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186A.190 Security interest notation required on title document -- Determination of debtor's residence when debtor is other than a natural person -- Discharge of security interest -- Issuance of ne

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Page 1 of 4 186A.190 Security interest notation required on title document -- Determination of debtor's residence when debtor is other than a natural person -- Discharge of <br>security interest -- Issuance of new title to creditor in possession upon certain <br>conditions -- Fees. (1) Except as provided in subsection (4) of this section and in KRS 355.9-311(4), the perfection and discharge of a security interest in any property for which has been <br>issued a Kentucky certificate of title shall be by notation on the certificate of title. <br>The notation of the security interest on the certificate of title shall be in accordance <br>with this chapter and shall remain effective from the date on which the security <br>interest is noted on the certificate of title for a period of seven (7) years, or, in the <br>case of a manufactured home, for a period of thirty (30) years, or until discharged <br>under this chapter and KRS Chapter 186. The filing of a continuation statement <br>within the six (6) months preceding the expiration of the initial period of a <br>notation's effectiveness extends the expiration date for seven (7) additional years. (2) Except as provided in subsection (4) of this section, the notation of security interests relating to property required to be titled in Kentucky through the county clerk shall <br>be done in the office of the county clerk of the county in which the debtor resides. If <br>the debtor is other than a natural person, the following provisions govern the <br>determination of the county of the debtor's residence: <br>(a) A partnership shall be deemed a resident of the county in which its principal place of business in this state is located. If the debtor does not have a place of <br>business in this state, then the debtor shall be deemed a nonresident for <br>purposes of filing in this state; (b) A limited partnership organized under KRS Chapter 362 or as defined in KRS 362.2-102(14) shall be deemed a resident of the county in which its principal <br>place of business is located, as set forth in its certificate of limited partnership <br>or most recent amendment thereto filed pursuant to KRS Chapter 362 or <br>362.2-202. If such office is not located in this state, the debtor shall be <br>deemed a nonresident for purposes of filing in this state; (c) A limited partnership not organized under the laws of this state and authorized to do business in this state shall be deemed a resident of the county in which <br>the office of its process agent is located, as set forth in the designation or most <br>recent amendment thereto filed with the Secretary of State of the <br>Commonwealth of Kentucky; (d) A corporation organized under KRS Chapter 271B, 273, or 274 or a limited liability company organized under KRS Chapter 275 shall be deemed a <br>resident of the county in which its registered office is located, as set forth in <br>its most recent corporate filing with the Secretary of State which officially <br>designates its current registered office; (e) A corporation not organized under the laws of this state, but authorized to transact or do business in this state under KRS Chapter 271B, 273, or 274, or <br>a limited liability company not organized under the laws of this state, but <br>authorized to transact business in this state under KRS Chapter 275, shall be <br>deemed a resident of the county in which its registered office is located, as set Page 2 of 4 forth in its most recent filing with the Secretary of State which officially <br>designates its current registered office; (f) A cooperative corporation or association organized under KRS Chapter 272 shall be deemed a resident of the county in which its principal business is <br>transacted, as set forth in its articles of incorporation or most recent <br>amendment thereto filed with the Secretary of State of the Commonwealth of <br>Kentucky; (g) A cooperative corporation organized under KRS Chapter 279 shall be deemed a resident of the county in which its principal office is located, as set forth in <br>its articles of incorporation or most recent amendment thereto filed with the <br>Secretary of State of the Commonwealth of Kentucky; (h) A business trust organized under KRS Chapter 386 shall be deemed a resident of the county in which its principal place of business is located, as evidenced <br>by the recordation of its declaration of trust in that county pursuant to KRS <br>Chapter 386; (i) A credit union organized under Subtitle 6 of KRS Chapter 286 shall be deemed a resident of the county in which its principal place of business is <br>located, as set forth in its articles of incorporation or most recent amendment <br>thereto filed with the Secretary of State of the Commonwealth of Kentucky; <br>and (j) Any other organization (defined in KRS 355.1-201) shall be deemed a resident of the county in which its principal place of business in this state is <br>located, except that any limited liability company, limited liability partnership, <br>limited partnership, or corporation not organized under the laws of this state <br>and not authorized to transact or do business in this state shall be deemed a <br>nonresident for purposes of filing in this state. If the organization does not <br>have a place of business in this state, then it shall be deemed a nonresident for <br>purposes of filing in this state. If the debtor does not reside in the Commonwealth, the notation of the security <br>interest shall be done in the office of the county clerk in which the property is <br>principally situated or operated. Notwithstanding the existence of any filed <br>financing statement under the provisions of KRS Chapter 355 relating to any <br>property registered or titled in Kentucky, the sole means of perfecting and <br>discharging a security interest in property for which a certificate of title is required <br>by this chapter is by notation on the property's certificate of title under the <br>provisions of this chapter or in accordance with the provisions of KRS 186.045(3). <br>In other respects the security interest is governed by the provisions of KRS Chapter <br>355. (3) Except as provided in subsection (4) of this section, before ownership of property subject to a lien evidenced by notation on the certificate of title may be transferred, <br>the transferor shall obtain the release of the prior liens in his name against the <br>property being transferred. Once a security interest has been noted on the owner's <br>title, a subsequent title shall not be issued by any county clerk free of the notation <br>unless the owner's title is presented to the clerk and it has been noted thereon that Page 3 of 4 the security interest has been discharged. If this requirement is met, information <br>relating to any security interest shown on the title as having been discharged may be <br>omitted from the title to be issued by the clerk. If information relating to the <br>discharge of a security interest is presented to a clerk under the provisions of KRS <br>186.045(3), the clerk shall discharge the security interest and remove the lien <br>information from AVIS. (4) Notwithstanding subsections (1), (2), and (3) of this section, a county clerk shall, following inspection of the vehicle by the sheriff, to determine that the vehicle has <br>not been stolen, issue a new title to a vehicle, clear of all prior liens, to a person <br>after he provides to the county clerk an affidavit devised by the Transportation <br>Cabinet and completed by the person. In the affidavit, the person shall attest that: <br>(a) He possesses the vehicle; <br>(b) A debt on the vehicle was owed him for more than thirty (30) days before he provided the notices required by paragraphs (c) and (d) of this subsection; (c) More than fourteen (14) days before presenting the affidavit to the county clerk, the person attempted to notify the owner of the vehicle and all known <br>lienholders, including those noted on the title, by certified mail, return receipt <br>requested, of his name, address, and telephone number as well as his intention <br>to obtain a new title, clear of all prior liens, unless the owner or a lienholder <br>objected in writing; (d) More than fourteen (14) days before presenting the affidavit to the county clerk, the person had published a legal notice stating his intention to obtain <br>title to the vehicle. The legal notice appeared at least twice in a seven (7) day <br>period in a newspaper published, and with a statewide circulation, in <br>Kentucky. The legal notice stated: <br>1. The person's name, address, and telephone number; 2. The owner's name; 3. The names of all known lienholders, including those noted on the title; 4. The vehicle's make, model, and year; and 5. The person's intention to obtain title to the vehicle unless the owner or a <br>lienholder objects in writing within fourteen (14) days after the last <br>publication of the legal notice; and (e) Neither the owner nor a lienholder has objected in writing to the person's right to obtain title to the vehicle. (5) No more than two (2) active security interests may be noted upon a certificate of title. (6) In noting a security interest upon a certificate of title, the county clerk shall ensure that the certificate of title bears the lienholder's name, mailing address and zip code, <br>the date the lien was noted, the notation number, and the county in which the <br>security interest was noted. The clerk shall obtain the information required by this <br>subsection for notation upon the certificate of title from the title lien statement <br>described in KRS 186A.195 to be provided to the county clerk by the secured party. Page 4 of 4 (7) For all the costs incurred in the notation and discharge of a security interest on the certificate of title, the county clerk shall receive the fee prescribed by KRS 64.012. <br>The fee prescribed by this subsection shall be paid at the time of submittal of the <br>title lien statement described in KRS 186A.195. (8) A copy of the application, certified by the county clerk, indicating the lien will be noted on the certificate of title shall be forwarded to the lienholder. Effective: July 12, 2006 <br>History: Amended 2006 Ky. Acts ch. 149, sec. 225, effective July 12, 2006; and ch. 242, sec. 63, effective July 12, 2006. -- Amended 2003 Ky. Acts ch. 103, sec. 2, <br>effective June 24, 2003. -- Amended 2001 Ky. Acts ch. 65, sec. 1, effective July 1, <br>2001. -- Amended 2000 Ky. Acts ch. 408, sec. 179, effective July 1, 2001. -- <br>Amended 1996 Ky. Acts ch. 297, sec. 1, effective July 15, 1996. -- Amended 1990 <br>Ky. Acts ch. 478, sec. 4, effective July 13, 1990. -- Amended 1988 Ky. Acts ch. 132, <br>sec. 2, effective March 31, 1988. -- Amended 1986 Ky. Acts ch. 118, sec. 97, <br>effective July 1, 1987. -- Created 1982 Ky. Acts ch. 164, sec. 35, effective July 15, <br>1982. Legislative Research Commission Note (7/12/2006). This section was amended by 2006 Ky. Acts chs. 149 and 242, which do not appear to be in conflict and have been <br>codified together. Legislative Research Commission Note (7/12/2006). 2006 Ky. Acts ch. 247 instructs the Reviser of Statutes to adjust KRS references throughout the statutes to conform <br>with the 2006 renumbering of the Financial Services Code, KRS Chapter 286. Such <br>an adjustment has been made in this statute.