Used Car Problems.ABC Motors sold a used car to Frank,who wrote a bad check for the car and left town but not before he sold the car to Betty,who paid $1,100 (a fair price for the car) believing that Frank had all rights to sell it.Assuming that ABC Motors was an innocent purchaser from the thief,which of the following is true regarding Betty's obligations,if any?

A) She is not required to return the car because Frank held voidable title,not void title.
B) She is not required to return the car under the UCC because she paid over $1,000 for it.
C) She is required to return the title because Frank held voidable title,not void title.
D) She is required to return the title under the UCC because she paid under $5,000 for it.
E) Under the UCC,the car should be sold with ABC and Betty splitting the proceeds.Under the UCC,the car should be sold with ABC and Betty splitting the proceeds.

Question

Gavin Cagle · Accepted Answer

Final Answer : A, Explanation :  Voidable title occurs in certain situations in which the contract between the original parties would be void but the goods have already been sold to a third party.In this case,because the title was not void,Frank could pass good title to Betty,a good faith purchaser for value.

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