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Wen Purchased an Automobile from Nick for $10,000

question 29

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Wen purchased an automobile from Nick for $10,000. Unknown to Wen, Nick had used the automobile as security for a loan from his bank, and the bank had registered its security interest in the automobile under the provincial personal property security registration legislation. A few months after the sale, Nick defaulted on the loan, and the bank discovered that Wen was in possession of the automobile. Wen has a good and clear title to the automobile, because he purchased it without knowledge of the bank's claim.

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