Bill 498

                    Current Status

Bill Number:               498
Ratification Number:       289
Act Number                 190
Introducing Body:          Senate
Subject:                   Relating to sale of drifted objects

(A190, R289, S498)

AN ACT TO AMEND SECTION 49-1-50, CODE OF LAWS OF SOUTH CAROLINA, 1976, RELATING TO SALE OF DRIFTED OBJECTS, SO AS TO DELETE PROVISIONS RELATING TO WATERCRAFT; TO AMEND SECTIONS 50-23-10, 50-23-30, 50-23-60, 50-23-110, 50-23-120, 50-23-170, 50-23-190, 50-23-200, 50-23-205, 50-23-270, AND 50-23-280, RELATING TO TITLING OF WATERCRAFT AND OUTBOARD MOTORS, SO AS TO DELETE BOATS AND OTHER WATERCRAFT FROM PROVISIONS REGULATING MATERIALS FOUND DRIFTING, TO CHANGE AND ADD DEFINITIONS, TO EXEMPT COMMERCIAL BARGES, WINDSURFERS, AND WATERCRAFT PROPELLED EXCLUSIVELY BY HUMAN POWER OR WITH OARS, PADDLES, OR SIMILAR DEVICES FROM TITLING REQUIREMENTS, TO CHANGE PROCEDURES FOR APPLYING FOR A TITLE CERTIFICATE, TO PROVIDE FOR APPLICATION FOR DUPLICATE CERTIFICATES, TO PROVIDE A LATE FEE, TO PROVIDE FOR THE FORM OF THE MANUFACTURER'S OR IMPORTER'S CERTIFICATE, TO DEFINE "HOMEMADE WATERCRAFT OR OUTBOARD MOTOR", TO CHANGE PROVISIONS RELATING TO SERIAL NUMBERS AND IDENTIFICATION NUMBERS, TO ESTABLISH ACTS WHICH ARE UNLAWFUL RELATING TO WATERCRAFT OR OUTBOARD MOTORS, TO PROVIDE THAT IT IS UNLAWFUL TO DEAL WITH A WATERCRAFT OR OUTBOARD MOTOR BY A PERSON WHO HAS REASON TO BELIEVE IT IS STOLEN, TO PROVIDE FOR DISPOSAL OF STOLEN, ABANDONED, JUNKED, ADRIFT, DESTROYED, OR SALVAGED WATERCRAFT OR OUTBOARD MOTORS, AND TO INCREASE PENALTIES FOR VIOLATIONS; TO AMEND THE 1976 CODE BY ADDING SECTIONS 50-23-24, 50-23-135, 50-23-185, 50-23-275, AND 50-23-290 SO AS TO PROVIDE FOR TITLING ABANDONED, JUNKED, ADRIFT, AND SALVAGED WATERCRAFT OR OUTBOARD MOTORS, TO PROVIDE FOR THE INSPECTION OF FACILITIES INVOLVED WITH WATERCRAFT AND OUTBOARD MOTORS, TO REQUIRE TITLING OF WATERCRAFT OR OUTBOARD MOTORS NOT PREVIOUSLY TITLED, AND TO PROVIDE FOR CONDITIONAL TITLES; TO PROHIBIT BOATS OWNED BY BOAT LIVERIES TO LEAVE THEIR PREMISES UNLESS PROPERLY REGISTERED, NUMBERED, AND TITLED.

Be it enacted by the General Assembly of the State of South Carolina:

Definition of vessel

SECTION 1. Section 50-23-10(a) of the 1976 Code is amended to read:

"(a) 'Vessel' means every description of watercraft other than seaplane used or capable of being used as a means of transportation on water."

Definition of marine dealer

SECTION 2. Section 50-23-10(i) of the 1976 Code is amended to read:

"(i) 'Marine dealer' means a person who engages primarily or secondarily in the business of buying, selling, exchanging, or servicing watercraft or outboard motors new or used on outright or conditional sale, bailment, lease, chattel mortgage, or otherwise, and who has an established place of business for the sale, trade, and display of such watercraft or outboard motors, or both. A marine dealer shall have a proper business license for each facility not under the same roof and shall sell a minimum of twenty watercraft or outboard motors each calendar year to renew his permit. Exclusions must be for sale at organized marine dealer association boat shows. Each dealer shall make application to the department annually for a dealer's permit with a fee of ten dollars for each facility on forms prescribed by the department. A permit is valid for the calendar year and must be displayed in a prominent place for public view. Renewal applications must be received by December fifteenth each year. Permitted marine dealers are eligible for demonstration numbers. A marine dealer licensed under this section shall consent to public or random inspections of his or its business as provided in Section 50-23-185. A dealer refusing the inspections forfeits his license immediately and permanently."

Definition of "marina", "boat livery", "dealer's permit"

SECTION 3. Section 50-23-10 of the 1976 Code is amended by adding:

"(j) 'Marina' means a facility which provides mooring or dry storage for watercraft on a leased or rental basis.

(k) 'Boat livery' means a business which holds a vessel for renting, leasing, or chartering.

(l) 'Dealer's permit' means a certificate issued by the department to recognize a properly licensed marine business and to extend the privilege of using dealer registration numbers on boats for demonstration purposes and assignment on appropriate documents. Any abuse of these privileges may result in termination of the dealer's permit."

Regulation of boat liveries

SECTION 4. The 1976 Code is amended by adding:

"Section 50-23-24. Neither the owner of a boat livery nor his agent or employees may permit any of his vessels to depart from his premises unless it is registered properly, numbered, and titled."

Exemptions

SECTION 5. Section 50-23-30 of the 1976 Code is amended to read:

"Section 50-23-30. The provisions of this chapter do not apply to any watercraft which has a valid marine document issued by the Bureau of Customs of the United States Government or a federal agency successor, commercial barges, windsurfers, and watercraft that are propelled exclusively by human power with oars, paddles, or similar devices."

Application for titling by dealers

SECTION 6. Section 50-23-60(b) of the 1976 Code is amended to read:

"(b) Every dealer selling or exchanging a watercraft or outboard motor subject to titling under this chapter shall make application to the department for a new title in the name of the purchaser before delivering the watercraft or outboard motor to the purchaser. The application must contain the name and address of any lienholder holding a security interest created or reserved at the time of sale and the date of his security agreement. It must be signed by the dealer showing the assigned dealer identification numbers, as well as by the owner, and the dealer shall mail or deliver the application to the department within twenty days of the sale."

Late penalty

SECTION 7. Section 50-23-60 of the 1976 Code is amended by adding:

"(e) An application except those from marine dealers presented after twenty days is subject to a late penalty of ten dollars for the twenty-first day through the thirtieth day and fifteen dollars for the thirty-first day and thereafter."

Manufacturer's or importer's certificate

SECTION 8. Section 50-23-110(c) of the 1976 Code is amended to read:

"(c) The manufacturer's or importer's certificate must be a uniform or standardized form prescribed by the division and must contain:

(1) a description of watercraft or outboard motor, including its trade name, if any, year of manufacture, series or model, body type, and manufacturer's serial number, length, construction, or horsepower;

(2) certification of date of transfer of watercraft or outboard motor, and name and address of transferee;

(3) certification that this was a transfer of watercraft or outboard motor in ordinary trade and commerce;

(4) the signature and address of a representative of the transferor;

(5) on the reverse side of each manufacturer's or importer's certificate an assignment form, including the name and address of the transferee, a certification that the watercraft or outboard motor is new, and a warranty that the title at the time of delivery is subject only to liens and encumbrances set forth and described in full in the assignment."

Duplicate titles - delivery of assignment and warranty

SECTION 9. Section 50-23-120(a) of the 1976 Code is amended to read:

"(a) The owner at the time of delivery of the watercraft or outboard motor shall execute the assignment and warranty of title to the transferee in the space provided on the back of the certificate of title. In the event the title is voided, due to a change, cancellation of an assignment on a title due to error, or failure of a purchase to materialize the owner shall make application for a duplicate title within five days."

Notice of possession of abandoned, junked, or similar watercraft

SECTION 10. The 1976 Code is amended by adding:

"Section 50-23-135. (A) A person who comes into possession of an abandoned, junked, adrift, destroyed, or salvaged watercraft or outboard motor shall notify the department in writing of possession within ten days of acquiring possession. No person in possession may acquire any right of ownership or sell a watercraft or outboard motor under this chapter without first obtaining a title. If a security interest has been perfected, the person in possession shall notify the lienholder by certified mail, return receipt requested, giving thirty days for response. The person in possession who lays claim to a watercraft or outboard motor is required to submit an affidavit to the department setting forth the circumstances under which he came into possession of the watercraft or outboard motor and such information as the department requires.

An owner who abandons or junks a watercraft or outboard motor, either on the land or waters of the State, shall notify the department immediately in writing and deliver to it any title or, if the title is lost or destroyed, a sworn statement of that fact within ten days of the abandonment.

A person in possession of an abandoned or junked watercraft or outboard motor:

(1) whose owner of record has complied with this subsection may make application to the department on forms prescribed by the department for titles and transfer of ownership and after satisfying any security interest, if any, and proof of payment of taxes a title must be issued to the person;

(2) whose owner of record has not complied with this subsection shall contact the owner to get proper titles, duplicate title application, and bills of sale as necessary to transfer ownership after satisfying any security interest. The person in possession shall make application to the department within twenty days with appropriate documents;

(3) whose owner failed to comply with this subsection and cannot be located shall send a certified letter, return receipt requested, to the owner's last known address, and advertise three times, seven days apart, in a newspaper of local circulation in the county where the watercraft or outboard motor was found giving a description including the make, model, length or horsepower, and year. The application for title must be accompanied by the newspaper certification of the advertisement and the dates printed, copies of the advertisement, and certified letter;

(4) who does not desire to sell or obtain ownership may forfeit the watercraft or outboard motor to the department which may sell it at any department public auction or destroy it after every reasonable effort to locate the owner.

(B) A person finding a watercraft or outboard motor submerged, a watercraft, or watercraft with an outboard motor that is adrift on the waters of the State or one that has drifted onto land, and salvages the watercraft or outboard motor from the waters of the State, shall comply with subsection (A) to determine the owner giving the serial number, make, year, model, length or horsepower, or hull identification number, serial number, or registration number.

(1) If the owner of record is located, the person in possession of the watercraft or outboard motor shall notify the owner by certified mail, return receipt requested, advising of the reasonable cost of securing, storage, or salvage, and the time limit for response from the date received or presented. Any person who secures, stores, or salvages a watercraft or outboard motor shall acquire a lien against the watercraft or outboard motor senior to an existing lienholder. However, this does not apply to the department for a violation of this chapter. If the owner does not respond, the person in possession may apply for a duplicate title on a form provided by the department with his lien shown and advertise the watercraft or outboard motor for sale at public auction three times, seven days apart in a paper of local circulation giving the make, year, model, length, or horsepower. The seller shall deduct his reasonable expenses and, after the satisfaction of any other lien, pay any proceeds to the owner upon application.

(2) If the person in possession of the watercraft or outboard motor desires the watercraft or outboard motor for personal use he shall notify the owner of record and all lienholders by certified mail, return receipt requested, with a time of response of thirty days from receipt of the letter. If the owner does not respond, the person in possession may make application on a form prescribed by the department. A title obtained pursuant to this subparagraph is subject to any lien of record previously listed on the watercraft or motor.

(C) A person in possession of an abandoned, junked, drifted, or salvaged watercraft or outboard motor who fails to comply with this section is guilty of a misdemeanor and subject to penalties prescribed by Section 50-23-280(a)."

Manufacturer's serial numbers

SECTION 11. Section 50-23-170 is amended to read:

"Section 50-23-170. (a) If a watercraft contains a permanent identification number placed on it by the manufacturer, the manufacturer's serial number must be used as the builder's hull number. If there is no manufacturer's serial number, or if the manufacturer's serial number has been removed or obliterated, or if the watercraft is homemade, the department, upon application, shall assign a permanent identification number which must be used as the builder's hull number for the watercraft, and this assigned number must be affixed permanently to or imprinted by the applicant, at the place and in the manner designated by the department, upon the watercraft for which the builder's hull number is assigned.

'Homemade watercraft or outboard motor' means any watercraft or outboard motor which is built by an individual for personal use from raw materials which does not require the assignment of a federal hull identification number or serial number by a manufacturer pursuant to federal law. An individual may build or furnish raw materials to a builder under a contract to build a homemade watercraft or outboard motor to desired specifications. A copy of the contract, specifications, and bill of sale for raw materials must accompany registration and title application. The person furnishing materials under a contract may be considered the builder. A rebuilt or reconstituted watercraft or outboard motor in no event may be construed to be homemade. Every homemade watercraft must be certified as meeting safety standards of the United States Coast Guard before it can be sold by the builder. Certification must be furnished to the purchaser and a copy accompany applications for transfer to the department.

(b) Every outboard motor must have a permanent identification number placed on it in at least two locations by the manufacturer. This number must be used as the serial number. If there is no manufacturer's serial number, or if the manufacturer's serial number has been removed for a valid reason or obliterated, the department, upon a prescribed application, may assign a serial number for the outboard motor, and this assigned serial number must be affixed permanently to or imprinted by the applicant, at the place and in the manner designated by the department, upon the outboard motor for which such serial number is assigned.

(c) No newly manufactured watercraft or outboard motor may be sold or offered for sale by any person in this State unless the watercraft or outboard motor has a hull identification number or serial number permanently affixed and the number also must be affixed permanently in a hidden place.

(d) Manufacturer's serial numbers for watercraft must be clearly imprinted in the stern transom knee or other essential hull member near the stern by stamping, impressing, or marking with pressure, or in the case of inboard watercraft on the main inside beam. In lieu of imprinting, the manufacturer's serial number may be displayed on a plate in a permanent manner. In addition to being permanent, the number must be accessible. If the serial number is displayed in a location other than on or near the stern transom, the department must be notified by the manufacturer as to the location.

(e) No person may destroy, remove, alter, cover, or deface the manufacturer's serial number, or plate bearing such serial number, or any serial number assigned by the department, on any watercraft or outboard motor unless authorized in writing by the department."

Inspection of watercraft related facilities

SECTION 12. The 1976 Code is amended by adding:

"Section 50-23-185. Any law enforcement officer may inspect a junkyard, scrap metal processing facility, salvage yard, marina, repair shop, boat yard, dry dock, licensed business buying, selling, displaying, trading watercraft or outboard motors, new and used or parts of watercraft and outboard motors, or both, parking lots, and public garages or any other person dealing with salvaged watercraft or outboard motors or parts of them.

The physical inspection must be conducted while an employee or owner is present and must be for the purpose of locating stolen watercraft or outboard motors, investigating the titling or registration of watercraft or outboard motors wrecked or dismantled."

Regulation of operation or use of watercraft

SECTION 13. Section 50-23-190 of the 1976 Code is amended to read:

"Section 50-23-190. No person may:

(a) operate in this State a watercraft, or an outboard motor, for which a certificate of title is required unless a certificate of title has been issued to the owner;

(b) operate in this State a watercraft, or an outboard motor, for which a certificate of title is required upon which the certificate of title has been canceled;

(c) sell, transfer, or otherwise dispose of a watercraft, or an outboard motor, without delivering to the purchaser or transferee a certificate of title, or a manufacturer's or importer's certificate, assigned to the purchaser or transferee as required by this chapter; or

(d) fail to surrender to the department a certificate of title upon cancellation of the title by the department for a valid reason set forth in this chapter or regulations adopted pursuant to it;

(e) dispose of a rejected or defective watercraft hull or outboard motor in the manufacturing process except by upgrading the hull to meet United States Coast Guard requirements or destroying the hull or outboard motor."

Prohibited cuts

SECTION 14. Section 50-23-200(e) and (f) of the 1976 Code are amended to read:

"(e) Have possession of, buy, receive, sell or offer for sale, or otherwise dispose of a watercraft, or an outboard motor, knowing or having reason to believe that the watercraft or outboard motor has been stolen; and no person may procure or attempt to procure a certificate of title to a watercraft, or an outboard motor, or pass or attempt to pass a certificate of title or any assignment to a watercraft, or an outboard motor, knowing or having reason to believe that the watercraft, or the outboard motor has been stolen; (f) Have possession of, buy, receive, sell or offer for sale, or otherwise dispose of in this State a watercraft, or an outboard motor, on which a manufacturer's or assigned serial number has been destroyed, removed, covered, altered, or defaced, knowing or having reason to believe of the destruction, removal, covering, alteration, or defacement of the manufacturer's or assigned serial number; or".

Seizure of certain watercraft - disposal of

SECTION 15. Section 50-23-205 of the 1976 Code is amended to read:

"Section 50-23-205. A stolen or abandoned, junked, adrift, destroyed, or salvaged watercraft or outboard motor, a watercraft or outboard motor for which the true owner may not be determined, or a watercraft or outboard motor on which the manufacturer's or assigned serial number has been destroyed, removed, covered, altered, or defaced may be seized.

Upon seizure of the watercraft or outboard motor, the department shall notify a person claiming an interest in it, and the person has the right to prove his interest before the circuit court in the county where the property was located. If no action is filed within sixty days of notification, the department may retain the property for official use or transfer the property to another public entity for official use, sell the property at public auction or, in the event that the watercraft or outboard motor is determined to be unsafe, destroy it. The proceeds derived from the sale must be deposited in the Boating Operating Fund of the department for administration of the program."

Requirements of chapter

SECTION 16. Section 50-23-270 of the 1976 Code is amended to read:

"Section 50-23-270. A sale, purchase, or transfer of a vessel or outboard motor is subject to the provisions of this chapter. All other owners are required to obtain title certificates at the time their vessel registration becomes due for renewal or execute an affidavit properly notarized that he is the true owner of the vessel or outboard motor. Any person making a false statement in the affidavit is guilty of a misdemeanor and, upon conviction, must be fined not less than one hundred dollars nor more than two hundred dollars or imprisoned for not more than thirty days."

Watercraft not previously titled

SECTION 17. The 1976 Code is amended by adding:

"Section 50-23-275. A watercraft not previously required to be titled for which a title is required by this chapter must be titled at the time of renewal of the registration of the watercraft or transfer of the watercraft whichever occurs first. An owner of such a watercraft must secure a title for the watercraft within three years from the effective date of this section."

Penalties

SECTION 18. Section 50-23-280 of the 1976 Code is amended to read:

"Section 50-23-280. (a) A person violating the provisions of this chapter is guilty of a misdemeanor and, upon conviction, must be fined not less than fifty dollars nor more than two hundred dollars or imprisoned for not less than ten days nor more than thirty days.

(b) A person convicted of violating Section 50-23-200 is guilty of a misdemeanor and, upon conviction, must be fined not less than two hundred dollars nor more than one thousand dollars or imprisoned for not less than thirty days nor more than one year, or both."

Conditional titles

SECTION 19. The 1976 Code is amended by adding:

"Section 50-23-290. (A) If an applicant for a watercraft title or outboard motor title is not able to produce a perfected chain of title from the last owner of record or from the manufacturer, the department may issue to the applicant a conditional title which reflects on the face of it that it is conditional and that it does not warrant ownership against the true owner. The conditional title may not be issued unless the department:

(1) determines that the watercraft or outboard motor has not been reported as stolen in this State as required by this chapter or in another state;

(2) determines that no active liens exist on the watercraft or outboard motor or that the existence of liens is unlikely; and

(3) determines that the last titled owner cannot be found or the probability of finding the owner is remote; or

(4) determines that the necessary paperwork to perfect the title has been lost, stolen, or destroyed and reasonably cannot be found or duplicated.

(B) The applicant shall cause to be published in a newspaper of general circulation in the county where the last titled owner of the watercraft or outboard motor is known to have lived a notice in the following form:

A. TO: (Name of last titled owner) and all persons claiming an interest in (description including make, model, year, horsepower, and hull identification or serial number if available).

Please take notice that (Name of applicant) shall apply to the South Carolina Wildlife and Marine Resources Department for a title to that certain (watercraft or outboard motor) described as follows: (Description including make, model, horsepower, year, and hull identification or serial number if available) no later than ten (10) days from the last publication of this notice. This is the (first, second, or third) of three notices to be published weekly for three weeks. If you wish to claim an interest in this (watercraft/outboard motor) you are advised to contact the South Carolina Wildlife and Marine Resources Department immediately.

B. If there is no record of a previous titled owner or he cannot be determined the notice may be addressed to all persons claiming an interest in the watercraft or outboard motor and published in the county of the applicant's residence for the prescribed period.

C. Upon receipt of proof of publication (Certification from newspaper with copy of advertisement and dates) and having received no claims from interested parties upon determination of the department that the above conditions exist, the department may issue a conditional title to the watercraft or outboard motor upon receipt of payment of appropriate taxes, fees, and application.

D. The conditional nature of the title must be reflected clearly on the face of the title and upon any subsequent titles issued on the watercraft or outboard motor for seven years.

E. A person claiming an interest in the watercraft or outboard motor may bring an action within seven years to set the conditional title aside and for the return of the watercraft or outboard motor. Seven years after issuance of the conditional title it is incontestable and a new nonconditional title may be issued upon application and payment of the appropriate fee."

Drifted lumber or timbers

SECTION 20. Section 49-1-50 of the 1976 Code is amended to read:

"Section 49-1-50. No person may sell any drifted lumber or timber, not the property of the person, without first advertising the sale of it at public auction at least three times and at least three days prior to the date of the sale in the newspaper having the greatest circulation in the county in which the drifted lumber or timber is found and taken, giving an accurate description of any and all marks by which the lumber or timber may be identified.

If a person sells any drifted lumber or timber without having first advertised the sale or fails to pay the proceeds of the sale to the owner on application, after deducting the expenses, or if a person having advertised a sale refuses to deliver any drifted lumber or timber claimed by the rightful owner, prior to the date of the sale after the owner has offered to pay reasonable salvage expenses, he may be indicted for a misdemeanor and fined or imprisoned in the discretion of the court. A person who purchases drifted lumber or timber that has not been advertised as provided may be indicted as a receiver of stolen goods and fined or imprisoned in the discretion of the court."

Time effective

SECTION 21. This act takes effect upon approval by the Governor.