Sales and Leases of Personal Property Continued

I need help with a Business Law question. All explanations and answers will be used to help me learn.


Sheldon needed a car and decided to rent one from The Big Bang Rental Company. He used an alias, Leonard Hotstuff when he rented a 2015 Mustang on October 31, 2015. Sheldon really enjoyed driving the car and had many compliments on it. He decided that he was going to keep it and did not return the car. He obtained title to the car after he falsified signatures.

Within a month, Sheldon decided that he was going to sell the car. He placed an advertisement in the Chicago Tribune. Penny was in desperate need of a car and was looking through the want ads when she saw Sheldon’s listing. She asked her friend, Amy, what she thought of the advertisement and after a few hours decided to call the phone number listed in the ad. Sheldon answered the phone and talked with Penny about the car’s condition. He told her that he would meet her at her house, but they eventually decided to meet at the Fine N Dine fast food place located two blocks from Penny’s house for inspection.

Amy and Penny went the next day and viewed the car. Penny loved it, especially the color, and decided she was going to buy it from Sheldon for $11,500 in cash. Sheldon transferred title, which was in the name of S. Cooper Enterprises. Penny enjoyed driving her car around and made some improvements to it. She registered the car in Indiana.

Around December 15, 2015, The Big Bang Rental Company reported the car stolen. The Department of Motor Vehicles seized the car from Penny and returned it to The Big Bang Rental Company. Penny sued the Big Bang Rental Company. Who prevails and why?