FOR PUBLICATION

ATTORNEY FOR APPELLANT:                       ATTORNEYS FOR APPELLEE,
                                              Indiana Bureau of Motor Vehicles:
GREGORY W. BLACK
The Black Law Office                          GREGORY F. ZOELLER
Plainfield, Indiana                           Attorney General of Indiana

                                              ELIZABETH ROGERS
                                                                              FILED
                                                                            Dec 28 2012, 9:48 am
                                              Deputy Attorney General
                                              Indianapolis, Indiana                 CLERK
                                                                                  of the supreme court,
                                                                                  court of appeals and
                                                                                         tax court

                                              ATTORNEY FOR APPELLEE,
                                              Donald Gindelberger:

                                              NORMAN L. BURGGRAF, JR.,
                                              Elkhart, Indiana


                            IN THE
                  COURT OF APPEALS OF INDIANA
JAMES M. BRINKLEY,                            )
STEPHANIE L. BRINKLEY,                        )
                                              )
     Appellants-Plaintiffs,                   )
                                              )
            vs.                               )    No. 32A01-1204-MI-181
                                              )
MICHAEL HALUSKA, P.E., d/b/a                  )
RETRO TECH, et al.,                           )
                                              )
     Appellees-Defendants.                    )


                  APPEAL FROM THE HENDRICKS SUPERIOR COURT
                          The Honorable Mark A. Smith, Judge
                             Cause No. 32D04-0911-MI-28

                                   December 28, 2012

                              OPINION - FOR PUBLICATION

BARNES, Judge
                                     Case Summary

      James Brinkley III and Stephanie Brinkley (collectively, the “Brinkleys”) appeal

the trial court’s judgment for the State of Indiana by its Bureau of Motor Vehicles

(“BMV”) and Donald Gindelberger in their action against the BMV, Gindelberger,

Michael Haluska, d/b/a Retro Tech, Retro Tech Auto Restoration, Inc., (collectively,

“Haluska”), and Mechanic’s Lien Plus, Inc. We affirm.

                                          Issues

      The Brinkleys raises several issues, which we restate as:

            I.      whether the trial court properly granted summary
                    judgment to Gindelberger because he was a bona fide
                    purchaser for value; and

           II.      whether the trial court properly granted judgment on
                    the pleadings to the BMV because the BMV was
                    entitled to immunity.

                                          Facts

      In May 2005, James was issued a certificate of title for a 1965 Chevrolet Corvette.

In September 2006, the Brinkleys entered into a contract with Haluska for the restoration

of the vehicle for $12,500 plus parts and additional expenses.         Haluska is in the

automotive restoration business, not in the business of selling vehicles. The Brinkleys

paid Haluska $10,317 and spent $6,000 on parts and incidentals. However, the parties

eventually had a disagreement about Haluska’s work and the amount of money the

Brinkleys still owed. In November 2008, Haluska, who still had possession of the

vehicle, threatened to file a mechanic’s lien on the vehicle if the Brinkleys failed to pay



                                            2
an additional $1,500. The parties continued arguing about the vehicle and Haluska’s

work.

        Haluska apparently hired Mechanic’s Lien Plus to file a lien on the vehicle. On

July 24, 2009, Mechanic’s Lien Plus sent a certified notice to James at a residence on

Victoria Drive in Indianapolis, which is the address listed on the BMV’s title records for

the vehicle and is the address of James’s father. James, however, lives at a residence on

East 75th Street in Indianapolis. The notice provided that the vehicle would be sold at a

public auction on August 28, 2009, if James did not recover the vehicle by paying

charges of $7,400. James did not receive the notice of the sale. The certified notice was

marked “return to sender, no such number, unable to forward” and was returned. App. p.

195. Mechanic’s Lien Plus advertised the sale in an Indianapolis newspaper on July 25,

2009, through July 31, 2009. At the August 28, 2009 auction, Haluska purchased the

vehicle for $100. However, for unknown reasons, Mechanic’s Lien Plus sent a second

certified notice to James at the Victoria Drive address on November 10, 2009, and James

did receive this notice. The second notice stated that the vehicle would be sold at public

auction on November 16, 2009, if James did not pay the charges.

        On November 20, 2009, the Brinkleys filed a complaint for injunctive relief and

damages against Haluska. They requested injunctive relief to bar the sale of the vehicle

and to regain possession of the vehicle. On the same day, Haluska filed an application

for certificate of title with the BMV regarding the vehicle.      Haluska stated on the

application that he purchased the vehicle on August 28, 2009, for $100. On November



                                            3
23, 2009, the BMV issued a certificate of title to Haluska for the vehicle. Haluska was

served with the Brinkleys’ complaint on December 3, 2009.

         Haluska then listed the vehicle for sale on eBay. Gindelberger had substantial

experience on eBay and had purchased ten to fifteen other vehicles on eBay.              On

December 13, 2009, Gindelberger bid $25,100 on the vehicle and was the winning

bidder. Gindelberger requested and received the certificate of title showing Haluska as

the owner. Gindelberger did not examine the Hendricks County court records prior to

purchasing the vehicle. The vehicle was delivered to Gindelberger on December 14,

2009, and Gindelberger paid Haluska.

         After a December 17, 2009 preliminary hearing, the trial court granted the

injunction, ordered Haluska not to transfer title or deliver a signed title to the vehicle to

any third party, and ordered the BMV not to issue a new title to the vehicle until further

order.    On December 18, 2009, the Brinkleys filed an amended complaint, and on

December 30, 2009, they filed a second amended complaint, adding claims against the

BMV, eBay, and Gindelberger. The amended complaint alleged that Gindelberger was

“not a bona fide purchaser for value without notice.” Id. at 50. It also requested

injunctive relief against the BMV to prevent the transfer of title. Gindelberger then filed

a cross-claim against Haluska. On May 10, 2010, the Brinkleys filed a tort claims notice

against the BMV and/or the State of Indiana.

         In August 2010, the Brinkleys filed a motion for partial summary judgment

against Gindelberger. In September 2010, Gindelberger filed a response to the motion

for partial summary judgment and also filed a cross-motion for partial summary

                                             4
judgment. On October 4, 2010, the Brinkleys filed a response to Gindelberger’s cross-

motion for partial summary judgment.       The Brinkleys also filed a third amended

complaint against Haluska, Retro Tech, the BMV, Gindelberger, and Mechanic’s Lien

Plus, in which the Brinkleys sought damages for breach, fraud, theft, and an injunction

against Haluska and damages for negligence against Mechanic’s Lien Plus.

      On October 27, 2010, the Brinkleys filed a “Hearing Brief.” Id. at 11. After an

October 27, 2010 hearing on the motion for summary judgment, the trial court concluded

that Indiana Code Section 26-1-2-403(2) and Indiana Code Section 26-1-2-403(3) were

inapplicable because Haluska was not in the business of selling Corvettes. However, the

trial court concluded that Indiana Code Section 26-1-2-403(1) was applicable because

Gindelberger was a good faith purchaser for value. The trial court granted summary

judgment to Gindelberger and also apparently struck the Brinkleys’ Hearing Brief.

      In July 2011, the BMV filed a motion for judgment on the pleadings. The BMV

argued that it was entitled to immunity pursuant to Indiana Code Section 34-13-3-3. The

Brinkleys filed a response, arguing that the BMV improperly issued a certificate of title

to Haluska because the notice to the Brinkleys was not proper or timely. After a hearing,

the trial court granted the BMV’s motion for judgment on the pleadings.

      In February 2012, a bench trial was held with the remaining parties, and the trial

court entered judgment in favor of the Brinkleys and against Haluska, Retro Tech, and

Mechanic’s Lien Plus. On March 1, 2012, the Brinkleys filed a motion to correct error

regarding the summary judgment for Gindelberger and the judgment on the pleadings for

the BMV, which the trial court denied. The Brinkleys now appeal.

                                           5
                                         Analysis

                            I. Claim against Gindelberger

      The Brinkleys argue that the trial court improperly granted summary judgment to

Gindelberger because he was not a good faith purchaser for value. Summary judgment is

appropriate when there is no genuine issue of material fact and the moving party is

entitled to judgment as a matter of law. Ind. Trial Rule 56. We liberally construe all

designated evidentiary material in a light most favorable to the non-moving party to

determine whether there is a genuine issue of material fact. Bradshaw v. Chandler, 916

N.E.2d 163, 166 (Ind. 2009). The party that lost in the trial court has the burden of

persuading the appellate court that the trial court erred. Id. Our review of a summary

judgment motion is limited to those materials designated to the trial court. Mangold v.

Ind. Dep’t of Natural Res., 756 N.E.2d 970, 973 (Ind. 2001).

      Legal title to a vehicle is governed by the sales provisions of the Uniform

Commercial Code (“UCC”) rather than the Indiana Certificate of Title Act. Marlow v.

Conley, 787 N.E.2d 490, 496-97 (Ind. Ct. App. 2003). Thus, the issue is whether

Gindelberger obtained good title to the vehicle from Haluska pursuant to Indiana Code

Section 26-1-2-403(1), which provides:

             A purchaser of goods acquires all title which the purchaser’s
             transferor had or had power to transfer, except that a
             purchaser of a limited interest acquires rights only to the
             extent of the interest purchased. A person with voidable title
             has power to transfer a good title to a good faith purchaser for
             value. When goods have been delivered under a transaction of
             purchase, the purchaser has such power even though:



                                            6
               (a)     the transferor was deceived as to the identity of the
                       purchaser; or

               (b)     the delivery was in exchange for a check which is later
                       dishonored; or

               (c)     it was agreed that the transaction was to be a “cash
                       sale”; or

               (d)     the delivery was procured through fraud punishable as
                       theft under the criminal law.

We noted in Marlow, 787 N.E.2d at 493, that, under Indiana Code Section 26-1-2-403(1),

a defrauding buyer obtains voidable title and has the power to transfer good title to a

good faith purchaser for value. The Brinkleys do not dispute that Haluska had voidable,

rather than void, title. Their only argument is that Gindelberger was not a good faith

purchaser for value.

        “Good faith” is defined as “honesty in fact and the observance of reasonable

commercial standards of fair dealing.”1 Ind. Code § 26-1-1-201(19). We addressed the

good faith purchaser for value requirements in Marlow, 787 N.E.2d at 495-99. There,

Conley sold a truck to the Medleys at a car show. Conley claimed that he owned a car

lot. When Conley gave the Medleys the certificate of title, Marlow was listed as the

truck’s owner, and Conley assured the Medleys that “Marlow had signed the title as part

of a deal Conley made with him.” Marlow, 787 N.E.2d at 491. The Medleys then

applied for a certificate of title in their name. Marlow later filed a complaint against

Conley and the Medleys and alleged that Conley had stolen the vehicle. At the trial,


1
  This statute was amended in 2009. See Pub. L. No. 135-2009, § 1 (eff. July 1, 2009). It previously
read: “ʻGood Faith,’ means honesty in fact in the conduct or transaction concerned.”
                                                 7
evidence was presented that Marlow told the police he had a business deal with Conley

involving the sale of the truck to Conley but that Conley failed to perform his end of the

deal. As between the Medleys and Marlow, the trial court entered judgment for the

Medleys.

       On appeal, we affirmed, holding that the Medleys were good faith purchasers for

value under Indiana Code Section 26-1-2-403(1). Marlow’s only argument was that the

Medleys did not purchase the truck in good faith because the certificate of title was

signed by Marlow, not Conley. We noted that Conley had failed to comply with the

statutory requirements by selling the truck to the Medleys without first transferring the

title to his own name. However, we held that the Medleys’ failure to demand a proper

certificate of title did not affect their status as good faith purchasers. Although the failure

to comply with the statutory requirements regarding the certificate of title “may,

combined with other suspicious circumstances, raise questions about a purchaser’s good

faith,” we found no such other circumstances. Id. at 497-98. We also noted the purpose

of Indiana Code Section 26-1-2-403(1), which was intended to determine the priorities

between the two innocent parties:

              (1) the original owner who parts with his goods through
              fraudulent conduct of another and (2) an innocent third party
              who gives value for the goods to the perpetrator of the fraud
              without knowledge of the fraud. By favoring the innocent
              third party, the Uniform Commercial Code endeavors to
              promote the flow of commerce by placing the burden of
              ascertaining and preventing fraudulent transactions on the one
              in the best position to prevent them, the original seller.




                                              8
Id. at 498 (quoting Mowan v. Anweiler, 454 N.E.2d 436, 439 (Ind. Ct. App. 1983)).

“The policy behind the UCC is to favor the Medleys because, as between the Medleys

and Marlow, Marlow was in the best position to prevent the fraudulent transaction.” Id.

We concluded that the Medleys were good faith purchasers for value. Thus, Conley, as a

defrauding buyer, possessed voidable title and transferred good title to the Medleys as

good faith purchasers for value.

       Here, according to the Brinkleys, Gindelberger was not a good faith purchaser

because he had constructive notice of their lawsuit against Haluska, which was already in

progress when Haluska sold the vehicle on eBay. In support of their constructive notice

argument, the Brinkleys rely on cases involving real estate transactions. For example, in

the real estate context, a purchaser is presumed to have examined the records in the chain

of title and is charged with actual or constructive notice of all such properly recorded

instruments. See Bank of New York v. Nally, 820 N.E.2d 644, 648-49 (Ind. 2005).

Further, lis pendens notices provide constructive notice of pending lawsuits that affect an

interest in real estate. See Clarkson v. Neff, 878 N.E.2d 240, 243 (Ind. Ct. App. 2007),

trans. denied.   “If a lis pendens notice is properly filed on the public records, a

subsequent purchaser will take the property subject to a judgment in the pending claim.”

Id. at 244 (quoting MDM Inv. v. City of Carmel, 740 N.E.2d 929, 934 n.3 (Ind. Ct. App.

2000)). However, we do not find the Brinkleys’ argument persuasive. There is no “lis

pendens notice” for automobiles, and the Brinkleys cite no authority requiring

Gindelberger to search pending litigation records prior to purchasing a vehicle. Likewise,

our research reveals no such requirement.

                                            9
        The Brinkleys also argue that Gindelberger failed to “get to know” Haluska as

recommended by eBay. Prior to buying an automobile through an eBay auction, eBay

recommends that a purchaser should “[g]et to know your seller,” check the seller’s

“Feedback rating,” and contact “the seller with any questions.” App. p. 115. Haluska

had a 100% positive feedback rating. The Brinkleys do not explain how “getting to

know” Haluska was required to obtain status as a good faith purchaser.                             eBay’s

recommendations are just that—recommendations.

        We conclude that the trial court properly found Gindelberger to be a good faith

purchaser for value. As in Marlow, between the Brinkleys or Gindelberger, the Brinkleys

were in the best position to prevent this allegedly fraudulent transaction.                      Because

Gindelberger was a good faith purchaser for value, Haluska transferred good title to him.

The trial court properly granted summary judgment to Gindelberger.2

                                          II. Claim against BMV

        Next, the Brinkleys argue that the trial court erred by granting the BMV’s motion

for judgment on the pleadings. We review de novo a trial court’s ruling on a Trial Rule

12(C) motion for judgment on the pleadings. Murray v. City of Lawrenceburg, 925

N.E.2d 728, 731 (Ind. 2010). We accept as true the well-pleaded material facts alleged in

the complaint, and base our ruling solely on the pleadings. Id. “A Rule 12(C) motion for

judgment on the pleadings is to be granted ‘only where it is clear from the face of the


2
  The Brinkleys also briefly argue that the trial court abused its discretion by striking its hearing brief,
which was filed on the day of the summary judgment hearing. Even assuming the trial court erred
though, the Brinkleys have not shown that their substantial rights were affected. See Ind. Trial Rule 61.
Even if we consider the Brinkleys’ hearing brief, we still conclude that the trial court properly granted
summary judgment to Gindelberger.
                                                    10
complaint [and answer] that under no circumstances could relief be granted.’”                Id.

(quoting Forte v. Connerwood Healthcare, Inc., 745 N.E.2d 796, 801 (Ind. 2001)).

       According to the Brinkleys, the BMV improperly issued a certificate of title for

the vehicle to Haluska. The Brinkleys contend that the BMV should have been aware

that the Brinkleys did not receive proper notice of the auction and that the BMV acted

arbitrarily. The BMV argues that it is entitled to immunity pursuant to the Indiana Tort

Claims Act (“ITCA”) for issuing the certificate of title.

       “ʻA traditional formulation of tort liability requires the plaintiff to establish a duty,

breach of that duty, proximate cause, and damages.’” Gary Cmty. Sch. Corp. v. Roach-

Walker, 917 N.E.2d 1224, 1225 (Ind. 2009) (quoting 1 Dan B. Dobbs, The Law of Torts

§ 114, at 269 (2001)). “Immunity trumps all of these and bars recovery even where

ordinary tort principles would impose liability.” Id. “Thus, for example, the government

and its employees are immune from liability for the ‘initiation of a judicial or an

administrative proceeding,’ even if the action was taken in breach of a duty to act

competently and in the public interest.” Id. at 1225-26 (quoting I.C. § 34-13-3-3(6)

(2008)). Whether an immunity applies is a matter of law for the courts to decide. Id. at

1226. The party seeking immunity bears the burden of establishing the immunity. Id.

       The ITCA provides that governmental entities may be liable for torts committed

by their agencies and employees. Flynn v. Indiana Bureau of Motor Vehicles, 716

N.E.2d 988, 990 (Ind. Ct. App. 1999), trans. denied. However, the ITCA protects

governmental entities from liability if the tortious conduct falls within certain statutorily

enumerated exceptions found in Indiana Code Section 34-13-3-3, which provides, in part:

                                              11
              A governmental entity or an employee acting within the scope
              of the employee’s employment is not liable if a loss results
              from the following:

                                           *****

              (11) The issuance, denial, suspension, or revocation of, or
              failure or refusal to issue, deny, suspend, or revoke any
              permit, license, certificate, approval, order, or similar
              authorization, where the authority is discretionary under the
              law.

The BMV argues that, pursuant to Indiana Code Section 34-13-3-3(11), it is entitled to

immunity because the issuance of the certificate of title was discretionary.

       We addressed a similar issue in Flynn, 716 N.E.2d at 991-92. There, Flynn

purchased a vehicle and applied to the BMV for a certificate of title, which the BMV

issued. The vehicle was later confiscated because it was stolen. Flynn filed an action

against the BMV, arguing that it negligently issued the certificate of title. The BMV

moved for summary judgment, arguing that it was immune from liability under the ITCA,

and the trial court granted summary judgment to the BMV.

       On appeal, we affirmed the trial court’s order. We noted, in part, that Indiana

Code Section 9-17-2-10 provides: “If the bureau is satisfied that the person applying for a

certificate of title is the owner of the vehicle, the bureau may issue a certificate of title for

the vehicle.” Id. at 991. The “[u]se of the term ‘may’ ordinary connotes discretion.” Id.

Accordingly, we concluded that “the issuance of certificates of title by the BMV is




                                               12
discretionary within the meaning of IC 34-13-3-3(10)[3] in absence of other indications to

the contrary.” Id.

          Flynn relied on other statutory provisions to argue that the BMV did not have such

discretion. Flynn relied, in part, on Indiana Code Section 9-17-2-8, which provided that

the BMV “shall use reasonable diligence in determining if the facts stated in an

application for a certificate of title are true.” Id. We rejected that argument and held “the

BMV may not exercise this discretion arbitrarily, and a person may seek judicial review

of an agency action that constitutes an abuse of discretion.” Id. at 992 (citing I.C. § 4-

21.5-5-14(d)(1)). Further, “the fact that the BMV is required to exercise diligence in

determining the truth of the fact stated in an application is consistent with the idea that

the BMV may not act arbitrarily.” Id. We concluded that the BMV was immune from

liability for losses resulting from the issuance or denial of a certificate of title, and the

trial court properly granted summary judgment.

          The Brinkleys argue that, regardless of Indiana Code Section 9-17-2-10, the BMV

lacked such discretion due to Indiana Code Section 9-22-5-15(i), which, at the time of the

issuance of the certificate of title, provided:

                  A person who holds a mechanic’s lien under this section shall
                  execute and deliver to the purchaser of a vehicle under this
                  section a sales certificate in the form designated by the
                  bureau, setting forth the following information:

                  (1)    The facts of the sale.

                  (2)    The vehicle identification number.


3
    See now Ind. Code § 34-13-3-3(11).
                                                  13
              (3)    The certificate of title if available.

              (4)    A certificate from the newspaper showing that the
                     advertisement was made as required under subsection
                     (d).

              Whenever the bureau receives from the purchaser an
              application for certificate of title accompanied by these items,
              the bureau shall issue a certificate of title for the vehicle
              under IC 9-17.

I.C. § 9-22-5-15 (repealed by Pub. L. No. 125-2012, § 155 (eff. July 1, 2012) (emphasis

added); see now I.C. § 9-22-1-21.5(i). Although Indiana Code Section 9-22-5-15 used

the word “shall,” it also required that the BMV issue the certificate of title under Indiana

Code Article 9-17, which includes Indiana Code Section 9-17-2-10. Again, that statute

gives the BMV discretion to issue a certificate of title.

       The Brinkleys also focus on our holding that the BMV may not exercise its

discretion “arbitrarily,” but they ignore the remainder of the holding, which is that the

aggrieved person may seek judicial review—not file an action for negligence, which is

the route attempted by the Brinkleys. Contrary to the Brinkleys’ argument, we find little

to differentiate this case from Flynn. Consequently, we conclude that the BMV is

immune from liability pursuant to the ITCA, and trial court properly granted the BMV’s

motion for judgment on the pleadings.

                                         Conclusion

       The trial court properly granted summary judgment to Gindelberger, and the trial

court properly granted the BMV’s motion for judgment on the pleadings. We affirm.




                                              14
      Affirmed.

VAIDIK, J., and MATHIAS, J., concur.




                                       15
