“Let the buyer beware” recently took an unusual turn in Indiana. Maybe now it should read “Let the original buyer beware.”
Last week, we reported a story about federal prosecutors in Indianapolis, Ind., releasing details of a racket there that allegedly used mechanic’s liens to steal cars from banks and others who had ownership interest in the vehicles.
Prosecutors say a business known as Mechanic’s Liens Plus has been operating the scam in Indianapolis and they charged the owner of the business and his daughter, along with a Bureau of Motor Vehicles insider who helped with the scheme. Apparently, people would pay $1,000 to Mechanic’s Liens Plus to file fake paperwork to enforce a mechanic’s lien on cars, enabling the drivers to escape making payments that they owed on the cars.
One of those cases involved a 1965 Corvette that James N. and Stephanie L. Brinkley bought in 2005. A year later, they contracted with Michael Haluska to restore the car, but the two parties eventually had a falling-out over Haluska’s work and the amount of money they still owed him.
Haluska went on to hire Mechanic’s Liens Plus to file a lien on the Brinkleys’ Corvette. After sending a notice by certified mail (to James Brinkley’s father’s address) that warned the car would be sold at auction if charges of $7,400 were not paid by a specified date, Haluska in fact bought the car at auction for $100. He then posted the car on eBay Motors and sold it to a man named Donald Gindelberger for $25,100. Gindelberger, who did not review county records before the purchase, received a title with Haluska listed as the owner.
The Brinkleys had won a court injunction ordering Haluska not to transfer title or deliver the signed title to the vehicle to any third party but it proved to be to no avail. After the sale, they argued that Gindelberger was not “a bona fide purchaser for value without notice” because he had notice of their lawsuit against Haluska.
But the Indiana Court of Appeals rejected the Brinkleys’ argument and now has ruled that Gindelberger was indeed a good faith purchaser for value and will get to keep the car. The court said that Gindelberger was not required to search pending litigation records prior to purchasing a vehicle.
The Indiana Lawyer
[VIDEO] Family Looses 1965 Corvette In Mechanic’s Lien Scam
[VIDEO] Stolen 1989 Corvette Stored for 23 Years Sold on eBay
Settlement Announced in the Case of the 1966 Corvette with a Forged VIN