The firm’s client entered into a sales agreement for the purchase of a car with someone holding themselves out as an agent of a used car dealership. While the client had never been to the dealership, he believed the seller was its agent based on the seller’s representations and having observed the seller purchase and repair salvaged cars on behalf of the dealership. After making full payment the client received the car but did was not given title. Eventually becoming suspicious of the seller, the client called the dealership to demand title be delivered. The dealership declared the seller was not its agent and that the car would be reported stolen if not returned immediately. Shortly after, the client received a telephone call from someone claiming to be a police officer and threatening arrest if the car was not returned immediately. Before the lawsuit was filed the seller disappeared and has not since been found.
At trial, Corey argued the dealership was responsible for the acts of the seller because it had entrusted him with enough responsibility to create an impression in the public that the seller had authority to sell cars on behalf of the dealership. The jury agreed. Additionally, Corey presented evidence that the phone call from the alleged police officer was in fact an employee of the dealership. Again the jury agreed and, on this point, were persuaded the defendant dealership’s fraudulent acts justified punitive damages. The case settled before the punitive damages phase.