RS 711 - Sale subject to mortgage or security interest; act of sale and assignment of certificate; corrected certificate
A. In the event the certificate of title is held by a lien holder and sale is contemplated subject to the existing chattel mortgage or security interest and it is impractical for the owner to produce and deliver the certificate of title at the time possession is delivered to the purchaser, then the owner shall make and deliver to the purchaser at the time of delivery of the vehicle an act of sale of such vehicle and assignment of the certificate of title, subject to all existing chattel mortgages and security interests, on a form to be prescribed and furnished by the commissioner. The purchaser shall within five days of the transaction forward the act of sale and assignment to the commissioner accompanied by the fee prescribed by this Chapter and also accompanied by an application for a certificate of title as hereafter set forth.
B. Upon receipt of the act of sale and assignment and the application, the commissioner shall notify all lien holders in writing of the sale and request the holder of the certificate of title to surrender it, and shall issue in lieu thereof a corrected certificate of title in the name of the new owner and deliver it to the first ranking mortgage holder or owner. The corrected certificate of title shall show on its face all existing chattel mortgages or security interests. It shall be the duty of any holder of a certificate of title, on request of the commissioner, to return same, within five days, in order that correction might be made thereon; provided however, the provisions of this Section shall not be construed as impairing any rights which a mortgage or lien holder may have by virtue of a chattel which existed prior to December 15, 1950.
Acts 1950, No. 342, §14. Amended by Acts 1952, No. 121, §1; Acts 1989, No. 137, §11, eff. Sept. 1, 1989.