Court Opinion

ID: 9738474
Source: CourtListenerOpinion
Date Created: 2023-08-26 19:54:00.245028+00
Date Added: 2024-06-11T07:24:06.355961
License: Public Domain

Mr. PRESIDING JUSTICE GREEN, dissenting in part and concurring in part: I dissent from the decision of the majority affirming the summary judgment in favor of Huston in case No. 14428.1 concur in the reversal in case No. 14540 but would order that case remanded to the Secretary of State. I cannot agree with the majority that the evidence before the court upon the motion for summary judgment shows conclusively that Huston had no knowledge that an unperfected pin-chase money lien was outstanding as to the car in question when he paid the purchase price of the car to Wells and received possession of the vehicle and the assigned certificate of title. As the majority recite, Huston knew that Wells, a convicted criminal, was selling the car at *1500 to *2000 less than its blue book value. Although not a dealer, Huston was somewhat knowledgeable about the business of selling cars. The disputed testimony of Wells that he told Huston that the car was not paid for is also before the court. A trial court cannot properly make findings of fact upon a motion for summary judgment. The issue is whether the point is proved as a matter of law. I conclude that based upon the foregoing evidence, a trier of fact could find that Wells was telling the truth and that Huston realized that a person selling a car to a convicted criminal like Wells would be unlikely to do so on an unsecured note and that the reason that Wells was selling the car at such a substantial discount was to obtain cash for the car before the seller’s failure to perfect a lien was detected. If Huston’s knowledge was a material issue, summary judgment was erroneous. I further conclude that Huston’s knowledge was material. The parties do not dispute that Huber failed to comply with the provisions of section 3 — 202 of the Illinois Vehicle Code which would have perfected its security interest. Subsection (a) states that upon failure to do so, the security interest is “not valid” against “subsequent transferees.” Assuming arguendo, however, that, as the statute seems to state, knowledge of unperfected hens does not prevent a subsequent purchaser from being a subsequent transferee, we must examine the record to determine if Huston is shown to be a transferee. The requirements for transfer of the ownership of a motor vehicle to or from one not a dealer are set forth in section 3 — 112 of the Code. Subsection (b) states that with exceptions not applicable here, a “transferee” shall, “promptly and within fifteen (15) days after delivery of the vehicle and the assigned title, execute the application for a new certificate of title” and mail or deliver the application to the Secretary of State. Subsection (e) states that, with exceptions also inapplicable, except “as between the parties, a transfer by an owner is not effective until the provision of this section * 0 * have been complied with.” The parties do not dispute that Huston made no application for new certificate of title within the 15 days required by subsection (b) and in fact did not make the application for two months after receiving the car and the certificate of title from Wells. By the time Huston made application, the replevin suit had been filed and Huber had made demand on him for the car. I agree with the majority that Huston’s failure to follow the requirements of subsection (b) was not of itself sufficient grounds for the Secretary of State to revoke the certificate of title issued to him. However, the section clearly indicates that the failure to comply with its requirements works a detriment to the violator. That detriment is that because the transfer is not complete as to third persons while the purchaser is in violation, that purchaser does not have the status of a transferee during that time. The purpose of subsection (e) would be largely nullified if the noncomplying purchaser could wait until a third party sues and then comply. For this reason, I would rule that Huston was not entitled to the protection against unperfected liens given by section 3 — 202(a). The Illinois Vehicle Code is silent as to the rights of a party not having the status of a transferee but who has given value for a vehicle with knowledge of a prior unperfected lien. Under these circumstances, the provisions of article 9 of the Uniform Commercial Code (Ill. Rev. Stat. 1975, ch. 26, par. 9 — 101 et seq.) control. (South Division Credit Union v. Deluxe Motors, Inc. (1976), 42 Ill. App. 3d 219, 355 N.E.2d 715.) Under section 9 — 301(l)(c) of the Uniform Commercial Code, a buyer of an automobile other than in the ordinary course of business, as here, takes free of unperfected security interest only if the purchaser is without knowledge of the unperfected interest. Accordingly, I consider the question of whether Huston knew of the unperfected hen of Huber to be a material question of fact in the case. Because the evidence upon that fact was disputed, I would reverse the summary judgment and remand for further proceedings. Although I agree that Huston’s violation of section 3 — 112(b) of the Illinois Vehicle Code was of itself insufficient cause to revoke the certificate of title issued to him, I would remand that proceeding to the Secretary of State. A certificate of title may also be revoked if it was erroneously issued. (Ill. Rev. Stat. 1975, ch. 95M, par. 3 — 704(1).) Therefore, I would direct that the proceeding abide final determination in the replevin case and that if Huber recovers, the certificate of title be revoked but that otherwise the petition be denied.