H 3365 Session 111 (1995-1996)
H 3365 General Bill, By Koon, Boan, Gamble, Harvin, J.G. McAbee, Neilson, Riser,
Spearman, Stuart and Witherspoon
Similar(S 547)
A Bill to amend the Code of Laws of South Carolina, 1976, by adding Article 5
to Chapter 15, Title 56 so as to provide requirements for wholesale motor
vehicle auctions and for wholesale motor vehicle auction license plates.
01/25/95 House Introduced and read first time HJ-14
01/25/95 House Referred to Committee on Education and Public
Works HJ-15
A BILL
TO AMEND THE CODE OF LAWS OF SOUTH CAROLINA,
1976, BY ADDING ARTICLE 5 TO CHAPTER 15, TITLE 56 SO
AS TO PROVIDE REQUIREMENTS FOR WHOLESALE
MOTOR VEHICLE AUCTIONS AND FOR WHOLESALE
MOTOR VEHICLE AUCTION LICENSE PLATES.
Be it enacted by the General Assembly of the State of South
Carolina:
SECTION 1. Chapter 15, Title 56 of the 1976 Code is amended
by adding:
"Article 5
Wholesale Motor Vehicle Auctions
Section 56-15-510. As used in this article:
(1) `Wholesale motor vehicle auction' is an entity in the
business of providing auction services in wholesale transactions at
its established place of business, and which does not buy, sell, or
own the motor vehicles it auctions in the ordinary course of its
business. (2) `Motor vehicles' with regard to transactions
taking place at a wholesale motor vehicle auction include, but are
not limited to, motor homes, manufactured homes, recreational
vehicles, boats, motorcycles, and motor vehicles as provided for in
Section 56-3-20.
Section 56-15-520. 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. However, the wholesale motor
vehicle auction is not deemed 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, receipt of payment from a
purchaser, or the reservation of a lien or security interest for the
purpose of securing payment from a purchaser.
Section 56-15-530. A wholesale motor vehicle auction is not
prohibited from buying or selling motor vehicles in its own name.
However, in that instance, it shall comply with the provisions of
South Carolina law pertaining to reassignment and delivery of title
documents and disclosures to buyers.
Section 56-15-540. A motor vehicle dealer licensed by this or
another jurisdiction may purchase or sell motor vehicles at a
wholesale motor vehicle auction. A person may purchase or sell
motor vehicles at a wholesale motor vehicle auction if required by
an agency of government or by law.
Section 56-15-550. The following may sell motor vehicles
through a wholesale motor vehicle auction if the motor vehicles are
acquired as an incident to regular business:
(1) manufacturers;
(2) marine dealers;
(3) motor vehicle rental businesses;
(4) motor vehicle lease businesses;
(5) recreation vehicle dealers;
(6) sellers of motor vehicle fleets;
(7) manufacturers;
(8) public officers while performing their official duties;
(9) receivers;
(10) trustees;
(11) administrators;
(12) executors;
(13) guardians;
(14) insurance companies;
(15) banks;
(16) finance companies;
(17) other loan agencies or their agents.
Section 56-15-560. Before engaging in business as a wholesale
motor vehicle auction in this State, an application must be filed
with the Department of Public Safety furnishing the information it
requires including, but not limited to, information adequately
identifying by name and address individuals who own or control ten
percent or more of the interest of the applicant. Each license issued
expires twelve months from the month of issuance and must be
displayed prominently at the established place of business. The
license applies to only one place of business of the applicant and is
not transferable to another person or place of business. The fee for
the license is fifty dollars.
Section 56-15-570. (A) Each applicant for licensure as a
wholesale motor vehicle auction shall furnish a surety bond in the
penal amount of fifteen thousand dollars on a form prescribed by
the Deputy Director of the Motor Vehicle Records and Vehicle
Inspection 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 statutes applicable to the license and as
indemnification for loss or damage suffered by an owner of a motor
vehicle, or his legal representative, by reason of fraud practiced or
fraudulent representation made by the licensee in connection with
the sale or transfer of a motor vehicle by the licensee or its agent
acting for it or within the scope of employment of the agent or loss
or damage suffered by reason of a violation by the licensee or its
agent of this chapter.
(B) An owner or his legal representative who suffers loss or
damage has a right of action against the wholesale motor vehicle
auction and against the licensee'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 all claims is limited to fifteen thousand dollars on
each bond and to the amount of the actual loss incurred. The surety
may terminate its liability under the bond by giving the department
thirty days' written notice of its intent to cancel the bond. The
surety shall notify the department if the bond is canceled. The
cancellation does not affect liability incurred or accrued before the
cancellation.
Section 56-15-580. During a license year, if there is a change in
the information that a wholesale motor vehicle auction gave the
department to obtain or 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.
Section 56-15-590. (A) A wholesale motor vehicle auction shall
establish and retain at its primary place of business complete
records in an order 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 number, and the
odometer reading on the date which the wholesale motor vehicle
auction took possession of the motor vehicle.
(B) The records kept by the 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.
Records which are illegible or incapable of accurate interpretation
by the recordkeeper or the department's inspector or agent are not
in compliance with this section.
(C) If a wholesale motor vehicle auction fails to keep the
required records or fails to make them available to the department
or its authorized agents immediately upon a reasonable request, the
wholesale motor vehicle auction is guilty of a misdemeanor and,
upon conviction, is subject to the provisions of Chapter 54 of Title
12.
Section 56-15-600. (A) The department may issue to a licensed
wholesale motor vehicle auction, upon application and payment of
the required fee to the department, wholesale motor vehicle auction
license plates. The license plates are exclusively for the use of
transporting motor vehicles in the course of doing business as a
wholesale motor vehicle auction and expire twelve months from the
month of issuance.
(B) Wholesale motor vehicle auction license plates must not
be issued by the department unless the wholesale motor vehicle
auction furnishes proof in a form acceptable to the department that
it has a wholesale motor vehicle auction license as required by this
article and that at least twenty sales of motor vehicles have taken
place through the wholesale motor vehicle auction in the twelve
months preceding its application for a license. The sales
requirement may be waived by the department if the wholesale
motor vehicle auction has been licensed for less than one year.
(C) A wholesale motor vehicle auction may be issued two
license plates for the first twenty vehicles auctioned during the
preceding year and one additional license plate for each fifty
vehicles auctioned beyond the initial twenty during the preceding
year but not to exceed one hundred license plates. For good cause
shown, the department in its discretion may issue additional license
plates. If the wholesale motor vehicle auction has been licensed
less than one year, the department shall issue a number of license
plates based on an estimated number of sales for the coming year.
The department may increase or decrease the number of license
plates issued based on actual sales made.
(D) The cost of each wholesale motor vehicle auction license
plate issued is twenty dollars annually."
SECTION 2. This act takes effect upon approval by the
Governor.
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