Russel is a boat repair guy. His business is repairing boats. He owns a 19 foot Kinsvater boat. (This boat has no physical title). He writes a contract with a guy named Klouser whereby:

Klouser will pay $5400 for the boat;

Klouser will pay $1700 down;

Russel will fix the engine and drive train, and then;

Klouser will pay the balance and pick up the boat.

Before Russel begins work on the boat a storm rolls in and the boat is smashed against a see wall and destroyed.

Russel puts in a claim for this boat with his insurance company, Trans America. Russel policy is for water craft, 26 feet or less, not owned by Russel (Remember he is a boat repair guy so he needs a policy that covers other peoples boats in his possession.Trans America denies the claim saying Russel still had title to the boat, so it is not covered.

Who has title to the boat?Fully explain your answer.