AN ACT TO STRENGTHEN THE MOTOR VEHICLE CERTIFICATE OF TITLE LAWS BY PROVIDING FOR A MANUFACTURER'S CERTIFICATE OF TRANSFER FOR NEW MOTOR VEHICLES AND FOR THE RECORDATION AND PERFECTION OF SECURITY INTERESTS IN VEHICLES.
WHEREAS, the present motor vehicle certificate of title law provides for a declaration of all existing liens at the time of application for registration, but does not require that liens given thereafter be declared and entered on the certificate of title; and
WHEREAS, the certificate of title, often regarded as absolute, is not conclusive as to liens and may not be relied upon to show good title for purpose of sale or encumbrance, except as it relates to lien perfection under Section 213 of the Interstate Commerce Act; that is, liens on equipment of interstate common and contract carriers; and
WHEREAS, the present certificate of title law does not meet the requisites of the Uniform Title Code because the certificate of title is not in and of itself adequate notice to third parties of existing liens; and
WHEREAS, a certificate of title that can be relied upon as a ready means by which all legal interests in motor vehicles may be determined would be to the public interest: Now, therefore,
The General Assembly of North Carolina do enact:
Section 1. G.S. 20‑38 is hereby amended by adding at the end thereof three new subsections to be designated subsections (hh), (ii) and (jj) to read as follows:
"(hh) Security agreement. A written agreement which reserves or creates a security interest.
"(ii) Security interest. An interest in a vehicle reserved or created by agreement and which secures payment or performance of an obligation. The term includes but is not limited to the interest of a chattel mortgagee, the interest of a vendor under a conditional sale contract, the interest of a trustee under a chattel deed of trust, and the interest of a lessor under a lease intended as security. A security interest is 'perfected' when it is valid against third parties generally,
"(jj) Manufacturer's certificate. A certification, on a form approved by the Department of Motor Vehicles, signed by the manufacturer, indicating the name of the person or dealer to whom the therein described vehicle is transferred, the date of transfer and that such vehicle is the first transfer of such vehicle in ordinary trade and commerce. The description of the vehicle shall include the make, model, year, type of body, identification number or numbers, and such other information as the Department may require."
Sec. 2. G.S. 20‑52(a) is hereby amended by rewriting subdivision 3 thereof to read as follows:
"3. A statement of the applicant's title and of all liens or encumbrances upon said vehicle and the names and addresses of all lien holders in the order of their priority, and the amount, date and nature of the security agreement."
Sec. 3. G.S. 20‑52(b) is hereby rewritten to read as follows:
"(b) When such application refers to a new vehicle purchased from a manufacturer or dealer, such application shall be accompanied with a manufacturer's certificate of origin that is properly assigned to the applicant. If the new vehicle is acquired from a dealer or person located in another jurisdiction other than a manufacturer, the application shall be accompanied with such evidence of ownership as is required by the laws of that jurisdiction duly assigned by the disposer to the purchaser, or, if no such evidence of ownership be required by the laws of such other jurisdiction, a notarized bill of sale from the disposer."
Sec. 4. Chapter 20 of the General Statutes is hereby amended by inserting following G.S. 20‑52 a new Section to be designated G.S. 20‑52.1 and to read as follows: