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AN ACT relating to towed vehicles. 1
Be it enacted by the General Assembly of the Commonwealth of Kentucky: 2
ď˘Section 1. KRS 186A.190 is amended to read as follows: 3
(1) Except as provided in subsection (6) of this section and in KRS 355.9-311(4), the 4
perfection of a security interest in any property for which has been issued a 5
Kentucky certificate of title shall be by notation on the certificate of title which shall 6
be deemed to have occurred when the provisions of subsection (3) of this section 7
have been complied with. Discharge of a security interest shall be by notation on the 8
certificate of title. Notation shall be made by the entry of information required by 9
subsection (9) of this section into the Automated Vehicle Information System. The 10
notation of the security interest on the certificate of title shall be in accordance with 11
this chapter and shall remain effective from the date on which the security interest is 12
noted on the certificate of title for a period of ten (10) years, or, in the case of a 13
manufactured home, for a period of thirty (30) years, or until discharged under this 14
chapter and KRS Chapter 186. The filing of a continuation statement within the six 15
(6) months preceding the expiration of the initial period of a notation's effectiveness 16
extends the expiration date for five (5) additional years, commencing on the day the 17
notation would have expired in the absence of the filing. Succeeding continuation 18
statements may be filed in the same manner to continue the effectiveness of the 19
initial notation. 20
(2) A motor vehicle dealer, a secured party or its representative, an assignee of a retail 21
installment contract lender, or a county clerk shall rely on a county of residence 22
designated by the debtor on any approved, notarized state form utilized in lien 23
titling or the title transfer process signed by the debtor. Reliance on the foregoing by 24
the motor vehicle dealer, secured parties, and county clerk shall relieve those 25
persons from liability to any third party claiming failure to comply with this section. 26
(3) Except as provided in subsection (6) of this section, the notation of security interests 27 UNOFFICIAL COPY 22 RS BR 2253
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relating to property required to be titled under this chapter in Kentucky through the 1
county clerk shall be done in the office of the county clerk of the county in which 2
the debtor resides as determined by subsections (2) and (4) of this section. The 3
security interest shall be deemed to be noted on the certificate of title and perfected, 4
or deemed perfected at the time the security interest attaches as provided in KRS 5
355.9-203, if in compliance with KRS 186A.195(5), when a title lien statement: 6
(a) Is received by the county clerk in the county in which residence of the debtor 7
resides as determined under the provisions of this section together with the 8
required fees, as designated by the debtor in the sworn statement; 9
(b) Describes the titled vehicle, or vehicle to be titled, by year, model, make, and 10
vehicle identification number; 11
(c) Provides the name of the secured party, or a representative of the secured 12
party, together with the additional information about the secured party 13
required by subsection (9) of this section with reasonable particularity; and 14
(d) Includes the date and time-stamped entry of the notation of the security 15
interest by the county clerk of the required information in the Automated 16
Vehicle Information System (AVIS), or its successor title processing system 17
maintained by the Division of Motor Vehicle Licensing of the Transportation 18
Cabinet. 19
(4) Except as provided in subsection (6) of this section, if the debtor is other than a 20
natural person, the following provisions govern the determination of the county of 21
the debtor's residence: 22
(a) A partnership shall be deemed a resident of the county in which its principal 23
place of business in this state is located. If the debtor does not have a place of 24
business in this state, then the debtor shall be deemed a nonresident for 25
purposes of filing in this state; 26
(b) A limited partnership organized under KRS Chapter 362 or as defined in KRS 27 UNOFFICIAL COPY 22 RS BR 2253
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362.2-102(14) shall be deemed a resident of the county in which its principal 1
place of business is located, as set forth in its certificate of limited partnership 2
or most recent amendment thereto filed pursuant to KRS Chapter 362 or 3
362.2-202. If such office is not located in this state, the debtor shall be 4
deemed a nonresident for purposes of filing in this state; 5
(c) A limited partnership not organized under the laws of this state and authorized 6
to do business in this state shall be deemed a resident of the county in which 7
the office of its process agent is located, as set forth in the designation or most 8
recent amendment thereto filed with the Secretary of State of the 9
Commonwealth of Kentucky; 10
(d) A corporation organized under KRS Chapter 271B, 273, or 274 or a limited 11
liability company organized under KRS Chapter 275 shall be deemed a 12
resident of the county in which its registered office is located, as set forth in 13
its most recent corporate filing with the Secretary of State which officially 14
designates its current registered office; 15
(e) A corporation not organized under the laws of this state, but authorized to 16
transact or do business in this state under KRS Chapter 271B, 273, or 274, or 17
a limited liability company not organized under the laws of this state, but 18
authorized to transact business in this state under KRS Chapter 275, shall be 19
deemed a resident of the county in which its registered office is located, as set 20
forth in its most recent filing with the Secretary of State which officially 21
designates its current registered office; 22
(f) A cooperative corporation or association organized under KRS Chapter 272 23
shall be deemed a resident of the county in which its principal business is 24
transacted, as set forth in its articles of incorporation or most recent 25
amendment thereto filed with the Secretary of State of the Commonwealth of 26
Kentucky; 27 UNOFFICIAL COPY 22 RS BR 2253
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(g) A cooperative corporation organized under KRS Chapter 279 shall be deemed 1
a resident of the county in which its principal office is located, as set forth in 2
its articles of incorporation or most recent amendment thereto filed with the 3
Secretary of State of the Commonwealth of Kentucky; 4
(h) A business trust organized under KRS Chapter 386 shall be deemed a resident 5
of the county in which its principal place of business is located, as evidenced 6
by the recordation of its declaration of trust in that county pursuant to KRS 7
Chapter 386; 8
(i) A credit union organized under Subtitle 6 of KRS Chapter 286 shall be 9
deemed a resident of the county in which its principal place of business is 10
located, as set forth in its articles of incorporation or most recent amendment 11
thereto filed with the Secretary of State of the Commonwealth of Kentucky; 12
and 13
(j) Any other organization defined in KRS 355.1-201 shall be deemed a resident 14
of the county in which its principal place of business in this state is located, 15
except that any limited liability company, limited liability partnership, limited 16
partnership, or corporation not organized under the laws of this state and not 17
authorized to transact or do business in this state shall be deemed a 18
nonresident for purposes of filing in this state. If the organization does not 19
have a place of business in this state, then it shall be deemed a nonresident for 20
purposes of filing in this state. 21
If the debtor does not reside in the Commonwealth, the notation of the security 22
interest shall be done in the office of the county clerk in which the property is 23
principally situated or operated. Notwithstanding the existence of any filed 24
financing statement under the provisions of KRS Chapter 355 relating to any 25
property registered or titled in Kentucky, the sole means of perfecting and 26
discharging a security interest in property for which a certificate of title is required 27 UNOFFICIAL COPY 22 RS BR 2253
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by this chapter is by notation on the property's certificate of title under the 1
provisions of this chapter or in accordance with the provisions of KRS 186.045(3). 2
In other respects the security interest is governed by the provisions of KRS Chapter 3
355. 4
(5) Except as provided in subsection (6) of this section, before ownership of property 5
subject to a lien evidenced by notation on the certificate of title may be transferred, 6
the transferor shall obtain the release of the prior liens in his name against the 7
property being transferred. Once a security interest has been noted on the owner's 8
title, a subsequent title shall not be issued by any county clerk free of the notation 9
unless the owner's title is presented to the clerk and it has been noted thereon that 10
the security interest has been discharged. If this requirement is met, information 11
relating to any security interest shown on the title as having been discharged may be 12
omitted from the title to be issued by the clerk. If information relating to the 13
discharge of a security interest is presented to a clerk under the provisions of KRS 14
186.045(3), the clerk shall discharge the security interest and remove the lien 15
information from AVIS. 16
(6) Notwithstanding subsections (1) to (5) of this section, a county clerk shall, 17
following inspection of the vehicle by the sheriff, to determine that the vehicle has 18
not been stolen, issue a new ownership document to a vehicle, clear of all prior 19
liens, to a person after he or she provides to the county clerk an affidavit devised by 20
the Transportation Cabinet and completed by the person. The ownership document 21
presented as a result of this affidavit shall be in accordance with subsection (7) of 22
this section. In the affidavit, the affiant shall attest that: 23
(a) The affiant or the agent of the affiant possesses the vehicle; 24
(b) Before he or she provided the notices required by paragraphs (c) and (d) of 25
this subsection: 26
1. A debt on the vehicle has been owed him or her for more than thirty (30) 27 UNOFFICIAL COPY 22 RS BR 2253
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days; 1
2. Within thirty (30) days of payment of damages by an insurance company 2
and receipt by the current owner of the motor vehicle or lienholder of 3
damages pursuant to a claim settlement which required transfer of the 4
vehicle to the insurance company, the insurance company has been 5
unable to obtain: 6
a. A properly endorsed certificate of title on the vehicle from the 7
current owner; and 8
b. If applicable, any lien satisfactions; or 9
3. a. The vehicle was: 10
i. Voluntarily towed or transported pursuant to a request of the 11
current owner or an insurance company that a motor vehicle 12
dealer, licensed as a used motor vehicle dealer and motor 13
vehicle auction dealer, take possession of and store the motor 14
vehicle in the regular course of business; or 15
ii. Involuntarily towed or transported under the provisions of 16
KRS 376.275; and 17
b. Within forty-five (45) days of taking possession of the motor 18
vehicle, the motor vehicle dealer, or the towing or storage 19
company, has not been paid storage fees by the current owner or 20
lienholder and has not been provided both a properly endorsed 21
certificate of title and if applicable, any lien satisfactions; 22
(c) More than thirty (30) days before presenting the affidavit to the county clerk, 23
the affiant attempted to notify the owner of the vehicle and all known 24
lienholders, including those noted on the title, by certified mail, return receipt 25
requested, or by a nationally recognized courier service, of his or her name, 26
address, and telephone number as well as his or her intention to obtain a new 27 UNOFFICIAL COPY 22 RS BR 2253
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title or salvage title, as applicable, clear of all prior liens, unless the owner or a 1
lienholder objects in writing; 2
(d) More than fourteen (14) days before presenting the affidavit to the county 3
clerk, the affiant had published a legal notice stating his or her intention to 4
obtain title to the vehicle. The legal notice appeared at least twice in a seven 5
(7) day period in a newspaper with circulation in the county. The legal notice 6
stated: 7
1. The affiant's name, address, and telephone number; 8
2. The owner's name; 9
3. The names of all known lienholders, including those noted on the title; 10
4. The vehicle's make, model, and year; and 11
5. The affiant's intention to obtain title to the vehicle unless the owner or a 12
lienholder objects in writing within fourteen (14) days after the last 13
publication of the legal notice; and 14
(e) Neither the owner nor a lienholder has objected in writing to the affiant's right 15
to obtain title to the vehicle. 16
(7) (a) If subsection (6)(b)1. of this section applies, the new ownership document 17
shall be a title. 18
(b) If subsection (6)(b)2. or 3. of this section applies, the new ownership 19
document shall be a salvage title if the vehicle meets the requirements for a 20
salvage title as stated in KRS 186A.520(1)(a). 21
(c) If subsection (6)(b)2. or 3. of this section applies and the vehicle does not 22
meet the requirements for a salvage title as stated in KRS 186A.520(1)(a), the 23
new ownership document shall be a title. 24
(8) No more than two (2) active security interests may be noted upon a certificate of 25
title. 26
(9) In noting a security interest upon a certificate of title, the county clerk shall ensure 27 UNOFFICIAL COPY 22 RS BR 2253
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that the certificate of title bears the lienholder's name, mailing address and zip code, 1
the date the lien was noted, the notation number, and the county in which the 2
security interest was noted. The clerk shall obtain the information required by this 3
subsection for notation upon the certificate of title from the title lien statement 4
described in KRS 186A.195 to be provided to the county clerk by the secured party. 5
(10) For all the costs incurred in the notation and discharge of a security interest on the 6
certificate of title, the county clerk shall receive the fee prescribed by KRS 64.012. 7
The fee prescribed by this subsection shall be paid at the time of submittal of the 8
title lien statement described in KRS 186A.195. 9
(11) A copy of the application, certified by the county clerk, indicating the lien will be 10
noted on the certificate of title shall be forwarded to the lienholder. 11