Simple English definitions for legal terms
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Floor-Plan Rule: If you put your car up for sale in a dealership, you can't later say that you didn't sell it if the dealership sells it to someone else who didn't know it wasn't yours to sell.
Definition: The floor-plan rule is a principle that states that if a vehicle owner puts their vehicle up for sale in a retail dealer's showroom, they cannot deny the title of an innocent purchaser who buys the vehicle from the dealer in the normal course of retail business.
For example, let's say John owns a car dealership and he buys a car from Jane to sell in his showroom. John pays Jane for the car and puts it up for sale. A few days later, Sarah comes into the dealership and buys the car from John. Later, Jane tries to claim that she still owns the car and wants it back. However, because of the floor-plan rule, Jane cannot deny Sarah's ownership of the car because Sarah bought it from John in the normal course of retail business.
The floor-plan rule is designed to protect innocent purchasers who buy vehicles from dealerships. It ensures that if a vehicle is put up for sale in a dealership, the owner cannot later claim that they still own the vehicle and take it back from the purchaser.