TITLE 31

Motor and Other vehicles

CHAPTER 31-3.1

Certificates of Title and Security Interests

SECTION 31-3.1-9



   § 31-3.1-9  Registration without

certificate of title – Bond. –

If the division of motor vehicles is not satisfied as to the ownership of the

vehicle or that there are no undisclosed security interests in it, the division

of motor vehicles may register the vehicle but shall either:



   (1) Withhold issuance of a certificate of title until the

applicant presents documents reasonably sufficient to satisfy the division of

motor vehicles as to the applicant's ownership of the vehicle and that there

are no undisclosed security interests in it; or



   (2) As a condition of issuing a certificate of title, require

the applicant to file with the division of motor vehicles a bond in the form

prescribed by the division of motor vehicles and executed by the applicant, and

either accompanied by the deposit of cash with the division of motor vehicles

or also executed by a person authorized to conduct a surety business in this

state. The bond shall be in the amount equal to one and one-half (1 1/2) times

the value of the vehicle, as determined by the division of motor vehicles. This

amount will be conditioned to indemnify any prior owner and lienholder and any

subsequent purchaser of the vehicle or person acquiring any security interest

in it, and their respective successors in interest, against any expense, loss,

or damage, including reasonable attorney's fees, by reason of the issuance of

the certificate of title of the vehicle or an account of any defect in or

undisclosed security interest upon the right, title, and interest of the

applicant in and to the vehicle. Any interested person has a right of action to

recover on the bond for any breach of its conditions, but the aggregate

liability of the surety to all persons shall not exceed the amount of the bond.

The bond, and any deposit accompanying it, shall be returned at the end of

three (3) years or prior to that time if the vehicle is no longer registered in

this state and the currently valid certificate of title is surrendered to the

division of motor vehicles unless the division of motor vehicles has been

notified of the pendency of an action to recover on the bond.



History of Section.

(P.L. 1971, ch. 100, § 1.)