TCA § 55-3-126 — Constructive notice of lien upon filing request for notation — Method of giving notice — Perfection of security interest

Except as provided for manufactured homes complying with the requirements of § 55-3-128, 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. 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. The security interest is perfected as of the date of delivery to the county clerk or the department. 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. Nothing in subdivision (b)(3)(A) shall have any effect on perfection and constructive notice concerning first liens. 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 the county clerk, as shown by its endorsements of the date of delivery on the document. 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 chapters 1-6 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 1-6 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). With respect to implements of husbandry and special mobile equipment, the perfection of a security interest under chapters 1-6 of this title is not effective until the lienholder has complied with applicable law that otherwise relates 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. 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 an application for motor vehicle temporary lien with the secretary of state. The filing fee for each application for motor vehicle temporary lien is ten dollars ($10.00). The filing of an application for motor vehicle temporary lien 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. The constructive notice shall be effective from the time of the filing of the application for motor vehicle temporary lien 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. 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. 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. The application for motor vehicle temporary lien shall be accompanied by the required filing fee, shall be on a form designed by the secretary of state, and shall contain the following information: Name and address of each debtor; Name and address of the first lienholder; Vehicle identification number of the motor vehicle; The date the instrument creating the lien was executed; The name, address and telephone number of the submitter; The name and address to whom acknowledgement of filing should be sent if other than the submitter; and Any other information that the secretary of state deems necessary for the administration of this part. 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. 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. 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. The lienholder listed on an application for motor vehicle temporary lien may correct the application filed with the secretary of state if the application contains an incorrect statement by filing articles of correction. The application shall be corrected in a manner established by the secretary of state and on a form designed by the secretary of state. The articles of correction shall provide the registration number of the application to be corrected. The filing fee to file articles of correction shall be ten dollars ($10.00). The articles of correction are effective on the effective time and date of the application they correct except as to persons relying on the uncorrected application and adversely affected by the correction. As to those persons, the effective date is the date the articles of correction are filed. In addition to the fees authorized in this subsection (f), the secretary of state is authorized to charge an online transaction fee to cover costs associated with processing payments for an application for motor vehicle temporary lien, articles of correction, and certificate requests submitted online. An application for motor vehicle temporary lien and articles of correction shall be rejected if they contain information that the secretary of state is unable to read or decipher. The comptroller of the treasury shall, as part of the review and/or audit of the office of the secretary of state, include the implementation and impact of subsection (f) and shall report its findings and recommendations regarding subsection (f) in such review and/or audit of the office of secretary of state.