Current Status Introducing Body:House Bill Number:3459 Primary Sponsor:McAbee Committee Number:26 Type of Legislation:GB Subject:Wholesale motor vehicle auction Residing Body:House Current Committee:Labor, Commerce and Industry Computer Document Number:DKA/4252AL.93 Introduced Date:19930210 Last History Body:House Last History Date:19930210 Last History Type:Introduced, read first time, referred to Committee Scope of Legislation:Statewide All Sponsors:McAbee Type of Legislation:General Bill
Bill Body Date Action Description CMN Leg Involved
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3459 House 19930210 Introduced, read first time, 26
referred to Committee
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TO AMEND SECTIONS 56-15-310, 56-15-320, AND 56-15-340, CODE OF LAWS OF SOUTH CAROLINA, 1976, RELATING TO DEALER OR WHOLESALER LICENSES, SO AS TO ADD WHOLESALE MOTOR VEHICLE AUCTION TO PROVISIONS ON LICENSING AND REPORTING; TO AMEND SECTION 56-15-10, RELATING TO DEFINITIONS FOR THE CHAPTER ON REGULATION OF MANUFACTURERS, SO AS TO DEFINE WHOLESALER MOTOR VEHICLE AUCTION; AND TO AMEND SECTION 56-3-2320, AS AMENDED, RELATING TO DEALER AND WHOLESALER LICENSE PLATES, SO AS TO ADD WHOLESALE MOTOR VEHICLE AUCTION.
Be it enacted by the General Assembly of the State of South Carolina:
SECTION 1. Section 56-15-310(1) of the 1976 Code is amended to read:
"(1) Before engaging in business as a dealer, or wholesaler, or wholesale motor vehicle auction in this State, a person first must make application to the department for a license. Each license issued expires on December thirty-first next following the date of issuance and must be displayed prominently at the established place of business. The fee for the license is fifty dollars. The license applies to only one place of business of the applicant and is not transferable to another person or place of business except that a licensed dealer may exhibit and sell motor homes, as defined by Section 56-15-10, at fairs, recreational or sports shows, vacation shows, and other similar events or shows upon obtaining a temporary dealer's license in the manner required by this section. Before exhibiting and selling motor homes at temporary locations as permitted above, the dealer shall first make application to the department for a license. To be eligible for a temporary license, a dealer shall hold a valid dealer's license issued pursuant to this chapter. Every temporary dealer's license issued is valid for a period not to exceed ten consecutive days and must be prominently displayed at the temporary place of business. No dealer may purchase more than six temporary licenses in any one calendar year. The fee for each temporary license issued is twenty dollars. A temporary license applies to only one dealer operating in a temporary location and is not transferable to any other dealer or location.
Any A person failing to secure a temporary license as required by this section is guilty of a misdemeanor and, upon conviction, must be punished in the same manner as he would be punished for failure to secure his regular dealer's license.
The provisions of this section may not be construed as allowing the sale of any type of motor vehicles other than motor homes at authorized temporary locations. This section does not prohibit the sale or purchase of a motor vehicle at a wholesale motor vehicle auction licensed by this chapter, and no temporary license is required."
SECTION 2. Section 56-15-320 of the 1976 Code is amended to read:
"Section 56-15-320. (1) Before any a license as a `wholesaler', or `dealer', or a `wholesale motor vehicle auction' is issued to an applicant, he must file an application with the department and furnish the information the department may require, including, but not limited to, information adequately identifying by name and address any individual who owns or controls ten percent or more of the interest in the business. The policy of this section is full disclosure.
(2) Each applicant for licensure as a dealer, or wholesaler, or wholesale motor vehicle auction must furnish a surety bond in the penal amount of fifteen thousand dollars on a form to be prescribed by the director of the Motor Vehicle Division of the department. The bond must be given to the department and executed by the applicant, as principal, and by a corporate surety company authorized to do business in this State, as surety. The bond must be conditioned upon the applicant or licensee complying with the provisions of the statutes applicable to the license and as indemnification for any loss or damage suffered by an owner of a motor vehicle, or his legal representative, by reason of any fraud practiced or fraudulent representation made in connection with the sale or transfer of a motor vehicle by a licensed dealer or wholesaler or the dealer's or wholesaler's agent acting for the dealer or wholesaler or within the scope of employment of the agent or any loss or damage suffered by reason of the violation by the dealer or wholesaler or his agent, of any of the provisions of this chapter. An owner or his legal representative, who suffers the loss or damage has a right of action against the dealer or wholesaler and against the dealer's or wholesaler's surety upon the bond and may recover damages as provided in this chapter. A new bond or a proper continuation certificate must be delivered to the department annually before the license is renewed. However, regardless of the number of years a bond remains in effect, the aggregate liability of the surety for any and all claims is limited to fifteen thousand dollars on each bond and to the amount of the actual loss incurred. The surety has the right to terminate its liability under the bond by giving the department thirty days' written notice of its intent to cancel the bond. The cancellation does not affect any liability incurred or accrued prior to before the cancellation.
(3) If, during any license year, there is any a change in the information that a dealer, or wholesaler, or wholesale motor vehicle auction gave the department in obtaining to obtain or retaining retain a license under this section, the licensee shall report the change to the department within thirty days after the change occurs on the form the department requires.
(4) In the event a licensee ceases being a dealer, or wholesaler, or wholesale motor vehicle auction, he shall, within ten days thereafter, he shall notify the department of this fact and return to the department any license issued pursuant to this chapter and all current dealer license plates issued to the dealer, or wholesaler, or wholesale motor vehicle auction."
SECTION 3. Section 56-15-340 of the 1976 Code is amended to read:
"Section 56-15-340. (1)(A) Every A dealer or wholesaler shall keep complete records of each transaction under which a motor vehicle is transferred for a period of not less than four years from the date of the transaction. The records must show the true name and correct address of the person or persons from whom the motor vehicle was acquired and the date of the transaction; a correct description of the vehicle, when transferred; the true name and correct address of the person to whom the motor vehicle was transferred; and the date of the transaction. The description of the motor vehicle must include the vehicle identification number, make, model, type of body, and the odometer readings at the time the motor vehicle was transferred to and from the dealer or wholesaler. These records must be open at all reasonable times for inspection and copying by the department or any of its duly authorized agents.
(B) A wholesale motor vehicle auction shall establish and retain at its primary place of business complete records in an order that is appropriate for business requirements and that permits systematic retrieval for five years following the date of sale of each motor vehicle. The records must show the name of the most recent owner other than the wholesale motor vehicle auction, the name of the buyer, the vehicle identification numbers, and the odometer reading on the date which the wholesale motor vehicle auction took possession of the motor vehicle.
(2)(C) The records kept by the dealer, or wholesaler, or wholesale motor vehicle auction must be maintained in a reasonably organized and orderly fashion with all entries being legible to the ordinary person upon inspection. Any records Records which are illegible or incapable of accurate interpretation by either the record keeper or the department's inspector or agent are not in compliance with this section.
(3)(D) If any a dealer, or wholesaler, or wholesale motor vehicle auction fails to keep the required records or fails to make them available to the department or its duly authorized agents immediately upon a reasonable request, the dealer, or wholesaler, or wholesale motor vehicle auction is guilty of a misdemeanor and, upon conviction, must be fined not less than fifty dollars nor more than two hundred dollars or imprisoned for up to thirty days. The failure to keep or to make available to the department or its duly authorized agents complete records on each separate motor vehicle constitutes a separate offense."
SECTION 4. Section 56-15-10 of the 1976 Code is amended by adding an item to read:
"(r) `Wholesale motor vehicle auction' is an entity in the business of providing auction services solely in wholesale transactions at its established place of business in which the purchasers are motor vehicle dealers licensed by this or any other jurisdiction, and which neither buys, sells, nor owns the motor vehicles it auctions in the ordinary course of its business. A wholesale motor vehicle auction must not provide auction services in a retail transaction.
(1) When a transfer of title is made as a result of a transaction at a wholesale motor vehicle auction, the reassignment of title or bill of sale must note the name and address of the wholesale motor vehicle auction, but the wholesale motor vehicle auction is not considered to be the owner, seller, transferor, or assignor of title of a motor vehicle by reason of its name appearing on a reassignment of title or bill of sale or by reason of its payment of a guarantee of payment to a seller, payment of net proceeds to a purchaser, or the reservation of a lien or security interest for the purpose of securing payment by a purchaser.
(2) A wholesale motor vehicle auction is not prohibited from buying or selling motor vehicles in its own name, however, in those instances, it is required to comply with the provisions of this law pertaining to reassignment and delivery of title documents and disclosures to buyers."
SECTION 5. Section 56-3-2320 of the 1976 Code, as last amended by Act 498 of 1992, is further amended to read:
"Section 56-3-2320. The department may issue to a duly licensed motor vehicle dealer, or wholesaler, or wholesale motor vehicle auction licensed pursuant to Chapter 15 of this title, upon application being made and the required fee being paid to the department, dealer, or wholesaler, or wholesale motor vehicle auction license plates. The license plates, notwithstanding any provision of this chapter to the contrary, may be used exclusively on motor vehicles owned by the dealer or wholesaler, or owned by or delivered to a wholesale motor vehicle auction for sale. Dealer, or wholesaler, or wholesale motor vehicle auction plates may not be used to operate wreckers in use by the dealer or wholesaler, nor to operate vehicles owned by the dealer and wholesaler that are leased or rented by the public. No dealer or wholesaler plates may be issued by the department unless the dealer or wholesaler furnishes proof in a form acceptable to the department that he has a retail business license as required by Chapter 36 of Title 12 or wholesaler's certificate of exemption from the Tax Commission and has made at least ten sales of motor vehicles in the twelve months preceding his application for a dealer or wholesaler plate. Wholesale motor vehicle auction plates may be issued by the department unless the wholesale motor vehicle auction furnishes proof in a form acceptable to the department that he has a wholesale motor vehicle auction license as required by Chapter 15 of this title, and that at least ten sales of motor vehicles have taken place through the wholesale motor vehicle auction in the twelve months preceding his application for a wholesale motor vehicle auction plate. The sales requirement may be waived by the department if the dealer or wholesaler has been licensed for less than one year.
The department shall make a distinction between dealer tags, and wholesaler tags, and wholesale motor vehicle auction tags. No dealer, or wholesaler, and wholesale motor vehicle auction may be issued more than six plates or the number equal to the average number of employees of the dealership or auction during the preceding year, whichever is greater. For good cause shown, the department in its discretion may issue extra plates.
The cost of each dealer or wholesaler plate issued is twenty dollars.
For purposes of this section, the testing or demonstration of a truck as defined in Section 56-3-20(10) includes permitting a prospective buyer to use the truck for carrying merchandise or cargo for a period not to exceed three days upon the dealer providing the buyer with a special demonstration certificate for this purpose. The form and content of the demonstration certificate must be as prescribed by regulation of the department which also shall also provide certificates to dealers upon their request. The original certificate must be kept by the buyer in the cab of the truck during the three-day demonstration period, and the dealer shall retain a copy of the certificate and also shall also mail a copy of the certificate to the department within twenty-four hours after it is issued to the buyer.
Notwithstanding the provisions of this section, a dealer franchised exclusively for the sale of heavy duty trucks is eligible to obtain dealer tags for exclusive use on such heavy duty trucks regardless of the number of trucks sold by him during the preceding required number of months. These dealer tags for trucks must be noted with a distinct and separate identification and used only on heavy duty trucks."
SECTION 6. This act takes effect upon approval by the Governor.