Toyota Motor Credit Corp. v. C.L. Hyman Auto Wholesale, Inc
In Toyota Motor Credit Corp. v. C.L. Hyman Auto Wholesale, Inc., 256 Va. 243, 506 S.E.2d 14 (Va. 1998), a vehicle owner applied to the Virginia Department of Motor Vehicles (DVM) for a duplicate certificate of title and fraudulently represented that Toyota's security interest had been released.
The DVM thereafter issued a new title showing no lienholder and the debtor subsequently sold the car to a bona fide purchaser for value. Id. at 15.
Recognizing the usual rule that a security interest must appear on the face of the title, the court held that where there are two innocent parties, the bona fide purchaser for value was entitled to take free of the unrecorded security interest. Id. at 16.