H 4608 Session 112 (1997-1998)
H 4608 General Bill, By Kirsh, Gamble and Law
Similar(S 997)
A BILL TO AMEND SECTION 40-39-10, AS AMENDED, CODE OF LAWS OF SOUTH CAROLINA,
1976, RELATING TO PAWNBROKERS, SO AS TO INCLUDE WITHIN THE DEFINITION OF
"PLEDGED GOODS," A MOTOR VEHICLE CERTIFICATE OF TITLE, OTHER THAN A
CERTIFICATE OF TITLE TO A MOBILE HOME; TO AMEND SECTION 40-39-110, AS AMENDED,
RELATING TO VESTING OF TITLE TO PLEDGED PROPERTY, SO AS TO PROVIDE THAT IF A
LOAN IN WHICH A MOTOR VEHICLE CERTIFICATE OF TITLE IS THE PLEDGED GOODS
REMAINS UNPAID AFTER A PERIOD OF SIXTY DAYS FROM THE DUE DATE OR ANY RENEWAL
OR EXTENSION OF IT, THE PAWNBROKER AND THE PLEDGOR HAVE THE SAME RIGHTS AS
ACCORDED UNDER PART 5, CHAPTER 9, TITLE 36 OF THE UNIFORM COMMERCIAL CODE; AND
BY ADDING SECTION 40-39-105, SO AS TO SET LIMITS ON THE INTEREST CHARGED ON A
PAWN TRANSACTION WHEN A MOTOR VEHICLE CERTIFICATE OF TITLE IS THE PLEDGED
GOODS.
02/11/98 House Introduced and read first time HJ-7
02/11/98 House Referred to Committee on Labor, Commerce and
Industry HJ-7
A BILL
TO AMEND SECTION 40-39-10, AS AMENDED, CODE OF
LAWS OF SOUTH CAROLINA, 1976, RELATING TO
PAWNBROKERS, SO AS TO INCLUDE WITHIN THE
DEFINITION OF "PLEDGED GOODS," A MOTOR VEHICLE
CERTIFICATE OF TITLE, OTHER THAN A CERTIFICATE OF
TITLE TO A MOBILE HOME; TO AMEND SECTION 40-39-110,
AS AMENDED, RELATING TO VESTING OF TITLE TO
PLEDGED PROPERTY, SO AS TO PROVIDE THAT IF A LOAN
IN WHICH A MOTOR VEHICLE CERTIFICATE OF TITLE IS
THE PLEDGED GOODS REMAINS UNPAID AFTER A PERIOD
OF SIXTY DAYS FROM THE DUE DATE OR ANY RENEWAL
OR EXTENSION OF IT, THE PAWNBROKER AND THE
PLEDGOR HAVE THE SAME RIGHTS AS ACCORDED UNDER
PART 5, CHAPTER 9, TITLE 36 OF THE UNIFORM
COMMERCIAL CODE; AND BY ADDING SECTION 40-39-105,
SO AS TO SET LIMITS ON THE INTEREST CHARGED ON A
PAWN TRANSACTION WHEN A MOTOR VEHICLE
CERTIFICATE OF TITLE IS THE PLEDGED GOODS.
Be it enacted by the General Assembly of the State of South
Carolina:
SECTION 1. Section 40-39-10 of the 1976 Code, as last amended
by Act 491 of 1988, is further amended to read:
"Section 40-39-10. The following definitions apply for purposes
of this chapter:
(1) 'Person' means an individual, partnership, corporation, joint
venture, trust, association, or any other legal entity however
organized.
(2) 'Pawnbroker' means any person engaged in the business of
lending money on the security of pledged goods, or engaged in the
business of purchasing tangible personal property on condition that
it may be redeemed or repurchased by the seller for a fixed price
within a fixed period of time.
(3) 'Pledged goods' means:
(a) tangible personal property other than choses in action,
title, securities, or printed evidences of indebtedness, which property
is deposited with or otherwise actually delivered into the possession
of a pawnbroker in the course of his business in connection with a
pawn transaction; or
(b) a motor vehicle certificate of title that is deposited with or
otherwise delivered into the possession of a pawnbroker in the course
of his business in connection with a pawn transaction. For purposes
of this item, 'motor vehicle certificate of title' does not include a
certificate of title to a mobile home or a certificate of title to any
other item, regardless of whether it is motorized or self-propelled,
which is designed as a dwelling unit.
(4) 'Pawnshop' means the location at which or premises in
which a pawnbroker regularly conducts business.
(5) 'Month' means that period of time from one date in a calendar
month to the corresponding date in the following calendar month, but
if there is no corresponding date, then the last day of the following
month, and when computations are made for a fraction of a month,
a day is one-thirtieth of a month.
(6) 'Administrator' means the administrator of the Department of
Consumer Affairs.
(7) 'Pawn transaction' means the pledging with a pawnbroker
under this chapter of a single item of goods, or
tangible personal property, or a motor vehicle certificate of
title, as security for a loan of money. Items that are usually sold
as a set are considered a single item and must be included in the same
transaction, and a pledged item together with items that are
accessories to the pledged item are considered a single item and must
be included in the same transaction. A separate pawn transaction
retains its separate character when it is renewed, unless the parties
agree otherwise."
SECTION 2. Section 40-39-110 of the 1976 Code, as last amended
by Act 491 of 1988, is further amended to read:
"Section 40-39-110. (A) Except as provided in
subsection (B) of this section, if If any a loan
remains unpaid for a period of sixty days from the due date or
any a renewal or extension thereof of
it, the title of the borrower or pledgor to the property pledged to
secure the loan shall vest in the pawnbroker, without advertising,
sale, or accountability to the pledgor, if:
(1) the pawn ticket or memorandum delivered to the
borrower in accordance with Section 40-39-80, contains on
the back thereof a notice to that effect,; and
(2) if a printed or written notice of the impending
forfeiture is mailed to the pledgor at the address given on the pawn
ticket, at least ten days prior to the forfeiture date. This
notice must contain a description of the article pledged, and
the amount due thereon as of the date of the notice. No notice
is required on loans of fifty dollars or less.
(B) If a loan in which the pledged goods is a motor vehicle
certificate of title remains unpaid after a period of sixty days from the
due date or any renewal or extension of it, the pawnbroker has the
same rights as a secured party as provided in Part 5, Chapter 9, Title
36 when a debtor is in default under a security agreement. All
collections, takings of possession, and dispositions of collateral after
default must be conducted in accordance with Part 5, Chapter 9, Title
36. All rights accorded a debtor as provided in Part 5, Chapter 9,
Title 36 shall apply to a pledgor of a motor vehicle certificate of title.
(C)(1) A pawnbroker may not use any rights or remedies provided
in subsection (B):
(a) unless the loan amount for the initial pawn transaction is
at least fifty-five percent of the fair market value of the motor vehicle
at the time of the pawn transaction; or
(b) if the borrower or pledgor has made payments on the
principal amount of the original pawn transaction equal to at least one
hundred percent of the principal amount of the original pawn
transaction plus thirty percent of the interest accrued from the time of
the original pawn transaction. No pawnbroker shall refuse any partial
payment of principal offered by a borrower or pledgor.
(2) For purposes of item (1) of this subsection, the fair market
value of the motor vehicle must be determined in the same manner as
county auditors determine the assessed value of motor vehicles for
property tax purposes pursuant to Section 12-36-2640."
SECTION 3. The 1976 Code is amended by adding:
"Section 40-39-105. In the case of a pawn transaction in which a
motor vehicle certificate of title is the pledged goods:
(A) a pawnbroker may charge the maximum interest allowed by
Section 40-39-100 on renewals only during the first ninety days of
the pawn transaction; and
(B) after ninety days, a pawnbroker may charge interest on
renewals at the rate of one-half of the amount for each thirty-day
period allowed by Section 40-39-100."
SECTION 4. This act takes effect upon approval by the Governor.
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