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Committee advances bill to simplify lien process for abandoned vehicles and other property
Summary
Senate Bill 373 would ease how repair shops and dealers use adjuster's liens and seek court orders to dispose of abandoned vehicles; proponents said the current process is costly and slows small-business operations, while insurers and other stakeholders asked clarifying questions about notice and service.
The Senate Business and Labor Committee advanced Senate Bill 373 after testimony from dealers, industry counsel and franchise representatives who said the current adjuster’s-lien process is costly and impractical for many low-value abandoned vehicles.
Bruce Knudson of the Montana Auto Dealers Association called SB 373 “a cleanup bill” intended to make it easier for dealers and repair shops to resolve abandoned or unclaimed vehicles that occupy lot space and create operational burdens. Craig Charlton, an attorney with Smith Law Firm who serves as general counsel for the Montana Auto Dealers Association, told the committee the bill revises Mont. Code Ann. 71-3-1203 (commonly called the adjuster’s lien law) and proposes three principal changes: allow actions under the statute to be filed in any court of competent jurisdiction (for example small-claims or justice courts), clarify the clerk-of-court’s role in issuing show-cause notices and streamline how defendants are served for show-cause hearings.
“An adjuster’s lien can be filed by any person that provides work, labor, service, or feed and is not paid for that,” Charlton said, and added that shifting smaller claims out of district court “probably helps clean up court dockets.” Dealer witnesses described yard space and handling costs tied up for months or years by abandoned vehicles with low residual value; one dealer said his lot currently holds multiple vehicles left for four or five years, with disposal costs often exceeding the vehicle’s resale value.
Proponents said the bill will let dealers pursue lower-cost processes in local courts rather than bringing small-dollar claims to district court, and will standardize how show-cause hearings are noticed and served. Craig Charlton explained the amendments clarify that notice of the show-cause hearing may be sent by certified and first-class mail and that clerks should be given a clear instruction set for issuing show-cause notices.
Committee members pressed about the safeguards for vehicle owners, service estimates and title procedures. Craig Charlton and dealer witnesses said shops commonly give good-faith estimates and sometimes require deposits, but abandoned property can still occur when vehicles fail to run or owners stop responding. Charlton explained that once a judge issues an order after a show-cause hearing the sheriff can issue a certificate or directive to DMV to issue title to the successful claimant.
The committee moved the bill forward; proponents urged a “do-pass.”
