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COA: Tractor sale contract not enforceable

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The Indiana Court of Appeals says it’s against public policy to uphold any civil contract that’s based on an illegal action, and so the court says it won’t create a rule allowing that transaction agreement to be enforced.

An 18-page ruling came May 19 in James S. Tracy v. Steve Morell, et al., No. 59A01-1009-PL-488, affirming in part and reversing in part an Orange County judge’s decision about a tractor transaction where the identification number appears to have been illegally removed.

This case involves a fraud and counter-claim stemming from the 2002 sale of a used Ford Holland farm tractor with an altered identification number, which James Tracy agreed to buy for $12,500 and set up payments on. Tracy paid $8,500, but stopped making payments in 2003 and left about $4,000 outstanding. A few months after that, prosecutors charged Steve Morrell with four counts of receiving stolen tractors and farm equipment. Tracy learned of the situation and contacted the Orange County Sheriff’s Office to inform them of the tractor he’d purchased and had been paying on. Police inspected the tractor and found the ID number had been illegally altered, but after impounding it they closed that investigation because of prohibitive costs in determining who might have owned the tractor. Morrell pleaded guilty to the pending felony stolen property counts that also involved altered numbers, but it didn’t involve Tracy’s tractor.

That led to Tracy’s fraud allegations, and a counter-claim by Morrell that Tracy had defaulted on the promissory note the two had exchanged as part of the sale. Following a bench trial, Circuit Judge James Blanton dismissed Tracy’s complaint with prejudice for failing to meet his burden of proof on fraud and concluded that he owed Morrell $4,000 because it was an enforceable contract.

On appeal, the three-judge appellate panel determined enough evidence existed for the trial judge to rule on the merits and that there was no reason why he should have dismissed Tracy’s claim. Though Judge Blanton didn’t err when he held Tracy failed to meet his burden of proof on the fraud claim, the appellate court found that the contract is unenforceable because of a mutual mistake of fact between the parties and the contract violates public policy.

Specifically, the appeals judges looked to Indiana Code 35-43-4-2.3 that made it a crime to deal in altered property. Even though the state abandoned its attempt to prove that Morrell had stolen the specific tractor at issue here and Tracy didn’t prove to the trial court’s satisfaction that a crime had been committed or that there had been a violation of the Crime Victim’s Relief Act, the court said that doesn’t end the inquiry about whether this contract is enforceable.

“The tractor’s identification number was destroyed, and we can think of no lawful reason why the number was ground down, filled in with putty and painted over,” Judge Edward Najam wrote. “Rather, the only purpose for concealing the true identity of the tractor was to move the property outside the stream of lawful commerce into a secondary or ‘black market.’ We decline to adopt a rule that someone may sell altered property with impunity and then claim ignorance as a complete defense in a civil action from the sale. Such a rule would violate public policy because in the sale of personal property, unless otherwise agreed, the seller’s ownership free and clear of liens and encumbrances is presumed. Here, the tractor was encumbered by an altered identification number. Whether or not a crime occurred, and whether or not statutory relief is available under the Crime Victim’s Relief Act, the law should not permit a seller to transfer property with an altered identification number without being held accountable for it.”

The appellate court ordered that Tracy has no further obligation on the promissory note and he’s entitled to a rescission of the tractor sale contract and monetary judgment in the amount he’d paid with interest.

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  1. Applause, applause, applause ..... but, is this duty to serve the constitutional order not much more incumbent upon the State, whose only aim is to be pure and unadulterated justice, than defense counsel, who is also charged with gaining a result for a client? I agree both are responsible, but it seems to me that the government attorneys bear a burden much heavier than defense counsel .... "“I note, much as we did in Mechling v. State, 16 N.E.3d 1015 (Ind. Ct. App. 2014), trans. denied, that the attorneys representing the State and the defendant are both officers of the court and have a responsibility to correct any obvious errors at the time they are committed."

  2. Do I have to hire an attorney to get co-guardianship of my brother? My father has guardianship and my older sister was his co-guardian until this Dec 2014 when she passed and my father was me to go on as the co-guardian, but funds are limit and we need to get this process taken care of quickly as our fathers health isn't the greatest. So please advise me if there is anyway to do this our self or if it requires a lawyer? Thank you

  3. I have been on this program while on parole from 2011-2013. No person should be forced mentally to share private details of their personal life with total strangers. Also giving permission for a mental therapist to report to your parole agent that your not participating in group therapy because you don't have the financial mean to be in the group therapy. I was personally singled out and sent back three times for not having money and also sent back within the six month when you aren't to be sent according to state law. I will work to het this INSOMM's removed from this state. I also had twelve or thirteen parole agents with a fifteen month period. Thanks for your time.

  4. Our nation produces very few jurists of the caliber of Justice DOUGLAS and his peers these days. Here is that great civil libertarian, who recognized government as both a blessing and, when corrupted by ideological interests, a curse: "Once the investigator has only the conscience of government as a guide, the conscience can become ‘ravenous,’ as Cromwell, bent on destroying Thomas More, said in Bolt, A Man For All Seasons (1960), p. 120. The First Amendment mirrors many episodes where men, harried and harassed by government, sought refuge in their conscience, as these lines of Thomas More show: ‘MORE: And when we stand before God, and you are sent to Paradise for doing according to your conscience, *575 and I am damned for not doing according to mine, will you come with me, for fellowship? ‘CRANMER: So those of us whose names are there are damned, Sir Thomas? ‘MORE: I don't know, Your Grace. I have no window to look into another man's conscience. I condemn no one. ‘CRANMER: Then the matter is capable of question? ‘MORE: Certainly. ‘CRANMER: But that you owe obedience to your King is not capable of question. So weigh a doubt against a certainty—and sign. ‘MORE: Some men think the Earth is round, others think it flat; it is a matter capable of question. But if it is flat, will the King's command make it round? And if it is round, will the King's command flatten it? No, I will not sign.’ Id., pp. 132—133. DOUGLAS THEN WROTE: Where government is the Big Brother,11 privacy gives way to surveillance. **909 But our commitment is otherwise. *576 By the First Amendment we have staked our security on freedom to promote a multiplicity of ideas, to associate at will with kindred spirits, and to defy governmental intrusion into these precincts" Gibson v. Florida Legislative Investigation Comm., 372 U.S. 539, 574-76, 83 S. Ct. 889, 908-09, 9 L. Ed. 2d 929 (1963) Mr. Justice DOUGLAS, concurring. I write: Happy Memorial Day to all -- God please bless our fallen who lived and died to preserve constitutional governance in our wonderful series of Republics. And God open the eyes of those government officials who denounce the constitutions of these Republics by arbitrary actions arising out capricious motives.

  5. From back in the day before secularism got a stranglehold on Hoosier jurists comes this great excerpt via Indiana federal court judge Allan Sharp, dedicated to those many Indiana government attorneys (with whom I have dealt) who count the law as a mere tool, an optional tool that is not to be used when political correctness compels a more acceptable result than merely following the path that the law directs: ALLEN SHARP, District Judge. I. In a scene following a visit by Henry VIII to the home of Sir Thomas More, playwriter Robert Bolt puts the following words into the mouths of his characters: Margaret: Father, that man's bad. MORE: There is no law against that. ROPER: There is! God's law! MORE: Then God can arrest him. ROPER: Sophistication upon sophistication! MORE: No, sheer simplicity. The law, Roper, the law. I know what's legal not what's right. And I'll stick to what's legal. ROPER: Then you set man's law above God's! MORE: No, far below; but let me draw your attention to a fact I'm not God. The currents and eddies of right and wrong, which you find such plain sailing, I can't navigate. I'm no voyager. But in the thickets of law, oh, there I'm a forester. I doubt if there's a man alive who could follow me there, thank God... ALICE: (Exasperated, pointing after Rich) While you talk, he's gone! MORE: And go he should, if he was the Devil himself, until he broke the law! ROPER: So now you'd give the Devil benefit of law! MORE: Yes. What would you do? Cut a great road through the law to get after the Devil? ROPER: I'd cut down every law in England to do that! MORE: (Roused and excited) Oh? (Advances on Roper) And when the last law was down, and the Devil turned round on you where would you hide, Roper, the laws being flat? (He leaves *1257 him) This country's planted thick with laws from coast to coast man's laws, not God's and if you cut them down and you're just the man to do it d'you really think you would stand upright in the winds that would blow then? (Quietly) Yes, I'd give the Devil benefit of law, for my own safety's sake. ROPER: I have long suspected this; this is the golden calf; the law's your god. MORE: (Wearily) Oh, Roper, you're a fool, God's my god... (Rather bitterly) But I find him rather too (Very bitterly) subtle... I don't know where he is nor what he wants. ROPER: My God wants service, to the end and unremitting; nothing else! MORE: (Dryly) Are you sure that's God! He sounds like Moloch. But indeed it may be God And whoever hunts for me, Roper, God or Devil, will find me hiding in the thickets of the law! And I'll hide my daughter with me! Not hoist her up the mainmast of your seagoing principles! They put about too nimbly! (Exit More. They all look after him). Pgs. 65-67, A MAN FOR ALL SEASONS A Play in Two Acts, Robert Bolt, Random House, New York, 1960. Linley E. Pearson, Atty. Gen. of Indiana, Indianapolis, for defendants. Childs v. Duckworth, 509 F. Supp. 1254, 1256 (N.D. Ind. 1981) aff'd, 705 F.2d 915 (7th Cir. 1983)

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