AUTOMOBILE SALVAGE TITLE

       A salvage vehicle is a automobile that has been declared a total loss from fire, vandalism, collision, theft or flood. The Georgia Department of Motor Vehicle explains:

"When an insurance company retains the salvaged/wrecked vehicle in settlement of a "total loss" claim, the insurance company must apply for a Salvage title in their name within thirty- (30) days of the date of the insurance settlement when the vehicle requires a Georgia title. Click here to see if the vehicle requires a title. To apply for a salvage title, the insurance company should submit the following to this Department's Salvage Unit together." www.dmvs.ga.gov/motor/titles/SalvageVehicleRetainedbytheInsuranceCompany.asp

Sometimes notwithstanding that designation, the vehicle may be purchased from an insurer, repaired, and then resold.  The title should bear the words salvage title, but that fact is sometimes concealed, with the purchaser learning that he has overpaid for a car with limited value and potential future problems.   A purchaser of a vehicle with a salvage title which was not disclosed may have various claims.

    Claims Against the Used Car Dealer

        He may first have a claim for violation of the New Jersey Consumer Fraud Act, N.J.S.A. 56:8-2.  That law prohibits misrepresentation or knowing concealment of a material fact.  Secondly the Uniform Commercial Code provides for an implied warranty that goods are reasonably fit.  Unless the vehicle was sold as-is, that implied warranty may be violated.  Thirdly, other federal and state disclosure laws may be impacted such as the used car lemon law, FTC disclosure rules and others. See Used car fraud and lemon law claims

         Secondly, there are potential claim against other in the chain of title.  The insurance company may have failed to properly label  the vehicle.

       We offer a free consultation on New Jersey and New York salvage title claims. 

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ADDITIONAL RESOURCES

1. NEW JERSEY STATE STATUTE

3. NEW JERSEY DIVISION OF MOTOR VEHICLE GUIDELINES ON SALVAGE VEHICLE APPLICATIONS
http://www.state.nj.us/mvc/forms/mvc_forms.html

Motor Vehicle Commission 
SALVAGE VEHICLE INFORMATION A. WHAT TO DO AFTER A SALVAGE TITLE IS ISSUED
1. Take color photos before and after repairs. These photos must include:
a.
b.
A photo of the entire front and left side of the vehicle (one before and one after).
A photo showing the entire rear and right side of the vehicle (one before and one after).
A total of four photos should be taken -two before and two after. (In color, clear, well lit showing all 4
NOTE: If repairs were started before pictures could be taken, a damage report from your insurance company
will suffice. This report can be substituted for the BEFORE photos.
2. Obtain a bill of sale for each major component part used in the reconstruction, rebuilding or repair of
your vehicle.
The bill of sale must include:
a. Name and address of the buyer;
b. Name and address of the seller; and
c. The date and purchase price of the part.
If new parts are used, a description of the part and part number must be included on the bill of sale.
If used parts are used, the bill of sale must include:
a. Description of the part;
b. The vehicle identification number (if not available, a statement from the seller as to why it is
not available), make, model and year of the motor vehicle from which the part was removed.
c. Date the part was dismantled or removed (if available); and
d. The name and address of the person or business which dismantled or removed the part.
NOTE: When used parts are used, the listing on this form must be completed with the full correct vehicle
identification number of the motor vehicle from which the parts were removed.
Major component parts are defined as:
a. Engine
b. Transmission or Transaxle
c. Front Bumper j. Roof (including T-Tops)
d. Rear Bumper k. Cowl
e. Each Fender I. Frame
f. Hood or Engine Cover m. Shock Tower or Apron
g. Each Door
Assembled items:
1. Nose (fenders, hood, bumper, radiator support)
2. Front clip (cowl, frame section, shock and apron structure)
3. Rear clip (rear sheet metal, frame section, roof)
4. Short clip (rear clip without roof)
h. Each Quarter Panel
i. Decklid, Tailgate or Hatchback (whichever is present),...

To arrange for an appointment, contact one of the salvage inspection sites at the phone number listed
on the OS-3 “Notice of Appointment for Vehicle Identification.” Also, FAX your New Jersey
Salvage Title for the vehicle noted on your inspection application and the salvage appointment
application (OS-3) to that site. If used parts are used, complete the section below and fax to
the site with the salvage title and application (ISM/SS-3).
An appointment will be arranged at a time as convenient as possible for you. However, once an
appointment is scheduled, you must make every effort to keep the appointment and be on time.
Failure to appear for your scheduled appointment will result in forfeiture of your inspection fee, unless
you request a new appointment five working days before the original appointment date. If you are
late for your scheduled appointment, you also forfeit the inspection fee and must reapply. Inspection
fees are non-refundable.
WHAT TO BRING TO THE INSPECTION
1. The salvage title issued in your name;
2. Your copy of form OS-3 attached to the unopened pink envelope:
3. Bills of sale for each major component part used;
4. Before and after color photos; and,
5. Work order.
IMPORTANT INSPECTION REMINDERS - PLEASE READ
The inspection will take approximately ONE hour.You MAY NOT observe the inspection. Inspection facilities do not have comfortable waiting areas.
1. Engine
2. Transmission
3. Frame
4. LF Fender
5. RF Fender
6. Hood
7. LF Door
8. RF Door
9. LR Door
10. RR Door
11. Fr Bumper
12. R Bumper
13. L Quarter Panel
14. R Quarter Panel
15. Decklid. Tailgate/Hatchback
16. Cargo Box/ Pickup Bed
17. Cab of Truck
18. Body-Car
19. Air Bags
20. Misc
Component Parts Vehicle Identification Number
Back of OS/SS-4
B.
SALVAGE PHOTOS
Before and After Color Photos must show all four sides completely. The pictures below are
correct except for Picture D. Notice that the rear bumper is cut off. This picture would be
unacceptable. Vehicle must be free of debris and snow.
A B C D
You can do your pictures in two shots, but must show two complete
sides in each picture. Pictures E & F are acceptable. The front driver side is cut off in
Picture G, so it would be rejected.
E F G
Polaroid Photos are acceptable, however all photos must be legible. If your picture is
blurred, take another one. Pictures must be the size of a standard snapshot or larger.
Pictures smaller that a standard Polaroid are not acceptable. (Approx 2 ¼ x 4 ¼ inches)
If you do not have before photos, try and contact where you bought the vehicle. If they can
not supply you with acceptable pictures, a Property Damage Report, available from the
Insurance Company who sold the vehicle as Salvage, is required.
Photo Quality Paper is Recommended!
Any questions, PLEASE feel free to contact the Site Supervisor where your Salvage
Inspection is done.
Asbury Park 732-869-8333
Morristown 973 631 6576
Winslow 609 567 0190

4.   STATE OF NEW YORK OPINIONS    

STATE OF NEW YORK
INSURANCE DEPARTMENT
25 BEAVER STREET
NEW YORK, NEW YORK 10004

The Office of General Counsel has issued the following informal opinion on February 16, 2000 representing the position of the New York State Insurance Department.

May an insurer take possession of and title to a vehicle which it declared to be a total loss where the cost to repair was less than 75% of the vehicle's cash value without obtaining a "REBUILT SALVAGE" branded title or does it have to forward the title to the Department of Motor Vehicles ("DMV") for processing and branding?

The Insurance Department's Regulation in this area (N.Y. Comp. Codes R. & Regs. tit. 11, §216.7(b)(16)(1999)) does not apply to the situation described in the fact pattern. However, the insurer must forward the title to DMV for processing and branding. It was suggested that the party refer the question to the New York State Department of Motor Vehicles, Title Services Bureau, Empire State Plaza, Albany, N.Y. 12228, which is responsible for processing and branding titles.

An insured had a 1999 Saab automobile with an actual cash value of $28,000. The vehicle received damage in a collision totaling $16,800 (60% of the vehicle's cash value). The insurer chose to consider the vehicle a total loss. It retained the vehicle and its title and paid the insured to settle the claim.

The subject party is concerned that the insurer may sell the totaled vehicle at a higher price with a clean title after having rebuilt it.

N.Y. Comp. Codes R. Regs. tit. 11, §216.7(b)(16) concerns salvage vehicle branding and applies to losses where the cost to repair the damaged vehicle exceeds 75% of the vehicle's actual cash value. Since in this example, the cost to repair was less (60%), Section 216.7(b)(16) does not apply. Last year, DMV promulgated an amendment to its Regulation in N.Y. Comp. Codes R. & Regs. tit. 15, §20.20 (1999), setting forth three situations in which title to a damaged vehicle must be branded "REBUILT SALVAGE". One situation provides that title must be branded where there is a total loss. The insurer is required to notify DMV when there is a total loss and the insurer would file a salvage certificate (form MV-907A).

According to DMV's Regulatory Impact Statement, as published on page 16 of the December 9, 1998 edition of New York State Register, the legislative objective of those N.Y. Vehicle and Traffic Law statutes and concomitant DMV regulations that concern titles of motor vehicles is that such titles must contain full and accurate information about the status and condition of the vehicle. By requiring the transferor to disclose if a vehicle has been severely damaged and is rebuilt salvage, the prospective purchaser would have important information to consider about the value of the vehicle offered for sale.

For further information you may contact Associate Attorney Jeffrey A. Stonehill at the New York City office

keywords, salvage title, automobile salvage title, disclosure, body damage.-