Kentucky Senate Bill 372

[TowForce]

 

 

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(3) Except as provided in subsection (6) of this section, the notation of security1
interests relating to property required to be titled under this chapter in Kentucky2
through the county clerk shall be done in the office of the county clerk of the county3
in which the debtor resides as determined by subsections (2) and (4) of this section.4
The security interest shall be deemed to be noted on the certificate of title and5
perfected, or deemed perfected at the time the security interest attaches as provided6
in KRS 355.9-203, if in compliance with KRS 186A.195(5), when a title lien7
statement:8
(a) Is received by the county clerk in the county in which residence of the debtor9
resides as determined under the provisions of this section together with the10
required fees, as designated by the debtor in the sworn statement;11
(b) Describes the titled vehicle, or vehicle to be titled, by year, model, make, and12
vehicle identification number;13
(c) Provides the name of the secured party, or a representative of the secured14
party, together with the additional information about the secured party15
required by subsection (9) of this section with reasonable particularity; and16
(d) Includes the date and time-stamped entry of the notation of the security17
interest by the county clerk of the required information in the Automated18
Vehicle Information System (AVIS), or its successor title processing system19
maintained by the Division of Motor Vehicle Licensing of the Transportation20
Cabinet.21
(4) Except as provided in subsection (6) of this section, if the debtor is other than a22
natural person, the following provisions govern the determination of the county of23
the debtor's residence:24
(a) A partnership shall be deemed a resident of the county in which its principal25
place of business in this state is located. If the debtor does not have a place of26
business in this state, then the debtor shall be deemed a nonresident for27

 

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purposes of filing in this state;1
(b) A limited partnership organized under KRS Chapter 362 or as defined in KRS2
362.2-102(14) shall be deemed a resident of the county in which its principal3
place of business is located, as set forth in its certificate of limited partnership4
or most recent amendment thereto filed pursuant to KRS Chapter 362 or5
362.2-202. If such office is not located in this state, the debtor shall be6
deemed a nonresident for purposes of filing in this state;7
(c) A limited partnership not organized under the laws of this state and authorized8
to do business in this state shall be deemed a resident of the county in which9
the office of its process agent is located, as set forth in the designation or most10
recent amendment thereto filed with the Secretary of State of the11
Commonwealth of Kentucky;12
(d) A corporation organized under KRS Chapter 271B, 273, or 274 or a limited13
liability company organized under KRS Chapter 275 shall be deemed a14
resident of the county in which its registered office is located, as set forth in15
its most recent corporate filing with the Secretary of State which officially16
designates its current registered office;17
(e) A corporation not organized under the laws of this state, but authorized to18
transact or do business in this state under KRS Chapter 271B, 273, or 274, or19
a limited liability company not organized under the laws of this state, but20
authorized to transact business in this state under KRS Chapter 275, shall be21
deemed a resident of the county in which its registered office is located, as set22
forth in its most recent filing with the Secretary of State which officially23
designates its current registered office;24
(f) A cooperative corporation or association organized under KRS Chapter 27225
shall be deemed a resident of the county in which its principal business is26
transacted, as set forth in its articles of incorporation or most recent27

 

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amendment thereto filed with the Secretary of State of the Commonwealth of1
Kentucky;2
(g) A cooperative corporation organized under KRS Chapter 279 shall be deemed3
a resident of the county in which its principal office is located, as set forth in4
its articles of incorporation or most recent amendment thereto filed with the5
Secretary of State of the Commonwealth of Kentucky;6
(h) A business trust organized under KRS Chapter 386 shall be deemed a resident7
of the county in which its principal place of business is located, as evidenced8
by the recordation of its declaration of trust in that county pursuant to KRS9
Chapter 386;10
(i) A credit union organized under Subtitle 6 of KRS Chapter 286 shall be11
deemed a resident of the county in which its principal place of business is12
located, as set forth in its articles of incorporation or most recent amendment13
thereto filed with the Secretary of State of the Commonwealth of Kentucky;14
and15
(j) Any other organization defined in KRS 355.1-201 shall be deemed a resident16
of the county in which its principal place of business in this state is located,17
except that any limited liability company, limited liability partnership, limited18
partnership, or corporation not organized under the laws of this state and not19
authorized to transact or do business in this state shall be deemed a20
nonresident for purposes of filing in this state. If the organization does not21
have a place of business in this state, then it shall be deemed a nonresident for22
purposes of filing in this state.23
If the debtor does not reside in the Commonwealth, the notation of the security24
interest shall be done in the office of the county clerk in which the property is25
principally situated or operated. Notwithstanding the existence of any filed26
financing statement under the provisions of KRS Chapter 355 relating to any27

 

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property registered or titled in Kentucky, the sole means of perfecting and1
discharging a security interest in property for which a certificate of title is required2
by this chapter is by notation on the property's certificate of title under the3
provisions of this chapter or in accordance with the provisions of KRS 186.045(3).4
In other respects the security interest is governed by the provisions of KRS Chapter5
355.6
(5) Except as provided in subsection (6) of this section, before ownership of property7
subject to a lien evidenced by notation on the certificate of title may be transferred,8
the transferor shall obtain the release of the prior liens in his name against the9
property being transferred. Once a security interest has been noted on the owner's10
title, a subsequent title shall not be issued by any county clerk free of the notation11
unless the owner's title is presented to the clerk and it has been noted thereon that12
the security interest has been discharged. If this requirement is met, information13
relating to any security interest shown on the title as having been discharged may be14
omitted from the title to be issued by the clerk. If information relating to the15
discharge of a security interest is presented to a clerk under the provisions of KRS16
186.045(3), the clerk shall discharge the security interest and remove the lien17
information from AVIS.18
(6) Notwithstanding subsections (1) to (5) of this section, a county clerk shall,19
following inspection of the vehicle by the sheriff, to determine that the vehicle has20
not been stolen, issue a new ownership document to a vehicle, clear of all prior21
liens, to a person after he or she provides to the county clerk an affidavit devised by22
the Transportation Cabinet and completed by the person. The ownership document23
presented as a result of this affidavit shall be in accordance with subsection (7) of24
this section. In the affidavit, the affiant shall attest that:25
(a) The affiant or the agent of the affiant possesses the vehicle;26
(b) Before he or she provided the notices required by paragraphs (c) and (d) of27

 

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this subsection:1
1. A debt on the vehicle has been owed him or her for more than thirty (30)2
days;3
2. Within thirty (30) days of payment of damages by an insurance4
company and receipt by the current owner of the motor vehicle or5
lienholder of damages pursuant to a claim settlement which required6
transfer of the vehicle to the insurance company, the insurance company7
has been unable to obtain:8
a. A properly endorsed certificate of title on the vehicle from the9
current owner; and10
b. If applicable, any lien satisfactions; or11
3. [a. ]The vehicle was:12
a. Voluntarily towed or transported pursuant to a request of the13
current owner or an insurance company that a motor vehicle14
dealer, licensed as a used motor vehicle dealer and motor vehicle15
auction dealer, take possession of and store the motor vehicle in16
the regular course of business; or17
b. Involuntarily towed or transported under the provisions of KRS18
376.275; and19
c.[b.] Within forty-five (45) days of taking possession of the motor20
vehicle, the motor vehicle dealer, or the towing or storage21
company, has not been paid storage fees by the current owner or22
lienholder and has not been provided both a properly endorsed23
certificate of title and if applicable, any lien satisfactions;24
(c) More than thirty (30) days before presenting the affidavit to the county clerk,25
the affiant attempted to notify the owner of the vehicle and all known26
lienholders, including those noted on the title, by certified mail, return receipt27

 

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requested, or by a nationally recognized courier service, of his or her name,1
address, and telephone number as well as his or her intention to obtain a new2
title or salvage title, as applicable, clear of all prior liens, unless the owner or3
a lienholder objects in writing;4
(d) More than fourteen (14) days before presenting the affidavit to the county5
clerk, the affiant had published a legal notice stating his or her intention to6
obtain title to the vehicle. The legal notice appeared at least twice in a seven7
(7) day period in a newspaper with circulation in the county. The legal notice8
stated:9
1. The affiant's name, address, and telephone number;10
2. The owner's name;11
3. The names of all known lienholders, including those noted on the title;12
4. The vehicle's make, model, and year; and13
5. The affiant's intention to obtain title to the vehicle unless the owner or a14
lienholder objects in writing within fourteen (14) days after the last15
publication of the legal notice; and16
(e) Neither the owner nor a lienholder has objected in writing to the affiant's right17
to obtain title to the vehicle.18
(7) (a) If subsection (6)(b)1. of this section applies, the new ownership document19
shall be a title.20
(b) If subsection (6)(b)2. or 3. of this section applies, the new ownership21
document shall be a salvage title if the vehicle meets the requirements for a22
salvage title as stated in KRS 186A.520(1)(a).23
(c) If subsection (6)(b)2. or 3. of this section applies and the vehicle does not24
meet the requirements for a salvage title as stated in KRS 186A.520(1)(a), the25
new ownership document shall be a title.26
(8) No more than two (2) active security interests may be noted upon a certificate of27

 

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title.1
(9) In noting a security interest upon a certificate of title, the county clerk shall ensure2
that the certificate of title bears the lienholder's name, mailing address and zip code,3
the date the lien was noted, the notation number, and the county in which the4
security interest was noted. The clerk shall obtain the information required by this5
subsection for notation upon the certificate of title from the title lien statement6
described in KRS 186A.195 to be provided to the county clerk by the secured party.7
(10) For all the costs incurred in the notation and discharge of a security interest on the8
certificate of title, the county clerk shall receive the fee prescribed by KRS 64.012.9
The fee prescribed by this subsection shall be paid at the time of submittal of the10
title lien statement described in KRS 186A.195.11
(11) A copy of the application, certified by the county clerk, indicating the lien will be12
noted on the certificate of title shall be forwarded to the lienholder.13
Section 2. KRS 186A.190 (Effective January 1, 2025) is amended to read as14
follows:15
(1) Except as provided in subsection (6) of this section and in KRS 355.9-311(4), the16
perfection of a security interest in any property for which has been issued a17
Kentucky certificate of title shall be by notation on the certificate of title which18
shall be deemed to have occurred when the provisions of subsection (3) of this19
section have been complied with. Discharge of a security interest shall be by20
notation on the certificate of title. Notation shall be made by the entry of21
information required by subsection (9) of this section into the Automated Vehicle22
Information System. The notation of the security interest on the certificate of title23
shall be in accordance with this chapter and shall remain effective from the date on24
which the security interest is noted on the certificate of title for a period of ten (10)25
years, or, in the case of a manufactured home, for a period of thirty (30) years, or26
until discharged under this chapter and KRS Chapter 186. The filing of a27

 

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continuation statement within the six (6) months preceding the expiration of the1
initial period of a notation's effectiveness extends the expiration date for five (5)2
additional years, commencing on the day the notation would have expired in the3
absence of the filing. Succeeding continuation statements may be filed in the same4
manner to continue the effectiveness of the initial notation.5
(2) A motor vehicle dealer, a secured party or its representative, an assignee of a retail6
installment contract lender, the cabinet, or a county clerk shall rely on a county of7
residence designated by the debtor on any approved, notarized state form utilized in8
lien titling or the title transfer process signed by the debtor. Reliance on the9
foregoing by the motor vehicle dealer, secured parties, cabinet, and county clerk10
shall relieve those persons from liability to any third party claiming failure to11
comply with this section.12
(3) Except as provided in subsection (6) of this section, the notation of security13
interests relating to property required to be titled under this chapter in Kentucky14
through the cabinet shall be done in the office of a county clerk. The notation of a15
security interest shall reflect the county in which the debtor resides as determined16
by subsections (2) and (4) of this section. The security interest shall be deemed to17
be noted on the certificate of title and perfected, or deemed perfected at the time the18
security interest attaches as provided in KRS 355.9-203, if in compliance with KRS19
186A.195(7), when a title lien statement:20
(a) Is received by the county clerk, together with the required fees;21
(b) Describes the titled vehicle, or vehicle to be titled, by year, model, make, and22
vehicle identification number;23
(c) Provides the name of the secured party, or a representative of the secured24
party, together with the additional information about the secured party25
required by subsection (9) of this section with reasonable particularity; and26
(d) Includes the date and time-stamped entry of the notation of the security27

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interest by the county clerk of the required information in the Automated1
Vehicle Information System (AVIS), or its successor title processing system2
maintained by the Division of Motor Vehicle Licensing of the Transportation3
Cabinet.4
(4) Except as provided in subsection (6) of this section, if the debtor is other than a5
natural person, the following provisions govern the determination of the county of6
the debtor's residence:7
(a) A partnership shall be deemed a resident of the county in which its principal8
place of business in this state is located. If the debtor does not have a place of9
business in this state, then the debtor shall be deemed a nonresident for10
purposes of filing in this state;11
(b) A limited partnership organized under KRS Chapter 362 or as defined in KRS12
362.2-102(14) shall be deemed a resident of the county in which its principal13
place of business is located, as set forth in its certificate of limited partnership14
or most recent amendment thereto filed pursuant to KRS Chapter 362 or15
362.2-202. If the office is not located in this state, the debtor shall be deemed16
a nonresident for purposes of filing in this state;17
(c) A limited partnership not organized under the laws of this state and authorized18
to do business in this state shall be deemed a resident of the county in which19
the office of its process agent is located, as set forth in the designation or most20
recent amendment thereto filed with the Secretary of State of the21
Commonwealth of Kentucky;22
(d) A corporation organized under KRS Chapter 271B, 273, or 274 or a limited23
liability company organized under KRS Chapter 275 shall be deemed a24
resident of the county in which its registered office is located, as set forth in25
its most recent corporate filing with the Secretary of State which officially26
designates its current registered office;27

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(e) A corporation not organized under the laws of this state, but authorized to1
transact or do business in this state under KRS Chapter 271B, 273, or 274, or2
a limited liability company not organized under the laws of this state, but3
authorized to transact business in this state under KRS Chapter 275, shall be4
deemed a resident of the county in which its registered office is located, as set5
forth in its most recent filing with the Secretary of State which officially6
designates its current registered office;7
(f) A cooperative corporation or association organized under KRS Chapter 2728
shall be deemed a resident of the county in which its principal business is9
transacted, as set forth in its articles of incorporation or most recent10
amendment thereto filed with the Secretary of State of the Commonwealth of11
Kentucky;12
(g) A cooperative corporation organized under KRS Chapter 279 shall be deemed13
a resident of the county in which its principal office is located, as set forth in14
its articles of incorporation or most recent amendment thereto filed with the15
Secretary of State of the Commonwealth of Kentucky;16
(h) A business trust organized under KRS Chapter 386 shall be deemed a resident17
of the county in which its principal place of business is located, as evidenced18
by the recordation of its declaration of trust in that county pursuant to KRS19
Chapter 386;20
(i) A credit union organized under Subtitle 6 of KRS Chapter 286 shall be21
deemed a resident of the county in which its principal place of business is22
located, as set forth in its articles of incorporation or most recent amendment23
thereto filed with the Secretary of State of the Commonwealth of Kentucky;24
and25
(j) Any other organization defined in KRS 355.1-201 shall be deemed a resident26
of the county in which its principal place of business in this state is located,27
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except that any limited liability company, limited liability partnership, limited1
partnership, or corporation not organized under the laws of this state and not2
authorized to transact or do business in this state shall be deemed a3
nonresident for purposes of filing in this state. If the organization does not4
have a place of business in this state, then it shall be deemed a nonresident for5
purposes of filing in this state.6
If the debtor does not reside in the Commonwealth, the notation of the security7
interest shall be done in the office of the county clerk in which the property is8
principally situated or operated. Notwithstanding the existence of any filed9
financing statement under the provisions of KRS Chapter 355 relating to any10
property registered or titled in Kentucky, the sole means of perfecting and11
discharging a security interest in property for which a certificate of title is required12
by this chapter is by notation on the property's certificate of title under the13
provisions of this chapter or in accordance with the provisions of KRS 186.045(3).14
In other respects the security interest is governed by the provisions of KRS Chapter15
355.16
(5) Except as provided in subsection (6) of this section, before ownership of property17
subject to a lien evidenced by notation on the certificate of title may be transferred,18
the transferor shall obtain the release of the prior liens in his or her name against the19
property being transferred. Once a security interest has been noted on the owner's20
title, a subsequent title shall not be issued by any county clerk free of the notation21
unless it has been noted in the system of record established under KRS 186A.19522
that the security interest has been discharged. If this requirement is met, information23
relating to any security interest shown on the title as having been discharged may be24
omitted from the title to be issued by the clerk. If information relating to the25
discharge of a security interest is presented to a clerk under the provisions of KRS26
186.045(3), the clerk shall discharge the security interest and remove the lien27

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information from AVIS.1
(6) Notwithstanding subsections (1) to (5) of this section, a county clerk shall,2
following inspection of the vehicle by the sheriff, to determine that the vehicle has3
not been stolen, issue a new ownership document to a vehicle, clear of all prior4
liens, to a person after he or she provides to the county clerk an affidavit devised by5
the Transportation Cabinet and completed by the person. The ownership document6
presented as a result of this affidavit shall be in accordance with subsection (7) of7
this section. In the affidavit, the affiant shall attest that:8
(a) The affiant or the agent of the affiant possesses the vehicle;9
(b) Before he or she provided the notices required by paragraphs (c) and (d) of10
this subsection:11
1. A debt on the vehicle has been owed him or her for more than thirty (30)12
days;13
2. Within thirty (30) days of payment of damages by an insurance14
company and receipt by the current owner of the motor vehicle or15
lienholder of damages pursuant to a claim settlement which required16
transfer of the vehicle to the insurance company, the insurance company17
has been unable to obtain:18
a. A properly endorsed certificate of title on the vehicle from the19
current owner; and20
b. If applicable, any lien satisfactions; or21
3. [a.] The vehicle was:22
a. Voluntarily towed or transported pursuant to a request of the23
current owner or an insurance company that a motor vehicle24
dealer, licensed as a used motor vehicle dealer and motor vehicle25
auction dealer, take possession of and store the motor vehicle in26
the regular course of business; or27

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b. Involuntarily towed or transported under the provisions of KRS1
376.275; and2
c.[b.] Within forty-five (45) days of taking possession of the motor3
vehicle, the motor vehicle dealer, or the towing or storage4
company, has not been paid storage fees by the current owner or5
lienholder and has not been provided both a properly endorsed6
certificate of title and if applicable, any lien satisfactions;7
(c) More than thirty (30) days before presenting the affidavit to the county clerk,8
the affiant attempted to notify the owner of the vehicle and all known9
lienholders, including those noted on the title, by certified mail, return receipt10
requested, or by a nationally recognized courier service, of his or her name,11
address, and telephone number as well as his or her intention to obtain a new12
title or salvage title, as applicable, clear of all prior liens, unless the owner or13
a lienholder objects in writing;14
(d) More than fourteen (14) days before presenting the affidavit to the county15
clerk, the affiant had published a legal notice stating his or her intention to16
obtain title to the vehicle. The legal notice appeared at least twice in a seven17
(7) day period in a newspaper with circulation in the county. The legal notice18
stated:19
1. The affiant's name, address, and telephone number;20
2. The owner's name;21
3. The names of all known lienholders, including those noted on the title;22
4. The vehicle's make, model, and year; and23
5. The affiant's intention to obtain title to the vehicle unless the owner or a24
lienholder objects in writing within fourteen (14) days after the last25
publication of the legal notice; and26
(e) Neither the owner nor a lienholder has objected in writing to the affiant's right27

 

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to obtain title to the vehicle.1
(7) (a) If subsection (6)(b)1. of this section applies, the new ownership document2
shall be a title.3
(b) If subsection (6)(b)2. or 3. of this section applies, the new ownership4
document shall be a salvage title if the vehicle meets the requirements for a5
salvage title as stated in KRS 186A.520(1)(a).6
(c) If subsection (6)(b)2. or 3. of this section applies and the vehicle does not7
meet the requirements for a salvage title as stated in KRS 186A.520(1)(a), the8
new ownership document shall be a title.9
(8) No more than two (2) active security interests may be noted upon a certificate of10
title.11
(9) In noting a security interest upon a certificate of title, the county clerk shall ensure12
that the certificate of title bears the lienholder's name, mailing address and zip code,13
the date the lien was noted, the notation number, and the county in which the14
security interest was noted. The clerk shall obtain the information required by this15
subsection for notation upon the certificate of title from the title lien statement16
described in KRS 186A.195.17
(10) For all the costs incurred in the notation and discharge of a security interest on the18
certificate of title, the county clerk shall receive the fee prescribed by KRS 64.012.19
The fee prescribed by this subsection shall be paid at the time of submittal of the20
title lien statement described in KRS 186A.195.21
(11) A copy of the application, certified by the county clerk, indicating the lien will be22
noted on the certificate of title shall be forwarded to the lienholder.