37-1282 Department of Motor Vehicles; implement electronic title and lien system for motorboats; security interest; financing instruments; provisions applicable; priority; notation of liens; cancellat - Nebraska Statutes

37-1282. Departmentof Motor Vehicles; implement electronic title and lien system for motorboats;security interest; financing instruments; provisions applicable;priority; notation of liens; cancellation.(1) The Department of Motor Vehicles shall implement anelectronic title and lien system for motorboats no later than January 1, 2011.The Director of Motor Vehicles shall designate the date for the implementationof the system. Beginning on the implementation date, the holder of a securityinterest, trust receipt, conditional sales contract, or similar instrumentregarding a motorboat may file a lien electronically as prescribed by thedepartment. Beginning on the implementation date, upon receipt of an applicationfor a certificate of title for a motorboat, any lien filed electronicallyshall become part of the electronic certificate of title record created bythe county clerk, designated county official, or department maintained onthe electronic title and lien system. Beginning on the implementation date,if an application for a certificate of title indicates that there is a lienor encumbrance on a motorboat or if a lien or notice of lien has been filedelectronically, the department shall retain an electronic certificate of titlerecord and shall note and cancel such liens electronically on the system.The department shall provide access to the electronic certificate of titlerecords for motorboat dealers and lienholders who participate in the systemby a method determined by the director.(2) The provisions of article 9, Uniform CommercialCode, shall not be construed to apply to or to permit or require the deposit,filing, or other record whatsoever of a security agreement, conveyance intendedto operate as a mortgage, trust receipt, conditional sales contract, or similarinstrument or any copy of the same covering a motorboat. Any mortgage, conveyanceintended to operate as a security agreement as provided by article 9, UniformCommercial Code, trust receipt, conditional sales contract, or other similarinstrument covering a motorboat, if such instrument is accompanied by deliveryof such manufacturer's or importer's certificate and followed by actual andcontinued possession of same by the holder of the instrument or, in the caseof a certificate of title, if a notation of same has been made electronically as prescribed in subsection(1) of this section or by the county clerk, the designated countyofficial, or the department onthe face of the certificate of title oron the electronic certificate of title record, shall be validas against the creditors of the debtor, whether armed with process or not,and subsequent purchasers, secured parties, and other lienholders or claimants,but otherwise shall not be valid against them, except that during any periodin which a motorboat is inventory, as defined in section 9-102, Uniform CommercialCode, held for sale by a person or corporation that is in the business ofselling motorboats, the filing provisions of article 9, Uniform CommercialCode, as applied to inventory, shall apply to a security interest in the motorboatcreated by such person or corporation as debtor without the notation of lienon the instrument of title. A buyer at retail from a dealer of any motorboatin the ordinary course of business shall take the motorboat free of any securityinterest.(3) All liens, security agreements,and encumbrances noted upon a certificate of title or an electronic certificate of title record and all liensnoted electronically as prescribed in subsection (1) of this section shalltake priority according to the order of time in which the same are noted onthe certificate of title by the county clerk, the designated county official,or the department. Exposure for sale of any motorboat by the owner thereofwith the knowledge or with the knowledge and consent of the holder of anylien, security agreement, or encumbrance on the motorboat shall not renderthe same void or ineffective as against the creditors of the owner or holderof subsequent liens, security agreements, or encumbrances upon the motorboat.(4) Upon presentation of asecurity agreement, trust receipt, conditional sales contract, or similarinstrument to the county clerk, designated county official, or department together withthe certificate of title and the fee prescribed by section 37-1287, the holderof such instrument may have a notation of the lien made on the face of thecertificate of title. The owner of a motorboat may present a valid out-of-statecertificate of title issued to such owner for such motorboat with a notationof lien on such certificate of title and the prescribed fee to the countyclerk, designated county official, or department and have the notation oflien made on thenew certificate of title issued pursuant to section 37-1278 without presentinga copy of the lien instrument. The county clerk, the designated county official,or the department shall enter the notation and the date thereof over the signatureof the person making the notation and the seal of office. If noted by a county clerk or designated county official,he or she shall on that day notify the department which shall note the lienon its records. The county clerk, the designated county official,or the department shall also indicate by appropriate notation and on suchinstrument itself the fact that the lien has been noted on the certificateof title.(5) The county clerk, thedesignated county official, or the department, upon receipt of a lien instrumentduly signed by the owner in the manner prescribed by law governing such lieninstruments together with the fee prescribed for notation of lien, shall notifythe first lienholder to deliver to the county clerk, the designated countyofficial, or the department, within fifteen days from the date of notice,the certificate of title to permit notation of suchother lien and, after notation of suchother lien, the county clerk, the designated county official,or the department shall deliver the certificate of title to the first lienholder.The holder of a certificate of title who refuses to deliver a certificateof title to the county clerk, the designated county official, or the departmentfor the purpose of showing such other lienon the certificate of title within fifteen days from the date when notifiedto do so shall be liable for damages to such other lienholderfor the amount of damages such other lienholdersuffered by reason of the holder of the certificate of title refusing to permitthe showing of such lien on the certificateof title.(6) Beginning on theimplementation date of the electronic title and lien system, upon receiptof a subsequent lien instrument duly signed by the owner in the manner prescribedby law governing such lien instruments or a notice of lien filed electronically,together with an application for notation of the subsequent lien, the feeprescribed in section 37-1287, and, if a printed certificate of title exists,the presentation of the certificate of title, the county clerk, designatedcounty official, or department shall make notation of such other lien. Ifthe certificate of title is not an electronic certificate of title record,the county clerk, designated county official, or department, upon receiptof a lien instrument duly signed by the owner in the manner prescribed bylaw governing such lien instruments together with the fee prescribed for notationof lien, shall notify the first lienholder to deliver to the county clerk,designated county official, or department, within fifteen days after the dateof notice, the certificate of title to permit notation of such other lien.After such notation of lien, the lien shall become part of the electroniccertificate of title record created by the county clerk, designated countyofficial, or department which is maintained on the electronic title and liensystem. The holder of a certificate of title who refuses to deliver a certificateof title to the county clerk, designated county official, or department forthe purpose of noting such other lien on such certificate of title withinfifteen days after the date when notified to do so shall be liable for damagesto such other lienholder for the amount of damages such other lienholder sufferedby reason of the holder of the certificate of title refusing to permit thenoting of such lien on the certificate of title.(7) When the lien is discharged, the holdershall, within fifteen days after payment is received, note a cancellationof the lien on the face of the certificate of title over his, her, or itssignature and deliver the certificate of title to the county clerk, the designatedcounty official, or the department which shall note the cancellation of thelien on the face of the certificate of title and on the records of the office.If delivered to a county clerk or designated county official, he or she shallon that day notify the department which shall note the cancellation on itsrecords. The county clerk, the designated county official, or the departmentshall then return the certificate of title to the owner or as otherwise directedby the owner. The cancellation of the lien shall be noted on the certificateof title without charge. Foran electronic certificate of title record, the lienholder shall, within fifteendays after payment is received when such lien is discharged, notify the departmentelectronically or provide written notice of such lien release, in a mannerprescribed by the department, to the county clerk, designated county official,or department. The department shall note the cancellation of lien and, ifno other liens exist, issue the certificate of title to the owner or as otherwisedirected by the owner or lienholder. If the holder of the certificate of titlecannot locate a lienholder, a lien may be discharged ten years after the dateof filing by presenting proof that thirty days have passed since the mailingof a written notice by certified mail, return receipt requested, to the last-knownaddress of the lienholder. SourceLaws 1994, LB 123, § 10; Laws 1996, LB 464, § 18; Laws 1999, LB 550, § 7; Laws 2008, LB756, § 1; Laws 2009, LB202, § 5. Cross ReferencesCertificate of title, negligent execution by government employee, see sections 13-910 and 81-8,219.