Transfer by Operation of Law

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  1. Upon any transfer of title or interest of an owner in or to a registered vehicle to another otherwise than by voluntary transfer, the new owner may secure a new registration and certificate of title upon the payment of all proper fees by any one (1) of the following methods:
    1. By proper application and upon presentation of either the last certificate of title, or a bill of sale properly endorsed by the former owner and duly assigned to the new owner, as provided in §§ 55-3-118 and 55-4-101;
    2. Where the motor vehicle has been advertised and sold under any conditional sales contract, or other lien which shall be noted on the then outstanding certificate of title without the necessity of judicial proceedings, a new certificate of title and registration may be obtained by the new owner upon an application therefor regularly filed, accompanied by an affidavit made by the lienor, stating that the motor vehicle has been repossessed and sold under and by virtue of the terms of the lien and the law applicable thereto, together with the outstanding certificate of title, if available, and any other additional information as may be reasonably required by the commissioner;
    3. Where the motor vehicle has been sold under and by virtue of an order of any court, or by virtue of an execution duly issued by any court or its clerk, the new owner will be entitled to a certificate of title and registration thereof upon an application therefor, being duly filed together with a certified copy of the court order or execution, showing the return thereon, an affidavit of the person who shall actually sell the motor vehicle by virtue of the court order or execution that the sale has been conducted in a legal and proper manner and in accordance with the terms of the lien contract, and if sold under a lien, noted on the certificate of title, together with the certificate of title, if available, and such other information as may be reasonably required by the commissioner; or
    4. By any other means as may be provided for by the reasonable rules and regulations of the commissioner.
  2. No title transferred by virtue of any of the means set out in subsection (a) shall pass better or greater title to the purchaser than could have been conveyed and assigned by the certificated title holder when joined in the transfer or assignment by the lienor at whose instance the motor vehicle is being sold, if being sold for the satisfaction of a lien noted on the certificate of title, to an innocent purchaser for value.
  3. Where the holder or owner of a conditional sales contract has possession of the then outstanding certificate of title and becomes the purchaser of the motor vehicle at such sale and holds the vehicle for resale and operates the same under special plates as may be issued under § 55-4-226, to dealers for purposes of demonstrating or selling the vehicle, the purchaser at the sale shall not be required to obtain a new registration of the vehicle or be required to obtain a new certificate of title, but upon transferring interest or title to another person shall execute an affidavit stating that the motor vehicle has been repossessed and sold under and by virtue of the terms of the conditional sales contract and the law applicable to the conditional sales contract and that this person became the purchaser of the motor vehicle, and the affidavit and the then outstanding certificate of title shall be delivered to the person as the new owner, and the new owner may secure a new registration and certificate of title.
  4. Where no certificate of title has been issued by the state or by any other state in connection with any such motor vehicle as may be sold or otherwise disposed of as provided in subdivision (a)(2), and where the lienor is a financial institution authorized to do business in the state and subject to supervision by the commissioner of commerce and insurance, the commissioner of financial institutions, or the comptroller of the currency of the United States, then the commissioner shall accept, in lieu of a certificate of title and in lieu of the affidavit specified in subdivision (a)(2), the following:
    1. An affidavit made by the lienor setting forth:
      1. The name and last known address of the former owner;
      2. That no certificate of title has been issued in connection with the motor vehicle, to the best of lienor's information and belief;
      3. That the lien instrument held by lienor evidences a valid and enforceable lien in the lienor's favor;
      4. That the motor vehicle was repossessed and sold under and by virtue of the terms of the lien and the law applicable thereto;
      5. The balance owing which is secured by the lien; and
      6. The exhibit of a true copy of the lien instrument, together with any assignment thereof if applicable; and
    2. A bond executed by the lienor, without sureties, in a penal sum equal to the value of the motor vehicle, payable to the state of Tennessee, and conditioned to hold the state harmless from any liability or damages which might arise in connection with the issuance of a new registration and certificate of title. For purposes of this subdivision (d)(2), it shall be presumed, in the absence of a contrary showing, that the value of the motor vehicle is equal to the balance owing which is secured by the lien instrument. Where the affidavit and bond specified in this subdivision (d)(2) are filed by a lienor, that lienor shall pay to the department, in addition to all other fees which may be required, a fee of five dollars ($5.00).


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