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A BILL TO BE ENTITLED
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AN ACT
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relating to the liability of and issuance of titles and permits for |
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motor vehicles purchased from motor vehicle dealers that go out of |
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business. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Subchapter B, Chapter 501, Transportation Code, |
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is amended by adding Section 501.0236 to read as follows: |
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Sec. 501.0236. ISSUANCE OF TITLE AND PERMITS WHEN DEALER |
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GOES OUT OF BUSINESS. (a) This section applies only to a person |
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who is the purchaser of a motor vehicle for which the dealer: |
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(1) is required to apply for a title for the vehicle |
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under Section 501.0234; and |
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(2) does not apply for the title because the dealer has |
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gone out of business. |
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(b) A purchaser to whom this section applies may apply for: |
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(1) a title in the manner prescribed by the department |
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by rule; and |
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(2) on expiration of the buyer's tag issued to the |
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purchaser under Section 503.063, a 30-day permit under Section |
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502.095. |
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(c) An application for a title under this section must |
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include a release of any recorded lien on the motor vehicle unless |
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the only recorded lienholder is a dealer described by Subsection |
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(a). |
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(d) The department shall waive the payment of fees for: |
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(1) a title issued to a purchaser described by this |
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section, if the purchaser can show that fees for a title were paid |
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to the dealer; and |
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(2) one 30-day permit issued to a purchaser described |
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by this section. |
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(e) Notwithstanding Section 503.033(e), the department may |
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recover against the surety bond executed by the dealer under |
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Section 503.033 the amount of any fee waived for a title or permit |
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issued under this section. |
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(f) The department shall adopt the rules necessary to |
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implement this section. |
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SECTION 2. The heading to Section 503.033, Transportation |
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Code, is amended to read as follows: |
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Sec. 503.033. SURETY BOND REQUIRED; LIABILITY OF SURETY |
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[SECURITY REQUIREMENT]. |
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SECTION 3. Sections 503.033(a) and (d), Transportation |
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Code, are amended to read as follows: |
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(a) The department may not issue or renew a motor vehicle |
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dealer general distinguishing number or a wholesale motor vehicle |
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auction general distinguishing number unless the applicant |
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provides to the department[:
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[(1)] satisfactory proof that the applicant has |
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purchased a properly executed surety bond in the amount of $50,000 |
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[$25,000] with a good and sufficient surety approved by the |
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department[; or
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[(2) other security under Subsection (c)]. |
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(d) A person may recover against a surety bond [or other
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security] if the person obtains against a person issued a motor |
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vehicle dealer general distinguishing number or a wholesale motor |
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vehicle auction general distinguishing number a judgment assessing |
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damages and reasonable attorney's fees based on an act or omission |
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on which the bond is conditioned that occurred during the term for |
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which the general distinguishing number was valid. |
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SECTION 4. This Act takes effect September 1, 2019. |