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STATE OF OKLAHOMA
2nd Session of the 58th Legislature (2022)
SENATE BILL 1497 By: Leewright
AS INTRODUCED
An Act relating to motor vehicles; amendin g 47 O.S.
2021, Section 1110, which relat es to perfection of
security interest; providing e xception to prohibition
of certain title transfers; and declaring an
emergency.
BE IT ENACTED BY THE PEOPLE OF THE STATE OF OKLAHOMA:
SECTION 1. AMENDATORY 47 O.S. 202 1, Section 1110, is
amended to read as follows:
Section 1110. A. 1. Except for a security interest in
vehicles held by a dealer for sale or lease, a vehic le registered by
a federally recogniz ed Indian tribe as provid ed in subsection G of
this section, and a vehicle being registered in this state which was
previously registered in another state and which title contains the
name of a secured party on the face of the other state certificate
or title, and except as otherw ise provided in subsection B of
Section 1105 of this title, a security interest in a ve hicle as to
which a certificate of title may be properly issued by the Oklahoma
Tax Commission shall be per fected only when a lien entry form, a nd
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the existing certifica te of title, if any, or application f or a
certificate of title and manufacturer 's certificate of origin
containing the name and address of the secured party and the date of
the security agreemen t and the required fee are delivered to the Tax
Commission or to a motor license agent. As used in this section,
the term "dealer" shall be defined as provided in Section 1 -112 of
this title and the term "security interest" shall be defined as
provided in paragraph (35) of Section 1 -201 of Title 12A of the
Oklahoma Statutes. When a vehicle title is pr esented to a motor
license agent for transferring or registering and the documents
reflect a lienholder, the motor license agent shall perfect the lien
pursuant to subsection G of Section 1105 o f this title. For the
purposes of this section, the term "vehicle" shall not include
special mobilized machiner y, machinery used in highway construction
or road material construction , and rubber-tired road construction
vehicles including rubber -tired cranes. The filing and durat ion of
perfection of a security inter est, pursuant to the provisions of
Title 12A of the Oklahoma Statutes, including, but not limited to,
Section 1-9-311 of Title 12A of the Oklahoma Statutes, s hall not be
applicable to perfection of security interests in vehicles as to
which a certificate o f title may be properly issued by the Tax
Commission, except as to vehicles held by a dealer for sale or lease
and except as provided in subsection D of this section. In all
other respects Title 12A of the Oklahoma Sta tutes shall be
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applicable to such sec urity interests in vehicles as to which a
certificate of title may be properly issued by the Tax Commission.
2. Whenever a person creates a security interest in a vehicle,
the person shall surr ender to the secured part y the certificate of
title or the signed application for a new certificate of title, on
the form prescribed by the Tax Commission, and the manufacturer 's
certificate of origin . The secured party shall deliver the lien
entry form and the required lien fili ng fee within twenty-five (25)
days as provided hereafter with certificate of title or the
application for certificate of title and the manufacturer 's
certificate of origin to the Tax Commission or to a motor license
agent. If the lien entry form, the lie n filing fee and the
certificate of title or application for certificate of title and t he
manufacturer's certificate of origin are delivered to the Tax
Commission or to a motor license agent with in twenty-five (25) days
after the date of the lien entry for m, perfection of the security
interest shall begin from the date of the execution of th e lien
entry form, but otherwise, perfection of the security interest shall
begin from the date of the deliv ery to the Tax Commission or to a
motor license agent.
3. a. For each security interest recorded o n a certificate
of title, or manufacturer 's certificate of origin,
such person shall pay a fee of Ten Dollars ($10.00),
which shall be in addition to other fe es provided for
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in the Oklahoma Vehicle License and Registrat ion Act.
Upon the receipt of the lie n entry form and the
required fees with either the certificate of title or
an application for certificate of title and
manufacturer's certificate of origin, a motor license
agent shall, by plac ement of a clearly disting uishing
mark, record the date and num ber shown in a
conspicuous place, on each of these instruments. Of
the ten-dollar fee, the motor license agent shall
retain Two Dollars ($2.00) for recording the security
interest lien.
b. It shall be unlawful for any person to solicit,
accept, or receive any gratuity or compensation for
acting as a messenger and for acting as the agent or
representative of another person in applying for the
recording of a security interest or for the
registration of a motor vehicle and obtaining the
license plates or for the issuance of a certificate of
title therefor unless the Tax Commission has appointed
and approved the person to perform such acts; and
before acting as a me ssenger, any such person shall
furnish to the Tax Commission a surety bond in such
amount as the Tax Commission shall determine
appropriate.
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4. The certificate of title or the application for certificate
of title and manufacturer 's certificate of origin w ith the record of
the date of receipt clearly marked thereon shall be returned to the
debtor together with a notice that the debtor is required to
register and pay all additional fees and taxes due within thirty
(30) days from the date of purchase of the v ehicle.
5. Any person creating a security interest in a veh icle that
has been previously registe red in the debtor's name and on which all
taxes due the state have been paid shall surrender the certificate
of ownership to the secured party . The secured party shall have the
duty to record the security interest as p rovided in this section and
shall, at the same time, obtain a new certificate of title which
shall show the secured interest on the face of the certificate of
title.
6. The lien entry form with t he date and assigned number
thereof clearly marked thereon s hall be returned to the secured
party. If the lien entry form is received and authenti cated, as
herein provided, by a motor license agent, the agent shall make a
report thereof to the Tax Commiss ion upon the forms and in the
manner as may be prescribed by the Tax Commission.
7. The Tax Commission shall have the duty to record the lien
upon the face of the certificate of title issued at the time of
registering and paying all fees and taxes due on the vehicle.
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8. When there is an active lien from a commerc ial lender in
place on a vehicle, mot or license agents shall be prohibited from
transferring the certificate of title on that vehicle until the lien
is satisfied, except when the title is transferred :
a. to a person whose name is included on the loan for
which the lien is placed,
b. to a trust created by a person whose name is included
on the loan for which the lien is placed , or
c. from a person who has died , upon the submission of a
death certificate.
B. 1. A secured party shall, wi thin seven (7) busine ss days
after the satisfaction of the security interest, furnish directly or
by mail a release of a security interest to the Tax Commission and
mail a copy thereof to the last -known address of the debtor . If the
security interest has been satisfied by pay ment from a licensed used
motor vehicle dealer to whom the motor vehicle has been trans ferred,
the secured party shall also, within seven (7) business days after
such satisfaction, mail an additional copy of the release to the
dealer. If the secured party fails to furnish the release as
required, the secured party shall be liable to the deb tor for a
penalty of One Hundred Dollars ($100.00) . Following the seven (7)
business days after satisfaction of the lien and upon receipt by the
lienholder of written c ommunication demanding the release of the
lien, thereafter the penalty shall increase t o One Hundred Dollars
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($100.00) per day for each additional day beyond seven (7) business
days until accumulating to One Thousand Five Hundred Dolla rs
($1,500.00) or the value of the vehicle, whichever is l ess, and, in
addition, any loss caused to the debt or by such failure.
2. Upon release of a security interest the owner may obtain a
new certificate of title omitting reference to the security
interest, by submitting to the Tax Commission or to a motor lic ense
agent:
a. a release signed by the secured par ty, an application
for new certificate of title and the proper fees, or
b. by submitting to the Tax Commission or the motor
license agent an affidav it, supported by such
documentation as the Tax Commission may require, by
the owner on a form prescribed by the Tax Commission
stating that the security interest has been satisfied
and stating the reasons why a release cannot be
obtained, an application fo r a new certificate o f
title and the proper fees.
Upon receiving such affidavit that the security interest h as been
satisfied, the Tax Commission shall issue a new certificate of title
eliminating the satisfied security interest and the name and address
of the secured parties who have been paid and satisfied . The Tax
Commission shall accept a release of a secur ity interest in any form
that identifies the debtor, the secured party, and the vehicle, and
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contains the signature of the secured party . The Tax Commission
shall not require any particular form for the re lease of a security
interest.
The words "security interest" when used in the Oklahoma Vehicle
License and Registration Act do not include liens dependent upon
possession.
C. The Tax Commission shal l file and index cert ificates of
title so that at all time s it will be possible to trace a
certificate of title to the vehicle designated therein, identify the
lien entry form, and the names and addresses of secured parties, or
their assignees, so that all or any part of such information may be
made readily available to those who make legitimate inquiry of the
Tax Commission as to the existence or nonexistence of security
interest in the vehicle.
D. 1. Any security interest in a vehicle properly perfected
prior to July 1, 197 9, may be continued as to its effecti veness or
duration as provided by Sections 1-9-510 and 1-9-515 of Title 12A of
the Oklahoma Statutes, or may be terminated, assigned or released as
provided by Sections 1 -9-512, 1-9-513 and 1-9-514 of Title 12A of
the Oklahoma Statutes, as fully as if this section had not been
enacted, or, at the option o f the secured party, may also be
perfected under this section, and, if so perfected, the time of
perfection under this section shall be the date the security
interest was originally perfected under the prio r law.
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2. Upon request of the secured party, the debtor, or any other
holder of the certificate of title shall surrender the certificate
of title to the secured party and shall do such other acts as may be
required to perfect the security interest under t his section.
E. If a manufactured home is permane ntly affixed to real
estate, an Oklahoma certificate of title may be surrendered to the
Tax Commission or a motor license agent for cancellation . When the
document of title is surrendered, the owner shall provide the legal
description or the appropriate t ract or parcel number of the real
estate and other information as may be required on a form provided
by the Tax Commission . The Tax Commission may n ot cancel a document
of title if a lien has been register ed or recorded. The Tax
Commission or motor licen se agent shall notify the owner and any
lienholder that the title has been surrendered to the Tax Commission
and that the Tax Commission may not canc el the title until the lien
is released. Such notification shall include a description of the
lien and such notification to the owner shall be accompanied by the
return of title surrendered . Permanent attachment to real estate
does not affect the validit y of a lien recorded or registered with
the Tax Commission before the document of title is canceled pursuant
to this section. The rights of a prior lienholder pursuant to a
security agreement or the provisions of a credit transaction and the
rights of the state pursuant to a tax lien are preserved. The Tax
Commission or motor license agent shall forward the i nformation to
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the county assessor of the county where the real estate is located
and indicate whether the original document of title has been
canceled. A fee of Five Dollars ($5.00) shall accompany the
application for cancellation of title . When the fee is paid by a
person making an application directly with the Tax Commission, the
fee shall be deposited in the Oklahoma Tax Commission Revolving
Fund. A fee paid to a motor license agent shall be retained b y the
agent. The owner of a manufactured home upo n which the document of
title has been properly surrendered, may apply to the Tax Commission
for issuance of a new original certificate of title upon submission
of:
1. An attestation from the homeowner ind icating ownership of
the manufactured home and the nonexistence of any security interest
or lien of record in the manufactured home ; and
2. A title opinion by a licensed attorney, determining that the
owner of the manufactured home has marketable title to the real
property upon which the manufactured hom e is located and that no
documents filed of record in the county clerk 's office concerning
the real property contain a mortgage, recorded financial statement,
judgment, or lien of record. Persons or entities to whom the title
opinion is addressed may rely on the title opinion . A security
interest in a manufactured home perfected pursuant to this section
shall have priority over a conflicting intere st of a mortgagee or
other lien encumbrancer, or the owner of the real property upon
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which the manufactured h ome became affixed or otherwise permanently
attached. The holder of the security interest in the manufactured
home, upon default, may remove the m anufactured home from such real
property. The holder of the security interest in the manufactured
home shall reimburse the owner of the real property who is not the
debtor and who has not otherwise agreed to access the real property
for the cost of repair of any physical injury to the real property,
but shall not be liable for any diminution in value to the real
property caused by the removal of the manufactured home, trespass,
or any other damages caused by the removal . The debtor shall notify
the holder of the security interest in the manufactured home of the
street address, if any, and the legal description o f the real
property upon which the manufactured home is affixed or otherwise
permanently attached and shall sign such other documents, including
any appropriate mortgage, as may reasonably be requested by t he
holder of such security interest.
F. In the case of motor vehicles or trailers, notwithstanding
any other provision of law, a transaction does not create a sale or
security interest merely beca use it provides that the rental price
is permitted or requi red to be adjusted under the agreement either
upward or downward by reference to the amount realized upon sale or
other disposition of the motor vehicle or trailer.
G. A security interest in vehic les registered by a federally
recognized Indian tribe shall be deemed valid under Oklahoma law if
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validly perfected under the applicable tribal law and the lien is
noted on the face of the tribal certificate of title.
SECTION 2. It being immediately necessary for the preservation
of the public peace, health or safety, an emergency is hereby
declared to exist, by reason whereof this act shall take effect and
be in full force from and after its passage an d approval.
58-2-3070 QD 1/20/2022 8:04:08 AM