AB 1859, as amended, Gallagher. Collateral recovery: release of vehicle.
(1) The Collateral Recovery Act provides for the licensure and regulation of repossession agencies by the Bureau of Security and Investigative Services under the supervision and control of the Director of Consumer Affairs. That act defines the term “repossession” as meaning the locating or recovering of collateral by means of an assignment. That act defines the term “assignment” as any written authorization by the legal owner, lienholder, lessor, lessee, registered owner, or the agent of any of them, to repossess any collateral or any written authorization by an employer to recover any collateral entrusted to an employee or former employee in possession of the collateral. That act requires a licensee to remove personal effects from the collateral and requires a licensee to make a complete and accurate inventory of the personal effects. That act provides for the issuance of qualification certificates, required for the management of the places of business of licensed repossession agencies, to applicants who meet certain requirements, including, among others, 2 years of experience in recovering collateral as a registrant pursuant to the act or as a salaried employee of a financial institution or vehicle dealer, as specified. That act makes a violation of any of its provisions a crime.
This bill, among other things, would exclude experience as an employee of a financial institution from experience that may be applied toward that requirement for qualification certification. The bill would define the terms “repossession” or “repossess” to mean the locating or physically recovering of collateral by means of a repossession order. The bill would define the term “repossession order” as having the same meaning as “assignment” and would change references to “assignment” in the act to “repossession order.” The bill would also define
“locate” or “locating” as searching visually, by a licensee, for collateral without the use of an electronic device, including, but not limited to, a camera, scanner, or automated license plate reader. The bill would exempt an employee of a licensee who is operating an electronic device for the purpose of locating collateral or documenting the location of collateral from registration, as specified. The
begin delete bill would instead require a licensee to make a complete and accurate inventory of the personal effects in the collateral and,end delete if the collateral is locked, would require a licensee to inventory the personal effects within 15 days, if possible. The bill would authorize a debtor, with the consent of the licensee, to waive the preparation and presentation of an inventory of the personal effects not covered by a
security interest, within the time period for specified notices or prior to the completion of the inventory, whichever is earlier, if the debtor signs a specified statement. The bill would require a licensee to give the debtor the phone number of the licensed repossession agency if the debtor claims any personal effects or personal property are missing. The bill would authorize a licensee to store personal effects inside the collateral, as specified. The bill would also prohibit a licensee from conspiring or agreeing to release personal effects or other personal property not covered by a security agreement to anyone other than the debtor. By placing new prohibitions on a licensee, this bill would expand an existing crime and would, therefore, impose a state-mandated local program.
Under the Collateral Recovery Act, licensed repossession agencies are not liable for specified acts or omissions of a legal owner, debtor, lienholder, lessor, lessee, registered owner, or agent of any of them, and are entitled to indemnity from the legal owner, debtor, lienholder, lessor, lessee, or registered owner for losses incurred as a result of those acts or omissions. Under the act, those persons or their agents are not liable for acts or omissions by a licensed repossession agency or its agent in carrying out a repossession order and are entitled to indemnity from the licensed repossession agency for losses incurred as a result of those acts or omissions, as specified.
This bill would extend the above-described provisions applicable to a legal owner, debtor, lienholder, lessor, lessee, or registered owner to a debt collector.
(2) Existing law specifies how and to whom a vehicle that has been removed by a peace officer may be released, including to the legal owner of the vehicle and the legal owner’s agent.
This bill would, notwithstanding specified sections of law, instead prescribe specified procedures and requirements for releasing a vehicle to a licensed repossessor, as defined, including that the licensed repossessor present a copy of the assignment and pay all towing and storage fees related to the seizure of the vehicle.
Existing law exempts from registration a vehicle repossessed pursuant to a security agreement solely for the purpose of transporting the vehicle from the point of repossession to the storage facilities of the repossessor or other specified places if the repossessor transports the vehicle with appropriate documents and makes them available to a law enforcement officer upon request. Existing law exempts a legal owner of a vehicle from the payment of administrative costs assessed by a city, county, or city and county for releasing a properly impounded vehicle, unless the legal owner who redeems the vehicle requests a poststorage hearing. Existing law prohibits a city, county, or city and county from requiring the legal owner or the legal owner’s agent to request a poststorage hearing as a requirement for release of the vehicle.
This bill would specify that the above exemptions apply when a vehicle is released to a licensed repossessor.
(3) The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.
This bill would provide that with regard to certain mandates no reimbursement is required by this act for a specified reason.
With regard to any other mandates, this bill would provide that, if the Commission on State Mandates determines that the bill contains costs so mandated by the state, reimbursement for those costs shall be made pursuant to the statutory provisions noted above.
Vote: majority. Appropriation: no. Fiscal committee: yes. State-mandated local program: yes.
The people of the State of California do enact as follows:
Section 7500.1 of the Business and Professions
2Code is amended to read:
The following terms as used in this chapter have the
4meaning expressed in this section:
5(a) “Advertisement” means any written or printed
6communication, including a directory listing, except a free
7telephone directory listing that does not allow space for a license
9(b) “Bureau” means the Bureau of Security and Investigative
11(c) “Chief” means the Chief of the Bureau of Security and
13(d) “Collateral” means any specific vehicle, trailer, boat,
14recreational vehicle, motor home, appliance, or other property that
15is subject to a security agreement.
16(e) “Combustibles” means any substances or articles that are
17capable of undergoing combustion or catching fire, or that are
18flammable, if retained.
19(f) “Dangerous drugs” means any controlled substances as
20defined in Chapter 2 (commencing with Section 11053) of Division
2110 of the Health and Safety Code.
P5 1(g) “Deadly weapon” means and includes any instrument or
2weapon of the kind commonly known as a blackjack, slungshot,
3billy, sandclub, sandbag, metal knuckles, dirk, dagger, pistol, or
4revolver, or any other firearm, any knife having a blade longer
5than five inches, any razor with an unguarded blade, and any metal
6pipe or bar used or intended to be used as a club.
7(h) “Debtor” means any person obligated under a security
9(i) “Department” means the Department of Consumer Affairs.
10(j) “Director” means the Director of Consumer Affairs.
11(k) “Electronic format” includes, but is not limited to, a text
12message, email, or Internet posting.
13(l) “Health hazard” means any personal effects that if retained
14would produce an unsanitary or unhealthful condition, or which
15might damage other personal effects.
16(m) “Legal owner” means a person holding a security interest
17in any collateral that is subject to a security agreement, a lien
18against any collateral, a repossession order, or an interest in any
19collateral that is subject to a lease agreement.
20(n) “Licensee” means an individual, partnership, limited liability
21company, or corporation licensed under this chapter as a
23(o) “Locate” or “locating” means searching visually, by a
24licensee, for collateral without the use of an electronic device,
25including, but not limited to, a camera, scanner, or automated
26license plate reader.
27(p) “Multiple licensee” means a repossession agency holding
28more than one repossession license under this chapter, with one
29fictitious trade style and ownership, conducting repossession
30business from additional licensed locations other than the location
31shown on the original license.
32(q) “Person” includes any individual, partnership, limited
33liability company, or corporation.
34(r) “Personal effects” means any property that is not the property
35of the legal owner.
36(s) “Private building” means and includes any dwelling,
37outbuilding, or other enclosed structure.
38(t) “Qualified certificate holder” or “qualified manager” is a
39person who possesses a valid qualification certificate in accordance
40with the provisions of Article 5 (commencing with Section 7504)
P6 1and is in active control or management of, and who is a director
2of, the licensee’s place of business.
3(u) “Registered owner” means the individual listed in the records
4of the Department of Motor Vehicles, or on a conditional sales
5contract, or on a repossession order, as the registered owner.
6(v) “Registrant” means a person registered under this chapter.
7(w) “Repossession” or “repossess” means the locating or
8physically recovering of collateral by means of a repossession
10(x) “Repossession order” means any written authorization by
11the legal owner, lienholder, lessor, lessee, registered owner, or the
12agent of any of them, to repossess any collateral, including, but
13not limited to, collateral registered under the Vehicle Code that is
14subject to a security agreement that contains a repossession clause.
15“Repossession order” also means any written authorization by an
16employer to recover any collateral entrusted to an employee or
17former employee in possession of the collateral. A photocopy of
18a repossession order, facsimile copy of a repossession order, or
19electronic format of a repossession order shall have the same force
20and effect as an original written repossession order.
21(y) “Secured area” means and includes any fenced and locked
23(z) “Security agreement” means an obligation, pledge, mortgage,
24chattel mortgage, lease agreement, deposit, or lien, given by a
25debtor as security for payment or performance of his or her debt,
26by furnishing the creditor with a recourse to be used in case of
27failure in the principal obligation. “Security agreement” also
28includes a bailment where an employer-employee relationship
29exists or existed between the bailor and the bailee.
30(aa) “Services” means any duty or labor to be rendered by one
31person for another.
32(ab) “Violent act” means any act that results in bodily harm or
33injury to any party involved.
34(ac) The amendments made to this section by Chapter 418 of
35the Statutes of 2006 shall not be deemed to exempt any person
36from the provisions of this chapter.
Section 7504 of the Business and Professions Code is
38amended to read:
(a) Except as otherwise provided in this chapter, an
2applicant for a qualification certificate shall comply with all of the
4(1) Be at least 18 years of age.
5(2) Have been, for at least two years of lawful experience, during
6the five years preceding the date on which his or her application
7is filed, a registrant or have had two years of lawful experience in
8recovering collateral within this state. Lawful experience means
9experience in recovering collateral as a registrant pursuant to this
10chapter or as a salaried employee of a vehicle dealer. Lawful
11experience does not include any employment performing work
12other than actual collateral recovery.
13Two years’ experience shall consist of not less than 4,000 hours
14of actual compensated work performed by the applicant preceding
15the filing of an application.
16An applicant shall certify that he or she has completed the
17claimed hours of qualifying experience and the exact details as to
18the character and nature thereof by written certifications from the
19employer, licensee, or vehicle dealer, subject to independent
20verification by the director as he or she may determine. In the event
21of the inability of an applicant to supply the written certifications
22from the employer, licensee, or vehicle dealer, in whole or in part,
23applicants may offer other written certifications from other persons
24substantiating their experience for consideration by the director.
25All certifications shall include a statement that representations
26made are true, correct, and contain no material omissions of fact
27to the best knowledge and belief of the applicant or the person
28submitting the certification. An applicant or person submitting the
29certification who declares as true any material matter pursuant to
30this paragraph that he or she knows to be false is guilty of a
32(3) Complete and forward to the bureau a qualified certificate
33holder application which shall be on a form prescribed by the
34director and signed by the applicant. An applicant who declares
35as true any material matter pursuant to this paragraph that he or
36she knows to be false is guilty of a misdemeanor. The application
37shall be accompanied by two recent photographs of the applicant,
38of a type prescribed by the director, and two classifiable sets of
39his or her fingerprints. The residence address, residence telephone
40number, and driver’s license number of each qualified certificate
P8 1holder or applicant for a qualification certificate, if requested, shall
2be confidential pursuant to the Information Practices Act of 1977
3(Chapter 1 (commencing with Section 1798) of Title 1.8 of Part
44 of Division 3 of the Civil Code) and shall not be released to the
6(4) Pass the required examination.
7(5) Pay the required application and examination fees to the
9(b) Upon the issuance of the initial qualification certificate or
10renewal qualification certificate, the bureau shall issue to the
11certificate holder a suitable pocket identification card which
12includes a photograph of the certificate holder. The photograph
13shall be of a size prescribed by the bureau. The card shall contain
14the name of the licensee with whom the certificate holder is
16(c) The application form shall contain a statement informing
17the applicant that a false or dishonest answer to a question may be
18grounds for denial or subsequent suspension or revocation of a
Section 7506.7 of the Business and Professions Code
21 is amended to read:
(a) Employees of a licensee who are engaged
23exclusively in stenographic, typing, filing, clerical, or other office
24activities are not required to register under this article.
25(b) Employees of a licensee who are operating electronic
26devices, including, but not limited to, cameras, scanners, and
27automated license plate readers, for the purpose of locating
28collateral or documenting the location of collateral are not required
29to register under this article.
Section 7507.3 of the Business and Professions Code
31 is amended to read:
A repossession agency shall be required to keep and
33maintain adequate records of all transactions, including, but not
34limited to, repossession order forms; vehicle report of repossession
35required by Section 28 of the Vehicle Code; vehicle condition
36reports, including odometer readings, if available; personal effects
37inventory; notice of seizure; and records of all transactions
38pertaining to the sale of collateral that has been repossessed,
39including, but not limited to, bids solicited and received, cash
40received, deposits made to the trust account, remittances to the
P9 1seller, and allocation of any moneys not so remitted to appropriate
2ledger accounts. Records, including bank statements of the trust
3account, shall be retained for a period of not less than four years
4and shall be available for examination by the bureau upon demand.
5In addition, collateral and personal effects storage areas shall be
6made accessible for inspection by the bureau upon demand. A
7repossession order form may be an original, a photocopy, a
8facsimile copy, or a copy stored in an electronic format.
Section 7507.6 of the Business and Professions Code
10 is amended to read:
(a) Within seven days after a violent act has occurred
12involving a licensee, or any officer, partner, qualified certificate
13holder, registrant, or employee of a licensee, while acting within
14the course and scope of his or her employment or contract, that
15results in a police report or bodily harm or bodily injury, the
16licensee or the licensee’s qualified certificate holder or registrant,
17shall mail or deliver to the chief a notice concerning the incident
18upon a form provided by the bureau.
19(b) Within seven days after the occurrence of a violent act or a
20threatened violent act involving a licensee, or any officer, partner,
21qualified certificate holder, registrant, or employee of a licensee,
22while acting within the course and scope of his or her employment
23or contract, that results in a police report or bodily harm or bodily
24injury, the licensee or the licensee’s qualified certificate holder or
25registrant shall send by certified mail, return receipt requested, a
26notice containing information about the incident to the person or
27individual who made the repossession order. If the assignor is not
28the legal owner, the assignor shall notify the legal owner of the
29contents of the notice.
30(c) A licensee, qualified certificate holder, or registrant may
31send the notice set forth in subdivision (b) for a violent act or
32threatened violent act even if a police report is not made or no
33bodily harm or bodily injury occurs. Any notice of a threatened
34violent act provided pursuant to subdivision (b) may only be used
35to notify a subsequent assignee and not for any collateral purpose.
36Nothing in this subdivision or subdivision (b) shall be construed
37to provide immunity against any claim for defamation.
Section 7507.9 of the Business and Professions Code
39 is amended to read:
Except as otherwise provided in this section, personal
2effects shall be removed from the collateral, including any personal
3effect that is mounted but detachable from the collateral by a
4release mechanism. A complete and accurate inventory of the
5personal effects shall be made, and the personal effects shall be
6labeled and stored by the licensee for a minimum of 60 days in a
7secure manner, except those personal effects removed by or in the
8presence of the debtor or the party in possession of the collateral
9at the time of the repossession. If the licensee or the licensee’s
10agent cannot determine whether the property attached to the
11collateral is a personal effect or a part of the collateral, then that
12fact shall be noted on the inventory and the licensee or agent shall
13not be obligated to remove the item from the collateral, unless the
14item can be removed without the use of tools, in which case it shall
15be removed and inventoried. The licensee or the licensee’s agent
16shall notify the debtor that if the debtor takes the position that an
17item is a personal effect, then the debtor shall contact the legal
18owner to resolve the issue. If the collateral is locked, the licensee
19shall inventory the personal effects within 15 days, if possible.
20(a) The date and time the inventory is made shall be indicated.
21The permanent records of the licensee shall indicate the name of
22the employee or registrant who performed the inventory.
23(b) The following items of personal effects are items determined
24to present a danger or health hazard when recovered by the licensee
25and shall be disposed of in the following manner:
26(1) Deadly weapons and dangerous drugs shall be turned over
27to any law enforcement agency for retention. These items shall be
28entered on the inventory and a notation shall be made as to the
29date, time, and place the deadly weapon or dangerous drug was
30turned over to the law enforcement agency, and a receipt from the
31law enforcement agency shall be maintained in the records of the
33(2) Combustibles shall be inventoried and noted as “disposed
34of, dangerous combustible,” and the item shall be disposed of in
35a reasonable and safe manner.
36(3) Food and other health hazard items shall be inventoried and
37noted as “disposed of, health hazard,” and disposed of in a
38reasonable and safe manner.
39(c) Personal effects may be disposed of after being held for at
40least 60 days. The inventory, and adequate information as to how,
P11 1when, and to whom the personal effects were disposed of, shall
2be filed in the permanent records of the licensee and retained for
4(d) The inventory shall include the name, address, business
5hours, and telephone number of the repossession agency to contact
6for recovering the personal effects and an itemization of all
7personal effects removal and storage charges that will be made by
8the repossession agency. The inventory shall also include the
9following statement: “Please be advised that the property listed
10on this inventory will be disposed of by the repossession agency
11after being held for 60 days from the date of this notice IF
13(e) The inventory shall be provided to a debtor not later than
1448 hours after the recovery of the collateral, except that if:
15(1) The 48-hour period encompasses a Saturday, Sunday, or
16postal holiday, the inventory shall be provided no later than 72
17hours after the recovery of the collateral.
18(2) The 48-hour period encompasses a Saturday or Sunday and
19a postal holiday, the inventory shall be provided no later than 96
20hours after the recovery of the collateral.
21(3) Inventory resulting from repossession of a yacht, motor
22home, or travel trailer is such that it shall take at least four hours
23to inventory, then the inventory shall be provided no later than 96
24hours after the recovery of the collateral. When the 96-hour period
25encompasses a Saturday, Sunday, or postal holiday, the inventory
26shall be provided no later than 120 hours after the recovery of the
28(4) The licensee is unable to open a locked compartment that
29is part of the collateral, the available inventory shall be provided
30no later than 96 hours after the recovery of the collateral. When
31the 96-hour period encompasses a Saturday, Sunday, or postal
32holiday, the inventory shall be provided no later than 120 hours
33after the recovery of the collateral.
34(f) Environmental, Olympic, special interest, or other license
35plates issued pursuant to Article 8 (commencing with Section
365000), Article 8.4 (commencing with Section 5060), or Article 8.5
37(commencing with Section 5100) of Chapter 1 of Division 3 of
38the Vehicle Code that remain the personal effects of the debtor
39shall be removed from the collateral and inventoried pursuant to
40this section. If the plates are not claimed by the debtor within 60
P12 1days, they shall either (1) be effectively destroyed and the licensee
2shall, within 30 days thereafter, notify the Department of Motor
3Vehicles of their effective destruction on a form promulgated by
4the chief that has been approved as to form by the Director of the
5Department of Motor Vehicles; or (2) be retained by the licensee
6indefinitely to be returned to the debtor upon request, in which
7case the licensee shall not charge more than 60 days’ storage on
9(g) The notice may be given by regular mail addressed to the
10last known address of the debtor or by personal service at the option
11of the repossession agency.
12(h) (1) With the consent of the licensee, the debtor may waive
13the preparation and presentation of an inventory if the debtor
14redeems the personal effects or other personal property not covered
15by a security interest within the time period for the notices required
16by this section or prior to completion of the inventory, whichever
17is earlier, and signs a statement that reads only as follows:
19“I, [insert debtor’s name here], have received all personal effects
20that were in the vehicle at the time of the repossession.”
22(2) No other signature or document shall be required to
23the preparation and presentation of an inventory. If the debtor
24claims there are personal effects or personal property missing, the
25licensee shall provide the debtor with the phone number of the
26licensed repossession agency. A licensee shall not require the
27person retrieving the personal effects to sign any other documents
28or waivers prior to the return of the personal effects. No other
29documents or signatures shall be required for the person to receive
30the personal effects. Any fees paid for clerical, handling,
31administering, inventorying, or storage of personal effects are
32confidential and shall only be disclosed by the licensed
33 repossession agency as ordered by a court of competent
35(i) (1) If personal effects or other personal property not covered
36by a security agreement are to be released to someone other than
37the debtor, the repossession agency shall receive written
38authorization to do so from the debtor.
39(2) Subject to paragraph (1), a licensee shall not release or
40conspire or agree to release personal effects or other personal
P13 1property not covered by a security agreement to anyone other than
3(j) A licensee shall not sell personal effects or other personal
4property not covered by a security agreement and remit money
5from the sale to a third party, including, but not limited to, any
7(k) The inventory or waiver of inventory, as provided in
8subdivision (h), shall be a confidential document. A licensee shall
9only disclose the contents of the inventory under the following
11(1) In response to the order of a court having jurisdiction to
12issue the order.
13(2) In compliance with a lawful subpoena issued by a court of
15(3) When the debtor has consented in writing to the release and
16the written consent is signed and dated by the debtor subsequent
17to the repossession and states the entity or entities to whom the
18contents of the inventory may be disclosed.
19(4) To the debtor.
20(l) A licensee who has been notified that collateral will be
21retrieved may store personal effects or personal property inside
22the collateral until the collateral is no longer in the possession of
23the licensee. If a licensee stores personal effects pursuant to this
24subdivision, the notice and inventory provisions of this section
25shall apply, the licensee shall be liable for the security of the
26personal effects, and the collateral shall not be released by the
27licensee until all personal effects or personal property have been
Section 7507.13 of the Business and Professions Code
30 is amended to read:
(a) A licensed repossession agency is not liable for
32the act or omission of a legal owner, debt collector, debtor,
33lienholder, lessor, lessee, registered owner, or an agent of any of
34them, in making a repossession order to it or for accepting a
35repossession order from any legal owner, debt collector, debtor,
36lienholder, lessor, lessee, registered owner, or an agent of any of
37them, and is entitled to indemnity from the legal owner, debt
38collector, debtor, lienholder, lessor, lessee, or registered owner for
39any loss, damage, cost, or expense, including court costs and
40attorney’s fees, that it may reasonably incur as a result thereof.
P14 1Nothing in this subdivision limits the liability of any person for
2his or her tortious conduct.
3(b) The legal owner, debt collector, debtor, lienholder, lessor,
4lessee, registered owner, or the agent of any of them, is not liable
5for any act or omission by a licensed repossession agency, or its
6agent, in carrying out a repossession order and is entitled to
7indemnity from the repossession agency for any loss, damage,
8cost, or expense, including court costs and attorney’s fees, that the
9legal owner, debt collector, debtor, lienholder, lessor, lessee,
10registered owner, or the agent of any of them, may reasonably
11incur as a result thereof. Nothing in this subdivision limits the
12liability of any person for his or her tortious conduct.
13(c) The legal owner, debtor, lienholder, lessor, lessee, registered
14owner, or the agent of any of them, is not guilty of a violation of
15Section 7502.1 or 7502.2 if, at the time of the repossession order,
16the party making the repossession order has in its possession a
17copy of the repossessor’s current, unexpired repossession agency
18license, and a copy of the current, unexpired repossession agency’s
19qualified manager’s certificate, and does not have actual knowledge
20of any order of suspension or revocation of the license or
22(d) Neither a licensed repossession agency nor a legal owner,
23debtor, lienholder, lessor, lessee, registered owner, or an agent of
24any of them may, by any means, direct or indirect, express or
25implied, instruct or attempt to coerce the other to violate any law,
26regulation, or rule regarding the recovery of any collateral,
27including, but not limited to, the provisions of this chapter or
28Section 9609 of the Commercial Code.
29(e) A licensed repossession agency, at least annually, on or
30before January 31 of each year, shall provide a legal owner from
31which the agency accepts a repossession order with a copy of this
32section, Sections 7500.2, 7507.4, 7507.115, 7507.12, and 7507.125
33of this code, and Section 28 of the Vehicle Code.
Section 7508.2 of the Business and Professions Code
35 is amended to read:
The director may assess administrative fines for any
37of the following prohibited acts:
38(a) Recovering collateral or making any money demand in lieu
39thereof, including, but not limited to, collateral registered under
40the Vehicle Code, that has been sold under a security agreement
P15 1before a signed or telegraphic authorization has been received from
2the legal owner, debtor, lienholder, lessor, or repossession agency
3acting on behalf of the legal owner, debtor, lienholder, or lessor
4of the collateral. A telephonic repossession order is acceptable if
5the legal owner, debtor, lienholder, lessor, or repossession agency
6acting on behalf of the legal owner, debtor, lienholder, or lessor
7is known to the licensee and a written authorization from the legal
8owner, debtor, lienholder, lessor, or repossession agency acting
9on behalf of the legal owner, debtor, lienholder, or lessor is
10received by the licensee within 10 working days or a request by
11the licensee for a written authorization from the legal owner,
12debtor, lienholder, lessor, or repossession agency acting on behalf
13of the legal owner, debtor, lienholder, or lessor is made in writing
14within 10 working days. Referrals of repossession orders from one
15licensee to another licensee are acceptable. The referral of a
16repossession order shall be made under the same terms and
17conditions as in the original repossession order. The fine shall be
18twenty-five dollars ($25) for each of the first five violations and
19one hundred dollars ($100) for each violation thereafter, per audit.
20(b) Using collateral or
personal effects, which have been
21recovered, for the personal benefit of a licensee, or officer, partner,
22manager, registrant, or employee of a licensee. The fine shall be
23twenty-five dollars ($25) for the first violation and one hundred
24dollars ($100) for each violation thereafter. This subdivision does
25not apply to personal effects disposed of pursuant to subdivision
26(c) of Section 7507.9. Nothing in this subdivision prohibits the
27using or taking of personal property connected, adjoined, or affixed
28to the collateral through an unbroken sequence if that use or taking
29is reasonably necessary to effectuate the recovery in a safe manner
30or to protect the collateral or personal effects.
31(c) Selling collateral recovered under this chapter, or making a
32demand for payment in lieu of repossession. The fine shall be two
33hundred fifty dollars ($250) for the first violation and one thousand
34dollars ($1,000) for each subsequent violation.
35(d) Unlawfully entering any private building or secured area
36without the consent of the owner, or of the person in legal
37possession thereof, at the time of repossession. The fine shall be
38five hundred dollars ($500) for each violation.
39(e) Committing unlawful assault or battery on another person.
40The fine shall be five hundred dollars ($500) for each violation.
P16 1(f) Falsification or alteration of an inventory. The fine shall be
2twenty-five dollars ($25) for each violation.
3(g) Soliciting from the legal owner the recovery of specific
4collateral registered under the Vehicle Code or under the motor
5vehicle licensing laws of other states after the collateral has been
6seen or located on a public street or on public or private property
7without divulging the location of the vehicle. The fine shall be one
8hundred dollars ($100) for the first violation and two hundred fifty
9dollars ($250) for each violation thereafter.
Section 22651.03 is added to the Vehicle Code, 11immediately following Section 22651, to read:
(a) Notwithstanding Sections 14602.6 and 22651,
13this section shall apply when collateral is released to a licensed
14repossessor. For purposes of this section, “licensed repossessor”
15means a licensed repossessor, licensed repossession agency, or its
16officers or employees pursuant to Chapter 11 (commencing with
17Section 7500) of Division 3 of the Business and Professions Code.
18(b) Pursuant to Section 4022, a vehicle obtained by a licensed
19repossessor as a release of collateral is exempt from registration
20for purposes of the repossessor removing the vehicle to his or her
21storage facility or the facility of the legal owner. A law enforcement
22agency, impounding authority, tow yard, storage facility, or any
23other person in possession of the collateral shall release the vehicle
24without requiring current registration and pursuant to this section.
25The law enforcement agency shall be open to issue a release to the
26legal owner or a licensed repossessor whenever the agency is open
27to serve the public for nonemergency business.
28(c) The law enforcement agency and the impounding agency,
29including any storage facility acting on behalf of the law
30enforcement agency or impounding agency, shall comply with this
31section and shall not be liable to the registered owner for the
32improper release of the vehicle to the legal owner or a licensed
33repossessor provided the release complies with this section. A law
34enforcement agency shall not refuse to issue a release to a legal
35owner or a licensed repossessor on the grounds that it previously
36issued a release.
37(d) A vehicle removed and seized for any reason shall be
38released to the legal owner of the vehicle or to a licensed
39repossessor if all of the following conditions are met:
P17 1(1) The legal owner is a motor vehicle dealer, bank, credit union,
2acceptance corporation, or other licensed financial institution
3legally operating in this state or is another person, not the registered
4owner, holding a security interest in the vehicle.
5(2) (A) The legal owner or the licensed repossessor pays all
6towing and storage fees related to the seizure of the vehicle. Any
7person having possession of the vehicle shall not collect from the
8 legal owner of the type specified in paragraph (1) or a licensed
9repossessor any administrative charges imposed pursuant to Section
1022850.5 unless the legal owner voluntarily requested a poststorage
12(B) A person operating or in charge of a storage facility where
13vehicles are stored pursuant to this section shall accept a valid
14bank credit card or cash for payment of towing, storage, and related
15fees by a legal owner or a licensed repossessor claiming the vehicle.
16A credit card shall be in the name of the person presenting the
17card. “Credit card” means “credit card” as defined in subdivision
18(a) of Section 1747.02 of the Civil Code, except, for the purposes
19of this section, credit card does not include a credit card issued by
20a retail seller.
21(C) A person
operating or in charge of a storage facility
22described in subparagraph (B) who violates subparagraph (B) shall
23be civilly liable to the owner of the vehicle or to the person who
24tendered the fees for four times the amount of the towing, storage,
25and related fees, but not to exceed five hundred dollars ($500).
26(D) A person operating or in charge of a storage facility
27described in subparagraph (B) shall have sufficient funds on the
28premises of the primary storage facility during normal business
29hours to accommodate, and make change in, a reasonable monetary
31(E) Credit charges for towing and storage services shall comply
32with Section 1748.1 of the Civil Code. Law enforcement agencies
33may include the costs of providing for payment by credit when
34making agreements with towing companies on rates.
35(3) The legal owner or licensed repossessor presents a copy of
36the repossession order, as defined in Section 7500.1 of the Business
37and Professions Code; a release from the one responsible
38governmental agency to give to the tow yard, only if required by
39the agency; a government-issued photographic identification card;
40and any one of the following, as determined by the legal owner or
P18 1the licensed repossessor: a certificate of repossession for the
2vehicle, a security agreement for the vehicle, or title, whether paper
3or electronic, showing proof of legal ownership for the vehicle.
4Any documents presented may be originals, photocopies, or
5facsimile copies, or may be transmitted electronically. The law
6enforcement agency, impounding agency, or any other
7governmental agency, or any person acting on behalf of those
8agencies, shall not require any documents to be notarized. The law
9enforcement agency, impounding agency, or any person acting on
10behalf of those agencies may require the licensed repossessor to
11produce a photocopy or facsimile copy of its repossession agency
12license or registration issued pursuant to Chapter 11 (commencing
13with Section 7500) of Division 3 of the Business and Professions
15No administrative costs authorized under subdivision (a) of
16Section 22850.5 shall be charged to the legal owner, of the type
17specified in paragraph (1), who redeems the vehicle unless the
18legal owner voluntarily requests a poststorage hearing. No city,
19county, city and county, or state agency shall require a legal owner
20or a licensed repossessor to request a poststorage hearing as a
21requirement for release of the vehicle to the legal owner or the
22licensed repossessor. The law enforcement agency, impounding
23agency, or other governmental agency, or any person acting on
24behalf of those agencies, shall not require any documents other
25than those specified in this paragraph. The law enforcement agency,
26impounding agency, or other governmental agency, or any person
27acting on behalf of those agencies, shall not require any documents
28to be notarized. The legal owner or the licensed repossessor shall
29be given a copy of any documents he or she is required to sign,
30except for a vehicle evidentiary hold logbook. The law enforcement
31agency, impounding agency, or any person acting on behalf of
32those agencies, or any person in possession of the vehicle may
33photocopy and retain the copies of any documents presented by
34the legal owner or licensed repossessor.
35(4) A failure by a storage facility to comply with any applicable
36conditions set forth in this subdivision shall not affect the right of
37the legal owner or a licensed repossessor to retrieve the vehicle,
38provided all conditions required of the legal owner or licensed
39repossessor under this subdivision are satisfied.
P19 1(e) A legal owner or a licensed repossessor that obtains release
2of a vehicle pursuant to subdivision (d) shall not release the vehicle
3to the registered owner of the vehicle, the person who was listed
4as the registered owner when the vehicle was impounded, or any
5 agents of the registered owner, unless the registered owner is a
6rental car agency.
7(f) The legal owner of collateral shall, by operation of law and
8without requiring further action, indemnify and hold harmless a
9law enforcement agency, city, county, city and county, the state,
10a tow yard, storage facility, or an impounding yard from a claim
11arising out of the release of the collateral to a licensed repossessor
12and from any damage to the collateral after its release, including
13reasonable attorney’s fees and costs associated with defending a
14claim, if the collateral was released in compliance with this section.
No reimbursement is required by this act pursuant to
23Section 6 of Article XIII B of the California Constitution for certain
24costs that may be incurred by a local agency or school district
25because, in that regard, this act creates a new crime or infraction,
26eliminates a crime or infraction, or changes the penalty for a crime
27or infraction, within the meaning of Section 17556 of the
28Government Code, or changes the definition of a crime within the
29meaning of Section 6 of Article XIII B of the California
31However, if the Commission on State Mandates determines that
32this act contains other costs mandated by the state, reimbursement
33to local agencies and school districts for those costs shall be made
34pursuant to Part 7 (commencing with Section 17500) of Division
354 of Title 2 of the Government Code.