April 22, 2010, Introduced by Reps. Knollenberg and Pearce and referred to the Committee on Regulatory Reform.
A bill to amend 1949 PA 300, entitled
"Michigan vehicle code,"
by amending sections 17a, 57d, 217c, 248, 248c, 248f, 249a, 251,
and 807 (MCL 257.17a, 257.57d, 257.217c, 257.248, 257.248c,
257.248f, 257.249a, 257.251, and 257.807), sections 17a, 248c,
and 249a as amended and section 57d as added by 1993 PA 300,
sections 217c and 251 as amended by 2002 PA 642, section 248 as
amended by 2004 PA 495, section 248f as amended by 2006 PA 298,
and section 807 as amended by 2003 PA 152; and to repeal acts and
parts of acts.
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
1 Sec. 17a. "Foreign salvage vehicle dealer buyer"
means a
1 person who is a licensed dealer in another state and
is engaged
2 in this state in the business of purchasing, selling, or
3 otherwise dealing on a wholesale basis in salvageable parts or
4 vehicles of a type required to have a salvage or scrap
5 certificate of title under this act or jurisdiction and acquires
6 salvage or scrap vehicles exclusively for the purpose of taking
7 those salvage or scrap vehicles out of this state.
8 Sec. 57d. "Scrap certificate of title" means a document
9 issued by the secretary of state evidencing ownership of a scrap
10 vehicle, which may be assigned only to a scrap metal
processor,
11 an automotive recycler, used or secondhand vehicle parts dealer,
12 or a foreign salvage vehicle dealer and reassignable only to a
13 vehicle scrap metal processor a person licensed under section 248
14 or a foreign salvage vehicle buyer.
15 Sec. 217c. (1) The secretary of state may conduct periodic
16 reviews of the records of a dealer to determine whether adequate
17 notice is given to a transferee or lessee of a rebuilt salvage
18 vehicle of that vehicle's prior designation as a salvage vehicle.
19 The secretary of state may request an insurance company to
20 provide copies of salvage title documents and claims reports
21 involving major component parts to assist the secretary of state
22 in monitoring compliance with this act.
23 (2) Except for a late model vehicle that has been stolen and
24 recovered and that has no major component part removed, missing,
25 or destroyed, or damaged and not salvageable, an insurance
26 company licensed to conduct business in this state that acquires
27 ownership of a late model vehicle through the payment of a claim
1 shall proceed under either of the following:
2 (a) If the insurance company acquires ownership of the
3 vehicle through payment of a claim, the owner of the vehicle
4 shall assign the certificate of title to the insurance company
5 which shall do all of the following:
6 (i) Surrender a properly assigned certificate of title to the
7 secretary of state.
8 (ii) If the estimated cost of repair, including parts and
9 labor, is equal to or more than 75% but less than 91% of the
10 predamaged actual cash value of the vehicle, apply for a salvage
11 certificate of title, and if the estimated cost of repair,
12 including parts and labor, is equal to or greater than 91% of the
13 predamaged actual cash value of the vehicle, apply for a scrap
14 certificate of title. The insurance company shall not sell the
15 vehicle without first receiving a salvage or scrap certificate of
16 title, which shall be assigned to the buyer. An insurance company
17 may assign a salvage or scrap certificate of the title only to an
18 automotive recycler, used or secondhand vehicle parts dealer,
19 foreign salvage vehicle dealer, or vehicle scrap metal processor
20 a person licensed under section 248 or a foreign salvage vehicle
21 buyer.
22 (b) If after payment of a total loss claim the insurance
23 company permits the owner of the vehicle to retain ownership, the
24 insurance company shall do all of the following:
25 (i) If the estimated cost of repair, including parts and
26 labor, is equal to or greater than 75% but less than 91% of the
27 predamaged actual cash value of the vehicle, require each owner
1 of the vehicle to sign an application for a salvage certificate
2 of title, or if the estimated cost of repair, including parts and
3 labor, is equal to or greater than 91% of the predamaged actual
4 cash value of the vehicle, require each owner of the vehicle to
5 sign an application for a scrap vehicle certificate of title.
6 (ii) Attach the owner's certificate of title to the
7 application for a salvage or scrap certificate of title or have
8 the owner certify that the certificate of title is lost.
9 (iii) On behalf of the owner, apply to the secretary of state
10 for a salvage or scrap certificate of title in the name of the
11 owner. The owner shall not sell or otherwise dispose of the
12 vehicle without first receiving a salvage or scrap certificate of
13 title, which shall be assigned to the buyer. An insurance company
14 may assign a salvage or scrap certificate of title only to an
15 automotive recycler, used or secondhand vehicle parts dealer,
16 foreign salvage vehicle dealer, or vehicle scrap metal processor
17 a person licensed under section 248 or a foreign salvage vehicle
18 buyer.
19 (3) If an insurance company acquires ownership of a vehicle
20 other than a late model vehicle through payment of damages due to
21 an accident, the company shall surrender a properly assigned
22 title to the buyer upon delivery.
23 (4) If a dealer acquires ownership of a late model vehicle
24 that is a distressed vehicle from an owner, the dealer shall
25 receive an assigned certificate of title. If the assigned
26 certificate of title is not a salvage or scrap certificate of
27 title, the dealer, other than a vehicle scrap metal processor,
1 shall surrender the assigned certificate of title to the
2 secretary of state, and if the estimated cost of repair,
3 including parts and labor, is equal to or greater than 75% but
4 less than 91% of the predamaged actual cash value of the vehicle,
5 apply for a salvage certificate of title, or if the estimated
6 cost of repair, including parts and labor, is equal to or greater
7 than 91% of the predamaged actual cash value of the vehicle,
8 apply for a scrap certificate of title within 5 days after the
9 dealer receives the assigned certificate of title. The dealer may
10 sell a salvage vehicle to another automotive recycler, used or
11 secondhand vehicle parts dealer, foreign salvage vehicle dealer,
12 or vehicle scrap metal processor a person licensed under section
13 248 or a foreign salvage vehicle buyer by assigning the salvage
14 certificate of title to the buyer. Unless the vehicle is rebuilt,
15 inspected, and recertified pursuant to this section, if the
16 vehicle is sold to a buyer other than a dealer, application shall
17 be made submitted for a salvage certificate in the name of the
18 buyer in the manner provided in this act. The dealer may sell a
19 scrap vehicle only to a vehicle scrap metal processor a person
20 licensed under section 248 or a foreign salvage vehicle buyer. A
21 vehicle scrap metal processor shall surrender an assigned
22 certificate of title to the secretary of state within 30 days
23 after acquiring a vehicle for which a certificate of title was
24 received. A vehicle scrap metal processor shall surrender an
25 assigned salvage or scrap certificate of title to the secretary
26 of state within 30 days after acquiring a vehicle for which a
27 salvage or scrap certificate of title was received and report
1 that the vehicle was destroyed or scrapped.
2 (5) An application for a scrap certificate of title shall be
3 made submitted on a form prescribed by the secretary of state
4 accompanied by a fee of $15.00. The application shall contain all
5 of the following:
6 (a) The complete name and current address of the owner.
7 (b) A description of the vehicle, including its make, style
8 of body, model year, fee category or weight, color, and vehicle
9 identification number.
10 (c) If the vehicle is a late model vehicle, a listing of
11 each major component part that was not salvageable.
12 (d) Further information as may reasonably be required by the
13 secretary of state.
14 (6) The scrap certificate of title shall authorize the
15 holder of the document to transport but not drive upon a highway
16 the vehicle or parts of a vehicle, and assign ownership to a
17 vehicle scrap metal processor, automotive recycler, used or
18 secondhand vehicle parts dealer, or foreign salvage vehicle
19 dealer a person
licensed under section 248 or a foreign salvage
20 vehicle buyer. A certificate of title shall not again be issued
21 for this vehicle. A person shall not rebuild or repair a scrap
22 vehicle and allow it to retain the original vehicle
23 identification number.
24 (7) If a person, other than a dealer or insurance company
25 that is subject to subsection (2) or (4), acquires ownership of a
26 distressed, late model vehicle, the person shall surrender the
27 title or assigned certificate of title to the secretary of state,
1 and if the estimated cost of repair, including parts and labor,
2 is equal to or greater than 75% but less than 91% of the
3 predamaged actual cash value of the vehicle, apply for a salvage
4 certificate of title, or if the estimated cost of repair,
5 including parts and labor, is equal to or greater than 91% of the
6 predamaged actual cash value of the vehicle, apply for a scrap
7 certificate of title before the vehicle may be transported.
8 (8) An owner of a vehicle may determine that a vehicle is a
9 scrap vehicle or a salvage vehicle without making any
10 determination as to the actual cash value of the vehicle.
11 (9) If a leasing company, vehicle manufacturer, insurance
12 company not licensed to do business in this state, association,
13 repossession company, self-insured owner, financial institution,
14 governmental entity, or other company, institution, or entity,
15 owns a distressed, late model vehicle, the titleholder shall
16 surrender the title or assigned certificate of title to the
17 secretary of state and apply for a salvage certificate of title
18 if the retail cost of repair, including parts and labor, is equal
19 to or greater than 75% but less than 91% of the predamaged actual
20 cash value of the vehicle, or if the retail cost of repair,
21 including parts and labor, is equal to or greater than 91% of the
22 predamaged actual cash value of the vehicle, apply for a scrap
23 certificate of title, before the vehicle may be transported or
24 sold. If ownership is transferred, the owner shall sell the
25 vehicle only to a dealer who is eligible to buy a salvage or
26 scrap vehicle in this state unless the owner complies with
27 subsection (12) a
person licensed under section 248 or a foreign
1 salvage vehicle buyer. When a leasing company, vehicle
2 manufacturer, insurance company not licensed to do business in
3 this state, association, repossession company, self-insured
4 owner, financial institution, governmental entity, or other
5 company, institution, or entity, estimates the repair of a
6 distressed, late model vehicle for the purpose of determining
7 whether to apply for a salvage or scrap certificate of title, a
8 complete record of the estimate and, if the vehicle is repaired
9 before a transfer of ownership, a complete record of the actual
10 cost of the repairs performed and by whom shall be maintained for
11 a minimum of 5 years by the leasing company, vehicle
12 manufacturer, insurance company not licensed to do business in
13 this state, association, repossession company, self-insured
14 owner, financial institution, governmental entity, or other
15 company, institution, or entity. The estimates and repair records
16 required by this subsection shall be available for unannounced
17 inspections by a law enforcement agency or a representative of
18 the secretary of state. The secretary of state may request a
19 leasing company, vehicle manufacturer, insurance company not
20 licensed to do business in this state, association, repossession
21 company, self-insured owner, financial institution, governmental
22 entity, or other company, institution, or entity to provide
23 copies of title documents, repair estimates, claims reports
24 involving major component parts, and actual cash value
25 determination documents to assist the secretary of state in
26 monitoring compliance with this act.
27 (10) An application for a salvage certificate of title shall
1 be made submitted on a form prescribed by the secretary of state
2 accompanied by a fee of $10.00. The application shall contain all
3 of the following:
4 (a) The complete name and current address of the owner.
5 (b) A description of the vehicle, including its make, style
6 of body, model year, fee category or weight, color, and vehicle
7 identification number.
8 (c) An estimate of the cost repair, including parts and
9 labor, and an estimate of the predamaged actual cash value of the
10 vehicle.
11 (d) If the vehicle is a late model vehicle, a listing of
12 each major component part that was not salvageable.
13 (e) Further information as may reasonably be required by the
14 secretary of state.
15 (11) The secretary of state shall issue and mail the salvage
16 certificate within 5 business days after the time the application
17 is received at the secretary of state's office in Lansing. Each
18 salvage certificate of title shall include a listing of each
19 major component part that was not salvageable.
20 (12) A salvage certificate of title authorizes the holder of
21 the title to possess, transport, but not drive upon a highway,
22 and transfer ownership in, a vehicle. The secretary of state
23 shall not issue a certificate of title or registration plates for
24 a vehicle for which a salvage certificate of title was issued
25 unless a specially trained officer described in subsection (14)
26 certifies all of the following:
27 (a) That the vehicle identification numbers and parts
1 identification numbers are correct.
2 (b) That the applicant has proof of ownership of repair
3 parts used.
4 (c) That the vehicle complies with the equipment standards
5 of this act.
6 (13) The certification required by subsection (12) shall be
7 made submitted on a form prescribed and furnished by the
8 secretary of state in conjunction with the department of state
9 police and shall accompany the application that is submitted to
10 the secretary of state for a certificate of title. An application
11 for a certificate of title shall contain a description of each
12 salvageable part used to repair the vehicle and any
13 identification number affixed to or inscribed upon the part as
14 required by state or federal law. Upon satisfactory completion of
15 the inspection as required by the secretary of state and other
16 requirements for application, the secretary of state shall issue
17 a certificate of title for the vehicle bearing the legend
18 "rebuilt salvage".
19 (14) An officer specially trained as provided by the
20 secretary of state and authorized by the secretary of state to
21 conduct a salvage vehicle inspection is either of the following:
22 (a) An on-duty or off-duty police officer.
23 (b) A previously certified police officer who is appointed
24 by the local police agency as a limited enforcement officer to
25 conduct salvage vehicle inspections. The local police agency
26 shall give this officer access to the agency's law enforcement
27 information network system and the authority to confiscate any
1 stolen vehicle or vehicle parts discovered during an inspection.
2 The local police agency may give the officer the authority to
3 arrest a person suspected of having unlawful possession of a
4 stolen vehicle or vehicle parts.
5 (15) The secretary of state shall issue a certificate to an
6 officer who is specially trained as provided by the secretary of
7 state to conduct salvage vehicle inspections. Only a person who
8 has a valid certification from the secretary of state may perform
9 salvage inspections. The secretary of state, on his or her own
10 initiative or in response to complaints, shall make reasonable
11 and necessary public or private investigations within or outside
12 of this state and gather evidence against an officer who was
13 issued a certificate and who violated or is about to violate this
14 act or a rule promulgated under this act. The secretary of state
15 may suspend, revoke, or deny a certificate after an investigation
16 if the secretary of state determines that the officer committed 1
17 or more of the following:
18 (a) Violated this act or a rule promulgated under this act.
19 (b) Was found guilty of a fraudulent act in connection with
20 the inspection, purchase, sale, lease, or transfer of a salvage
21 vehicle.
22 (c) Was found guilty of the theft, embezzlement, or
23 misappropriation of salvage vehicle inspection fees.
24 (d) Performed improper, careless, or negligent salvage
25 vehicle inspections.
26 (e) Ceased to function as a police officer because of
27 suspension, retirement, dismissal, disability, or termination of
1 employment.
2 (f) Was convicted of a violation or attempted violation of
3 1986 PA 119, MCL 257.1351 to 257.1355.
4 (g) Made a false statement of a material fact in his or her
5 certification of a salvage vehicle inspection or any record
6 concerning a salvage vehicle inspection.
7 (16) Upon receipt of the appropriate abstract of conviction
8 from a court and without any investigation, the secretary of
9 state shall immediately revoke the certificate of an officer who
10 has been convicted of a violation or attempted violation of
11 section 413, 414, 415, 535, 535a, or 536a of the Michigan penal
12 code, 1931 PA 328, MCL 750.413, 750.414, 750.415, 750.535,
13 750.535a, and 750.536a, or has been convicted in federal court or
14 in another state of a violation or attempted violation of a law
15 substantially corresponding to 1 of those sections.
16 (17) If a dealer acquires ownership of an older model
17 vehicle from an owner, the dealer shall receive an assigned
18 certificate of title and shall retain it as long as he or she
19 retains the vehicle. A vehicle scrap metal processor shall
20 surrender an assigned certificate of title to the secretary of
21 state within 30 days after the vehicle is destroyed or scrapped.
22 (18) A dealer selling or assigning a vehicle to a vehicle
23 scrap metal processor shall make a record in triplicate on a form
24 to be provided by the secretary of state in substantially the
25 following form:
26 Scrap Vehicle Inventory:
1 SELLER: Dealer name ________________________________________
2 Dealer address _____________________________________
3 Dealer license number ______________________________
4 PURCHASER: Conveyed to:_________________________ Date__________
5 (Vehicle scrap metal processor)
6 Dealer address _____________________________________
7 Dealer license number ______________________________
8
9 Vehicles
10 Dealer's
11 Stock
12 Model Year Vehicle Make VIN Title Number Number Color
13 1.________ ____________ ___ ____________ ______ _____
14 2.________ ____________ ___ ____________ ______ _____
15 3.________ ____________ ___ ____________ ______ _____
16 etc.
17 One copy shall be retained as a permanent record by the dealer,
18 1 copy shall be forwarded with the vehicle to be retained by the
19 vehicle scrap metal processor, and 1 copy shall be forwarded to
20 the secretary of state.
21 (19) A person , other than an automotive recycler, used or
22 secondhand vehicle parts dealer, or a foreign salvage dealer,
23 receiving a salvage or
scrap certificate of title shall not
may
24 sell the vehicle to anyone other than 1 of the following:
25 (a) The vehicle's former owner.
26 (b) A used or secondhand vehicle parts dealer.
1 (c) A vehicle scrap metal processor.
2 (d) A foreign salvage vehicle dealer licensed under this
3 act.
4 (e) An automotive recycler.
5 (20) A person receiving a scrap certificate of title shall
6 not sell the vehicle to anyone other than 1 of the following:
7 (a) An automotive recycler.
8 (b) A vehicle scrap metal processor.
9 (c) A foreign salvage vehicle dealer licensed under this
10 act.
11 (d) A used or secondhand vehicle parts dealer. a person
12 licensed under section 248 or a foreign salvage vehicle buyer.
13 (20) (21) The
secretary of state may conduct periodic
14 reviews of the records of a dealer to determine whether adequate
15 notice is given to a transferee or lessee of a rebuilt salvage
16 vehicle of that vehicle's prior designation as a salvage vehicle.
17 The secretary of state may request an insurance company to
18 provide copies of salvage title documents and claims reports
19 involving major component parts to assist the secretary of state
20 in monitoring compliance with this act.
21 (22) A licensed automotive recycler, used or secondhand
22 vehicle parts dealer, vehicle scrap metal processor, vehicle
23 salvage pool operator, distressed vehicle transporter, foreign
24 salvage vehicle dealer, or broker who has removed a scrap vehicle
25 from this state for the purpose of rebuilding the vehicle or
26 selling or leasing the vehicle to a person other than a vehicle
27 scrap metal processor, shall receive an automatic suspension of
1 its dealer license and of any salvage vehicle agent's license
2 assigned to that dealer for a period of 30 days. Upon receipt by
3 the secretary of state of a written request from the dealer, the
4 dealer shall have the right to an immediate hearing on the matter
5 within that 30-day period.
6 (21) (23) For
the purpose of this section, the estimated
7 costs of the repair parts shall be determined by using the
8 current published retail cost of original manufacturer equipment
9 parts or an estimate of the actual cost of the repair parts. The
10 estimated labor costs shall be computed by using the hourly rate
11 and time allocations which are reasonable and commonly assessed
12 in the repair industry in the community where the repairs are
13 performed.
14 (22) (24) A
police agency shall charge a fee for an
15 inspection of a vehicle pursuant to subsection (12). Each local
16 authority with a police agency shall determine the amount of the
17 fee for inspections by that police agency, which shall not exceed
18 $100.00. The police agency shall credit the fee to the budget of
19 that police agency and use the fee for law enforcement purposes
20 that affect stolen vehicles, stolen vehicle parts, and salvage
21 vehicle inspections. A local police agency shall compensate an
22 off-duty and limited enforcement police officer for a salvage
23 vehicle inspection.
24 (23) (25) For
the purpose of this section, "actual cash
25 value" means the retail dollar value of a vehicle as determined
26 by an objective vehicle evaluation using local market resources
27 such as dealers or want ads or by an independent vehicle
1 evaluation or vehicle appraisal service or by a current issue of
2 a nationally recognized used vehicle guide for financial
3 institution appraisal purposes in this state.
4 Sec. 248. (1) The secretary of state shall not grant a
5 dealer license under this section until an investigation is made
6 of the applicant's qualifications under this act, except that
7 this subsection does not apply to license renewals. The secretary
8 of state shall make the investigation within 15 days after
9 receiving the application and make a report on the investigation.
10 (2) An applicant for a new vehicle dealer or a used or
11 secondhand vehicle dealer or broker license shall include a
12 properly executed bond or renewal certificate with the
13 application. If a renewal certificate is used, the bond is
14 considered renewed for each succeeding year in the same amount
15 and with the same effect as an original bond. The bond shall be
16 in the sum of $10,000.00 with good and sufficient surety to be
17 approved by the secretary of state. The bond shall indemnify or
18 reimburse a purchaser, seller, lessee, financing agency, or
19 governmental agency for monetary loss caused through fraud,
20 cheating, or misrepresentation in the conduct of the vehicle
21 business whether the fraud, cheating, or misrepresentation was
22 made by the dealer or by an employee, agent, or salesperson of
23 the dealer. The surety shall make indemnification or
24 reimbursement for a monetary loss only after judgment based on
25 fraud, cheating, or misrepresentation has been entered in a court
26 of record against the licensee. The bond shall also indemnify or
27 reimburse the state for any sales tax deficiency as provided in
1 the general sales tax act, 1933 PA 167, MCL 205.51 to 205.78, or
2 use tax deficiency as provided in the use tax act, 1937 PA 94,
3 MCL 205.91 to 205.111, for the year in which the bond is in
4 force. The surety shall make indemnification or reimbursement
5 only after final judgment has been entered in a court of record
6 against the licensee. A dealer or applicant who has furnished
7 satisfactory proof that a bond similar to the bond required by
8 this subsection is executed and in force is exempt from the bond
9 provisions set forth in this subsection. The aggregate liability
10 of the surety shall not exceed the sum of the bond. The surety on
11 the bond may cancel the bond upon giving 30 days' notice in
12 writing to the secretary of state and thereafter is not liable
13 for a breach of condition occurring after the effective date of
14 the cancellation.
15 (3) An applicant for a new vehicle dealer or a used or
16 secondhand vehicle dealer license shall apply for not less than 2
17 dealer plates as provided by section 245 and shall include with
18 the application the proper fee as provided by section 803.
19 (4) As a condition precedent to the granting of a license, a
20 dealer shall file with the secretary of state an irrevocable
21 written stipulation, authenticated by the applicant, stipulating
22 and agreeing that legal process affecting the dealer, served on
23 the secretary of state or a deputy of the secretary of state, has
24 the same effect as if personally served on the dealer. This
25 appointment remains in force as long as the dealer has any
26 outstanding liability within this state.
27 (5) A person shall not carry on or conduct the business of
1 buying, selling, brokering, leasing, negotiating a lease, or
2 dealing in 5 or more vehicles of a type required to be titled
3 under this act in a 12-month period unless the person obtains a
4 dealer license from the secretary of state authorizing the
5 carrying on or conducting of that business. A person shall not
6 carry on or conduct the business of buying, selling, brokering,
7 leasing, negotiating a lease, or dealing in 5 or more distressed,
8 late model vehicles or salvageable parts to 5 or more of those
9 vehicles in a 12-month period unless the person obtains a used or
10 secondhand vehicle parts dealer ,
an automotive recycler, or a
11 salvage pool license from
the secretary of state or is an
12 insurance company admitted to conduct business in this state. A
13 person shall not carry on or conduct the business of buying 5 or
14 more vehicles in a 12-month period to process into scrap metal or
15 store or display 5 or more vehicles in a 12-month period as an
16 agent or escrow agent of an insurance company unless the person
17 obtains a dealer license from the secretary of state. A vehicle
18 scrap metal processor who does not purchase vehicles or
19 salvageable parts from unlicensed persons is not required to
20 obtain a dealer license. A person from another state shall not
21 purchase, sell, or otherwise deal in distressed, late model
22 vehicles or salvageable parts unless the person obtains a foreign
23 salvage vehicle dealer license from the secretary of state as
24 prescribed under section 248b. A person, including a dealer,
25 shall not purchase or acquire a distressed, late model vehicle or
26 a salvageable part through a salvage pool, auction, or broker
27 without a license as a salvage vehicle agent. The secretary of
1 state shall investigate and seek prosecution, if necessary, of
2 persons allegedly conducting a business without a license. This
3 section does not apply to a foreign salvage vehicle buyer.
4 (6) The application for a dealer license shall be in the
5 form prescribed by the secretary of state and shall be signed by
6 the applicant. In addition to other information as may be
7 required by the secretary of state, the application shall include
8 all of the following:
9 (a) Name of applicant.
10 (b) Location of applicant's established place of business in
11 this state, together with written verification from the
12 appropriate governing or zoning authority that the established
13 place of business meets all applicable municipal and zoning
14 requirements.
15 (c) The name under which business is to be conducted.
16 (d) If the business is a corporation, the state of
17 incorporation.
18 (e) Name, address, date of birth, and social security number
19 of each owner or partner and, if a corporation, the name,
20 address, date of birth, and social security number of each of the
21 principal officers.
22 (f) The county in which the business is to be conducted and
23 the address of each place of business in that county.
24 (g) If new vehicles are to be sold, the make to be handled.
25 Each new vehicle dealer shall send with the application for
26 license a certification that the dealer holds a bona fide
27 contract to act as factory representative, factory distributor,
1 or distributor representative to sell at retail ......... (the
2 make of vehicle to be sold).
3 (h) A statement of the previous history, record, and
4 associations of the applicant and of each owner, partner,
5 officer, and director. The statement shall be sufficient to
6 establish to the satisfaction of the secretary of state the
7 business reputation and character of the applicant.
8 (i) A statement showing whether the applicant has previously
9 applied for a license, the result of the application, and whether
10 the applicant has ever been the holder of a dealer license that
11 was revoked or suspended.
12 (j) If the applicant is a corporation or partnership, a
13 statement showing whether a partner, employee, officer, or
14 director has been refused a license or has been the holder of a
15 license that was revoked or suspended.
16 (k) If the application is for a used or secondhand vehicle
17 parts dealer or an automotive recycler, it shall include all of
18 the following:
19 (i) Evidence that the applicant maintains or will maintain an
20 established place of business.
21 (ii) Evidence that the applicant maintains or will maintain a
22 police book and vehicle parts purchase and sales and lease
23 records as required under this act.
24 (iii) Evidence of worker's compensation insurance coverage for
25 employees classified under the North American industrial
26 classification system number 42114, entitled "motor vehicle parts
27 (used) wholesalers" or under the national council on compensation
1 insurance classification code number 3821, entitled "automobile
2 dismantling and drivers", if applicable.
3 (l) Certification that neither the applicant nor another
4 person named on the application is acting as the alter ego of any
5 other person or persons in seeking the license. For the purpose
6 of this subdivision, "alter ego" means a person who acts for and
7 on behalf of, or in the place of, another person for purposes of
8 obtaining a vehicle dealer license.
9 (7) A person shall apply separately for a dealer license for
10 each county in which business is to be conducted. Before moving 1
11 or more of his or her places of business or opening an additional
12 place of business, a dealer shall apply to the secretary of state
13 for and obtain a supplemental dealer license, for which a fee
14 shall not be charged. A supplemental dealer license shall be
15 issued only for a location, including a tent, temporary stand, or
16 any temporary quarters, that does not meet the definition of an
17 established place of business, within the county in which the
18 dealer's established place of business is located. A dealer
19 license entitles the dealer to conduct the business of buying,
20 selling, leasing, and dealing in vehicles or salvageable parts in
21 the county covered by the license. The dealer license shall also
22 entitle the dealer to conduct at any other licensed dealer's
23 established place of business in this state only the business of
24 buying, selling, leasing, or dealing in vehicles at wholesale.
25 (8) The secretary of state shall classify and differentiate
26 vehicle dealers according to the type of activity they perform. A
27 dealer shall not engage in activities of a particular
1 classification as provided in this act unless the dealer is
2 licensed in that classification. An applicant may apply for a
3 dealer license in 1 or more of the following classifications:
4 (a) New vehicle dealer.
5 (b) Used or secondhand vehicle dealer.
6 (c) Used or secondhand vehicle parts dealer.
7 (d) Vehicle scrap metal processor.
8 (e) Vehicle salvage pool operator.
9 (f) Distressed vehicle transporter.
10 (g) Broker.
11 (h) Foreign salvage vehicle dealer.
12 (h) (i) Automotive
recycler.
13 (i) (j) Beginning April 1, 2005, wholesaler Wholesaler.
14 (9) A dealer license expires on December 31 of the last year
15 for which the license is issued. The secretary of state may renew
16 a dealer license for a period of not more than 4 years upon
17 application and payment of the fee required by section 807.
18 (10) A dealer may conduct the business of buying, selling,
19 or dealing in motor homes, trailer coaches, trailers, or pickup
20 campers at a recreational vehicle show conducted at a location in
21 this state without obtaining a separate or supplemental license
22 under subsection (7) if all of the following apply:
23 (a) The dealer is licensed as a new vehicle dealer or used
24 or secondhand vehicle dealer.
25 (b) The duration of the recreational vehicle show is not
26 more than 14 days.
27 (c) Not less than 14 days before the beginning date of the
1 recreational vehicle show, the show producer notifies the
2 secretary of state, in a manner and form prescribed by the
3 secretary of state, that the recreational vehicle show is
4 scheduled, the location, dates, and times of the recreational
5 vehicle show, and the name, address, and dealer license number of
6 each dealer participating in the recreational vehicle show.
7 Sec. 248c. (1) A vehicle salvage pool or broker shall not
8 sell, transfer, or release a distressed, late model vehicle to
9 anyone other than 1 or more of the following:
10 (a) The vehicle's former owner.
11 (b) A used or secondhand vehicle parts dealer.
12 (c) A vehicle scrap metal processor.
13 (d) A foreign salvage vehicle dealer licensed under this
14 act.
15 (e) A registered motor vehicle repair facility engaging in
16 body work.
17 (2) Subsection (1) applies until July 1, 1994.
18 (3) A vehicle salvage
pool, auction, or broker shall not may
19 sell, transfer, or release a distressed, late model vehicle to
20 anyone other than 1 or more of the following:
21 (a) The vehicle's former owner.
22 (b) A licensed salvage agent of an automotive recycler.
23 (c) A licensed salvage agent of a foreign salvage vehicle
24 dealer.
25 (4) Subsection (3) applies beginning July 1, 1994. the
26 vehicle's former owner, a person licensed under section 248, or a
27 foreign salvage vehicle buyer.
1 Sec. 248f. (1) The secretary of state shall not license a
2 person as a vehicle dealer or salvage vehicle agent before
3 requesting a criminal history check of the person and receiving a
4 criminal history report of the person from both the department of
5 state police and federal bureau of investigation.
6 (2) Each criminal history check required under this section
7 shall be requested, and a criminal history report shall be
8 obtained, from both the department of state police and the
9 federal bureau of investigation.
10 (3) Each person required to be named on an application shall
11 submit his or her fingerprints for a criminal history check to
12 the department of state police in a format as prescribed by the
13 department of state police. The fees required by the department
14 of state police or the federal bureau of investigation, as
15 applicable, to conduct the criminal history check shall accompany
16 a request for a criminal history check.
17 (4) The department of state police shall conduct a criminal
18 history check not more than 45 days after receiving a proper
19 request and the required fee for a criminal history check under
20 this section. After conducting the criminal history check and
21 within the same 45-day period, the department of state police
22 shall provide the secretary of state with a report of the
23 criminal history check. The report shall contain public criminal
24 history record information concerning the person who is the
25 subject of the request that is maintained by the department of
26 state police.
27 (5) If a criminal arrest fingerprint card is subsequently
1 submitted to the department of state police and matches against a
2 fingerprint that was submitted under this section and stored in
3 its automated fingerprint identification system (AFIS) database,
4 the department of state police shall notify the department.
5 (6) Except as otherwise provided in this act, the secretary
6 of state shall not approve an original vehicle dealer or salvage
7 vehicle agent license
before receiving and reviewing the
8 applicable criminal history reports from the department of state
9 police and the federal bureau of investigation.
10 (7) The secretary of state shall use criminal history record
11 information received under this section to evaluate an
12 applicant's qualifications to receive a vehicle dealer or salvage
13 vehicle agent license under
this act. The secretary of state may
14 only discuss a criminal history report or its contents with the
15 following people:
16 (a) Staff of the secretary of state who are involved in
17 determining whether an applicant's vehicle dealer license or
18 salvage vehicle agent license should
be denied, suspended, or
19 revoked.
20 (b) Staff of the department of state police.
21 (c) A person who was involved in the prosecution or defense
22 of a criminal matter noted in a criminal history report.
23 (d) The applicant or his or her attorney.
24 (8) A person who violates subsection (7) is guilty of a
25 misdemeanor punishable by a fine of not more than $10,000.00.
26 (9) As used in this section, "criminal history record
27 information" means that term as defined in section 1a of 1925 PA
1 289, MCL 28.241a.
2 (10) Except for subsection (5), this section does not apply
3 to a person whose criminal history has previously been
4 investigated by the secretary of state and who is applying for
5 the renewal of a vehicle dealer license. or salvage vehicle
agent
6 license.
7 Sec. 249a. (1) The secretary of state may deny the
8 application of a person for a license as an automotive recycler,
9 a used or secondhand vehicle parts dealer, or a vehicle scrap
10 metal processor , or a foreign salvage vehicle dealer and refuse
11 that person a license as an automotive recycler, a used or
12 secondhand vehicle parts dealer, or a vehicle scrap metal
13 processor, or a foreign salvage vehicle dealer, or may suspend
or
14 revoke a license already issued, if the secretary of state finds
15 that 1 or more of the following apply:
16 (a) The applicant or licensee has made a false statement of
17 a material fact in his or her application.
18 (b) The applicant or licensee has not complied with this act
19 or a rule promulgated under this chapter.
20 (c) The applicant or licensee has been convicted of
21 violating Act No. 119 of the Public Acts of 1986, being sections
22 257.1351 to 257.1355 of the Michigan Compiled Laws 1986 PA 119,
23 MCL 257.1351 to 257.1355.
24 (d) If the applicant or licensee is a foreign salvage
25 vehicle dealer, has had his or her dealer license in another
26 state expire, or has had his or her dealer license in another
27 state revoked, suspended, or canceled.
1 (d) (e) If
the applicant or licensee is an automotive
2 recycler , or
a used or secondhand vehicle parts
dealer , or a
3 foreign salvage vehicle dealer and has no established place of
4 business used for the purpose of selling, displaying, or offering
5 for sale used or secondhand vehicle parts or does not have a
6 vehicle dismantling facility or does not have evidence of
7 worker's compensation insurance coverage for employees classified
8 under the standard industrial classification number 4015,
9 entitled "motor vehicle parts—used" or under the national council
10 on compensation insurance code number 3821, entitled "automobile
11 dismantling", if applicable.
12 (2) The secretary of state shall deny the application of a
13 person for a license as an automotive recycler, a used or
14 secondhand vehicle parts dealer, or a vehicle scrap metal
15 processor , or a foreign salvage vehicle dealer and refuse that
16 person a license as an automotive recycler, a used or secondhand
17 vehicle parts dealer, or a vehicle scrap metal processor ,
or a
18 foreign salvage vehicle dealer, or shall suspend or revoke a
19 license already issued, if the secretary of state finds that 1 or
20 more of the following apply:
21 (a) The applicant or licensee has been guilty of a
22 fraudulent act in connection with selling or otherwise dealing in
23 major component parts or vehicles of a type required to be
24 registered under this act.
25 (b) The applicant or licensee has possessed a vehicle or a
26 vehicle part which has been confiscated under section 415 of the
27 Michigan penal code, Act No. 328 of the Public Acts of 1931,
1 being section 750.415 of the Michigan Compiled Laws 1931 PA 328,
2 MCL 750.415. The secretary of state shall conduct a hearing
3 pursuant to the administrative procedures act of 1969, Act No.
4 306 of the Public Acts of 1969, being sections 24.201 to 24.328
5 of the Michigan Compiled Laws 1969 PA 306, MCL 24.201 to 24.328,
6 before the secretary of state takes any action under this
7 subdivision.
8 (c) The applicant or licensee has been convicted under
9 section 413, 415, 535, 535a, or 536a of Act No. 328 of the Public
10 Acts of 1931, being sections 750.413, 750.415, 750.535, 750.535a,
11 and 750.536a of the Michigan Compiled Laws the Michigan penal
12 code, 1931 PA 328, MCL 750.413, 750.415, 750.535, 750.535a, and
13 750.536a, or has been convicted in a foreign state of a law or a
14 local ordinance substantially corresponding to section 413, 415,
15 535, 535a, or 536a of Act No. 328 of the Public Acts of 1931 1 of
16 those sections.
17 (d) The applicant or licensee is a corporation or
18 partnership, and a stockholder, officer, director, or partner of
19 the applicant or licensee has been guilty of any act or omission
20 that would be cause for refusing, revoking, or suspending a
21 license issued to the stockholder, officer, director, or partner
22 as an individual.
23 (e) Effective July 1, 1994, the applicant or licensee has
24 removed a scrap vehicle from this state for the purpose of
25 rebuilding it or has sold or transferred the vehicle as a unit
26 for purposes of rebuilding it.
27 Sec. 251. (1) Each new vehicle dealer, used vehicle dealer,
1 and broker shall maintain a record in a manner prescribed by the
2 secretary of state of each vehicle of a type subject to titling
3 under this act that is bought, sold, leased, or exchanged by the
4 dealer or received or accepted by the dealer for sale, lease, or
5 exchange.
6 (2) Each record shall contain the date of the purchase,
7 sale, lease, or exchange or receipt for the purpose of sale,
8 lease, or exchange, a description of the vehicle, the name and
9 address of the seller, the purchaser or lessee, and the alleged
10 owner or other persons from whom the vehicle was purchased or
11 received, or to whom it was sold, leased, or delivered. The
12 record shall contain a copy of any odometer mileage statement
13 received by the dealer when the dealer purchased or acquired a
14 vehicle and a copy of the odometer mileage statement furnished by
15 the dealer when the dealer sold, leased, or exchanged the vehicle
16 as prescribed in section 233a. If the vehicle is purchased, sold,
17 leased, or exchanged through a broker, the record shall include
18 the broker's name and dealer license number and the amount of the
19 broker's fee, commission, compensation, or other valuable
20 consideration paid by the purchaser or lessee or paid by the
21 dealer, or both. The records of all vehicles purchased, sold,
22 leased, or exchanged through a broker maintained by the secretary
23 of state shall be in an electronic format determined by the
24 secretary of state. A dealer shall retain for not less than 5
25 years each odometer mileage statement the dealer receives and
26 each odometer mileage statement furnished by the dealer upon the
27 sale, lease, or exchange of a vehicle. The description of the
1 vehicle, in the case of a motor vehicle, shall also include the
2 vehicle identification number and other numbers or identification
3 marks as may be on the vehicle, and shall also include a
4 statement that a number has been obliterated, defaced, or
5 changed, if that is the fact. For a trailer or semitrailer, the
6 record shall include the vehicle identification number and other
7 numbers or identification marks as may be on the trailer or
8 semitrailer.
9 (3) Not more than 20 days after the delivery of the vehicle,
10 the seller shall deliver to the buyer in person or by mail to the
11 buyer's last known address a duplicate of a written statement, on
12 a form prescribed by the secretary of state in conjunction with
13 the department of treasury, describing clearly the name and
14 address of the seller, the name and address of the buyer, the
15 vehicle sold to the buyer, the cash sale price of the vehicle,
16 the cash paid down by the buyer, the amount credited the buyer
17 for a trade-in, a description of the trade-in, the amount charged
18 for vehicle insurance, stating the types of insurance covered by
19 the insurance policy, the amount charged for a temporary
20 registration plate, the amount of any other charge and specifying
21 its purpose, the net balance due from the buyer, and a summary of
22 insurance coverage to be affected. If the vehicle sold is a new
23 motor home, the written statement shall contain a description,
24 including the year of manufacture, of every major component part
25 of the vehicle that has its own manufacturer's certificate of
26 origin. The written statement shall disclose if the vehicle sold
27 is a vehicle that the seller had loaned or leased to a political
1 subdivision of this state for use as a driver education vehicle.
2 The written statement shall be dated, but not later than the
3 actual date of delivery of the vehicle to the buyer. The original
4 and all copies of the prescribed form shall contain identical
5 information. The statement shall be furnished by the seller,
6 shall be signed by the seller or the seller's agent and by the
7 buyer, and shall be filed with the application for new title or
8 registration. Failure of the seller to deliver this written
9 statement to the buyer does not invalidate the sale between the
10 seller and the buyer.
11 (4) A retail vehicle sale is void unless both of the
12 following conditions are met:
13 (a) The sale is evidenced by a written memorandum that
14 contains the agreement of the parties and is signed by the buyer
15 and the seller or the seller's agent.
16 (b) The agreement contains a place for acknowledgment by the
17 buyer of the receipt of a copy of the agreement or actual
18 delivery of the vehicle is made to the buyer.
19 (5) Each dealer record and inventory, including the record
20 and inventory of a vehicle scrap metal processor not required to
21 obtain a dealer license, shall be open to inspection by a police
22 officer or an authorized officer or investigator of the secretary
23 of state during reasonable or established business hours.
24 (6) A dealer licensed as a distressed vehicle transporter
25 shall maintain records in a form as prescribed by the secretary
26 of state. The records shall identify each distressed vehicle that
27 is bought, acquired, and sold by the dealer. The record shall
1 identify the person from whom a distressed vehicle was bought or
2 acquired and the dealer to whom the vehicle was sold. The record
3 shall indicate whether a certificate of title or salvage
4 certificate of title was obtained by the dealer for each vehicle.
5 (7) A dealer licensed under this act shall maintain records
6 for a period of 5 years. The records shall be made available for
7 inspection by the secretary of state or other law enforcement
8 officials. To determine or enforce compliance with this chapter
9 or other applicable law, the secretary of state or any law
10 enforcement official may inspect a dealer whenever he or she
11 determines it is necessary. The secretary of state may issue an
12 order summarily suspending the license of a dealer pursuant to
13 section 92 of the administrative procedures act of 1969, 1969 PA
14 306, MCL 24.292, based on an affidavit by a person familiar with
15 the facts set forth in the affidavit that the dealer has failed
16 to maintain the records required by this act or failed to provide
17 the records for inspection as requested by the secretary of
18 state, or has otherwise hindered, obstructed, or prevented the
19 inspection of records authorized under this section. The dealer
20 to whom the order is directed shall comply immediately, but on
21 application to the department shall be afforded a hearing within
22 30 days pursuant to the administrative procedures act of 1969,
23 1969 PA 306, MCL 24.201 to 24.328. On the basis of the hearing,
24 the summary order shall be continued, modified, or held in
25 abeyance not later than 30 days after the hearing.
26 (8) A dealer licensed as a vehicle salvage pool operator or
27 broker shall maintain records in a form as prescribed by the
1 secretary of state. The records shall contain a description of
2 each vehicle or salvageable part stored by the dealer, the name
3 and address of the insurance company or person storing the
4 vehicle or salvageable part, the period of time the vehicle or
5 salvageable part was stored, and the person acquiring the vehicle
6 or salvageable part. In the case of a late model vehicle, a
7 record of the purchase or sale of a major component part of the
8 vehicle shall be maintained identifying the part purchased or
9 sold, the name and address of the seller or purchaser, the date
10 of the purchase or sale, and the identification number assigned
11 to the part by the dealer. The record of the purchase or sale of
12 a part shall be maintained in or attached to the dealer's police
13 book or hard copy of computerized data entries and reference
14 codes and shall be accessible at the dealer's location. In
15 addition, a dealer licensed as a broker shall maintain a record
16 of the odometer mileage reading of each vehicle sold pursuant to
17 an agreement between the broker and the buyer or the broker and
18 the seller. The record of odometer mileage shall be maintained
19 for 5 years and shall contain all of the information required by
20 section 233a.
21 (9) A dealer licensed as a used vehicle parts dealer or an
22 automotive recycler shall maintain records in a form prescribed
23 by the secretary of state. The records shall contain the date of
24 purchase or acquisition of the vehicle, a description of the
25 vehicle including the color, and the name and address of the
26 person from whom the vehicle was acquired. If the vehicle is
27 sold, the record shall contain the date of sale and the name and
1 address of the purchaser. The record shall indicate if the
2 certificate of title or salvage or scrap certificate of title was
3 obtained by the dealer. In the case of a late model vehicle, a
4 record of the purchase or sale of a major component of the
5 vehicle shall be maintained identifying the part purchased or
6 sold, the name and address of the seller or purchaser, the date
7 of the purchase or sale, and the identification number assigned
8 to the part by the dealer, except that a bumper remanufacturer is
9 not required to maintain a record of the purchase of a bumper.
10 However, a bumper remanufacturer shall assign and attach an
11 identification number to a remanufactured bumper and maintain a
12 record of the sale of the bumper. The record of the purchase or
13 sale of a part shall be maintained in or attached to the dealer's
14 police book or hard copy of computerized data entries and
15 reference codes and shall be accessible at the dealer's location.
16 (10) A dealer licensed as a vehicle scrap metal processor
17 shall maintain records as prescribed by the secretary of state.
18 As provided in section 217c, the records shall contain for a
19 vehicle purchased from a dealer a copy of the scrap vehicle
20 inventory, including the name and address of the dealer, a
21 description of the vehicle acquired, and the date of acquisition.
22 If a vehicle is purchased or acquired from a person other than a
23 dealer, the record shall contain the date of acquisition, a
24 description of the vehicle, including the color, the name and
25 address of the person from whom the vehicle was acquired, and
26 whether a certificate of title or salvage or scrap certificate of
27 title was obtained by the dealer.
1 (11) A dealer licensed as a foreign salvage vehicle dealer
2 shall maintain records in a form prescribed by the secretary of
3 state. The records shall contain the date of purchase or
4 acquisition of each distressed vehicle, a description of the
5 vehicle including the color, and the name and address of the
6 person from whom the vehicle was acquired. If the vehicle is
7 sold, the record shall contain the date of sale and the name and
8 address of the purchaser. The record shall indicate if the
9 certificate of title or salvage or scrap certificate of title was
10 obtained by the dealer. In the case of a late model vehicle, a
11 record of the purchase or sale of each salvageable part purchased
12 or acquired in this state shall be maintained and the record
13 shall contain the date of purchase or acquisition of the part, a
14 description of the part, the identification number assigned to
15 the part, and the name and address of the person to or from whom
16 the part was purchased, acquired, or sold. The record of the
17 sale, purchase, or acquisition of a part shall be maintained in
18 the dealer's police book. The police book shall only contain
19 vehicles and salvageable parts purchased in this state or used in
20 the repair of a vehicle purchased in this state. The police book
21 and the records of vehicle part sales, purchases, or acquisitions
22 shall be made available at a location within the state for
23 inspection by the secretary of state within 48 hours after a
24 request by the secretary of state.
25 (11) (12) The
secretary of state shall make periodic
26 unannounced inspections of the records, facilities, and
27 inventories of automotive recyclers and used or secondhand
1 vehicle parts dealers.
2 (12) (13) The
secretary of state may promulgate rules to
3 implement this section pursuant to the administrative procedures
4 act of 1969, 1969 PA 306, MCL 24.201 to 24.328.
5 Sec. 807. (1) Except as provided in subsection (2), an
6 applicant shall include with an application for a license under
7 section 248 one of the following fees:
8 Full year's license................................. $ 75.00
9 Half year's license (after June 30)................. 37.50
10 Multiple year license............................... 75.00
11 per year.
12 (2) An applicant shall include with an application for a
13 used or secondhand vehicle parts dealer , or an
automotive
14 recycler , or foreign salvage vehicle dealer license 1 of the
15 following fees:
16 Full year's license................................. $ 160.00
17 Half year's license (after June 30).................. 80.00
18 Multiple year license................................ 160.00
19 per year.
20 Enacting section 1. Sections 56c, 248b, 248e, 248g, 248h,
21 and 248i of the Michigan vehicle code, 1949 PA 300, MCL 257.56c,
22 257.248b, 257.248e, 257.248g, 257.248h, and 257.248i, are
23 repealed effective October 1, 2009.
24 Enacting section 2. This amendatory act takes effect October
25 1, 2009.
1 Enacting section 3. This amendatory act does not take effect
2 unless Senate Bill No.____ or House Bill No. 6060(request no.
3 01722'09 a) of the 95th Legislature is enacted into law.