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Can A Towing Company Sell My Car?

In some instances, towing companies are required to perform their duties even with the absence of the vehicle owner. The company is never sure whether the owner will pay their fee to recover their impounded vehicle. Without the proper legal protection, a towing company would have to operate without being compensated for the expenses incurred during towing. To allow towing companies recover their operating costs and expenses, policies were formulated to accord the towing companies rights to sell the impounded vehicles if a certain period is exceeded without the owner making a claim for the vehicle or making the necessary payment.

Right to Sell

Towing companies are obliged to move, store as well as reasonably protect the vehicles they tow, and this often needs a huge amount of time, expenditure, and space. Many towing companies are usually bound by a contract with a city or a law enforcement agency. Under the contract terms, the towing companies must move a vehicle when requested, whether or not the payment for the service is forthcoming. And in order to protect a towing service from incurring a loss on any unclaimed vehicles, most city laws grant them the right to lien on all vehicles towed. This implies that if the owner of the towed vehicle cannot pay or fails to pay towing as well as storage expenses as required, the company can liquidate the vehicle to cater for the expenses incurred all along.

Foreclosing on Lien

A towing company does not just foreclose on a lien without a specific plan. In most cases, the company needs to file a lawsuit with the city courts. And for the suit to be deemed successful, the towing company will need to have sufficient backing for it. To begin with, the company must show full evidence of all attempts to contact the individual to whom the vehicle is registered in a bid to collect payment for the towing services. However, it is equally important to note that the guidelines for reasonable attempts to reach out to the owner and make payment vary from one state to the other. In the state of New Mexico, for instance, a towing company has five days to retrieve all every piece of the vehicle’s registration information and not more than two days to send a confirmation by certified mail the person to whom the vehicle is registered. A towing company that fails to contact or identify the owner of the vehicle within the stipulated timeframes are not permitted to foreclose on any lien.

AuctionsIn other states, a towing company is allowed to take action to sell an impounded vehicle without taking the process through a court of law. Typically, it needs either the county sheriff’s office or towing company to hold the car for one to two weeks while they seek to identify and contact the lien holder or vehicle owner. Contact is usually made via certified mail with a clear notice of the debt and the period given to settle the debt. If payment is not made within the stipulated period, usually ten days the towing company should inform the state police and county sheriff and could start advertising the sale of the vehicle. In some states, there is usually a minimum period for which the vehicle must be advertised, and typically it often is a fortnight to a month. Once the vehicle is placed in an auction, it generally is sold to a cash bidder with the highest offer and the proceeds put towards the costs of towing, including labor and storage. While state laws could vary, in Illinois, $2000 is the maximum amount that can be recovered by a lien.

How About the Personal Property?

If the required towing fees are not paid, all personal property that was in the vehicle at the period of towing could also be subject to a lien. In some states, vehicle owners are allowed to retrieve their personal items from the impounded vehicle during operation hours, unless access to the car is restricted due to a pending investigation. Typically, personal property is usually subject to a lien except for items like cash, food, identifying documents, or medication.

Property in the impounded vehicle that belongs to someone else besides the vehicle owner could be claimed if sufficient proof of ownership is provided to the towing service. And if the vehicle was towed because of an accident, some states allow owners to claim their property in the vehicle when proof of insurance which covers storage and towing fees of the car is submitted to the company.

Deposition of the Proceeds

While most state laws are different, the deposition of all proceeds from the sale of an impounded vehicle typically follows a specific order. All costs incurred and which relate directly to the vehicle’s sale, like advertising, are first settled. The towing service then receives its dues for towing as well as storing the vehicle.


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