Caveat Emptor: $123k Horse Trailer Purchase Goes Very, Very Wrong

Thinking about borrowing over $123,000 to buy a living quarters horse trailer? The case of John Michael Blake and Keith Blake v. GE Money Bank is an illustration of all the reasons you should do due diligence before you drop that kind of cash on a horse trailer.

John Michael and Keith Blake borrowed $123,173.16 from GE Money Bank to buy a horse trailer from a dealer called Southwestern Conversions. According to court filings, the dealer prepared a lien and application for title, but never actually applied for the title or license plate on the trailer.  John Michael and Keith allege they found out their title had not been properly secured, and advised GE Money Bank of this fact.  According to the Blakes, GE Money Bank said they were working out those issues with the dealer and not to worry.

About nine months later, the Blakes decided to sell the trailer through Southwestern Conversions, the same dealer they had bought the trailer from (and the same one who seemed to have botched the title application...). The trailer sold for $60,000 (a considerable loss, so it seems), but Southwetern Conversions apparently kept the $60,000 it received for the Blakes' trailer, then filed for bankruptcy. 

Today there are some ads for trailers for sale on HorseClicks.com from Southwestern Conversions, but all of them say "Status: Unavailable".  I did find a good customer review of Southwestern Coversions from 2008 online.

The Blakes never got title to the trailer and it was now gone and they still owed payments on it to GE Money Bank.  And they had been making all their payments on time before they sold the trailer.  What a mess.  The Blakes sued GE Money Bank after the bank failed to credit their loan for the $60,000, alleging that the bank didn’t properly assist them in securing title. 

Without doing a lot of research, I can't report the current status of this case.  I can say that it was pending in the Western District of Texas (federal court in Texas) under Cause No. AS-10-CV-860-XR, but my review of the docket on PACER indicates that United States District Judge Xavier Rodriguez ordered the case remanded to the 38th District Court of Medina County, Texas on June 27, 2011. 

Hat tip to Krysia Nelson at Equine Law & Business Letter for noticing this case first.

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DOT Says it Will Not Adopt Regulation Requiring CDL for Farmers & Ranchers

Over the past few weeks, many agriculture associations have expressed concern that the US Department of Transportation (DOT) had proposed a regulation that would require farmers and ranchers to get a commercial driver's license (CDL) in order to, for example, drive tractors on public roads or haul livestock on public roads with a truck/trailer combo exceeding 26,000 pounds.

Ohio Agricultural Law Blog and Brownfield Ag News reported earlier this week that the stories concerning the pending DOT regulation were just “rumors” and that the DOT never proposed a law requiring farmers and ranchers to get a CDL. 

I researched this issue breifely and so far have not been able to locate a copy of any proposed DOT rule on the agricultural CDL topic.  If you have a copy, please let me know.   Regardless of whether or not a rule was actually proposed or pending, my research indicates that the DOT clearly did ask for public comment on the subject of whether current CDL agricultural exemptions existing under state law were appropriate. 

The DOT's request for public comment, Docket No. FMCSA-2011-0146, can be found here.    

According to several stories, the public had until the extended deadline of  August 1, 2011 to submit comments to the DOT on this issue. According to DOT, the agency received about 1,700 comments from the agricultural community and members of Congress. 

According to this DOT press release from August 10, 2011:

No regulations will be proposed for any new safety requirements or changes to the rules governing the transport of agricultural products, farm machinery, or farm supplies to or from a farm.”

Regardless of whether the proposed CDL regulation was just a rumor, this news is certainly a relief for Texas farmers and ranchers as well as horse owners who pull large horse or stock trailers.

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