PA 17-104—HB 7243

Judiciary Committee

AN ACT CONCERNING SPECIAL MOBILE EQUIPMENT LIENS

SUMMARY: Subject to certain procedures, existing law allows bailees to sell at auction personal property left in their custody (e.g., left at a repair shop) if the owner does not reclaim it and satisfy the lien. This act creates a specific process for bailees to follow if the property is “special mobile equipment” (i.e., certain types of heavy construction equipment; see BACKGROUND).

Under the act, if the owner or anyone else with a right to the property has not applied to dissolve the lien within 30 days after completion of the work on the property, the bailee must immediately send a written notice to the bailor. The notice must be sent by certified mail, return receipt requested, and indicate the (1) equipment's identification number, (2) date the equipment was left with the bailee, (3) date the work was completed, (4) lien amount, and (5) name of the owner or other person who authorized the work.

The act also requires the bailee to conduct a search for lienholders under the Uniform Commercial Code. If the equipment is subject to a security interest (e.g., a loan), the bailee must notify each lienholder by certified mail, return receipt requested, that the bailee has the equipment and has a lien upon it for repair and storage charges.

Under the act, the general rules for public auctions of property held by bailees continue to apply to special mobile equipment (e.g., procedures for advertising the sale in a newspaper and disbursing the sale proceeds). As under existing law for auctions of motor vehicles, the act requires the bailee to notify any lienholders at least 10 days before the sale, by certified mail, return receipt requested.

If the bailee does not comply with these requirements, the act voids any such sale of the equipment.

EFFECTIVE DATE: October 1, 2017

BACKGROUND

Special Mobile Equipment

By law, “special mobile equipment” is a vehicle that is not designed to transport people or property, and only incidentally moves or operates over a highway. This includes, among other things, ditch-digging and well-boring equipment and many kinds of road construction and maintenance machinery, such as asphalt spreaders, bucket loaders, street sweepers, and leveling graders. The term does not include house trailers; dump trucks; or truck-mounted transit mixers, cranes, and shovels (CGS 14-165).