Summary
In Commercial Credit Corp. v. Pottmeyer, supra (176 Ohio St. 1), a case in which the question of theft was not before the court, four members of the court agreed in the syllabus (paragraph four) that "[a]n Ohio bona fide purchaser of a motor vehicle may be protected whether his Ohio certificate of title resulted from fraudulent representations of a swindler or a thief."
Summary of this case from Hardware Mutual Casualty Co. v. GallOpinion
No. 38076
Decided March 18, 1964.
Motor vehicles — Certificate of Title Act — Statutory protection of bona fide purchaser — Statutory construction of amendment — Replevin action by claimant of title or interest — Against Ohio purchaser with apparently valid certificate — Ohio purchaser protected whether certificate resulted from fraud or theft.
1. A statute can protect a bona fide purchaser of a chattel by enabling him to obtain a better title than his vendor, even where his vendor is a thief.
2. Where the General Assembly amends a statute for the apparent purpose of changing to a limited extent the interpretation previously given by the Supreme Court to the words of that statute, the re-enactment of the statute with such amendment will, except to the limited extent indicated by the words of such amendment, represent an express approval by the General Assembly of the Supreme Court's previous interpretation of the words of the statute.
3. One who claims a right, title or interest in or to a motor vehicle but whose claim is not noted upon any Ohio certificate of title cannot prevail in an action in replevin against a purchaser in Ohio of such motor vehicle, who acquired possession in Ohio of such vehicle together with an apparently valid Ohio certificate of title therefor in good faith and without notice of any right, title or interest in such vehicle not set forth in his certificate of title. (Sections 4505.01 to 4505.19, Revised Code, applied; Kelley Kar Co. v. Finkler, 155 Ohio St. 541, approved and followed; Atlantic Finance Co., Inc., v. Fisher, 173 Ohio St. 387, overruled; Gibson v. Bolner, 165 Ohio St. 357, distinguished.)
4. An Ohio bona fide purchaser of a motor vehicle may be protected whether his Ohio certificate of title resulted from fraudulent representations of a swindler or of a thief.
APPEAL from the Court of Appeals for Washington County.
In the instant case, the Court of Appeals affirmed a judgment of the Common Pleas Court in favor of plaintiff in an action of replevin to recover possession of a Pontiac automobile. The cause is now before this court on appeal from the judgment of the Court of Appeals, pursuant to allowance of a motion to certify the record.
Messrs. Metcalf Thomas and Messrs. Goodwin, Mead Goodwin, for appellee.
Messrs. Summers, Haupt Theisen, for appellant.
The agreed statement of facts discloses the following pertinent facts with respect to the Pontiac automobile which plaintiff seeks to replevin from defendant:
1. On January 12, 1961, Clarke Pontiac, Inc., entered into a conditional sales agreement with Betty Williams, providing for payment of a balance of $3,528.72 at $98.02 per month, possession of the Pontiac was delivered to Betty Williams and the agreement was assigned to plaintiff. The agreement was later recorded as required by the West Virginia statutes. Nothing has been paid on that agreement since the February 1961 monthly payment.
2. On January 16, 1961, Betty Williams and two others applied for a West Virginia certificate of title for the Pontiac in the name of Hess Buick Company and, on January 17, 1961, obtained such a certificate. No liens were noted on this certificate. The certificate indicated that Hess Buick had received its title directly from the manufacturer. The statement to that effect, made by Hess Buick or its agent in applying for the certificate, was false.
3. Subsequently, on January 18, 1961, another West Virginia certificate of title was issued to Betty Williams. This certificate bore a notation of plaintiff's lien in the amount of $3,528.72.
4. On January 19, 1961, defendant, a resident of Ohio, purchased the Pontiac from Hess Buick Company at a Columbus, Ohio, automobile auction in good faith without any knowledge of the foregoing facts.
5. Defendant took possession of the Pontiac, and thereafter on January 20, 1961, defendant presented the Hess Buick Company West Virginia certificate of title to the clerk of courts of his county and received an Ohio certificate of title for the Pontiac. That certificate does not show the lien upon which plaintiff relies.
On the foregoing facts, paragraph five of the syllabus and the decision in Kelley Kar Co. v. Finkler (1951), 155 Ohio St. 541, 99 N.E.2d 665, clearly require a judgment for defendant. That paragraph reads:
"One who claims a right, title or interest in or to a motor vehicle by virtue of a conditional sales contract executed in a state other than Ohio, which instrument purports to retain title in the claimant until the entire purchase price is paid, and which claimant does not possess an Ohio certificate of title covering such automobile and whose claim of right, title or interest under such conditional sales contract is not noted upon any Ohio certificate of title covering said automobile, cannot prevail in an action in replevin against one in Ohio who holds an Ohio certificate of title therefor and who purchased such automobile in good faith and for value from one in possession of said automobile and who held an Ohio certificate of title covering said automobile which did not bear on its face any notation of the right, title or interest claimed under such conditional sales contract so executed in a state other than Ohio."
After the decision in the Kelley Kar case, it was generally recognized that the clear words of the Ohio Certificate of Title Act had in effect imparted negotiability in Ohio to an automobile in the possession of one holding an Ohio certificate of title showing him as owner. Cf. Shaw v. Wearley Motor Co. (1962), 173 Ohio St. 185, at 188 and 189, 180 N.E.2d 823.
Thus, innocent Ohio purchasers with Ohio certificates of title have usually been protected by the reported decisions of our Courts of Appeals against out-of-state lien claimants whose claims were either unrecorded or so recorded as to prevent any reasonable chance of discovery. Royal Industrial Bank of Louisville v. Klein (Hamilton County, 1952), 92 Ohio App. 309, 110 N.E.2d 40; Commercial Credit Corp. v. Reising (Hamilton County, 1953), 96 Ohio App. 445, 122 N.E.2d 301; Fayette Investment Corp. v. Jack Johnson Chevrolet Co., 119 Ohio App. 111; Riley v. Motorists Mutual Ins. Co. (this day decided), 176 Ohio St. 16. But see Ohio Casualty Ins. Co. v. Guterman (Montgomery County, 1954), 97 Ohio App. 237, 125 N.E.2d 350 , in accord with Atlantic Finance Co., Inc., v. Fisher (1962), 173 Ohio St. 387, 183 N.E.2d 135, which is being overruled by this decision. Associates Discount Corp. v. Colonial Finance Co. (Mahoning County, 1950), 88 Ohio App. 205, 98 N.E.2d 848, and Mock v. Kaffits, Chief of Police (Franklin County, 1944), 75 Ohio App. 305, 62 N.E.2d 172, were decided before our decision in the Kelley Kar case and appear to be irreconcilable with that decision and with our decision in the instant case. Gibson v. Bolner (1956), 165 Ohio St. 357, 135 N.E.2d 353, is a case where no one had an Ohio certificate of title. In the opinion in the Kelley Kar case (550, 551), it is stated:
"`Whether the policy of this law is good or bad is not for us to say. The matter of the wisdom or good policy of a legislative act is a matter for the Legislature to determine. The courts are required to give effect to the legislative act if it does not violate the Constitution. In this case there is no question of the violation of any constitutional provision but only the withdrawing of comity which would otherwise exist.'
"* * *
"The General Assembly of the sovereign state of Ohio has declared the policy of this state by enactment of the Certificate of Title Act containing Section 6290-4, General Code [now Section 4505.04, Revised Code]. The appellee has not complied with that law. The appellant has complied with it. Therefore the appellee cannot prevail and procure possession of the automobile in question."
This court thereby asked the General Assembly to change the law if it disagreed with the interpretation which we had given to it.
The General Assembly not only acquiesced in the effect given to Section 4505.04, Revised Code, by our decision in the Kelley Kar case but affirmatively approved it. Thus, at its next session after that decision, the General Assembly amended Section 4505.04 apparently for the purpose of limiting to some extent the literal application given by this court to that statute. But, in doing so, it only authorized one additional means of evidencing a "right, title, claim or interest * * * in or to any motor vehicle," other than "a certificate of title or a manufacturer's or importer's certificate issued in accordance with Sections 4505.01 to 4505.19." The only additional means so authorized was "by admission in the pleadings or stipulations of the parties." 125 Ohio Laws, 117, effective October 2, 1953. See Peters Motors, Inc., v. Rodgers (1954), 161 Ohio St. 480, 120 N.E.2d 80, which reached the same conclusion without reference to amendment of the statute.
At that time, the General Assembly re-enacted the words of Section 4505.04 which this court had applied in the Kelley Kar case and thereby gave its express approval to that decision's construction of those words in that case.
Thus, in order to affirm the judgment of the Court of Appeals and hold for plaintiff in the instant case, it would be necessary not only to overrule our decision in the Kelley Kar case but also to modify the intention so expressed by the General Assembly. To do so would obviously amount to a usurpation of legislative power by this court.
There is nothing unusual about our decision in the Kelley Kar case. This court had previously recognized that an innocent purchaser of personal property for value without notice may be protected against the claim of an innocent owner who entrusted that property to a wrongdoer and thereby made it possible for the wrongdoer to fraudulently and wrongfully dispose of it. See Lippincott Distributing Co. v. Peoples Commercial Savings Bank (1940), 137 Ohio St. 399, 30 N.E.2d 691.
The dissenting opinion recognizes that the words of Section 4505.04, Revised Code, "standing alone," as well as our decision in the Kelley Kar case, require the reversal of the judgment of the Court of Appeals. In order to avoid the effect of the words of that statute and to support the overruling of our decision in the Kelley Kar case applying those words, reliance is placed upon "the purpose of the Certificate of Title Act, as stated in its title," and upon Sections 4505.10, 4505.02 and 4505.17, Revised Code.
Until the enactment of the Certificate of Title Act (now Section 4505.01 et seq., Revised Code) in 1937, the only legal protection which a buyer of a motor vehicle had for the title to a motor vehicle he was purchasing was provided by the statutory requirement that a motor vehicle registration and a bill of sale be given by the seller to the buyer. See Kelley Kar Co. v. Finkler, supra ( 155 Ohio St. 541), 545. As a result, a buyer usually had no means of determining whether he would receive a valid title. He had to rely almost entirely on the seller's representations. This made it relatively easy to dispose of stolen motor vehicles in Ohio and so encouraged the importation of stolen motor vehicles as well as frauds in the transfer of titles to motor vehicles.
Because of the Certificate of Title Act, it is not now easy for one, who does not have a valid title to a motor vehicle, to get what he needs to sell that motor vehicle in Ohio, i.e., an Ohio certificate of title. In order to do so fraudulently, he exposes himself to conviction as a felon. See Section 4505.19, Revised Code. He also runs the risk of an early discovery of any previous theft of the motor vehicle.
For example, Section 4505.08, Revised Code, provides in part:
"The clerk of courts * * * shall issue certificates of title in triplicate. * * * [the duplicate] copy shall be transmitted on the day it is issued to the Registrar of Motor Vehicles."
Section 4505.02, Revised Code, provides in part:
"The registrar shall check with his record all duplicate certificates of title received * * *."
Section 4505.17, Revised Code, provides in part:
"The registrar, whenever he receives a report of the theft or conversion of a motor vehicle, whether the same has been registered or not and whether owned in this or any other state, shall make a distinctive record thereof, including the make of the stolen vehicle and its manufacturer's serial number or motor number, and shall file the same in the numerical order of the manufacturer's serial number or motor number with the index records of the vehicles of such make. * * *
"In the event of the receipt from any clerk * * * of a copy of a certificate of title to such motor vehicle, the registrar shall immediately notify the rightful owner thereof and the clerk who issued such certificate * * *, and if, upon investigation, it appears that such certificate of title was improperly issued, the registrar shall immediately cancel same."
Thus, by reason of the provisions of the Certificate of Title Act, it has been made much more difficult and hazardous than it ever was before for a wrongdoer to dispose of a stolen motor vehicle in Ohio. It is apparent that, as contemplated by the words of the purpose clause of the Certificate of Title Act, "thefts" of motor vehicles and "the importation of stolen motor vehicles," as well as "frauds in the transfer of titles to motor vehicles," are all discouraged by the foregoing provisions of the act.
The protection of innocent Ohio purchasers of motor vehicles is not inconsistent and does not interfere with those provisions of the act, but instead such protection obviously represents an additional preventative against "frauds in the transfer of title to motor vehicles."
In Kelley Kar Co. v. Finkler, supra ( 155 Ohio St. 541), 545, Judge Middleton described the reason for enactment of the Certificate of Title Act, as follows:
"Because of their mobility and frequent change of ownership it was obviously necessary to create an instrument evidencing title which would more adequately protect innocent purchasers of motor vehicles."
Section 4505.10, Revised Code, does indicate that there may be instances where a certificate can be issued to someone who does not claim under an Ohio certificate. However, there is nothing in that statute to indicate that, where a certificate has been issued to a bona fide purchaser, the certificate so issued may not be valid. (It may be observed that plaintiff has made no effort to use this statute to acquire an Ohio certificate that might note his interest thereon.)
The dissenting opinion apparently relies upon Sections 4505.02 and 4505.17, Revised Code, because of the assumption that the registrar may, without having his determination reviewed by any court, finally determine that a previously issued certificate of title should be cancelled. Obviously, the ruling of the registrar, that a certificate had been "improperly issued," would not be immune from judicial review. See State, ex rel. City Loan Savings Co., v. Taggart, Recorder (1938), 134 Ohio St. 374, 378, 17 N.E.2d 758. The words "improperly issued" in those two sections are not defined, and there is nothing in either section requiring or even suggesting the conclusion that a certificate issued to a bona fide purchaser should be considered as "improperly issued." On the contrary, Section 4505.02, Revised Code, even states that cancellation of a certificate "shall not affect the validity of any lien noted" on the cancelled certificate. (It may be observed that there is nothing to indicate that defendant's certificate of title has been cancelled as "improperly issued.")
It is contended that protection of one, who acquires as a bona fide purchaser a motor vehicle, together with an apparently valid certificate of title thereto, would make Ohio "a dumping ground for converted motor vehicles." This contention is based upon the false assumption that such protection would be inconsistent with prevention of the importation into Ohio of stolen motor vehicles, thefts of motor vehicles and frauds in the transfer of title to motor vehicles.
Both plaintiff, who is an assignee of rights of the out-of-state conditional vendor, and defendant, the Ohio resident who purchased the Pontiac in Ohio and secured a good Ohio certificate of title for it, are innocent parties. One must suffer a loss equal to the value of the Pontiac, subject to the remote possibility of recovery from the wrongdoer whose "fraud in the transfer of title" to the Pontiac was the cause of that loss. That wrongdoer is the conditional vendee to whom the Pontiac was delivered by the vendor upon whose lien plaintiff relies.
As pointed out by Middleton, J., in his opinion in Kelley Kar Co. v. Finkler, supra ( 155 Ohio St. 541), 551:
"Innumerable cases can be cited wherein one in possession of an automobile and claiming title thereto through purchase in good faith and payment of value therefor was protected against claims based upon instruments executed in a state foreign to the state of the forum. In some instances the decisions were based upon certificate of title laws; in others the courts have held that the one who gave up possession of the automobile together with some indicia of title should suffer rather than a subsequent innocent purchaser for value."
The trial court and the Court of Appeals in this case were undoubtedly misled by our recent decision in Atlantic Finance Co., Inc., v. Fisher (1962), 173 Ohio St. 387, 183 N.E.2d 135. The opinion (page 390) in that case offers as one distinction of the Kelley Kar case that, in the Atlantic Finance case, neither of the innocent parties "by its or his actions induced the problem or could have prevented it."
The opinion by Kerns, J., in the Court of Appeals case of Fayette Investment Corp. v. Jack Johnson Chevrolet Co., supra ( 119 Ohio App. 111), recognizes this in stating that "the * * * clear line of distinction between the Atlantic Finance Co. case and the Kelley Kar case * * * is that the plaintiff in the one voluntarily relinquished possession of the automobile, whereas in the other, the plaintiff did not voluntarily relinquish possession."
However, there is nothing in the Certificate of Title Act to justify the conclusion that the General Assembly intended to protect a bona fide purchaser of an automobile where his Ohio certificate resulted from the fraudulent representations of a swindler, but not where that certificate resulted from such representations by a thief.
The decision in the Atlantic Finance case was apparently based upon the following broad statement found in the opinion (page 391):
"It is well settled that * * * a bona fide purchaser for value without notice from a thief obtains no better title than the thief."
No authorities are cited in support of that broad statement.
Even apart from statute, there are instances where a bona fide purchaser for value without notice from a thief will obtain a better title than a thief.
For example this is true with respect to money. 36 American Jurisprudence, 460, Section 6.
A statute of limitations may even have the effect of transferring title to a thief. See Ames, Lectures on Legal History (1913), 201.
Certainly, statutes can provide for protection in reasonable instances of one who purchases property in good faith for value without notice from a thief. See Lalive, The Transfer of Chattels in the Conflict of Laws (1955), 176, 177; Note: The power of a state to affect title in a chattel atypically removed to it (1947), 47 Columbia Law Review, 767; Developments in the Law — Conflict of Laws (1937), 50 Harvard Law Review, 1119, 1136.
For example, a bill of lading or a warehouse receipt is regarded as a symbol of the property for which it is issued. In other words, title to the property for which such a document has been issued may in effect be embodied in such document. In such instance, transfer of such a document of title will be given the same effect as would transfer of the property itself. The Uniform Sales Act (former Section 1315.39, Revised Code), the Uniform Warehouse Receipts Act (former Section 1323.47, Revised Code), and the Uniform Bill of Ladings Act (former Section 4965.35, Revised Code) expressly provided for protection of a bona fide purchaser of such a document even where stolen from its true owner. The Uniform Commercial Code contains similar provisions (Section 1307.30, Revised Code).
There is, therefore, nothing unusual in having the clear words of the Certificate of Title Act impart negotiability to an automobile in the possession of one having an Ohio certificate of title showing him as the owner.
This court reached an erroneous result in the Atlantic Finance case because it not only refused to recognize that a statute could protect a bona fide purchaser of a chattel by enabling him to obtain a better title than his vendor but also because it apparently unreasonably assumed (opinion, page 390) that the "public policy of Ohio of protecting innocent purchasers * * * should weigh no more heavily in the scales than the protection of innocent citizens of our sister states from theft." If, as the opinion recognizes (page 390), "one of two equally innocent parties must bear the loss," is it reasonable to assume that the Ohio General Assembly intended to impose that loss on the one who is an Ohio bona fide purchaser with an Ohio certificate of title, especially where the General Assembly had specifically stated (Section 4505.04, Revised Code) that "no court * * * shall recognize the right, title, claim or interest of any person in or to any motor vehicle * * * unless evidenced * * * by a certificate of title or a manufacturer's or importer's certificate issued in accordance with" the Ohio Certificate of Title Act?
That a principal purpose of the Ohio Certificate of Title Act is to protect Ohio bona fide purchasers against wrongdoers is also made clear by our decision in Mutual Finance Co. v. Kozoil (1961), 172 Ohio St. 265, 175 N.E.2d 88, protecting a bona fide purchaser of a motor vehicle even without a certificate of title against a lienholder with a manufacturer's certificate for the motor vehicle, where that lienholder had made it possible by his inaction for his debtor to defraud the purchaser. In that case, a finance company advanced to a manufacturer the wholesale purchase price of an automobile purchased by a dealer. As security, the finance company was to retain possession of the manufacturer's statement of origin until the dealer paid him for the automobile after its sale. When paid, the finance company was then to deliver the manufacturer's statement so as to enable the dealer to get a certificate of title for the buyer. The dealer delivered an automobile to a buyer but failed to pay the finance company for it before the dealer became bankrupt. In holding that the finance company could not recover possession of the automobile from the buyer and was required to deliver the manufacturer's statement of ownership to the clerk of courts for issuance of a certificate of title to the buyer, this court said in a per curiam opinion:
"`* * * The title law was passed for the purpose of preventing fraud and deception in passing title to automobiles, not to encourage it. The purchaser, as well as the lending agency, is entitled to its benefits. * * *
"`* * *
"`* * * It seems incredible that judicial interpretation of the motor vehicle title law should find within its provisions a legislative purpose to defeat the right of an innocent purchaser for value * * *.'"
From what we have said, it is apparent that the judgment of the Court of Appeals must be reversed and final judgment must be rendered for defendant.
Judgment reversed.
O'NEILL, HERBERT and GIBSON, JJ., concur.
ZIMMERMAN, MATTHIAS and GRIFFITH, JJ., dissent.
I find that I cannot agree with the majority in this case.
Once again we have before us a consideration of the rights of a bona fide purchaser of a motor vehicle in relation to claims of ownership or encumbrances which are not disclosed by an Ohio certificate of title.
The confusion which has arisen in this area of the law has resulted because the courts have applied the provisions of Section 4505.04, Revised Code, without considering the remainder of the Certificate of Title Act.
Section 4505.04 reads in pertinent part as follows:
"No court in any case at law or in equity shall recognize the right, title, claim, or interest of any person in or to any motor vehicle sold or disposed of, or mortgaged or encumbered, unless evidenced:
"(A) By a certificate of title or a manufacturer's or importer's certificate issued in accordance with Sections 4505.01 to 4505.19, inclusive, of the Revised Code."
This section, standing alone, appears to make evidence of an Ohio certificate of title the only method by which proof of title or liens may be made. However, when it is read in light of the legislative purpose and in context with the other sections of the Certificate of Title Act, it becomes obvious that the certificate of title is not, and was not meant to be, conclusive as to title and the existence of encumbrances.
The purpose of the Certificate of Title Act as stated in its title is:
"To prevent the importation of stolen motor vehicles and thefts and frauds in the transfer of title to motor vehicles * * *." (Emphasis added.) 117 Ohio Laws, 373.
The Supreme Court of Texas, in Bank of Atlanta v. Fretz (1950), 148 Tex. 551, 560, 226 S.W.2d 843, aptly stated the spirit of this act when it said:
"The spirit and purpose of this law is to prevent fraud; not to encourage it. It was not the intention of the Legislature by this act to invalidate liens validly acquired in states which do not have a similar law, and this is especially true in the event a vehicle covered by a lien is wrongfully, without the knowledge or consent of the lienholder, removed from the state where the lien was acquired and brought to this state, and the owner by false and fraudulent representations obtains a certificate of title showing that no lien exists against the vehicle, so that he is thereby enabled to transfer the vehicle to an innocent purchaser for value without notice of the lien."
If an Ohio certificate of title acquired by false representations cannot be shown to be defective, the legislative purpose would be thwarted. A prospective purchaser in Ohio would have no incentive to check into the title to an out-of-state vehicle if the seller possessed an Ohio certificate of title. Thieves and swindlers would be anxious to deal with such willing buyers and Ohio would become a dumping ground for converted motor vehicles. See 1 Beale, Conflict of Laws, 294, Section 50.2; Associates Discount Corp. v. Colonial Finance Co. (Mahoning County, 1950), 88 Ohio App. 205, 210; and Mock v. Kaffits Chief of Police (Franklin County, 1944), 75 Ohio App. 305, 308.
To implement its purpose the General Assembly enacted what are now Sections 4505.01 to 4505.19, inclusive, Revised Code. An examination of these sections discloses how the seemingly absolute language of Section 4505.04 is modified. They provide for instances where a claim of ownership can be substantiated otherwise than by an Ohio certificate of title.
Section 4505.10, Revised Code, entitled "Certificate of title when ownership changed by operation of law," reads as follows:
"In the event of the transfer of ownership of a motor vehicle by operation of law, . . . the Clerk of the Court of Common Pleas of the county in which the last certificate of title to said motor vehicle was issued, upon the surrender of the prior certificate of title or the manufacturer's or importer's certificate, or, when that is not possible, upon presentation of satisfactory proof to the clerk of ownership and rights of possession to such motor vehicle, and upon payment of the fee prescribed in Section 4505.09 of the Revised Code, and presentation of an application for certificate of title, may issue to the applicant a certificate of title to such motor vehicle. Only an affidavit by the person or agent of the person to whom possession of such motor vehicle has passed, setting forth the facts entitling him to such possession and ownership, together with a copy of the journal entry, court order, or instrument upon which such claim of possession and ownership is founded, is satisfactory proof of ownership and right of possession. If the applicant cannot produce such proof of ownership, he may apply directly to the Registrar of Motor Vehicles and submit such evidence as such applicant has, and the registrar may thereupon, if he finds the evidence sufficient, authorize the clerk to issue a certificate of title. If, from the records in the office of said clerk, there appears to be any lien on said motor vehicle, such certificate of title shall contain a statement of said lien unless such application is accompanied by proper evidence of its extinction." (Emphasis added.)
This section covers instances where ownership of a motor vehicle is changed by operation of law, e.g., by inheritance, replevin action, or breach of condition in a chattel mortgage. It specifically provides that a certificate of title may be issued upon presentation of proof other than a certificate of title.
By Sections 4505.02 and 4505.17, Revised Code, the Registrar of Motor Vehicles is given the authority and duty to check the duplicate certificates which he receives against his records of certificates previously issued and against his records of stolen and converted automobiles to determine if a certificate has been issued improperly. If he finds that a certificate should not have been issued he is to immediately cancel it. It is significant that the criterion used is not whether the holder of the certificate of title acted in bad faith or had notice of the claim of another but whether the certificate was improperly issued.
In this case, the plaintiff's lien was noted on the West Virginia certificate of title originally issued to Williams. This court has held that such a certificate is a public act and record of the state where it was issued and is entitled to full faith and credit unless such entitlement would be against the public policy of Ohio. Gibson v. Bolner (1956), 165 Ohio St. 357, paragraph two of the syllabus.
Admitting the out-of-state certificate into evidence in this case would be in accord with the policy to prevent the importation of stolen motor vehicles, expressed in the title of the Certificate of Title Act. This act cannot be said to evidence a public policy to protect innocent holders of an Ohio certificate of title since it provides that such a certificate valid on its face may be cancelled by the Registrar of Motor Vehicles in the event it was improperly issued. See Sections 4505.02 and 4505.17, Revised Code.
The result reached by the majority in this case is contrary to the purpose of the act and to the position taken by the Restatement of the Law (Conflicts, Sections 265 and 268), by noted textwriters (Goodrich, Conflicts, Sections 157 and 158, and Beale, Conflicts, Sections 50.2 and 266.3), and by the overwhelming majority of cases, e.g., Mercantile Acceptance Co. v. Frank (1928), 203 Cal. 483, 265 P. 190; Federico v. Universal C.I.T. Credit Corp. (1959), 140 Colo. 145, 343 P.2d 830; Vincent v. General Motors Acceptance Corp. (Florida, 1954), 75 So.2d 778; General Motors Acceptance Corp. v. Nuss (1940), 195 La. 209, 196 So. 323; Metro Plan, Inc., v. Kotcher-Turner, Inc. (1941), 296 Mich. 400, 296 N.W. 304; and Bank of Atlanta v. Fretz, supra.
The ultimate consequence of the majority opinion is to take away from the courts their traditional function of protecting the innocent owner or lienholder from the swindler, thief and confidence man, and to place redress of such owner or lienholder solely within the power of the Registrar of Motor Vehicles.
ZIMMERMAN and GRIFFITH, JJ., concur in the foregoing dissenting opinion.