The Rhode Island Supreme Court has ruled that a former salesman must indemnify a North Kingstown used-car dealership for a stolen car he sold using its dealer's license number.
The court unanimously said no trial is necessary on the reimbursement claim against Robert Spigel by the owners of Frenchtown Auto Sales, Glenn and Ann McCrory.
Spigel had a complex relationship with Frenchtown, according to the court and the McCrorys' lawyer, James Currier of Providence:
He was employed as a Frenchtown salesman authorized to sell the dealership's cars at the lot and at auctions on commission. Under his own name and that of his corporation, A Smiling Mr. Bob Enterprises Inc., he also rented a bay from Frenchtown to service and repair vehicles. And he was authorized to sell vehicles not owned by Frenchtown, without paying any of the proceeds to the dealership.
Neither Spigel nor A Smiling Mr. Bob had a Rhode Island dealer's license, the court said.
Acting on his own behalf, Spigel bought three vehicles from his nephew in 1996, the court said. He sold two to Apollo Auto Sales in Cumberland for $40,000 to $45,000, but returned the money after Apollo discovered the vehicles had been stolen.
He sold the third stolen vehicle, a Toyota 4Runner, to Tarbox South County Toyota in North Kingstown for $18,000, and paid $14,000 of it to his nephew. He testified that after hearing from Apollo, he notified Tarbox not to sell the Toyota and notified the state police to retrieve the vehicle.
However, Spigel failed to repay Tarbox.
The state Motor Vehicle Dealers Commission ordered the McCrorys to reimburse Tarbox since the stolen Toyota had been sold using their dealer's license number. 'We paid it to the insurance carrier for the dealer (Tarbox) who got stuck,' Currier said.
Currier said it was obvious the vehicles had been stolen because 'the title certificates were identical forgeries.' Spigel has not been criminally charged, but 'the police are still investigating.'
Defense lawyer Edward McCormick III of Providence said Spigel had no knowledge the vehicles were stolen. 'My client was never prosecuted. He cooperated with the police.'
The McCrorys sued Spigel to recoup the money, asserting he had unlawfully used their dealer's license and held himself out as Frenchtown's agent when selling the stolen vehicles.
They won a Providence County Superior Court order requiring Spigel to pay them $20,200, plus interest and court costs.
The state Supreme Court unanimously upheld the award, ruling that Spigel is personally liable, not A Smiling Mr. Bob, since the corporation was not licensed by the state.
It said the McCrorys proved they are entitled to indemnification since they were 'blameless. They never saw the 4Runner or any documents pertaining to its transfer.'
There is no further appeal, McCormick said.
Currier said Spigel has filed for bankruptcy protection, but the McCrorys are contesting the potential discharge of that debt because it is based on fraud.