55-3-126 - Constructive notice of lien upon filing request for notation Method of giving notice Perfection of security interest.
55-3-126. Constructive notice of lien upon filing request for notation Method of giving notice Perfection of security interest.
(a) Except as provided for manufactured homes complying with the requirements of § 55-3-138, a lien or security interest in a vehicle of the type for which a certificate is required shall be perfected and shall be valid against subsequent creditors of the owner, subsequent transferees, and the holders of security interest and liens on the vehicle by compliance with this chapter.
(b) (1) A security interest or lien is perfected by delivery to the department or the county clerk of the existing certificate of title, if any, title extension form, or manufacturer's statement of origin and an application for a certificate of title containing the name and address of the holder of a security interest or lien with vehicle description and the required fee.
(2) The security interest is perfected as of the date of delivery to the county clerk or the department.
(3) (A) Notwithstanding any other law to the contrary, a second or other junior security interest or lien in a vehicle of the type for which a certificate of title is required shall not be considered perfected unless and until the lien or security interest is physically noted on the certificate of title for the vehicle. In the case of a second or other junior lien or security interest, there shall be no constructive notice of the second or other junior lien or security interest unless that lien is physically noted on the certificate of title.
(B) Nothing in subdivision (b)(3)(A) shall have any effect on perfection and constructive notice concerning first liens.
(c) When the security interest is perfected as provided for in this section, it shall constitute notice of all liens and encumbrances against the vehicle described in the security interest to creditors of the owner, to subsequent purchasers and encumbrances, except liens as may be authorized by law dependent upon possession. Constructive notice shall date from the time of first delivery of the request for the notation of the lien or encumbrance upon the certificate of title by either the department or the county clerk acting as agent for the department, as shown by its endorsements of the date of delivery on the document.
(d) The method provided in this section and § 55-3-125 of obtaining a lien or encumbrance upon a motor vehicle, mobile home, house trailer or other mobile structure, whether or not taxed as real property, subject to the provisions of chapters 1, 2, this chapter and chapters 4-6 of this title relative to the issuance of certificates of title, shall be exclusive except as to liens depending upon possession and the lien of the state for taxes established pursuant to title 67, chapter 1, part 14; provided, that §§ 66-24-101, 66-26-101, 66-26-105 and 66-26-110, or any other sections, shall not be construed to require the deposit, filing or other record whatsoever of a chattel mortgage, deed of trust conveyance intended to operate as a mortgage, trust receipt, or other similar instrument. It is the intent of this section that any mortgage, trust receipt or other similar instrument of indebtedness required by chapters 1, 2, this chapter and chapters 4-6 of this title shall be perfected by delivery and then noted upon the certificate of title only, and shall not be required to be made a public record elsewhere, except as expressly provided otherwise in § 47-9-311(d).
(e) With respect to implements of husbandry and special mobile equipment, the perfection of a security interest under chapters 1, 2, this chapter and chapters 4-6 of this title is not effective until the lienholder has complied with the provisions of applicable law that otherwise relate to the perfection of security interest in personal property, and any person who receives transfer of an interest in this equipment without knowledge of the certificate is not prejudiced by reason of its existence.
(f) (1) When a manufacturer's statement of origin or an existing certificate of title on a motor vehicle is unavailable, a first lienholder or the first lienholder's designee may file a notarized copy of an instrument creating and evidencing a lien or encumbrance on the motor vehicle with the secretary of state and shall remit therewith a fee of ten dollars ($10.00) for each lien to be filed. The recording and filing shall constitute constructive notice of the lien against the motor vehicle as described to creditors of the owner, subsequent purchasers and encumbrancers, except liens as are by law dependent upon possession.
(2) The constructive notice shall be effective from the time of the filing of the instrument creating and evidencing the lien or encumbrance as authorized in this subsection (f); provided, that the filing of a lien under this section by the lienholder and the payment of the fee shall in no way relieve any person of the obligation of paying the fee now required by law for filing a lien to be evidenced on a certificate of title of a motor vehicle.
(3) A lien filed under this subsection (f) shall automatically terminate after one hundred eighty (180) days or upon being perfected under other provisions of this section, whichever occurs first.
(4) Whenever a lienholder or the lienholder's designee files a lien under this subsection (f) and later under other provisions of this subsection (f), the lien shall be presumed to be perfected at the time of the earliest filing.
(5) The secretary of state may require as a condition of filing that any document submitted for filing as a lien under this subsection (f) include a cover form, prescribed by the secretary of state, that identifies the name and address of each debtor, the name and address of the lienholder, the vehicle identification number of the motor vehicle, the date the document was executed, and the person and address to whom the acknowledgement of filing should be sent. The cover form shall be considered part of the instrument creating and evidencing a lien or encumbrance on the motor vehicle described on that form.
(6) Upon request of any person, the secretary of state may issue a certificate showing whether there is on file, on the date stated therein, any presently effective liens naming a particular debtor, giving the date and hour of filing of each effective lien, and the vehicle identification number and the name of the lienholder. The fee for this certificate shall be ten dollars ($10.00). Upon request, the secretary of state shall furnish a copy of any filed lien for a uniform fee of one dollar ($1.00) per page.
(7) The secretary of state has the power reasonably necessary to perform the duties required of the secretary of state by this subsection (f), including, without limitation, the power to promulgate necessary and appropriate rules and regulations consistent with this subsection (f), and the power to destroy any documents filed under this subsection (f) two hundred seventy (270) days after the filing of the documents.
(8) Notwithstanding any law to the contrary, the fees collected by the secretary of state under this subsection (f) shall be retained by the secretary of state to offset costs associated with the administration and continued improvement of the secretary of state's recordkeeping functions.
(g) The provisions of subsection (f) added by Acts 1998, ch. 1016 shall be reviewed by the house and senate government operations committees by February 1, 2001. The government operations committees of the senate and house of representatives shall prepare a written report, and shall cause to be introduced any necessary legislation to implement the recommendations contained in such report. The government operations committees shall prepare a written report and any necessary legislation pursuant to the report every three (3) years beginning February 1, 2001, with the report to be delivered to the speaker of the house of representatives, the speaker of the senate, the governor, and the secretary of state.
[Acts 1951, ch. 70, § 69 (Williams, § 5538.169); Acts 1968, ch. 403, § 1; 1971, ch. 382, § 1; 1978, ch. 686, § 4; T.C.A. (orig. ed.), § 59-327; Acts 1984, ch. 559, § 2; T.C.A., § 55-3-137; Acts 1996, ch. 687, § 1; 1997, ch. 279, § 1; 1997, ch. 523, § 1; 1998, ch. 1016, §§ 1-3; 2000, ch. 846, § 36; 2003, ch. 76, § 4; 2007, ch. 484, § 26.]