Court Upholds Verdict for Car Supplier in Repo Case

(CN) - In a case of first impression, a California appeals court upheld a verdict for a car wholesaler whose cars were repossessed after a consignment store went under. The court said the jury was properly instructed to view the supplier's interests as superior to a creditor's.

Behyar Fariba is a car wholesaler who provided vehicles to California Auto Sales and Leasing (CASL) on a consignment basis.

When CASL went out of business, Fariba tried to retrieve 14 of his vehicles, only to find that Dealer Services Corp. (DSC), one of the dealership's creditors, had repossessed them.

Fariba sued DSC and won repossession of the cars and $32,500 in damages.

DSC appealed, and in an issue of first impression, Justice Nares of the Fresno-based Fourth District California Courts of Appeal upheld the verdict.

"The court properly instructed the jury that Fariba's interest in his consigned vehicles was superior to that of DSC if DSC had actual knowledge CASL was substantially engaged in selling vehicles that belonged to others; and there is substantial evidence that DSC had such knowledge," Nares wrote.

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