Cengage Advantage Books: Law for Business 18th Edition by John Ashcroft ,Janet Ashcroft

Exercise 27

Steve Morell sold a used tractor to James Tracy for $12,500, and Tracy signed a promissory note agreeing to make monthly payments. After Tracy heard that Morell had been arrested for receiving stolen farm equipment, he stopped making payments and asked the sheriff to find out whether the tractor he had bought was stolen. The tractor's identification number had been altered, so the only way to determine whether the tractor was stolen was to dismantle it to find the valid number in the engine. The prosecutor found the cost of doing so was prohibitive. A tractor with an altered identification number had could not be knowingly or intentionally sold legally. Tracy sued Morell, and Morell counterclaimed for the balance due on the note. Should Tracy be able to rescind the sale? [Tracy v. Morell, 948 N.E.2d 855 (Ind. Ct.App.)]