Liability with untransferred car title
August 24, 2013 12:47 PM   Subscribe

Can my parents be held liable for a car that they sold but still hold the title on due to buyer negligence?

My parents sold an older car about a year ago in North Carolina. The buyer paid cash, and they signed over the title and got it notarized. My parents kept a copy of the transferred title for themselves. Yesterday they heard from the mother of the girl who bought the car, who told them that the girl never completed the title transfer by taking it to the DMV. It's unclear whether the car is currently insured or registered. My parent's are concerned that since the car title is presumably still in their name, they could be liable if the girl who bought it gets in an accident and damages someone else's car (or worse). The girl isn't responding to phone calls.

What should be done at this point? Are my parents at risk if the girl does not transfer the title? I mean, they can't force her to...
posted by btkuhn to Law & Government (4 answers total)
 
Typically the DMV has a form you fill out to surrender your rights to the car.

This happened to me when a guy I sold a vespa to for some parking tickets; he didn't register the vehicle in his name, but I had filled out the surrender form. The tickets got sent to me, I photocopied the surrender form and the ticket and mailed it back to the city (2 states away) with an explanation. Never heard a peep after that.

Your DMV should have a protocol in place for this; it's very common.
posted by furnace.heart at 12:58 PM on August 24, 2013 [1 favorite]


I'm not a lawyer, but I've sold and bought lots of used cars. My understanding has always been that once you sign over the title, it is no longer your car. Your parents' copy of the signed over title is proof that they no longer own the vehicle. I hope they also have a bill of sale?

Looks like your parents did things correctly (from a cursory glance at the NC DMV.com used car sales site). I assume they also surrendered the plates at a DMV office and notified the DMV of the sale? If so, I really wouldn't worry about it. However, it sounds like they ARE worried, so my suggestion on next steps would be 1) call the DMV for assistance and 2) calling your car insurance provider.

Why did the car buyer's mother call your parents? That sounds like a strange thing to do.
posted by arnicae at 1:01 PM on August 24, 2013


If she gets a red-light ticket, it will go to your parents. That's what happened to me. Thankfully it wasn't horrible but I had to :
) file a notice of sale with my state's DMV
and
2) take time off to go to court and have the ticket dismissed! (and get a scolding from the judge.)

I learned my lesson and last time I sold a car, I filed the notice of sale as soon as the buyer left my driveway.
posted by vespabelle at 4:33 PM on August 24, 2013


I'm not a lawyer, but I've sold and bought lots of used cars. My understanding has always been that once you sign over the title, it is no longer your car. Your parents' copy of the signed over title is proof that they no longer own the vehicle. I hope they also have a bill of sale?

Obviously, this depends on the state, since things vary wildly. But yes, it is also my understanding that the sale officially happens when the title is signed and the car is exchanged for money. The buyer is then on the hook for transferring the title. So having a copy of the signed and dated title should be all that is required to disprove ownership. Or at least to start the process.

Also, a least in my state, a bill of sale is virtually meaningless in private party transactions. The signed title is what conveys ownership, and there is some formula that doesn't take into account the selling price for determining the value for taxation purposes.
posted by gjc at 8:09 PM on August 24, 2013


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