AN ACT TO EXPAND THE REQUIRED USE OF THE ELECTRONIC LIEN SYSTEM IMPLEMENTED BY THE DIVISION OF MOTOR VEHICLES, TO REVISE THE LAW GOVERNING WHEN A MOTOR VEHICLE DEALER THAT DOES NOT HAVE A MOTOR VEHICLE'S STATEMENT OF ORIGIN OR CERTIFICATE OF TITLE MAY TRANSFER TITLE TO THE MOTOR VEHICLE, AND TO MAKE OTHER CHANGES TO LAWS AFFECTING MOTOR VEHICLE DEALERS. Enacted June 22, 2018. Effective June 22, 2018, except as otherwise provided.
Bill Summaries: S411 VARIOUS MOTOR VEHICLE LAW REVISIONS.
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Bill S 411 (2017-2018)Summary date: Jun 25 2018 - View Summary
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Bill S 411 (2017-2018)Summary date: Jun 13 2018 - View Summary
House amendment makes the following changes to 4th edition. Amends GS 20-72(b) to clarify that no person will have a cause of action against the Division or Division contractors. Adds Section 2.(g), amending GS 20-73(a), allowing a person who transfers title to a vehicle pursuant to a sworn certificate pursuant to GS 20-52.1(d)(concerning when a manufacturer's statement of origin or an existing certificate of title on a motor vehicle is unavailable) to be considered to have complied with this section even when the Division issues a certificate of title to the person after the time limit has elapsed.
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Bill S 411 (2017-2018)Summary date: Jun 13 2018 - View Summary
House committee substitute makes the following changes to the 3rd edition.
Amends GS 20-58.4A by deleting the provision that prohibited a lien on a motor vehicle from being noted on the certificate of title or otherwise perfected by the Division of Motor Vehicles unless the electronic lien system is utilized by the lienholder in accordance with the statute.
Amends GS 20-52.1 by providing that no person has a cause of action against the Division or Division contractors arising from the transfer of a vehicle by a sworn certification when the manufacturer's statement of origin or an existing certificate of title on a motor vehicle is unavailable.
Amends GS 20-58 by providing that for a vehicle registered in this state, the application for notation of a security interest must be accompanied by the existing certificate of title unless in the possession of a prior secured party or in the event the manufacturer's statement of origin or existing certificate of title (1) was not delivered to the dealer or (2) was lost or misplaced on the date the dealer sells or transfers the motor vehicle.
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Bill S 411 (2017-2018)Summary date: Jun 5 2018 - View Summary
House committee substitute makes the following changes to 2nd edition. Changes the long title.
Amends GS 20-52.1(d) and GS 20-72(b), providing that when a motor vehicle's statement of origin or existing certificate of title is unavailable, a motor vehicle dealer may transfer the title by submitting to the Division of Motor Vehicles (Division) a sworn statement signed by the dealer principal or manager that to the best of the signatory's knowledge all prior liens on the vehicle that are reasonably ascertainable have been paid. Indemnifies the dealer owner or manager who is not a signatory from a criminal violation if that person did not have actual knowledge of the falsity of the sworn certification. Indemnifies the Division from legal action arising from such a sworn statement.
Amends GS 20-58(b), indemnifying the dealer owner or manager who is not a signatory on a filed instrument creating a security interest in a motor vehicle from a criminal violation if that person did not have actual knowledge of the falsity of the sworn certification. Makes other clarifying changes. Allows filing a notarized copy of an instrument creating and evidencing a security interest when a manufacturer's statement of origin or an existing certificate of title was (1) not delivered to the dealer or (2) was lost or misplaced before the dealer sells or transfers the vehicle (was, only when the statement or title was unavailable).
Replaces proposed new section GS 20-72.1, governing transfer of ownership when a certificate of title is unavailable with the following. Requires the dealer to deliver the manufacturer's statement of origin or certificate of title to the Division within 20 days of receipt of the title, but no later than 60 days following the sale or transfer of the vehicle or the creation of a security interest. Requires dealer to provide notice to purchaser that purchaser may be entitled to liquidated damages if the dealer fails to deliver the manufacturer's statement of origin or certificate of title to the Division in accordance with this subsection. If the vehicle is a used motor vehicle, the dealer must apply to the Division for a duplicate title within five working days of the date of sale or transfer. If the vehicle is new, the dealer must request a new statement of origin from the applicable manufacturer within five working days of the date of sale or transfer. If the dealer fails to deliver the statement of origin or title within 60 days, the purchaser may seek liquidated damages from the dealer, without having to rescind the purchase.
Amends GS 20-79.1(h), defining the circumstances when a vehicle's statement of origin or title is unavailable for the purposes of temporary license plates, being when it was not delivered to the dealer or when they were lost or misplaced.
Directs the Division, in consultation with the North Carolina Automobile Dealers Association, Inc., to study the impact of the above amendments on Division process and procedures, along with recommended statutory changes and methods to ensure consumer protection in the motor vehicle transfer process. Findings are to be reported by December 31, 2020. This section effective when it becomes law. The above sections effective January 1, 2019.
Amends GS 20-79.02(g), extending the amount of time when dealers are required to display LD license plates on service loaner vehicles to January 1, 2021 (was, 2019).
Extends SL 2015-232, Sections 1.4(b) and 1.1(b), concerning franchised motor vehicle dealer vehicles, to December 31, 2020.
Amends GS 20-79.1(d), requiring a dealer to mail the application and fees for temporary license plates to the Division within 20 days of issuance of the temporary plate (was, 10 working days). No longer requires a contract for sale to be rescinded in writing before delivery of the application and fee is no longer necessary.
Amends GS 20-183.4C, requiring a new vehicle to be inspected before it is delivered to a purchaser at retail in the state (currently, requires inspection before it is sold at retail in the state).
Amends GS 105-562 and GS 105-570, limiting the application of any tax or tax increase levied under Article 51 (Regional Transit Authority Registration Tax) or Article 52 (County Vehicle Registration Tax) to motor vehicles sold or leased by a motor vehicle dealer on or after the effective date of the tax or tax increase, regardless of the date of submission of a title or registration application for the vehicle to the Division. Exempts a motor vehicle sale or lease from a tax or tax increase levied under Article 51 or 52 if the sale or lease was made prior to the effective date of the tax or tax increase. Applies to any tax or tax increase with an effective date on or after the date the act becomes law.
Amends GS 20-4.02, which requires the Division to adjust certain fees and rates quadrennially beginning July 1, 2020. Adds a new provision establishing that any adjustment to fees or rates under the statute applicable to a motor vehicle sold or leased by a motor vehicle dealer applies only to a sale or lease made on or after the effective date of the fee or rate adjustment, regardless of the date of submission of a title and registration application for the motor vehicle with the Division. Exempts motor vehicle sales or leases from adjustments to fees or rates under the statute if the sale or lease was made prior to the effective date of the fee or rate adjustment.
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Bill S 411 (2017-2018)Summary date: Apr 24 2017 - View Summary
Senate committee substitute makes the following change to the 1st edition.
Amends GS 20-72 (Transfer by owner). Deletes the proposed amendment authorizing a motor vehicle dealer to transfer title by certifying specified statements regarding liens, to the best of the dealer's knowledge and information. Replaces the provision authorizing a dealer to submit a completed form and certificate of title within a reasonable time of obtaining or receiving the form with a requirement that the form and certificate be submitted no later than 45 days following the sale or transfer of the vehicle. Replaces the provision subjecting a dealer principal, owner, or manager of a dealership to liability for a violation of the statute with one providing that the dealer principal, owner, or manager of a dealership is liable in accordance with new GS 20-72.1. Provides an exemption to the requirement that a person transferring title or interest deliver the certificate of title at the time of delivering the vehicle for when the certificate of title is unavailable as provided in new GS 20-72.1.
Enacts new GS 20-72.1. Directs a motor vehicle dealer, when an existing certificate of title on a motor vehicle is unavailable, to deliver the certificate of title with the transferee's application for new title and necessary taxes and fees to the DMV within 20 days of receipt of the title, but no later than 45 days following the sale or transfer of the vehicle. Authorizes the dealer to offer the vehicle for sale subject to prior written notice that the dealer is not in possession of the certificate of title. Specifies circumstances under which the certificate of title is considered unavailable. Authorizes the purchaser to rescind the purchase transaction and collect the full purchase price of the vehicle and liquidated damages (as specified) when the dealer fails to deliver the certificate of title to the DMV. Does not limit other civil remedies or consumer protections.
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Bill S 411 (2017-2018)Summary date: Mar 28 2017 - View Summary
Amends GS 20-58.4A(i), concerning mandatory participation in the statewide electronic lien system implemented by the Division of Motor Vehicles (DMV) to process the notification, release, and maintenance of security interests and certificate of title data where a lien is noted through electronic means instead of paper documents. Requires all individuals and lienholders (currently, all individuals and lienholders is qualified with those who are normally engaged in the business or practice of financing motor vehicles) who conduct at least five transactions annually to use the electronic lien system to record information concerning the perfection and release of a security interest in a vehicle. Prohibits any lien on a motor vehicle from being noted on a certificate of title or otherwise perfected by the DMV unless the electronic lien system is utilized by the lienholder in accordance with the statute. Makes technical changes. Effective July 1, 2017.
Amends GS 20-72(b), concerning instances when a manufacturer's statement of origin or an existing certificate of title on a motor vehicle is unavailable for transferring title or interest in a motor vehicle. Provides that a licensed motor vehicle dealer can transfer title to another by certifying in writing in a sworn statement to the DMV that to the best of the dealer's knowledge and information all prior perfected liens on the vehicle have been paid, and that the motor vehicle dealer, despite having used reasonable diligence, was unable to obtain the vehicle's statement of origin or certificate of title on or prior to the date the dealer sold or transferred the vehicle because the statement of origin or certificate of title was (1) not delivered to the dealer or (2) lost or misplaced by the dealer. Provides that in the absence of the DMV developing a form for this certification, a dealer can use any form that satisfies the requirements of GS 20-72(b) so long as the dealer submits the completed form and certificate of title to the DMV within a reasonable time of obtaining or receiving the form.
Provides that it is a Class H felony to knowingly and intentionally file a false sworn certification in accordance with GS 20-72(b) (currently, does not include scienter element). Adds that a dealer principal, owner, or manager of a motor vehicle dealership can only be liable for a violation under GS 20-72(b) for the actions or conduct of a dealership employee if the dealer principal, owner, or manager had actual knowledge of the falsity of the application at the time the application was submitted to the DMV.