By Lisa M. Goolik, J.D.
In accordance with Ohio law, a body shop’s common law artisan lien in a debtor’s motor vehicle was not superior to a competing creditor’s perfected security interest that was noted on the vehicle’s certificate of title. In Citizens Banking Company v. Ott’s Body Shop, 2015 Ohio 906, the Court of Appeals of Ohio has concluded artisan liens related to motor vehicles are expressly exempt from the application of the rules of priority.
Background. In December 2007, the debtor took his 1970 Pontiac GTO to Ott’s Body Shop to have the vintage motor vehicle repaired and restored. In connection with the restoration, Citizens loaned money to the debtor with the vehicle serving as collateral. Ott’s performed various work upon the vehicle for which it invoiced the debtor for approximately $15,000, of which $11,000 remained unpaid.
In July 2011, Citizens’ interest in the vehicle was formally recorded on the vehicle’s certificate of title, thereby perfecting the security interest in the event of competing order of priority disputes. The debtor ultimately breached his agreement with Citizens, and Citizens obtained a judgment against the debtor for approximately $80,000.
Citizens later filed a complaint for replevin of the subject vehicle, requesting a court order awarding possession of the vehicle to Citizens based upon its security interest perfected in 2011. Ott’s filed an appearance and a competing motion for possession of the subject vehicle.
The trial court held that Citizens’ recorded security interest on the certificate of title was superior to Ott’s common law artisan lien, and Ott’s appealed. Ott’s argued its non-filed common-law artisan lien should be found superior to Citizens’ filed security interest because the final work performed on the vehicle by Ott’s was completed several months prior to the July 27, 2011, filing and perfection of the opposing creditor security interest.
Authentication. According to the Ohio appellate court, Ohio law expressly provides that artisan liens connected to motor vehicles are specifically excluded from application of the Uniform Commercial Code. As such, Ott’s common-law artisan lien did not constitute a recognized competing UCC lien that would entitle the lien to UCC order of priority consideration, said the court. Thus, the timing of the lien’s perfection had no impact on the priority of the liens.
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