301.600. Liens and encumbrances, how perfected--effect of on vehicles and trailers brought into state--security procedures for verifying electronic notices. - Missouri Statutes

Liens and encumbrances, how perfected--effect of on vehicles andtrailers brought into state--security procedures for verifyingelectronic notices.

301.600. 1. Unless excepted by section 301.650, a lien orencumbrance on a motor vehicle or trailer, as defined by section 301.010,is not valid against subsequent transferees or lienholders of the motorvehicle or trailer who took without knowledge of the lien or encumbranceunless the lien or encumbrance is perfected as provided in sections 301.600to 301.660.

2. Subject to the provisions of section 301.620, a lien orencumbrance on a motor vehicle or trailer is perfected by the delivery tothe director of revenue of a notice of a lien in a format as prescribed bythe director of revenue. To perfect a subordinate lien, the notice of lienmust be accompanied by the documents required to be delivered to thedirector pursuant to subdivision (3) of section 301.620. The notice oflien is perfected as of the time of its creation if the delivery of suchnotice to the director of revenue is completed within thirty daysthereafter, otherwise as of the time of the delivery. A notice of lienshall contain the name and address of the owner of the motor vehicle ortrailer and the secured party, a description of the motor vehicle ortrailer, including the vehicle identification number, and such otherinformation as the department of revenue may prescribe. A notice of liensubstantially complying with the requirements of this section is effectiveeven though it contains minor errors which are not seriously misleading.Provided the lienholder submits complete and legible documents, thedirector of revenue shall mail confirmation or electronically confirmreceipt of such notice of lien to the lienholder as soon as possible, butno later than fifteen business days after the filing of the notice of lien.

3. Liens may secure future advances. The future advances may beevidenced by one or more notes or other documents evidencing indebtednessand shall not be required to be executed or delivered prior to the date ofthe future advance lien securing them. The fact that a lien may securefuture advances shall be clearly stated on the security agreement and notedas "subject to future advances" on the notice of lien and noted on thecertificate of ownership if the motor vehicle or trailer is subject to onlyone notice of lien. To secure future advances when an existing lien on amotor vehicle or trailer does not secure future advances, the lienholdershall file a notice of lien reflecting the lien to secure future advances.A lien to secure future advances is perfected in the same time and manneras any other lien, except as follows: proof of the lien for futureadvances is maintained by the department of revenue; however, there shallbe additional proof of such lien when the notice of lien reflects such lienfor future advances, is receipted for by the department of revenue, andreturned to the lienholder.

4. If a motor vehicle or trailer is subject to a lien or encumbrancewhen brought into this state, the validity and effect of the lien orencumbrance is determined by the law of the jurisdiction where the motorvehicle or trailer was when the lien or encumbrance attached, subject tothe following:

(1) If the parties understood at the time the lien or encumbranceattached that the motor vehicle or trailer would be kept in this state andit was brought into this state within thirty days thereafter for purposesother than transportation through this state, the validity and effect ofthe lien or encumbrance in this state is determined by the law of thisstate;

(2) If the lien or encumbrance was perfected pursuant to the law ofthe jurisdiction where the motor vehicle or trailer was when the lien orencumbrance attached, the following rules apply:

(a) If the name of the lienholder is shown on an existing certificateof title or ownership issued by that jurisdiction, the lien or encumbrancecontinues perfected in this state;

(b) If the name of the lienholder is not shown on an existingcertificate of title or ownership issued by that jurisdiction, the lien orencumbrance continues perfected in this state three months after a firstcertificate of ownership of the motor vehicle or trailer is issued in thisstate, and also thereafter if, within the three-month period, it isperfected in this state. The lien or encumbrance may also be perfected inthis state after the expiration of the three-month period; in that caseperfection dates from the time of perfection in this state;

(3) If the lien or encumbrance was not perfected pursuant to the lawof the jurisdiction where the motor vehicle or trailer was when the lien orencumbrance attached, it may be perfected in this state; in that caseperfection dates from the time of perfection in this state;

(4) A lien or encumbrance may be perfected pursuant to paragraph (b)of subdivision (2) or subdivision (3) of this subsection either as providedin subsection 2 or 3 of this section or by the lienholder delivering to thedirector of revenue a notice of lien or encumbrance in the form thedirector of revenue prescribes and the required fee.

5. By rules and regulations, the director of revenue shall establisha security procedure for the purpose of verifying that an electronic noticeof lien or notice of satisfaction of a lien on a motor vehicle or trailergiven as permitted in sections 301.600 to 301.640 is that of thelienholder, verifying that an electronic notice of confirmation ofownership and perfection of a lien given as required in section 301.610 isthat of the director of revenue, and detecting error in the transmission orthe content of any such notice. A security procedure may require the useof algorithms or other codes, identifying words or numbers, encryption,callback procedures or similar security devices. Comparison of a signatureon a communication with an authorized specimen signature shall not byitself be a security procedure.

(L. 1965 p. 474 § 1, A.L. 1989 H.B. 211, A.L. 1999 H.B. 795, A.L. 2000 S.B. 896, A.L. 2001 H.B. 738 merged with S.B. 186, A.L. 2002 H.B. 2008 merged with S.B. 895)

Effective 8-28-02 (H.B. 2008)

7-01-03 (S.B. 895)

(1974) Repossession proceedings under this section held not to involve sufficient state action to authorize cause of action under federal civil rights act. Nichols v. Tower Grove Bank (C.A. Mo.), 497 F.2d 404.