                                 CODE OF VIRGINIA

ENFORCEMENT OF LIENS ACQUIRED UNDER §§ 46.2-644.01 AND 46.2-644.02 (§
46.2-644.03)

A. For the purposes of this section:
			&#8220;Bailee&#8221; means anyone who has one or more liens under &#xA7;
46.2-644.01 or 46.2-644.02.
			&#8220;Independent appraisal&#8221; means an estimate for the value of a
motor vehicle prepared by an individual or business that (i) has all required
business licenses and zoning approvals and (ii) is either a licensed appraiser
in another state or a business authorized by an insurance company to prepare
insurance appraisals. &#8220;Independent appraisal&#8221; does not include an
estimate prepared by an individual or business with a financial interest in the
bailee&#8217;s business.

B. Any bailee eligible to enforce a lien under &#xA7; 46.2-644.01 or
46.2-644.02, if the value of the vehicle affected by the lien does not exceed
$12,500, may sell such vehicle by public auction, for cash, in accordance with
the provisions of this section. The proceeds shall be applied to the
satisfaction of the debt and expenses of sale, and the surplus, if any, shall be
paid within 30 days of the sale to any lienholder of record, and then to the
owner of the vehicle, provided such lienholder or owner contacts the bailee
prior to the sale to claim any surplus that may result. If such claim is made by
the lienholder or owner within 30 days following the sale, the surplus shall be
paid within 30 days of the claim. If no claim to the surplus is made within 30
days of the sale, or if the owner or lienholder cannot be ascertained by the
Department, the bailee shall be entitled to keep the surplus.

C. Before any lien may be enforced under this section, the bailee or his
authorized agent shall initiate with the Department, in a manner prescribed by
the Commissioner, a search for the owner and lienholder of record for the
vehicle, the names and addresses of which if found shall be provided to the
bailee. Any bailee or authorized agent who initiates more than five such
requests within any 12-month period shall enter into an agreement with the
Department to initiate requests and receive responses electronically.
			The Department shall check (i) its own records, (ii) the records of a
nationally recognized crime database, and (iii) records of a nationally
recognized motor vehicle title database for owner and lienholder information. If
a vehicle has been reported stolen, the Department shall notify the appropriate
law-enforcement agency of that fact. If a vehicle is found to have been titled
in another jurisdiction, the Department shall contact that jurisdiction to
ascertain the requested information and provide it to the bailee. At the time of
the search, the Department shall also determine the value of the vehicle, using
the trade-in value specified in a recognized pricing guide, and, for a vehicle
titled in the Commonwealth, whether the records of the Department show that the
owner of the vehicle has indicated that he is on active military duty or
service. The Department shall include such information in the response to the
request for vehicle information.
			After responding to the request for vehicle information, the Department shall
notify the owner and any lienholder of record of the request by first-class mail
to the address provided on the vehicle record held by the Department or by the
jurisdiction in which the vehicle is titled. Such notice shall include the name
and contact information of the bailee and any terms for reclaiming the vehicle,
as well as any additional information the Commissioner determines to be
necessary.
			No notice by the Department shall be required if no record for the vehicle
can be found or, in the case of a vehicle titled in another jurisdiction, the
other jurisdiction refuses to release the requested vehicle information to the
Department. In either situation, the bailee may continue with lien enforcement
under this section. However, if a vehicle record exists in another jurisdiction,
the bailee shall assume all liability for proceeding with such enforcement
without written notice to the owner and/or lienholder of record.
			For every vehicle subject to a record search as provided for in this section,
if the record for the vehicle is held by the Department, the Department shall
place an administrative hold on the vehicle record until the bailee reports to
the Department that the vehicle has been reclaimed or sold pursuant to this
section.

D. Any bailee enforcing a lien in accordance with this section shall notify the
Department of his intent to sell the vehicle in a manner prescribed by the
Commissioner. A $40 fee shall be paid to the Department at the time of notice.
Upon receipt of such notice and fee, the Department shall repeat the vehicle
record search prescribed in subsection A for the purpose of confirming the most
recent owner and lienholder information for the vehicle.
			If the Department confirms owner or lienholder information, either through a
search of its own records or those of another jurisdiction, the Department shall
notify the owner, at the last known address of record, and any lienholder, at
the last known address of record, of the intent to sell the vehicle, by
certified mail, return receipt requested, and advise them to reclaim the vehicle
and repay the debt owed within 15 days from the date the notice was sent. Such
notice, when sent in accordance with these requirements, shall be sufficient
regardless of whether or not it was ever received.
			Following the notice required in this subsection, if the vehicle remains
unclaimed and the debt unpaid, the owner and all persons having security
interest shall have waived all right, title, and interest in the vehicle, except
to the extent that subsection B requires a surplus to be paid. The bailee shall
notify the Department in a manner prescribed by the Commissioner within five
business days if the vehicle is reclaimed and the debt paid. Should the bailee
fail to notify the Department as required herein, and the Department must remove
the administrative hold placed under subsection C at the request of the vehicle
owner or lienholder, and upon submission of proof that the debt was paid and the
vehicle reclaimed, the Department may impose and collect an administrative fee
of $40 from the bailee for each such removal.

E. At the time the bailee notifies the Department of his intent to sell the
motor vehicle, the bailee shall provide the intended date of sale at public
auction, including the time, place, and terms of such sale. The intended date
shall be at least 21 days after the date of notification. The Department shall
post notice on behalf of the bailee for at least 21 days prior to the date of
sale, advertising the time, place, and terms of the sale. Such 21-day posting
period shall run concurrently with the 15-day reclamation period provided for in
subsection D. Notifications and postings shall be in an electronic manner
prescribed by the Commissioner and shall include the vehicle identification
number and a description of each vehicle to be sold. No other postings or
notices advertising the sale shall be required.
			Upon notice by the bailee that the vehicle will be sold, the Department shall
provide a certification document in a manner prescribed by the Commissioner to
the bailee. The bailee shall complete all applicable certification statements on
the document and provide it to the buyer of the vehicle, who shall submit the
document and an application to the Department in order to obtain a certificate
of title for the vehicle. Upon receipt of a completed application and
certification document, the Department shall issue a certificate of title to the
buyer or a nonrepairable certificate, if requested, free of all prior liens and
claims of ownership of others.

F. If the value of the vehicle is more than $12,500 but does not exceed $25,000,
the bailee, after the notice is sent by the Department pursuant to subsection C,
may apply by petition to any general district court of the county or city
wherein the vehicle is, or, if the value of the vehicle exceeds $25,000, to the
circuit court of the county or city, for the sale of the vehicle. No notice sent
by the Department pursuant to this section shall substitute for service of
process for any court proceeding. If the name of the owner cannot be
ascertained, the name &#8220;John Doe&#8221; shall be substituted in any
proceeding pursuant to this section.
			If, on the hearing of the case on the petition, the defense, if any made
thereto, and such evidence as may be adduced by the parties respectively, the
court is satisfied that the debt and lien are established and the vehicle should
be sold to pay the debt, the court shall order the sale to be made by the
sheriff of the county or city. The sheriff shall make the same and apply and
dispose of the proceeds in the same manner as if the sale were made under a writ
of fieri facias. No additional notifications or postings by the Department
related to the sale shall be required.
			If a court has ordered the sale of the vehicle, the bailee shall submit to
the Department a copy of the court order in a manner prescribed by the
Commissioner. Upon receipt, the Department shall provide a certification
document to the bailee. The bailee and sheriff conducting the sale, or his
authorized representative, shall complete all applicable certification
statements on the document and provide it to the buyer of the vehicle, who shall
submit the document and an application to the Department in order to obtain a
certificate of title for the vehicle. Upon receipt of a completed application
and certification document, the Department shall issue a certificate of title to
the buyer or a nonrepairable certificate, if requested, free of all prior liens
and claims of ownership of others.

G. In determining the value of the property as required by this section, the
Commissioner shall use a recognized pricing guide and, in using such guide,
shall use the trade-in value specified in such guide.
			However, the bailee may submit an independent appraisal and supporting
documentation to show the accurate value of the vehicle in a manner prescribed
by the Commissioner. Upon receipt, the Department shall update the vehicle
record to reflect the value established by the independent appraisal and notify
the bailee that enforcement under this section may proceed based on the new
value.
			If the Department is unable to determine a trade-in value for a vehicle, the
Commissioner may establish guidelines for acceptable alternate valuation options
to include independent appraisals and retail or loan values that may be
available in online or printed pricing guides. The bailee may submit
documentation pursuant to such guidelines in order to establish the value of the
vehicle.

H. For a vehicle (i) for which neither the owner nor any other lienholder or
secured party can be determined by the Department through a diligent search as
required by this section, (ii) manufactured for a model year at least six years
prior to the current model year, and (iii) having a value of no more than $4,500
as determined by the provisions of this section, a bailee may, after showing
proof that the vehicle has been in his continuous custody for at least 30 days,
apply for and receive from the Department of Motor Vehicles title or a
nonrepairable certificate to such vehicle, free of all liens and claims of
ownership of others, and proceed to sell or otherwise dispose of the vehicle.

I. Notwithstanding any provisions to the contrary, a bailee shall comply with
the provisions of the federal Servicemembers Civil Relief Act (50 U.S.C. &#xA7;
3901 et seq.) (the Act) when disposing of a vehicle owned by a member of the
military on active duty or service. If the records of the Department show that
the owner of the vehicle has indicated to the Department that he is on active
military duty or service, such indicator shall be prima facie evidence that the
vehicle is subject to the provisions of the Act. However, neither the presence
nor absence of such indicator on the vehicle record shall absolve the bailee of
his obligation to ascertain the owner&#8217;s military service status, if any,
in accordance with the Act.

J. All fees imposed and collected pursuant to this section shall be paid into
the state treasury and set aside as a special, nonreverting fund to be used to
meet the expenses of the Department.

K. Residents or businesses of other jurisdictions in possession of vehicles
titled in the Commonwealth, or the authorized agents of such residents or
businesses, seeking to enforce laws in those jurisdictions that are
substantially similar to the enforcement of liens under &#xA7;&#xA7; 46.2-644.01
and 46.2-644.02 may request information for such vehicles from the Department.
The Department shall conduct the information search as provided for in
subsection C, provide the names and addresses of the owner and lienholder, if
any, for each vehicle to the requester, and notify the named owner and
lienholder, if any, by first-class mail of the request. Such notification shall
not replace any notification requirements imposed by the jurisdiction in which
the requester and subject vehicle are located, nor shall the enforcement rules
of this section apply to vehicles not located within the Commonwealth. If the
Department finds that the vehicle is titled in another jurisdiction, the
Department shall identify that jurisdiction to the requester with no further
obligation to the requester or vehicle owner. The Department shall collect a $25
fee for such search.

HISTORY: 2009, c. 664; 2011, cc. 14, 702; 2014, c. 339; 2015, c. 640; 2016, c.
397; 2019, c. 560; 2021, Sp. Sess. I, c. 374.