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Supreme Court rules used-car lot can’t just tow your car and sell it

May 13, 2013

The vehicle recovery industry often suffers unnecessary abuse for its works; most of its tradespeople strive for honesty and offer help to those in need. Here's the case of one tow truck service from the other side of the ledger, which pursued a case to the U.S. Supreme Court arguing it had done nothing wrong in hooking a disabled man's car and later trading it while hiding its acts from him. Today, it managed to unite nine justices who rarely agree on much to throw its case out.

The car, a 2004 Honda Civic with just 8,000 miles on it, belonged to Robert Pelkey of New Hampshire. In February 2007, Pelkey was bedridden when Dan City's Used Cars towed his Civic from his apartment complex's parking lot because he was unable to move it before a snowstorm. Pelkey ended up in the hospital for two months, where he suffered a heart attack and had to have his foot amputated; he didn't realize his car had been towed until he was released.

When his lawyer called Dan's City to ask for Pelkey's Civic back, Dan's City told him it would be sold at auction two days later. The lawyer told Dan's City of Pelkey's troubles, but the tow company sent it to auction anyway — and when it didn't sell, it falsely told Pelkey's lawyer it had. Dan's City later traded the car and never paid Pelkey.

Pelkey sued under New Hampshire law for damages, and Dan's City found an unusual defense: It argued that a 1994 federal law deregulating the trucking industry blocked such claims because it overruled state laws "related to a price, route, or service of any motor carrier . . . with respect to the transportation of property." A lower state court found for Dan's City; the New Hampshire Supreme Court overruled, and the U.S. Supreme Court took the case to settle the question.

In a unanimous decision, the court sided with Pelkey, saying the federal law in question involved transportation, not storage, and that Dan's City couldn't say state law gave it the right to sell Pelkey's car but not the responsibility to warn him. Pelkey will now have to file a whole new suit to win any damages, but his case has given everyone who's ever been wronged by a towing company a bit of Civic justice.

Photo: Irina Souiki via Flickr