45th legislature - STATE OF NEW MEXICO - first session, 2001

RELATING TO MOTOR VEHICLES; AMENDING THE MOTOR VEHICLE CODE TO PROVIDE FOR SEPARATE LICENSES AND BONDS FOR DEALERS, WRECKERS, WHOLESALERS, DISTRIBUTORS AND TITLE SERVICE COMPANIES; PROVIDING ADDITIONAL REQUIREMENTS FOR WRECKERS.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:

Section 1. Section 66-4-1 NMSA 1978 (being Laws 1978, Chapter 35, Section 214, as amended) is amended to read:

"66-4-1. DEALERS, WRECKERS, WHOLESALERS AND DISTRIBUTORS OF VEHICLES AND TITLE SERVICE COMPANIES MUST BE LICENSED--PRESUMPTION OF CONDUCTING BUSINESS.--

A. No person, unless licensed to do so by the department, shall carry on or conduct the active trade or business of:

(1) a dealer in motor vehicles of a type subject to registration pursuant to the Motor Vehicle Code;

(2) wrecking or dismantling [any] a vehicle for the resale of the parts. [Any] A person possessing three or more wrecked, dismantled or partially wrecked or dismantled vehicles and selling or offering for sale a used vehicle part and who regularly sells or offers for sale used vehicles or used vehicle parts shall be presumed to be conducting the business of wrecking or dismantling a vehicle for the resale of the parts;

(3) wholesaling of vehicles. [Any] A person who sells or offers for sale vehicles of a type subject to registration in this state, to a vehicle dealer licensed pursuant to the Motor Vehicle Code or who is franchised by a manufacturer, distributor or vehicle dealer to sell or promote the sale of vehicles dealt in by such manufacturer, distributor or vehicle dealer shall be presumed to be conducting the business of wholesaling; provided, however, that if [any such] the person also sells a vehicle at retail, he shall be deemed to be a dealer and is subject to the dealer-licensing provisions of the Motor Vehicle Code;

(4) distributing of vehicles. [Any] A person who distributes or sells new or used motor vehicles to dealers and who is not a manufacturer shall be presumed to be conducting the business of distributing vehicles; or

(5) a title service company. [Any] A person who for consideration prepares or submits applications for the registration of or title to vehicles shall be presumed to be engaging in the business of a title service company.

B. A separate license is required for each type of business activity required to be licensed in Subsection A of this section. Application for a dealer, wholesaler, distributor or wrecker of vehicles license or a title service company license shall be made upon the form prescribed by the department and shall contain the name and address of the applicant and, when the applicant is a partnership, the name and address of each partner or, when the applicant is a corporation, the names of the principal officers of the corporation, [and] the state in which incorporated, [and] the place where the business is to be conducted, [and] the nature of the business and such other information as may be required by the department. Every application shall be verified by the oath or affirmation of the applicant, if an individual, or, in the event an applicant is a partnership or corporation, by a partner or officer of the partnership or corporation. Every application shall be accompanied by the fee required by law.

C. [Any] A metal processor or dealer in scrap who dismantles, processes for scrap, shreds, compacts, crushes or otherwise destroys more than three vehicles within a period of one year shall be licensed pursuant to the provisions of Sections 66-4-1 through 66-4-9 NMSA 1978.

D. In order to ensure that a dealer, wholesaler, distributor, wrecker of vehicles or title service company complies with this section, the secretary may apply to a district court of this state to have a person operating without a license as required by this section or operating without the bond required by Section 66-4-7 NMSA 1978 enjoined from engaging in business until that person complies with the requirements of licensing as provided by this section and the bonding requirements of Section 66-4-7 NMSA 1978.

E. Upon application to a court for the issuance of an injunction against an unlicensed person, the court may forthwith issue an order temporarily restraining that person from doing business. The court shall hear the matter within three days and, upon a showing by the preponderance of the evidence that the person is operating without a license and that the person has been given notice of the hearing as required by law, the court may enjoin the person from engaging in business in New Mexico until the person ceases to be unlicensed. Upon issuing an injunction, the court may also order the business premises of the person to be sealed by the sheriff and may allow the person access thereto only upon approval of the court.

F. No temporary restraining order shall be issued against a person who has complied with the provisions of this section. Upon a showing to the court by a person against whom a temporary restraining order has been issued that he has a license in accordance with the provisions of this section, the court shall dissolve or set aside the temporary restraining order."

Section 2. Section 66-4-2 NMSA 1978 (being Laws 1978, Chapter 35, Section 215, as amended) is amended to read:

"66-4-2. DEPARTMENT TO ISSUE LICENSE.--

A. The department, upon receiving application accompanied by the required fee and when satisfied that the applicant is of good character and, so far as can be ascertained, has complied with and will comply with the laws of this state with reference to the registration of vehicles and certificates of title and the provisions of the Motor Vehicle Code, shall issue to the applicant a license [which] that entitles the licensee to carry on and conduct the business of a dealer, wholesaler, distributor, wrecker of vehicles or title service company, as the case may be, during the period for which the license is issued. The license shall expire on the last day of the period for which it is issued and may be renewed upon application and payment of the fee required by law.

B. The department shall not issue a license to conduct business as a wrecker of vehicles unless the department is satisfied that the applicant is in compliance with all state and federal environmental laws and rules related to emissions or discharges from the applicant's business.

[B. Any] C. A dealer or wrecker of vehicles licensee, before moving [any] one or more of the licensee's places of business or opening [any] an additional place of business, shall apply to the department for and obtain a supplemental license for which no fee shall be charged. No supplemental license shall be issued to a dealer, other than a dealer in motorcycles, for an additional place of business unless:

(1) the place of business is an established place of business; or

(2) the majority of dealers, other than dealers in motorcycles, in the county in which the proposed additional place of business would be located have been offered the opportunity, in documentation acceptable to the department, to offer vehicles for sale at the proposed additional place of business by the applicant; provided that the offer shall be for sale of vehicles at all times at which the applicant proposes to sell vehicles and shall not be conditioned upon the payment of any fee by any dealer to whom it is addressed greater than a fair share of the actual expenses incurred.

[C.] D. Any person to whom the department has issued a license to conduct the business of a dealer in motorcycles is deemed a wrecker of motorcycles without additional license.

[D.] E. The department is authorized to establish a staggered system for licensing of dealers, wholesalers, distributors and wreckers of vehicles and of title service companies, provided that any license issued shall expire on the last day of a month. During the initial adjustment period of July 1, 1999 through December 31, 2000, the department may issue licenses for periods less than twelve months or up to twenty-one months to establish a more uniform monthly pattern of expirations. For [any] a license issued for a period other than twelve months during the initial adjustment period, the fee imposed pursuant to Section 66-6-18 NMSA 1978 shall be adjusted accordingly. After the initial adjustment period, licenses issued shall be issued for a period of twelve months."

Section 3. Section 66-4-3 NMSA 1978 (being Laws 1978, Chapter 35, Section 216, as amended) is amended to read:

"66-4-3. REFUSAL TO ISSUE LICENSE--CANCELLATION OR SUSPENSION OF LICENSE OR USE OF TEMPORARY PERMITS--HEARING--APPEAL.--

A. The department may refuse to issue a license for just cause and may cancel or suspend a license or use of temporary permits for violation of the Motor Vehicle Code, or, in the case of a license to conduct business as a wrecker of vehicles, for a violation of a state or federal environmental law or rule related to emissions or discharges from the licensee's business. The department shall take the action authorized in this section only after hearing. Notice of hearing shall be given the party concerned as provided in Section 66-2-11 NMSA 1978. The notice shall state the proposed action of the department and the reason for the proposed action.

B. The department shall prepare rules for the conduct of the hearing. At the hearing, the technical rules of evidence do not apply, and a party has the right to be represented by counsel, to call witnesses in his own behalf and to cross-examine the witnesses of other parties.

C. The secretary or his designated agent shall conduct the hearing for the department and shall cause a record of hearing to be made.

D. Within ten days after completion of the hearing, the secretary shall cause to be served upon all parties, in the manner provided in Section 66-2-11 NMSA 1978, his findings and decision. The decision shall be:

(1) granting a license or refusing to grant a license;

(2) continuing a license, canceling a license or suspending a license for a time stated; or

(3) continuing use of dealer plates and temporary permits, canceling dealer plates and temporary permits or suspending use of temporary permits for a time stated.

E. A party aggrieved by the secretary's decision may file an appeal in the district court pursuant to the provisions of Section 39-3-1.1 NMSA 1978."

Section 4. Section 66-4-7 NMSA 1978 (being Laws 1978, Chapter 35, Section 220, as amended) is amended to read:

"66-4-7. DEALERS, WHOLESALERS, DISTRIBUTORS AND WRECKERS OF VEHICLES--TITLE SERVICE COMPANIES--DEALERS OF MOTORCYCLES ONLY--BOND.--

A. Before issuance of [any] a dealer's license, wholesaler's license, distributor's license, wrecker of vehicles license or title service company license, the applicant shall procure and file with the department a corporate surety bond in the amount of fifty thousand dollars ($50,000). An applicant for a dealer's license for motorcycles only shall procure and file with the department a corporate surety bond in the amount of twelve thousand five hundred dollars ($12,500). The corporate surety shall be licensed by the public regulation commission or a successor entity to do business in this state as a surety, and the form of the bond shall be approved by the attorney general. The bond shall be payable to the state for the use and benefit of the purchaser and his vendees, conditioned upon payment of any loss, damage and expense sustained by the purchaser or his vendees, or both, by reason of failure of the title of the vendor, by [any] fraudulent misrepresentations or by [any] breach of warranty as to freedom from liens on the motor vehicle or motorcycle sold by the dealer, wholesaler, distributor, dealer of motorcycles only or wrecker of vehicles. The bond shall be continuous in form and limited to the payment of fifty thousand dollars ($50,000) in total aggregate liability on a dealer's license, wholesaler's license, distributor's license, wrecker of vehicles license or a title service company license and twelve thousand five hundred dollars ($12,500) on a dealer's license for motorcycles only.

[B. No applicant for a dealer's license, wholesaler's license, distributor's license or dealer's license for motorcycles only who files bond in the amount and form specified in Subsection A of this section shall be required to file any additional bond to conduct a business of wrecking or dismantling motor vehicles or motorcycles. Conversely, no applicant for a wrecker of vehicles license who files bond in the amount and form specified in Subsection A of this section shall be required to file any additional bond to conduct a business of dealer, distributor, wholesaler or dealer of motorcycles only.]

B. An applicant shall obtain a separate bond for each type of license applied for.

C. In lieu of the bond required in this section, the dealer, wholesaler, distributor, wrecker of vehicles or dealer of motorcycles only may elect to file with the department the equivalent amount of cash or bonds of the United States or New Mexico or of any political subdivision of the state.

D. The license of a dealer, wholesaler, distributor or wrecker of vehicles or of a title service company may be suspended or canceled if the dealer, wholesaler, distributor, wrecker of vehicles or title service company fails to have in effect the required bond or other security."

Section 5. Section 66-6-18 NMSA 1978 (being Laws 1978, Chapter 35, Section 353, as amended) is amended to read:

"66-6-18. LICENSE FEE FOR DEALERS, WHOLESALERS, DISTRIBUTORS AND WRECKERS OF VEHICLES AND TITLE SERVICE COMPANIES.--For a license to do business as a dealer, wholesaler, distributor or wrecker of vehicles [or any combination of the foregoing] or as a title service company, there shall be paid a fee of fifty dollars ($50.00) for each license year or portion thereof. A separate fee shall be paid for each license held by the same licensee."

Section 6. TEMPORARY PROVISION--EXISTING LICENSEES.--

A. A person, licensed on July 1, 2001 under Chapter 66, Article 4 NMSA 1978 to conduct more than one business activity under the same license, may continue to conduct all allowed business activities under that license until it expires. Thereafter, the person shall obtain a separate license for each business activity required to be licensed.

B. A person, licensed on July 1, 2001 under Chapter 66, Article 4 NMSA 1978 and conducting more than one business activity under the same bond, may continue to conduct all allowed business activities under that bond until the license expires.

Section 7. EFFECTIVE DATE.--The effective date of the provisions of this act is July 1, 2001.