California Codes on Repossessions:
1. Impounded Vehicles:
Documentation Requirement - CVC 14602.6 - CVC 14602.7 (notarization not required)
Impound Releases - CVC 22850.5
2. 30 Day Impound Holds: C.V.C 14602.6 (f) A vehicle removed and seized under subdivision (a) shall be released to the legal owner of the vehicle or the legal owner's agent prior to the end of 30 days' impoundment if all of the following conditions are met:
(1) The legal owner is a motor vehicle dealer, bank, credit union, acceptance corporation, or other licensed financial institution legally operating in this state or is another person, not the registered owner, holding a security interest in the vehicle.
(2)(A) The legal owner or the legal owner's agent pays all towing and storage fees related to the seizure of the vehicle. No lien sale processing fees shall be charged to the legal owner who redeems the vehicle prior to the 15th day of impoundment. Neither the impounding authority nor any person having possession of the vehicle shall collect from the legal owner of the type specified in paragraph (1), or the legal owner's agent any administrative charges imposed pursuant to Section 22850.5 unless the legal owner voluntarily requested a poststorage hearing.
(B) A person operating or in charge of a storage facility where vehicles are stored pursuant to this section shall accept a valid bank credit card or cash for payment of towing, storage, and related fees by a legal or registered owner or the owner's agent claiming the vehicle. A credit card shall be in the name of the person presenting the card. “Credit card” means “credit card” as defined in subdivision (a) of Section 1747.02 of the Civil Code, except, for the purposes of this section, credit card does not include a credit card issued by a retail seller.
(C) A person operating or in charge of a storage facility described in subparagraph (B) who violates subparagraph (B) shall be civilly liable to the owner of the vehicle or to the person who tendered the fees for four times the amount of the towing, storage, and related fees, but not to exceed five hundred dollars ($500).
(D) A person operating or in charge of a storage facility described in subparagraph (B) shall have sufficient funds on the premises of the primary storage facility during normal business hours to accommodate, and make change in, a reasonable monetary transaction.
(E) Credit charges for towing and storage services shall comply with Section 1748.1 of the Civil Code. Law enforcement agencies may include the costs of providing for payment by credit when making agreements with towing companies on rates.
(3) The legal owner or the legal owner's agent presents a copy of the assignment, as defined in subdivision (b) of Section 7500.1 of the Business and Professions Code; a release from the one responsible governmental agency, only if required by the agency; a government-issued photographic identification card; and any one of the following, as determined by the legal owner or the legal owner's agent: a certificate of repossession for the vehicle, a security agreement for the vehicle, or title, whether paper or electronic, showing proof of legal ownership for the vehicle. Any documents presented may be originals, photocopies, or facsimile copies, or may be transmitted electronically. The law enforcement agency, impounding agency, or any other governmental agency, or any person acting on behalf of those agencies, shall not require any documents to be notarized. The law enforcement agency, impounding agency, or any person acting on behalf of those agencies may require the agent of the legal owner to produce a photocopy or facsimile copy of its repossession agency license or registration issued pursuant to Chapter 11 (commencing with Section 7500) of Division 3 of the Business and Professions Code, or to demonstrate, to the satisfaction of the law enforcement agency, impounding agency, or any person acting on behalf of those agencies, that the agent is exempt from licensure pursuant to Section 7500.2 or 7500.3 of the Business and Professions Code.
No administrative costs authorized under subdivision (a) of Section 22850.5 shall be charged to the legal owner of the type specified in paragraph (1), who redeems the vehicle unless the legal owner voluntarily requests a poststorage hearing. No city, county, city and county, or state agency shall require a legal owner or a legal owner's agent to request a poststorage hearing as a requirement for release of the vehicle to the legal owner or the legal owner's agent. The law enforcement agency, impounding agency, or other governmental agency, or any person acting on behalf of those agencies, shall not require any documents other than those specified in this paragraph. The law enforcement agency, impounding agency, or other governmental agency, or any person acting on behalf of those agencies, shall not require any documents to be notarized. The legal owner or the legal owner's agent shall be given a copy of any documents he or she is required to sign, except for a vehicle evidentiary hold logbook. The law enforcement agency, impounding agency, or any person acting on behalf of those agencies, or any person in possession of the vehicle, may photocopy and retain the copies of any documents presented by the legal owner or legal owner's agent.
(4) A failure by a storage facility to comply with any applicable conditions set forth in this subdivision shall not affect the right of the legal owner or the legal owner's agent to retrieve the vehicle, provided all conditions required of the legal owner or legal owner's agent under this subdivision are satisfied.
4. Repair Shop Fees & Storage: CA Civil Code 3068
(a) Every person has a lien dependent upon possession for the compensation to which the person is legally entitled for making repairs or performing labor upon, and furnishing supplies or materials for, and for the storage, repair, or safekeeping of, and for the rental of parking space for, any vehicle of a type subject to registration under the Vehicle Code, subject to the limitations set forth in this chapter. The lien shall be deemed to arise at the time a written statement of charges for completed work or services is presented to the registered owner or 15 days after the work or services are completed, whichever occurs first. Upon completion of the work or services, the lienholder shall not dismantle, disengage, remove, or strip from the vehicle the parts used to complete the work or services.
(b)
(1) Any lien under this section that arises because work or services have been performed on a vehicle with the consent of the registered owner shall be extinguished and no lien sale shall be conducted unless either of the following occurs:
(A) The lienholder applies for an authorization to conduct a lien sale within 30 days after the lien has arisen.
(B) An action in court is filed within 30 days after the lien has arisen.
(2) A person whose lien for work or services on a vehicle has been extinguished shall turn over possession of the vehicle, at the place where the work or services were performed, to the legal owner or the lessor upon demand of the legal owner or lessor, and upon tender by the legal owner or lessor, by cashier's check or in cash, of only the amount for storage, safekeeping, or parking space rental for the vehicle to which the person is entitled by subdivision (c).
(3) Any lien under this section that arises because work or services have been performed on a vehicle with the consent of the registered owner shall be extinguished, and no lien sale shall be conducted, if the lienholder, after written demand made by either personal service or certified mail with return receipt requested by the legal owner or the lessor to inspect the vehicle, fails to permit that inspection by the legal owner or lessor, or his or her agent, within a period of time not sooner than 24 hours nor later than 72 hours after the receipt of that written demand, during the normal business hours of the lienholder.
(4) Any lien under this section that arises because work or services have been performed on a vehicle with the consent of the registered owner shall be extinguished, and no lien sale shall be conducted, if the lienholder, after written demand made by either personal service or certified mail with return receipt requested by the legal owner or the lessor to receive a written copy of the work order or invoice reflecting the services or repairs performed on the vehicle and the authorization from the registered owner requesting the lienholder to perform the services or repairs, fails to provide that copy to the legal owner or lessor, or his or her agent, within 10 days after the receipt of that written demand.
(c) The lienholder shall not charge the legal owner or lessor any amount for release of the vehicle in excess of the amounts authorized by this subdivision.
(1) That portion of the lien in excess of one thousand five hundred dollars ($1,500) for any work or services, or that amount, subject to the limitations contained in Section 10652.5 of the Vehicle Code, in excess of one thousand twenty-five dollars ($1,025) for any storage, safekeeping, or rental of parking space or, if an application for an authorization to conduct a lien sale has been filed pursuant to Section 3071 within 30 days after the commencement of the storage or safekeeping, in excess of one thousand two hundred fifty dollars ($1,250) for any storage or safekeeping, rendered or performed at the request of any person other than the legal owner or lessor, is invalid, unless prior to commencing any work, services, storage, safekeeping, or rental of parking space, the person claiming the lien gives actual notice in writing either by personal service or by registered letter addressed to the legal owner named in the registration certificate, and the written consent of that legal owner is obtained before any work, services, storage, safekeeping, or rental of parking space are performed.
(2) Subject to the limitations contained in Section 10652.5 of the Vehicle Code, if any portion of a lien includes charges for the care, storage, or safekeeping of, or for the rental of parking space for, a vehicle for a period in excess of 60 days, the portion of the lien that accrued after the expiration of that period is invalid unless Sections 10650 and 10652 of the Vehicle Code have been complied with by the holder of the lien.
(3) The charge for the care, storage, or safekeeping of a vehicle which may be charged to the legal owner or lessor shall not exceed that for one day of storage if, 24 hours or less after the vehicle is placed in storage, a request is made for the release of the vehicle. If the request is made more than 24 hours after the vehicle is placed in storage, charges may be imposed on a full, calendar-day basis for each day, or part thereof, that the vehicle is in storage.
(d) In any action brought by or on behalf of the legal owner or lessor to recover a vehicle alleged to be wrongfully withheld by the person claiming a lien pursuant to this section, the prevailing party shall be entitled to reasonable attorney's fees and costs, not to exceed one thousand seven hundred fifty dollars ($1,750).
5. Personal Property Storage: CA Business and Profession Code 7507.9
Personal effects shall be removed from the collateral, including any personal effect that is mounted but detachable from the collateral by a release mechanism. A complete and accurate inventory of the personal effects shall be made, and the personal effects shall be labeled and stored by the licensee for a minimum of 60 days in a secure manner, except those personal effects removed by or in the presence of the debtor or the party in possession of the collateral at the time of the repossession. If the licensee or the licensee's agent cannot determine whether the property attached to the collateral is a personal effect or a part of the collateral, then that fact shall be noted on the inventory and the licensee or agent shall not be obligated to remove the item from the collateral, unless the item can be removed without the use of tools, in which case it shall be removed and inventoried. The licensee or the licensee's agent shall notify the debtor that if the debtor takes the position that an item is a personal effect, then the debtor shall contact the legal owner to resolve the issue.
(a) The date and time the inventory is made shall be indicated. The permanent records of the licensee shall indicate the name of the employee or registrant who performed the inventory.
(b) The following items of personal effects are items determined to present a danger or health hazard when recovered by the licensee and shall be disposed of in the following manner:
(1)(A) Deadly weapons and dangerous drugs shall be turned over to any law enforcement agency for retention. These items shall be entered on the inventory and a notation shall be made as to the date, time, and place the deadly weapon or dangerous drug was turned over to the law enforcement agency, and a receipt from the law enforcement agency shall be maintained in the records of the repossession agency.
(B) Any other instrument or weapon, including, but not limited to, any instrument or weapon of the kind commonly known as a blackjack, slungshot, billy, sandclub, sandbag, metal knuckles, dirk, dagger, any knife having a blade longer than five inches, any razor with an unguarded blade, and any metal pipe or bar used or intended to be used as a club shall be inventoried and noted as “disposed of, dangerous device” and the item shall be disposed of in a reasonable and safe manner.
(2) Combustibles shall be inventoried and noted as “disposed of, dangerous combustible,” and the item shall be disposed of in a reasonable and safe manner.
(3) Food and other health hazard items shall be inventoried and noted as “disposed of, health hazard,” and disposed of in a reasonable and safe manner.
(c) Personal effects may be disposed of after being held for at least 60 days. The inventory, and adequate information as to how, when, and to whom the personal effects were disposed of, shall be filed in the permanent records of the licensee and retained for four years.
(d) The inventory shall include the name, address, business hours, and telephone number of the repossession agency to contact for recovering the personal effects and an itemization of all personal effects removal and storage charges that will be made by the repossession agency. The inventory shall also include the following statement: “Please be advised that the property listed on this inventory will be disposed of by the repossession agency after being held for 60 days from the date of this notice IF UNCLAIMED.”
(e) The inventory shall be provided to a debtor not later than 48 hours after the recovery of the collateral, except that if:
(1) The 48-hour period encompasses a Saturday, Sunday, or postal holiday, the inventory shall be provided no later than 72 hours after the recovery of the collateral.
(2) The 48-hour period encompasses a Saturday or Sunday and a postal holiday, the inventory shall be provided no later than 96 hours after the recovery of the collateral.
(3) Inventory resulting from repossession of a yacht, motor home, or travel trailer is such that it shall take at least 4 hours to inventory, then the inventory shall be provided no later than 96 hours after the recovery of the collateral. When the 96-hour period encompasses a Saturday, Sunday, or postal holiday, the inventory shall be provided no later than 120 hours after the recovery of the collateral.
(4) The licensee is unable to open a locked compartment that is part of the collateral, the available inventory shall be provided no later than 96 hours after the recovery of the collateral. When the 96-hour period encompasses a Saturday, Sunday, or postal holiday, the inventory shall be provided no later than 120 hours after the recovery of the collateral.
(f) Environmental, Olympic, special interest, or other license plates issued pursuant to Article 8 (commencing with Section 5000), Article 8.4 (commencing with Section 5060), or Article 8.5 (commencing with Section 5100) of Chapter 1 of Division 3 of the Vehicle Code that remain the personal effects of the debtor shall be removed from the collateral and inventoried pursuant to this section. If the plates are not claimed by the debtor within 60 days, they shall either (1) be effectively destroyed and the licensee shall, within 30 days thereafter, notify the Department of Motor Vehicles of their effective destruction on a form promulgated by the chief that has been approved as to form by the Director of the Department of Motor Vehicles; or (2) be retained by the licensee indefinitely to be returned to the debtor upon request, in which case the licensee shall not charge more than 60 days' storage on the plates.
(g) The notice may be given by regular mail addressed to the last known address of the debtor, or by personal service at the option of the repossession agency.
(h) With the consent of the licensee, the debtor waives the preparation and presentation of an inventory if the debtor redeems the personal effects or other personal property not covered by a security interest within the time period for the notices required by this section and signs a statement that the debtor has received all the property.
(i) If personal effects or other personal property not covered by a security agreement are to be released to someone other than the debtor, the repossession agency must receive written authorization to do so from the debtor.
(j) A licensee shall not sell personal effects or other personal property not covered by a security agreement and remit money from the sale to a third party, including, but not limited to, any lending institution.
(k) The inventory shall be a confidential document. A licensee shall only disclose the contents of the inventory under the following circumstances:
(1) In response to the order of a court having jurisdiction to issue the order.
(2) In compliance with a lawful subpoena issued by a court of competent jurisdiction.
(3) When the debtor has consented in writing to the release and the written consent is signed and dated by the debtor subsequent to the repossession and states the entity or entities to whom the contents of the inventory may be disclosed.
(4) To the debtor.
6. Transported Repossessed Vehicle Exempt from Registration: C.V.C 4022
IMPOUND FAQ
1. When must law enforcement agencies be open to issue impound releases?
A law enforcement agency must be open to issue impound releases whenever it is open to serve the public for regular, nonemergency business. [VC 14602.6(a)(2), 14602.7(a),14602.8(a)(3), 21100.4(a)(4)]
2. May local law enforcement collect an administrative fee from a legal owner or their agent to release impounded collateral?
No. Effective on January 1, 2000, the administrative fee may be collected only from the registered owner or agent of said registered owner. [VC 22850.5 (b)(2)]
3. Must a debtor pay a fee (normally $15) to a police department or sheriff’s department before redeeming the repossessed vehicle?
Yes, pursuant to Government Code Sections 26751 and 41612. This fee is not the obligation of the lienholder or repossessor.
4. Is a repossessed vehicle exempt from current registration?
A vehicle repossessed pursuant to the terms of a security agreement is exempt from the registration solely for the purpose of transporting the vehicle from the point of repossession to the storage facilities of the repossessor, and from the storage facilities to the legal owner or a licensed motor vehicle auction provided that the repossessor transports with the vehicle the appropriate documents authorizing the repossession and makes them available to a law enforcement officer on request. [VC 4022]
5. When a vehicle has been impounded by a public agency, who should notify the legal owner?
Within 48 hours of the storage, unless the vehicle is in a vehicle abatement program, or abandoned, the public agency is required to notify both legal and registered owner. [VC22852(a)]
6. Does the mandatory 30 day vehicle impoundment for driving with a suspended, revoked, or invalid license apply to the legal owner?
No. A legal owner or its agent (but not the registered owner) may obtain a release from the impounding authority prior to the 30 days if they meet three conditions:
1) They are a financial institution or they otherwise have a security interest in the vehicle;
2) They pay all towing and storage fees related to the seizure of the vehicle; and,
3) They provide certain foreclosure documents required by Vehicle Code Section 14602.6(f).
7. What documents shall a repossessor give to the Impounding Authority to get a release for a vehicle impounded under VC 14602.6?
The legal owner or the legal owner’s agent presents a copy of the assignment, as defined in subdivision (b) of Section 7500.1 of the Business and Professions Code, a release from the one responsible government agency, only if required by the agency, a government-issued photographic identification card, and any one of the following: a certificate of repossession for the vehicle, a security agreement for the vehicle, or title showing proof of legal ownership for the vehicle. Any documents presented may be originals, photocopies, or facsimile copies, or may be transmitted electronically. The law enforcement agency, impounding agency, or any person acting on behalf of those agencies shall not require any documents to be notarized.
8. What documents shall a repossessor give to the Impounding Authority to get a release for a vehicle impounded under VC 22651?
A vehicle shall be released to the legal owner, as defined in Section 370, if the legal owner does all of the following:
1. Pays the cost of towing and storing the vehicle.
2. Submits evidence of payment of registration fees as provided in Section 9561.
3. Completes an affidavit in a form acceptable to the impounding law enforcement agency stating that the vehicle was not in possession of the legal owner at the time of occurrence of the offenses relating to standing or parking.
Note: The legal owner or repossessor is not required to pay any outstanding parking tickets on the vehicle to obtain its release from impound. [VC 22651(i)(4)]
9. What can happen to a tow company if the legal owner is not notified?
Under Civil Code Section 3070, a legal owner has a right to accuse the tow company of “improperly causing a vehicle to be towed” if the tow company tries to collect storage over 15 days when Vehicle Code 10652.5 is violated. A notice must be sent to the legal owner by the 16th day of possession in order to collect more than 15 days of storage fees. [CC 3070(d1), (d2), (A)]
10. Must a person operating a storage facility accept credit cards for the release of impounded vehicles?
Yes. The storage facility must accept valid bank credit cards for towing and storage fees when registered or legal owners redeem their vehicles. [VC 14602.6(f)(2)(B), 14602.7(e)(2)(B), 14602.8(f)(2)(B), 21100.4(e)(2)(B), 22651.1, 22658(k)(1), 23118(e)(2)(B)]
11. Are there limits on the number of days storage can be charged by lien holders?
Yes. Civil Code 3068.1 limits public agency and private tows to a certain number of days chargeable for storage. A vehicle under $4000 in value shall not accrue storage charges beyond the 15th day unless lien sale proceedings have commenced. If the lien is filed by the 15th day of possession, the storage is limited to 60 days. This would include a required notice to be signed by the legal owner before the 16th day of possession. [VC 10652.5] A vehicle with a value over $4000, the lien sale shall commence by the 30th day of storage and allowing the storing party to collect for storage up to 120 days. If the lien sale commenced after 30 days–60 days of storage, then Vehicle Code 10652.5 applies and the storing party may only collect up to the 16th day of storage.
12. What is the maximum amount a repair garage may charge on a repair or storage to a legal owner?
On work or services performed, up to $1500 is allowed and the garage must have permission from the legal owner to exceed that amount. [CC 3068(c)] Storage is allowed up to $1025 for a vehicle under $4000 in value and $1250 if the vehicle is valued over $4000. [CC 3068(c)] There is also a requirement to notify the legal owner by the 16th day of possession if storage fees are charged and if legal owner is not notified, storage is limited to 15 days. [VC 10652.5 and CC 3071 & 3072]
13. Are there any reporting requirements when a vehicle is stored in a private building?
Yes. Every person other than the keeper of a garage renting any private building used as a private garage or space therein for the storage of a vehicle of a type subject to registration under the Vehicle Code, when the agreement to rent includes only the building or space therein, shall, within 24 hours after the vehicle is stored therein, report such fact together with the name of the tenant and a description of the vehicle, including the name or make, the VIN and the license number to the sheriff’s office of the county or the police department of the city wherein the building is located.“Private garage” as used in this section does not include a public warehouse or public garage. [VC 10654]
REPOSSESSION AGENCY QUESTIONS
1. What is a “repossession agency” as defined by the State of California?
A repossession agency means and includes any person who, for any consideration whatsoever, engages in the repossession business or accepts employment to locate or recover personal property, including but not limited to, personal property registered under provisions of the Vehicle Code which is subject to a security agreement. [B&P 7500.2]
2. What is not a “repossession agency” as defined by the State of California?
The following are exempt from the definition of a “repossession agency”:
1. Banks.
2. Licensed lending institutions.
3. Attorneys performing legal duties.
4. Legal owners of collateral which is subject to a security agreement.
5. Federal, state or municipal officers or employees performing official duties.
6. A bona fide employee employed exclusively and regularly by the legal owner of the collateral.
7. Qualified certificate holders and registrants when performing services for a licensee. [B&P 7500.3]
3. How may it be determined whether or not a person or agency holds a valid repossessor’s license?
This informational directory includes a numerical and alphabetical listing of repossession agencies who are licensed by the State of California and current CALR members as of PENDING, 2009. Any person may contact the Bureau of Security and Investigative Services at 2420 Del Paso Blvd, Suite 270, Sacramento, CA 95834, (916) 322-4000 to determine whether or not a particular person or agency is licensed. Or visit the Bureau’s website at www.dca.ca.gov/bsis.
4. Should a legal owner have a copy of the repossessor’s state issued license number on file prior to assigning an account to them?
Although it is not required by law, it would provide a positive defense to any allegation of having assigned an account to a nonexempt unlicensed person in violation of B&P Code Section 7502.2 which is punishable by a fine of $5,000.
5. May a financial institution be penalized for using an unlicensed repossession agency or person?
Yes! Any person who knowingly engages an unlicensed repossession agency or person to repossess personal property is guilty of a misdemeanor which is punishable by a fine of $5,000 or by imprisonment in the county jail for not more than one year, or both.[B&P 7502.2a]
6. May unlicensed repossession activity be penalized?
Yes! Any person who violates any provision of the Collateral Recovery Act or whoconspires to violate any provision or who engages in repossession activity (other than a licensed repossessor), is guilty of a misdemeanor which is punishable by a fine of $5,000 or by imprisonment in the county jail for not more than one year, or both. In addition, the unlicensed agency’s tow truck may be impounded. [B&P 7502.1(a)]
7. May a licensed repossessor accept an assignment to repossess from a registered owner?
Yes. Assignment also means an authorization by the registered owner to recover collateral registered under the Vehicle Code where an employer/employee relationship exists or existed between the registered owner and the possessor of the property and the possessor is wrongfully in possession of the property. [B&P 7500.1(b)]
FIELD REPOSSESSION QUESTIONS
1. Who may legally undertake repossession assignments?
Unless exempted pursuant to B&P Code 7500.3, only persons holding a valid repossession agency license or registration, issued by the State of California, may engage in the activities of a repossession agency. [B&P 7500.3]
2. When may a vehicle secured by a contractual agreement be repossessed?
Normally, only when the buyer has defaulted in the performance of any obligation under the contract. Ordinarily a default occurs when an installment payment is delinquent. However, if the consumer is required by the contract to maintain insurance, a failure to do so may constitute a default, as allowing the collateral to be jeopardized. [CC 2983.3]
3. May a tow service, auto drive away service or a transport company not specifically licensed as a “repossession agency” repossess collateral VOLUNTARILY or INVOLUNTARILY?
No! These businesses are not exempt under B&P Code 7500.3 and would therefore be in violation relating to unlicensed activity. Violators are subject to fines of $5,000 and/or one year in the county jail. [B&P 7502.1a]
4. Is police notification required prior to an attempted repossession?
No. Some jurisdictions, however, request a courtesy call prior to a repossession to eliminate the possibility of a repossessor being stopped at gunpoint in the event someone reports a stolen vehicle or a prowler.
5. Is it a crime to conceal a motor vehicle or other collateral?
Yes. Any person in possession of collateral who conceals property with the intent to defraud a creditor may be guilty of a felony. [PC 154, 504a or 538]
6. At what point has a motor vehicle been legally repossessed?
With regard to collateral subject to registration under the Vehicle Code, a repossession is complete when the repossessor gains entry to the collateral, or when the collateral becomes connected to a tow truck or the repossessor’s tow vehicle. Once the repossession is complete, no person other than the legal owner may direct a repossessor to release a vehicle without legal authority to do so even if the vehicle is still on private property. [B&P 7507.12]
7. May a repossessor lawfully enter an area for purposes of repossession?
In most cases, yes. However, a repossessor may not enter a fenced and locked area ora private building such as an enclosed structure without the consent of the owner or person in legal possession of the property. [B&P 7500.1(r), 7508.2(g)]
8. May a law enforcement officer force a repossessor to give up possession of collateral?
Peace officers may not advance or hinder repossessions. Because they are acting under“color of state law,” they may no more force a debtor to surrender a car than they may, after a car has been repossessed, force the repossessor to return it. Without a court order, both things violate the “due process” requirements of the 14th Amendment of the United States Constitution and Article 1, Sections 13 and 15 of the California Constitution. No person other than the legal owner may direct a repossessor to release a vehicle without legal authority to do so. [B&P 7507.12]
9. Can the repossessor take personal effects that are attached to the repossessed collateral?
Yes. Nothing in the Collateral Recovery Act prohibits the using or taking of personal effects that are connected, adjoined, or affixed to the collateral through an unbroken sequence, if that use or taking is reasonably necessary to effectuate the recovery in a safe manner or to protect the collateral or personal effects. (B &P 7505.2)
10. May a law enforcement officer force a repossessor to give back personal effects at the time of repossession?
No. Personal effects shall be removed and inventoried. (B&P 7507.9)
11. Should a repossessor have a police officer accompany him/her on a repossession?
Self-help repossession provisions of UCC 9-609 do not violate the 14th Amendment if it is the conduct of a private individual dealing with a private individual. However, the presence of a police officer or a patrol car accompanying a repossessor has been found by several courts to constitute “color of law” and has taken the repossession out of the area of “purely private conduct without state assistance.” Do not take a sheriff or police officer out on a self-help repossession.
12. Is possession by a registered repossessor of tools described as “burglary tools” and of vehicle or wheel lock master keys as defined in Sections 466 and 466.5 of the California Penal Code prohibited by law?
No. Those sections specify that possession with the “intent feloniously to break or enter any building or vehicle” is a misdemeanor, and that possession of vehicle master keys with the intent to use them “in the commission of an unlawful act” is a misdemeanor. Tools used by repossessors are “tools of the trade” and are legally possessed without any intent to commit a crime.
POST REPOSSESSION QUESTIONS
1. How far can a repossessor tow a repossessed vehicle on a public highway with only one safety chair attached?
One mile. VC 29004(f)
2. Do tow lights have to be connected with an extension cord?
No. Tow lights may be cordless. [VC 24605]
3. Is a police report required on all repossessions?
Yes. Whenever possession is taken of any vehicle by or on behalf of any legal ownerthereof under the terms of a security agreement or lease agreement, the person taking possession shall (a) notify, within one hour after taking possession of the vehicle, and by the most expeditious means available, the city police department where the taking of possession occurred, if within an incorporated city, or the sheriff’s department of the county where the taking of the possession occurred, if outside an incorporated city, or the police department of a campus of the University of California or the California State University, if the taking of possession occurred on that campus, and shall within one business day forward a written notice to the city police or the sheriff’s department.
Any person failing to notify the city police department, sheriff’s department or campus police department as required by this section is guilty of an infraction, and shall be fined a minimum of $300 and up to $500. The district attorney, city attorney, or city prosecutor shall promptly notify the Bureau of Security and Investigative Services of any conviction resulting from a violation of this section. [VC 28]
4. Must licensees make condition reports of repossessions?
Yes. Repossession agencies are required to keep and maintain adequate records of all transactions including condition reports reflecting the condition of a vehicle at the time of repossession and its odometer reading. [B&P 7507.3]
5. What is to be done with personal effects?
Personal effects shall be removed and a complete and accurate inventory shall be made. Said items shall be securely stored for a minimum of 60 days except those personal effects removed by or in the presence of the debtor or the party in possession of the collateral at the time of the repossession. It is required that the repossession agency notify the consumer of this inventory by written notice or by personal service within time limits prescribed by law. [B&P 7507.9]
6. What is to be done with deadly weapons contained in or on collateral at time of repossession?
Deadly weapons and dangerous drugs shall be turned over to a local law enforcement agency for retention. These items shall be entered on the inventory and a notation shall be made as to the date, time and place the deadly weapon or dangerous drug was turned over to the law enforcement agency. A receipt from the law enforcement agency shall be maintained in the records of the repossession agency. [B&P 7507.9(b)(1)]
7. What is to be done with combustibles after being removed from repossessed collateral?
Combustibles shall be inventoried and noted as “disposed of, dangerous combustible” and disposed of in a reasonable and safe manner. [B&P 7507.9(b)(2)]
8. May a repossession agency charge a fee for storing personal effects? (Referring to inventory of effects from a repossession.)
Yes. A licensee may charge the debtor for storing personal effects since B&P Code 7507.9 and 9(d) states in part, “The inventory shall include . . . an itemization of all personal effects removal and storage charges that will be made by the repossession agency.” A licensee may not charge a legal owner for storage of personal effects unless specifically agreed to at the time of the assignment or at a subsequent time.
REPOSSESSORS TOW VEHICLE QUESTIONS
1. Must a repossessor’s tow truck be equipped with signs on the door of the truck indicating the repossession agency’s name, address and phone number?
No. A person licensed as a repossession agency pursuant to the B&P Code (commencing with Section 7500), or a registered employee of the agency, may use the State issued repossession license number in lieu of a sign containing a name, business address, and telephone number. [VC 27907]
2. Must a repossessor’s tow vehicle comply with the usual height requirement for the placement of its rear license plate?
No. The rear license plate on a tow truck or repossessor’s tow vehicle may be mounted on the left-hand side of the mast assembly at the rear of the cab of the vehicle, not less than 12 inches nor more than 90 inches from the ground.
