.) (holding section 2.401(b) of the Code 

trumps over sections 501.071(a) and 501.073 of the Act regarding when and how title transfers); 

First Nat’l Bank of El Campo, Tex. v. Buss, 143 S.W.3d 915, 922-24 (Tex. App.—Corpus Christi 

2004, pet. denied) (holding Code provisions control in “a priority dispute between a floor-plan 

financier and individuals claiming to be buyers in the ordinary course”).5

 Villarreal does not, 

however, discuss the specific provision of the Act referenced by the trial judge in announcing her 

ruling.

Under the facts of this case, Mendez asserted a statutory mechanic’s lien against the 

Corvette. Such a lien is governed by Chapter 70 of the Texas Property Code. See TEX. PROP.

CODE ANN. § 70.001(a) (West Supp. 2015) (providing for a possessory lien in favor of a worker 

who by labor repairs a vehicle). Section 70.006 of the Property Code requires a holder of a 

possessory mechanic’s lien on a motor vehicle subject to Chapter 501 of the Act to: (1) give written 

 

trial court did not base its judgment on the sufficiency of the evidence as it related to Jimenez’s claims. Instead, the 

trial court’s judgment was based on the Texas Certificate of Title Act and the validity of title. Because Villarreal 

presents issues challenging the basis for the trial court’s judgment, we reject Jimenez’s waiver argument. 5 We note a buyer in the ordinary course must purchase from a person “in the business of selling goods of that kind.” 

TEX. BUS. & COM. CODE ANN. § 1.201(9) (West Supp. 2015). In this case, Mendez is not in the business of selling 

motor vehicles.
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notice to the owner of the vehicle which notice is required to include a signed copy of the work 

order authorizing the repairs on the vehicle; and (2) file a copy of the notice and all information 

required by section 70.006 with the county tax assessor-collector’s office not later than the 30th

day after the date on which the charges accrued. Id. at § 70.006(a), (b-1)(4). After the owner 

receives notice, the owner has the right to obtain possession of the motor vehicle by paying the 

charges due to the holder of the lien before the 31st day after the date a copy of the notice is filed 

with the county tax-assessor collector’s office. Id. at § 70.006(e). If the charges are not paid by 

the 31st day, the lienholder is entitled to sell the motor vehicle at a public sale and apply the 

proceeds to the charges. Id. at 70.006(f). 

Once the foregoing foreclosure process has occurred under section 70.006 of the Property 

Code, section 501.074(c) of the Act governs the issuance of new title. See TEX. TRANSP. CODE 

ANN. § 501.074(c) (West 2013). Section 501.074(c) provides, in pertinent part, as follows:

(c) If a constitutional or statutory lien is foreclosed, the department may 

issue a new title in the name of the purchaser at the foreclosure on receiving:

(1) the affidavit of the lienholder of the fact of the creation of the lien and 

of the divestiture of title according to law; and

(2) proof of notice as required by Sections 70.004 and 70.006, Property 

Code, ....

Importantly, for purposes of resolving the issue presented in this appeal, section 501.074(d) of the 

Act provides, “Notwithstanding the terms of Section 501.005, in the event of a conflict between 

this section and other law, this section controls.” Id. at § 501.074(d).

As the trial court noted in its verbal ruling, the evidence established that Mendez failed to 

comply with section 70.006 in numerous respects. First, the notice Mendez sent to Jimenez did 

not include a signed copy of the work order authorizing the work on the Corvette. See TEX. PROP.

CODE ANN. § 70.001(b-1)(4) (West Supp. 2015). Second, although Mendez filed a mechanic’s 

lien with the county tax assessor-collector’s office, the record does not establish Mendez filed a 
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copy of the notice he provided to Jimenez. Id. at § 70.006(a). Third, Mendez was required to file 

the notice with the county tax assessor-collector’s office not later than the 30th day after the 

charges accrued; however, the mechanic’s lien, which was filed on December 15, 2011, stated the 

work was completed on October 15, 2011, which was inconsistent with Mendez’s testimony that 

the work was completed in August of 2011. Id. Regardless of whether the work was completed 

in August of 2011 or on October 15, 2011, the mechanic’s lien was not filed within thirty days of 

those dates. Finally, the foreclosure had to be by public sale, but Mendez admitted no public sale 

occurred. Id. at § 70.006(f).

With regard to the certificate of title, therefore, Mendez’s statutory lien was not properly 

foreclosed; therefore, the Department could not issue title in his name as the purchaser at a public 

foreclosure sale. See TEX. TRANSP. CODE ANN. § 501.074(c) (West 2013). In addition, the record 

does not contain an affidavit from Mendez as required by section 501.074(c) of the Act. Id. 

Finally, the record does not establish Mendez provided the Department with proof of the notice 

required by section 70.006. Id. Accordingly, because Mendez failed to comply with the 

requirements of section 501.074(c), Mendez’s certificate of title was void. See id. at § 501.073 

(“A sale made in violation of this chapter is void and title may not pass until the requirements of 

this chapter are satisfied.”). And, since Mendez possessed only void title, even under the Uniform 

Commercial Code, he could only transfer void title to Villarreal because section 2.403(a) of the 

Code only allows a person with voidable title to transfer good title, not a person with void title.6

 

See Drake Ins. Co. v. King, 606 S.W.2d 812, 817 (Tex. 1980) (noting where seller’s attempted 

transfer of motor vehicle to purchaser was void, purchaser had no title to transfer to subsequent 

 6 For this reason, Villarreal’s argument that he was a bona fide purchaser for value in his first issue fails. Generally, 

a purchaser only acquires “all title which his transferor had or had power to transfer.” TEX. BUS. & COM. CODE ANN.

§ 2.403(a) (West 2009). Since Mendez only had void title, Villarreal only acquired void title. A bona fide purchaser 

for value can obtain good title from a seller with voidable title, but not from a seller with void title. Id.
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purchaser); NXCESS Motor Cars, Inc. v. JPMorgan Chase Bank, N.A., 317 S.W.3d 462, 470 (Tex. 

App.—Houston [1st Dist.] 2010, pet. denied) (holding where seller in chain of title only held void 

title, all subsequent purchasers also received void title); TEX. BUS. & COM. CODE ANN. § 2.403(a) 

(West 2009). Therefore, the Act and the Code do not contain any conflict in this regard; however, 

even if they did, the trial court would not have erred in concluding the Act controls because, as 

previously noted, section 501.074(d) of the Act states, “Notwithstanding the terms of Section 

501.005, in the event of a conflict between this section and other law, this section controls.” TEX.

TRANSP. CODE § 501.074(d).

CONCLUSION

The trial court’s judgment is affirmed.

Karen Angelini, Justice