S2756

An Act concerning the issuance of certain used motor vehicle titles and registrations, amending R.S.39:10-11, and supplementing chapter 10 of Title 39 of the Revised Statutes.

Be It Enacted by the Senate and General Assembly of the State of New Jersey:

1. R.S.39:10-11 is amended to read as follows:

39:10-11. A. The purchaser of a motor vehicle in this State, other than a dealer licensed pursuant to the provisions of R.S.39:10-19, shall, within 10 working days after its purchase, submit to the [director] chief administrator evidence of the purchase. Upon presentation to the [director] chief administrator of the certificate of origin, or certificate of ownership, or bill of sale issued prior to October 1, 1946, with proper assignment and certification of the seller, a record of the transaction shall be made and filed. A certificate of ownership shall be issued by the [director] chief administrator and delivered to the buyer, in case of a sale not subject to a security interest, and the [director] chief administrator shall collect a fee of $20 for the issuance and filing thereof.

If the purchaser of a used motor vehicle purchased by private sale, as that term is defined in section 2 of P.L. , c. (C. ) (pending before the Legislature as this bill), applies to a licensed motor vehicle dealer for a certificate of ownership and certificate of registration and complies with the provisions of section 2 of P.L. , c. (C. ) (pending before the Legislature as this bill) and all rules and regulations promulgated pursuant thereto, the purchaser shall be deemed to be in compliance with the provisions of this subsection.

For purposes of this subsection, “licensed motor vehicle dealer” means a motor vehicle dealer licensed pursuant to R.S.39:10-19 that is authorized to facilitate the issuance of a certificate of ownership and certificate of registration pursuant to section 2 of P.L. , c. (C. ) (pending before the Legislature as this bill).

B. In the case of a sale subject to a security interest, a certificate of ownership, with the name and address of the holder of the encumbrance or secured party or his assignee recorded thereon, shall be delivered to the holder of the encumbrance or secured party or his assignee and a copy thereof shall be delivered to the buyer. The [director] chief administrator shall collect a fee of $30 for his services in issuing a certificate and copy thereof, and for making a record of and filing the record of the transaction, pursuant to this subsection.

C. Except as hereinafter in this section otherwise expressly provided, whenever a security interest is created in a motor vehicle, other than a security interest which is required to be noted on the certificate of origin or the certificate of ownership, as provided in R.S.39:10-8 and R.S.39:10-9, there shall be filed with the [director] chief administrator the certificate of ownership of the motor vehicle, together with a financing statement on a form prescribed by the [director] chief administrator. The [director] chief administrator shall make and file a record of the transaction and shall issue a certificate of ownership, recording the name and address of the secured party or his assignee thereon, and shall deliver it to the secured party or his assignee. A copy of the certificate of ownership so issued shall be delivered to the buyer. The [director] chief administrator shall collect a fee of $20 for his services in issuing a certificate and copy thereof and for making a record of and filing the record of the transaction, pursuant to this subsection.

D. The financing statement required to be filed pursuant to subsection C. hereof shall be signed only by the buyer, shall not be required to be acknowledged or proved, and shall show, in addition to such matters as the [director] chief administrator may require for the proper identification of the motor vehicle affected, the date of the security agreement, and the names and addresses of the parties thereto. Nothing in this section [39:10-11 contained] shall be construed as requiring that the security agreement or a copy thereof, or any proof of execution thereof other than that contained in the financing statement, shall be presented to the [director] chief administrator. When the buyer is a corporation, it shall be sufficient if the financing statement is signed by any officer thereof, or by any agent designated by the corporation for that purpose, and it shall not be necessary that the financing statement recite the authorization of the agent. When there is more than one buyer, it shall be sufficient if the financing statement is signed by any one of them.

E. Nothing in subsections C. and D. of this section shall apply to security interests in motor vehicles which constitute inventory held for sale, but such interests shall be subject to chapter 9 of Title 12A of the New Jersey Statutes, nor shall anything in the said subsections apply to interests in personal property subject to chapter 28 of Title 46 of the Revised Statutes.

F. In addition to the fees elsewhere in this section provided for, there shall be paid to the [director] chief administrator at the time a certificate of ownership is issued a fee of $10 for notice of satisfaction of the lien or encumbrance of the record or abstract, or of the termination of the security interest, where the motor vehicle is subject to a lien or encumbrance or a security interest as provided in R.S.39:10-14.

G. Notwithstanding any other provision of this chapter, when any dealer licensed under the provisions of R.S.39:10-19 is the purchaser of a motor vehicle in this State, he may, within 10 working days after its purchase, submit to the [director] chief administrator the evidence of purchase. Upon presentation of the certificate of ownership with proper assignment and certification of the seller to the [director] chief administrator, a record of the transaction shall be made and filed. A certificate of ownership shall be issued by the [director] chief administrator and delivered to such purchaser, and the [director] chief administrator shall collect a fee of $10 for the issuing and filing thereof.

If a dealer does not submit the evidence of purchase, upon resale of the motor vehicle he shall execute and attach to the certificate of ownership a dealer reassignment certificate. The [director] chief administrator shall issue dealer reassignment certificates in lots upon payment of a fee of $10 for each certificate.

H. Any purchaser of a motor vehicle who fails to comply with the provisions of this section shall pay to the [director] chief administrator a penalty of $25 plus the issuing and filing fee.

I. The failure of any person to comply with the requirements of this section shall not constitute a misdemeanor within the provisions of R.S.39:10-24, nor shall such failure affect the validity of any instrument creating or reserving a security interest in a motor vehicle, as between the parties to such instrument.

J. The notation of the name and business or residence address of a secured party or his assignee, on the certificate of origin or on the certificate of ownership, as provided in R.S.39:10-8 and R.S.39:10-9, and the presentation to the [director] chief administrator, in accordance with R.S.39:10-11, of the certificate of origin or certificate of ownership so noted, and the compliance with the requirements of subsections C. and D. of R.S.39:10-11 shall be in lieu of all filing requirements imposed by chapter 9 of Title 12A of the New Jersey Statutes and shall constitute the perfection of a security interest in the motor vehicle, and the rights and remedies of the debtors and the secured parties in respect to such security interest shall, except as otherwise expressly provided in this chapter, be subject to and governed by chapter 9 of Title 12A of the New Jersey Statutes.

(cf: P.L.1994, c.60, s.26)

2. (New section) a. As used in this section:

“Licensed motor vehicle dealer” means a motor vehicle dealer licensed pursuant to R.S.39:10-19.

“Private sale” means the transfer of a motor vehicle from a person who sells the motor vehicle and is not the manufacturer of the motor vehicle or a licensed motor vehicle dealer to a person who purchases the motor vehicle and is not a licensed motor vehicle dealer.

b. The New Jersey Motor Vehicle Commission shall permit a licensed motor vehicle dealer to, in accordance with rules and regulations promulgated by the commission, facilitate the issuance of a certificate of ownership and certificate of registration for a used motor vehicle purchased by private sale that shall be registered in this State and that complies with all requirements for issuance of a certificate of ownership and certificate of registration in this State.

The Chief Administrator of the New Jersey Motor Vehicle Commission may suspend the authority of a licensed motor vehicle dealer to facilitate the issuance of a certificate of ownership and certificate of registration upon the finding that the licensed motor vehicle dealer has engaged in abusive practices.

c. A person 17 years of age or older who has purchased a used motor vehicle by private sale that shall be registered in this State and complies with all requirements for issuance of a certificate of ownership and certificate of registration in this State may apply to a licensed motor vehicle dealer within 10 working days after its purchase for the issuance of a certificate of ownership and a certificate of registration, instead of applying to the commission pursuant to the provisions of R.S.39:10-11 and R.S.39:3-4. A licensed motor vehicle dealer may charge a purchaser a reasonable fee for this service, as determined by the chief administrator, in addition to the fees otherwise required for the issuance of a certificate of ownership and certificate of registration. A licensed motor vehicle dealer may issue a temporary registration certificate for a used motor vehicle purchased by private sale in accordance with the provisions of P.L.1969, c.301 (C.39:3-4b et seq.). A person shall apply to the commission to renew a certificate of registration.

d. Notwithstanding the provisions of the “Administrative Procedure Act,” P.L.1968, c.410 (52:14B-1 et seq.), within three months of the effective date of P.L. , c. (C. ) (pending before the Legislature as this bill), the chief administrator shall adopt immediately upon filing proper notice with the Office of Administrative Law, such temporary rules and regulations necessary to effectuate the purposes of P.L. , c. (C. ) (pending before the Legislature as this bill). The rules and regulations so adopted shall be effective for a period not to exceed one year from the date of the filing. The rules and regulations shall thereafter be amended, adopted, or readopted by the chief administrator in accordance with the requirements of the “Administrative Procedure Act,” P.L.1968, c.410 (52:14B-1 et seq.).

3. This act shall take effect immediately.

STATEMENT

This bill requires the New Jersey Motor Vehicle Commission (commission) to permit a licensed motor vehicle dealer to facilitate the issuance of a certificate of ownership and certificate of registration for a used motor vehicle that is purchased by private sale if the vehicle is to be registered in New Jersey and complies with all requirements for issuance of a certificate of ownership and certificate of registration.

The bill authorizes a person who is 17 years of age or older and has purchased a used motor vehicle by private sale that is to be registered in New Jersey to apply to a licensed motor vehicle dealer within 10 working days after purchasing the motor vehicle for the issuance of a certificate of ownership and certificate of registration, instead of applying to the commission for those documents. A licensed motor vehicle dealer may charge a reasonable fee, as determined by the commission, for this service and may issue a temporary registration certificate for the used motor vehicle. A person is required to apply to the commission to renew the motor vehicle’s certificate of registration.

The bill requires the Chief Administrator of the commission to adopt temporary rules and regulations within three months of the effective date of the bill. The temporary rules and regulations are to be effective for a period not to exceed one year from the date they are filed with the Office of Administrative Law. The bill provides that the rules and regulations are to be amended, adopted, or readopted in accordance with the “Administrative Procedure Act.”