1.1                          A bill for an act
  1.2             relating to liens; motor vehicles towed at the request 
  1.3             of law enforcement; clarifying the extent of the lien; 
  1.4             providing for notice to the owner of towing, sale, and 
  1.5             right to reclaim; proposing coding for new law in 
  1.6             Minnesota Statutes, chapter 514; repealing Minnesota 
  1.7             Statutes 1998, section 514.18, subdivision 1a. 
  1.8   BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.9      Section 1.  [514.185] [MOTOR VEHICLE TOWED AT LAW 
  1.10  ENFORCEMENT REQUEST.] 
  1.11     Subdivision 1.  [LIEN.] A person who tows and stores a 
  1.12  motor vehicle at the request of a law enforcement officer has a 
  1.13  lien on the motor vehicle, which does not extend to the contents 
  1.14  of the vehicle, for the value of the storage and towing and the 
  1.15  right to retain possession of the motor vehicle until the lien 
  1.16  is lawfully discharged.  This section does not apply to tows 
  1.17  authorized in section 169.041, subdivision 4, clause (1). 
  1.18     Subd. 2.  [CONTENTS; NOTICE WITHIN FIVE DAYS.] When a 
  1.19  vehicle is towed and stored under this section, the person doing 
  1.20  the storing shall give notice of the towing and storage within 
  1.21  five days.  The notice shall: 
  1.22     (1) set forth the date and place of the towing, the year, 
  1.23  make, model, and serial number of the vehicle if the information 
  1.24  can be reasonably obtained, and the place where the vehicle is 
  1.25  being held; 
  1.26     (2) inform the owner and a secured party or lessor of the 
  2.1   right to reclaim the vehicle under this section by paying the 
  2.2   costs of towing and storage; 
  2.3      (3) inform the owner of the right to collect the contents 
  2.4   of the vehicle without reclaiming the vehicle itself; and 
  2.5      (4) state that failure of the owner or a secured party or 
  2.6   lessor to exercise the right to reclaim the vehicle and contents 
  2.7   within 45 days constitutes a waiver of all right, title, and 
  2.8   interest in the vehicle and contents and a consent to the 
  2.9   transfer of title to, and sale or disposal of, the vehicle and 
  2.10  contents pursuant to this section. 
  2.11     Subd. 3.  [NOTICE BY MAIL OR PUBLICATION.] The notice shall 
  2.12  be sent by mail to the registered owner, if any, of a towed 
  2.13  vehicle and to all readily identifiable secured parties and 
  2.14  lessors of record. The department of public safety shall make 
  2.15  this information available to persons who request it for 
  2.16  notification purposes under this section.  If it is impossible 
  2.17  to determine with reasonable certainty the identity and address 
  2.18  of the registered owner and all secured parties and lessors, the 
  2.19  notice shall be published once in a newspaper of general 
  2.20  circulation in the area where the motor vehicle was towed.  
  2.21  Published notices may be grouped together for convenience and 
  2.22  economy. 
  2.23     Subd. 4.  [PAYMENT OF CHARGES.] The owner or any secured 
  2.24  party or lessor of a vehicle towed and stored under this section 
  2.25  shall have a right to reclaim the vehicle from the person who 
  2.26  towed and stored it upon payment of all towing and storage 
  2.27  charges.  The owner must reclaim the vehicle and pay the towing 
  2.28  and storage costs within 45 days after the date of the notice 
  2.29  required by subdivision 2. 
  2.30     Subd. 5.  [AUCTION OR SALE.] (a) A vehicle and contents 
  2.31  towed and stored under this section and not reclaimed as 
  2.32  provided under subdivision 4, may be sold at auction or sale or 
  2.33  disposed of under subdivision 6.  A vehicle encumbered by a bona 
  2.34  fide security interest or subject to a lease that has a term of 
  2.35  180 days or more is subject to the interest of the secured party 
  2.36  or lessor. 
  3.1      (b) If the proceeds of the sale exceed the outstanding loan 
  3.2   balance on the vehicle, the proceeds from the sale of the 
  3.3   vehicle are to be applied in the following order of priority: 
  3.4      (1) payment of the towing, storage, and selling costs of 
  3.5   the person who towed the vehicle; 
  3.6      (2) satisfaction of valid liens against the vehicle; and 
  3.7      (3) any remainder to the owner of the vehicle. 
  3.8      If the proceeds of the sale do not equal or exceed the 
  3.9   outstanding loan balance, the proceeds are to be remitted to the 
  3.10  secured party or lessor. 
  3.11     (c) The purchaser shall be given a receipt in a form 
  3.12  prescribed by the registrar of motor vehicles which is 
  3.13  sufficient title to dispose of the vehicle.  If the secured 
  3.14  party's or lessor's lien is satisfied, the receipt also entitles 
  3.15  the purchaser to register the vehicle and receive a certificate 
  3.16  of title, free and clear of all liens and claims of ownership. 
  3.17     Subd. 6.  [UNSOLD VEHICLE.] A vehicle not reclaimed by its 
  3.18  owner or a secured party or lessor under this section or sold 
  3.19  pursuant to this section may be disposed of as scrap metal by 
  3.20  the person who towed and stored it. 
  3.21     Sec. 2.  [REPEALER.] 
  3.22     Minnesota Statutes 1998, section 514.18, subdivision 1a, is 
  3.23  repealed.