186A.190 Security interest notation required on title document -- Notarized
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/ky/186a-190A research copy — for the controlling text, always check the official state or federal source. Not legal advice.
designation of debtor's county of residence provides reliance on and relief
from liability -- Requirements to perfect title on security interest --
Continuation statements -- Determination of debtor's residence when debtor is
other than a natural person -- Discharge of security interest -- Issuance of new
ownership document to creditor in possession upon certain conditions -- Fees --
Electronic transmission of liens.
(1)Except as provided in subsection
(6)of this section and in KRS 355.9-311(4), the
perfection of a security interest in any property for which has been issued a
Kentucky certificate of title shall be by notation on the certificate of title which
shall be deemed to have occurred when the provisions of subsection
(3)of this
section have been complied with. Discharge of a security interest shall be by
notation on the certificate of title. Notation shall be made by the entry of
information required by subsection
(9)of this section into the Automated Vehicle
Information System. The notation of the security interest on the certificate of title
shall be in accordance with this chapter and shall remain effective from the date on
which the security interest is noted on the certificate of title for a period of ten
years, or, in the case of a manufactured home, for a period of thirty
(30)years, or
until discharged under this chapter and KRS Chapter 186. The filing of a
continuation statement within the six
(6)months preceding the expiration of the
initial period of a notation's effectiveness extends the expiration date for five
additional years, commencing on the day the notation would have expired in the
absence of the filing. Succeeding continuation statements may be filed in the same
manner to continue the effectiveness of the initial notation.
(2)A motor vehicle dealer, a secured party or its representative, an assignee of a retail
installment contract lender, the cabinet, or a county clerk shall rely on a county of
residence designated by the debtor on any approved, notarized state form utilized in
lien titling or the title transfer process signed by the debtor. Reliance on the
foregoing by the motor vehicle dealer, secured parties, cabinet, and county clerk
shall relieve those persons from liability to any third party claiming failure to
comply with this section.
(3)Except as provided in subsection
(6)of this section, the notation of security
interests relating to property required to be titled under this chapter in Kentucky
through the cabinet shall be done in the office of a county clerk. The notation of a
security interest shall reflect the county in which the debtor resides as determined
by subsections
(2)and
(4)of this section. The security interest shall be deemed to
be noted on the certificate of title and perfected, or deemed perfected at the time the
security interest attaches as provided in KRS 355.9-203, if in compliance with KRS
186A.195(8), when a title lien statement:
(a)Is received by the county clerk, together with the required fees;
(b)Describes the titled vehicle, or vehicle to be titled, by year, model, make, and
vehicle identification number;
(c)Provides the name of the secured party, or a representative of the secured
party, together with the additional information about the secured party
required by subsection
(9)of this section with reasonable particularity; and
(d)Includes the date and time-stamped entry of the notation of the security
interest by the county clerk of the required information in the Automated
Vehicle Information System (AVIS), or its successor title processing system
maintained by the Division of Motor Vehicle Licensing of the Transportation
Cabinet.
(4)Except as provided in subsection
(6)of this section, if the debtor is other than a
natural person, the following provisions govern the determination of the county of
the debtor's residence:
(a)A partnership shall be deemed a resident of the county in which its principal
place of business in this state is located. If the debtor does not have a place of
business in this state, then the debtor shall be deemed a nonresident for
purposes of filing in this state;
(b)A limited partnership organized under KRS Chapter 362 or as defined in KRS
362.2-102(14) shall be deemed a resident of the county in which its principal
place of business is located, as set forth in its certificate of limited partnership
or most recent amendment thereto filed pursuant to KRS Chapter 362 or
362.2-202. If the office is not located in this state, the debtor shall be deemed
a nonresident for purposes of filing in this state;
(c)A limited partnership not organized under the laws of this state and authorized
to do business in this state shall be deemed a resident of the county in which
the office of its process agent is located, as set forth in the designation or most
recent amendment thereto filed with the Secretary of State of the
Commonwealth of Kentucky;
(d)A corporation organized under KRS Chapter 271B, 273, or 274 or a limited
liability company organized under KRS Chapter 275 shall be deemed a
resident of the county in which its registered office is located, as set forth in
its most recent corporate filing with the Secretary of State which officially
designates its current registered office;
(e)A corporation not organized under the laws of this state, but authorized to
transact or do business in this state under KRS Chapter 271B, 273, or 274, or
a limited liability company not organized under the laws of this state, but
authorized to transact business in this state under KRS Chapter 275, shall be
deemed a resident of the county in which its registered office is located, as set
forth in its most recent filing with the Secretary of State which officially
designates its current registered office;
(f)A cooperative corporation or association organized under KRS Chapter 272
shall be deemed a resident of the county in which its principal business is
transacted, as set forth in its articles of incorporation or most recent
amendment thereto filed with the Secretary of State of the Commonwealth of
Kentucky;
(g)A cooperative corporation organized under KRS Chapter 279 shall be deemed
a resident of the county in which its principal office is located, as set forth in
its articles of incorporation or most recent amendment thereto filed with the
Secretary of State of the Commonwealth of Kentucky;
(h)A business trust organized under KRS Chapter 386 shall be deemed a resident
of the county in which its principal place of business is located, as evidenced
by the recordation of its declaration of trust in that county pursuant to KRS
Chapter 386;
(i)A credit union organized under Subtitle 6 of KRS Chapter 286 shall be
deemed a resident of the county in which its principal place of business is
located, as set forth in its articles of incorporation or most recent amendment
thereto filed with the Secretary of State of the Commonwealth of Kentucky;
and
(j)Any other organization defined in KRS 355.1-201 shall be deemed a resident
of the county in which its principal place of business in this state is located,
except that any limited liability company, limited liability partnership, limited
partnership, or corporation not organized under the laws of this state and not
authorized to transact or do business in this state shall be deemed a
nonresident for purposes of filing in this state. If the organization does not
have a place of business in this state, then it shall be deemed a nonresident for
purposes of filing in this state.
If the debtor does not reside in the Commonwealth, the notation of the security
interest shall be done in the office of the county clerk in which the property is
principally situated or operated. Notwithstanding the existence of any filed
financing statement under the provisions of KRS Chapter 355 relating to any
property registered or titled in Kentucky, the sole means of perfecting and
discharging a security interest in property for which a certificate of title is required
by this chapter is by notation on the property's certificate of title under the
provisions of this chapter or in accordance with the provisions of KRS 186.045(3).
In other respects the security interest is governed by the provisions of KRS Chapter
355.
(5)Except as provided in subsection
(6)of this section, before ownership of property
subject to a lien evidenced by notation on the certificate of title may be transferred,
the transferor shall obtain the release of the prior liens in his or her name against the
property being transferred. Once a security interest has been noted on the owner's
title, a subsequent title shall not be issued by any county clerk free of the notation
unless it has been noted in the system of record established under KRS 186A.195
that the security interest has been discharged. If this requirement is met, information
relating to any security interest shown on the title as having been discharged may be
omitted from the title to be issued by the clerk. If information relating to the
discharge of a security interest is presented to a clerk under the provisions of KRS
186.045(3), the clerk shall discharge the security interest and remove the lien
information from AVIS.
(6)Notwithstanding subsections
(1)to
(5)of this section, a county clerk shall,
following inspection of the vehicle by the sheriff, to determine that the vehicle has
not been stolen, issue a new ownership document to a vehicle, clear of all prior
liens, to a person after he or she provides to the county clerk an affidavit devised by
the Transportation Cabinet and completed by the person. The ownership document
presented as a result of this affidavit shall be in accordance with subsection
(7)of
this section. In the affidavit, the affiant shall attest that:
(a)The affiant or the agent of the affiant possesses the vehicle;
(b)Before he or she provided the notices required by paragraphs
(c)and
(d)of
this subsection:
1. A debt on the vehicle has been owed him or her for more than thirty
days;
2. Within thirty
(30)days of payment of damages by an insurance
company and receipt by the current owner of the motor vehicle or
lienholder of damages pursuant to a claim settlement which required
transfer of the vehicle to the insurance company, the insurance company
has been unable to obtain:
a. A properly endorsed certificate of title on the vehicle from the
current owner; and
b. If applicable, any lien satisfactions; or
3. a. The vehicle was voluntarily towed or transported pursuant to a
request of the current owner or an insurance company that a motor
vehicle dealer, licensed as a used motor vehicle dealer and motor
vehicle auction dealer, take possession of and store the motor
vehicle in the regular course of business; and
b. Within forty-five
(45)days of taking possession of the motor
vehicle, the motor vehicle dealer has not been paid storage fees by
the current owner or lienholder and has not been provided both a
properly endorsed certificate of title and if applicable, any lien
satisfactions;
(c)More than thirty
(30)days before presenting the affidavit to the county clerk,
the affiant attempted to notify the owner of the vehicle and all known
lienholders, including those noted on the title, by certified mail, return receipt
requested, or by a nationally recognized courier service, of his or her name,
address, and telephone number as well as his or her intention to obtain a new
title or salvage title, as applicable, clear of all prior liens, unless the owner or
a lienholder objects in writing;
(d)More than fourteen
(14)days before presenting the affidavit to the county
clerk, the affiant had published a legal notice stating his or her intention to
obtain title to the vehicle. The legal notice appeared at least twice in a seven
(7)day period in a newspaper with circulation in the county. The legal notice
stated:
1. The affiant's name, address, and telephone number;
2. The owner's name;
3. The names of all known lienholders, including those noted on the title;
4. The vehicle's make, model, and year; and
5. The affiant's intention to obtain title to the vehicle unless the owner or a
lienholder objects in writing within fourteen
(14)days after the last
publication of the legal notice; and
(e)Neither the owner nor a lienholder has objected in writing to the affiant's right
to obtain title to the vehicle.
(a)If subsection (6)(b)1. of this section applies, the new ownership document
shall be a title.
(b)If subsection (6)(b)2. or 3. of this section applies, the new ownership
document shall be a salvage title if the vehicle meets the requirements for a
salvage title as stated in KRS 186A.520(1)(a).
(c)If subsection (6)(b)2. or 3. of this section applies and the vehicle does not
meet the requirements for a salvage title as stated in KRS 186A.520(1)(a), the
new ownership document shall be a title.
(8)No more than two
(2)active security interests may be noted upon a certificate of
title.
(9)In noting a security interest upon a certificate of title, the county clerk shall ensure
that the certificate of title bears the lienholder's name, mailing address and zip code,
the date the lien was noted, the notation number, and the county in which the
security interest was noted. The clerk shall obtain the information required by this
subsection for notation upon the certificate of title from the title lien statement
described in KRS 186A.195.
(10)For all the costs incurred in the notation and discharge of a security interest on the
certificate of title, the county clerk shall receive the fee prescribed by KRS 64.012.
The fee prescribed by this subsection shall be paid at the time of submittal of the
title lien statement described in KRS 186A.195.
(11)A copy of the application, certified by the county clerk, indicating the lien will be
noted on the certificate of title shall be forwarded to the lienholder.
(a)Any lien or security interest filed under this chapter may be electronically
transmitted to the cabinet through the electronic title application and
registration system.
(b)Notwithstanding the provisions of this section and KRS 186A.015 and
186A.074 that require a lien to be noted on the face of the title, if there are
one
(1)or more liens on a motor vehicle, the cabinet may electronically notify
the first lienholder of any additional liens.
(c)Subsequent lien satisfactions may be electronically transmitted to the cabinet
and shall include the name and address of the person satisfying the lien.
(d)When liens and lien satisfactions are electronically transmitted, a clean
certificate of title shall not be issued until the last lien is satisfied.
(e)A duly certified copy of the cabinet's electronic record of the lien shall be
admissible in any civil, criminal, or administrative proceedings in this state as
evidence of the existence of the lien.
(13)If a security interest expires without being renewed, the cabinet shall remove the
lien from the certificate of title in the AVIS system.