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It is always difficult when cars are stolen. Who ends up with the vehicle is heavily dependent on the facts of each case. The legal situation can be complex and any advice will need to be tailored to any one particular situation. However, there are a number of general rules that can help to simplify the problem.
Is the vehicle stolen?
Where a vehicle is taken without the permission of the owner then the thief will have no legal title to the vehicle despite having possession of it. With a few exceptions you cannot receive a better title than the person selling you the vehicle. Therefore you have no title to the vehicle and will lose it. If you have already sold the vehicle you will have to reimburse the buyer any funds paid and you will be liable to compensation for any losses.
What about Fraud?
Fraud is something different. Where the owner of a car intends to sell a vehicle and pass legal title but the payment details used are fraudulent then title to the vehicle will pass to the ‘fraudster’ unless and until the true owner takes steps to cancel the contract, e.g. by reporting it to the police etc… If you buy the vehicle during this period for a fair price and without knowledge of any fraud, then you will gain legal title to the vehicle even after the fraud is discovered. You will not have to return the car. You will also pass title to any subsequent owner should you have sold it.
The best option however remains to avoid the situation where possible. If the vehicle has recently changed owners you should satisfy yourself why it is now being sold. Also where possible sufficient identification details should be kept so that you can satisfy yourself of the identity of the person selling the car, their address and that this corresponds to the banking details and the registered owner’s details.
Don’t forget, this advice is general in nature and will need to be tailored to any one particular situation. As an RMI member you have access to the RMI Legal advice line, as well as a number of industry experts for your assistance. Should you find yourself in the situation above, contact us at any stage for advice and assistance as appropriate.
Motor Industry Legal Services
Motor Industry Legal Services (MILS Solicitors) provides fully comprehensive legal advice and representation to UK motor retailers for one annual fee. It is the only law firm in the UK which specialises in motor law and motor trade law. MILS currently advises over 1,000 individual businesses within the sector as well as the Retail Motor Industry Federation (RMI) and its members.