ILNews

Car dealer responsible for buyer’s unauthorized purchases at auction

Back to TopCommentsE-mailPrintBookmark and Share

After finding that a trial court did not err in reinstating an action after initially dismissing it with prejudice, the Indiana Court of Appeals affirmed summary judgment in favor of Automotive Finance Corp. on its action seeking repayment of loans made to purchase cars.

Robert Souza, principal of Somerville Auto Transport Service Inc. in Somerville, Mass., executed a loan agreement with AFC in which the dealer could request advances against a line of credit to finance its purchase of vehicles for resale. Souza later authorized Robson Merenciano to buy and sell cars for Somerville and to execute company checks or drafts with AFC.

A year later, Souza revoked Merenciano’s privileges and did not timely repay AFC for the amounts it advanced to Merenciano to buy 15 cars. AFC sued Souza and the dealership to recover the loan amounts.

Marion Superior Judge Michael Keele told the parties that the cause would be dismissed under Trial Rule 41(E) at a hearing June 27, 2011, unless sufficient cause was shown. But a hearing wasn’t held because court staff mistakenly told the judge that AFC’s attorney did not show up for the hearing. The next day, Keele dismissed the case with prejudice. But a week later, Keele reinstated the action after learning the AFC attorney was present the day of the hearing. AFC later won summary judgment and more than $200,000 for the principal loan amount, pre-judgment interest, and attorney fees.

The parties disputed whether Keele could even put the action back on the docket after dismissing it with prejudiced. Somerville claimed AFC had to file a Trial Rule 60(B) motion to get the case back on the docket, which it did not; AFC argued that Trial Rule 41(F) does not limit a court’s authority to take corrective action under Trial Rule 60(A) as well as the failure to hold a hearing under Trial Rule 41(E) rendered the dismissal order void.

Based on the circumstances of this case and in light of the requirements of the rule as interpreted by the courts, the trial court was required to hold a hearing under T.R. 41(E) prior to dismissing the cause of action, wrote Judge Elaine Brown in Somerville Auto Transport Service, Inc. and Robert Souza v. Automotive Finance Corporation, 49A02-1307-CC-559. The COA agreed with the judge that the dismissal entry was erroneous.

“We observe that, while the dismissal order here is not the result of a typographical error and involves a dismissal which, as Somerville notes, was an appealable order, we note that Trial Rule 60(A) by its terms does not preclude a trial court from correcting mistaken orders which are appealable orders. While the court’s mistake in this case — believing the parties did not appear to present arguments at the June 27, 2011 hearing — was not a fact expressly stated in the order of dismissal, the record shows and the trial court found that the order was based solely upon the court’s mistake or oversight. We find that the court’s mistaken belief, where the parties suggested in their filings and briefs that the mistake was the result of an oversight or a miscommunication between or actions taken by members of the court’s staff, is more akin to a mechanical mistake than a substantive mistake in character.”

The judges also upheld summary judgment in favor of AFC because it demonstrated that it reasonably believed Merenciano was an agent of Somerville for the purpose of purchasing vehicles using the line of credit or financing made available to Somerville by AFC pursuant to the agreement.
 

ADVERTISEMENT

Post a comment to this story

COMMENTS POLICY
We reserve the right to remove any post that we feel is obscene, profane, vulgar, racist, sexually explicit, abusive, or hateful.
 
You are legally responsible for what you post and your anonymity is not guaranteed.
 
Posts that insult, defame, threaten, harass or abuse other readers or people mentioned in Indiana Lawyer editorial content are also subject to removal. Please respect the privacy of individuals and refrain from posting personal information.
 
No solicitations, spamming or advertisements are allowed. Readers may post links to other informational websites that are relevant to the topic at hand, but please do not link to objectionable material.
 
We may remove messages that are unrelated to the topic, encourage illegal activity, use all capital letters or are unreadable.
 

Messages that are flagged by readers as objectionable will be reviewed and may or may not be removed. Please do not flag a post simply because you disagree with it.

Sponsored by
ADVERTISEMENT
Subscribe to Indiana Lawyer
  1. Indianapolis employers harassment among minorities AFRICAN Americans needs to be discussed the metro Indianapolis area is horrible when it comes to harassing African American employees especially in the local healthcare facilities. Racially profiling in the workplace is an major issue. Please make it better because I'm many civil rights leaders would come here and justify that Indiana is a state the WORKS only applies to Caucasian Americans especially in Hamilton county. Indiana targets African Americans in the workplace so when governor pence is trying to convince people to vote for him this would be awesome publicity for the Presidency Elections.

  2. Wishing Mary Willis only God's best, and superhuman strength, as she attempts to right a ship that too often strays far off course. May she never suffer this personal affect, as some do who attempt to change a broken system: https://www.youtube.com/watch?v=QojajMsd2nE

  3. Indiana's seatbelt law is not punishable as a crime. It is an infraction. Apparently some of our Circuit judges have deemed settled law inapplicable if it fails to fit their litmus test of political correctness. Extrapolating to redefine terms of behavior in a violation of immigration law to the entire body of criminal law leaves a smorgasbord of opportunity for judicial mischief.

  4. I wonder if $10 diversions for failure to wear seat belts are considered moral turpitude in federal immigration law like they are under Indiana law? Anyone know?

  5. What a fine article, thank you! I can testify firsthand and by detailed legal reports (at end of this note) as to the dire consequences of rejecting this truth from the fine article above: "The inclusion and expansion of this right [to jury] in Indiana’s Constitution is a clear reflection of our state’s intention to emphasize the importance of every Hoosier’s right to make their case in front of a jury of their peers." Over $20? Every Hoosier? Well then how about when your very vocation is on the line? How about instead of a jury of peers, one faces a bevy of political appointees, mini-czars, who care less about due process of the law than the real czars did? Instead of trial by jury, trial by ideological ordeal run by Orwellian agents? Well that is built into more than a few administrative law committees of the Ind S.Ct., and it is now being weaponized, as is revealed in articles posted at this ezine, to root out post moderns heresies like refusal to stand and pledge allegiance to all things politically correct. My career was burned at the stake for not so saluting, but I think I was just one of the early logs. Due, at least in part, to the removal of the jury from bar admission and bar discipline cases, many more fires will soon be lit. Perhaps one awaits you, dear heretic? Oh, at that Ind. article 12 plank about a remedy at law for every damage done ... ah, well, the founders evidently meant only for those damages done not by the government itself, rabid statists that they were. (Yes, that was sarcasm.) My written reports available here: Denied petition for cert (this time around): http://tinyurl.com/zdmawmw Denied petition for cert (from the 2009 denial and five year banishment): http://tinyurl.com/zcypybh Related, not written by me: Amicus brief: http://tinyurl.com/hvh7qgp

ADVERTISEMENT