Sunday, April 28, 2013

Kotis v. Nowlin Jewelry, Inc. case brief

Kotis v. Nowlin Jewelry, Inc. case brief summary
844 S.W.2d 920

CASE SYNOPSIS: Appellant buyer challenged a judgment of County Court at Law No. 2 and Probate Court of Brazoria County, Texas, that declared that appellee seller was the sole owner of a watch and awarded appellee attorney fees in appellee's action for a declaratory judgment that appellee was the sole owner. The trial court denied appellant's counterclaim for a declaration that he was a good faith purchaser under Tex. Bus. & Com. Code Ann. § 2.403(a).

FACTS: Appellant buyer purchased a watch from a thief who had obtained it from appellee seller with a forged check. The trial court rendered judgment, declaring that appellee was the sole owner of the watch and denied appellant's counterclaim contending that he was a good faith purchaser under Tex. Bus. & Com. Code Ann. § 2.403(a).

HOLDING:
In affirming, the court found that the thief induced appellee to deliver the watch to him voluntarily, so the trial court erred in finding that the thief did not receive the watch through a transaction of purchase under § 2.403(a).

ANALYSIS:
The thief had a voidable, rather than a void title to the watch. Further, while a transferor with voidable title can transfer good title to a good faith purchaser under § 2.403(a), the test for good faith is the actual belief of the buyer. The evidence showed that appellant was familiar with the price of the watch, knew that he was buying it at an unreasonably low price, and had lied several times to appellee. Thus there was evidence supporting the trial court's finding that appellant did not act in good faith. Finally, attorney fees were proper under the Declaratory Judgment Act, Tex. Civ. Prac. & Rem. Code Ann. § 37.009.

CONCLUSION: The trial court's judgment declaring that appellee seller was the sole owner of a watch and awarding attorney fees to appellee was affirmed because there was evidence supporting the trial court's finding that appellant buyer did not act in good faith when he purchased the watch from a thief who had a voidable title.

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