An Old Pickup Sold
Long Ago Comes Back
To Haunt the Cullens
By Terri Cullen
There are few things I hate to get more than a certified letter -- it's almost always bad news. And so it was last week, when I opened an envelope to find a collection letter from a local car-towing and impound service.
The letter stated that a vehicle of ours, a 1990 F-150 Ford pickup, was impounded April 10, 2006, by the local police department. We do own an F-150 pickup, but it was parked in our driveway. The truck that's sitting in the pound is the F-150 Gerry owned almost a decade ago and sold to a friend of a friend.
The certified letter said we owed the following: "Towing service $45 and storage at $20 per day, plus 7% sales tax for 160 days." That came out to $45 for towing and $10,860 for storage, not to mention $224 in sales tax. Grand total to spring a 17-year-old pickup from impound: $11,129.
The letter warned that if my husband Gerry didn't respond to the collection notice in the next five days, he would be subject to a fine of as much as $500 and his driving privileges might be suspended or revoked for not more than two years.
I figured it was just a simple mix-up, so I called the towing service and spoke to the manager. But he wasn't exactly helpful. The car was impounded by the local police, he said, because it was abandoned and the license plate didn't match up with the car's vehicle identification number. The towing service did a VIN search and my husband's name appeared as the car's most-recent owner, the manager told me.
And then he said something that really worried me: "If the person you sold the truck to didn't retitle it in his name when you sold it to him, your husband is still considered the legal owner of the truck."
I admit I was cowed. Gerry had handled the sale of the car and I wondered if he or the buyer might have skipped a crucial step that could leave us responsible for this mess. And if the buyer didn't bother to retitle the car, maybe he didn't bother to insure it as well. I couldn't bring myself to think about what could have happened if we were legally responsible for a truck being driven around New Jersey uninsured for a decade.
If we had sold the car through a dealership, the paperwork would have been handled for us. But we'd sold the car to an individual, so it was our responsibility to make sure we'd made the transfer properly. Gerry assured me that he'd done everything he was supposed to do under New Jersey rules to legally transfer title of the truck to the buyer.
Each state has different rules regarding proper title transfer; in our state and many others, both the seller and the buyer have paperwork to fill out to ensure the transfer is legal. Per our state's rules, Gerry signed the back of the truck's existing title along with the date, the truck's sale price and the odometer reading before handing it over to the buyer.
Philip Reed, author of the book "Strategies for Smart Car Buyers," says providing an accurate odometer reading is critical when selling a vehicle. Once you sign off on the title, the odometer reading provides proof of the moment in time the car is no longer legally yours. "The key for readers is to actually look at the odometer, don't round it off," he says. "The buyer could go around the corner and have an accident, and claim that you are responsible."
Gerry also gave the buyer a receipt, and asked him to sign off on a letter stating the terms of the sale. Most states recommend that buyers and sellers complete a bill of sale to provide proof of the transfer -- and to protect sellers like us from any future tickets, violations or other problems with the vehicle. (DMV.org, a clearinghouse of motor-vehicle information from all states, provides a sample bill of sale here4.)
We looked over the paperwork from the sale of our truck, which we keep tucked away in our fire box along with purchase and sale documents from every car we've owned. Gerry was right: He'd followed all the rules to transfer the title to the buyer, and we had the bill of sale and the license-plate receipt as proof.
Still, the towing-service manager said that if the buyer hadn't held up his end of the deal and retitled the car in his name, we might be legally responsible. But that's generally not so, according to Keith Kiser, vice president of vehicle programs at the American Association of Motor Vehicle Administrators.
"As long as you can prove you sold the vehicle and everything is properly dated, you shouldn't be legally bound to the failings of someone else," he says.
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