Question

Used Car Problems. Marcy purchased a used car from ABC Motors. Six months later, the police seized the car from Marcy because it was a stolen vehicle. Marcy asked for her money back from ABC Motors. The manager there told her that the car was not stolen; that even if it were stolen, ABC Motors acted in good faith with no knowledge of a theft; therefore, no refund was legally required. ABC Motors had also sold a used car to Frank, who wrote a bad check for the car and left town but not before he sold the car to Betty, who paid a fair price for the car believing that Frank had all rights to sell it. ABC Motors asked Betty to return the car, but she told ABC to forget it. Assuming that ABC Motors was an innocent purchaser from the thief, which of the following is true regarding the manager's statement that Marcy is not due a refund?

A. The manager is correct, but only if ABC Motors can prove that it had never been charged with dealing in stolen merchandise.

B. The manager is correct, but only if ABC Motors can prove that none of its representatives were negligent in disregarding evidence of the theft at any time prior to its resale to Marcy.

C. The manager is correct.

D. The manager is incorrect, but only if Marcy can prove that she specifically asked if there was any problem with the car prior to her purchase and was affirmatively told that the title was good.

E. The manager is incorrect.

Answer 1

E. The manager is incorrect.

Step-by-step explanation:

Since the car was stolen, ABC Motors never had good title of it. A car comes with a title and before ABC bought it from someone it should have verified that the title was good. They are merchants and their normal job is to deal with this kind of things. A car dealership cannot sell cars without a good title, and if they do, they will get in legals problems for doing so.Their problems will not only involve the buyer, but they will also be investigated to check if they were involved in the theft.