Montana Attorney General Opinion 17-103

Opinion No. 103. Motor Vehicles-Certificate of Owner- ship-Rights of Purchaser Upon Repossession. HELD: Where conditional sale ven- dor repossesses automobile and sells the same, the purchaser is entitled to certificate of ownership notwithstand- ing the fact that conditional sale vendee gave a mortgage thereon before repos- session. May 18, 1937. Hon. Theo. R. Bergstrom Registrar of Motor Vehicles Deer Lodge, Montana Dear Mr. Bergstrom: You have requested our opinion as to whether the second purchaser of an automobile is entitled to receive a cer- tificate of ownership thereof from your office, upon the following facts which have been submitted to your office: "The Kincaid Motor Company sold a new 1935 truck to a certain Mr. Mick on a conditional sales contract. The contract was carried in default. The truck was repossessed, affidavit of repossession filed and the truck was then resold to another party. This party upon making application for license and certificate of title was in- formed by your office that you could not issue him a clear title because there was a second mortgage against this truck on file in your office. This second mortgage was given by Mr. Mick, the original purchaser, in favor of H. S. and G. A. Hanson and was filed after the conditional sales con- tract was recorded." Since the mortgagee of the condi- tional sale vendee never was the "legal owner" as defined by Section 1758, R. C. M. 1935. and never became registered as such as provided by this section and Section 1758.3 Id .. it is my opinion, on the facts given, that the second pur- chaser of the automobile (in case the sale was not a conditional one), is entitled to the certificate of ownership, as well as the certificate of registration. Section 1758.3 (a) expressly provides: "No chattel mortgage or conditional sales contract on a motor vehicle shall be valid as against creditors or subse- quent purchasers or encumbrancers 112 OPINIONS OF THE ATTORNEY GENERAL until the mortgage or conditional sales vendor therein named is registered as t~e le~al owner thereof as herein pro- vIded. Moreover, the interest of the mortga- gee of the vendee, if any, was lost when the car was repossessed by the condi- tional sale vendor.