Ask Me Help Desk - Stolen vehicle, my liability

My husband leased a vehicle under his name shortly after we were married. Towards the end of the marriage, I secured a loan through a credit union and paid the vehicle off. The original title and paperwork were sent to my husband, who refused to transfer the title into my name. Subsequently, the car was stolen on 09/05/06. The insurance company refused to pay the claim as I could not get the title from my estranged husband. I tried, without avail, to get this title since I purchased the vehicle in 2005. Subsequently, the car was recovered in California (where it was stolen) and in an impound lot. No one was able to check the car out because I was not the registered owner. My husband finally transferred the title in April 2007 and the credit union is suing me for the loan. What are my rights? The credit union was never in possession of the title for the entire 2 years that I was paying on the car loan but now they are demanding that I pay for a car that I no longer have. No one would help me get the title from my husband and in the 6 months the car was missing, I had to get another vehicle and am paying on that. Am I legally obligated to pay for a car that was stolen, recovered and left in California even though I am not at fault?

I think you need to consult an attorney on this one. My gut feeling is that you may have a lawsuit against your husband for not transferring title to you (assuming it was part of the divorce agreement). You might have a claim against the insurance company if they issued a policy on the car and accepted premiums from you for it.

But you do owe the credit union. You borrowed money and agreed to pay it. Its irrelevant to them what you borrowed the money for what happened to it. If the insurance company pays on the stolen car claim, then you would have had to use that to pay off the loan anyway.

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Originally Posted by ScottGem

I think you need to consult an attorney on this one. My gut feeling is that you may have a lawsuit against your husband for not transferring title to you (assuming it was part of the divorce agreement). You might have a claim against the insurance company if they issued a policy on the car and accepted premiums from you for it.

But you do owe the credit union. You borrowed money and agreed to pay it. Its irrelevant to them what you borrowed the money for what happened to it. If the insurance company pays on the stolen car claim, then you would have had to use that to pay off the loan anyway.

I am still married and have yet to settle on the terms of the divorce. I am unable to afford another attorney in regards to the divorce or the car so what else can I do? I can't imagine that I would be stuck with this car payment when my husband refused to cooperate with the credit union, the insurance company or with me. This is a nightmare!

The insurance company did issue the policy on the car without me being the registered owner and gladly accepted my premium payments. But when it came to paying the claim, the insurance company refused as I could not send them the title. The title was the only thing holding up the payment. How do I sue the insurance company?

Talk to your divorce attorney get their advice. If his refusal was a result of the divorce then you may, as I suggested, have a cause of action against him.

But, again, you borrowed the money you have to pay back the money. The theft, insurance issues, etc. have no bearing on that. The only bearing they have is that the insurance should have paid on the theft claim, so you could have then use that money to pay the balance. But that's not the credit union's concern. So, you have to get someone to help you pay off the credit union. That someone could be your husband since his refusal to transfer title was a cause of the insurance company not honoring the claim. Or it could be the insurance company since, once they issued a policy, then should pay on it.

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Originally Posted by katiej

The insurance company did issue the policy on the car without me being the registered owner and gladly accepted my premium payments. But when it came to paying the claim, the insurance company refused as I could not send them the title. The title was the only thing holding up the payment. How do I sue the insurance company?

Depends on the amount. You may be able to use small claims court, otherwise you have to file suit in civil court. If they were waware the title was not in your name. Then they have no right to refuse payment. Of course there is a kicker here that the car was found. Since that is the case, they may get out of paying that way.