Specifically, do we treat lien holders as "owners" too? We did.
We have a car that was abandoned and we notified both the registered owner and the lien holder as required by the CCP. Neither responded in time. If we now sell it, do we (a) sell it subject to the lien (surely not), (b) can we (or the new buyer) avoid the lien, or (c) must we satisfy the lien with the proceeds before depositing the remainder in our general fund?
It seems that by providing notice and an opportunity to respond to the lien holder, we gave them ample opportunity to assert their claim, and that by failing to do so they have "abandoned" the property every bit as much as the registered owner. But I'm a little wary of trying to avoid a lien without a court order of any kind and opening ourselves up to suit by the lien holding bank.
Anyone done enough of these to know?
First off, you should not commingle forfeiture proceeds with your general fund(s). Art. 59 clearly provides for the desigation of a special account(by the county treasurer) to deal with forfeiture proceeds.
Second, you should include the lienholder as a potential claimant in your original notice of seizure just like any other claimant to the vehicle. It is not enough that the lienholder appears on the title or vehicle registration inquiry. You don't know the amount of the lien, or whether it has been paid off, etc. The duty is to notify the lienholder and let them prove they are in fact innocent owners/interest holders. Sometimes they are not.
If the lienholder does not answer, take a default judgment as to their interest and have the judgment reflect that their interest in the vehicle has been forfeited. Now, if there is a valid lien, and the vehicle is worth significantly more than the lien amount, you may forfeit the vehicle and have the judgment recite the vehicle is forfeited to the State, order title be issued to the DA's office, sell the vehicle and pay off the lien from the proceeds. I suppose you could have ask for a finding that there is a valid lien for X amount and that it will be paid from the proceeds of the sale. The trick is telling the bank or lender that you are not paying for any late fees or penalties, etc. In either case, if the lienholder doesn't answer, feel free to default them out, we do it all the time.
Thanks, but this is not a forfeiture under Art 59. This is a distribution of abandoned property under Article 18.17. If it was an Art. 59 forfeiture I would feel fine simply notifying, then defaulting, the lien holder and having a court order to back me up. As it is, Art. 18.17 says we only have to provide notice to the "owner" and, assuming no reply, sell the thing. But it doesn't address lien holders. So what we did was treat the lienholder like an owner too, providing the same notice, and once they didn't reply try to sell the thing. Just curious as to whether that's legal. 'Cause, you know, that's probably important and all.
I have not done any of these but I think you have to satisfy the lien out of the proceeds of the sale.
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