CCUL-backed bill on sale of repossessed vehicles sent to governor

SACRAMENTO, Calif. - The California legislature has passed and sent to Gov. Gray Davis a bill sponsored by the California Credit Union League that resolves uncertainties concerning notice requirements that financial institutions must meet when they intend to sell a repossessed vehicle. In a 70-0 vote earlier this month, the state Assembly agreed on amendments that the Senate had made to A.B. 2051. The Senate unanimously passed the bill June 29 following approval of the legislation in its original form by the Assembly in a 73-0 vote May 15. Until now, state law required all financials to conduct sales of repossessed cars "in a commercially reasonable manner," but it left the specific method of sale to the discretion of the financial. It provided though that sales be either public or private. Two of the most popular "commercially reasonable" methods of selling repossessed vehicles are sales through a dealer and through a newspaper ad. But based on the wording of the current state law, it is unclear whether these sales are public or private. A.B. 2051 amends the state Uniform Commercial code to add two common examples of sales and provides a specific alternate form of notice applicable to those sales. Financials can use the "model language" notice forms in the bill when crafting their notice requirements for the sales.