HB-4450, As Passed House, April 27, 2005
SUBSTITUTE FOR
HOUSE BILL NO. 4450
A bill to amend 1949 PA 300, entitled
"Michigan vehicle code,"
by amending section 217 (MCL 257.217), as amended by 2002 PA 652.
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec. 217. (1) An owner of a vehicle that is subject to
registration under this act shall apply to the secretary of state,
upon an appropriate form furnished by the secretary of state, for
the registration of the vehicle and issuance of a certificate of
title for the vehicle. A vehicle brought into this state from
another state or jurisdiction that has a rebuilt, salvage, scrap,
flood, or comparable certificate of title issued by that other
state or jurisdiction shall be issued a rebuilt, salvage, scrap, or
flood certificate of title by the secretary of state. The
application shall be accompanied by the required fee. An
application for a certificate of title shall bear the signature or
verification and certification of the owner. The application shall
contain all of the following:
(a) The owner's name, the owner's bona fide residence, and
either of the following:
(i) If the owner is an individual, the owner's mailing address.
(ii) If the owner is a firm, association, partnership, limited
liability company, or corporation, the owner's business address.
(b) A description of the vehicle including the make or name,
style of body, and model year; the number of miles, not including
the tenths of a mile, registered on the vehicle's odometer at the
time of transfer; whether the vehicle is a flood vehicle or another
state previously issued the vehicle a flood certificate of title;
whether the vehicle is to be or has been used as a taxi or police
vehicle, or by a political subdivision of this state, unless the
vehicle is owned by a dealer and loaned or leased to a political
subdivision of this state for use as a driver education vehicle;
whether the vehicle has previously been issued a salvage or rebuilt
certificate of title from this state or a comparable certificate of
title from any other state or jurisdiction; vehicle identification
number; and the vehicle's weight fully equipped, if a passenger
vehicle registered in accordance with section 801(1)(a), and, if a
trailer coach or pickup camper, in addition to the weight, the
manufacturer's serial number, or in the absence of the serial
number, a number assigned by the secretary of state. A number
assigned by the secretary of state shall be permanently placed on
the trailer coach or pickup camper in the manner and place
designated by the secretary of state.
(c) A statement of the applicant's title and the names and
addresses of the holders of security interests in the vehicle and
in an accessory to the vehicle, in the order of their priority.
(d) Further information that the secretary of state reasonably
requires to enable the secretary of state to determine whether the
vehicle is lawfully entitled to registration and the owner entitled
to a certificate of title. If the secretary of state is not
satisfied as to the ownership of a late model vehicle or other
vehicle having a value over $2,500.00, before registering the
vehicle and issuing a certificate of title, the secretary of state
may require the applicant to file a properly executed surety bond
in a form prescribed by the secretary of state and executed by the
applicant and a company authorized to conduct a surety business in
this state. The bond shall be in an amount equal to twice the value
of the vehicle as determined by the secretary of state and shall be
conditioned to indemnify or reimburse the secretary of state, any
prior owner, and any subsequent purchaser or lessee of the vehicle
and their successors in interest against any expense, loss, or
damage, including reasonable attorney's fees, by reason of the
issuance of a certificate of title for the vehicle or on account of
any defect in the right, title, or interest of the applicant in the
vehicle. An interested person has a right of action to recover on
the bond for a breach of the conditions of the bond, but the
aggregate liability of the surety to all persons shall not exceed
the amount of the bond. The bond shall be returned at the end of 3
years, or before 3 years if the vehicle is no longer registered in
this state and the currently valid certificate of title is
surrendered to the secretary of state, unless the secretary of
state has received notification of the pendency of an action to
recover on the bond. If the secretary of state is not satisfied as
to the ownership of a vehicle that is valued at $2,500.00 or less
and that is not a late model vehicle, the secretary of state shall
require the applicant to certify that the applicant is the owner of
the vehicle and entitled to register and title the vehicle.
(e) Except as provided in subdivision (f), an application for
a commercial vehicle shall also have attached a scale weight
receipt of the motor vehicle fully equipped as of the time the
application is made. A scale weight receipt is not necessary if
there is presented with the application a registration receipt of
the previous year that shows on its face the empty weight of the
motor vehicle as registered with the secretary of state that is
accompanied by a statement of the applicant that there has not been
structural change in the motor vehicle that has increased the empty
weight and that the previous registered weight is the true weight.
(f) An application for registration of a vehicle on the basis
of elected gross weight shall include a declaration by the
applicant specifying the elected gross weight for which application
is being made.
(g) If the application is for a certificate of title of a
motor vehicle registered in accordance with section 801(1)(p), the
application shall include the manufacturer's suggested base list
price for the model year of the vehicle. Annually, the secretary of
state shall publish a list of the manufacturer's suggested base
list price for each vehicle being manufactured. Once a base list
price is published by the secretary of state for a model year for a
vehicle, the base list price shall not be affected by subsequent
increases in the manufacturer's suggested base list price but shall
remain the same throughout the model year unless changed in the
annual list published by the secretary of state. If the secretary
of state's list has not been published for that vehicle by the time
of the application for registration, the base list price shall be
the manufacturer's suggested retail price as shown on the label
required
to be affixed to the vehicle under
section 3 of the
automobile
information disclosure act, Public Law 85-506, 15
U.S.C.
USC 1232. If the manufacturer's suggested retail price
is
unavailable, the application shall list the purchase price of the
vehicle
as defined in section 801(4) 801.
(2) An applicant for registration of a leased pickup truck or
passenger vehicle that is subject to registration under this act,
except
a vehicle that is subject to a registration
tax fee under
section 801g, shall disclose in writing to the secretary of state
the lessee's name, the lessee's bona fide residence, and either of
the following:
(a) If the lessee is an individual, the lessee's Michigan
driver license number or Michigan personal identification number
or, if the lessee does not have a Michigan driver license or
Michigan personal identification number, the lessee's mailing
address.
(b) If the lessee is a firm, association, partnership, limited
liability company, or corporation, the lessee's business address.
(3) The secretary of state shall maintain the information
described in subsection (2) on the secretary of state's computer
records.
(4) Except as provided in subsection (5), a dealer selling,
leasing, or exchanging vehicles required to be titled, within 15
days after delivering a vehicle to the purchaser or lessee, and a
person engaged in the sale of vessels required to be numbered by
part 801 of the natural resources and environmental protection act,
1994 PA 451, MCL 324.80101 to 324.80199, within 15 days after
delivering a boat trailer weighing less than 2,500 pounds to the
purchaser or lessee, shall apply to the secretary of state for a
new title, if required, and transfer or secure registration plates
and secure a certificate of registration for the vehicle or boat
trailer, in the name of the purchaser or lessee. The dealer's
license may be suspended or revoked in accordance with section 249
for failure to apply for a title when required or for failure to
transfer or secure registration plates and certificate of
registration within the 15 days required by this section. If the
dealer or person fails to apply for a title when required, and to
transfer or secure registration plates and secure a certificate of
registration and pay the required fees within 15 days of delivery
of the vehicle or boat trailer, a title and registration for the
vehicle or boat trailer may subsequently be acquired only upon the
payment of a transfer fee of $15.00 in addition to the fees
specified in section 806. The purchaser or lessee of the vehicle or
the purchaser of the boat trailer shall sign the application,
including, when applicable, the declaration specifying the maximum
elected gross weight, as required by subsection (1)(f), and other
necessary papers to enable the dealer or person to secure the
title, registration plates, and transfers from the secretary of
state. If the secretary of state mails or delivers a purchaser's
certificate of title to a dealer, the dealer shall mail or deliver
the certificate of title to the purchaser not more than 5 days
after receiving the certificate of title from the secretary of
state.
(5) A dealer selling or exchanging an off lease or buy back
vehicle shall apply to the secretary of state for a new title for
the vehicle within 15 days after it receives the certificate of
title from the lessor or manufacturer under section 235 and
transfer or secure registration plates and secure a certificate of
registration for the vehicle in the name of the purchaser. The
dealer's license may be suspended or revoked in accordance with
section 249 for failure to apply for a title when required or for
failure to transfer or secure registration plates and certificate
of registration within the 15-day period. If the dealer or person
fails to apply for a title when required, and to transfer or secure
registration plates and secure a certificate of registration and
pay the required fees within the 15-day time period, a title and
registration for the vehicle may subsequently be acquired only upon
the payment of a transfer fee of $15.00 in addition to the fees
specified in section 806. The purchaser of the vehicle shall sign
the application, including, when applicable, the declaration
specifying the maximum elected gross weight, as required by
subsection (1)(f), and other necessary papers to enable the dealer
or person to secure the title, registration plates, and transfers
from the secretary of state. If the secretary of state mails or
delivers a purchaser's certificate of title to a dealer, the dealer
shall mail or deliver the certificate of title to the purchaser not
more than 5 days after receiving the certificate of title from the
secretary of state.
(6) If a vehicle is delivered to a purchaser or lessee who has
valid Michigan registration plates that are to be transferred to
the vehicle, and an application for title, if required, and
registration for the vehicle is not made before delivery of the
vehicle to the purchaser or lessee, the registration plates shall
be affixed to the vehicle immediately, and the dealer shall provide
the purchaser or lessee with an instrument in writing, on a form
prescribed by the secretary of state, which shall serve as a
temporary registration for the vehicle for a period of 15 days from
the date the vehicle is delivered.
(7) An application for a certificate of title that indicates
the existence of a security interest in the vehicle or in an
accessory to the vehicle, if requested by the security interest
holder, shall be accompanied by a copy of the security agreement
which need not be signed. The request may be made of the seller on
an annual basis. The secretary of state shall indicate on the copy
the date and place of filing of the application and return the copy
to the person submitting the application who shall forward it to
the holder of the security interest named in the application.
(8) If the seller does not prepare the credit information,
contract note, and mortgage, and the holder, finance company,
credit union, or banking institution requires the installment
seller to record the lien on the title, the holder, finance
company, credit union, or banking institution shall pay the seller
a service fee of not more than $10.00. The service fee shall be
paid from the finance charges and shall not be charged to the buyer
in addition to the finance charges. The holder, finance company,
credit union, or banking institution shall issue its check or bank
draft for the principal amount financed, payable jointly to the
buyer and seller, and there shall be imprinted on the back side of
the check or bank draft the following:
"Under Michigan law, the seller must record a first lien in
favor of (name of lender) _______________ on the vehicle with
vehicle identification number _______________ and title the vehicle
only in the name(s) shown on the reverse side." On the front of the
sales check or draft, the holder, finance company, credit union, or
banking institution shall note the name(s) of the prospective
owner(s). Failure of the holder, finance company, credit union, or
banking institution to comply with these requirements frees the
seller from any obligation to record the lien or from any liability
that may arise as a result of the failure to record the lien. A
service fee shall not be charged to the buyer.
(9) In the absence of actual malice proved independently and
not inferred from lack of probable cause, a person who in any
manner causes a prosecution for larceny of a motor vehicle; for
embezzlement of a motor vehicle; for any crime an element of which
is the taking of a motor vehicle without authority; or for buying,
receiving, possessing, leasing, or aiding in the concealment of a
stolen, embezzled, or converted motor vehicle knowing that the
motor vehicle has been stolen, embezzled, or converted, is not
liable for damages in a civil action for causing the prosecution.
This subsection does not relieve a person from proving any other
element necessary to sustain his or her cause of action.
(10) Receipt by the secretary of state of a properly tendered
application for a certificate of title on which a security interest
in a vehicle is to be indicated is a perfection of a security
interest in the vehicle and is equivalent to filing a financing
statement under the uniform commercial code, 1962 PA 174, MCL
440.1101 to 440.11102, with respect to the vehicle. When a security
interest in a vehicle is perfected, it has priority over the rights
of a lien creditor.