Hovey Motorcars was presupposed to promote a person’s automobile in a consignment settlement however launched it to a fraudster. The dealership says the person’s insurance coverage should pay.
BOERNE, Texas — Felipe Villarreal purchased a bight orange 2020 Ford Mustang GT 500 again in 2022. He discovered it in a dealership in Las Vegas and paid greater than $90,000.
“It was type of my dream automobile. I at all times wished to get a automobile similar to that because it got here out. That exact colour they solely made like 400 of them,” Villarreal stated.
Sadly after the document inflation in 2022 and several other medical payments, Villarreal simply couldn’t justify the mortgage he nonetheless owed on the car. In October of 2023, Villarreal signed a cope with Hovey Motorcars in Boerne to do a consignment sale. Villarreal stated the dealership had been round for a few years and specialised in coping with “high-end” automobiles.
“Primarily based on their historical past, and dealing on these costly automobiles, I figured it was a great match,” Villarreal stated. “The automobile was parked within the showroom flooring as we agreed. There have been no check drives.”
Then, three weeks later, the dealership gave him a name. Villarreal stated he was informed they, “had excellent news and unhealthy information.”
In actuality, there was no excellent news. The automobile was gone. The dealership had given the automobile to a different celebration and had no cash to indicate for it.
“He informed me it was a fraudulent purchaser,” Villarreal stated.
Now, seven months later, the dealership nonetheless hasn’t paid Villarreal something in compensation.
KENS 5 reached out to Boerne PD and requested for the report on the fraud case to learn how it occurred. The Metropolis of Boerne determined to not present the report and requested the Texas Legal professional Common for an opinion as a substitute.
Rick Hovey Jr. despatched KENS 5 an announcement giving their aspect of the story. The assertion stated partially, “On 10-20-2023, a suspect made a $10,000 down cost on the automobile, obtained auto insurance coverage, and was subsequently authorised for a mortgage to finance the steadiness. 5 days after the down cost was made, and someday after the mortgage transaction was accomplished, Hovey Motorcars acquired a letter informing us that the down cost was made utilizing a stolen bank card. We instantly reported this to the Boerne Police Division. Regardless of our diligent efforts and our twenty-six years of enterprise expertise, we grew to become victims of theft and fraud on this occasion.”
Villarreal nonetheless does not perceive the way it might occur.
“I work actually arduous for what I’ve together with that automobile,” Villarreal stated. “For it to be taken so simply, it is simply baffling.”
Villarreal had already gone to the dealership and had anticipated that both his insurance coverage or the dealership’s insurance coverage would cowl the loss. The dealership stated Mr. Villarreal would wish to file a declare on his insurance coverage due to the contract he signed.
The contract states that Villarreal declared “to have in have an effect on full protection insurance coverage and acknowledge that I’m completely liable for all damages, repairs, and/or theft that may happen to stated auto.”
The dealership additionally informed KENS 5, “Sadly, our insurance coverage coverage doesn’t cowl the theft as we didn’t personal the car.”
In the meantime, Villarreal’s insurance coverage has a particular exception that states it doesn’t cowl consignment gross sales. He’s now left paying down a, roughly, $60,000 mortgage for a automobile he now not has.
“It appears like somebody hit you actually arduous within the intestine,” Villarreal stated.
However is Hovey Motorcars actually not legally responsibly for what occurred to Villarreal’s automobile? KENS 5 reached out to an insurance coverage professional and a client safety legal professional to seek out out.
Insurance coverage Council of Texas Communications Director Wealthy Johnson informed KENS 5 “full protection insurance coverage” doesn’t, the truth is, usually embody consignment protection.
“Full protection is usually a time period that concerned collision insurance coverage, legal responsibility insurance coverage and complete insurance coverage.,” Johnson stated. “Most insurance policies, typical insurance policies, are going to have exclusions for consignment.”
Johnson additional stated, “If you’re consigning a automobile it’s usually not lined in a typical insurance coverage coverage, together with complete.”
Client Safety Legal professional Invoice Clanton informed KENS 5, if the insurance coverage listed within the contract would usually not cowl this case, Villarreal might sue the dealership and declare the contract is imprecise.
“Mr. Villarreal’s argument can be that that is an ambiguous contract and the time period ‘full protection’ is imprecise. He would additionally argue that is neither harm, restore or theft. That is identification theft. That is fraud.”
The final distinction is vital as a result of the contract requires the seller be “held innocent” for harm and theft however doesn’t point out fraud.
Clanton stated the dealership can be open to a lawsuit due to one other authorized precept: bailment.
“It sounds lots like a bailment. A bailment is like if you examine your automobile at a valet: you give them your automobile and also you belief them with it.” Clanton stated.
Nonetheless, Clanton stated Villarreal would doubtless have to show that the dealership was negligent together with his property and would wish extra data to show that. He stated Villarreal would have a greater probability if he had a full police report detailing what occurred.
Villarreal continues to be ready for the Texas Workplace of the Legal professional Common to rule on whether or not Boerne PD can launch that report.
