Perfection of security interests. 342.19(1)(1)
Unless excepted by s. 342.02
, a security interest in a vehicle of a type for which a certificate of title is required is not valid against creditors of the owner or subsequent transferees or secured parties of the vehicle unless perfected as provided in this chapter.
Except as provided in sub. (2m)
, a security interest is perfected in one of the following ways:
If the secured party is an individual or a person exempted by rule under s. 342.245 (3)
, by the delivery to the department of the existing certificate of title, if any, an application for a certificate of title containing the name and address of the secured party, and the required fee.
Except as provided in s. 342.245 (3)
, if the secured party is not an individual, by the filing of a security interest statement containing the name and address of the secured party, and payment of the required fee, in the manner specified in s. 342.245 (1)
A security interest is perfected as of the later of the following:
The time of delivery to the department of the certificate of title if perfection occurs under par. (a) 1.
or of the application if perfection occurs under par. (a) 2.
The time of the attachment of the security interest.
If a secured party whose name and address is contained on the certificate of title for a vehicle acquires a new or additional security interest in the vehicle, such security interest is perfected at the time of its attachment under s. 409.203
An unperfected security interest is subordinate to the rights of persons described in ss. 409.317
The rules of priority stated in s. 409.322
, the other sections therein referred to, and subch. III of ch. 409
shall, to the extent appropriate, apply to conflicting security interests in a vehicle of a type for which a certificate of title is required. A security interest perfected under this section is a security interest perfected otherwise than by filing for purposes of subch. III of ch. 409
The rules stated in subch. VI of ch. 409
governing the rights and duties of secured parties and debtors and the requirements for, and effect of, disposition of a vehicle by a secured party, upon default shall, to the extent appropriate, govern the rights of secured parties and owners with respect to security interests in vehicles perfected under this chapter.
If a vehicle is subject to a security interest when brought into this state, s. 409.316
states the rules which apply to determine the validity and perfection of the security interest in this state.
Ch. 342, not ch. 409, governs the perfection of security interests in motor vehicles, but the creation of security interests is governed by ch. 409. Milwaukee Mack Sales v. First Wisconsin National Bank, 93 Wis. 2d 589
, 287 N.W.2d 708
Registration of goods under commercial law is conceptually distinct from registration of vehicles under vehicle registration laws. For a security interest perfected in another state to become unperfected, the requirement of “registration" in s. 409.103 (2) (b) requires both registration and issuance of a certificate of title. Dubis v. General Motors Acceptance Corp. 2000 WI App 209
, 238 Wis. 2d 608
, 618 N.W.2d 266
Notification of person who has perfected security interest.
Upon request of a person who has perfected a security interest under s. 342.19
, as shown by the records of the department, in a vehicle titled in this state, whenever the department receives information from another state that the vehicle is being titled in the other state and the information does not show that the security interest has been satisfied, the department shall notify the person. The person shall pay the department a $2 fee for each notification.
History: 1983 a. 155
; 1985 a. 202
Duties on creation of security interest.
If an owner creates a security interest in a vehicle, unless the name and address of the secured party already is contained on the certificate of title for the vehicle:
The owner shall immediately execute, in the space provided therefor on the certificate of title or on a separate form or in an automated format prescribed by the department, an application to name the secured party on the certificate, showing the name and address of the secured party, and the owner or person in possession of the owner's certificate, as shown by the records of the department, shall cause the certificate, application and the required fee to be delivered to the secured party.
The secured party shall immediately cause the certificate, application, and the required fee to be mailed or delivered to the department, except that if the secured party is not an individual or a person exempted by rule under s. 342.245 (3)
, the secured party shall follow the procedure specified in ss. 342.19 (2) (a) 2.
and 342.245 (1)
Upon receipt of the certificate of title, application, and the required fee, or upon receipt of the security interest statement and required fee if the secured party has utilized the process specified in s. 342.245 (1)
, the department shall issue to the owner a new certificate containing the name and address of the new secured party. The department shall deliver to such new secured party, unless the secured party utilized the process specified in s. 342.245 (1)
, memoranda, in such form as the department prescribes, evidencing the notation of the security interest upon the certificate; and thereafter, upon any assignment, termination or release of the security interest, additional memoranda evidencing such action.
Assignment of security interest. 342.21(1)(1)
Except as otherwise provided in s. 409.308 (5)
, a secured party may assign, absolutely or otherwise, the party's security interest in the vehicle to a person other than the owner without affecting the interest of the owner or the validity of the security interest, but any person without notice of the assignment is protected in dealing with the secured party as the holder of the security interest and the secured party remains liable for any obligations as a secured party until the assignee is named as secured party on the certificate.
Subject to s. 409.308 (5)
, the assignee may but need not, to perfect the assignment, have the certificate of title endorsed or issued with the assignee named as secured party, upon delivering to the department the certificate and an assignment by the secured party named in the certificate in the form the department prescribes.
Release of security interest. 342.22(1)(1)
Within one month or within 10 days following written demand by the debtor after there is no outstanding obligation and no commitment to make advances, incur obligations or otherwise give value, secured by the security interest in a vehicle under any security agreement between the owner and the secured party, the secured party shall mail or deliver the certificate of title for the vehicle to the department if the secured party is in possession of the certificate and shall also do one of the following:
If the secured party is an individual or a person exempted by rule under s. 342.245 (3)
, execute and deliver to the owner, as the department prescribes, a release of the security interest in the form and manner prescribed by the department and a notice to the owner stating in no less than 10-point boldface type the owner's obligation under sub. (2)
. If the secured party fails to execute and deliver the release and notice of the owner's obligation as required by this paragraph, the secured party is liable to the owner for $25 and for any loss caused to the owner by the failure.
If the secured party is not described in par. (a)
, deliver to the department a release of the security interest in the manner specified in s. 342.245 (1)
and deliver to the owner a notice stating that the release has been provided to the department.
If an owner, other than a dealer holding the vehicle for resale, is in possession of the owner's certificate of title, the owner, upon receipt of the release and notice of obligation delivered under sub. (1) (a)
, shall promptly cause the certificate and release to be mailed or delivered to the department, which shall release the secured party's rights on the certificate and issue a new certificate. Upon receipt of the notice under sub. (1) (b)
, the owner may, in the form and manner prescribed by the department and without additional fee, deliver an application and the certificate of title to the department and the department shall issue a new certificate of title free of the security interest notation.
The department may remove information pertaining to a security interest perfected under s. 342.19
from its computerized records when the following applicable period of time after the original perfection has elapsed unless the security interest is renewed in the same manner as provided in s. 342.19 (2)
for perfection of a security interest:
Removal of information pertaining to a security interest from the records of the department under sub. (3)
does not affect any security agreement between the owner of a vehicle and the holder of security interest in the vehicle.
Secured party's and owner's duties. 342.23(1)(1)
A secured party named in a certificate of title shall, upon written request of the owner or of another secured party named on the certificate, disclose any pertinent information as to the party's security agreement and the indebtedness secured by it.
An owner or person in possession of the owner's certificate of title, as shown by the records of the department, shall promptly deliver the certificate of title to any secured party who is named on it or who has a security interest in the vehicle described in it under any other applicable prior law of this state, upon receipt of a notice from such secured party that the security interest is to be assigned, extended or perfected.
Any secured party who fails to disclose information pursuant to sub. (1)
shall be liable for any loss caused to owner thereby.
Any owner or other person in possession of the owner's certificate of title who fails to deliver the certificate of title to a secured party requesting it pursuant to sub. (2)
shall be liable to such secured party for any loss caused to the secured party thereby and may be required to forfeit not more than $200.
Method of perfecting exclusive.
Subject to s. 409.311 (4)
, the method provided in this chapter of perfecting and giving notice of security interests subject to this chapter is exclusive. Security interests subject to this chapter are hereby exempted from the provisions of law which otherwise require or relate to the filing of instruments creating or evidencing security interests.
History: 2001 a. 10
Motor vehicle law provisions relating to security do not apply to a mobile home that has become a fixture. George v. Commercial Credit Corp. 440 F.2d 551
Electronic processing of certain applications. 342.245(1)(1)
Except as provided in sub. (3)
, a secured party shall file a security interest statement and pay the fee under s. 342.19 (2) (a) 2.
and deliver a release of a security interest under s. 342.22 (1) (b)
utilizing an electronic process prescribed by the department under sub. (4)
Upon receipt of a certificate of title as provided in s. 342.20 (1)
, a person required to file a security interest statement under sub. (1)
shall destroy the certificate of title.
The department may, by rule, exempt a person or a type of transaction from the requirements of sub. (1)
. Any person who is exempted under this subsection shall pay a fee to the department for processing applications submitted by the person under s. 342.19 (2) (a) 1.
and releases submitted under s. 342.22
, utilizing a process other than an electronic process.
The department shall promulgate rules to implement and administer this section.
History: 2009 a. 28
See also ch. Trans 148
, Wis. adm. code.
Suspension or revocation of certificate. 342.25(1)(1)
The department shall suspend or revoke a certificate of title if it finds any of the following:
The certificate of title was fraudulently procured, erroneously issued or prohibited by law.
The vehicle has been scrapped, dismantled or destroyed.
A transfer of title is set aside by a court of record by order or judgment.
The vehicle's odometer has been subjected to tampering and return of the certificate of title to the department is considered necessary to make a notation of that information on the certificate.
Suspension or revocation of a certificate of title does not, in itself, affect the validity of a security interest noted on it.
When the department suspends or revokes a certificate of title, the owner or person in possession of it shall, immediately upon receiving notice of the suspension or revocation, mail or deliver the certificate to the department.
The department may seize and impound any certificate of title which has been suspended or revoked.
Cancellation of title or registration.
The department shall cancel a title or registration whenever:
A transfer of title is set aside by the court by order or judgment; or
Fraud on the department or an agent of the department is discovered by the department; or
It is subsequently discovered that the issuance or possession of a title or registration is prohibited by law or that the odometer of a vehicle for which a certificate of title has been issued by the department has been subjected to tampering and return of the certificate of title to the department is considered necessary to make a notation of that information on the certificate.
Hearings and appeal.
Any person aggrieved by an act or omission of the department under this chapter is entitled, upon request, to a hearing and judicial review thereof in accordance with ch. 227
. Contested cases shall be heard and decided by the division of hearings and appeals.
ANTI-THEFT AND ANTI-FRAUD PROVISIONS
Identification numbers. 342.30(1c)(1c)
In this section, “owner" includes the lessee of a vehicle if the vehicle is registered, or required to be registered, by the lessee under ch. 341
Except as provided in par. (b)
, no person may remove, alter or obliterate or intentionally make it impossible to read, as required under sub. (2)
, an identification number. This subsection does not apply to the obliteration of an identification number which occurs in the process of crushing a vehicle or vehicle part for scrap.
A person who repairs a vehicle or vehicle part may remove and replace a decal that contains an identification number if the removal and replacement is reasonably necessary for the repair.
See also ch. Trans 155
, Wis. adm. code.
When the department is satisfied as to the ownership of a vehicle subject to registration which has not been numbered by the manufacturer or on which the original number has been removed, obliterated or altered or on which the original casting has been replaced or on which a new identification number is required under s. 342.06 (1) (f)
, the department shall assign a new identification number for each such vehicle.
Except as provided in this subsection, an identification number assigned by the department to a vehicle shall be permanently affixed to a location on the vehicle specified by the department that is readily visible when observed from outside the vehicle. Identification numbers assigned for cycles shall be stamped on the left side, near the top of the engine casting just below the cylinder barrel. Such stamping or affixing shall be done under the supervision of a dealer, distributor or manufacturer registered under s. 341.51
or under the supervision of a peace officer. The person supervising the stamping or affixing shall make a report thereof to the department. The department shall establish forms to be provided to vehicle owners specifying the location, for various types of vehicles, where identification numbers assigned by the department shall be stamped or affixed.
A traffic officer or person authorized to enforce nonmoving traffic violations may use reasonable means to gain access to a vehicle if that vehicle's identification number cannot be read as required under sub. (2)
Any person acting under par. (a)
is immune from civil and criminal liability for good faith actions taken within the scope of that person's official duties.
Any person who violates sub. (1g)
is guilty of a Class H felony.