Theseus’ Paradox – Rebodies, Replicas & Tampered Numbers; an Automotive Identity Crisis

November 16, 2016 · Posted in News · Comments Off on Theseus’ Paradox – Rebodies, Replicas & Tampered Numbers; an Automotive Identity Crisis 

Greek historian and writer, Plutarch posed a question, over two thousand years ago, that has continued to confound philosophers.  “If the ship on which Theseus sailed has been so heavily repaired and nearly every part replaced, is it still the same ship — and, if not, at what point did it stop being the same ship?”  This same question can be posed differently and more succinctly; if one has an ax and replaces the handle and the head does he still have the same ax

This parable clearly presents a paradox that we collectors, restorers and enthusiasts of vintage and antique vehicles can well relate to.  At what point do our “restorations” become replicas of what the original is thought to have looked like?

Let us look for a moment at a fairly straightforward restoration of an otherwise solid car.  If a few body panels are replaced and others repaired and the drivetrain and chassis is otherwise original I think we can all agree that we have simply restored or rehabilitated the car; the majority remaining untouched and original.

But take the situation where  you replace the body but not the frame.  What about the situation where the frame and the body have been replaced?  What about just the frame? Does the authenticity of the engine change your opinion?  At some point the original car ceases to exist; its identity is destroyed and the resultant vehicle is a replica of what the original may have looked like.  True, to even the trained eye, a complete replica may well be indistinguishable from the original but it is clearly not the original.

As illustrated above, Theseus’ paradox continues to confound us in our hobby.  Cars today are being restored using many reproduction parts and it is unfortunately not uncommon to find that many of the rare cars have had their bodies, frames or had major components such as engines, transmissions or interiors replaced.    Other concerns regarding rebodied vehicles can be found in the article Rebodied Cars … what to do?.

Additionally, the removal and replacement of VIN and serial numbers can create an equally sticky situation Many laws have been enacted to protect the integrity of the VIN.  Pursuant to 18 U.S.C. § 511, the alteration of a VIN, could be a federal criminal offense.  Further, pursuant to 18 U.S.C. § 2321 whoever buys, receives, possesses, or obtains control of, with intent to sell or otherwise dispose of, a motor vehicle or motor vehicle part, knowing that an identification number for such motor vehicle or part has been removed, obliterated, tampered with, or altered, could be fined or imprisoned for up to ten years.  Similarly, Pennsylvania’s statutes also address this matter.  Specifically, 18 Pa. C.S.A. § 7703 states that a person who alters, counterfeits, defaces, destroys, disguises, falsifies, forges, obliterates or removes a vehicle identification number with the intent to conceal or misrepresent the identity or prevent the identification of a motor vehicle or motor vehicle part commits a felony of the third degree and, upon conviction, shall be sentenced to imprisonment for not more than seven years or a fine of not more than $50,000, or both.  Further, and most concerning is that pursuant to 18 Pa. C.S.A. § 7704  any person who purchases, receives, disposes, sells, transfers or possesses a motor vehicle or motor vehicle part with knowledge that the vehicle identification number of the motor vehicle or motor vehicle part has been altered, counterfeited, defaced, destroyed, disguised, falsified, forged, obliterated or removed with the intent to conceal or misrepresent the identity or prevent the identification of a motor vehicle or motor vehicle part commits a felony of the third degree and, upon conviction, shall be sentenced to imprisonment for not more than seven years or a fine of not more than $50,000, or both.  Moreover consider, especially with the case of restamped engines that, in Pennsylvania, it is illegal knowingly buy, or sell an automotive part from which the manufacturer’s name plate, serial number or any other distinguishing number or identification mark has been removed, defaced, covered, altered or destroyed unless instructed or done by the manufacturer.  18 Pa.C.S.A. § 4104.

Often times Bryan W. Shook, Esquire, through his law firm Vintage Car Law, is contacted concerning misrepresentation of vehicles that have been rebodied or otherwise replicated to appear one way when they were not actually produced in that configuration.  There is well-settled Pennsylvania case law which holds that “the deliberate nondisclosure of a material fact is the same as culpable misrepresentation.  Even innocent misrepresentations are actionable if they relate to matters material to the transaction involved; while, if the misrepresentation is made knowingly … materiality is not a requisite to the action…. A misrepresentation is material when it is of such a character that if it had not been made, the agreement would not have been entered into.”  McClellan v. HMO of PA, 604 A.2d 1053, 1060 (citations omitted).

In closing, if the car has been substantially modified during the restoration (i.e. rebuilt using all non-original parts, a new body, frame, engine, etc. )this information must be disclosed prior to the sale of the vehicle to the new owner.  Failure to do so could create legal liability.  The use of half-truths and crafty expressions of terms could create even further liability.

Attorney Bryan W. Shook is not only a devoted automotive enthusiast, but is also an experience litigator who devotes a large portion of his law practice to helping other collectors and hobbyists understand today’s market and protect their automotive investments. Attorney Bryan W. Shook is a seasoned automotive collector and restorer and as such brings real world experience and firsthand knowledge to the table for his clients throughout the world. Although Bryan Shook is headquartered in  central Pennsylvania (close proximity to Carlisle and Hershey), Attorney Bryan Shook is available anywhere for consultation, advice, and information, most times, on as short as a day’s notice. If you’d like more information about this topic or would like to speak with Attorney Bryan W. Shook please email him at BShook@shooklegal or by phone at 717-884-9010.  More information can be found at Http://www.vintagecarlaw.com.

 

Judge Rules that disgruntled ex-wife can sell husband’s rare 1968 Camaro

October 26, 2015 · Posted in News, Uncategorized · Comments Off on Judge Rules that disgruntled ex-wife can sell husband’s rare 1968 Camaro 

Pottsville, Pennsylvania – Vintage Car Law and Bryan W. Shook, Esquire where recently successful in defending and proving the title to a rare 1968 Chevrolet Camaro Rally Sport.  Bryan W. Shook, Esquire acted as lead trial counsel to the buyer of the rare 1968 Camaro.  The buyer purchased the Camaro from the ex-wife of the last titled owner.  When the husband found out his Camaro had been sold he sought to get the car back.  Attorney Shook petitioned the Court of Common Pleas of Schuylkill County for an order declaring that his client was the sole lawful owner of the Camaro and to extinguish any claim the husband may have to the car.  The court ruled that the wife had the power to sell the car even though she did not have the Certificate of Title in her name.  The Court’s Opinion can be found here – Judge Rules that disgruntled ex-wife can sell husband’s 1968 Camaro.

Bryan W. Shook, Esquire is the principal of Vintage Car Law  Attorney Bryan Shook has helped hundreds of Pennsylvania residents properly title their antique and collector cars through petitioning the Courts.  If you would like information on how Attorney Shook can help you get a title to your antique or collector car please email him at bshook@shooklegal.com.

Importance of Choosing The Right Restoration Shop

May 7, 2014 · Posted in News · Comments Off on Importance of Choosing The Right Restoration Shop 

Recently we were reminded, by an Ohio Court of Appeals, of the importance of selecting the proper restoration shop when it comes time to have repairs made to your classic car. The case reminded us that restoration facilities are not always as they seem and not all are ethical, forthright and honest in their practices and actions.

The case of State of Ohio v. Keith Shellhouse, 2014-Ohio-1823 which was decided on April 23, 2014 is very illustrative of the need to vet the restoration shop you are considering before dropping off your car, parts and most importantly, money. In the aforementioned case, Keith Shellhouse owner of Independent Autobody and Pro Restorations in Richland County, Ohio, was found guilty by a jury and the Court of Appeals affirmed the jury’s verdict. The case reports that in one instance a 1967 Ford Mustang was brought to Shellhouse’s restoration shop in Richland County, Ohio for repair. Mr. Shellhouse, it was alleged, then sold the vehicle without the owner’s authorization to do so. Mr. Shellhouse sent notice of the sale to an address in Michigan when he knew that the owner resided in Florida. The appellate court also noted that multiple witnesses testified as to Mr. Shellhouses’s pattern of conduct of accepting cars for repair with their owners’ money and then failed to do the working, sometimes failing to even return the cars. Mr. Shellhouse was also found guilty of tampering with motor vehicle records, a felony of the third degree. Keith Shellhouse was sentenced to four years in jail for his actions.

When you are in searching for a restoration shop, do not go by advertisements and discussions with the shop alone. If you are considering sending your vehicle to a restoration shop the following items (at a minimum) should be considered:

  •  Visit the shop, in person (then visit another shop (or several) for comparisons)
  • Speak with customers of the shop (current and past) (if the shop won’t give out customer’s names to speak with that is an immediate red flag)
  • Demand a written restoration contract including a detailed scope of work, payment terms, set price or hourly estimates not to be exceeded without prior written change order authorizations signed by both the shop and you the owner. The contract should have a start date and a completion date. The contract should also require that the shop document the restoration with photographs (time-stamped, preferably) and provide them to you with written updates on a specific interval basis.

In the end having your car restored should be an enjoyable experience, not one wrought with fear that you will never see your car or money again. Most restoration shops are on the up and up and you will have nothing to worry about. Your best insurance however is a firm written car restoration contract.

Bryan W. Shook, Esquire is an attorney in Camp Hill, Pennsylvania who is not only a devoted automotive enthusiast, but is also an experience litigator who devotes a large portion of his law practice to helping collectors and hobbyists protect their automotive investments. Bryan Shook represents some of the most notable automotive restorers in the world and has been responsible for litigating and resolving some of the leading antique automobile cases in the United States. Attorney Shook is available to consult with you or your restoration shop concerning any aspect of automotive or Pennsylvania business law. If you own an old car restoration shop, are you in compliance with all of the consumer protection statutes, including the Pennsylvania Auto Industry Trade Regulations, the Lanham Act and the FTC regulations? If you have any questions regarding compliance or wish to have a restoration contract drafted or reviewed, please do not hesitate to contact Attorney Bryan W. Shook. Bryan Shook can be reached at his Office at 717-884-9010 or by email at bshook@shooklegal.com.

The Dirty Side of the Hobby – Fake Pedigree & Provenance

May 1, 2014 · Posted in News · Comments Off on The Dirty Side of the Hobby – Fake Pedigree & Provenance 

Forgeries and fakes have long been the scourge of the collector car hobby. This practice has continued thanks to many “entrepreneurs” who have established businesses selling “reproduction” tags and paperwork for older vehicles. Reproduction however would imply that it is a replica of the original but actually the term “reproduction” in this sense usually means counterfeit.

In the Corvette, Chevelle and Camaro market “aged” build sheets or tank sheets, made to order, to your specifications, have long been available. The number of counterfeiters who forge historical vehicle documents and paperwork is very concerning. Sham documents have been openly advertised for nearly two decades in Hemmings Motor News, eBay, Craigslist and on the internet. Some of this fake paperwork is so doctored that it actually smells old or in the case of Corvette tank sheets like gasoline. Of course if you interview any of the outfits that create these items you would quickly be told that they are novelty items. All too often, however, people are deceived by the very existence of this fake paperwork and lulled into a sense of security when viewing such a vehicle which may be for sale under the mistaken guise that it has pedigree and provenance, to wit, the counterfeit documentation.

An additional problem is that of “air cars” (cars created from “thin air” with nothing more than a VIN). With counterfeit documents, air cars are immediately given credence and pedigree. In additional to fake window stickers, build sheets, FMVSS stickers, Corvette Order Copy (“Tank Sticker”) there are also forgers out there that make new VIN tags, cowl tags, trim tags and others that offer the proper rivets or screws to affix the fake tags.

One method of outing some of the fakes in the hobby has been recently introduced.  A service of the National Corvette Restorer’s Society (NCRS) which tells owners when their cars were built and where they were delivered new has the potential for exposing several fraudulently presented classic Chevys. With the information provided by the NCRS, hobbyists will be able to verify their car’s paperwork, VIN number and cowl/trim tag to make sure that it all connects properly.

With the “birthday” of a car known, you can make sure that the VIN is consistent with that month of production and that the engine production stamping precedes the cars build date. Also with this information, you can determine if the assembly week code on the trim tag is consistent with the date given by the NCRS. Finally, if the vehicle has “paperwork” or a window sticker (or build sheet) the dealership should match that or be reasonably close in vicinity (e.g. same zone — dealer trades) to the dealership provided by the NCRS. If any of this information does not match or if the birthday of the car does not correlate to the VIN, engine stamping or cowl tag, then you have major problems. If the information does not match, it is wise to investigate the car carefully and, if necessary, hire and expert to examine the vehicle for signs of further molestation and restamping.

If you find that the vehicle you own is a clone or has doctored paperwork, a tampered VIN, restamped engine, transmission or replacement VIN tag, cowl tag or trim tag, you should immediately contact an attorney to learn about your legal rights and what recourse and options you may have.

 Attorney Bryan W. Shook is not only a devoted automotive enthusiast, but is also an experience litigator who devotes a large portion of his law practice to helping other collectors and hobbyists understand today’s market and protect their automotive investments. Attorney Bryan W. Shook is a seasoned automotive collector and restorer and as such brings real world experience and firsthand knowledge to the table for his clients throughout the world. Although Bryan Shook is headquartered in Camp Hill, Pennsylvania (close proximity to Carlisle and Hershey), Attorney Bryan Shook is available anywhere for consultation, advice, and information, most times, on as short as a day’s notice. If you’d like more information about this topic or would like to speak with Attorney Bryan W. Shook please email him at BShook@shooklegal.com or by phone at 717-884-9010.  More information can be found at Http://www.vintagecarlaw.com.

 

Collector Car Market Experiences Billion Dollar Growth over last 10 years

April 16, 2014 · Posted in News · Comments Off on Collector Car Market Experiences Billion Dollar Growth over last 10 years 

Choosing the Right Legal Counsel Makes All the Difference

The collector car insurance company Hagerty Insurance is reporting that the collector car auction business in the United States is now a billion dollar business.  Reports suggest that the total gross auction sales in 2013 eclipsed $1,300,000,000.00 ($1.3 Billion) according to Hagerty.  Hagerty comparatively notes that in 2004 the figure was around $282,000,000.00 ($282 Million).  This is a billion dollar growth in the United States collector car auction market in ten short years! As Hagerty and other news outlets note, this growth is not simply confined to the United States, but the world-wide collector car market has soared similarly over the same time-period.

With this type of unprecedented growth within the collector car market, hobbyists, collectors and car investors need to be more vigilant than ever to protect their investments and their collections.  The market is ripe for fraud, misrepresentations and other nefarious actions, including ownership disputes and estate or probate litigation.  If you, unfortunately, find yourself on the cusp of a dispute or hauled into court or other legal tribunal over the title, ownership, pedigree, provenance or history of an antique or classic car or collectible, you must be prepared to present your side of the story in an intelligible, persuasive and cogent manner.  You would be best served by employing an attorney who fully understands the issues you face and the collector car market and car auction industry.

The handling of a legal matter concerning an antique or collector car is markedly different than other types of legal matters.  In the collector car hobby there are “terms of art” (i.e. trim tag, restamp, NOS, NOM, matching numbers, etc.) that must be defined for the Court in order for your position to be argued effectively.  Furthermore, many times it will not simply be enough to define the term, but rather the term itself and its application to the facts of the case are what the case’s ultimate determination may turn upon.  This is where it pays to hire an attorney who not only “speaks your language” but also knows how the frauds are perpetrated and how to persuasively represent your position to the Court or Jury.

Ultimately, collectors must be hypervigilant in the current market and careful to employ the right legal counsel and other professionals with respect to their dealings, collections, and businesses.  The market is constantly changing, not only in its growth but also in its technicalities and breadth, a collector’s diligence is of paramount importance.

Bryan W. Shook, Esquire is an attorney in Camp Hill, Pennsylvania whose practice areas include vehicle fraud, dealership fraud, VIN matters, title fraud, VIN error, estate ownership questions and general collector car problem resolution.  Attorney Bryan W. Shook is not only a devoted automotive enthusiast, but is also an experience litigator who devotes a large portion of his law practice to helping other collectors and hobbyists understand today’s market and protect their automotive investments.

Attorney Bryan W. Shook is not only a devoted automotive enthusiast, but is also an experience litigator who devotes a large portion of his law practice to helping other collectors and hobbyists understand today’s market and protect their automotive investments. Attorney Bryan W. Shook is a seasoned automotive collector and restorer and as such brings real world experience and firsthand knowledge to the table for his clients throughout the world. Although Bryan Shook is headquartered in Camp Hill, Pennsylvania (close proximity to Carlisle and Hershey), Attorney Bryan Shook is available anywhere for consultation, advice, and information, most times, on as short as a day’s notice. If you’d like more information about this topic or would like to speak with Attorney Bryan W. Shook please email him at BShook@shooklegal.com or by phone at 717-884-9010.  More information can be found at Http://www.vintagecarlaw.com.

Benefits of Using an Attorney as an Escrow Agent to Protect Yourself in a Collector Car Sale or Transaction

January 28, 2013 · Posted in News · Comments Off on Benefits of Using an Attorney as an Escrow Agent to Protect Yourself in a Collector Car Sale or Transaction 

Benefits of using an attorney as an escrow agent to protect yourself in a collector car transaction

By: Bryan W. Shook, Esquire

Email: bshook@shooklegal.com

Using an attorney to act as an escrow agent is one of the most effective ways to safeguard yourself from the pitfalls of buying vehicles sight unseen from far away locations.  In a perfect world collector car transactions would all be “above board” and transparent however as we all know this, unfortunately is not always the case.  That screaming deal on eBay or Craigslist may be a great deal, but it may also be the biggest mistake you make this year.  There are many hazards upon which a prospective buyer may happen, although most happen with the consummation of the sale, especially if the vehicle is not viewed, in person, by the buyer. 

How can using an attorney as an escrow agent help protect you in a collector car transaction?

An attorney as an escrow agent has more inherent safeties as opposed to using a broker.   Attorneys are regulated by their state’s bar association or their state’s supreme court.  Brokers are usually not regulated at all and only subject to their state’s vehicle board, if regulated at all.  Money placed into an attorney’s escrow account is subject to strict accounting oversight and may only be paid out with the client’s consent and agreement. 

As an attorney familiar with the nuances and pitfalls of collector car transactions I can offer many safeguarding services, professionally, discreetly and unobtrusively to preserve the transaction and yet protect you the client throughout the sale.

I offer the following services:

  • Pre-Purchase Inspection Review
  • In-person auction assistance to both bidders and sellers
  • Escrow Agent
  • Sales Contract Drafting/Review
  • Private Treaty Sales (start to finish)
  • Independent evaluation of title documents prior to consummation of sale
  • Vehicle research, including verification of provenance and pedigree
  • Forensic investigatory services (number & stamp investigation, make and model investigation, production anomalies, etc.) 
  • Powers of Attorney
  • Import/Export
  • Competing Claims of Ownership
  • Title Defense
  • Help safeguard against misrepresentations and fraud

By utilizing my services, you are not only protecting yourself in the transaction, but you are also making a further investment in the value of your purchase. 

Bid with knowledge. Buy with confidence.

Attorney Bryan W. Shook is not only a devoted automotive enthusiast, but is also an experience litigator who devotes a large portion of his law practice to helping other collectors and hobbyists understand today’s market and protect their automotive investments. Attorney Bryan W. Shook is a seasoned automotive collector and restorer and as such brings real world experience and firsthand knowledge to the table for his clients throughout the world. Although Bryan Shook is headquartered in central Pennsylvania (close proximity to Carlisle and Hershey), Attorney Bryan Shook is available anywhere for consultation, advice, and information, most times, on as short as a day’s notice. If you’d like more information about this topic or would like to speak with Attorney Bryan W. Shook please email him at BShook@shooklegal.com or by phone at 717-884-9010  More information can be found at Http://www.vintagecarlaw.com.

Rebodied Cars … what to do …

June 29, 2012 · Posted in News · Comments Off on Rebodied Cars … what to do … 

Rebodies:
What’s the big deal???

(By: Bryan W. Shook, Esquire)

BShook@shooklegal.com

717-884-9010

I’ve been getting quite a few calls lately seeking information on re-bodied vehicles.  The term “rebody” is a term of art used throughout our hobby to denote a vehicle whose original factory body has been replaced with another “donor” body.  The donor body is then given the original body’s VIN, serial number, data card, trim tag, cowl tag, etc. and then usually and most unfortunately sold to an unsuspecting buyer as the original, real deal automobile.  This problem is complicated when the rebodied car is an “air car” which did not exist prior to the rebody.  Specifically what happens is someone dreams up a car or has the paperwork from a desirable car and makes it from “thin air” using the donor body as the starting point.  All of a sudden, the car has pedigree, provenance and history if the builder can dream up a good enough story.  This is problematic as you can plainly see.

There are several legal issues when it comes to a rebodied automobile.  The most important issue is whether or not the rebody was disclosed to you when you purchased the vehicle.  If the rebody was not disclosed to you how can it be said you negotiated with the seller on equal footing.  Another issue comes from the fact that rarely are rebodys done properly.  Were the police notified of the body replacement as required under some state laws?  Did the seller give you two Certificates of Titles?  (Remember the best bodies come from good cars and in today’s day and age, good cars get restored … was the body stolen and the subject vehicle the product of a “chop shop”)  Did the seller give you photographs of the original body to evidence the condition of the original body?  Do you have confirmation that the original body has been destroyed? (This is usually where the State Police come in as this is where the stories start about two cars registered under the same VIN)

Without the safeguards outlined above, you can never been shore that the vehicle you purchased truly belongs to you.  Under the law you would have a breach of the warranty of title claim if any third party were to ever come after you claiming you own the body to their car.  The problem is  that if you know the car has been rebodied and you can’t provide the above information to a new purchaser you could be just as liable as the seller who sold the car to you should you not disclose what you know to a prospective purchaser.

If you have a rebodied car or think you do, this is a serious matter.  Rebodied cars can be nearly unsaleable and always have questions.  There was way to rectify the situation and there are ways to unwind the transaction which unknowingly left you with the rebody.  In any event, please call me and we can discuss your options and to what extent your car may have been rebodied.

Attorney Bryan W. Shook is not only a devoted automotive enthusiast, but is also an experience litigator who devotes a large portion of his law practice to helping other collectors and hobbyists understand today’s market and protect their automotive investments. Attorney Bryan W. Shook is a seasoned automotive collector and restorer and as such brings real world experience and firsthand knowledge to the table for his clients throughout the world. Although Bryan Shook is headquartered in Camp Hill, Pennsylvania (close proximity to Carlisle and Hershey), Attorney Bryan Shook is available anywhere for consultation, advice, and information, most times, on as short as a day’s notice. If you’d like more information about this topic or would like to speak with Attorney Bryan W. Shook please email him at bshook@shooklegal.com or by phone at 717-884-9010.  More information can be found at Http://www.vintagecarlaw.com.

Bid with Knowledge; Buy with Confidence – Vintage Car Law

Collector Car Market Stands to Gain from Latest Economic Meltdown

August 8, 2011 · Posted in News · Comments Off on Collector Car Market Stands to Gain from Latest Economic Meltdown 

Monterey and Beyond: 
A Prediction for the Collector Car Market

(By: Bryan W. Shook, Esquire)

BShook@shooklegal.com

717-884-9010

With the Monterey Auctions only two weeks away, the eyes of the Collector Car Market are on Wall Street and other world markets.

Gold has surpassed Platinum, S&P has downgraded the United States credit rating from AAA to AA and the stock market is plummeting.  How could this possibly be beneficial to the collector car market, you ask … it’s simple.  The stock market, the bond market, the futures and other typical investment arenas are subject to the debt crisis.  While the Collector Car Market is, in a sense subject to the debt crisis, but not nearly to the extent that the traditional markets are.

This economy is somewhat of a double-edged sword.  On one hand, the current debt crisis has undoubtedly caused more than a few cars to come to market, but on the other hand as investors seek safe havens from the latest market crash the world of collector cars looks like a better and safer investment market every day.  Collectors invest in automobiles because of emotion, artistic adoration and quite simply, memories.  A tangible investment is much easier to quantify than a stock certificate and the same is not as susceptible to the tumultuous economic climate we live in today.

Last year’s $172,000,000.00 in sales will likely be eclipsed this year as investors clamor for the many of the blue chip collectible automobiles that the several major auction houses are going to parade across the block.

Don’t be surprised to see a plethora of domestic and foreign collectors alike flock to Monterey, cash in hand to buy up the consigned cars.  Monterey has, for years been THE PLACE to sell your high-dollar, blue chip car … this year the money will be there more than ever.

Thank you to Standard and Poor and all of the world’s economies responsible for this latest turmoil.

Attorney Bryan W. Shook is a devoted automotive enthusiast, but is also an experience litigator who devotes a large portion of his law practice to helping other collectors and hobbyists understand today’s market. Attorney Bryan Shook is available throughout the United States for consultation, advice, and information. If you’d like more information about this topic or would like to speak with Attorney Bryan W. Shook please email him at bshook@shooklegal.com.

Bid with Knowledge; Buy with Confidence – Vintage Car Law

Economics of Car Valuations

June 8, 2011 · Posted in News · Comments Off on Economics of Car Valuations 

 

The Economics of Vehicle Values

 

The value of an antique car or a collector vehicle is driven by three key factors: desirability, pedigree/provenance and condition.  These three factors fit into an equation which eventually leads to the value of the vehicle.  The weight to be assigned to any of the factors is subjectively based upon the influence any one factor has over another.

 

Let’s take a look at these three factors:

 

Desirability: Although this is a subjective measure, it is fairly easy to quantify.  A desirable vehicle is one that nearly anyone would love to own.  Also vehicles that were produced in limited quantities or with attributes or options not commonly found on contemporaneous models are desirable.  Exotic vehicles are usually desirable on their name alone.  Finally, some vehicles are desirable simply because they are cool.  While every vehicle is desirable to a collector on some level (yes, even the Yugo is desirable if you can find a complete and somewhat running example), it is the level of desirability which drives the value.  The more people who like the vehicle; the more desirable the vehicle is.  Specific years, specific models, or specific options can make an otherwise undesirable or not so desirable vehicle desirable for the purpose of valuation.   Keep in mind however, that although desirability drives just one aspect of the pricing structure it can sway the equation completely.  A fitting example is a Duesenberg.  In any condition, and even without any pedigree or provenance, a Duesenberg will ALWAYS command a relatively high value based purely upon its highly regarded desirability and relatively low production figures.  The weight to assign to desirability can also be dependent upon the year, model, options or scarcity of a model.

 

Pedigree/Provenance: This is where most vehicles are lacking.  Time has a way of erasing memories.  By and large, information about a vehicle’s origins was not something that was discussed when the vehicles were sold, “back in the day.”  Most vehicle owners do not have much information about the vehicle before they acquired it. Therefore, when you come across a vehicle with paperwork or history, dating from new, you are looking at a vehicle with pedigree.  Merriam-Webster defines “pedigree” as the origin or history of something.  Items that add pedigree are copies of old titles, registration paperwork, original sales forms, window stickers, build sheets, factory documentation, certification, etc.

 

Provenance is the history of ownership of the vehicle.  Vehicles that were once owned by movie stars or other public figures tend to be worth more than other similar vehicles.  These same vehicles also tend to have more options or unique features which make them more desirable (see above).  Vehicles that have a known, uninterrupted chain of ownership, from new can also be said to have provenance. Nevertheless, the weight assigned to this form of provenance is obviously not the same as the weight assigned to a chain of celebrity ownership or ownership within a large nationally recognized vehicle collection or museum.  For provenance to be given appropriate weight, it must be substantiated with documentation.

 

A vehicle with either pedigree or provenance is worth more than a similar vehicle without.  A vehicle with these attributes is sometimes referred to as a “no stories” vehicle.

 

Condition: This third and final factor is the “make it or break it” for most vehicles.  Even if a vehicle has good desirability and pedigree and/or provenance, it likely won’t influence the value of the vehicle as much as condition.  A vehicle with in superb original condition (i.e. extremely well-kept since new) or a vehicle which has been restored or built/rebuilt to an extremely high level is worth more than a similar vehicle needing restoration or a similar vehicle in a deteriorated condition.  In recent years we have seen a push for original vehicles.  As the appreciation for these examples has risen, so has the weight assigned to originality with respect to valuation.  (Note: An overwhelming public appreciation for a particular vehicle or vehicle trait tends to also weigh heavily on desirability).  The more original a vehicle or the better the restoration of the vehicle, the more the vehicle is worth; period.

 

Although the equation into which these three areas are plugged is somewhat objective on its face, the weight assigned to any one area is subjectively based upon the knowledge, expertise, and experience of the person assigning the value.

 

Any attempt to confidently assign a fixed weight to any of these three areas would be illogical.  There are far too many vehicles with far too many options, characteristics, stories, and degrees of condition to allow for such a rigid valuation method.  Each vehicle must be evaluated first on its own merits and then against similar vehicles with known sales to find a comparable sale.  Then the comparable sales must be evaluated to see how closely they match the subject vehicle.  The closer the comparable sale, the closer your estimate of value will be to the actual value of the subject vehicle.  You must however, keep in mind some principles of economics such as, market saturation versus scarcity, preferences, and rationality (i.e. marginal cost versus marginal benefit).

 

This theoretical approach to the economics of car valuation should provide you with an understanding of why one vehicle is worth so much more than another. The equation described here should be view as a template which along with the expertise of a seasoned professional will likely allow you to confidently arrive at a value for your particular automobile given the economics discussed herein.

 

Attorney Bryan W. Shook is a devoted automotive enthusiast, but is also an experience litigator who devotes a large portion of his law practice to helping other collectors and hobbyists understand today’s market. Attorney Bryan Shook is available throughout the United States for consultation, advice, and information. If you’d like more information about this topic or would like to speak with Attorney Bryan W. Shook please email him at BShook@shooklegal.com

 

Bid with Knowledge; Buy with Confidence – Vintage Automotive, LLC

The Status of Vehicle Titles in Pennsylvania

January 17, 2011 · Posted in News · Comments Off on The Status of Vehicle Titles in Pennsylvania 

The Status of Vehicle Titles in Pennsylvania

By:   Bryan W. Shook, Esquire

bshook@shooklegal.com

BUYING A VEHICLE WITHOUT A TITLE

 In the realm of car collecting, one thing can cloud a bargain more than anything else, a vehicle with no title.  The statement “no title” or “sold on bill of sale only” is usually enough to make most potential purchasers turn and run, FAST.  But should it really scare us away? Perhaps, but not without good reason.

 A vehicle sold without a certificate of title is a vehicle sold with questions.

Before you purchase any vehicle without a title, you must ask yourself the following. 

  1. Why doesn’t the seller have a title to transfer to me?
  2. Is the vehicle listed in either the NMVTIS or the NICB VinCheckSM?
  3. How am I going to get a certificate of title in my name?

Why doesn’t the seller have a title to transfer to me?

The most obvious question is why does the seller not have a title to the vehicle?  There are many potential answers to this question that should be asked prior to negotiating for the purchase of this vehicle.

For instance, the vehicle could be missing its title because it was previously salvaged and somehow escaped destruction (i.e. crushing); or worse yet, the vehicle could be stolen.  These are reasons to RUN, FAST!!!

Often the case, however, is that the vehicle was abandoned, so to speak, by the last owner who held a certificate of title. This usually happened when the vehicle had fallen into such a state of disrepair that the condition and its value at the time made the title and registration of the vehicle a moot point.  Accordingly, whoever acquired the vehicle from the last person may not have requested a transfer of the title for these, or similar reasons.

The answer to this first question often tells you 90% of what you need to know.  Trust your instinct.  If the story sounds fishy or otherwise unbelievable; it probably is.

Is the vehicle listed in either the NMVTIS or the NICB VinCheckSM?

Before you purchase a vehicle without a title you should run the VIN through two sources.  The first is an initiative of the United States Department of Justice located at http://www.vehiclehistory.gov/ and known as the National Motor Vehicle Title Information System (NMVTIS).  The NMVTIS is designed to thwart the registration of stolen vehicles and prevent title fraud.  An important note, however, when researching the NMVTIS for collector cars, is that the system is still in its infancy and relies upon information uploaded from individual states.  Results of the NMVTIS include where the vehicle was previously registered and if it has ever been reported stolen or had any other title issues in the past.  With respect to antique and other older collectible vehicles, it is possible that some “older” thefts may have slipped through the cracks. So, don’t rely too heavily on the results of the NMVTIS search if it comes back with no record found.  This is why it is important to also check the second source.

 The second source that should be checked is the National Crime Insurance Bureau’s (NCIB) VinCheckSM.   This database includes information regarding whether a vehicle has been reported stolen. The link to search the NCIB database is https://www.nicb.org/theft_and_fraud_awareness/vincheck .

 Importance of an Adequate Bill of Sale

 If you choose to go ahead with the purchase and buy the vehicle, it is highly recommended that you have the seller give you a bill of sale for the vehicle.  It is important that the bill of sale identify the vehicle by year, make, model and VIN.  The seller should state something to the effect that they are delivering you the absolute rights of possession and ownership of the vehicle.  The seller should also state that to the best of his/her knowledge the vehicle is not stolen and how they acquired the vehicle and from whom.  Of course the bill of sale should also indicate the date of the transaction and full contact information for both you and the seller.  This will ensure compliance with 13 Pa. C.S.A. § 2401 and will assist you in the acquisition of a certificate of title down the road.

 How am I going to get a certificate of title in my name?

The current laws in Pennsylvania contemplate only scenarios in which certificates of title are transferred with every vehicle transaction.  Therefore, by extension, the law fails to contemplate a scenario in which a person or entity would acquire a vehicle or vehicles for which no owner can produce and accordingly transfer a certificate of title. 

Similarly there appears to be no law, regulation or procedure, formally in place, for the motioning of the Court for a declaration of ownership of a motor vehicle so as to permit Penndot to issue a new certificate of title to memorialize the current owner and allow for registration of the automobile.  Further it is important to note that Penndot has unfortunately purged many of their old motor vehicle records, including ownership and registration records.  As a result, Penndot openly states that “[v]ehicle record information is available for the past 10 years only.”  Penndot Form DL-135 (Rev. 9-10).  Obviously this practice of record retention leaves open many scenarios whereby an owner cannot acquire a certificate title because Penndot has no record of ever issuing one.

What can be done to acquire a title?  One solution is to Petition the Court of Common Pleas in Pennsylvania.  Attorney Bryan Shook can assist you with this.  He can be reached at BShook@shooklegal.com.

Legal History Lesson:

Vehicle titles in Pennsylvania are often the most misunderstood aspect of vehicle ownership.  This is because of historically misinterpreted and misunderstood notions of what exactly constitutes “ownership” of a motor vehicle in Pennsylvania.

Under the Pennsylvania Motor Vehicle Code, an “owner” is defined as:

A person, other than a lienholder, having the property right in or title to a vehicle. The term includes a person entitled to the use and possession of a vehicle subject to a security interest in another person, but excludes a lessee under a lease not intended as security.

75 Pa. C.S.A. § 102.

The Superior Court has described titles and ownership this way;

[i]n Braham & Co. v. Steinard-Hannon Motor Co., 97 Pa.Super. 19, 23 (Pa. Super. Ct. 1929), though it involved the interpretation of earlier legislation concerning motor vehicles, the following language of Judge, later President Judge, Keller is nonetheless pertinent and applicable to The Vehicle Code of the present day: ‘It is clear that the primary purpose of the Act of 1923, supra, was to protect the public against the theft of automobiles and their resale by the thief, and to facilitate the recovery of stolen automobiles. It was a police measure, and was not designed to establish the ownership or proprietorship of the car, * * *.’ And at page 25, of 97 Pa.Super. Judge Keller said: ‘It follows that the act does not provide nor intends to provide that the ‘certificate of title’ shall determine the absolute ownership of the car, or alter or affect in any manner the actual ownership of the vehicle and the relations of the persons interested in it. It only requires registration by the person entitled to its possession and in control of its operation. The certificate is not a warrant of ownership or muniment of title as usually understood in the law. It may be relevant evidence in establishing such title.

Weigelt v. Factors Credit Corp., 174 Pa.Super. 400, 404, 101 A.2d 404, 406 (Pa. Super. Ct. 1954)

The idea that a vehicle may have both a legal and an equitable owner was recognized by the Commonwealth Court in Dept. of Trans. v. Walker, 136 Pa.Cmwlth. 704, 584 A.2d 1080 (1990).  The Court in Walker stated that “[i]t follows that Section 102 of the [Vehicle] Code does not provide nor intend to provide that title to a motor vehicle shall determine absolute ownership of such. In fact, our research reveals that in Pennsylvania, the certificate of title constitutes no more than some evidence of ownership.”  Id., 584 A.2d at 1082, citing Semple v. State Farm Mutual Automobile Insurance Co., 215 F.Supp. 645 (E.D.Pa.1963). See also Aetna Casualty & Surety Co. v. Duncan, 972 F.2d 523 (3d Cir.1992) (under Pennsylvania law, a state-issued certificate of title is in no way controlling on the question of ownership).

The courts of Pennsylvania look to see who it is that in fact possesses the attributes commonly associated with ownership.  Aetna Casualty & Surety Co., at 526.    The elements of ownership that Pennsylvania looks at are the elements of use, benefit, possession, control, responsibility for, and disposition of the automobile.  Wasilko v. Home Mut. Cas. Co., 210 Pa.Super. 322, 326, 232 A.2d 60, 62 (Pa. Super. Ct. 1967).

Conclusion

In summation, although you may not have received an actual certificate of title when you purchased your vehicle, you still most likely own the vehicle.  This is barring any type of theft in the vehicle’s past or another “owner” stepping in and challenging your interest while asserting that their interest is legally better than yours. 

With this in mind, the motioning of the Courts for a declaration that you are the owner of the vehicle, and therefore entitled to a certificate of title from Penndot is often your best bet in getting the vehicle properly titled and on the road.  The declaration of ownership is possible if you have actual legal ownership of the vehicle.  The court will, to the extent that it is able, extinguish the rights and interests of all others, whom you are able to find and notify of the proceedings, in the vehicle.  This will ultimately allow you to register and enjoy your vehicle without having the issue of not having a title hanging over your head and clouding your “ownership” of the vehicle.

Finally, always remember that a vehicle sold without a certificate of title is a vehicle sold with questions.  This, however, does not absolutely mean that the vehicle can never again be titled.  It does however underscore the need for the exercising of enhanced due diligence throughout the transaction.

The above information is in no way meant to be construed as anything more than general information.  The above information is not legal advice.  The author encourages you to seek the help of an attorney any time you are contemplating the purchase of a vehicle without a certificate of title.  Further THE AUTHOR ASSUMES NO RESPONSIBILITY AND ACCEPTS NO LIABILITY FOR ACTIONS TAKEN BY USERS OR READERS OF THIS DOCUMENT, INCLUDING RELIANCE ON ITS CONTENTS.  It is strongly encouraged that you seek legal counsel for all matters related to a collector or antique vehicle purchase given the amount of money involved and the rarity of the vehicles.  This information is not intended nor does it create an attorney-client relationship. 

This page includes links for your assistance only.  This page is in no way associated with the NCIB page or the NMVTIS. 

Bryan W. Shook, Esquire is a devoted automobile enthusiast.  Attorney Shook would be glad to help you with any vehicle title issues you may have including lost titles, no titles, bill of sale transactions, etc.  Attorney Shook is a collector and as a collector knows the ins and outs of the hobby, let Attorney Shook’s legal knowledge of the collector car hobby work for you.  Attorney Bryan Shook can be reached at 717-884-9010 or by email at BShook@shooklegal.com.  For more information – http://www.vintagecarlaw.com.

Next Page »