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Indiana justices answer certified question from federal court

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The Indiana Supreme Court says that a person or business that buys and later sells a wrecked vehicle must apply for a salvage title as required by state law, even if that vehicle’s been sold by the time that certificate is received.

Taking up the case of Larry D. Storie v. Randy’s Auto Sales LLC v. St. Paul Mercury Insurance Company, No. 94S00-0912-CQ-559, justices turned to an issue that came up through a certified question by the 7th Circuit Court of Appeals that handled a civil action out of Indianapolis in Storie v. Randy’s Auto Sales, LLC, 589 F.3d 873, 881 (7th Cir. 2009).

Storie bought a truck that had been involved in a fatal accident in 2003. The truck’s insurer, St. Paul Mercury Insurance Co., applied for a title as proof of ownership but didn't apply for a salvage title. The truck was sold several times - including by Randy's in Indiana - before St. Paul finally received the title. When Storie learned the truck was involved in the fatal accident and felt he’d been misled about the history, he sued Randy's in federal court in the Southern District of Indiana for failing to apply for a salvage title as required by Indiana Code §9-22-3-11(e).

In February 2009, U.S. District Court Judge William T. Lawrence from Indianapolis granted summary judgment in favor of Randy’s Auto Sales, but the 7th Circuit found the case hinged on the interpretation of how state law applies to Storie’s claim on the salvage title.

In analyzing the case, Indiana’s justices noted the specific focus of the certified question is whether ongoing ownership is required by the statute; they didn’t determine whether the phrase “any other person” in the law applies to auto dealers or whether dealers can rely on insurance companies as gatekeepers – both issues the federal appeals court already ruled on and rejected. Justices analyzed the law’s language to determine that the question’s answer is affirmative.

“While acknowledging that Indiana Code §9-22-3-11 is not free from ambiguity, we find persuasive the legislature’s use of ‘acquiring’ rather than ‘owning,’ the 31 day grace period within which to apply for a certificate of salvage title after receiving the original certificate of title, and the harmful consequences that could result if ‘acquiring’ were construed to mean ‘owning’,” Justice Brent Dickson wrote for the unanimous court. “That is, an entity that purchases and later sells a wrecked vehicle is required to apply for a salvage title under Indiana Code §9-22-3-11(e), even if it no longer continues to own the vehicle when it receives the certificate of title. The relinquishment of ownership of the salvage vehicle does not extinguish the obligation to apply for a salvage title.”

 

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