The Storage Lien Requirements

C.R.S. 38-20-116 Abandoned property — notice of sale-definition. (1) Property is presumed to be abandoned if the owner has failed to contact the lienholder for a period of not less than 30 days and the lienholder, in good faith, is without knowledge of any evidence indicating that the owner does not intend to abandon the property. (2) At least 15 days prior to selling or otherwise disposing of abandoned property, the lienholder shall notify the owner of the proposed manner and date of disposition by transmitting said notice to the owner’s last known address by registered or certified mail, return receipt requested, signed by the addressee only. The lienholder shall maintain in his records for a period of one year a copy of said notice together with the return receipt signed by the addressee, or, if said notice is returned unclaimed, said notice and the proof of return unclaimed shall be so maintained. If the written notice is returned unclaimed, the lienholder shall publish said notice at least one day in a newspaper in the county in which the property is located or, if no newspaper is published in that county, then a newspaper in some adjoining county.

When a vehicle is left for storage, under an agreement, the Storage Lien procedure may be started when there has been no contact for a minimum of 30 days.

If the agreement was made with a licensed repair shop (mechanical, body, etc.), the Abandoned Vehicle at a Repair Shop procedure must be completed (see Abandoned Vehicle at Repair Shop).

Examples of abandonment that the Storage Lien procedure covers are as follows:

• A landlord may use this procedure if a tenant abandons a vehicle on the premises if an agreement exists for storage of the vehicle.

• A landowner may have an agreement to let someone park or leave a vehicle on their property until a specific date, and it is abandoned.

All of the above examples have a common point: There was a written or verbal agreement between the parties.

If there was an agreement or contract between the parties, and all the requirements of CRS 38-20-116 cannot be completed, the commencement of foreclosure action CRS 38-20-107 must be followed.

Examples of those who do not have a right to follow the Storage Lien procedure are:

• Public or business parking lots and residential parking. The lot owner or homeowner does not know who left the vehicle and there is neither a verbal nor written agreement for storage.

• If owner was notified and still claims interest in the vehicle, the applicant cannot follow the Storage Lien procedure. The matter must be settled, either with the individual or by court action.

If there is contact between the owner of the vehicle and the person who is holding the vehicle for storage, the Storage procedure cannot be used as the vehicle is not abandoned.

Follow the procedures of CRS 38-20-107 to resolve the problem.

CRS 38-20-107 Commencement of foreclosure action. (1) If any such charges for which a lien is given by section 38-20-102, 38-20-105, 38-20-106 or 38-20-106.2 or for which a lien is restored by section 38-20-106.5, are not paid within 30 days after the same become due and payable, the mechanic, innkeeper, or other person to whom such lien is given may file a foreclosure action in the county or district court of the county or city and county in which the contract or agreement between the lienholder and the owner of the property was signed or entered into, in which the owner resided at the time the contract or agreement was entered into, in which the owner resides at the time the foreclosure action is commenced or in which the work was performed, or, in the case of a lien created pursuant to section 38-20-106.2, in which any work was performed or materials were furnished. In the event that the lienholder does not foreclose the lien by commencing a judicial action within 60 days and if, under section 38-20-106, within 90 days after charges become due and payable, the lien shall terminate. However, such period of limitation may be extended by agreement between the parties for an additional period not to exceed 30 days. For the purpose of this subsection (1), if the contract between the owner and the lienholder provides for installment or continuing payments, installments or continuing payments shall be deemed to be due after default of any installment or payment or at the time the final installment or payment is due and payable at the option of the lienholder. 2) If the lienholder sells or otherwise disposes of the property of the owner without substantially complying with this article, the owner is entitled to recover from the lienholder the value of the property, but in no event less than one hundred dollars, and reasonable attorney’s fees. (3) Nothing in this article shall require a lienholder to commence a judicial action to foreclose his lien if the property held is abandoned as defined in section 38-20-116.

The following steps are required to complete the Storage Lien Procedure:

Out-of-state verifications of Vehicle Identification Numbers will not be accepted for the Storage Lien procedure. The vehicle must be in Colorado during the process.

Newspaper Notice of Sale

If the written notice(s) is returned unclaimed or if the return receipt is signed by a person other than to whom the registered letter was addressed, the applicant must publish a notice for one day in the newspaper in the county in which the vehicle is located. If there is no newspaper in that county, publication may be made in a newspaper in an adjoining county.

The notice must state:

• That the applicant is applying for a title for this vehicle.

• Identify the vehicle by VIN, year and make.

• Name(s) of owner(s) of record and name of the person who made the contract or agreement, if other than the owner of record.

• Phone number or address where you the applicant can be contacted.

Example: Attention John Smith (owner) and Bill Brown (person with whom contract or agreement was), I have your 1975 Ford, VIN number 1234567890. I will proceed to apply for title unless you contact me immediately.

A-OK Auto Repair

123 N. Merry Way

Denver, Colorado 80202

(303) 555-1234

Newspaper Certification of Publication

The certification of publication is obtained from the newspaper agency. There is usually a fee for this service. Publication should be made only after any liens are released. Application for title must be at least 15 days after publication.

Active Liens:

If the title search shows that there is an active lien still in effect, an original lien release or original release of interest from the lienholder must be submitted.

The separate lien release or release of interest must be on company letterhead (not required if individual) and include:

• Vehicle description (year, make and VIN).

• Titled owner’s name(s).

• Agent’s Signature.

• Signed under penalty of perjury in the second degree.

• Date lien released.

Lienholder Not Available

If an attempt is made to secure a lien release and the lienholder is not available, the following procedures should be used:

• A certified or registered letter must be sent to the lienholder’s last known address and be returned as undeliverable. Include this letter with the application.

• A bond must be posted for the amount of the lien or for twice the appraised value of the vehicle, whichever is greater.

Establish the appraised value by either of the following:

• Appraisal from a Licensed Colorado Dealer

  • Any licensed Colorado automobile dealer may give an appraisal. It must:

    • Be on dealer’s letterhead

    • If the Colorado dealer does not have letterhead, they must sign the appraisal under penalty of perjury or it must be notarized.

    • Describe the vehicle by VIN, Year, and Make

    • Be signed and dated by the dealer’s agent

    • State the dealership’s license number

  • If the vehicle is appraised for less than $200, a Salvage Title must be applied for

• Appraisal must be for the current condition of the vehicle at the time of titling.

• Appraised value from a current Kelley Blue Book or N.A.D.A. Official Used Car Guide.

• The specific model being appraised must be identified (i.e., highlighted). Applicant may use the retail value listed in the CURRENT Kelley Blue Book or N.A.D.A. Official Used Car Guide for light truck or passenger vehicles.

Surety Bond

A surety bond for the lien amount or twice the appraised value of the vehicle is required. If the appraisal is showing both the retail and wholesale values, use the greater amount (retail) as the established value. The bond must identify the vehicle by year, make and VIN. This is a one-time non-refundable bond that protects and allows the State of Colorado to issue a title when proper proof of ownership is not provided. Applicants may purchase a surety bond through a surety bonding company or insurance company. The type of bond must be for a Certificate of Title.

• Dealerships establishing title in their name may post a surety bond for twice the wholesale value of the vehicle.

• For manufactured homes surety bond must be for twice the actual value according to the County Assessor’s records.

• The minimum bond acceptable is $400. If bond is lower than $400, a rider bond can be purchased from the bonding company to increase the overall value to the acceptable amount.

• A bond cannot be issued showing DBA, a corrected bond or rider is required showing correct owner.

• The title will be issued in the principal’s name(s) as shown on the surety bond. No changes or additions can be made without a rider.

DR 2438 Mechanic and Storage Lien Bond Statement Guide

A detailed statement from the applicant outlining the reason for bonding to establish title. The statement must be signed, dated by the applicant and include the following information:

• That the applicant has not heard from the person who left the vehicle for over thirty days, and in good faith you believe that person has abandoned the vehicle.

• That the applicant owns a storage business (give business name and address), or why the vehicle was left.

• Description of the vehicle by year, make and VIN.

• Date vehicle was left with the applicant.

• Name of person who left the vehicle with the applicant. Copy of written agreement or if verbal contract, state terms of agreement.

Documents Required for Titling

• DR 2489A Motor Vehicle Record Request (validated copy), and title record search results.

• DR 2704 Colorado Certified VIN Inspection completed by a Colorado certified law enforcement officer.

• Lien release, if applicable.

• Copy of the letter sent to all owners and or person who made the agreement along with a copy of certified mail return receipt properly signed by addressee; or if letter was unclaimed or accepted by someone other than the addressee, then submit a copy of the letter and a copy of the certified mail return receipt showing signature.

• Green card, PS3811 or envelope marked undeliverable. Electronic proof of delivery is acceptable.

• Certified copy of newspaper notice (only if receipt was not properly signed by owner of record).

• Appraisal.

• Surety Bond.

• DR 2438 Mechanic and Storage Lien Bond Statement Guide (signed and dated).

• The applicant taking title for motor vehicles with model year of less than 10 years must disclose the mileage on the DR 2173 Motor Vehicle Bill of Sale. If it is known that the odometer is broken, or the search results indicate “in excess” or “not actual”, the odometer indicator will be “Actual”.

Note: A rider bond may be used to correct any errors or make any changes to the original surety bon