Securities – Rights of Used Car Purchasers Under Trust Receipt Financing
The recent enactment of the Uniform Trust Receipts Act: by the Michigan legislature was an important and much needed revision in the Michigan law of chattel security. Although the UTRA has been referred to as a ” . . . perplexing maze of technical phrases … ,” it is submitted that the act contains a clear presentation of the changes which are to be effected, and should go far in freeing the financing of goods in the flow of commerce from some anachronistic shackles. The particular intent of this comment is to explore the impact of the UTRA and other recent legislation on the position of purchasers of used cars in the ordinary course of business. It is in this narrow field that the consumer seems most in jeopardy because of the effects of the Certificate of Title Act. Therefore, there will be only slight coverage of the effect of the UTRA on the financing of new cars, and no attempt to explore the financing of other goods, documents, or instruments. Since the UTRA specifically excludes from its operation the financing of purchases by the ultimate consumer, there will likewise be no coverage of the conditional sale contract.