H 3459 Session 110 (1993-1994)
H 3459 General Bill, By J.G. McAbee
A Bill 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.
02/10/93 House Introduced and read first time HJ-11
02/10/93 House Referred to Committee on Labor, Commerce and
Industry HJ-11
A BILL
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.
-----XX----- |