Tex. Parks and Wildlife Code § 31.0569 — TX Code / Code pw / Chapter 31 / Section 31.0569
§ 31.0569. PERFECTION OF SECURITY INTEREST.
Status: in_force

(a) A security interest in a vessel or outboard motor may be perfected only by delivery to the department of an application for a certificate of title that identifies the secured party and otherwise complies with Section 31.049. The security interest is perfected on the later of delivery to the department of the application and the applicable fee or attachment of the security interest under Section 9.203, Business & Commerce Code.

(b) If the interest of a person named as owner, lessor, consignor, or bailor in an application for a certificate of title delivered to the department is a security interest, the application sufficiently identifies the person as a secured party. Identification on the application for a certificate of title of a person as owner, lessor, consignor, or bailor is not by itself a factor in determining whether the person's interest is a security interest.

(c) If the department has issued a certificate of title for a vessel or outboard motor, a security interest in the vessel or outboard motor may be perfected by delivery to the department of an application, on a form prescribed by the department, to have the security interest added to the certificate of title. The application must be signed by an owner of the vessel or outboard motor or by the secured party and must include:

(1) the name of the owner of record;

(2) the name and mailing address of the secured party;

(3) the hull identification number of the vessel and serial number of the outboard motor, as applicable; and

(4) the certificate of title, if the department has issued a written certificate of title for the vessel or outboard motor.

(d) A security interest perfected under Subsection (c) is perfected on the later of:

(1) delivery to the department of the application and all applicable fees; or

(2) attachment of the security interest under Section 9.203, Business & Commerce Code.

(e) On delivery of an application that complies with Subsection (c) and payment of all applicable fees, the department shall issue a new certificate of title under Section 31.0485 and deliver the new certificate of title or a record evidencing an electronic certificate of title as required by Subsection (e) of that section. The department shall maintain in the files of the department the date and time of delivery of the application to the department.

(f) If a secured party assigns a perfected security interest in a vessel or outboard motor, the receipt by the department of a statement providing the name of the assignee as secured party is not required to continue the perfected status of the security interest against creditors of and transferees from the original debtor. A purchaser of a vessel or outboard motor subject to a security interest who obtains a release from the secured party indicated in the files of the department or on the certificate of title takes free of the security interest and of the rights of a transferee unless the transfer is indicated in the files of the department or on the certificate of title.

(g) This section does not apply to a security interest:

(1) issued for a vessel or outboard motor by a person during any period in which the vessel or outboard motor is inventory held for sale or lease by the person or is leased by the person as lessor if the person is in the business of selling vessels or outboard motors;

(2) in a barge for which no application for a certificate of title has been delivered to the department; or

(3) in a vessel or outboard motor before delivery if the vessel or outboard motor is under construction or completed under contract and for which no application for a certificate of title has been delivered to the department.

(h) If a certificate of documentation for a documented vessel is deleted or canceled, a security interest in the vessel that was valid immediately before deletion or cancellation against a third party as a result of compliance with 46 U.S.C. Section 31321 is and remains perfected until the earlier of:

(1) four months after deletion or cancellation of the certificate of documentation; or

(2) the perfection of the security interest under this section.

(i) A security interest in a vessel or outboard motor arising under Section 2.401, 2.505, 2.711(c), or 2A.508(e), Business & Commerce Code, is perfected when it attaches but becomes unperfected when the debtor obtains possession of the vessel or outboard motor, unless before the debtor obtains possession the security interest is perfected under Subsection (a) or (c).

(j) A security interest in a vessel or outboard motor as proceeds of other collateral is perfected to the extent provided in Section 9.315, Business & Commerce Code.

(k) A security interest in a vessel or outboard motor perfected under the law of another jurisdiction is perfected to the extent provided in Section 9.316(d), Business & Commerce Code.