Court Opinion

ID: 7826405
Source: CourtListenerOpinion
Date Created: 2022-09-07 18:07:58.599269+00
Date Added: 2024-06-11T16:30:52.567353
License: Public Domain

Tom Glaze, Justice, dissenting. Section 18-45-202(b) (1987) provides that the lien of a dealer/vendor, retaining title for an automobile, is superior to a repairmen’s lien. Act 737 of 1991 was later enacted prohibiting a vendor or dealer selling cars from using title-retention notes. The question arises in this case whether, by its passage of Act 737, the General Assembly intended to affect a dealer’s or vendor’s Hen rights established in § 18-45-202. The answer is no. In paragraph (d) of Act 737, the General Assembly provided the following: This section [Act] is not intended to limit the rights of a lienholder to perfect or record his security interest in a motor vehicle pursuant to the provisions of Ark. Code Ann. §§ 27-14-802 and - 803. (Emphasis added.) Section 27-14-801 provides that no conditional sale contract or lien is valid against an owner’s (purchaser’s) creditors acquiring a hen until other subchapter requirements are met. Subchapter § 27-14-802(a), in pertinent part, provides that a dealer/vendor must deposit with the State Motor Vehicle Office a copy of the instrument creating and evidencing a lien with the last certificate of title issued for the vehicle. The Office then endorses the date and hour when the instruments are filed and issues a new certificate of tide with the name of the new owner and statement of all liens. Section 27-14-806 then provides a vendor lienholder two options in recording his lien — the hen may be recorded on the manufacturer’s statement of origin or on an existing certificate of title. Here, Bokker Used Cars complied fully with the foregoing provisions when perfecting its hen. On May 18, 1994, OdeU Hill purchased a Toyota by signing a retail installment contract giving a security interest to Bokker Used Cars. Upon Bokker filing the necessary documents with the State, Hill received his new certificate of tide dated July 5, 1994, showing him as owner and Bokker’s Used Cars as first henholder. See attached certificate of title designated as “Plaintiff [Bokker’s] Exhibit No. 2.” In conclusion, I am concerned that today’s decision may have unintended adverse effects on existing hens perfected by Arkansas dealers and other persons selling cars. Obviously, the General Assembly, in passing Act 737, never intended that dealers or vendors selling cars must still comply with the tide-retention language in § 18-45-202(b) before they can perfect their lien. Such an interpretation of these provisions would be absurd and would require such vendors to violate the 1991 law against using title-retention instruments. The General Assembly made it perfectly clear in Act 737 that all it intended was to prohibit dealers from retaining title to a sold vehicle until the purchaser paid the note or contract in full. In doing so, it specifically stated it did not intend to limit a dealer’s/ lienholder’s rights to perfect its security interest. In Act 737, the General Assembly provided that all laws and parts of laws in conflict with the Act are repealed. That is precisely what occurred here — the “retaining title” phrase in § 18-45-202(b) is in conflict with Act 737 and in particular with paragraph (d) of that Act. In short, Bokker’s Used Cars complied with Arkansas’s existing vendor-lien laws, and Bokker’s lien rights should be enforced. The majority court’s interpretation of those provisions to the contrary is seriously flawed, and most likely will prove to have a ripple effect on other vendor’s who have appropriately followed the same lien procedures Bokker’s Used Cars did in this cause.