State Codes and Statutes

State Codes and Statutes

Statutes > Delaware > Title25 > C039

TITLE 25

Property

Mortgages and Other Liens

CHAPTER 39. LIENS OF GARAGE OWNERS, LIVERY AND STABLE KEEPERS; REPLEVIN BY OWNER

§ 3901. Persons entitled to liens.

(a) Any hotelkeeper, innkeeper, garage owner, auction service or other person who keeps a livery, boarding stable, garage,
airport, marina or other establishment and, for price or reward at such livery, boarding stable, garage, airport, marina or
other establishment, furnishes food or care for any horse or has the custody or care of any carriage, cart, wagon, sleigh,
motor vehicle, trailer, moped, boat, airplane or other vehicle or any harness, robes or other equipment for the same or makes
repairs, auctions, performs labor upon, furnishes services, supplies or materials for, stores, safekeeps or tows any carriage,
cart, wagon, sleigh, motor vehicle, trailer, moped, boat, airplane or other vehicle or any harness, robes or other equipment
for the same shall have a lien upon such horse, carriage, cart, wagon, sleigh, motor vehicle, trailer, moped, boat, airplane
or other vehicle, harness, robes or equipment and the right to detain the same to secure the payment of such price or reward.

(b) Unless the context of this chapter requires otherwise, a lienholder shall mean any person defined in subsection (a) of
this section.

17 Del. Laws, c. 620, § 1; Code 1915, § 2863; 34 Del. Laws, c. 193; Code 1935, § 3344; 25 Del. C. 1953, § 3901; 61 Del. Laws, c. 367, § 1; 68 Del. Laws, c. 62, §§ 1, 2.;

§ 3902. Lienholder's loss of possession.

In case, either before or after the price or reward become due and payable, the lienholder under § 3901 of this title loses
possession of the encumbered property, except by court order pursuant to this chapter, the lienholder's lien shall continue
in full force and effect, provided that within 10 days from the time of the loss of possession the lienholder pursuant to
§ 3903 of this title files an application for the issuance of an authorization to conduct a lien sale or files a counterclaim
for the sale of the encumbered property pursuant to this chapter in a replevin action brought pursuant to Chapter 95 of Title
10 by the owners or other persons claiming an interest in the property.

17 Del. Laws, c. 620, § 1; Code 1915, § 2863; 34 Del. Laws, c. 193; Code 1935, § 3344; 25 Del. C. 1953, § 3901; 61 Del. Laws, c. 367, § 1.;

§ 3903. Sale to satisfy liens.

(a) If a lienholder under § 3901 or § 3902 of this title is not paid the amount due, and for which the lien is given within
30 days after the same or any part thereof became due, then the lienholder may proceed to sell the property, or so much thereof
as may be necessary, to satisfy the lien and costs of sale pursuant to § 3905 of this title if:

(1) An authorization to conduct a lien sale has been issued pursuant to this section;

(2) A judgment has been entered in favor of the lienholder on the claim which gives rise to the lien; or

(3) The owners and any secured parties of record or known lienholders of the property have signed, after the lien has arisen,
a release of any interest in the property in the form prescribed by § 3904 of this title.

(b) A lienholder may apply to a justice of the peace in the county in which the lienholder's business establishment is situated
for the issuance of any authorization to conduct a lien sale under § 3905 of this title. The application shall be executed
under penalty of perjury and shall include all of the following:

(1) A description of the property.

(2) The names and addresses of the owners of the property and the names and addresses of any other persons who the lienholder
knows claim an interest in the property.

(3) A statement of the amount of the lien and facts concerning the claim which gives rise to the lien. If compensation for
storage is claimed, the per diem rate of storage shall be shown.

(4) The date, time and place that the property will be sold if the authorization to conduct a lien sale is issued.

(5) A statement that the lienholder has no information or belief that there is a valid defense to the claim which gives rise
to the lien.

(c) Upon receipt of an application which is made pursuant to subsection (b) of this section, the justice of the peace shall
send a notice and a copy of the application by certified mail or registered mail, return receipt requested, to the owners,
secured parties of record and any known lienholders and any other persons whose names and addresses are listed in the application.
If the identity of the last registered owner or secured party cannot be determined with reasonable certainty, § 3905 of this
title shall have the same effect as notice sent by certified or registered mail. The notice shall include all of the following:

(1) A statement that an application has been made with the justice of the peace for the issuance of an authorization to conduct
a lien sale.

(2) A statement that the person has a legal right to a hearing in court; if a hearing in court is desired, the enclosed declaration
under penalty of perjury must be signed and returned and if the declaration is signed and returned, the lienholder will be
allowed to sell the vehicle only if he obtains a judgment in court or obtains a release from the owners and any known lienholders.

(3) A statement that if the declaration is signed and returned, a hearing will be promptly scheduled and the owners may then
appear to contest the claim of the lienholder.

(4) A statement of the date, time and place that the property will be sold if the authorization to conduct a lien sale is
issued.

(5) A statement that the justice of the peace will issue the authorization to conduct a lien sale unless the person signs
and returns, within 20 days after the date on which the notice was mailed, the enclosed declaration stating that the person
desires to contest the claim which gives rise to the lien.

(6) A statement that the person shall be liable for costs if a judgment is entered in favor of the lienholder on the claim
which gives rise to the lien.

(7) A declaration which may be executed by the person under penalty of perjury stating that he desires to contest the claim
which gives rise to the lien and that he has a valid defense to the claim and he shall furnish names and addresses where official
notice may be received of any person or persons including himself known to claim an interest in the property of the hearing
date.

(d) If the justice of the peace receives a declaration described in paragraph (3) of subsection (c) of this section which
is mailed within 20 days after the date upon which the notice described in subsection (c) of this section is mailed, the justice
of the peace shall notify the lienholder and owners and any other persons listed in the application or declaration of the
hearing date unless the owners of the property and any known lienholder or lienholders have signed, after the lien has arisen,
a release of any interest in the property in the form prescribed by § 3904 of this title. In any other case, the justice of
the peace shall issue an authorization to conduct a lien sale.

(e) In any hearing, the lienholder may have the amount of the indebtedness and right to sale determined and the person requesting
the hearing may present and have determined any defenses, setoffs, counterclaims, cross-claims or third-party actions.

(f) Any fees shall be recoverable as a cost by the lienholder if a sale is conducted.

(g) The form of the applications, notices and declarations described in this section shall be prescribed by the justice of
the peace. The language used in the applications, notices and declarations should be simple and nontechnical.

17 Del. Laws, c. 620, § 1; Code 1915, § 2863; 34 Del. Laws, c. 193; Code 1935, § 3344; 25 Del. C. 1953, § 3901; 61 Del. Laws, c. 367, § 1.;

§ 3904. Release of owner's interest in vehicle or property.

(a) An owner of property subject to a lien under § 3901 or § 3902 of this title may release any interest in the property after
the lien has risen. The release shall be dated when signed and a copy shall be given at the time the release is signed to
the person releasing the interest.

(b) The release shall contain all of the following information in simple, nontechnical language:

(1) A description of the property sufficient to identify it.

(2) The names and addresses of the owners.

(3) A statement of the amount of the lien and the facts concerning the claim which gives rise to the lien.

(4) A statement that the person releasing the interest understands that the person has a legal right to a hearing in court
prior to any sale of the property to satisfy the lien and the person is giving up the right to appear to contest the claim
of the lienholder.

(5) A statement that the person releasing the interest gives up any interest that person may have in the property and the
person is giving the lienholder permission to sell the property.

(6) A statement that there is no other person, persons or lienholders who have an outstanding interest in the property.

61 Del. Laws, c. 367, § 1; 70 Del. Laws, c. 186, § 1.;

§ 3905. Notice of sale; disposition of proceeds.

(a) Prior to any such sale the lienholder shall give at least 15 days' notice of the sale by handbills posted in 5 or more
public places and by advertising in a newspaper published and/or circulated in the county in which the sale is to be held.

(b) The proceeds of the sale shall be applied to the discharge of the lien and the cost of keeping and selling the property.
The balance, if any, of the proceeds of the sale shall be deposited not later than 10 days from the date of the sale with
the court to be applied by the court to the payment of any lien or security interest to which the property may be subject
in the order of their priority, with any remaining proceeds to be paid to the owner or owners of the property sold but, in
case such owner or owners cannot be found, such balance shall be turned over to the State Treasurer not later than 60 days
from the date of the sale who shall create a special fund thereof and who shall pay to the owner the moneys left if a claim
is made within 1 year of the sale, or deposit the moneys in the General Fund if no claim is made within 1 year of the sale.

(c) In every lien sale authorized under this chapter, it shall be the duty of the lienholder to complete and file with the
court a disposition of proceeds form, justice of the peace civil form no. 48, within 10 days from the date of the sale. No
transfer of or new certificate of title to the vehicle sold or salvage certificate shall be issued by the Division of Motor
Vehicles without proof of the filing of said disposition of proceeds form with the court within the required time period.
A copy of the disposition of proceeds form sealed with the court's seal shall constitute sufficient proof of filing.

17 Del. Laws, c. 620, § 1; Code 1915, § 2863; 34 Del. Laws, c. 193; Code 1935, § 3344; 25 Del. C. 1953, § 3901; 61 Del. Laws, c. 367, § 1; 64 Del. Laws, c. 34, §§ 1, 2.;

§ 3906. Motor vehicles.

In the case of motor vehicles required to be registered under the motor vehicle laws of this or any other state, notice containing
the information required in § 3903(b) of this title shall be given to the registered owners and known lienholders at their
addresses of record with the Division of Motor Vehicles or similar agency and the return receipt, signed or unsigned, shall
be held and considered as prima facie evidence of service of such notice. The lienholder shall notify the appropriate Delaware
auto theft unit.

61 Del. Laws, c. 367, § 1.;

§ 3907. Priority of lien.

(a) All liens created pursuant to § 3901 or § 3902 of this title shall be superior to any lien, title or interest of any person
who has a security interest by virtue of a conditional sales contract or a prior perfected security interest in accordance
with Article 9 of Title 6.

(b) Notwithstanding the provisions of subsection (a) of this section, any person who stores or safekeeps any motor vehicle
towed at the request of a party other than the owner of the vehicle may attain priority of lien as follows:

(1) By providing notice by certified mail to a title holder of record within 7 business days of the date upon which possession
is taken;

(2) By providing notice by certified mail to lienholders of record within 7 business days of the date upon which possession
is taken; and

(3) By providing notice by telephone or in person to the appropriate police agency.

61 Del. Laws, c. 367, § 1; 68 Del. Laws, c. 315, § 1.;

§ 3908. Remedy of owner.

The owners or other persons claiming an interest in the property, in addition to the right to a hearing as provided herein,
shall have the right to file an action in replevin at any time in accordance with Chapter 95 of Title 10, and no bond shall
be required to be posted as a prerequisite to the filing of such an action or the issuance of the writ of replevin.

17 Del. Laws, c. 620, § 2; Code 1915, § 2864; 34 Del. Laws, c. 193; Code 1935, § 3345; 25 Del. C. 1953, § 3902; 61 Del. Laws, c. 367, § 1.;

§ 3909. Jurisdiction.

Except where a lienholder's business establishment is located within the city limits of Milford or within 3 miles of said
limits in which case Justice of the Peace Court No. 5 in Milford shall have exclusive jurisdiction, the Justice of the Peace
Court in the county in which the lienholder's business establishment is situated shall have exclusive jurisdiction of all
petitions for sale or replevin under this chapter, notwithstanding any monetary amount which is claimed by the lienholder.

61 Del. Laws, c. 367, § 1; 65 Del. Laws, c. 42, § 1.;

§ 3910. Rules.

The Justice of the Peace Court may adopt appropriate and specific rules to effectuate the intent and purpose of this chapter.

61 Del. Laws, c. 367, § 1.;