SENATE BILL NO. 1050
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MOTOR VEHICLES - VESSELS - TITLES - Amends existing law relating to vehicle
and vessel titles to revise the definition of "transitional ownership
document"; to revise the process and timing for perfecting a lien; to
delete provisions for processing incomplete title applications; to remove
exemptions to the notarization requirement; to provide for calculation and
perfection of a security interest; to clarify a transitional ownership
document as evidence of ownership; and to allow thirty days for submission
of the document to the Idaho Transportation Department.
01/26 Senate intro - 1st rdg - to printing
01/29 Rpt prt - to Transp
02/02 Rpt out - rec d/p - to 2nd rdg
02/05 2nd rdg - to 3rd rdg
02/06 3rd rdg - PASSED - 35-0-0
AYES -- Andreason, Bair, Bastian, Bilyeu, Broadsword, Burkett,
Cameron, Coiner, Corder, Darrington, Davis, Fulcher, Gannon, Geddes,
Goedde, Hammond, Heinrich, Hill, Jorgenson, Kelly, Keough, Langhorst,
Little, Lodge, Malepeai, McGee, McKague, McKenzie, Pearce,
Richardson, Schroeder, Siddoway, Stegner, Stennett, Werk
NAYS -- None
Absent and excused -- None
Floor Sponsor - Heinrich
Title apvd - to House
02/07 House intro - 1st rdg - to Transp
02/23 Rpt out - rec d/p - to 2nd rdg
02/26 2nd rdg - to 3rd rdg
03/06 3rd rdg - PASSED - 68-0-2
AYES -- Anderson, Andrus, Barrett, Bayer, Bedke, Bell, Bilbao, Black,
Block, Bock, Boe, Bolz, Brackett, Bradford, Chadderdon, Chavez, Chew,
Clark, Collins, Crane, Durst, Edmunson, Eskridge, Hagedorn, Hart,
Harwood, Henbest, Henderson, Jaquet, Killen, King, Kren, Lake,
LeFavour, Loertscher, Luker, Marriott, Mathews, McGeachin, Mortimer,
Moyle, Nielsen, Nonini, Pasley-Stuart, Patrick, Pence, Raybould,
Ring, Ringo, Roberts, Ruchti, Rusche, Sayler, Schaefer, Shepherd(2),
Shepherd(8), Shirley, Shively, Smith(30), Snodgrass, Stevenson,
Thayn, Trail, Vander Woude, Wills, Wood(27), Wood(35), Mr. Speaker
NAYS -- None
Absent and excused -- Labrador, Smith(24)
Floor Sponsor - Mortimer
Title apvd - to Senate
03/07 To enrol
03/08 Rpt enrol - Pres signed - Sp signed
03/09 To Governor
03/13 Governor signed
Session Law Chapter 66
]]]] LEGISLATURE OF THE STATE OF IDAHO ]]]]
Fifty-ninth Legislature First Regular Session - 2007
IN THE SENATE
SENATE BILL NO. 1050
BY TRANSPORTATION COMMITTEE
1 AN ACT
2 RELATING TO VEHICLE AND VESSEL TITLES AND TRANSITIONAL OWNERSHIP DOCUMENTS;
3 AMENDING SECTION 49-121, IDAHO CODE, TO REVISE THE DEFINITION OF
4 "TRANSITIONAL OWNERSHIP DOCUMENT" AND TO MAKE A TECHNICAL CORRECTION;
5 AMENDING SECTION 49-510, IDAHO CODE, TO REVISE THE PROCESS AND TIMING FOR
6 PERFECTING A LIEN, TO DELETE PROVISIONS FOR PROCESSING INCOMPLETE TITLE
7 APPLICATIONS, TO REMOVE EXEMPTIONS TO THE NOTARIZATION REQUIREMENT AND TO
8 MAKE TECHNICAL CORRECTIONS; AMENDING SECTION 49-527, IDAHO CODE, TO PRO-
9 VIDE FOR CALCULATION AND PERFECTION OF A SECURITY INTEREST AND TO PROVIDE
10 CORRECT TERMINOLOGY; AMENDING SECTION 49-528, IDAHO CODE, TO CLARIFY A
11 TRANSITIONAL OWNERSHIP DOCUMENT AS EVIDENCE OF OWNERSHIP AND TO ALLOW
12 THIRTY DAYS FOR SUBMISSION OF THE DOCUMENT TO THE DEPARTMENT; AND AMENDING
13 SECTION 49-529, IDAHO CODE, TO PROVIDE THIRTY DAYS TO SUBMIT A TRANSI-
14 TIONAL OWNERSHIP DOCUMENT FOR ACCEPTANCE BY THE DEPARTMENT.
15 Be It Enacted by the Legislature of the State of Idaho:
16 SECTION 1. That Section 49-121, Idaho Code, be, and the same is hereby
17 amended to read as follows:
18 49-121. DEFINITIONS -- T.
19 (1) "Temporary supplemental lot" means a location other than the princi-
20 pal place of business, or supplemental lot within the same or adjacent county
21 as the principal place of business, where a licensed dealer may secure a
22 license to conduct the business and is licensed for a period of time not to
23 exceed ten (10) days for a specific purpose such as auto shows, auctions,
24 shopping center promotions, tent sales, etc. Temporary supplemental lots shall
25 meet all local zoning and building codes for the type of business being con-
26 ducted. The requirements for a principal place of business shall not be appli-
27 cable to temporary supplemental lot locations. The adjacent county restriction
28 shall not apply if the dealer holds the franchise for the products to be dis-
29 played or sold and has approval from a manufacturer for the location where the
30 proposed temporary supplemental lot license will be issued by the department.
31 Nonfranchised dealers shall be permitted to temporarily display or sell their
32 products within a one hundred seventy-five (175) mile radius of their princi-
33 pal place of business, upon approval by the department.
34 (2) "Tires" means:
35 (a) Metal. Every tire the surface of which in contact with the highway is
36 wholly or partly of metal or other hard, nonresilient material.
37 (b) Pneumatic. Every tire in which compressed air is designed to support
38 the load.
39 (c) Snow tire. Every rubber tire with tread design or material embedded
40 in the tire to improve winter traction except studded tires.
41 (d) Solid rubber. Every tire of rubber or other resilient material which
42 does not depend upon compressed air for the support of the load.
43 (e) Studded tire. Every tire with built-in lugs of tungsten carbide or
1 other suitable material designed to contact the road surface for improved
2 winter traction.
3 (3) "Traffic" means pedestrians, ridden or herded animals, vehicles,
4 streetcars and other conveyances either singly or together while using any
5 highway for purposes of travel.
6 (4) "Traffic lane" or "lane of travel" means that portion of the roadway
7 for movement of a single line of vehicles.
8 (5) "Traffic-control device" means any device, whether manually, electri-
9 cally or mechanically operated, placed or erected by authority of a public
10 body or official having jurisdiction, for the purpose of regulating, warning
11 or guiding traffic.
12 (6) "Trailer" means:
13 (a) General. Every vehicle without motive power designed for carrying
14 persons or property and for being drawn by a motor vehicle.
15 (b) Fifth-wheel trailer. A vehicular unit equipped in the same manner as
16 a travel trailer but constructed with a raised forward section that allows
17 a bi-level floor plan. This style is designed to be towed by a vehicle
18 equipped with a device known as a fifth-wheel hitch, which is typically
19 installed in the bed of a pickup truck.
20 (c) Fold down camping trailer. A vehicular portable unit mounted on
21 wheels and constructed with collapsible partial side walls, which fold for
22 towing by another vehicle and unfold at the campsite to provide temporary
23 living quarters, for recreational, camping or travel use.
24 (d) Park trailer. A trailer designed to be towed by a motorized vehicle,
25 and of such size and weight as not to require a special highway movement
26 permit. It is designed for seasonal or temporary living quarters and may
27 be connected to utilities necessary for operation of installed fixtures
28 and appliances. It is built on a single permanent chassis and constructed
29 to permit set up by persons without special skills.
30 (e) Pole trailer. Every vehicle without motive power designed to be drawn
31 by another vehicle and attached to the towing vehicle by means of a reach
32 or pole or by being boomed or otherwise secured to the towing vehicle, and
33 ordinarily used for transporting long or irregularly shaped loads such as
34 poles, pipes, or structural members capable, generally, of sustaining
35 themselves as beams between the supporting connections.
36 (f) Semitrailer. Every vehicle without motive power, designed for carry-
37 ing persons or property and for being drawn by a motor vehicle and so con-
38 structed that some part of its weight and that of its load rests upon or
39 is carried by the towing vehicle.
40 (g) Travel trailer. A vehicular unit, mounted on wheels designed to pro-
41 vide temporary living quarters for recreational, camping, travel or emer-
42 gency use and of such size or weight as not to require special highway
43 movement permits when towed by a motorized vehicle.
44 (h) Utility trailer. (See "Utility Ttrailer," section 49-122, Idaho Code)
45 (7) "Transitional ownership document" means a document used to perfect a
46 lien against creditors or subsequent purchasers when the primary ownership
47 document is not available and the selling dealer, new security interest holder
48 or their agent, to the best of their knowledge, will not have possession of
49 the primary ownership document, within twenty thirty ( 230) days, and contains
50 all of the following:
51 (a) The date of sale or if no sale is involved, the date the contract or
52 security agreement being perfected was signed;
53 (b) The name and address of each owner of the vehicle;
54 (c) The name and address of each security interest holder;
55 (d) If there are multiple security interest holders, the priorities of
1 interest if the security interest holders do not jointly hold a single
2 security interest;
3 (e) The vehicle identification number;
4 (f) The name of the security interest holder or person who submits the
5 transitional ownership document for the security interest holder; and
6 (g) Any other information the department may require for its records.
7 (8) "Transportation," for the purposes of chapter 22, title 49, Idaho
8 Code, means the movement of any regulated quantity of hazardous material or
9 hazardous waste within, through, or to any destination in this state upon the
10 highways of this state.
11 (9) "Transporter" means every person engaged in the business of deliver-
12 ing vehicles of a type required to be registered from a manufacturing, assem-
13 bling or distributing plant to dealers or sales agents of a manufacturer,
14 except in chapter 22, title 49, Idaho Code, where it means any person who
15 transports a hazardous material or hazardous waste within, through, or to any
16 destination upon the highways of this state.
17 (10) "Truck" means:
18 (a) Refuse/sanitation. Any vehicle designed and used solely for the pur-
19 pose of transporting refuse.
20 (b) General. Every motor vehicle exceeding eight thousand (8,000) pounds
21 gross weight designed, used or maintained primarily for the transportation
22 of property.
23 (c) Pickup truck. Every motor vehicle eight thousand (8,000) pounds gross
24 weight or less which is designed, used or maintained primarily for the
25 transportation of property.
26 (d) Truck camper. A portable unit constructed to provide temporary living
27 quarters for recreational, travel or camping use, consisting of a roof,
28 floor, and sides, designed to be loaded onto and unloaded from the bed of
29 a pickup truck.
30 (e) Truck tractor. Every motor vehicle designed and used primarily for
31 drawing other vehicles but not so constructed as to carry a load other
32 than a part of the weight of the vehicle and load so drawn.
33 (11) "True mileage driven" means the mileage of the vehicle as registered
34 by the odometer within the manufacturer's designed tolerance.
35 SECTION 2. That Section 49-510, Idaho Code, be, and the same is hereby
36 amended to read as follows:
37 49-510. LIENS AND ENCUMBRANCES -- FILING -- FEE -- NOTATION ON CERTIFI-
38 CATE -- CONSTRUCTIVE NOTICE. (1) No lien or encumbrance on any vehicle regis-
39 tered under the laws of this state created subsequent to December 31, 1986,
40 irrespective of whether such registration was effected prior or subsequent to
41 the creation of the lien or encumbrance, shall be perfected as against credi-
42 tors or subsequent purchasers or encumbrancers without notice until the holder
43 of the lien or encumbrance, or his successor, agent or assignee, has complied
44 with the requirements of section 49-504, Idaho Code, and has filed the prop-
45 erly completed title application and all required supporting documents with
46 the department or an agent of the department.
47 (2) When the holder of a lien or encumbrance, his successor, agent or
48 assignee, has filed with the department or agent of the department a properly
49 completed title application and supporting documents as required by section
50 49-504, Idaho Code, it shall be the duty of the department or agent of the
51 department to file the same, indorsing endorsing on the title application the
52 date of the creation of the lien or encumbrance receipt. A lien is perfected
53 as of the time of its creation if the transaction is notarized and if the fil-
1 ing is completed with the department or an agent of the department within
2 twenty (20) calendar days thereafter; otherwise, as of the date of the filing
3 of a properly completed application with the department or an agent of the
4 department. If the title application is incomplete or if the supporting docu-
5 ments are incomplete or missing, the title application and supporting docu-
6 ments as submitted will be returned to the lienholder or his successor, agent
7 or assignee for correction and, if the application is not resubmitted in a
8 complete form, including completed supporting documents, to the department or
9 to the agent of the department within twenty (20) days of their having been
10 returned to the lienholder or his successor, agent or assignee, the original
11 date of receipt by the department or agent of the department shall be void.
12 (3) When the department is satisfied as to the genuineness and regularity
13 of the documents submitted, it shall issue a new certificate of title or cre-
14 ate a paperless electronic record of the title and lien filing when substanti-
15 ated by a written agreement as provided in section 49-505, Idaho Code. The
16 title shall contain the name of the owner of the vehicle, the name and address
17 of each holder of a lien or encumbrance, and a statement of all liens or
18 encumbrances which have been filed with the department, together with the date
19 of each lien or encumbrance and the date received by the department or agent
20 of the department. The filing of a lien or encumbrance and the notation of it
21 shall be a condition of perfection and shall constitute constructive notice of
22 the lien or encumbrance and its contents to creditors and subsequent pur-
23 chasers and encumbrancers. All liens or encumbrances so filed with the depart-
24 ment shall be perfected and take priority according to the order in which the
25 same are noted upon the certificate of title or entered into the electronic
26 records of the department.
27 (2) The notarization requirement set out in the second paragraph of sub-
28 section (1) of this section shall not apply to transactions involving a lien
29 in favor of a regulated lender, as defined in section 28-41-301(37), Idaho
30 Code, or a motor vehicle dealer licensed by the Idaho transportation depart-
32 SECTION 3. That Section 49-527, Idaho Code, be, and the same is hereby
33 amended to read as follows:
34 49-527. PURPOSE OF TRANSITIONAL OWNERSHIP DOCUMENT. The purpose of a
35 transitional ownership document is to enable security interest to be perfected
36 in a timely manner when the primary ownership document is not available. The
37 transitional ownership document serves to perfect a lien against creditors or
38 subsequent purchasers.
39 (1) To perfect a security interest the transitional ownership document
40 must be received by the department or agent within twenty thirty ( 230) days of
41 the date of sale. To determine the twenty thirty ( 230) days, exclude the first
42 day (i.e., date of sale) and count each calendar day thereafter. If the twen-
43 tieth thirtieth day falls on a weekend or holiday it is not counted ,; the last
44 date the temporary transitional ownership document will be acceptable accepted
45 is bumped to the next the following business day of the department or agent.
46 working day.
47 (2) The lien will be perfected as of the date and time of filing consis-
48 tent with section 49-510, Idaho Code.
49 (3) The transitional ownership document is not intended to supersede the
50 requirements of section 49-504, Idaho Code, but rather to provide an alterna-
51 tive method of lien perfection.
52 (4) Once a temporary transitional ownership document has been filed with
53 the department or agent, the primary ownership document must be received by
1 the department or agent within ninety (90) calendar days from the date of the
2 security agreement or contract. To determine ninety (90) days, exclude the
3 first day (i.e., day of sale) and count each calendar day thereafter. If the
4 ninetieth day falls on a weekend or holiday, the last date the temporary tran-
5 sitional ownership document may be used to determine date of security interest
6 perfection is bumped to the next the following business day of the department
7 or agent. working day.
8 SECTION 4. That Section 49-528, Idaho Code, be, and the same is hereby
9 amended to read as follows:
10 49-528. CIRCUMSTANCES UNDER WHICH TRANSITIONAL OWNERSHIP DOCUMENT ACCEPT-
11 ABLE AS EVIDENCE OF OWNERSHIP. DOCUMENT. A transitional ownership document is
12 acceptable as an evidence of ownership document only if the primary ownership
14 (1) Is not in the possession of the selling dealer, new security interest
15 holder or the agent of either at the time the transitional ownership document
16 is submitted to the department; and
17 (2) To the best of the knowledge of the selling dealer, security interest
18 holder or agent, will not be available for submission to the department within
19 twenty thirty ( 230) days of the date of sale or if no sale is involved,
20 within the date of a security agreement or contract.
21 SECTION 5. That Section 49-529, Idaho Code, be, and the same is hereby
22 amended to read as follows:
23 49-529. MANDATORY REJECTION OR INVALIDATION OF TRANSITIONAL OWNERSHIP
24 DOCUMENT BY DEPARTMENT. The transportation department shall reject, return or
25 subsequently invalidate a transitional ownership document if:
26 (1) More than twenty thirty ( 230) days have elapsed between the date of
27 sale, or if no sale is involved, more than twenty thirty ( 230) days have
28 elapsed between the date the contract or security interest being perfected was
29 signed and the date the transitional ownership document is received by the
31 (2) The transitional ownership document does not contain all of the
32 information contained in section 49-121(7), Idaho Code;
33 (3) It is determined that persons named on the transitional ownership
34 document as having a security interest did not have a security interest on the
35 date the transitional ownership document was received;
36 (4) It is determined the person who submitted the transitional ownership
37 document made false statements in completing the transitional ownership docu-
39 (5) The department does not receive the primary ownership document from
40 the date of sale within ninety (90) days of the date of sale or if no sale is
41 involved, within ninety (90) days from the date the security agreement or con-
42 tract was signed;
43 (6) The security interest holder or person submitting the transitional
44 ownership document elects to retain, requests it be returned or requests that
45 the transitional ownership document be withdrawn; or
46 (7) The information on or in the transitional ownership document has been
47 changed or altered in a manner that is not acceptable to the department.
STATEMENT OF PURPOSE
Federal Bankruptcy Code was amended last year by Congress, and
became effective on October 1, 2005. This legislation will
bring Idaho Code into compliance with the new federal bankruptcy
code for the purpose of perfecting a security interest in a
vehicle. Idaho code needs to mirror federal code which is used
for the purpose of recognition of liens for bankruptcy filings.
Other amendments are also included as clean-up of current codes
to match our current processes.
Currently under Idaho Code, there is a twenty (20) day timeframe
from the date of sale in which a lender can perfect a security
interest. Federal bankruptcy code was amended to allow a thirty
(30) day time frame to perfect a lien. The amendments eliminate
redundant lien creation date language and simplify processes,
thereby clarifying that the filing time frame for perfection of
a lien is the filing date of a properly completed title
application with the department. They further change the
transitional ownership document filing requirement to 30 days.
There will be no fiscal impact to the department.
Name: Amy Smith
Agency: Idaho Transportation Department
STATEMENT OF PURPOSE/FISCAL NOTE S 1050