Untitled Texas Attorney General Opinion

.. . NE NE s A-wevmm 11. TEXAS July 20, 1951 Han. D. C. Greer State Highway Engineer Texas Rlghway Department Austin, Texas Opinion Bo, V-1211 Re: Evidence of ownership required to accompany an Initial applica- tion for a certificate of title for a new motor vehicle on the effective date of House Bill 409, Acts 52nd Leg., which amends Article 1436-1, V.P.C., the Cer- Dear Sir: tlflcate of Title Act. You have requested the opinion of this office with regard to what dvldence of ownership will be re- quired to aoeompany $he initial application for a cer- tiflc8te of title for a motor vehicle In Texaa on and after the effective date of House Bill 409, Acta 52nd. Leg., 1951, which amends certain sections of Article 1436-1, y.a.c., known as the,Certificate of Title Act. You state that in the past Texas citizens and dealers have purchased many new vehicles upon whiahit was not necessary to furnish a manufacturer's certif- icate in connection wfth the Issuance ,ofa certfflcate of tftle. Many of such vehicles are still in the pos- sesrion of dealers and no certificate of title has been isrued thereon. You then ask whether suuh vehicles which are on hand with dealers as of the effective date of House Bill 409 may be regfstered and titled ueder present requirements or ~1x1 they have to be titled un- der the provisions of House Ball 409. House Bill 409 ameads Sections 7, a, and 9 of Article 1436-1, V.P.C., as follows: ,~ "Section 1. The Certificate of Title Aat af the State of Texas, being Acts,:,,S939, Forty-sixth Legislature, Page 602, Is here- by amended by deleting therefrom Sections 7, 8, and 9, and substituting In lieu there- %T the following: Hon. D. C. Greer, page 2 (V-1211) "'Section 7* The term "First Sale" means the bargain, sale, transfer, or delivery with Intent to pass an interest therein, other than a lien, of a motor vehicle which has not been previously registered or licensed In this State or elsewhere; and such a bargain, sale, transfer or delivery, accompanied by registration or ll- censlng of said vehicle In this State or else- where, shall constitute the first sale of said vehicle, Irrespective of where such bargain, sale, transfer> or delivery occurred. "'Section a. The term "Subsequent Sale" means the bargain, sale, transfer, or delivery, with Intent to pass an interest therein, other than a lien, of a motor vehicle which has been registered or licensed within this State or elsewhere, save and except when such vehicle Is not required under law to be registered or licensed In this State; and any such bargain, sale, txansfer, or delivery of a motor vehicle after same has been registered or licensed shall constitute a subsequent sale, Irrespective of where such bargain, sale, transfer, or delivery occurred. "'Section q* The term "Hew Car" means a motor vehicle which has never been the subject of a first sale either within this State or elsewhere.8 "Sec. 2. If any section, subsection, or clause of this Act Fs for any reason held to be unconstitutional, such decision shall not thereby affect the validity of any of the re- maining portions of this Act, and It Is hereby declared that this Act would have been passed notwithstanding the absence of such portion hereof so declared unconstitutional. "Sec. 3. All laws or parts of laws In conflict herewith are hereby repealed to the extent of such conflict. "Sec. 4. The fact that hundreds of new motor vehicles are now being brought Into the State of Texas as used cars, thereby endanger- ing the title of such vehicles under the Cer- tificate of Title Act and thereby rendering . z Hon. D. C. Greer, page 3 (v-1211) uncertain the legal status of such vehicles, creates an emergency and an imperative public necessity that the Constitutional Rule requlr- ing bills to be read on three several days be suspended, and said Rule is hereby suspended, and that this Act shall be effective from and after the date of its passage, and it is so enacted,'! Prior to the passage of House Bill 409, it was held In State Bighway Department v0 Texas Automotive Dealers Esoclation, 239 S*W"2d 662-(TeK, Clv. App. 1951, errer appl,iedfox that as to motor vehicles purchased or or,herwiseacquired outside of the State of Texas, and imported into Texas for the purpose of resale in Texas, the bargain, sale, transfer, or delivery of the motor vehicle outside the State of Texas, prior to im- portation, transposed the legal status of such motor vehicle to that of a "used car," as then defined in / Article 1436-~1,V.P.C. Thereafter, upon resale being accomplished in Texas, since such motor vehicles were "used cars" regardless of the presence or absence of registration of such motor vehicles in Texas or else- where, the appropriate evidence of ownership to accom- p3ny sn initial application for a certificate of title for such motor vehicles was held to be a properly ac- complished Importer's certificate and such additional evidence of title aspthe Righway Department might re- quire to show good title and the mortgage condition pertaining ,tothe motor vehIc?e, That procedure was expressly Iheldas precludl;g the necessity for present- ing a manufacturer's certificate, B;cuseBill 409 was signed by the Governor on May 23, 19% and since it psssed the Texas Senate by a viva vote vote,,it becomes effective ninety days after th??&teij?; adjournment, which will be September 7, 1951" The biil is unquestionably pertinent to the con- strugctionof Article 1436-l sdopted in State Highwa Department-v. Texas Automotive Dealers Association, supra.O Under-e definition of a "first sale," as amended by House Bill 409, for a "first sale" to be consumma,tedIt must be accompanied by the Initial reg- istration or licensing of the motor vehicle, either in Texas or elsewhere, This, of course, was not true prior to the passage of House Bi3.1409, , Hon. D. C. Greer, page 4 (v-1211) Therefore, after the effective date of House Bill 409, an owner, as defined in Article 1436-1, may not buy or otherwise acquire a motor vehicle at a "first sale" as defined in the amended ,definitfonQrO- vided in House Bill 409, without presentation of a manufacturer's certificate as the evidence of owner- Ship required under Section 28 to accompany the in- itial application for a certificate of title. This is true whether +&e motor vehicle was acquired in Texas or elsewhere. Possession of the motor vehicle by the seller prior to the effective date of House Bill 409 will not alter or change the application of House Bill 409, as the requirement of applying for a certificate of title under Article 1436-l is occa- sioned by the sale or disposition of the motor vehl- ), the registration of the motor vehicle p1"z&$ or the operation of the motor vehicle f Your request reveals the particular adminis- trative QrOblem which will.ar:se after House Bill 409 becomes effective. A great number of automobile deal- ers have acquired QbeViOuSly unregistered and unoperated motor vehicles outside the State of Texas, in States under the laws of which manufacturer's certificates are not required to be furnished by manufacturers to their vendees. Those motor vehicles are resting on dealers' lots in Texas where they are exposed for sale or will soon be, and up until this ,timethey were titied by the vendee who purchased the motor vehicle by presentfng an importer's certificate and a bill of sale or an in- voice D As to all of these motor vehicles, which are not previously titled or registered prior to the effec- tive date of House Bill 409, they must be sold or dis- posed of prior to September 7, 1951, or beginning on that date it will be necessary to furnish a manufact- urer's certificate with the initial application for a certificate of title, We point out in this connection that although dealers are not required to secure certificates of title to motor vehicles whirthey have for sale bee Texas -- Automotive Dealers Association v. Harris Count Tax Assessormzor, 229 S.W.2d 787 (Tex, Sup. 53 1 m? there is nothing ,n the law which would prevent the dealers themselves from applying for titles prior to September 7, 1951, on all unregistered or unlicensed motor vehicles acqulsed outside of Texas and which are now on hand and will be affected by the provisions of . - Hon. D. C. oreer, page 5 (V-1211) House Bill 409, Under the decision in State Highway Department,8. Texas Automotive Dealers Association, m, dealers may title such vehicles-n the pre- sentation of an importer's certificate and an invoice or a bill of sale, prior to September 7, 1951. The foregoing observations also apply to mctor vehicles in the hands of individuals, but there should be no substantlal administrative difficulty as to individuals because Individuals normally import registered vehicles, After the effective date of House Bill 409, all motor vehicles which are regis- tered, in Texas or elsewhere, are used motor vehicles within the incidence of Section 29 of Article 1436-1, V,P0C., and a manufacturer's certificate is not re- quired to accompany a title application for a used motor vehicle. SUMMARY House Bill 409, Acts 52nd Leg,, ROS. 1951, amending Sections 7 8, and 9 oftthe Certificate of Title Law (Art. 1436-1, V.P.C,) becomes effective ninety days after adjournment of the Legislature, or September 7( 1951. Its provisions with respect to 'first sale," "subsequent sale'land "new car'Ias those terms are therein defined are applicable to, and must be complied with after its effec- tive date, in the iesusnce of a certif- icate of title on a motor vehicle brought Into Texas prior to the effective date of the Act but upon which no certificate of title had been Issued, APPROVED: Yours very truly, Bed McDaniel PRICE DANIEL State Affairs Dlvisioa Attorney General Everett Hutchinson Executive Assistant BY Charles D. Mathews First Assistant